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Agenda 06/27/2023 Item #16K 6 (Settlement Agreement and Release v. Mammoth Constructors, LLC)16. K.6 06/27/2023 EXECUTIVE SUMMARY Recommendation to approve and authorize the Chairman to execute a Settlement Agreement and Release in the amount of $950,000 payable to Collier County to settle the cases of Collier County v. Mammoth Constructors, LLC (Case No. 2021-CA-000132), now pending in the Circuit Court of the Twentieth Judicial Circuit in and for Collier County, Florida concerning the County's claim for damages to a 24" wastewater force main and the related case of Amerisure Mutual Insurance Company v. Mammoth Constructors, LLC, and Collier County (Case No. 2:23-cv-00108-JLB-KCD) now pending in the Federal District Court for the Middle District of Florida, an action for declaratory relief regarding Amerisure's coverage for the loss. OBJECTIVE: Board approval of proposed Settlement Agreement and Release in the amount of $950,000 payable to Collier County which will settle two related cases. CONSIDERATIONS: On January 12, 2021, the Board authorized the County Attorney's Office to file a civil action to recover damages against Mammoth Constructors in connection with damage to a Collier County force main during work on Federal Project ID 433173-1-52-01. Mammoth Constructors was drilling a shaft for the foundation of a new signal mast on the northwest corner of Davis Boulevard and County Barn Road when it struck a County 24" wastewater force main causing significant damage and a release of raw sewage. The County Attorney's Office and Public Utilities Department engaged outside counsel, Paul Ullom of Carlton Fields, to recover damages of $654,562. The parties participated in Court -Ordered mediation but were unable to reach a proposed settlement. The County filed a Proposal for Settlement in the amount of $480,000 to enable the County to collect attorney's fees and costs should the County be the prevailing party at trial. The case was scheduled on two prior trial calendars and was finally proceeded to a jury trial on Tuesday, May 30'. During the trial, settlement negotiations continued between the parties. On Thursday, June l't, following a mistrial in Court, the parties reached a proposed settlement of $950,000 payable to Collier County from Mammoth Constructors and its insurance company Amerisure Mutual Insurance Company. Settlement of this case will also settle a related case filed by Amerisure in the Federal District Court for the Middle District of Florida styled Amerisure v. Mammoth Constructors, LLC and Board of County Commissioners of Collier County (Case No. 2:23-cv-00108-JLB-KCD). Amerisure filed an action seeking a declaration from the Court as to Amerisure's obligation under the contract of insurance issued to Mammoth to determine whether the insurance company was required to cover the loss at issue. The federal case was previously stayed by agreement of the parties pending the outcome of the circuit court trial which ended on June 1. The attached Settlement Agreement and Release presented for the Board's approval provides as follows: - Amerisure shall pay to the County Five Hundred Fifty Thousand Dollars ($550,000) on behalf of Mammoth within twenty (20) days of execution of this Agreement; - Mammoth shall pay to the County Four Hundred Thousand Dollars ($400,000.00) within forty-five (45) days of execution of this Agreement; - Within 10 calendar days of receipt of the Settlement Payments as described herein, and an Agreement fully executed by the Parties, the County shall dismiss all claims against Mammoth in the Litigation, with prejudice and with each Party to bear their own respective attorneys' fees and costs. - Within 10 calendar days of receipt of the County's dismissal of claims in the Litigation, Amerisure shall dismiss all claims against Mammoth and the County in the Coverage Action, with prejudice and with each Party to bear their own respective attorneys' fees and costs. - The Settlement Agreement also contains a comprehensive release to resolve all the disputes and claims that have and could have been brought arising out of and relating to the lawsuit and coverage action including any all claims for attorneys' fees and costs. Packet Pg. 1551 16. K.6 06/27/2023 The County Attorney's Office, Public Utilities Department, and outside counsel, Paul Ullom of Carlton Fields, support this proposed Settlement Agreement and Release to provide certainty to the County and to settle the two related cases. As always, there is risk and uncertainty to proceeding with further litigation of either of the two cases, including facing a potential appeal should the County prevail at trial. This settlement provides certainty and limits further exposure of costs and attorneys' fees. FISCAL IMPACT: The County incurred $645,157.09 in damages due to the force main break; incurred approximately $496,500 in attorneys' fees; and $35,514.60 in costs to date. The net cost to the County is a loss of approximately $225,671; this amount will certainly increase as trial costs have not yet been calculated