Loading...
HomeMy WebLinkAboutCC AG PKT 2010-05-10 #G AGENDA STAFF REPORT DATE: May 10, 2010 TO: Honorable Mayor and City Council THRU: David Carmany, City Manager FROM: Sean Crumby, Director of Public Works SUBJECT: AUTHORIZE SETTLEMENT AGREEMENT FOR LAMPSON AVENUE SEWER REPLACEMENT PROJECT NO. SW0901 SUMMARY OF REQUEST: The City Council is asked to adopt Resolution No. 6000 approving a settlement agreement related to contamination from the former Arco Station located at 12800 Seal Beach Boulevard with BP West Coast. BACKGROUND: On September 8, 2008 the City of Seal Beach awarded construction for the SW0901 Lampson Avenue Sewer Replacement project. During the course of construction contaminated soils were encountered on the site. Cleanup of this contaminated soil added $988,712 in additional cost to the project. It was determined that this contamination originated from a former Arco Gas Station that was operated at 12800 Seal Beach Boulevard. The City of Seal Beach and BP West Coast Products have come to an agreement whereby the City is refunded $945,000 (97% of the cost) for the cost of cleanup of contaminated soil. FINANCIAL IMPACT: This action reimburses the City for funds expended toward capital improvement SW0901 Lampson Avenue Sewer Replacement project. RECOMMENDATION: It is recommended City Council adopt Resolution No. 6000 approving a settlement agreement related to contamination from former Arco Station located at 12800 Seal Beach Boulevard with BP West Coast. Agenda Item G Page 2 SUBMITTED BY: NOTED AND APPROVED: Sean Crumby P.E. (, David Carmafiy, City Manager Director of Public Works Attachments: A. Resolution No. 6000 B. Agreement RESOLUTION NUMBER 6000 A RESOLUTION OF THE SEAL BEACH CITY COUNCIL APPROVING A SETTLEMENT AGREEMENT BETWEEN SEAL BEACH ON THE ONE HAND, AND BP WEST COAST PRODUCTS LLC AND ATLANTIC RICHFIELD COMPANY ON THE OTHER HAND The City Council of the City of Seal Beach hereby resolves as follows: SECTION 1. A predecessor to West Coast Products LLC and Atlantic Richfield Company operated a gasoline service station on the property located at 12800 Seal Beach Boulevard in Seal Beach. While conducting construction activities as part of the Lampson Street Sewer Project ( "Project "), City encountered hydrocarbon contamination, which delayed the Project and caused additional costs for the Project. West Coast Products LLC and Atlantic Richfield Company (collectively "BP ") offered to settle all of City's claims related to additional costs related to the Project for $945,000.00. SECTION 2. The City Council hereby approves the Settlement Agreement between the City and BP dated May 10, 2010 and attached hereto as Attachment A, under which the City will receive the amount of $945,000.00. SECTION 3. The Council hereby directs the City Manager to execute the Agreement on behalf of the City. SECTION 4. The City Clerk shall certify to the passage and adoption of this resolution. PASSED, APPROVED and ADOPTED by the City Council of the City of Seal Beach at a regular meeting held on the 10th day of May , 2010 by the following vote: AYES: Council Members NOES: Council Members ABSENT: Council Members ABSTAIN: Council Members Mayor ATTEST: City Clerk STATE OF CALIFORNIA COUNTY OF ORANGE } SS CITY OF SEAL BEACH } I, Linda Devine, City Clerk of the City of Seal Beach, do hereby certify that the foregoing resolution is the original copy of Resolution Number 6001 on file in the office of the City Clerk, passed, approved, and adopted by the City Council at a regular meeting held on the 10th day of May , 2010. City Clerk Final Execution Version SETTLEMENT AGREEMENT AND RELEASE This SETTLEMENT AGREEMENT AND RELEASE (hereinafter the "Agreement ") is made by and between the City of Seal Beach, and its council members, attorneys, agents, employees and assigns (hereinafter collectively, "City "), on the one hand, and BP West Coast Products LLC and Atlantic Richfield Company and their predecessors, successors, parents, subsidiaries, related entities, officers, directors, attorneys, agents, employees and assigns (hereinafter collectively, `BP "), on the other hand, as part of a settlement agreement between City and BP (collectively, the "Parties "). RECITALS (A) City alleges that BP operated a gasoline service station ( "Station 3038 ") on the property located at 12800 Seal Beach Boulevard, Seal Beach, California (the "Seal Beach Lampson Property "); (B) City initiated construction of a sewer upgrade system in the immediate vicinity of the Seal Beach Lampson Property in March 2009 ( "Lampson Street Sewer Project "); (C) While conducting construction activities as part of the Lampson Street Sewer Project, City alleges that it encountered hydrocarbon contamination which it attributes to Station 3038 (the "Occurrence "), and that it incurred costs in connection with the Occurrence as detailed in Exhibit A hereto incorporated by this reference, and that it incurred damages in connection with the Occurrence; 1220998 (D) City claims it has incurred costs in the amount of $988,712.00 (the "Demand ") due to the Occurrence; (E) BP has offered to settle all of City's claims related to the Occurrence for $945,000.00; and (F) The Parties wish to settle the Demand for the Occurrence based upon the terms set forth herein. NOW, THEREFORE, in consideration of the foregoing and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, City and BP hereby covenant and agree that the Recitals above are incorporated into the terms of this Agreement and further agree as follows: AGREEMENT 1. Settlement Amount. For and in consideration of the mutual promises and covenants contained herein, BP shall pay to City the total sum of $945,000.00. 