BY COUNCILOR JOHNSON:
RESOLVED, that the proper city officials are authorized to pay to Oneida Realty Company the sum of $11,656.06 in full and final settlement of the claim which arose out of a break in a city watermain occurring near 5 North Fourth Avenue West on December 13, 2006; payment to be made from the Self Insurance Fund 610-036-1652-5841.
STATEMENT OF PURPOSE: On December 13, 2006, property located at 5 North Fourth Avenue West and owned by Oneida Realty Company was flooded by a broken water line. During street construction in 1986, the city installed a new shut-off valve to the building, but did not remove the old valve and part of the water line. The old valve and water line started to leak and eventually broke causing the damage to the building.
The city’s liability is based upon the legal principle that it is under a duty to maintain its watermains in a reasonably safe condition. The city of Duluth has investigated this claim and verified the damages and expenses. The civil division of the city attorney’s office analyzed the city’s loss exposure. Settlement negotiations were conducted and an agreement has been reached in the amount of $11,656.06. The city attorney’s office recommends this settlement.