as the case ended on Thursday, June 1, 2023. Settlement funds in the amount of $950,000 will be deposited as follows: $645,157.09 for the repairs to the Public Utilities Administration Fund (4008) and the remainder of $304,842.91 will be deposited into Wastewater User Fee Capital Project Fund (4014) for attorneys' fees and costs. GROWTH MANAGEMENT IMPACT: None. LEGAL CONSIDERATIONS: This Settlement Agreement and Release have been reviewed by the County Attorney's Office and Carlton Fields. This settlement is reasonable based on the totality of the circumstances. This item is approved as to form and legality and requires a majority vote for Board approval. - CMG RECOMMENDATION: For the Board to approve and authorize the Chairman to execute a Settlement Agreement and Release in the amount of $950,000 payable to Collier County to settle the cases of Collier County v. Mammoth Constructors, LLC (Case No. 2021-CA-000132), now pending in the Circuit Court of the Twentieth Judicial Circuit in and for Collier County, and the related case of Amerisure Mutual Insurance Company v. Mammoth Constructors, LLC, and Collier County (Case No. 2:23-cv-00108-JLB-KCD) now pending in the Federal District Court for the Middle District of Florida. Prepared by: Matt McLean, Collier County Public Utilities Department Engineering & Project Management Division Colleen M. Greene, Managing Assistant County Attorney ATTACHMENT(S) 1. Settlement Agreement Mammoth Constructors signed (PDF) Packet Pg. 1552 16. K.6 06/27/2023 COLLIER COUNTY Board of County Commissioners Item Number: 16.K.6 Doe ID: 25857 Item Summary: Recommendation to approve and authorize the Chairman to execute a Settlement Agreement and Release in the amount of $950,000 payable to Collier County to settle the cases of Collier County v. Mammoth Constructors, LLC (Case No. 2021 -CA-000 132), now pending in the Circuit Court of the Twentieth Judicial Circuit in and for Collier County, Florida concerning the County's claim for damages to a 24" wastewater force main and the related case of Amerisure Mutual Insurance Company v. Mammoth Constructors, LLC, and Board of County Commissioners of Collier County (Case No. 2:23-cv-00108-JLB-KCD) now pending in the Federal District Court for the Middle District of Florida, an action for declaratory relief regarding Amerisure's coverage for the loss. Meeting Date: 06/27/2023 Prepared by: Title: Legal Assistant — County Attorney's Office Name: Wanda Rodriguez 06/14/2023 10:42 AM Submitted by: Title: County Attorney — County Attorney's Office Name: Jeffrey A. Klatzkow 06/14/2023 10:42 AM Approved By: Review: Engineering and Project Management Matthew McLean Additional Reviewer Public Utilities Operations Support Joseph Bellone Additional Reviewer Public Utilities Department Andrew Youngblood Additional Reviewer Public Utilities Department Drew Cody Level 1 Division Reviewer Public Utilities Department George Yilmaz Level 2 Division Administrator Review County Attorney's Office Colleen Greene Level 2 Attorney Review Corporate Compliance and Continuous Improvement Megan Gaillard Office of Management and Budget County Attorney's Office Community & Human Services County Manager's Office Board of County Commissioners Debra Windsor Level 3 OMB Gatekeeper Review Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Maggie Lopez Additional Reviewer Amy Patterson Level 4 County Manager Review Geoffrey Willig Meeting Pending Completed 06/14/2023 1:44 PM Completed 06/19/2023 11:25 AM Completed 06/19/2023 11:33 AM Completed 06/19/2023 11:33 AM Completed 06/19/2023 2:15 PM Completed 06/19/2023 4:57 PM Additional Reviewer Completed 06/19/2023 5:05 PM Completed 06/20/2023 8:20 AM Completed 06/20/2023 8:55 AM Completed 06/20/2023 8:58 AM Completed 06/21/2023 11:35 AM 06/27/2023 9:00 AM Packet Pg. 1553 16.K.6.a SETTLEMENT AGREEMENT AND RELEASE THIS SETTLEMENT AGREEMENT AND RELEASE (hereafter "Agreement") is gyred between and among the Board of County Commissioners of Collier County, ida (the "County"), Amerisure Mutual Insurance Company ("Amerisure"), and nmoth Constructors, LLC ("Mammoth") (the parties to this Agreement may be rred to hereinafter individually as "Party" and/or collectively as "Parties") out of the re to finally and fully resolve the disputes as between and among the Parties as set i below. RECITALS WHEREAS, this dispute arises out of damage caused to an underground 24-inch diameter wastewater force main utility pipe owned, operated .and maintained by the County, on the night of January 31, 2017, at the northwest corner of Davis Boulevard and County Barn Road/Glen Eagle Boulevard in Naples, Florida ("the Intersection"), and the resulting repair of said force main, and includes, but is not limited to, the County's claims th4t it has suffered property damage. WHEREAS, the Florida Department of Transportation ("FDOT") was the owner of a oad construction project ("the FDOT Project") that involved, among other things, the in tallation of four new traffic signals at the four corners of the Intersection. WHEREAS, Preferred Materials, Inc. was the general contractor for the FDOT