HomeMy WebLinkAbout20242239.tiffRESOLUTION
RE: APPROVE SETTLEMENT AND RELEASE AGREEMENT FOR COUNTY ROADS 74
AND 33 ROUNDABOUT PROJECT, AND AUTHORIZE CHAIR TO SIGN -
MERCHANTS NATIONAL BONDING, INC., LAWSON CONSTRUCTION COMPANY,
AND RLI INSURANCE COMPANY
WHEREAS, the Board of County Commissioners of Weld County, Colorado, pursuant to
Colorado statute and the Weld County Home Rule Charter, is vested with the authority of
administering the affairs of Weld County, Colorado, and
WHEREAS, the Board has been presented with a Settlement and Release Agreement for
the County Roads 74 and 33 Roundabout Project among the County of Weld, State of Colorado,
by and through the Board of County Commissioners of Weld County, on behalf of the Department
of Public Works, and Merchants National Bonding, Inc., Lawson Construction Company, and
RLI Insurance Company, commencing upon full execution of signatures, with further terms and
conditions being as stated in said agreement, and
WHEREAS, after review, the Board deems it advisable to approve said agreement, a copy
of which is attached hereto and incorporated herein by reference.
NOW, THEREFORE, BE IT RESOLVED by the Board of County Commissioners of
Weld County, Colorado, that the Settlement and Release Agreement for the County Roads 74
and 33 Roundabout Project among the County of Weld, State of Colorado, by and through the
Board of County Commissioners of Weld County, on behalf of the Department of Public Works,
and Merchants National Bonding, Inc., Lawson Construction Company, and RLI Insurance
Company, be, and hereby is, approved.
BE IT FURTHER RESOLVED by the Board that the Chair be, and hereby is, authorized
to sign said agreement.
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2024-2239
EG0082
SETTLEMENT AND RELEASE AGREEMENT FOR COUNTY ROADS 74 AND 33
ROUNDABOUT PROJECT - MERCHANTS NATIONAL BONDING, INC, LAWSON
CONSTRUCTION COMPANY, AND RLI INSURANCE COMPANY
PAGE 2
The above and foregoing Resolution was, on motion duly made and seconded, adopted
by the following vote on the 21st day of August, A.D., 2024.
BOARD OF COUNTY COMMISSIONERS
ATTEST: c(&acr
Weld County Clerk to the Board
BY'
Deputy Clerk to the Board
APP VET.': O FORM:
County Attorney
1z'4
Date of signature:
WELD COU
Kevi
Perry L.
Saine
2024-2239
EG0082
SETTLEMENT AND RELEASE AGREEMENT
This Settlement and Release Agreement ("Agreement") is entered into by and between the
Board of County Commissioners of Weld County, Colorado ("Owner"), Merchants National
Bonding, Inc. ("Merchants"), Lawson Construction Company ("Lawson"), and RLI Insurance
Company ("RLI"). Owner, Merchants, Lawson, and RLI are together the "Parties" and
individually each a "Party."
RECITALS
WHEREAS, on or about January 11, 2023, Owner and Lawson entered into an Agreement
for Construction Services ("Contract") for the construction of the WCR 74/33 Roundabout
("Project");
WHEREAS, as required by the Contract and at Lawson's request, Merchants, as surety,
issued a performance bond ("Performance Bond") and a payment bond ("Payment Bond"), each
numbered NCO 4157 and each in the penal amount of $9,210,800.80, on behalf of Lawson, as
principal, for the Project (collectively, the "Bonds");
WHEREAS, on or about September 19, 2023, the Owner terminated Lawson's
performance under the Contract for default and engaged a third party contractor to complete the
Contract work ("Termination");
WHEREAS, on or about October 18, 2023, the Owner made demand on Merchants under
the Performance Bond ("Performance Bond Claim");
WHEREAS, AB Underground, LLC ("AB Underground"), a subcontractor of Lawson,
asserted a claim for nonpayment to the Owner and against Merchants' Payment Bond in the
principal amount of $1,421,054.20 ("AB Underground Claim"). AB Underground subsequently
filed suit on its claim for nonpayment in the proceeding styled AB Underground, LLC v. Lawson
Construction Company, Merchants National Bonding, Inc., Kenneth T. Lawson, and Lloyd
Lawson, Case No. 2024CV30388, in the District Court of Weld County, Colorado ("AB
Underground Lawsuit").
