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HomeMy WebLinkAbout1998-10-20; City Council; 14893; Settlement Sundt v. State et al (A-0009-96)1 . n & dTY OF CARLSBAD - AGENLm BILL 4-1 w AB# + fl93 MTG. 1 O/20/98 DEPT. CA TITLE- REPORTING OUT THE TERMS AND CONDITIONS OF DEPT. HD. THESETTLEMENT As REQUIRED BY THE BROWN ACT IN SUNDT CORP. V. STATE OF CALIFORNIA. DEPT. OF CITY ATTY. TRANSPORTATION. ET AL. CITY MGR. - RECOMMENDED ACTION: There is no action the Council needs to take. ITEM EXPLANATION: At the closed session hearing of July 28, 1998 the City Council discussed and approved a proposed settlement of the above referenced case. This item satisfies the Brown Act requirement to report the fact of a settlement of litigation approved in a prior closed session, and make the terms and conditions of the settlement available to the public. A copy of the Settlement Agreement and Mutual Release is on file in the Office of the City Clerk. FISCAL IMPACT: The cost of the settlement is approximately $50,000. EXHIBITS: None OCTOBER 28, 1998 NOTE TO FILE: Per Lee's request, the Attorney's office is to have the Mayor sign the original settlement agreement when they get it. They are then to send us a copy of the document. Any other processing of the settlement agreement will also be done by the Attorney's Office. (So far, all our Attorney's Office can provide is a copy of the settlement agreement. Lee does not want the Mayor to sign a copy of a signed signature page - Randee said they are going to have to get the original from the attorney at Daley & Heft, but had no idea when they would provide it.) ‘. DENNIS W. DALEY t ROBERT R. HEFT NEAL S. MEYERS RICHARD I. SCrlNElDER ROBERT W. BROCKMAN, JR. MITCHELL D. DEAN DAVID P. BERMAN SCOTT NOVA * MARQARET H. BUCKLEY JAMES D. MATHISON tt ROBERT H. QUAYLE IV SYLVIE P. SNYDER MICHAEL A. CHURCHILL SIOBHAN A. FRANKLIN SCOTT E. PATTERSON GOLNAR J. Fozr JOHN M. HANSEN LEE H. ROISTACHER RUDY R. PERRINO DALEY & HEFT ATTORNEYS AT LAW 462 STEVENS AVE. SUITE 201 SOLANA BEACH, CALIFORNIA 92075-2065 TELEPHONE (619) 755-5666 FAX (619) 755-7870 'October 1, 1998 RON J. BEVERIDGE WILLIAM D. BROWN Ub C‘UUNSEL CAROLE M. LEFFLER ADMINISTRATOR WRITER’S E-MAIL: NMEYERSQDALEY-HEFT.COM f slso odmirrrd In Warhin@on * also admltred in Hawiail tt also sdmlrrrd in Texas VIA PERSONAL DELIVERY Ronald R. Ball, City Attorney CITY OF CARLSBAD 1200 Carlsbad Village Drive Carlsbad, CA 92008 Re: Sundt Corporation v. State of California, Department of Transportation Arbitration File No. A-0008-96 Dear Ron: Enclosed please find the Settlement Agreement and Release in the above-referenced matter. It has now been signed by all parties except the City and we are forwarding it to you for signature. Please return the settlement agreement after it is signed. Once the document is signed, we will be able to close this file. Please call if you have any questions regarding this matter. Very truly yours, NSM/mek Enclosure (Settlement Agreement and Release) DENNIS W. DALEY t ROBERT R. HEFT NEAL S. MEYERS RICHARD J. SCHNEIDER ROBERT W. BROCKMAN, JR. MITCHELL D. DEAN DAVID P. BERMAN SCOTT NOYA + MARGARET H. BUCKLEY JAMES D. MATHISON tt ROBERT H. QUAYLE IV SYLVIE P. SNYDER MICHAEL A. CHURCHILL SIOBHAN A. FRANKLIN SCOTT E. PATTERSON GOLNAR J. Fozr JOHN M. HANSEN LEE H. ROISTACHER RUDY R. PERRINO CYNTHIA L. D’AMBROSIO KRISTIN C. PARAJECKAS t also admitted in Washington * also admirrcd in Hawaii tf also admitted in Texas DALEY & HEFT ATTORNEYS AT LAW 462 STEVENS AVE. SUITE 201 SOLANA BEACH, CALIFORNIA 920752065 TELEPHONE (619) 755-5666 FAX (619) 755-7870 November 6, 1998 RON J. BEVERIDGE WILLIAM D. BROWN OF COUNSEL CAROLE M. LEFFLER ADMINISTRATOR WRITER’S E-MAIL: NMEYERS~DALEY-HEFT.COM Ronald R. Ball, Esq. City Attorney CITY OF CARLSBAD 1200 Carlsbad Village Drive Carlsbad, CA 92008 RE: Sundt Corporation v. State of California, Deoartment of Transportation Arbitration File No. A-0008-96 Dear Ron: In follow up to your request, enclosed is an original copy of the Settlement Agreement and Mutual Release. The activity in this case is now complete. If not transmitted already, you will receive our final bill in the very near future. Very truly yours, Neal S. Meyers NSM/jgw Enclosure cc: Lloyd Hubbs - - . . SETTLEMENT AGREEMENT AND MUTUAL RELEASE Sundt Corp. v. State of California, Department of Transportation This SETTLEMENT AGREEMENT AND MUTUAL RELEASE ("AGREEMENT") is made, given, and entered into between The State of California, Department of Transportation (llCaltranslt), the City of Carlsbad ("City"), Boyle Engineering Corporation (l'Boylelfi) and Sundt Corp. (@'SundtlW) . These entities are hereinafter collectively referred to as "the parties". RECITALS A. On or about January 28, 1992, Caltrans entered into a Cooperative Agreement, Agreement No. 11-0457 with the City for the