Project. Preferred Materials, Inc. subcontracted with Highway Safety Devices, Inc. for tZc signalization services. WHEREAS, Mammoth was a sub -sub -contractor to Highway Safety Devices, Inc. the Project, contracted to install the four new traffic signals at the Intersection. WHEREAS, on or about January 15, 2021, the County filed a lawsuit against Mammoth, styled Board of County Commissioners of Collier County, Florida v. Mammoth Constructors, LLC in the Circuit Court of the Twentieth Judicial Circuit in and for Collier County, Florida, Case No. 2021-CA-000132 (the "Litigation"). WHEREAS, Mammoth denied all allegations of liability and raised certain defenses in Ithe Litigation, including comparative fault of the County and/or its agents. WHEREAS, Amerisure, which insured Mammoth, filed suit against Mammoth and th s County, seeking a declaration from the Court as to Amerisure's obligation under a contract of insurance issued to Mammoth (the "Coverage Action"). The Coverage Action was styled Amerisure Mutual Insurance Company, Plaintiff v. Mammoth Constructors, LLC and Board of County Commissioners of Collier County, Florida, Defendants, in the United States District Court, Middle District of Florida, Fort Myers Division under Case No. 2:23-CV-00108-J LB -KC D. 133125328.5 Packet Pg. 1554 16.K.6.a WHEREAS, the County, Amerisure and Mammoth wish to resolve all of the disputes and claims that have and could have been brought arising out of and related to the Litigation and the Coverage Action, and have agreed to do so as to avoid the uncertainties and vicissitudes of litigation. NOW THEREFORE, for and in consideration of the promises and mutual covenants and agreements herein contained, and other good and valuable consideration, th'e receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree to th'e following: 1. TERMS. A. Recitals Incorporated. All of the foregoing Recitals are hereby incorporated by reference as part of this Agreement. B. Definitions: a) "County" means the Board of County Commissioners of Collier County, Florida, including its respective past, present and future, direct and indirect commissioners, partners, subsidiaries, affiliates, parent entities, divisions, districts, agencies, joint ventures, employees, officers, directors, shareholders, principals, agents, attorneys, representatives, constituent members, predecessors, successors, and/or assigns. b) "Mammoth" means Mammoth Constructors, LLC and each of its respective insurers including but not limited to Amerisure Mutual Insurance Company, its current, former, and future owners, shareholders, directors, officers, employees, laborers, reinsurers, agents, adjusters, contractors, servants, representatives, partners, affiliates, joint ventures, affiliated entities, parent companies, subsidiaries, related companies, members, board members, managers, and attorneys, and each of their respective predecessors, successors, heirs and assigns. C. Settlement Payments. 1. Within the time frames laid out below of execution of this Agreement by the County and Mammoth, Mammoth and its insurer, Amerisure, shall pay, or cause to be paid on their behalf, to the County the respective amounts (the "Settlement Payments") as follows; a. Amerisure shall pay to the County Five Hundred Fifty Thousand Dollars and No Cents ($550,000.00) on, behalf of Mammoth within twenty (20) days of execution of this Agreement; 2 131125328.5 Packet Pg. 5571 16.K.6.a b. Mammoth shall pay to the County Four Hundred Thousand Dollars and No Cents ($400,000.00) within forty-five (45) days of execution of this Agreement. 2. All payments shall be made by check payable to "Collier County Board of County Commissioners" and mailed to: County Attorney's Office Attn: Colleen Green Harmon Turner Bldg. 3299 Tamiami Trail East, Suite 800 Naples, FL 34112 3. The payment obligations of each Party set forth above are several, not joint. Each Party's several liability is limited to the respective amounts set forth in their respective Settlement Payments. The Parties agree that the timing of delivery of the Settlement Payments as reflected in Sections l(C)(1)(a) and I(C)(1)(b) of the Agreement are material terms. Time is of the essence under this Agreement. Unless otherwise expressly agreed in writing by the Parties, failure to make a timely and complete Settlement Payment under Section I(C)(1)(a) and I(C)(1)(b) above shall constitute a material breach of this Areement. C. Dismissal of the Litigation and Coverage Action: Within 10 calendar days of o receipt of the Settlement Payments as described in Section I(C)(1)(a) and I(C)(1)(b), and E an Agreement fully executed by the Parties, the County shall dismiss all claims against Mammoth in the Litigation, with prejudice and with each Party to bear their own respective attorneys' fees and costs. E Within 10 calendar days of receipt of the County's dismissal of claims in the Litigation, Amerisure shall dismiss all claims against Mammoth and the County in the a Coverage Action, with prejudice and with each Party to bear their own respective attorneys' fees and costs. E II, :ASSIGNMENT AND RELEASES. cn A. Releases: In consideration of the Settlement Payments and the promises and E mutual covenants contained in this Agreement, the sufficiency of which is hereby acknowledged, and except for the obligations created by this Agreement, the County hereby releases, waives, remises, acquits and discharges Mammoth and its insurer from a any and all past, present, and future "claims" (as that term is defined below), from now until eternity, made by, or which could have been made by, the County concerning, portaining to, arising out of, or related to the Litigation, and the claims raised in the Ccunty's Complaint and all amendments thereto. 