By KEVIN NEVERS
The Chesterton Utility has settled its lawsuit against The Duneland Group
(DG), the Utility’s former contracted engineering consultant and the designer
of the wastewater treatment plant expansion.
In April 2005, the Indianapolis firm of Drewry, Simmons Vornehm LLP, a
specialist in industrial law, filed that lawsuit against DG on behalf of the
Utility and the Town of Chesterton. In the lawsuit the Utility and the town
asserted claims, relating to the design of the expansion, for breach of
contract, negligence, and breach of warranty of the adequacy of the plans and
At its meeting Monday night, the Utility Service Board voted 5-0 to approve
and sign a “Mutual Settlement and Release Agreement.” That agreement must
also be approved and signed by the Town Council.
The Chesterton Tribune obtained a copy of the agreement after filing a formal
public records request this morning with the Office of Clerk-Treasurer Gayle
Polakowski. Under the terms of that agreement, DG will pay the Town of
Chesterton $275,000, within 14 days of receiving the approved and signed
document, “as full settlement and resolution of all disputes, claims, costs,
and expenses arising out of or relating in any way to the litigation.”
The agreement is explicitly clear on one point: by signing the document no
party is admitting liability of any kind. “It is expressly understood and
agreed that the payment and acceptance of the above-stated settlement
payment, and the releases as hereinbefore described, are not admissions of
liability by any party hereto,” the agreement states.
Associate Town Attorney Chuck Parkinson told the Service Board on Monday that
Drewry, Simmons Vornehm recommended approval of the agreement for a couple of
reasons. For one thing, he said, under the terms of DG’s insurance policy the
cost of legal defense was coming off the face value of the policy. For
another thing, Parkinson said, the final $275,000 figure represents an amount
“over and above the policy’s limits.”
Member Scot McCord expressed his gratitude to both Parkinson’s firm, Harris
Welsh & Lukmann, and to Drewry, Simmons Vornehm, for their work. “Nice job,”
The lawsuit against DG was originally filed in response to allegations made
by the general contractor retained by the Utility to expand the wastewater
treatment plant, Bowen Engineering Corporation of Crown Point, that DG’s
design and engineering of the expansion were flawed, causing numerous delays
and forcing the re-design of a portion of the project and remedial work on
In the end the expansion cost $4,793,544.52, or $585,544.52 more than the
original contract price of $4,208,000, an overrun of nearly 14 percent.
Included in that $585,544.52 figure was a payment which the Town Council, in
December 2005, authorized the Utility to make to Bowen, to resolve the
latter’s claim for $1,202,404.92, “primarily for costs and damages allegedly
arising out of design errors, omissions of, and constructive changes caused
by the original project engineer, Duneland Group.”
In other business, the Service Board agreed by consensus to ask
Superintendent Steve Yagelski and Town Engineer Mark O’Dell to submit a list
of pressing projects in need of prioritization. Members made that request
after Yagelski informed them that the Porter County Highway Department has
asked to re-locate a form main currently buried beneath the concrete of the
bridge over Coffee Creek on Indian Boundary Road. “That’ll be a $50,000
project,” O’Dell said, at a minimum. More to the point, it will require a
fair amount of drawing-board time, and to clear some space for it O’Dell was
interested in knowing whether the Service Board would be comfortable in
postponing one more time the separation of the sanitary and stormwater system
beneath South Calumet Road in the Downtown. The new main installed last
winter, to replace a collapsed line, appears to be working well, O’Dell said,
while the need to separate the sanitary and stormwater sewers is perhaps less
pressing than some other projects.
Yagelski and O’Dell agreed to submit a project list at the next meeting, Dec.
Re: Dickinson Road Lift Station
Meanwhile, members voted 5-0 to recommend to the Town Council the purchase of
a quarter acre of property, at the southeast corner of East Porter Ave. and
Dickinson Road, for a price not to exceed $43,250, the average of two
appraisals of the land in question.
That property will be needed for the upgrade of the Dickinson Road lift
station, which the Lake Erie Land Company is obligated to perform at its own
expense. But the land on which the lift station is located—and the land on
which it will be expanded—must be owned by the Utility itself.
Members also voted 5-0 to permit Yagelski to increase the number of
authorized wastewater treatment plant operators from two to three and to
advertise to fill the newly created position.
Yagelski asked for that authorization to get a new operator in place and
trained in advance of the likely retirement in the next few years of a senior
Re: Sludge Conveyor
And members voted 5-0 to authorize the purchase and installation, at a cost
not to exceed $20,000, of a new screw conveyor system to move pressed
bio-solids to a truck or a storage area.
The current Serpentix conveyor system is in need of $38,000 worth of repairs,
Yagelski said, and the new screw system would be cheaper to buy and install.
And, he added, it would do the job better.
October in Review
In October Chesterton used 46.18 percent of its 3,794,400 gallons per day (gpd)
allotment at the wastewater treatment plant; Porter, 60.93 percent of its
725,000 gpd allotment; the Indian Boundary Conservancy District, 64.50
percent of its 81,000 gpd allotment; and the plant as a whole, 48.83 percent
of its capacity. There were no bypasses recorded last month. In October the
Utility ran a deficit of $181,666 and in the year-to-date is running a
deficit of $234,511.