HomeMy WebLinkAbout75-89 RESOLUTION1
RESOLUTION NO.
75-R9
A RESOLUTION AUTHORIZING THE MAYOR AND CITY
CLERK TO EXECUTE A SETTLEMENT AGREEMENT WITH
UNITED PACIFIC INSURANCE COMPANY TO RESOLVE
LITIGATION OVER CONSTRUCTION OF A SLUDGE
MANAGEMENT SYSTEM AT THE FAYETTEVILLE
WASTEWATER TREATMENT PLANT.
BE IT RESOLVED BY THE BOARD OF- DIRECTORS OF THE CITY OF
FAYETTEVILLE, ARKANSAS: s° ,
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Section 1. The Mayor and,City Clerk are hereby authorized
and directed to execute a'. settle 'agreement 'with United Pacific
Insurance Company to resolve`• •litigation over construction of a
sludge management system at the Fayetteville Wastewater Treatment
Plant. A copy of .the settlement agreement .authorized for
execution hereby is attached..hereto marked Exhibit "A" and made a
part hereof.
PASSED AND APPROVED this /.J. day of
ATTEST:
APPROVED:
By:
Mayor
5
1989.
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SETTLEMENT AGREEMENT
This Agreement entered into on the date hereinafter set
forth by and between City of Fayetteville, Arkansas ("City")
and United Pacific Insurance Company ("United Pacific"):
WITNESSETH:
WHEREAS, on .or about July 3, 1986, Olson Construction
Company ("Olson") entered into a contract ("Contract") with the
City for the construction of a Sludge Management System
("Project") to be utilized in connection with certain
wastewater treatment plant improvements for the City; and
WHEREAS, pursuant to the Contract, Olson was obligated to
furnish at performance bond and a payment bond to the City, and
suchbond'was furnished by Olson, as principal, and by United
Pacific, as surety; and
WHEREAS., Olson began performance under the Contract, but
it subsequently defaulted thereunder and its surety, United
Pacific, through its agents and employees, undertook completion
of the work remaining to be completed and correction of
deficiencies in Olson's prior work; and
WHEREAS, several disputes and disagreements have arisen
between the parties or their agents, including but not limited
.to disputes concerning defective or incomplete work, claims for
retainage and final contract balance, claims for liquidated or
other delay damages and claims for design deficiencies; and
WHEREAS, United Pacific has filed a claim against the City
and its engineers on the Project, CH2M Hill Southeast, Inc.
("CH2M Hill"), Civil Action No. 89-5019, United States District
Court, Western District of Arkansas, Fayetteville Division, and
the City has filed a counterclaim against United Pacific in
that action ("the Lawsuit"); and
WHEREAS, United Pacific and the City have reached a
compromise and settlement of their differences, disputes,
claims and counterclaims arising from or pertaining to the.
Contract or the Project and they wish to set forth -their
agreement in this writing;
NOW, THEREFORE, in consideration of the premises, the sum
of money to be paid as hereinafter recited, and the releases
and covenants contained hereinafter, it is agreed as follows:
1. The City agrees to pay to United Pacific the sum of
$360,000 as final payment under the Contract. The City agrees
to make such payment within ten days after execution of this
Agreement by all parties and delivery of an executed copy
thereof
to City.
2. The parties each agree, and hereby authorize and
direct their respective attorneys, to dismiss with prejudice
the Lawsuit, each party to bear its own costs.
3. The parties each agree that the date of substantial
completion for Phase I of the Project was July 31, 1988, and
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t, `r
that the date of substantial completion of Phase II of the
Project was July 31, 1988.
4: The City does hereby release and discharge United
Pacific, its officers, employees and agents, from any and all
claims, actions, demands, or causes of action, and all other
liability, whatsoever, arising out of or related to any delays
in the completion, of the•Project or arising out of or related
to any cost to complete any of the work required by Olson by
the Contract or any other liability except for liability under
the payment bond or for liability for defective work under the
performance bond. It is understood that whatever payment bond
obligations United Pacific may have, and whatever performance
bond obligations it may have for defective work, under
applicable law or the Contract are not released hereby.
