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HomeMy WebLinkAbout94- National Settlement Agreement and Policy release ~ , . j SETTLEMENT AGREEMENT AND POLICY RELEASE This Settlement Agreement and POlicy Release ("Agreement") is entered into by and between Bozeman as defined in paragraph 1. entitled "Definitions", subparagraph a, and National as defined in paragraph 1. entitled "Definitions", subparagraph b. Bozeman and National are collectively referred to as the "Parties", and either may be referenced as a "Party". WHEREAS, National issued a policy of insurance which is comprised of certain forms and endorsements to Bozeman, numbered PE 250008 having original effective dates of 12/1 173 through 12/1174 and being extended and then cancelled effective 7/17175 ("National Policy"); and WHEREAS, Bozeman has received claims and has been named in suits and Directives, hereinafter collectively referred to as the Claims, as defined in paragraph 1. entitled "Definitions" subparagraph c.; WHEREAS, Bozeman has tendered the Claims to National requesting defense and indemnity; WHEREAS, National specifically denies any obligation under the National Policy to Bozeman with respect to the Claims, because National contends that such claims are not covered within the terms and conditions of the National Policy; and WHEREAS, the Parties so as to avoid the costs and risks of litigation and disputes concerning any and all claims under the National Policy including but not limited to the Claims, desire to fully resolve any and all obligations and liabilities National may have under the National Policy for all claims known or unknown, present, past or future and to enter into this Agreement in place and instead of the National Policy; and WHEREAS, the Parties negotiated this Agreement in order to resolve all matters and disputes between them existing now or to arise in the future and to avoid further difficult, prolonged and complicated litigation, this Agreement is entered into in good faith, and is in the public interest; , , NOW, THEREFORE, in consideration of the promises and mutual covenants and agreements and releases herein contained, and for other good and valuable consideration, it is understood and agreed as follows: 1 . Definitions. a. "Bozeman" shall mean the City of Bozeman, a Montana Municipal Corporation, and all other entities or persons listed as insureds under the National Policy, as well as their predecessors, successors and assigns and any and all of their subsidiaries, affiliated, allied and associated companies, corporations, partnerships, proprietorships, joint ventures, foundations, organizations, governmental bodies and associations now or previously existing or hereafter created or acquired, and any and all past, present and future City or other governmental officials, directors, officers, partners, employees, agents, insurers, servants, receivers, stockholders and other representatives including heirs, administrators, executors, assigns, and legal representatives. "Bozeman" shall also mean all other persons or entities claiming any right as an insured, additional insured, loss payee or assignee under the National Policy. b. "National" shall mean National Indemnity Company, as well as its predecessors, successors and assigns and any and all of their subsidiaries, affiliated, allied and associated companies, corporations, partnerships, proprietorships, joint ventures, foundations, organizations and associations now or previously existing or hereafter created or acquired, and any and all past, present and future directors, officers, partners, employees, agents, insurers, servants, receivers, stockholders and other representatives including heirs, administrators, executors, assigns and legal representatives. c. "The Claims" shall mean: (1 ) Jewel Food Stores, Inc.. v. the City of Bozeman et aI., No. CV 92-57-BU (U.S. D.C., MT); 2 , , ; (2) Order to Provide Information and Documentation, Docket No. WQ.90-002; Before the MDHES, dated August 23, 1990; (3) Letter, dated December 31, 1991, authored by MDHES, Director's Office, and addressed to Robert Hawks, Mayor of City of Bozeman, identifying the City of Bozeman as a potentially liable person pursuant to ~ 75-10-711 (3) Mont. Code Ann. for the contamination allegedly found at the Buttrey Shopping Center and Bozeman Solvent Sites in Gallatin County, Montana; and (4) Interim Water Supplv Order, Docket No. WQ-93-1 01; Before the MDHES, dated June 14, 1993, and Amendments thereto, dated June 18, 1993, and December 3, 1993, respectively including but not limited to any cross.claims, counterclaims and third-party suits to the above. 2, Purpose. This Agreement addresses and resolves, by novation of the National Policy and the creation of this Agreement, all present, past, future and potential claims for insurance coverage under the National Policy, includinq but not limited to the Claims. 3. Agreement Not to be Construed as an Admission. The Parties agree that this Agreement is the product of informed negotiations at arms length between and among the Parties, assisted by counsel, and involves compromises. This Agreement shall never, at any time, for any purpose, be considered as an admission of obligation, liability, fault or responsibility on the part of any Party. Bozeman understands and agrees that the settlement embodied herein is a compromise of doubtful and disputed claims and this Agreement, including any payments and/or consideration 3 provided for herein, is not to be construed as an admission of liability on the part of the National, by whom liability is expressly denied. Further, the signing of this Agreement by National does not create and shall not be used as precedent or evidence in any proceeding or hearing to create, prove or interpret the obligations under, or the terms, conditions or exclusions of any other Agreement or insurance policy entered into or issued by National. 4. Novation of the Policies. Upon signing of this Agreement and delivery of the payment described in paragraph 8 below, the Parties shall have no further duties or obligations to each other under the National Policy, and in particular, Bozeman agrees and understands that it has no further rights under the National Policy, including but not limited to rights of defense or indemnity for any purpose. This Agreement is and shall be a novation of and shall supersede the National Policy. 5. Intearated Aareement. This Agreement is the entire Agreement between and among the Parties relating to the subject matter hereof. All prior contemporaneous agreements, oral or written statements, representations, warranties, arrangements, understandings or collateral provisions concerning the negotiation or preparation of this Agreement, as well as any disputes between the Parties regarding the National Policy, are merged and integrated into this Agreement and are without further force and effect. This Agreement may be only modified or amended by mutual agreement of the Parties, in writing, which specifically refers to this Agreement and is signed by both Parties. Bozeman understands, declares and acknowledges that no promise, inducement or agreement not herein expressed has been made to it and that this Agreement contains the entire agreement among the Parties hereto. 