KSR Investment, LLC, et al., Relators,

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A23-1618

KSR Investment, LLC, et al.,
Relators,

vs.

The City of Columbia Heights,
Respondent.

Filed August 12, 2024
Affirmed
Bjorkman, Judge

City of Columbia Heights
Resolution No. 2023-35

Miles John Ringsred, Trautmann Martin Law, Minneapolis, Minnesota (for relators)

Paul Donald Reuvers, Andrew A. Wolf, Iverson Reuvers, Bloomington, Minnesota (for
respondent)

Considered and decided by Smith, Tracy M., Presiding Judge; Bjorkman, Judge;
and Slieter, Judge.
NONPRECEDENTIAL OPINION
BJORKMAN, Judge
Relators KSR Investment LLC and Penrod Lane LLC own residential rental
property in Columbia Heights. On appeal, they challenge the decision of respondent City
of Columbia Heights (city) to revoke the occupancy license for KSR’s property, arguing
the decision reflects procedural error and is arbitrary and capricious. Relators also argue
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that the city erred in applying a two-strike ordinance provision to revoke the occupancy
licenses for both of their properties for a period of five years. We affirm.
FACTS
This appeal involves two rental properties. The first is a duplex located at 966 &
968 44 1/2 Avenue NE, Columbia Heights (the duplex) and owned by Penrod. The second,
a 17-unit apartment building, is located at 1000 Peters Place NE, Columbia Heights (Peters
Place) and owned by KSR. At all relevant times, both properties were managed by Hussain
Khan.
In October 2021, the occupancy license for the duplex was revoked by a unanimous
vote of the Columbia Heights City Council based on Penrod’s failure to submit an
occupancy-license renewal application along with the proper fees , and failure to schedule
the requisite property inspection. The city reinstated the license about two months later ,
after Penrod remedied these deficiencies.
After receiving numerous tenant complaints, the city inspected Peters Place in
August 2022. The inspection revealed ten violations of the city’s property maintenance
code including: faulty electrical outlets; malfunctioning carbon monoxide detectors;
interior and exterior doors that did not close or latch; missing light fixtures; missing and
expired smoke detectors; broken and missing baseboards; rodent infestation; mold, water
damage, and unsafe drywall in one unit’s kitchen and bathroom; an improperly installed
shower; and broken window latches and handles. During the next year, the city conducted
almost monthly follow-up inspections, finding continued violations including rodent
infestation, lack of a proper fire door, and broken and crumbling concrete blocks along the
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patio area. And tenants continued to complain about the living conditions. During a June
2023 city-wide tenant meeting, tenants approached city council members who were in
attendance to report significant ongoing issues, including rodent infestation throughout the
building, frustration with how KSR and Khan treated them, and Khan’s lack of urgency in
responding to maintenance requests.
In July 2023, the city council unanimously voted to revoke Peters Place’s occupancy
license after finding that the code violations had not been corrected. In its formal
resolution, the city council also ordered that “[a]ny person or owner who has had an interest
in two or more licenses revoked pursuant to City Code shall be ineligible to hold or have
an interest in any occupancy license for a period of five years from the date of this Order.”
Accordingly, the occupancy license for the duplex was also revoked because of Khan’s
shared managerial interests in the duplex and Peters Place.
KSR and Penrod challenged the city’s decision in an appeal to the city’s “board of
appeals,” arguing that KSR properly addressed the code violations, the tenants had a duty
to give timely written notice to Khan of any maintenance requests and had failed to do so,
and the city council’s decision to revoke both occupancy licenses was “prejudic[ed].” The
board of appeals, which was made up of the same city council members who made the
revocation decision, unanimously denied the appeal. KSR and Penrod appeal to this court
by writ of certiorari.
DECISION
As a general rule, we afford a presumption of correctness to the decisions of
administrative agencies and cities, and will reverse them “only when they reflect an error
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of law or where the findings are arbitrary, capricious, or unsupported by substantial
evidence.” CUP Foods, Inc. v. City of Minneapolis, 633 N.W.2d 557, 562 (Minn. App.
2001), rev. denied (Minn. Nov. 13, 2001) . This is so because an appellate court’s
“authority to interfere in the management of municipal affairs is, and should be, limited
and sparingly invoked.” White Bear Docking & Storage, Inc. v. City of White Bear Lake ,
324 N.W.2d 174, 175 (Minn. 1982); see Big Lake Ass’n v. St. Louis Cnty. Planning
Comm’n, 761 N.W.2d 487, 491 (Minn. 2009) (“Our limited and deferential review of a
quasi-judicial decision is rooted in separation of powers principles.”). It is not our role to
“retry facts or make credibility determinations, and we will uphold the decision if the lower
tribunal furnished any legal and substantial basis for the action taken.” Staeheli v. City of
St. Paul, 732 N.W.2d 298, 303 (Minn. App. 2007) (quotation omitted).
The city established a property maintenance code for the purpose of “correct[ing]
and prevent[ing] conditions that adversely affect or are likely to adversely affect the life,
safety, general welfare, and health” of people in the city. Columbia Heights, Minn., Code
of Ordinances (CHCO) § 5A.101(C) (2007). The code requires an occupancy license for
all premises that are “rented, leased, let, or used for any type of occupancy in the city”
except for owner-occupied single-family homes. CHCO § 5A.401 (2007). Occupancy
licenses are granted and renewed annually upon demonstration that the premises complies
with minimum standards for safe living as enforced through inspections by the “City
Manager and his designated agents.” CHCO §§ 5A.201-.212, .301-.303, .401-.407 (2007).
The city may revoke or suspend an occupancy license upon a finding of “noncompliance”
with these standards, after which a new license may be issued “in the manner provided for
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obtaining an initial license.” CHCO § 5A.408(A) (2007). The code further provides that
“[a]ny person or owner who has had an interest in two or more licenses revoked pursuant
to this code shall be ineligible to hold or have an interest in an occupancy license for a
period of five years.” CHCO § 5A.408(E) (2007).
I. The city’s decision to revoke the occupancy license for Peters Place does not
reflect an error of law and is not arbitrary and capricious.

