More than two years after the $18.8 million La Cañada Drive widening was largely finished, the legal battle that flared up in its wake between Pima County and the main contractor for the project is now largely concluded.
In early April, the Western Surety Co. — acting as the attorney for contractor Select Development and Construction — agreed to a $1.3 million offer from the county, payable to Select but delivered to the surety company.
It was Western, not Select, that accepted a settlement because the contractor failed to either accept it on its own or post $1.1 million in collateral after Western took on sizable losses from “claims paid on this project” and settlements of others, according to letters obtained by the Star through a public records request.
In late 2015, Select filed a lawsuit alleging the county was responsible for a number of costly delays that resulted in the project being extended 132 days. Those delays resulted in nearly $5.6 million in additional costs, which it sought in the suit, along with interest, attorney fees and a final payment of $970,000 held by the county.
The delays were caused by untimely responses to company requests for information, including one request that took the county nine months to respond to, as well by project plan errors, interference from utility companies and sequencing problems, the complaint says.
In its response, the county rejected the company’s claims and said that any delays were caused by the company’s “failures to diligently pursue the work” and “any additional costs … incurred arose from its repeated failures to properly manage the project.”
Pima also countersued, claiming that Select had failed to promptly pay subcontractors and properly report those payments, allegations the company later denied, according to court documents. The final payment was withheld to ensure the company met such contractual obligations.
While the project to widen La Cañada between West Ina and River roads was underway, the county “determined” the company “was not paying certain of the subcontractors and suppliers,” according to the finalized settlement.
County Transportation Director Priscilla Cornelio said the suit had been “a headache for Pima County, and I’m glad it’s all been settled.”
“I think it was a good settlement, in particular for the subcontractors to be paid,” she added.
As a part of the settlement, Western agreed to pay most of the subcontractors with outstanding claims, which exceed $210,000. However, the company has “asserted defenses” to claims made by contractors A&M Fencing and European Pavers.
Matt Gage, owner of A&M, said he’s nevertheless hopeful he’ll see at least a part of his company’s remaining $34,600 claim in the wake of the settlement. However, he said he feels the county should have been more cautious contracting with Select, which he said had previously been accused of not paying subcontractors.
“All that stuff is right there,” he said.
A brief search of Pima County Superior Court records turned up a handful of cases in which subcontractors and other parties sued Select, alleging nonpayment and other issues.
For example, the Antech Corp. sued Select in 2007 for an unpaid balance of over $70,000 in labor, materials and equipment, according to court records. Antech won a judgment in that amount, plus interest and attorney fees. A settlement was reached later.
The county also canceled a $10 million 2013 contract with Select for improvements to Magee Road between La Cañada and North Oracle Road after significant delays and similar complaints from subcontractors, marking the first time the county had ever taken that step on a major project. The La Cañada contract was awarded the year before.
When evaluating bidders, the county does a number of things, including license verification and checking corporate standing through the Arizona Corporation Commission, as well as seeing if they have been debarred from federal projects, according to written comments provided by county Procurement Director Mary Jo Furphy.
In the case of Select, the county “was aware … of past litigation prior to awarding the first contract,” Furphy said. As a result, the county took additional measures, including getting performance references from other companies, which were positive. Additionally, county bonding requirements ensure both that projects get completed — even if a contractor goes under or is otherwise unable to finish a job — and subcontractors get paid.
“There are protections in place,” Furphy said.
The Star attempted to contact Select representatives for comment through a number of means, but was unsuccessful. CNA Financial, Western’s parent company, said it does not comment on litigation.
DOWN THE ROAD
In last week’s column, the Road Runner gave readers the heads-up about an upcoming six-month closure at Interstate 19’s southbound on-ramp at Pima Mine Road starting Monday. On Thursday, ADOT sent an update that the on-ramp “will not be closed for six months beginning Monday, April 17.” The closure is still coming, and an ADOT spokesman said he doesn’t “expect the delay to be too long.”
“It’s just taking a little longer to get things in place for the work,” ADOT spokesman Tom Herrmann told the Road Runner.
On Tuesday, city contractor Markham will install temporary traffic signal wires and take out existing signal poles at the East Grant Road/North Sixth Avenue intersection. The work will take place between 9 a.m. and 1 p.m. Tuesday and Wednesday, during which east and westbound left turn lanes will be temporarily closed and left turns from Grant to Sixth will not be allowed. Right turns will not be impacted. The work is part of Phase 2 of the Grant Road Improvement project.
Early Monday, Tucson Estates Parkway at Arizona 86 (Ajo Way) will close for roughly five weeks to allow for intersection work and new road construction. Access will be maintained with a detour from South Kinney to West Bopp roads.
Also Monday morning, Arizona 86 traffic will be shifted south at the South Camino Verde intersection for lane striping. There will be a similar shift to the north once the striping is complete.
