Legal costs may double in pool case
October 15, 2004
Legal wrangling with a construction company may end up costing the city more than $710,000.
Construction company American General Development won a $313,360 lawsuit against the city in July, but now the company wants another $397,600 to pay its attorneys’ fees.
By state law, the city is liable to pay the attorneys’ fees because it rejected a lower, pre-trial offer. American General offered to settle for $228,500 in October 1993 after an attempted court mediation.
The Carson City Board of Supervisors will decide Thursday whether it will accept AGD’s request to take $397,600 for its legal fees.
“The board knew there were attorneys’ fees coming,” said Carson City Manager Linda Ritter. “They can either approve it or reject it.”
She said the city may present a counter offer.
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The city hired American General in 1998 to build its $3.74 million aquatic center. The job was fraught with design delays, project changes and difficulties. The city terminated its contract in July 2000, and withheld $328,000 in payments.
The therapy pool was too shallow and leaked, the pool slide was improperly constructed, and floor vents posed a hazard to barefoot swimmers, claimed city officials.
American General’s president and owner John Sieben said in July his company was hindered several times from doing its job.
He said designs were not finished when the contract was signed, and the contractor was unnecessarily forced to negotiate design problems.
American General sued the city for payment plus $7,500 in extra work, and the city counter-sued for $95,000 after hiring Metcalf Builders to make repairs. In all, the city paid Metcalf Builders $400,000 and several other expenses related to the project.
After a three-week trial in July, Carson City was ordered by a jury to pay AGD $335,000, plus $32,005 in interest.
American General, in turn, committed to refunding the city $53,000 for construction deficits mostly related to the therapy pool.
The city board begrudgingly approved that payment last month.
“We’re not doing this willingly or with any enthusiasm,” Supervisor Shelly Aldean said after the board announced it will not appeal the jury’s decision. “We have no choice.”
Contact reporter Robyn Moormeister at firstname.lastname@example.org or 881-1217.