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Kozy appeal denied; $140,000 bond requirement remains in place

The Minnesota Court of Appeals said Eric Ringsred and fellow plaintiffs failed to show why they should not be required to post the security before court-ordered repairs are undertaken.

FILE: Kozy roof
Even with a snow cover, an aerial view of the Pastoret Terrace building Nov. 16, 2020, reveals extensive damage to the roof of the former home to the Kozy Bar and Apartments.
Steve Kuchera / File / Duluth News Tribune

DULUTH — The Minnesota Court of Appeals has declined to intervene in the latest legal challenge stemming from the yearslong battle over the downtown building that long housed the Kozy Bar and Apartments.

The court last week rejected a petition filed earlier in February by Pastoret Terrace's former owner, Eric Ringsred, and a group known as Respect Starts Here. The plaintiffs essentially were asking the appeals court to reverse a security bond that had been ordered by a district court judge and force the building's current owner, the Duluth Economic Development Authority, to start shoring up the historic, but heavily damaged structure.

Preservationists hoping to save the badly damaged downtown building asked a higher court to effectively overturn a $140,000 bond that they have been unable to post. The city called it an "improper appeal."

Ringsred and fellow preservationists sued in 2018 in an effort to prevent demolition of the 1887 Oliver Traphagen-designed building, which has been ravaged by a series of fires dating back to 2010. Ringsred, lacking fire insurance, lost ownership of the building to tax forfeiture.

The Court of Appeals previously overturned a district court ruling that the building could come down, ordering in August 2020 that DEDA "perform all maintenance and repairs necessary to prevent the property's further deterioration" pending further court proceedings.

Judge Eric Hylden subsequently ordered the agency to erect an exterior-bracing system to prevent an outward collapse of the building's facade at First Street and Second Avenue East. But, after a second appeal, he made it contingent upon the plaintiffs posting $140,229 bond, allowing DEDA to receive reimbursement should it ultimately prevail in the lawsuit.

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Ringsred and company argued the bond violated the previous appellate order, saying the district court and city should be ordered to "strictly follow the remand instructions" and perform maintenance. A city attorney, in response, called the petition an "improper appeal" and said "there is no failure to perform any duty clearly imposed by law."

A deadline passed without payment from backers of the fire-damaged property, but the building won't immediately meet the wrecking ball.

In a four-page order denying the petition, Court of Appeals Chief Judge Susan Segal noted that a three-judge panel previously addressed the bond issue, determining it was a matter for the district court's discretion. She added that the preservationists "identify no legal authority supporting their position that security is prohibited."

"Petitioners have not established that the district court failed to perform a duty clearly required by law to compel maintenance and repair efforts without security," Segal wrote.

With another major fire striking the building in November 2020, Hylden recently ordered new expert reports and set a July evidentiary hearing to supplement the record of an April 2019 trial — making a fall decision likely on DEDA's latest bid to secure permission to move forward with demolition.

Tom Olsen has covered crime and courts for the Duluth News Tribune since 2013. He is a graduate of the University of Minnesota Duluth and a lifelong resident of the city. Readers can contact Olsen at 218-723-5333 or tolsen@duluthnews.com.
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