03-523Council FIle # � � �.3
RESOLUTION
CITY OF SAINT PAUL, MINNESOTA
r ,� , /�, ,
Presented By i , � �g�y���
(3
Referred To
Committee: Date
1 BE IT RESOLVED, that the proper City officers are hereby authorized and directed to pay Arkay
2 Construction Company the sum of $37,500.00 (to be allocated as follows: $11,744.00 out of
3 project funding activity code C99-3H025-0898-33193 and $ 25,756.00 out of the Tort Liability
4 Fund 09070-0511) in full and final settlement of its claims for damages arising out of the
5 Addition and Remodeling of the Martin Luther King Center, City Project No. 9921.00, and to
6 execute a Settlement Agreement and Release in substanrially the form attached hereto as E�ibit
7 A.
APPROVED:
����,�, ��--
NDGE OF DISTRICT COURT
Requested by Depa of:
G i'�'Y ��7TJ!'r1E.v
B � �^'t ',.,J1
By:
[
Form Approved by City Attorney
BY: ( ii� ' 1.�
Approved t� Mayor for� Submission to Council
H�':
Green Sheet# 104077
By:
Adopted by Council: Date ��03
Adoption C,�rtified by Council cretaxy ,
03 - Sa3
SETTLEMENT AGREEMENT AND RELEASE
THIS SET"TLEMENT AGREEMENT AND RELEASE is entered into by and between Arkay
Construction Company ("Arkay"), the C ity of Saint Paul, Minnesota ("City"), and the Adkins
Association, Inc. ("Adkins") and Mohagen Engineering, Inc., Ltd. ("Mohagen"), hereinafter
collectively refened to as the "Parties."
This settlement agreement and release sets forth the terms which conciude and dispose of
Arkay's claims arising out ofthe constnxction proj ect known as the Addition and Remodeling of the
Martin Luther King Center, City Project No. 9921.00 ("the ProjecY'), and to close out Arkay's
general construction contract for the Project.
PRENIISES:
A. Arkay entered into a general constructiott contract with the City in connection with the Project.
Adkins contracted with the City to provide design and proj ect administration services in connecfion
with the Project. Mohagen contracted with Adkins to provide structural engineering services in
connection with the Project. Over the course of the Project, Arkay made claims for additional
compensation for, among other things, changes and delays in the work alIegedly caused by the City
and/ar the design team. The City alleges that all of its actions were in accordance with its rights and
obligations under the terms ofthe contract documents and applicable law, and denies all allegations
to the contrary. Additionally, the City asserted a claim for liquidated damages against Arkay for the
untimely completion of the project. Adkins and Mohagen allege that they performed all of their
contractual obligations in accordance with the contract documents and applicable professional and
industry standards, and deny all allegations to the contrary.
B. The Parties desire to now settle and release all claims which Arkay has or could have arising
from the Project.
NOW THEREFORE, in consideration of the mutual promises set forth herein, it is agreed by and
between the Parties as follows:
In exchange for and in consideration of the releases described below, the City, Adkins and
Mohagen shall pay Arkay the sum of ONE HLJNDRED THIRTY THOUSAND AND
NO/1005 DOLLARS ($130,000.00), the sufficiency of which is hereby aclrnowledged by
Arkay, as follows:
(a) The City shall pay Arkay the sum of $37,500.00 upon execution of this agreement;
(b) Adkins and Mohagen, collectively, shall pay Arkay the sum of $92,500.00 upon
execution of this agreement.
2. In consideration ofthe payment described in Paragraph 1, above, Arkayreleases and forever
Page 1 of 3
EXHIBIT A
4�3 -5�3
discharges the City, Adkins, and Mohagen, and their representatives, successors, assigns,
employees, employers, directors, officers, agents, attorneys, sureties, and insurers, of and
from all liability, actions, causes of acrion, clauns, and demands for any damages or losses
arising out of or in any manner connected with the Project.