5. Except only for the obligation of the City to make
the payment provided for in paragraph 1, above, United Pacific.
does hereby fully release and discharge the City, its officers,
employees and agents, including CH2M Hill, from any and all
claims, actions, demands and causes of action, and all other
liability, whatsoever, arising out of or related in any manner
to the Contract or arising out of or related in any manner to
the Project, whether known or unknown, asserted or unasserted.
United Pacific agrees to defend and hold harmless the City, its
officers, employees and agents, from any claim, action, demand
or cause of action of Olson or of any third party claiming
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under or through Olson, arising out of or related to the
Contract or the Project. Notwithstanding the foregoing
provisions in this paragraph, nothing herein shall be construed
to release or discharge the City or CH2M Hill from claims or
causes of action for contribution or indemnity arising from or
related to tort claims of third parties asserted against United
Pacific; provided, however, that "tort claims of third parties"
shall not include any claims for the payment of money for
supplying or furnishing material, labor or services to or for
the Project and provided further that nothing herein shall be
construed as a waiver by the City or by its officers,
employees, or agents, including CH2M Hill, of any statutory
immunity against tort actions that may be available to them
under law.
6. The City and United Pacific each warrant to the other
that neither it nor its officers, employees or agents,
including CH2M Hill, is cognizant of any presently existing
payment bond obligation, or of any presently existing defects
in the work covered by the performance bond (other than the
incomplete work releasedherein), or of any tort claims of
third parties.
7. It is understood and agreed that this Settlement
Agreement
represents the compromise of disputed claims and that
the agreement for final payment to be made hereunder and the
agreements of the parties for releases and other agreements
stated herein
are,not.to be construed as any admission of
liability on the part of any party to, or released by, this
Agreement.
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8. This Agreement shall be binding upon and shall inure
to the benefit of the parties and their respective successors
and assigns, and to the benefit of CH2M Hill, its successors
and assigns.
9. This Settlement Agreement contains the entire
agreement of the parties hereto with respect to the subject
matter hereof and the terms of this Agreement are contractual
and not a mere recital. This Agreement may be executed in
counterparts, but each shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the City of Fayetteville, Arkansas,
and United Pacific Insurance Company have caused this
instrument to be executed by their duly autho_ized
representatives, effective this
Attest:
46b
day of
1989.
THE CITY OF FAYETTEVILLE,
ARKANSAS
By:oifr/!�'�
Its /7,c. -
UNITED PACIFIC INSURANCE
COMPA
/dra—
It
Its ASSISTANT VICE PRESIDENT
AGREEMENT
MlCtOF14MED
THIS AGREEMENT made and entered into this 5th day of August 1987,
by and between United Pacific Insurance Company (hereinafter referred to as
"Surety'), and the City of Fayetteville, Arkansas (hereinafter referred to as
"City"),
WHEREAS the City entered into a Construction Contract on July 3, 1986,
with Olson Construction Company (hereinafter referred to as "Olson") for the
construction of Wastewater Facilities Improvements, Sludge Management System,
Phase 1 and Phase 2 Construction - Contract B; and
WHEREAS Surety and Olson executed an undertaking of Suretyship naming
the City as Obligee; and
WHEREAS Olson has voluntarily defaulted in the prosecution of said
Contract, and the City and the Surety wish to arrange for the completion of said
Contract in full accord with its original terms and conditions as modified.
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties agree as follows:
1. Surety will take over and complete the work required by said
Contract in accordance with the terms and conditions of said Contract together
with any applicable modifications or change orders. "Applicable modifications
or change orders" includes any changes or modifications agreed upon in writing
by Olson as of the 5th day of August 1987.
2. The City agrees to pay Surety all remaining Contract B funds in
accordance with the terms and conditions of Contract B.
