Archive for Friday, November 13, 2009
Connell Resources suing county for breaches of contract
More than $100,000 being sought in YVRA contract dispute
November 13, 2009
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Steamboat Springs Connell Resources has filed a lawsuit against Routt County seeking more than $100,000 in damages for allegations related to work at Yampa Valley Regional Airport in 2005 and 2006.
The lawsuit, filed Oct. 23 in Routt County District Court, claims numerous breaches of contract by Routt County through its engineering firm. At the time, that firm was Carter & Burgess, which Jacobs acquired in November 2007. YVRA Manager Dave Ruppel said Connell’s contract work involved construction of three large-aircraft parking spots designed for Boeing 757s and of additional parking areas for vehicles. The work was part of the $16 million second phase of the airport’s multiyear improvements.
The phase also included a 23,500-square-foot terminal expansion unrelated to the lawsuit.
Connell’s contract was for $9.4 million, according to the lawsuit, which contains a 68-point list of allegations including “defective specifications” from Carter & Burgess that “caused delays, lost productivity, and additional costs for labor and equipment and independent materials testing.”
Routt County attorney John Merrill said Thursday that the lawsuit is “probably the largest case in exposure to the county” that he’s seen. He has been the county’s attorney since 1991. He described “exposure” as “not what is probable, but what is possible,” should the lawsuit go to the jury trial it requests.
The lawsuit does not cite a specific amount of damages sought beyond the “more than $100,000” specification for legal purposes. Merrill said the lawsuit could seek a wide range of damages — as much as $1.4 million.
Merrill said the county has requested an extension for submitting its response to the lawsuit to Nov. 30. He added that attempts are under way to settle the case out of court.
“We have been working with Connell to resolve this without litigation, and we still hope to do that,” Merrill said.
But Merrill said there is a difference of opinion.
“There is a gap between what we think is appropriate and what they think is appropriate,” Merrill said about settlement discussions. “Both sides will spend a lot of money on lawyers, which doesn’t help close the gap.”
Merrill also said the county has “concern that we didn’t get what we were supposed to get as far as quality,” in the construction at YVRA.
Connell Resources’ attorney, Janet McDaniel, of Faegre & Benson in Denver, declined to comment about the lawsuit when reached by phone Thursday. Richard Connell, president of Connell Resources in Fort Collins, could not be reached Thursday.
Ruppel said the lawsuit does not indicate incomplete or unsafe construction at the airport, which is preparing for the winter season.
“There’s nothing that’s related to that contract that will delay or negatively impact our ability to use the airport this season — the airport is functional at this point. It’s more of a contractual dispute,” Ruppel said. “None of these things are areas where there’s any kind of a safety concern or things like that — it has to do with other contractual things.”
Ruppel said constructing large-aircraft parking is a complex operation.
“Anytime you’re parking an airplane there, it’s significant concrete,” he said. “It’s about four feet of different kinds of material that have to be layered up to create a surface that’s capable of holding that aircraft.”
It took three attempts in summer 2006 to lay a 20-by-350-foot strip that met stringent Federal Aviation Administration requirements.
Merrill said that should damages be awarded, the financial costs would “impact the airport, primarily.” The FAA contributed significant funding to the YVRA improvements, but Merrill said whether the FAA would be involved in restitution would depend on the outcome of the case.
Ruppel said YVRA maintains at least $1.2 million in working capital reserves.
“We’ve been successful at keeping that, at a minimum,” he said. “We do at times have more than that.”
Merrill said construction disputes are rare for the county.
“In my recollection, this is only the second construction dispute case in the time I’ve been here,” Merrill said.
The other dispute involved YVRA and TCD regarding the terminal remodel, Merrill said.
He said that dispute, which was about three years ago, was resolved before arbitration.
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