3. In c onsideration o f t he r elease d escribed i n P aragraph 2, above, t he C ity, A dkins, a nd
Mohagen release and forever dischazge Arkay, and its representarives, successors, assigns,
employees, empioyers, directors, officers, agents, attomeys, sureties, and insurers, of and
from any ciaims which were laiown or should reasonably have been discovered prior to May
14, 2003, including claims for liquidated damages arising from the untimely completion of
the Project and for damage to the pneumatic control, provided, however, that,
notwithstanding any Ianguage to the contrary, this release shalI not include any warranty
claims regardless ofwhen they are or were discovered. It is expressly understood and agreed
that the release set forth in this paragraph is limited by its terms and shall not extend to
include warranty claims or to include claims of any kind or nature which were uulniown or
could not reasonably be discovered prior to May 14, 2003. It is fiirther expressly understood
and agreed that Arkay does not waive, and is not estopped from raising, any defenses it may
have in law or fact to ciaims not released herein.
4. In further consideration of the payment described in Paragraph 1, above, the City, Adkins,
and Mohagen mutually release and forever discharge each other, and their representatives,
successors, assigns, employees, employers, directors, oFficers, agents, attorneys, sureties, and
insurers, of and from any claims for contribution ar indemnity arising from the claims Arkay
made in connection with the Project. It is expressly understood and agreed, however, that
the release set forth in this paragraph is limited by its terms and shall not extend to include
any other claims which the City, Adkins, and Mohagen have or might have against each
other.
5. The Parties understand and agree that this Settlement Agreement and Release is a
compromise of disputed claims and that any promises or payments made pursuant to this
Settlement Agreement and Release are not to be construed as an admission of liability on the
part of any of the Parties.
6. Should any dispute arise over the interpretarion of this Settlement Agreement and Release,
this Settlement Agreement and Release shall be interpreted neutrally and any rule requiring
interpretation against anyparty drafting various provisions ofthis Settlement Agreement and
Release shall not apply.
The parties represent that they have not transferred or assigned any rights which they are
releasing or compromising under this Settlement Agreement and Release.
8. The undersigned state and represent that they have fully read this three (3) page Settlement
Agreement and Release, and that they each lrnow and understand the consequences and legal
Page 2 of 3
o� -s ��
effect thereof. This Settlement Agreement and Release contains the entire agreement of the
Parties with regard to the matters set forth herein. This Settlement Agreement and Release
shall be binding upon and inure to the benefit of the Parties, jointly and severally, and their
respecrive representatives, empioyers, employees, directors, officers, agents, assigns and
successors in interest.
9. The terms of this Settlement Agreement and Release aze contractual in nature and not a mere
recital.
Arkay Construction Company
�
The Adkins Associates, Inc.
�
Mohagen Engineering, Inc., Ltd.
�
Its:
City of Saint Paul
By:
Dennis Flaherry
Deputy Mayor
Peter G. Mikhail
Assistant City Attorney
Date
Date
Date
Date
Date
Page 3 of 3
City Attorney's Office� 5/28/03
GREEN SHEET
o3-Sa3
wo 10 �; tl 7 7
Peter G. Mikhail
FOR
TOTAL # OF SI�NATURE PA�ES one
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❑ OIYAitOtlEY � OIYCFRII
❑ Ii11111L111LfEAYCEfOR ❑ NIUICYL�FRYI�Cf.TC
� MYOI[(ORI1196fAXf1� ❑
(CLIP ALL LOCATIONS FOR SIGNATURE)
Approval of settlement of claims o£ Arkay Construction Company, aqainst
the City of St. Paul, arising out of City Project No. 9921.00, for the
sum of $37,500.00.
PLANNING COMMISSION
CIB COMMITTEE
CIVIL SERVICE CAMMISSION
Has Nis P���m ever Worketl under a WnUact forthis depaM�ent?
VES NO
Has this peiaoNfirm e�er been e dly empbyee7
YES NO
Dces Mis D��� W�ss a sldll rot namalryG� bY any arteM-citY emDbYce7
YES tJ0
Is Nis pM6m�Frm a taryetetl veiMo(!
YES NO
Resolution of claims on terms acceptable to City of St. Pau1.
IF APPROVE�
None.
Claims will proceed to litigation and trial_where the City faces the
ris o£ a worse result.
AMOUNT OF TRANSACTION S 7� n n n n COST/Rfl/ENUE BUDGETED (CIRCIE ONE) V�a no
icsourtce Tort Liabilitv -* ecrnirrNw�e�c 09070-051]
INFORMqTON (EJ�WM
* and Project Funding Activity Code C99-3H025-0898-33193