3. It is agreed that the Contractor performing this work will be
Garney Companies, Incorporated which has been designated by Surety as its Agent
for completion of this Contract.
4. The parties do not intend to create any third -party beneficiary
rights through this Agreement.
5. The parties agree that the costs to complete the work, as paid by
the Surety pursuant to the Performance Bond, which exceed the Contract balances
shall act to reduce the obligation of the Performance Bond in like amount
6. Should the Bermuda Grass stand established not meet Contract
specifications and be accepted by the City before the Contract deadline, the
Surety shall develop and implement an aggressive and timely approach to meet
Contract specifications, and shall submit this plan for review by the City.
The City agrees to cooperate with the Surety and its agents to mitigate damages
resulting from the failure of the initial grass stand to meet Contract specifi-
cations by the Contract deadline.
Page 1 of 2
4
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Should the Bermuda Grass stand established not meet Contract specifi-
cations and be accepted by the City before the Contract deadline, the City
agrees to place the statutory retainage in escrow, with the interest earned
thereon accruing to the Surety, and the retainage itself to be used by the City
in accordance with the Contract terms.
or
be placed in escrow, but shall be used by the City
Grass stand meets Contract specifications.
All amounts withheld because the Bermuda Grass stand is not sprigged
is not maintained in conformance with the Contract specifications need not
to insure that the Bermuda
The Surety's Warranty obligation shall commence on the date, as
determined by the City, when an adequate amount of Bermuda Grass stand is
established to allow use of the sludge management system for its intended
purpose.
7. The Surety shall submit to the City satisfactory evidence of all
insurance required by the Contract before the Surety's agent commences
completion of the Contract.
8. The parties agree that there is no waiver of any claim by the City
for any defective or imperfect work, or for latent defects for past work
performed, or for work yet to be performed.
IN WITNESS WHEREOF, the parties have executed this Agreement on
behalf of themselves, their heirs, successors, and assigns, the day and year
first above written.
CITY OF FAYETTEVILLE, ARKANSAS UNITED PACIFIC INSURANCE
By
Marilyn J nson
Mayor
ATTEST
Bv:
e Kenne
y Clerk
APPROVED AS TO FORM
By:
J es N. McCord
ty Attorney
By:
Way pk B. Anderson
Assistant Vice President
Page 2 of 2
CONTRACT MODIFICATION (Change Order)
Contract Modification No.: B-5
Owner:
Project Name:
Contractor:
Fayetteville, Arkansas
Sludge Management System
Olson Construction Company
DATE: 8/21/87
Project No.: MG18766.B6
The following modifications to the contract are hereby ordered:
Substitute Varco-Pruden Egyptian White roof color for Patrician Bronze for the Operations
Building and Chemical Storage Building at the Sludge Transfer Facility per CMIR # B-33.
This contract modification constitutes full and mutual accord and satisfaction for all
time and all costs related to this change. By acceptance of this contract modification,
the contractor hereby agrees,that the modification represents an equitable adjustment to
the contract, and further, agrees to waive all right to file any further claims or changes
arising out of or as a result of this change, or the accumulation of executed Contract
Modifications on this Contract.
Contract Amount:
Original Previous This
Contract Changes Change
53,680,775 0110,421) (54,341)
Contract Duration/Completion Date:
Sod and Grass Stand
Remainder of Work
APPROVED:
FAYETTEVILLE
113 W. Mountain St.
Fayetteville, Arkansas 72701
Date: /0/gfr
jd/MGDS/008
10/29/87
8/11/1987 (393 days)
UNITED PACIFIC INSURANCE
COMPANY
33405 8th Avenue South,
C-3000
Federal Way, WA 9800
By: 4�J
he
Date: Se ,/x/987
CH2M HILL
Revised
Contract
$3,566,013
2567 Fairl a Drive
Montgome , Alabama 3 116
By: 4( AkAr.-d
Date: 9/i//C 2
($4,341)