The City of Platteville may soon become the owner of 15 properties now owned by Darrel L. Kallembach.
That depends on a Common Council vote, scheduled for Tuesday, as well as the results of a court injunction by Kallembach’s father, Leonard, over three of the properties, filed Monday.
The Common Council discussed the properties in closed session at its meeting April 8. The council next meets Tuesday, and City Manager Larry Bierke said Monday that a resolution regarding transferring the deeds on the properties will be on the council’s next meeting agenda.
The city was the high bidder on 15 of Darrel Kallembach’s 19 city properties at the sheriff’s sale in January 2013.
The city bid on the properties using the $366,765.38 in fines and interest accumulated on the more than 100 citations Kallembach was issued for violations of city ordinances between 2008 and 2010.
The council resolution will be to “authorize the city to accept the sheriffs’ deeds for up to all of the properties” on which the city was the highest bidder, said City Attorney Brian McGraw.
As for what the city will do with those properties, McGraw said, “That is a decision the council is going to have to wrestle with ove the next several months. The decisions are fairly obvious — they could sell one or more of the properties, [or] retain one or more of the properties, and that conversation has yet to occur.”
The city was the high bidder on 420 and 440 Southwest Road, 222 and 230 N. Elm St., 310 W. Gridley Ave., 160 E. Mineral St., 565 Cedar St., 235 N. Third St., 185 Center St., 260 and 430 S. Chestnut St., 85 Water St., 375 Irene St., 255 and 335 Division St., and 1536 County B.
The city was outbid on four properties. The houses at 605 and 605½ Southwest Road and 465 Division St. were purchased by Laufenberg & Larson Properties, LLC. The houses at 390 W. Pine St. and 540 Mineral St. were purchased by R&M J&S Rentals, LLC. The city was outbid on the Mineral Street and Division Street properties by $1 each.
The city ended up using $288,341.96 of the $366,765.38 in interest and penalties in successfully bidding upon the 15 properties. The city’s successful bids ranged from $12,927.25 on the Center Street property to $30,000 for the County B property.
The 19 properties have combined assessed valuation of $1,412,900, ranging from $49,800 on the Center Street to $116,500 on the County B property.
The 540 Mineral St. property was sold for $14,226.17. The 465 Division St. property went for $16,001. The 605 and 605½ Southwest Road property went for $23,500. The West Pine Street property was sold for $23,750.
The most recent legal wrinkle occurred Monday, when Leonard Kallembach LLC filed what McGraw said was “a motion for relief of confirmation of execution sale” over the County B, Third Street and 430 Chestnut properties.
“Leonard Kallembach, LLC is claiming that the LLC should have received notice that the city was selling those properties so Leonard Kallembach, LLC could bid on those properties at the sheriff’s sale,” said McGraw.
Leonard Kallembach’s appearance in the legal process adds another twist to a process that started six years ago when the city started issuing citations against Darrel Kallembach.
“I’ve been practicing law since 1980, and this is the first time I’ve ever seen this in terms of what I’ve been involved in,” said McGraw.
The city originally planned to bid on seven of Kallembach’s properties when the sheriff’s sale was first scheduled in September 2012. Kallembach stopped the sale by declaring Chapter 13 bankruptcy. However, the bankruptcy proceeding was canceled when Kallembach failed to file a payment schedule or make the first payment to creditors.
Kallembach’s first citations from the City of Platteville came in January 2008, when he pleaded no contest to five citations for failing to remove furniture from the exterior of a building. From then until July 30, 2010, Kallembach was issued more than 100 citations for allowing occupancy without a valid rental license, allowing occupancy of more than four unrelated persons, and second- and third-offense citations for allowing occupancy without a valid rental license.
The city won a judgment against Kallembach for a total of $309,804.84 in March 2011. In October 2012, Dane County Circuit Judge David Flanagan issued an order prohibiting Kallembach from leasing or renting any of his 21 properties until he obtained a city rental license. Flanagan also ordered Kallembach to provide a copy of all of his existing leases to the city and to have his properties inspected. Kallembach also was ordered to provide notice of violations within 10 days of a citation’s being issued.
An arrest warrant for contempt of court was issued for violating the court order. Kallembach was taken into custody by Platteville police at his property at 440 Southwest Road, and spent more than four months in jail in 2012.
Kallembach claimed in a letter to The Platteville Journal in February 2012 that the city had no authority to cite him “unless my refusal to permit inspections and obtain rental licenses resulted in substantial interference with the comfortable enjoyment of life, health, or safety of others.” Kallembach’s claim was based on a 1981 state Supreme Court decision that defined a public nuisance as “an unreasonable activity or use of property that interferes substantially with the comfortable enjoyment of life, health, or safety of others.”
