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Resolution No. 2021-103 Settlment Agr w/BKV, Wenck & McGough Resolution No. 2021-103 Approving Settlement Agreement with BKV Group, Inc., Wenck Associates, Inc. and McGough Construction Co., LLC Whereas, a settlement was worked out between BKV Group (Architect), Wenck Associates (Engineer), and McGough Construction (Construction Manager) to warranty initial failure of a six- foot band of concrete running parallel to the pond at the Fridley Civic Campus, and Whereas, the repair has been performed by McGough Construction to our expectations and satisfaction without the need for such agreement from the City, and Whereas, the agreement indicates the repair is performed without cost to the City, and Whereas, McGough Construction has requested this agreement be executed by the City in order to close out the project, Now, therefore be it resolved, that the City Council of the City of Fridley hereby approves execution of the attached settlement agreement. th Passed and adopted by the City Council of the City of Fridley this 25 day of October, 2021. _______________________________________ Scott J. Lund – Mayor Attest: Melissa Moore – City Clerk SETTLEMENT AGREEMENT AND RELEASE This Settlement Agreement and Release (Ð Agreement Ñ) is made and entered into effective as of date that this Agreement has been fully executed by all of the following parties (the Ð Effective Date Ñ) (a) City of Fridley (Ð Fridley Ñ), (b) BKV Group, Inc. (Ð BKV Ñ), (c) Wenck Associates, Inc. (ÐWenckÑ), and (d) McGough Construction Co., LLC (Ð McGough Ñ). Fridley, BKV, Wenck, and McGough are singularly referred to as a ÐPartyÑ or collectively as the Ð Parties.Ñ WHEREAS, effective on or around April 11, 2016, Fridley and BKV entered into a modified B101 AIA Agreement between Owner and Architect (the Ð Architect Agreement Ñ) for the design of the Fridley Civic Complex Project (the Ð Project Ñ). WHEREAS, effective on or around April 11, 2016, BKV and Wenck entered into a modified C401-2007 AIA Agreement between Architect and Consultant (the Ð Consultant Agreement Ñ) for the civil design of the Project. WHEREAS, effective on or around May 23, 2017, Fridley and McGough entered into a modified A133 AIA Agreement between Owner and Construction Manager (the Ð Construction Contract Ñ) for the construction of the Project. WHEREAS, a challenge arose between BKV, Wenck, McGough, and Fridley over the cracked concrete along the 6Ó wide panel running parallel to the pond (collectively, the Ð Fridley Claims Ñ) at the Project. WHEREAS, Fridley notified BKV and McGough of the Fridley Claims in accordance with the terms of the Architect Agreement and Construction Contract. WHEREAS, BKV notified Wenck of the Fridley Claims in accordance with the terms of the Consultant Agreement. WHEREAS, the Parties agreed to avoid a formal dispute resolution over the Fridley Claims and have agreed to resolve these issues on the terms and conditions set forth below and without admission of wrongdoing or liability. NOW, THEREFORE, for good and valuable consideration, the sufficiency of which is expressly acknowledged, the Parties agree as follows: 1. No admission of liability: This Agreement is binding and represents a compromise of disputed claims. This Agreement is not intended to be an admission of liability by the Parties. 2. BKV and Wenck Payment: Between them, BKV and Wenck, the ÐDesign TeamÑ agree to pay McGough 2/3 the costs of the overall work, at McGoughÓs standard rates in effect when the Repair Plan is performed, with Wenck paying 31/60 of the cost of completion of the Repair Plan, and BKV paying 3/20 of the cost of the completion of the Repair Plan, and McGough absorbing 1/3 of the cost of completion of the Repair Plan (defined in Paragraph 3 below) in settlement of the Fridley Claims (ÐSettlement Amount Ñ). McGough shall receive payment of the Settlement Amount from the Design Team within fifteen (15) calendar days of the date of McGoughÓs invoice, which will be issued upon FridleyÓs acceptance of the Repair Plan work. 3. McGough Performance: McGough agrees to perform the concrete repair at retaining wall pursuant to the Concrete Repair Plan, (ÐRepair PlanÑ) Figure 1, dated November 19, 2020 prepared by BKV Group, Inc. and Wenck and agreed upon by the Parties (attached as Exhibit A). McGoughÓs performance of the Repair Plan is its financial contribution to the Settlement Amount. 4. FridleyÓs Release of BKV, Wenck, and McGough: Subject to the survival obligations set forth in Paragraph 6 of this Agreement and upon completion of the Repair Plan, Fridley, on behalf of itself and all of its past and present officers, directors, shareholders, employees, agents, representatives, predecessors, successors, subsidiaries, affiliated companies, 2 insurers, and assigns, hereby releases and forever discharges McGough, BKV, and Wenck, any and all of their respective past and present officers, directors, shareholders, trustees, principals, members, insurers, employees, agents, representatives, predecessors, successors, and assigns from any and all claims, losses, debts, liability, demands, obligations, costs (including costs of suit), expenses, damages, attorneysÓ fees, actions and causes of action, of any nature, arising out of the Fridley Claims. 5. Mutual Release of BKV, Wenck and McGough: Upon execution of this Agreement, McGough, BKV, and Wenck, on behalf of themselves and each of their past and present officers, directors, shareholders, employees, agents, representatives, predecessors, successors, subsidiaries, affiliated companies, insurers, and assigns, hereby release and forever discharge the other from and against any and all claims, losses, debts, liability, demands, obligations, costs (including costs of suit), expenses, damages, attorneysÓ fees, actions and causes of action, of any nature arising out of or related to the Settlement Amount, or the Fridley Claims. 