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HomeMy WebLinkAboutLONEROCK, INCINSURANCE NOT REQUIRED A-2022-229 WORK MAY PROCEED CLERK OF THE COUNCIL DATE: NOV 2 9 2022 Return FULLLY EXECUTED Copy to COTC, M-30 SETTLEMENT AND RELEASE AGREEMENT 9 CAo (11 This Settlement and Release Agreement ("Settlement Agreement') is made and entered (John F) (AV) into by and between the City of Santa Ana ("City") and Lonerock, Inc. ("Lonerock") (collectively referred to herein as the "Parties" and individually as a "Party"). RECITALS A. WHEREAS, on or about November 15, 2016, City, as owner, and Lonerock, as contractor, entered into an agreement ("Contract') for the construction of the Santa Ana Delhi Diversion Project (the "Project'); B. WHEREAS, a dispute arose between the Parties on the Project involving alleged differing site conditions related to higher than anticipated groundwater, construction and removal of a temporary channel diversion, and overhead and start-up costs due to alleged owner -caused delays, leading to Lonerock submitting Change Order No. 7 in the amount of $1,647,849.84 and, after the City rejected the change order request, a Government Code claim (the "Dispute"); C. WHEREAS, on or about July 23, 2021, Lonerock filed a complaint against the City in a matter styled Lonerock, Inc. v. City of Santa Ana, Orange County Superior Court Case No. 30-2021-01211998-CU-BC-CJC (the "Action"). D. WHEREAS, on or about October 31, 2022, the Parties mediated and reached a resolution of the Dispute and Action; E. WHEREAS, the Parties desire to avoid the expense, inconvenience, and uncertainties of engaging in further dispute resolution and litigation and, therefore, desire to settle and compromise their differences and all disputes existing and potentially existing between them, without the admission of liability by any of them; F. WHEREAS, the Parties hereby, with the intention of resolving and releasing all claims arising out of or related to the Project and the Dispute, enter into this Settlement Agreement to formally memorialize the terms of the settlement as set forth below; and G. WHEREAS, each Party declares that it has read this Settlement Agreement and understands and knows the contents thereof, and represents and warrants that each of the Parties executing this Settlement Agreement is empowered to do so and hereby binds the respective Party. NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein, the mutual understandings contained in this Settlement Agreement and other good, valuable and sufficient consideration, the Parties agree as follows: Page 1 of 6 55394.00060\40824418.1 TERMS. 1.1 Settlement Payment The City shall pay Lonerock in the amount of Two Hundred Ninety -Five Thousand Dollars and Zero Cents ($295,000.00) for settlement of any and all claims and amounts due on the Project, including, but not limited to, the Dispute and Action (the "Settlement Payment"). Payment of the Settlement Payment shall be made within sixty (60) calendar days of final signature of this Settlement Agreement. 1.2 Dismissal of Action with Prejudice. Lonerock will file a Request for Dismissal (with prejudice) of the Action within five (5) calendar days after the Settlement Payment has been received. Lonerock will provide the City's counsel a conformed copy of the entered dismissal within five (5) calendar days of receipt from the court. 2. FULL SETTLEMENT. 2.1 Except for the obligations set forth in the Agreement or otherwise noted herein, the Parties acknowledge that the Settlement Payment and dismissal of the Action shall constitute full and final settlement of all claims the Parties have against one another, including, but not limited to, compensation for all contract amounts and pending change orders, change order proposals and requests, contract balance, claims, backcharges, and credits related to the Dispute, Action, and Project. 3. RELEASES. 3.1 Release Of Claims by City. Except as set forth by this Settlement Agreement and as reserved in Section 3.5 below, City releases and discharges all claims of every kind whatsoever whether known or unknown, which City or any of its officials, officers, agents, representatives, employees, successors and/or assigns, asserts or could assert against Lonerock or any of its officials, officers, agents, shareholders, representatives, sureties, insurers, employees, predecessor, successors and/or assigns, relating to the Dispute, Action, and Project ("City Releases"). 