2. Payment. Within 30 days of the execution of this Agreement, BP will tender to City the total sum of $945,000.00 paid pursuant to this Agreement, by means of check issued payable to "City of Seal Beach" with a reference to Station 3038 on the check. Said check shall be delivered to the attention of Quinn Barrow, Esq., attorney for the City at his office located at Richards Watson Gershon, 355 So. Grand Avenue, 40th Floor, Los Angeles, California 90071. Prior to or contemporaneous with execution of this Agreement, City will provide executed federal W -9 and/or state Form 590 tax documents as requested by BP. 1220998 2 3. Release Of Claims. Effective upon receipt of Payment as specified in Paragraph 2 above, City fully and forever releases and discharges BP, and BP fully and forever releases and discharges City, with respect to any dispute, claim, or cause of action arising out of or connected with the Occurrence. The Parties agree that the release provided in this Agreement shall extend and apply to all unknown, unsuspected and unanticipated claims, demands, injuries or damages arising from the Occurrence, and expressly waives any equivalent provision of any statute of the United States or any other state or jurisdiction; provided, however, neither this Agreement nor this waiver is intended to affect any right or claim on the part of the Parties against each other related to any properties other than the Seal Beach Lampson Property, or to any other property owned or operated by BP other than Station 3038, or to rights or claims arising from future discoveries of contamination by City and caused by the operation of Station 3038. 4. No Other Demands. City hereby represents and warrants that it has no other judicial or administrative demands currently pending against BP asserting any claim, or seeking damages or equitable relief in connection with the Seal Beach Lampson Property or the Occurrence or the operation of Station3038. The representation in this paragraph is a material inducement to BP for entering into this Agreement. 5. Indemnity. Effective upon receipt of Payment as specified in Paragraph 2 above, City indemnifies and holds BP harmless against claims by City's contractors, subcontractors, consultants or insurers, or other persons or entities, seeking payment for costs associated with the Lampson Street Sewer Project, the Occurrence or the Demand; provided, however, that City does not indemnify or hold BP harmless against any claims for physical injury caused by exposure to contamination encountered during the Lampson Street Sewer Project. 6. No Admission Of Wrongdoing. The Parties hereby agree, acknowledge and recognize that this settlement is a compromise of denied, disputed, and doubtful claims, and that 1220998 3 nothing contained in this Agreement shall constitute or be treated as an admission of liability or wrongdoing by City or by BP. 7. Warranty Of Non - Assignment. The Parties represent and warrant that they have not assigned or transferred, or purported to assign or transfer, to any person, firm, or corporation whatsoever any claim, debt, liability, demand, obligation, cost, expense, demand, or causes of action covered by this Agreement, and each Party acknowledges and agrees that this warranty and representation is an essential and material term of this Agreement without which none of the consideration received in connection herewith would have been made or delivered. The foregoing warranty and representation shall survive the delivery of this Agreement, and each of the Parties shall indemnify and hold the other harmless (including attorney's fees) from any claims, demands, or causes of action which have been assigned or transferred, or purported to have been assigned or transferred, in violation of the foregoing representation and warranty. 8. Advice of Counsel. The Parties hereto affirm and acknowledge that in executing this Agreement, they have relied upon the legal advice of attorneys, who are the attorneys of their choice. The Parties further acknowledge that they have read this Agreement and have had it explained to them by their counsel, have had sufficient time to satisfy themselves that execution of this Agreement is in their best interests, and that they fully understand, appreciate, and accept the words, terms and their effect. 9. Integration. The Parties hereto affirm and acknowledge that this Agreement is an integrated document which states the entire agreement between City, on the one hand, and BP, on the other hand, that they have executed this Agreement voluntarily and without coercion, and that they have not relied on any prior or contemporaneous written or oral representations extrinsic or collateral to the terms of this Agreement in entering into this Agreement. 1220998 4 10. Modification. This Agreement may be modified only by a subsequent • document in writing, signed by both Parties. 11. Attorneys' Fees. In the event that either party to this Agreernent asserts a claim for breach of the Agreement, the prevailing party, as determined by the court with competent jurisdiction, in any such claim shall be entitled to recover all attorneys' fees and costs incurred in connection with such claim. 12. Further Assurances. The Parties agree to cooperate with each other, including executing any documents that may be necessary to give effect to the provisions of this Agreement. • 13. Counterparts. This Agreement may be executed in any number of counterparts, but all such counterparts shall constitute but one and the same instrument and this Agreement shall become effective upon the execution of counterpart originals hereof by the Parties hereto. 14. Headings. The headings in each paragraph herein are for convenience of • reference only and shall be of no legal effect in the interpretation of the terms hereof. The undersigned have executed this Agreernent on the day and year written below. DATED: May THE CITY OF SEAL BEACH By Its DATED: May, ,2010 BP WEST COAST PRODUCTS LLC and ATLANTIC RICHFIELD COMP AN B Gt- [ , Its f-dl.to ! --1A4 a ne t2.- — et Irv y t 11 t" (Signatures continue) 1220998 5 APPROVED AS TO FORM: DATED: May_, 2010 RICHARDS, WATSON & GERSHON By Quinn Barrow Attorneys for City of Seal Beach DATED: May_ 3 , 2010 BP LEGAL r '` r / By •.,f � t Douglas S. Reinhart Attorneys for BP West Coast Products LLC and Atlantic Richfield Company • • 1220998 6