widening of the Palomar Airport Road/Interstate 5 overcrossing within the City of Carlsbad (WProject'@). Pursuant to the Cooperative Agreement, the City was responsible for project design. B. On or about April 2, 1990, the City entered into a contract with Boyle Engineering for design services relating to the Palomar Airport Road/Interstate 5 overcrossing project. C. On or about September 4, 1992, Caltrans awarded the Palomar Airport Road/Interstate 5 contract, Contract No. ll- 153914 to Sundt. Sundt began work on September 29, 1992. The project was complete by April 1994. D. Following project completion, Sundt disputed a number of items within the State's proposed final estimate. A number of these issues were ultimately resolved. However, eight claims which remained were submitted to the State Board of Review on April 20, 1995. The Board issued its determination of claims on 1 SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt CorD. v. State of California, Department of TransDortation September 15, 1995. Sundt accepted the Board's determination on two of the eight claim items. E. On or about March 25, 1996, Sundt filed its complaint with the Office of Administrative Hearings. The complaint included the remaining six claim items: Claim No. 2 Claim No. 3 Claim No. 4 Claim No. 5 Claim No. 7 Claim No. 8 F. Sundt's G. Some of Couplings for 3" and 8" reclaimed water lines. Approval process for post tension working drawings. Rebar conflict with trapezoidal girders Overhead costs associated with Contract Change Order 15. Adjustment of Item 30, roadway excavation. Interest. Complaint was assigned Case No. A-0008-96. Sundt's claims included allegations pertaining to design. Although not a party to arbitration, to facilitate a resolution among all parties, Boyle agreed to participate in mediation with Caltrans, the City and Sundt. The case was mediated before Kenneth Gibbs, Esq. on July 21, 1998. H. At the time of the mediation, in addition to Sundt's claims, Boyle and the City each had certain issues that remained in dispute. Boyle claimed entitlement to reimbursement from the City for design services in the amount of $60,465.71. The City claimed reimbursement from Boyle for costs associated with Change Order No. 15 in the amount of $95,800.04. In addition, issues 2 - . SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt Corp. v. State of California, Department of Transportation pertaining to indemnity as between Boyle and the City/Caltrans were in existence. These issues were not before the mediator. I. At the July 21, 1998 mediation session, the parties herein agreed to a settlement of all claims against each other, including settlement of Sundt's claims against Caltrans/City, Caltrans/City's potential indemnity claims against Boyle, Boyle's expenses claimed from the City and City/Caltrans claim for expenses pertaining to Change Order 15 against Boyle. J. Caltrans, the City, Sundt and Boyle agree to a complete dismissal and release of their respective claims as follows: AGREEMENT 1. In consideration of the promises, undertakings and understandings hereinafter set forth: a) Sundt will dismiss with prejudice its action against Caltrans, Case No. A-0008-96 before the Office of Administrations Public Works Contract Arbitration Committee pertaining to Contract No. 11-153914 in exchange for its receipt of settlement payment(s) totaling $100,000. b) As between the City and Boyle, each will pay one-half of the $100,000 settlement amount, or $50,000 each. cl Boyle will waive and release its claim for any reimbursement for design services as to the City. d) Caltrans/City will waive and release its claim for reimbursement for any costs associated with Contract Change Order No. 15 as to Boyle. 3 SETTLEMENT AGREEMEN!F AND MUTUAL RELEASE (con't.) Sundt CorD. v. State of California, Department of Transportation f=) Caltrans/City and Boyle will waive and release any potential claims for indemnity relating to claims raised in Case No. A-0008-96. 2. In consideration of the mutual dismissals described in paragraph A above, the parties and each of them for themselves and on behalf of their respective past, present and future agents, partners, associates, joint ventures, owners, stock holders, subsidiaries, directors, officers, employees, predecessors, heirs, assigns, insurance companies, sureties, bondholders, representatives and attorneys, and all persons acting by, through, under or in concert with them, or any of them (hereinafter collectively referred to as the "settling parties"), except for retention of the right to enforce the terms and conditions of this Agreement, the settling parties hereby forever release and discharge any and all alleged claims, liabilities, demands, obligations, causes of action, damages, losses, costs or expenses of any nature whatsoever, known