Willmar City Council OKs action to clear land title dispute with Jennie-O
WILLMAR — Jennie-O Turkey Store is disputing whether the city of Willmar has title to a piece of property included in two parcels the city wants to sell to Jennie-O for the company’s planned office expansion project.
To help settle the dispute, the City Council passed a resolution authorizing city staff to commence — if necessary — a legal process called quiet title action. A quiet title action is described as a legal process to establish a party’s title to real property against anyone and everyone, and thus “quiet’’ any challenges or claims to the title.
City Planning and Development Director Bruce Peterson, who requested authorization to commence quiet title action, said costs for the legal process would be borne by the city.
However, council members say they want Jennie-O to pay the costs, which council member Tim Johnson, a retired attorney, estimated at $2,000 to $3,000.
The title dispute and its recommended solution were discussed at the Monday night council meeting by Peterson and City Attorney Robert Scott.
While conducting title work on the Jennie-O land transfer, Peterson said, a minor title question was uncovered that dates back to 1936. He said it involved the property owner and the granting of an easement to the state of Minnesota for Highway 40.
Scott said there is a dispute between the title company that the city used in 2009 when the city platted the land and Jennie-O’s title company about the chain of title.
Scott said the city took a deed from property owners in 1940 including lands that are the subject of the dispute. He said it appears a small section of one parcel, called Outlot B, was carved out of the deed the city took in 1940.
Previous to that, the same property owners had granted an easement to the state for the Highway 40 right-of-way. In 2008, the state granted everything it owned in this parcel and other parcels when it turned Highway 40 over to the city and it did so by quit claim deed, which means the city took everything the state had.
Scott said Jennie-O’s title company is saying the city only has the easement for the right-of-way and is not owner of that small section of Outlot B. Scott said there is other record evidence of title in the city, which he said he thought is a source of the dispute between the title companies.
He also said there is evidence of a tax sale of this land including the entire quarter section where this property is located, showing that it was granted to the state as a result of delinquent taxes that were not paid in the 1930s.
“That’s satisfactory to the city’s title company,’’ Scott said, but is apparently not satisfactory to Jennie-O’s title insurance company.
Scott said the city will exhaust other options before it undertakes quiet title action, such as continuing to investigate through the city’s contacts with Kandi Abstracts to find additional evidence of title.
He said the city does have rights under the purchase agreement to take some time to remedy any defects Jennie-O has identified. He said the city could simply purchase a title policy before closing, which Scott said he was told would enable Jennie-O’s title company to then issue a title policy to Jennie-O and would resolve the issue.
“I think that would be cheaper and much more advantageous for everyone than going through a quiet title action. The quiet title action is a last resort,’’ said Scott. “If it comes to a quiet title action, we are optimistic that the city would be able to quiet the title in its favor and ultimately in Jennie-O’s favor and let this project move forward.’’
Johnson said quiet title action is not that expensive. Citing the estimated $1.7 million value of land given to Jennie-O for its project and additional $1.7 million expense for moving Willmar Avenue, Johnson asked why Jennie-O has not offered to pay the cost.
Councilman Ron Christianson asked if the resolution could be worded to request Jennie-O pay the cost if the city commences quiet title action. City Administrator Charlene Stevens said council can make that decision and staff would take it to Jennie-O’s attorneys.
Christianson then offered an amendment, seconded by Johnson, to add the payment requirement to the resolution authorizing quiet title action. The amendment was approved 7-1 with Christianson, Johnson, Rick Fagerlie, Bruce DeBlieck, Steve Ahmann, Denis Anderson and Jim Dokken in favor and Audrey Nelsen opposed.
Then, the council voted 8-0 to approve the amended resolution that authorized quiet title action and the request for Jennie-O expense payment.