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! <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />i <br />I <br />I <br />I <br />I <br /> <br />EBERT CONSTRUCTION/SEH <br />Payment Issues re: <br /> Construction of Fire Station II <br /> <br />CASE <br /> <br />By: William K. Goodrich, City Attorney <br /> <br />Background: <br /> <br />As the Council is aware, Ebert Construction was the general contractor on the Fire Station <br />Project. SEH was the architect. In 2001, we held a mediation hearing and settled a claim by Ebert <br />relating to liquidated damages for its delay in completion of the project. <br /> <br />In 2002, Ebert again brought claim against the City alleging $16,000.00 of its contract fee was <br />improperly deducted by the City from its payment. This issue generally relates to the City's change <br />order directing Ebert to not construct the landscaping part of the contract. Upon examining its <br />records, Ebert claims this amount was twice credited to the City. City Staff believes Ebert to be <br />wrong. A formal arbitration of the issue is pending and will be heard in late September. <br /> <br />SEH has an unpaid bill to the City in the approximate amount of $26,000.00. The Council <br />instructed staff to attempt to negotiate a lesser payment to SEH as a result of perceived improper <br />advice relating to the Ebert liquidated damages issue, and now, possible improper record keeping <br />relating to Ebert's pending $16,000.00 claim. <br /> <br />In a settlement effort, SEH has offered to defend and indemnify the City on the pending Ebert claim <br />if the City will pay SEH its $26,000.00 bill. <br /> <br />Recommendation: <br /> <br />Staff recommends some form of settlement with SEH, based on Council direction. <br /> <br />Council Action: <br /> <br />Motion: (Based on Council direction.) <br /> <br />Review Checklist: <br />City Administrator <br /> <br />-363- <br /> <br /> <br />