KSR does not contend that the city council’s findings of fact lack evidentiary
support. But it argues that the city violated its right to due process and its revocation
decision is arbitrary and capricious. We address each argument in turn.
First, KSR asserts that the city violated its due-process rights by revoking its license
based on information tenants provided to council members at the June 2023 city-wide
tenant meeting of which KSR was not given notice. This argument is unavailing.
“Sufficient due process generally requires reasonable notice and a hearing.” CUP Foods,
633 N.W.2d at 563. The record persuades us that both aspects of due process were satisfied
here. The June 2023 meeting was a general tenant meeting that was open to the public.
Tenants of Peters Place and other rental premises received fliers by mail that contained
information about in-person and remote attendance. Information about the meeting was
also posted on the city’s website. Khan or another representative of KSR could have
attended this meeting and chose not to do so.
It is undisputed that KSR received notice of the city council meeting at which
revocation of Peters Place’s occupancy license would be decided. Khan attended the
meeting as KSR’s representative and responded to the reported tenant concerns and other
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evidence of ongoing code violations. Moreover, as described below, the city council’s
decision was based on an extensive record including testimony from the fire chief who
conducted almost monthly inspections; inspection reports describing the code violations;
and photographs taken during the inspections that depict the violations. This evidence
alone supports revocation of Peters Place’s occupancy license. To the extent certain city
council members may have considered concerns tenants expressed to them outside of the
city council meeting, the record as a whole convinces us that any error in such
considerations is harmless. See Schwardt v. County of Watonwan, 656 N.W.2d 383, 388
(Minn. 2003) (stating that “in quasi-judicial hearings the quality of evidence and testimony
does not have to meet full judicial standards”).
Second, KSR asserts that the city’s decision to revoke the occupancy license for
Peters Place is arbitrary and capricious because the city ignored evidence that the code
violations had been substantially corrected. The record defeats this assertion. As noted in
the findings of fact portion of the city council’s resolution, code violations that existed at
the time of the city council meeting include the lack of a fire door in the first-floor front
stairwell, crumbling concrete blocks along the front patio, and rodent-infestation and other
pest-control issues throughout the building. These and other violations are documented in
the fire chief’s inspection reports from August 2022 to June 2023 and in the numerous
photographs taken in connection with the inspections. Several city council members
acknowledged that KSR had taken steps to remedy the violations. But they concluded
those steps were not sufficient because significant code violations remained. We give great
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deference to the city council’s factual and credibility determinations so long as they
engaged in reasoned decision-making. We are persuaded that the city council did so. 1
II. The city council properly applied CHCO § 5A.408(E).

Following its revocation of the occupancy license for Peters Place, the city also
revoked the occupancy license for the duplex pursuant to CHCO § 5A.408(E). This
ordinance provides that “[a]ny person or owner who has had an interest in two or more
licenses revoked pursuant to this code shall be ineligible to hold or have an interest in an
occupancy license for a period of five years.”2 For purposes of this ordinance, “person” is
defined as “[a]n individual, heirs, executors, administrators or assigns, and also includes a
firm, partnership or corporation, its or their successors or assigns, or the agent of any of
the aforesaid.” CHCO § 5A.103 (2007).
On appeal, the city clarified that this ordinance only prohibits Khan from holding or
having an interest in an occupancy license in the city for five years. The parties agree that
an occupancy license covers physical property; person s hold or have interests in such
licenses. Here, it is undisputed that Khan, as the manager of both the duplex and Peters

1 KSR also argues that the board of appeals erred by affirming the city council’s revocation
decision, and that its determination is “marred by the same procedural errors and biases
that tainted the original [r]evoction [h]earing.” This argument is unavailing. CHCO
§ 5A.307(A) (2007) provides for an appeal “on the original violation notice.” That is not
the situation here, and the code does not otherwise provide for the appeal KSR presented
to the city. But because we discern no basis to disturb the city’s revocation decision, we
need not address KSR’s challenge to the board of appeal’s decision to affirm it.

2 Relators contend that this ordinance is unconstitutionally void for vagueness. Because
the city clarified that this ordinance does not apply to relators, we need not address the
constitutional challenge.
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Place, had interests in the properties’ respective occupancy licenses at the time each were
revoked. Accordingly, CHCO § 5A.408(E) bars him from holding or having an interest in
an occupancy license in the city for the next five years. This five-year prohibition does not
extend to Penrod and KSR so long as Khan does not work for or have any other interest in
the companies or their rental properties. In other words, if Khan no longer manages and
has no other interest in the duplex, Penrod may reapply for an occupancy license because
the interest that created the five-year license revocation would no longer be attached to the
property. And if Khan no longer manages or has an interest in Peters Place, KSR may
reapply for an occupancy license after it remedies the existing code violations. On this
record, we see no error in the city’s application of the ordinance.
Affirmed.