or unknown, anticipated or unanticipated, fixed or contingent, which settling parties, and each of them, and/or any of the settling parties' related persons, now have, may claim to have, or may hereinafter claim to have, against any of the other settling parties and/or any of the other settling parties' related persons, which are based upon or arise or may arise out of any liability and damage issues alleged or could be alleged in Case No. A-0008-96, or otherwise relating to the subject project. Obligations for latent construction defects as that term is defined in Code of Civil Procedure 4 SETTLEMENT AGREEMENT AND MUTUAL RELEASE (conlt.) Sundt Corp. v. State of California, Department of Transportation Section 339.15 and for unexpired express warranties of work on the Project shall not be subject to any of the releases set forth in this agreement. 3. The settling parties to this Agreement hereby understand that this release is given on behalf of, extends to and is binding upon their respective insurance carriers, sureties, bondholders, heirs, successor and interest, agents, employees, joint venture partners, servants, principles, assigns, assignors, executors, guarantors, attorneys, associates, affiliates and/or any other person or entity otherwise related or connected to the parties to this Agreement. 4. This Agreement is intended as a general, full and complete release of any and all claims raised in Case No. A-0008- 96 that the settling parties and any of them and/or any of the settling parties' related persons may now have, may have had in the past, or will have in the future against any other settling party and/or any other settling parties' related persons relating to claims made in Case No. A-0008-96. This release includes any and all damages or injuries to persons, properties and/or financial interests, whether the same are known or unknown to the settling parties, expected or unexpected by the settling parties. The settling parties to this Agreement further understand and agree that all rights under section 1542 of the California Civil Code and any similar law of any state or territory of the United States are hereby expressly waived, past, present and 5 SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt Corp. v. State of California, Department of Transportation future, related to Case No. A-0008-96. Said section reads as follows: Certain claims not affected by General Release. A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. 5. The Settling Parties to this Agreement represent that their respective counsel of record have explained the effect of California Civil Code Section 1542 and, based upon that explanation, the Settling Parties to this Agreement understand and acknowledge the legal significance and the consequences of the application of said section of the Civil Code to the claims being released by this Agreement. The Settling Parties to this Agreement further represent that they understand and acknowledge the legal significance and consequences of a specific waiver of California Civil Code Section 1542 related to claims made in Case No. A-0008-96 and hereby assume full responsibility for any injuries, damages, losses or liabilities that hereafter may occur with respect to the matters released by the Agreement. 6. The Settling Parties to this Agreement hereby represent and warrant to each other that they have not heretofore assigned or transferred, or purported to assign or transfer, to any person not a party hereto, claims or rights as to any of the matters referenced herein, or any part or portion thereof. The Settling Parties to this Agreement further agree to indemnify and hold 6 - SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt Corn.. v. State of California, Department of Transportation each other harmless from and against any claim, demand, damage, liability, accounting, reckoning, obligations, cost, expense, lien, action or cause of action (including the payment of attorney's fees and costs actually incurred, whether or not litigation has commenced), based upon, or in connection with or arising out of any such assignment or transfer in violation of this representation and warranty. 7. It is further understood that this Agreement is a compromise of a disputed claim and execution of this Agreement is not to be construed as an admission of liability on the part of any party hereby released and that said parties each deny liability therefore and intend to merely avoid further litigation and buy their peace. 