3 133125328.5 Packet Pg. 1556 16.K.6.a "Claim" or "claims," as used herein, means all past, present or future, actual or threatened, suspected or unsuspected, claims, rights, liabilities, demands, injuries, statutory, regulatory or other obligations, third -party claims, cross claims, requests, administrative proceedings, counts, cause and causes of action, lawsuits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, (oral or written), controversies, agreements, promises, misrepresentations, deceit, fraud, fraud in the inducement, unfair and deceptive trade practices, breach of fiduciary duties, concealment, failure to communicate, disclosure, failure to disclose, negligent design, negligent misrepresentation, acts, omissions, representations, rights of restitution, rights of rescission, variances, trespasses, damages, judgments, executions, liens, attachments, costs, interest, expenses, directives, warranties or any other cause of action, assertion of liability or order of any kind, whether legal or equitable, and whether currently known or unknown, fixed or contingent, matured or un-matured, liquidated or ur-liquidated, direct or consequential, foreseen or unforeseen, latent or patent, whether or:not accrued, punitive or exemplary, violations, statutory violations, and/or other causes of action, whether based on theories of assignment, subrogation, contribution, equitable subrogation, equitable contribution, equitable indemnity, contractual indemnity, common layv indemnity, breach of contract, negligence, property damage, consequential damage, personal property, real property, personal injury, loss of use, wage loss and/or earning impairment, express warranty, implied warranty, Violation of Building Code, actions or claims for insurance coverage, additional insured coverage, insured contract coverage or insurance benefits (whether against the insured or against the carrier), defense or litigation costs, indemnification of any kind, breach of duty or obligation, breach of the dujty to defend or indemnify, improper defense or settlement practices, statutory bad faith, common law bad faith, extra -contractual claims under §§624.155 or 626.9541, Fla. Stat, or any statutory, equitable or common law theory of any jurisdiction, extra -contractual damages, violation of any duty of good faith and fair dealing, unfair claims handling or any other insurer misconduct, and/or any and all claims for attorneys' fees or costs assessed under common law or any statute, including but not limited to §627.428 Fla. Stet., §626.9373, Fla. Stat. and/or confession of judgment doctrine that were asserted in c>r Could have been asserted in or arise from or relate to the Litigation. B. Releases by Mammoth and Amerisure. Mammoth and Amerisure, on behalf of themselves, and their past, present and future attorneys, agents, servants, contractors, su} contractors, suppliers, representatives, insurers, successors in interest, and assigns of all of them, shall release and forever discharge each other and the County, its affiliates, subsidiaries, related companies, predecessors, successors and/or assigns, subcontractors or affiliates, employees, former employees, agents, attorneys, officers, dirbctors, principals, shareholders, and members, including, without limitation, the Collier County Public Utilities Engineering and Project Management Division, the Collier County Water -Sewer District Engineering and Project Management Division, and the Collier County Water -Sewer District from any and all claims of whatever nature or description, whether now known or arising in the future, and whether arising from contract, indemnity, warranty, express or implied, in contract or tort, relating to the Litigation, including claims for' attorneys' fees, court costs, or related expenses arising out of or related to the Litigation. E Packet Pg. 1557 16.K.6.a C. Claims By and Against Others: No provision of this Agreement is intended to Eit the claims the County or Mammoth may pursue against non -released parties. Illy. ADDITIONAL TERMS AND CONDITIONS. A. No Admission of Liability or Coverage. The Parties understand and agree that the aforementioned monetary consideration is not to be construed as an admission of liability or wrongdoing on the park of any of the Parties, all of whom expressly deny se me, or an admission of coverage by any of the insurers or waiver of any policy pr visions, or a confession of judgment by any of the Parties or any of the