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HomeMy WebLinkAboutCanyon Springs Enterprises dba RSH Construction Services; 2022-10-04;SETTLEMENT AGREEMENT AND MUTUAL RELEASE This settlement and mutual release agreement (the "Agreement") is entered into on October 4, 2022 (the "Effective Date"), by and between the City of Carlsbad (the "City"), on the one hand, and Canyon Springs Enterprises, dba RSH Construction Services ("RSI-I"), on the other hand. The City and RSH are sometimes referred to individually as a "Party" and collectively as the "Parties." RECITALS A. This matter arises from the public works construction project commonly referred to as The Crossings at Carlsbad Municipal Golf Course Lake Refurbishment Project (the "Project"). The City, including the Carlsbad Municipal Water District and the Carlsbad Public Financing Authority, as the owner of the Project, entered into a competitively bid prime contract with RSH for construction of the Project (the "Contract"). B. Disputes arose regarding RSH's entitlement to additional compensation under the Contract as the result of alleged changed conditions at the Project. C. On about July 31, 2020, RSH filed a complaint against the City entitled Canyon Springs Enterprises, dba RSH Construction Services v. The City of Carlsbad (San Diego Superior Court Action Case No. 37-2020-00026820-CU-BC-NC) (the "Complaint"). On or about November 1, 2021, the City filed a cross-complaint against RSI-I alleging violation of Business and Professions Code section 7031 (the "Cross-Complaint"). The Complaint and Cross- Complaint are collectively referred to in this Agreement as the "Action." D. The Parties each deny liability for the respective claims asserted against each other related to the Action and have agreed to settle their respective claims. The Parties have Page 1 of 6 negotiated their disputes, which has now resulted in this Agreement and release of all claims between them as refl ected below. In consideration of the mutual covenants set forth below, the Pa1ties agree and stipulate as follows: 1. Recitals. The Recitals set forth above are incorporated into this Agreement by reference. 2. Mutual Walk-Away. In full and complete settlement of the claims asserted in the Complaint and Cross-Complaint, the Parties agree that neither Party shall recover any sum of money in connection with the Complaint and Cross-Complaint. 3. Dismissals. RSH shall dismiss its Complaint with prejudice and the City shall dismiss its Cross-Complaint with prejudice within three (3) business days of the execution of this Agreement by both Parties. Each Party shall bear its own attorneys' fees and costs incurred in the Action. 4. Releases. RSH, on the one hand, and the City, on the other hand, on behalf of themselves, and their respective heirs, executors, administrators, members, owners, partners, affiliates, related companies and assigns, hereby release and forever discharge the other Party, and their respective administrators, governing boards, districts and authorities, successors and assigns, and each of their respective past, present and future employees, attorneys, sureties, agents, representatives, partners, members, affiliates, related companies, officers and directors, from any and all claims, demands, arbitrations, actions, or causes of action, known or unknown, asserted or unasserted, suspected or unsuspected, arising out of or in any way connected with or resulting from the Project, the Contract, the Complaint, the Cross-Complaint, and/or the Action, subject only to the Exclusions set forth in paragraph 6, below. Page 2 of 6 5. 1542 of the California Civil Code. The release described above is a full and final release applying to all losses, including but not limited to damages, costs, expenses, and attorneys' fees, incurred by the Parties arising out of or in any way connected with the above- described matters. It is the intention of the Parties, in executing this Agreement, that the same shall be effective as a bar to each and every claim, demand, and cause of action, based upon the above-described matters, and the Pa1iies, subject to the Exclusions set forth in paragraph 6, below, knowingly, voluntarily, and expressly waive any and all rights and benefits otherwise conferred by the provisions Civil Code section 1542, which states at follows: A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party. The Parties expressly consent that, notwithstanding Civil Code section 1542, this Agreement shall be given full and final effect according to each and all of its express terms and conditions, including those related to unknown and unsuspected claims, demands, and causes of action. The Parties acknowledge and agree that this waiver is an essential and material term of this Agreement and, without said waiver, this Agreement would not have been entered into by RSH, on the one hand, and the City, on the other hand. 6. Exclusions. Notwithstanding the above or anything to the contrary, the Parties do not release and specifically reserve any and all rights, whether express or implied, under this Agreement and the Contract, arising out of or relating to claims for ( or under): (i) latent deficiencies as defined in Code of Civil Procedure section 337.15, subdivision (b), relating to the Project; (ii) defense, contribution and/or indemnification for third party claims relating to the Page 3 of 6 Contract and the Project; and (iii) any remaining warranty obligations of RSH and/or its suppliers relating to the Project. As of the date of the execution of this Agreement, the City represents and warrants that it is not aware of any latent defects or other claims that would be subject to the above exclusions to the mutual full and final releases. 7. Covenant Not to Contract and Submit Bids. The Parties agree not to enter into any public works construction contracts with each other, and RSH agrees not to submit bids on public works construction contracts advertised by the City or a City entity, including the Carlsbad Municipal Water District or the Carlsbad Public Financing Authority, for a period of five ( 5) years from the Effective Date of this Agreement. 8. Successors Bound. This Agreement is binding upon all of the Parties, as well as their successors and assigns. 9. Full Agreement. This Agreement contains the entire agreement between the Parties and signatories hereto as to the matters addressed herein. The terms of this Agreement are contractual in nature and not a mere recital. Each of the signers below represents and warrants they have authority to sign on behalf of the stated Party. 10. Severability. The Parties agree that if any term, provision, covenant or condition of this Agreement or the application thereof to any person, entity or circumstance, shall to any extent be or be declared to be invalid or unenforceable, the remainder of this Agreement or the application of such provision, term, covenant or condition to any other person, entity or circumstance shall not be affected thereby, and each other provision, tenn, covenant or condition of this Agreement shall be valid and enforceable to the full extent permitted by law. Page 4 of 6 11. Governing Law. Should any dispute arise hereunder, this Agreement shall be governed by and interpreted pursuant to California law. 12. Voluntary Settlement. The Parties understand that they do not have to settle. The Parties represent that they are entering into this Agreement freely and voluntarily, having had the advice of counsel, with whom they are satisfied. The Parties represent that prior to the execution of this Agreement they apprised themselves with sufficient relevant infonnation, through sources of their own selection, in order to exercise their own judgment in deciding whether to execute this Agreement. The Parties further represent that they have had the opportunity to have the consequences of this Agreement fully explained to them by counsel of their own selection and that this Agreement is executed voluntarily and with foll knowledge of its consequences. The Parties represent that the decision to enter into this Agreement was neither predicated upon, nor influenced by, any declaration or representation of the persons or entities released, other than may be contained in this Agreement. The rule of construction that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement. 13. Execution in Counterparts and Facsimile/PDF Signatures. This Agreement may be executed in counterpa1i originals, and a facsimile and/or PDF signature shall be acceptable and treated as an original for all purposes. [Signatures on next page] Page 5 of 6 IN WITNESS WHEREOF, the Patties, by signing below, agree to the foregoing terms Dated: October 4 , 2022 ---- Dated: October y-oL , 2022 F CARLSBAD APPROVED AS TO FORM ~l~-HcJ./~ By: Cindie K. McMahon, City Attorney CANYON SPRINGS ENTERPRISES, dba RSH CONSTRUCTION SERVICES CONSTRUCTION Page 6 of 6