WHEREAS, on or about January 26, 2024, Lawson asserted a performance bond claim
against RLI, as AB Underground's surety, in connection with the Project (the "RLI Performance
Bond Claim");
WHEREAS, on or about February 26, 2024, Lawson formally disputed the Termination
and asserted affirmative claims against the Owner under the Contract ("Lawson Claims");
WHEREAS, the Parties are aware of the expense, inconvenience, and uncertainty of
contested litigation; and
Settlement and Release Agreement
ZoZ“-2239
WHEREAS, the Parties intend to settle and compromise their disputes and controversies
by entering into this Agreement.
NOW THEREFORE, in consideration of the mutual promises, representation, warranties,
and covenants herein contained, and for other valuable consideration received, the sufficiency of
which is hereby acknowledged, the Parties agree as follows:
AGREEMENT
1. Contract Balance. Merchants and Lawson agree that Owner shall maintain
possession of the $1,290,128.85 of Contract balance and that such funds may be used by Owner
to offset Owner's cost of completing the Project.
2. Settlement Payment. Merchants shall make payment to Owner in the amount of
Three Hundred Thousand and No/100 Dollars ($300,000.00) (the "Settlement Payment"). The
Settlement Payment shall be made by check payable to the order of "Weld County, Colorado"
within seven (7) business days of the Effective Date and delivered to Owner's counsel, Matthew
Hegarty.
3. Resolution of the AB Underground Claim. Merchants represents that it has
reached a settlement with AB Underground of the AB Underground Claim and the AB
Underground Lawsuit. As a term of the settlement with AB Underground, Merchants shall obtain
a release of the Owner, Merchants, Lawson and other related Lawson parties.
4. Release by Lawson and Merchants. Lawson and Merchants, on behalf of
themselves and any affiliates, subsidiaries, related entities, employees, officers, agents, owners,
representatives, attorneys, successors, assigns, hereby releases and forever discharges Owner, RLI,
and their respective affiliates, subsidiaries, related entities, employees, officers, agents, owners,
representatives, attorneys, successors, and assigns of and from any and all demands, claims, causes
of action, damages, attorneys' fees, expenses, costs, and all other claims whatsoever, in law or in
equity, which they have or may have arising from or related to the Contract, the Project, the
Termination, the Lawson Claims, and the RLI Performance Bond Claim.
5. Release by Owner. Upon receipt of the Settlement Payment, Owner, on behalf of
itself and any affiliates, subsidiaries, related entities, employees, officers, agents, owners,
representatives, attorneys, successors, assigns, hereby releases and forever discharges Merchants,
Lawson, and their respective affiliates, subsidiaries, related entities, employees, officers, agents,
owners, owners' family members, representatives, attorneys, successors, assigns, and heirs of and
from any and all demands, claims, causes of action, damages, attorneys' fees, expenses, costs, and
all other claims whatsoever, in law or in equity, which Owner has or may have arising from or
related to the Contract, the Project, the Termination, and the Lawson Claims.
6. Cancellation of Performance Bond. Within 15 business days following receipt of
the Settlement Payment, Owner shall return the original Performance Bond to Merchants marked
"Cancelled."
7. Payment Bond to Remain in Effect. The Payment Bond shall remain in force and
effect with respect for claims for nonpayment arising from labor, materials, or equipment provided
Settlement and Release Agreement 2
to Lawson in connection with the Project prior to the Termination. Merchants shall resolve all
valid claims for payment received under the Payment Bond.
8. Agreement Does Not Affect Merchant's Indemnity Rights; Separate
Settlement between Merchants and Lawson Acknowledged. Nothing in this Agreement
waives, releases, amends, limits, or affects in any way rights, defenses and claims related to any
surety bonds, other than the above -defined Bonds, Merchants may have against Lawson and/or
all persons and entities that signed any and/or all applicable agreements of indemnity, including
the General Application and Agreement of Indemnity Contractors Form dated May 23, 2022 or
any other agreement that may exist between Merchants, Lawson, and any indemnitor. However,
Merchants and Lawson represent that they have reached a settlement related to Merchants'
indemnity rights arising out of the Project and Bonds against Lawson that is memorialized in a
Settlement and Release Agreement, signed by Lawson on June 10, 2024, and by Merchants on
June 12, 2024 ("Merchants -Lawson indemnity settlement"). Nothing in this Agreement waives,
releases, amends, limits, or affects in any way the Merchants -Lawson indemnity settlement. If
there is any conflict between this Agreement and the Merchants -Lawson indemnity settlement,
the indemnity settlement shall govern and control.