8. All signatories to this Agreement understand, acknowledge, and agree that: a. The consideration described heretofore in this Agreement was and is given as a result of the desire on the part of all signatories hereto to avoid any and all claims and obligations which they come or any of them come and may have asserted against them, or against any of them, arising out of Case No. A-0008-96. b. The consideration referred to previously herein is not to be construed by any of the signatories of this Agreement as an admission of any liability on the part of any other signatory hereto, all such liability being expressly denied. 7 . SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt Corp. v. State of California, Department of Transportation MISCELLANEOUS REPRESENTATIONS AND WARRANTIES 1. Each Settling Party or responsible officer or partner thereof has read this Agreement and understands the contents thereof. Each of the officers, trustees or partners executing this Agreement on behalf of their respective sole proprietorships, corporations, banking associations, trusts or partnerships or joint venture partnerships is empowered to do so and thereby bind such respective sole proprietorships, corporation, partnership, joint venture partnership or trust. 2. In entering into this Agreement and the settlement provided for herein, each Settling Party assumes the risk of any misrepresentation or mistake. The Agreement is intended to be -- and is -- final and binding between the parties hereto, regardless of any claims or misrepresentation, promise made without intent to perform, concealment of fact, mistake of fact or law, or of any other circumstance whatsoever. 3. Each Settling Party warrants and represents that (i) this Agreement in its reduction to final written form is a result of extensive good faith negotiations between the parties through their respective counsel; (ii) said counsel have carefully reviewed and examined this Agreement for execution by said parties, or any of them; and (iii) any statute or rule of construction that ambiguities are to be resolved against the drafting party shall not be employed in interpretation of this Agreement. 8 SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt Corp. v. State of California, Department of Transportation 4. This Agreement shall be deemed to have been executed and delivered within the State of California, and the rights and obligations of the Settling Parties hereto shall be construed and enforced in accordance with and governed by the law of the State of California. 5. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable for whatever reason, the remaining provisions not so declared shall continue in full force and effect, without being impaired in any manner whatsoever. 6. This Agreement may be executed in several counterparts, in one or more separate documents, all of which together shall constitute one and the same instrument, with the same force and effect as though all the Settling Parties had executed the same document at the same time. DATED: %/s- y$? DATED: rq ;y>;,- 9:; DATED: ,' DATED: /o- /- 7 @- SUND%/CORP. John Cluff, Sr. Construction on Manager, Heavy BOYLE ENGINEERING CITY OF CARLSBAD 9 - SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt Corp. v. State of California, Department of Transportation 4. This Agreement shall be deemed to have been executed and delivered within the State of California, and the rights and obligations of the Settling Parties hereto shall be construed and enforced in accordance with and governed by the law of the State of California. 5. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable for whatever reason, the remaining provisions not so declared shall continue in full force and effect, without being impaired in any manner whatsoever. 6. This Agreement may be executed in several counterparts, in one or more separate documents, all of which together shall constitute one and the same instrument, with the same force and effect as though all the Settling Parties had executed the same document at the same time. DATED: SUNDT CORP. DATED: +J T-3& DATED: I/ p lC c L/c/, p-f BO$LE ENGINEERING ' STATE OF CALIFORNIA, DEPARTMENT OF TRANSPORTATION DATED: CITY OF CARLSBAD 9 . l SETTLEMENT AGREEMENT AND MUTUAL RELEASE (con't.) Sundt Corp. v. State of California, Department of Transportation Approved as to form and content: l * (iiii&ieJ DATED. Attorney for Petitioner SUNDT CORP. PILLSBURY, MADISON & SUTRO, LLP DATED: RICHARD S. RUBEN Attorney for BOYLE ENGINEERING DALEY & HEFT DATED: ?/I/ /%3 NEAL S. ME!&& SIOBHAN A. FRANKLIN Attorneys for Respondent STATE OF CALIFORNIA, DEPARTMENT OF TRANSPORTATION, and CITY OF CARLSBAD 10 SETTLEMENT AGREEMEW AND MUTUAL RELEASE (con't.) Sun& Corp. v. State of California, Del?artment of Transportation Approved as to form and content: DATED: PETER JOHNSON Attorney for Petitioner SUNDT CORP. DATED: “i--s q DATED: PILLSBURY, MAD1 ON t SUTRO, LLP la4 RICHARD S. RUBEN Attorney for BOYLE ENGINEERING DALEY & HEFT NEAL S. MEYERS SIOBHAN A. FRANKLIN Attorneys for Respondent STATE OF CALIFORNIA, DEPARTMENT OF TRANSPORTATION, and CITY OF CARLSBAD 10