6. Survival of Obligations: Except for the release of the Fridley Claims in Paragraph 4 of this Agreement, the Parties acknowledge and agree that financial contributions toward the Settlement Amount and performance of the Repair Plan does not alter, waive, release or otherwise impair any rights or remedies Fridley may have under the terms and conditions of the Construction Contract, the Architect Agreement, at law, or in equity, including all warranties, guarantees, and indemnities that have been provided by BKV and McGough under their respective agreements with Fridley. The release of the Fridley Claims in Paragraph 4 of this Agreement does not extend to future claims arising out of or related to unknown, latent defects in the work or design services provided by BKV, Wenck, and McGough in connection with the Project. 7. Confidentiality: The Parties agree to maintain this Agreement as confidential, subject to the following: (A) without disclosing the specific terms of this Agreement, including 3 the amounts paid, the Parties may state or indicate in general terms the fact that their respective claims have been settled or resolved; (B) the Parties may disclose the specific terms of this Agreement to legal counsel and tax advisors, as well as the PartiesÓ officers, directors, insurers, and employees; (C) the Parties may disclose the specific terms of this Agreement as necessary (i) in any action to enforce this Agreement, (ii) as required by law, including discovery pursuant to the Rules of Civil Procedure, and (iii) to satisfy obligations imposed by law, court order, reporting and any regulatory requirements. 8. Non-Disparagement: The Parties agree that they will not criticize, defame, or disparage: (i) the reputation, character, image, products or services of any other Party; and (ii) the reputation, character or image or any present director, officer, employee or sales representative of the other Parties. 9. Counterparts/Electronic Execution: This Agreement may be executed in counterparts, each of which shall be treated as an original. This Agreement may also be executed and delivered electronically and the same shall be fully enforceable against the Parties. Any Party may request an originally signed execution version of this Agreement if such request is made within thirty (30) days of the Effective Date. 10. Representations: The Parties acknowledge that they have been represented by counsel in connection with the execution of this Agreement. The Parties have relied solely on their own judgment, belief and knowledge and the advice and the recommendation of their own independently-selected counsel. Each side shall bear its own costs, disbursements, and attorneysÓ fees, as incurred. 11. Entire Agreement: This Agreement contains the entire agreement among the Parties. The Parties have no other written or oral agreements relating to this settlement, and any amendment or modification to this Agreement must be in writing signed by the Parties. 4 12. Governing Law: This Agreement is governed by the laws of the State of Minnesota, both as to interpretation and performance. If any provision of this Agreement is declared invalid by the final decision of a court, the remaining provisions shall not be affected thereby. 13. Agreement Binding Upon Successors: The Parties agree that the terms, conditions and provisions of this Agreement are binding upon, and shall inure to the benefit of all assigns, successors-in-interest, personal representatives, estates, administrators, heirs, devisees and legatees of each of the parties. 14. Authority: The signatories to this Agreement represent that they are duly authorized to execute this Agreement on behalf of their principal, that the respective party they represent possesses the right and authority to enter into this Agreement and that the making of this Agreement does not violate any separate agreement with any other person or entity. 15. Estimated Repair Plan Cost: The maximum estimated cost of the Repair Plan including compaction of subgrade and concrete testing is $130,000; however, McGough and the Design Team agree that before the Repair Plan work begins, a detailed cost breakdown shall be provided and agreed upon. In the event of changes in the Repair Plan work, McGough shall be entitled to an equitable adjustment of the Settlement Amount as a result of such changes. Such adjustment in the Settlement Amount shall be based upon mutual acceptance of a lump sum properly itemized and supported by sufficient substantiating data. 16. Execution of Work. The construction is to start immediately in spring of 2021 contingent on weather and be completed within 45 days. All work shall be coordinated with the Fridley prior to commencing. \[THREE SIGNATURE PAGES IMMEDIATELY FOLLOW\] 5 IN WITNESS WHEREOF, the undersigned has executed this Agreement, as of the date below noted. CITY OF FRIDLEY By____________________________ Name_________________________ DATED: ___________________, 2020 Its____________________________ 6 IN WITNESS WHEREOF, the undersigned has executed this Agreement, as of the date below noted. BKV GROUP, INC. By____________________________ Name__________________________ DATED: ___________________, 2020 Its____________________________ 7 IN WITNESS WHEREOF, the undersigned has executed this Agreement, as of the date below noted. WENCK ASSOCIATES, INC. By____________________________ Name__________________________ DATED: ___________________, 2020 Its____________________________ 8 IN WITNESS WHEREOF, the undersigned has executed this Agreement, as of the date below noted. MCGOUGH CONSTRUCTION CO., LLC By____________________________ Name_________________________ DATED: ___________________, 2020 Its____________________________ 9