9. Voluntary Agreement. Except as otherwise stated in this Agreement, the Parties,
and each of them, understand, acknowledge, and agree that they have been fully advised and
represented by legal counsel of their selection in the negotiation and execution of this Agreement;
that they are fully familiar with all of the facts and circumstances surrounding the matters, disputes,
and differences released herein; that in executing this Agreement, they are relying solely on their
own independent judgment and advice of their own legal counsel; and each Party enters into this
Agreement voluntarily and has not been influenced in any way by any representation, statement,
action, or inaction by any other Party, or by any officer, director, manager, member, employee,
agent, representative, or attorney of any of the other Parties, in the execution and delivery of this
Agreement.
10. Further Actions. The Parties agree to take such further action and execute such
additional documents as necessary to implement the terms and conditions of this Agreement.
11. No Admissions. Except as set forth herein, this Agreement constitutes the
compromise of disputed claims, and shall not be interpreted as a reflection of the merit or lack of
merit of such claims. The Parties understand, acknowledge, and agree that they have entered into
this Agreement voluntarily for the sole purpose of avoiding the risk and expense of litigation.
Nothing in this Agreement shall constitute an admission of any wrongdoing or liability by any of
the Parties.
12. No Oral Modifications. No supplement, modification, waiver, or termination of
this Agreement shall be binding or effective unless executed in writing by the Party to be bound
thereby.
13. Governing Law, Venue and Jurisdiction. The validity, construction and
interpretation of this Agreement shall be governed by the laws of the State of Colorado (exclusive
of any principles of conflicts of laws from any jurisdiction, including Colorado, which would direct
or authorize application of the substantive laws of another jurisdiction). Any dispute arising from
Settlement and Release Agreement 3
or related to this Agreement shall be litigated in the District Court in and for the City and County
of Denver, State of Colorado. Each party shall bear its own costs and attorney fees incurred in
connection with any action brought to enforce the terms and conditions of this Agreement or to
remedy or seek redress for any breach hereof or default hereunder.
14. Recitals. The Parties, and each of them, understand, acknowledge, and agree that
the Recitals set forth above are true and correct and expressly incorporated into this Agreement as
terms and conditions hereof.
15. Invalidity. The Parties jointly prepared this Agreement and no section shall be
construed against any Party as drafter. If any provision of this Agreement shall be adjudged by a
court of competent jurisdiction to be invalid, void, or unenforceable, the Court shall amend the
provision consistent with the intent of the Parties to render that provision enforceable, and the
same shall in no way affect validity or enforceability of the remainder of this Agreement.
16. Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of the Parties, their respective representatives, heirs, estates, parent and subsidiary entities,
members, managers, shareholders, principals, affiliates, successors, officers, directors, partners,
administrators, trustees, receivers, agents, employees, executors, assigns, and all other persons and
entities that could in any way have legal responsibility for, or claim any rights through, any of
them.
17. Entire Agreement. This Agreement represents the entire agreement between and
among the Parties relating to the subject matter hereof. All previous agreements, whether written
or oral, previously entered into by the Parties, have been merged into this Agreement. There are
no other courses of dealing, understandings, agreements, representations, or warranties, written or
oral, except as set forth herein.
18. Authority. Each of the Parties represents and warrants to all other Parties that the
person signing this document on its behalf is duly authorized to execute this Agreement on its
behalf.
19. Signatures. This Agreement maybe executed in any number of counterparts, each
of which when duly executed and delivered shall be an original, but all such counterparts shall
constitute one and the same agreement. Any signature page of this Agreement may be detached
from any counterpart without impairing the legal effect of any signatures, and may be attached to
another counterpart, identical in form, but having attached to it one or more additional signature
pages. Digital signatures and signatures exchanged by facsimile or by .pdf format shall be deemed
legally binding and the equivalent of original signatures.