3.2 Release Of Claims by Lonerock. Except as set forth by this Settlement Agreement and as reserved in Section 3.5 below, Lonerock releases and discharges all claims of every kind whatsoever whether known or unknown, which Lonerock or any of its officials, officers, agents, shareholders, representatives, employees, predecessors, successors and/or assigns, asserts or could assert against City or any of its officials, officers, consultants, agents, shareholders, representatives, sureties, insurers, employees, architects, engineers, construction managers, predecessor, successors and/or assigns, relating to the Dispute, Action, and Project ("Lonerock Releases"). 3.3 Released Matters. The City Releases and Lonerock Releases are collectively referred to as the "Released Matters." Specifically excluded from the Released Matters include any liability or obligation created by this Settlement Agreement. Page 2 of 6 55394.00060\40824418.1 3.4 Civil Code Section 1542 Waiver. (a) With respect to the releases described in Released Matters, the Parties expressly waive all rights under California Civil Code section 1542 which provides that a general release does not extend to unknown or unsuspected claims which, if known, would have materially affected the settlement. California Civil Code section 1542 provides: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY." (b) The Parties acknowledge that they may hereafter discover facts different from, or in addition to, those which they now believe to be true with respect to the release of claims. The Parties agree that the foregoing release shall be and remain effective in all respects notwithstanding such different or additional facts or any discovery thereof. (c) The Parties further acknowledge and agree that waivers of rights under Section 1542 of the California Civil Code have been separately bargained for and are essential and material terns of this Settlement Agreement, and, without such waivers, this Settlement Agreement would not have been entered into. 3.5 Third Party Actions, Warranties and Latent Constriction Defects Exclusions. The Parties agree that specifically excluded from the Released Matters and Civil Code 1542 Waiver are any demands, claims and causes of actions arising from or relating to unexpired warranties or latent construction defects in the Project or any third party action against the City arising out of Lonerock's construction of the Project or work at issue in this Dispute and that City shall not be precluded from bringing any action at law or in equity arising from or relating to such matters. This includes any latent defects or claims made pursuant to California Code of Civil Procedure section 337.15. 4. GENERAL PROVISIONS. 4.1 Representation and Warranty. The Parties and signatories hereby each represent, covenant and warrant that they are authorized (individually or by their respective principals) to enter into and execute this Settlement Agreement and that they have not previously assigned any claims released or assigned in this Settlement Agreement, in whole or in part, or taken any other steps which would adversely affect the rights which are the subject of this Settlement Agreement. In the event that any of the above representations and/or warranties are breached or any of the representations and/or warranties contained in this subparagraph prove false, the breaching/misrepresenting Party hereby agrees to defend, indemnify and hold the other Party harmless from all damages, loss, liability, costs and attorneys' fees resulting from said breach/misrepresentation. Page 3 of 6 55394, 00060\40824418. l 4.2 No Reliance. Each Party acknowledges: (i) this Settlement Agreement is the resolution of a filly matured set of facts and each Party individually declares and represents it is executing this Settlement Agreement in reliance solely on its own judgment, belief, and knowledge of the facts surrounding the transactions described in this Settlement Agreement; (ii) this Settlement Agreement is made without reliance upon any statement or representation not contained in this Settlement Agreement of any other Party, or any representative, agent or attorney of any other party; (iii) no promise, inducement or agreement not expressed in this Settlement Agreement has been made to any Party; and (iv) the recitals, terms and conditions contained in this Settlement Agreement are contractual and not mere recitals. 4.3 Discovery. Each Party acknowledges that it may subsequently discover facts different from, or in addition to, those which it now believes to be true with respect to the Released Matters, and agree this Settlement Agreement shall be and remain effective in all respects notwithstanding such different or additional facts. 4.4 Additional Documents. Each Party agrees to perform such further acts and to execute and deliver such further documents as may be reasonably necessary or appropriate to carry out the intent or provisions of this Settlement Agreement. 