HomeMy WebLinkAbout1975 Resolution No. 045•
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IU ~:>OLUT IUN NO. 45 , :i UUI :~ 01 : J~'l!> •
A IU:SO LUT I ON UAT I FY I NL; Tl II : Al;l<Et :MENT OJ: S.EPT.EMliLI< Z !> 1 J ~(J ~
BETWEEN THE CITY OF ENGLEWOOD AND AMAX; REJECTING THE OFFER
OF SETTLEMENT BY THE ORAVO CORPORATION OF FOUR HUNDRED
TllOUSAN U UOLLARS;UR GJNG THAT MERITORIOUS DEFENSES BE INTER-
PO SED TO TllE DRAVO CO RP ORATION SUIT, AND AU'J'JIOHIZING THE
PAYMENT OF PROPORTIONATE SHARE OF NECESSARY AND REASONABLE
COSTS AND EXPENSES OF SUIT.
WHEREAS, by Agreement dated September 25, 1969, the City
of Englewood (Englewood) and American Metals Climax, Inc.
(AMA X), a New York corporation, entered into an agreement
to become joint-developers of certain Englewood water rights
in the Fraser River Basin known as the Ranch Creek Collection
System; and
WllEREAS, hy th e t er ms of saiJ Agreement AMAX was to be
responsible for the construction of all physical facilities
ne cessa ry to divert, carry and store the waters derived from
the Englewood water rights located in the Ranch Creek project;
and
WllEREAS, pur s uant to this agreement AMAX requested and
received bids for the work designated as Phase II, Meadow
Creek Dam, a portion of the Ranch Creek Collection System;
and
WHEREAS, on October 11, 1973, AMAX accepted the bid of
Dravo Corporation, a Pennsylvania corporation, to perform
that work; and
WHEREAS, in December, 1974, Dravo Corporation submitted
to AMAX a claim for additional compensation under the contract;
and
WHEREAS, this claim was denied by both AMAX and the City
of Englewood as being unwanted; and
WHEREAS, on March S, 1975, the Dravo Corporation filed
a Complaint in the United States District Court for the
District of Colorado, seeking damages in the total amount
of one million seven-hundred sixty-one thousand five-hundred
ninety dollars ($1,761,590); and
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WllEIH:AS, the first claim contends that the sojls
information provided by AMAX to the contractor constituted
~ithcr an express or implied representation and warranty
as to the actual conditions of the project site, Dravo
maintains that it relied upon such representations and
warranties to its detriment. The second claim alleges
that both AMAX and Dravo believed that the soils informa-
tion was accurate, which belief formed the basis of a mu-
tual mistake by the parties in executing the contract.
The remaining four claims contend that there were condi-
tions as a result of the actions of the Phase I contractor,
the failures of the access road and unusual weather, which
c aused extensive delays with attendant costs to Dravo; and
WHEREAS, AMAX'S Answer and Counterclaim asserts that
the information provided was adequate and accurate, that no
mistake was made as to the existing conditions and that any
losses suffered by Dravo are the result of its own mismanage-
ment of the project; and
WHEREAS, Dravo has heretofore offered to settle its claim
for a total of four hundred thousand dollars ($400,000) and
AMAX has requested the City of Englewood to consider favorably
such offer to settle and pay its pro rata share of forty-five
percent of the cost of said settlement together with the cost
of defending the suit to the date of settlement; and
WHEREAS, it appears to the City Council that manner in
which AMAX and its personnel have preserved and gathered
evidence pertinent to this case neither AMAX nor its con-
sultants were at fault or in any way to blame for any losses
sustained by the Dravo Corporation on the project;
NOW, TllEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF ENGLEWOOD, COLORADO, as follows:
1. The City Council hereby reaffirms and ratifies that
certain agreement entered into by and between the
City of Englewood and AMAX under date of September
25, 1969, and the amendments thereto.
2. That the various claims presented on behalf of the
Dravo Corporation in the United States District Court,
Case No. 75-M-237, are believed to be unfounded and
do not form a basis for recovery against the City of
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Eni:h·woud, a m1111i<"ipal corporation, nor to its
co-developer AMAX.
3. That meritorious defenses do in fact exist to the
above claims and should he presented in the normal
course of events in the trial of the above-entitled
action, therefore, the offer of settlement presented
on behalf of Dravo Corporation is hereby expressly
r e j c l· tt·ll.
4. That the City of Englewood, Colorado, shall pay its
proportionate share of expenses ordinarily incident
to and reasonably necessary for the proper undertaking
of the defense of said action instituted by the Dravo
Corporation in the United States District Court,
District of Colorado.
ADOPTED AND APPROVED this 6th day of October, 1975 .
AT TES T:
I, William D. James, Ex Officio City Clerk-Treasurer
of the City of Englewood, Colorado, do hereby certify that
the above and foregoing is a true, accurate and complete
c opy of the Resolution No. -~ , Series of 1975.
Ex Offlc1.o Cffy Clerk-Treasurer
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