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Livingston Settles With Library Construction Companies

The long legal battle ends with the township paying $528,000 to ICE.

On Monday, the Livingston Town Council unanimously passed a resolution that settled a lawsuit between the township and Integrated Construction Enterprises, Inc.  ICE is the company that took the lead in renovating the Livingston Public Library.

ICE brought suit against the township alleging it was owed money from the construction, which ended in September 2007. The construction company brought 11 claims against Livingston, totaling more than $2.5 million. The township retained Bob Lawless, a partner at Hedinger & Lawless, LLC, who was able to negotiate the settlement down to $528,000.

“The goal…of litigation of this magnitude, close to $3 million, based on change orders, can take weeks and weeks of trial, which can cost millions of dollars,” said Livingston Mayor Stephen Santola. “So the goal was to separate the wheat from the chaff, see how much was real and then decide if we were going to actually go to battle with an Essex County jury or try to come to some reasonable resolution.”

The project was broken down into two phases. Phase 1 consisted of building a new addition to the library at a cost to the township $5.4 million. Phase 2 was the renovation of the library, which cost $2.3 million. Adding in other costs associated with the project, the overall hard cost for the project was $8.9 million, said Santola.

Phase 1 was scheduled to be completed in March 2005, however, six months of delays caused the project to be finished in December 2005. Following the end of Phase 1, the township passed a resolution that settled all phase 1 delay claims, made by ICE, but left open for reconsideration for any remaining change orders that were not yet resolved, according to Lawless. Those change orders were part of the mix of claims that were dealt with in Phase 2.

Phase 2 started in January 2006, with a targeted end date of October 2006. However, more delays caused the project to be finished in September 2007.

In September 2008, ICE filed suit against Livingston for money the company felt was owed. Livingston in turn, filed a third-party claim against their architect, Dennis Kowal, AIA, for any damages that may be owed to ICE as a result of the lawsuit. Dennis Kowal, AIA, then brought claims against its sub-consultants Fourth Party Defendants, Edwards & Kelsey, Inc., and Consulting Engineers Collaborative, Inc.

“Our analysis, based upon massive amounts of documents, including the financial records, indicated that even if we were right on most things, the township was going to have liability of anywhere between $300,000-$500,000 for change order requests and some other delay-related items,” said Lawless.

Dennis Kowal, AIA, agreed to contribute $340,000 toward the settlement. 

According to Lawless, to win the case, the township would’ve needed 10-15 witnesses and a minimum of 1,000 pre-marked documents to win the trial, which would’ve lasted 14-16 weeks. Lawless said expert fees and additional legal costs would’ve equaled approximately $250,000. The overall cost of the trial to the township would have cost over $500,000.

Before voting, Councilwoman Deborah Shapiro said she thought the township “came to the best settlement we could, for the least amount of money and the maximum amount of return.”

“Bob did a phenomenal job with taking the emotions out of the issue, getting it down to facts and developing the best strategy to deal with (the lawsuit),” said Shapiro.  “At the end of the day, we came to a settlement that everybody may not like, but at least everybody can agree to.”

Councilman Gary Schneiderman, who served on the council when the library plans were first introduced in 1999 called the vote “very, very emotional.”

“If I had my way, I would’ve fought (the lawsuit) forever and ever and that’s the wrong thing to do because of the cost that would be involved,” said Schneiderman, whose council term expires on Dec. 31. “The settlement is the best that it’s going to be and it’s time for me to give it up and enjoy the library.”

Santola, who has served with Schneiderman since 1999 and like the councilman, will be retiring from the council this year, declared this vote was “the hardest vote I’ve ever had to make.

We do realize that this isn’t about where we want to end up with personal issues, but getting to the finish line in the most taxpayer efficient manner,” said Santola.  “So while this is a very, very hard vote, I’m going to vote yes.”

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