Repository: UIHistories Project: Board of Trustees Minutes - 1962 [PAGE 1202]

EXTRACTED TEXT FROM PAGE:

1961]

With Whom E. T. Drewitch (Plastering) M. E. Hollett Total

UNIVERSITY OF I L L I N O I S

1199

Amount $490 24 (deduct) 47 68 fM2 56 (deduct) Dale September and October, 1961 October, 1961

Adjustments Made in 1961-62 Cost-Pius Contracts

Purpose Fourteen items: £957.41 deduct to $136.67 Painting

This report was received for record.

QUARTERLY REPORT OF THE COMPTROLLER (20) The Comptroller presented his quarterly report to the Board as of September 30, 1961.

This report was received for record and a copy has been filed with the Secretary of the Board.

SETTLEMENT WITH PATRICK WARREN CONSTRUCTION COMPANY (21) In December, 1949, the University entered into a contract with Patrick Warren Construction Company (hereinafter termed " W a r r e n " ) for the performance by the latter of the general work in connection with the construction of the addition to the Research and Educational Hospitals at Chicago. The provisions of the contract contemplated the completion of the building in May, 1951; but, in consequence of numerous delays which developed from time to time, some of the work remained undone in July, 1953, with the result that the University, in order to expedite the completion of the building, assumed the then unfinished portion of Warren's work in return for a credit allowed the University by Warren. At that time Warren had not paid the balances due a considerable number of its subcontractors for the work done and materials furnished by them. Since then, the University, with Warren's consent, has paid, out of funds it was withholding from payment to Warren, the balances owed those subcontractors by Warren in return for credits allowed the University by Warren. As the result of the last such payment, which was made to the partnership known as Crouch-Walker Company about three months ago, the unpaid balance under the contract between Warren and the University is now $49,330.34. In addition to its claim for the payment to it of that balance, Warren, upon the theory that the University is legally responsible for the above-mentioned delays, asserts substantial claims against the University for increased costs and damages Warren claims it has sustained, and may in future sustain, in consequence of them. On the other hand, the University asserts it is entitled to certain credits, which Warren has refused to allow, upon the contract and also asserts claims against Warren for damages for the delays for which the University claims Warren was both actually and legally responsible. The University denies liability to Warren upon the latter's last-mentioned claims, and W a r r e n denies liability to the University upon its claims against Warren. The details of these claims are more fully stated in a letter from Mr. Lesemann to President Henry of which a copy is being filed with the Secretary for record. As the result of negotiations recently conducted between counsel for W a r r e n and counsel for the University, W a r r e n has now agreed to accept the sum of $81,042.07 and a release by the University of all of the latter's claims against Warren in full payment and satisfaction of all of Warren's claims against the University and to deliver to the University a full and complete release of all claims, and release and waiver of all liens, which Warren may have or assert against the University. Litigation of the claims asserted by Warren against the University, and those asserted by the latter against Warren, which appears inevitable if claims are not settled and disposed of on the foregoing basis, would be protracted and complicated and would result in serious inconvenience and very substantial expense to the University. For these reasons, the Vice-President and Comptroller, the Director of the Physical Plant, the Legal Counsel, and Special Counsel (Albert E. Tenner, Jr., and Ralph F. Lesemann), who have been handling these matters for the University, recommend that a final settlement between the University and Warren on the above-mentioned basis be authorized and made, and