HomeMy WebLinkAboutMINUTES - 05111993 - 1.76 76O
TO: BOARD OF SUPERVISORS
FROM: COUNTY COUNSEL
DATE: May 7 , 1993
SUBJECT: SETTLEMENT OF LAWSUIT AGAINST SECURITY INSURANCE COMPANY OF HARTFORD
(Asbestos Abatement at Mt. Diablo Municipal Court, Concord)
SPECIFIC REQUEST(S) OR RECOMMENDATIONS) & BACKGROUND AND JUSTIFICATION
RECOMMENDATIONS
APPROVE settlement of County's lawsuit against Security Insurance
Company of Hartford and AUTHORIZE County Counsel 's Office to sign
Release, Assignment and Subrogation and to take other actions
necessary to finalize the settlement and dismissal.
FISCAL IMPACT
$4, 916. 60 payable to the County. Funds received will be applied to
the account established for the subject project.
BACKGROUND/REASONS FOR RECOMMENDATIONS
A. On October 15, 1992, General Industrial Insulation, Inc.
("General") submitted the low bid for Asbestos Abatement at
the .Mt. Diablo Municipal Court, located at 1950 Parkside
Drive, Concord, and provided a bid bond which would be
forfeited if the bidder refused to enter into a contract or to
furnish the necessary bonds.
B. On November 17, 1992, a contract was awarded to General in the
amount of its low bid ($49, 166. 00) .
C. General failed to furnish a faithful performance bond and a
payment bond as . required by state law and the project
specifications. General was notified in writing that such
failure would result in the forfeiture of General's bid bond.
D. On February 9,1993, the Board canceled the contract award to
General, declared the forfeiture of General's bid bond in the
amount of 10% of General's bid (i.e. , 10% x $49, 166. 00 =
$4 , 916. 60) , and awarded the contract to the second bidder,
Precision Works, Inc.
E. Despite written . demand from the County, General and its
surety, Security- Insurance Company of Hartford ("Hartford") ,
failed to make payment under the bid bond.
F. On April 20, 1993 , the Board authorized and ratified the
filing of a lawsuit against General and Hartford to recover
the amount payable under the bid bond. The lawsuit was filed
on April 14, 1993 to protect a six-month statute of
limitations. : `
CONTINUED ON ATTACHMENT: X YES SIGNATURE ,j /J�
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RECOMMENDATION OF COUNTY ADMINISTRATOR _ RECOMMENDATION OF BOARD COMMITTEE
APPROVE OTHER
SIGNATURE(S): Q
ACTION.OF BOARD ON �Y� &0 //, �7 9-3 APPROVED AS RECOMMENDED /OTHER
VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A TRUE
AND CORRECT COPY OF AN ACTION TAKEN
UNANIMOUS (ABSENT AND ENTERED ON THE MINUTES OF THE BOARD
AYES: NOES: OF SUPERVISORS ON THE DATE SHOWN.
ABSENT: ABSTAIN: ATTESTED 5-11-9 3
Contact: David F. Schmidt (510) 646-2057 PHIL BATCHELOR, CLERK OF
cc: CAO THE BOARD OF SUPERVISORS
County Counsel AND COUNT ADMINISTRATOR
General Services - Arch. Div.
B.Y , DEPUTY
ZVI
SETTLEMENT OF LAWSUIT AGAINST SECURITY May 7, 1993
INSURANCE OF HARTFORD (Mt. Diablo Municipal
Court, Concord)
G. Hartford has now offered to settle the lawsuit by paying to the County
the full amount of the bid bond ($4,916. 60) . As a condition of the
settlement, the County would be required to release Hartford and to
assign to Hartford the County's claim against General.
H. The proposed settlement would result in full payment to the County.
Both the General .Services Department and the County Counsel' s Office
recommend approval of the settlement.
CONSEQUENCES OF NEGATIVE ACTION
The lawsuit would continue at additional expense to the County.
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