4.5 Entire Agreement. This Settlement Agreement embodies the entire understanding and agreement between the Parties pertaining to the matters described herein and supersedes and cancels all prior oral or written agreements between the Parties. No modification of this Settlement Agreement shall be valid unless agreed to in writing by the Parties. 4.6 Voluntary. This Settlement Agreement is executed voluntarily and without duress or undue influence on the part of or on behalf of the Parties, or of any other person, firm or other entity. 4.7 Consultation with Legal Counsel. The Parties acknowledge that they have had the right to seek counsel in the preparation of this Settlement Agreement and have had it fully explained to them by such counsel, and that they are fully aware of the contents of this Settlement Agreement and of its legal effect. Except as provided for in this Settlement Agreement, none of the Parties have been influenced to any extent whatsoever in executing this Settlement Agreement by any representations, statements, or omissions pertaining to any of the foregoing matters by any Party or said Party's counsel. 4.8 Drafting of Settlement Agreement. None of the Parties hereto, nor their respective counsel, shall be deemed the drafters of this Settlement Agreement for pruposes of construing the provisions thereof. The language in all parts of this Settlement Agreement shall in all cases be construed according to its fair meaning, not strictly for or against any of the Parties hereto. 4.9 Waiver. No provision of this Settlement Agreement may be waived unless in writing and signed by the Parties. Waiver of any one provision herein shall not be deemed to be a waiver of any other provision herein. . 4.10 Assignment. Each Party represents and warrants that it has not assigned or otherwise transferred any interest in any claims which are the subject matter hereof. Each Party agrees to indemnify and hold any other Party, and each of them, harmless from any liability, loss, Page 4 of 6 55394.00060\40824418.1 claims, demands, damages, costs, and expenses for attorneys' fees incurred by any of them as a result of any person asserting such assignment of transfer. 4.11 Governing Law. This Settlement Agreement is entered into in the County of Orange, State of California, and shall be interpreted pursuant to California law. If legal action is necessary to enforce any of the terms of this Settlement Agreement, such action shall be brought in accordance with the laws of the State of California in a court having appropriate jurisdiction. 4.12 No Promise or Warranty. No promise or warranty shall be binding on the Parties except as expressly contained in this Settlement Agreement. 4.13 Attorneys' Fees Incurred in Resolving the Dispute The Parties agree to bear their own attorneys' fees and costs. However, in the event of any suit or proceeding arising from the enforcement or breach of this Settlement Agreement, the prevailing party shall be entitled to recover reasonable attorneys' fees and costs in addition to any other permitted relief. 4.14 Settlement Agreement Binding on Assignees, Successors This Settlement Agreement shall bind and inure to the benefit of the successors and assigns of the Parties, and to all affiliates, dba's or any other associated entities. 4.15 Severability. In the event that any portion of this Settlement Agreement is deemed illegal, invalid or unenforceable in any respect, then such invalidity, illegality or unenforceability will not affect any other provision of this Settlement Agreement and this Settlement Agreement shall be construed as though such illegal, invalid or unenforceable provision had never been contained herein, unless a court determines the primary purpose of this Settlement Agreement would be frustrated. 4.16 Counterparts. This Settlement Agreement may be executed in multiple counterparts, all of which shall constitute a binding Settlement Agreement. Facsimile and/or PDF signatures, when received, shall have the same force and effect as original signatures. [SIGNATURES ON NEXT PAGE] Page 5 of 6 55394.00060\40824418.1 A-2022-229 PLEASE READ THIS DOCUMENT CAREFULLY. IT CONTAINS A GENERAL RELEASE OF CLAIMS KNOWN AND UNKNOWN. The Parties have executed and delivered this Settlement Agreement consisting of six (6) pages. WHEREFORE, the undersigned have read the foregoing Settlement and Release Agreement, and fully understanding it agree to its terms, hereby execute this Settlement Agreement and make it effective on the date of the last signature hereto. CITY OF SANTA ANA LONEROCK, INC. By: /,LL4�iL By: Its: City Manager Its: Dated: &171�� Dated: APPROVED AS 70 FORM JambL Pmk Auivaet (Sty Aumay ATTEST: Page 6 of 6 55394.00060W0824418.1 4r CLERK OF THE COUNCIL CITY OF SANTA ANA