20. Effective Date. This Agreement shall become effective upon execution by all the
Parties and delivery to counsel for all the Parties (the "Effective Date").
21. No Third Party Beneficiary. There is no third -party beneficiary contemplated or
intended by the Parties under this Agreement.
22. Parties to Bear Their Own Costs. Each Party shall bear its own costs (including
attorneys' fees) through the execution of this Agreement.
Settlement and Release Agreement 4
23. Headings. The headings of each Section of this Agreement are inserted for
purposes of convenience only and shall not define, limit, or describe the scope or intent of any
Section of this Agreement, nor in any way affect this Agreement.
[signature page follows]
Settlement and Release Agreement 5
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the
Effective Date.
ATTE
Bv:
Clerk to the : oard
ame: Kevin D. Ross
s: Chair
fwip
MERCHANTS NATIONAL B 44AUj
Deputy
BOARD OF COUNTY COMMISSIONERS
OF WLH-eE AIZY, COLORADO
By:
Name:
Its:
LAWSON CONSTRUCTION. COMPANY
By:
Name:
Its: jirep,,,,4,4,
RLI INSURANCE COMPANY
By:
Name:
Its:
AUG 2 1 2024
Settlement and Release Agreement 6
Z�Z�-ZZ39
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the
Effective Date.
BOARD OF COUNTY COMMISSIONERS
OF WELD COUNTY, COLORADO
By:
Name:
Its:
MERCHANTS NATIONAL BONDING, INC.
BY:
Name: Gina Lockwood
Its: Assistant Vice President - Claims
LAWSON CONSTRUCTION COMPANY
By:
Name:
Its:
RLI INSURANCE COMPANY
By:
Name:
Its:
Settlement and Release Agreement 6
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the
Effective Date.
BOARD OF COUNTY COMMISSIONERS
OF WELD COUNTY, COLORADO
By:
Name:
Its:
MERCHANTS NATIONAL BONDING, INC.
By:
Name:
Its:
LAWSON CONSTRUCTION COMPANY
By:
Name:
Its:
RLI INSURANCE COMPANY
By:
Name: Siam'-
Its: C6. -.—s rcckrr
Settlement and Release Agreement 6
Claim #
NCO 4157
Principal
Lawson Construction Company
Comments Invoice # Amount
Lawson performance bond settlement $300,000 00
CHECK # 14271
PAYEE WELD COUNTY, COLORADO
Check Date 09/11/2024 TOT $300000.00
T
TO VERIFY AUTHENNTICITY, SCE REVERSE SIDE FOR DESCRIPTION OF THE 11 SECURITY FEATURES
M ERC HANTIN\
BONDING COMPANYM
MERCHANTS NATIONAL BONDING, INC.
6700 Westown Parkway • West Des Moines, IA 50266 • 515-243-8171
Wells Fargo Bank N. A
Des Moines, IA
•
***Three Hundred Thousand Dollars And 00/100 Cents***
PAY TO THE ORDER OF
WELD COUNTY, COLORADO
P.O. Box 758
GREELEY, CO 80632
1122 CHECK NO.
730
14271
pc HALL& EVANS
S`1ATTORNEYS AT LAW
Matthew J. Hegarty
hegartym@hallevans.com
(303) 628-3418
LLC
File No. 13983-30
Via FedEx
September 12, 2024
Weld County Attorney's Office
c/o Bruce Barker, Weld County Attorney
1 150 "O" Street
Greeley, CO 80632
RE: Lawson Construction Company v. Board of County Commissioners of the County Of
Weld et al., Project: WCR 74/33 Roundabout No. 82200139
PRE -LITIGATION Settlement payment to Weld County, Colorado
Dear Bruce:
Enclosed please find Merchants Bonding check number 14271 in the amount of
$300,000.00 made payable to Weld County, Colorado, which appears to be in satisfaction of all
monetary obligations of Merchants and Lawson in the above -referenced matter pursuant to the
fully executed Settlement Agreement and Release which the parties have now executed. Please let
me know if you have any questions or concerns regarding same.
Enc.
Very truly yours,
s/ Matthew J. Hegarty
Matthew J. Hegarty, Esq.
of HALL & EVANS, L.L.C.
1001 Seventeenth Street
Suite 300
Denver, CO 80202
P 303-628-3300
F 303-628-3368
www.hallevans.com
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