Loading...
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° , • 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. 3 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 2 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 • • 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. 4 • 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 '.- 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)