Parties' insurers, B. Representation of Comprehension of Documents. The Parties acknowledge that this Agreement is freely and voluntarily executed, and that the Parties have had a full opportunity to read the contents of this Agreement and have had the benefit of counsel in reviewing and entering into said Agreement. The Parties acknowledge that the Agreement has been translated to him/her/them/it in a language of his/her/their/its chi osing and that this Agreement has been completely read and understood. C. Capacity to Execute. The Parties hereto declare, covenant, and warrant that hi /her/theylit and/or his/her/their/its undersigned representatives are over the age of eighteen (18) years, and that his/her/they/it is/are not suffering from any legal, mental, or ph sical disabilities which would impair or disable himlher/them/it from executing this Agreement and that there have been no representations and/or statements made by any of the Parties hereto or any other of the Parties' agents, insurers, employees, or representatives to influence them in making or executing this Agreement. The Parties fu her declare, covenant, and warrant that the individuals executing the Agreement on each Party's behalf have the requisite authority to do so and to bind said Party to the ter s of this Agreement; provided, however, that this Agreement is subject only to the Bo rd of County Commissioners of Collier County, Florida approving the Agreement at its my noticed meeting of June 27, 2023. D. Choice of Law. This Agreement shall be deemed to have been executed and del vered within the state of Florida, and the rights and obligations of the Parties shall be construed and enforced in accordance with, and governed by, the laws of the state of Flo ida without regard to principles of conflict of laws. E. Enforcement of Agreement. In the event of any pleading, motion, or hearing to nforce the terms of this Agreement, the prevailing party shall be entitled to an award of ttorney's fees for services in enforcing same from the party or parties whose conduct ne essitated the pleading, motion, or hearing. The Parties shall and hereby submit that juri diction and venue with respect to the forum for enforcement of the Agreement shall be he forum in which the Litigation was filed. 133t 5328.5 5 Packet Pg. 1558 16.K.6.a F. Complete Agreement. The Parties acknowledge and agree that no promise or a I reement not herein expressed has been made, that the terms of this Agreement are contractual and not mere recitals, and that there is no agreement or compromise on the part of any of the Parties hereto to do any act or things not herein mentioned. This Agreement constitutes and represents the entire agreement between the Parties hereto and supersedes all prior and contemporaneous agreements, negotiations, representations, warranties and understandings of the Parties with regard to the subject matter set forth herein. In the event that any term or provision of this Agreement is d emed unenforceable or unlawful for any reason, the remainder of the Agreement shall be deemed enforceable and in effect. The Parties acknowledge and agree that this Agreement is subject only to the Board of County Commissioners of Collier County, Florida approving the Agreement at its duly noticed meeting of June 27, 2023. G. Signatures and Counterparts. A facsimile or scanned signature of any party to this Agreement shall be sufficient for all purposes, including enforcement. Additionally, it s agreed that this Agreement may be signed in counterparts. H. Modifications. No supplement, modification, or amendment of this Agreement stall be binding unless executed in writing by the Parties. No waiver of any provisions of th s Agreement shall be deemed to constitute a waiver of any other provision, whether similar or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall bg binding unless set forth in writing signed by the Party making the waiver_ I. ovenant Not to Sue. The Parties covenant and agree that they have not, and shall nc t, bring any other claim, action, suit, or proceeding against each other arising out of or re ated to the Litigation or the matters settled and released by this Agreement. Nothing in this covenant not to sue shall preclude a Party from prosecuting claims against any parson or entity who is not a party to this Agreement or who is not expressly released h re, and nothing in this covenant shall prevent any Party from bringing an action to enformce the terms of this Agreement. SIGNATURES ON FOLLOWING PAGES 0 1125328.5 Packet Pg. 1559 16. K.6.a IN WITNESS WHEREOF, the Parties have entered into this Agreement and this nent is effective and binding upon the Parties. ,voun'EV: Mammoth: loard of County Commissioners of Collier Mammoth Constructors, #_LC :aunty, Florida signature Signature 1 A rinted Name Printed Name ')rte S I'd e /U / itle Title ate Date _ Amerisure: ATTEST Amerisure Mutual Insurance Company CRYSTAL K, KINZEL, CLERK BY: y` i Signature as to form and legality County Attorney 7 Jill Chesney Printed Name Sr_ Technical Claims Specialist Title 6/8/23 Date 13�125328.5 Packet Pg. 1560