4 . 6. Not a Contract of Insurance. This Agreement is not a contract of insurance and the Parties agree that it shall not be interpreted according to any rules of construction particularly applicable to insurance contracts. Each Party has participated in the negotiation and drafting of this Agreement and no Party shall be deemed to be the drafter of this Agreement or of any particular provision hereof, and no part of this Agreement shall be construed against any Party on the basis of that Party's identity or capacity as an insurance company. 7. Reliance on Attorney. Bozeman and National represent that they had full opportunity to retain the attorneys of their choice, and that they have read the terms and conditions of this Agreement and that these terms are fully understood and voluntarily accepted by them. 8. Payment and Dismissal. In consideration for this Agreement, the Policy Release and the novation of the National Policy, National shall pay the sum of Ninety Five Thousand U.S. Dollars ($95,000.00 U.S.), the receipt and sufficiency of which is hereby acknowledged by Bozeman to be paid by draft made payable to The City of Bozeman within ten (10) days of the effective date of this Agreement. 9. Policy Release. In consideration of the promises contained in this Agreement, Bozeman hereby releases, acquits and forever discharges National from any and all actions, claims, demands, suits, liabilities and obligations whatsoever, whether known 5 or unknown, whether past, present or future for relief of any kind, including but not limited to any right or obligation under the National Policy whether of defense, indemnity, punitive, attorney fees, or violation of any state or federal statute or regulation, including any claim of bad faith or improper claims handling or alleged wrongdoing of any kind and specifically including but not limited to the Claims. The Parties acknowledge and represent that the facts as presently known by them may differ from the actual facts and each party assumes the risk of unknown claims and intends to, and hereby does, waive any unknown claims and agrees that this Agreement applies thereto. 10. Policv Release bv Named Insured. As a condition to the obligations of National under this Agreement, Bozeman shall deliver to National, a Policy Release duly executed by Bozeman in the form attached hereto as Exhibit A, under which said entity releases National from any obligations under the National Policy. The Policy Release shall be executed at the time of the signing of this Agreement by Bozeman. 11. Indemnification. Bozeman agrees and covenants not to sue or prosecute claims that it has now or that it acquires in the future under the National Policy. Bozeman further agrees and covenants to hold National harmless from and to indemnify, save and defend National against any and all claims, demands or actions whether in contract, tort or otherwise, brought by any public or private person or entity against National under or based upon the National Policy. This Agreement to hold harmless and indemnify National includes but is not limited to any claim, demand, or action by or on behalf of any other insurance carrier, named insured, additional insured, person claiming to be an insured, third party, property owner, governmental entity or other third person or entity. 6 12. Notice. National shall notify Bozeman of any claim for which it seeks indemnification. If such a claim to which paragraph number 11 entitled "Indemnification" applies is made against National, Bozeman, through its own counsel, approved by National, shall use its best efforts to obtain the dismissal of National and the substitution of Bozeman on the basis that National's alleged obligations under the National Policy were fully and finally resolved by this Agreement. National shall have the right to prior approval with respect to all positions either procedural or substantive, taken by counsel on behalf of National which relate or pertain in any manner to National in any court action. a. National further has the right to defend itself at its own expense, against any and all claims and have its own counsel as lead counsel, but in the event it elects to so defend, such defense shall not act as a waiver or in any way excuse the obligations of Bozeman under this Agreement, including but not limited to paragraphs number 11, 12 and 13, of this Agreement, entitled "Indemnification", "Notice" and "Satisfaction of Judgment", respectively. 13. Satisfaction of Judqment. Bozeman hereby agrees that in the event a judgment(s) is entered against National as a result of any matter to which paragraph number 11 entitled "Indemnification" applies, including but not limited to judgment(s) as a result of cross-claims, counterclaims or third party actions, Bozeman shall immediately and fully satisfy or cause to be satisfied such judgment(s), regardless of whether the amount of the judgment(s) exceeds the settlement payment set forth in paragraph 8 entitled "Payment and Dismissal", 14. Confidentialitv. 7 . This Agreement is confidential and shall not be disclosed to any person or entity, except a) as required by operation of law; b) to any insurers, reinsurers or retrocessonaries of National in connection with insurance or reinsurance obligations; c) to any parent or affiliated company of National; d) to the auditors of Bozeman or National; e) in any action or proceeding where the existence or terms of the Agreement are at issue and a protective order limiting dissemination and disclosure of the Agreement and its terms is granted; and f) by written agreement of both Bozeman and National. If this Agreement or its terms are disclosed as provided above herein, the party disclosing such information shall advise the recipient of the confidentiality provisions of this paragraph. 15. Notices. All notices or other communications which any Party desires or is required to give another Party shall be given in writing and shall be sent by certified mail to such Party at the addresses noted below. 8 . . For Bozeman: Barry G. O'Connell, Esq. Moore, O'Connell & Refling Suite 10 Life of Montana Building 601 Haggerty Lane Bozeman, Montana 59771.1288 For National: Cynthia Sleder Lambert Special Claims Administrator 4016 Farnam Street Omaha, NE 68131 16. No Prior Assianment. The Parties each warrant that prior to and as of the effective date of this Agreement, such Party has not assigned any claims, demands, causes of action or rights under the National Policy to any other person or entity. 17. Authorization. The Parties expressly represent and warrant that each is fully authorized to enter into this Agreement through the representative of said Party whose signature appears at the end of this Agreement. 9 . . . 18. Counteroarts and Effective Date. This Agreement may be signed in counterparts and the effective date will be deemed the latest of the dates of signing by the Parties. 19. Choice of Law. This Agreement shall be construed under the laws of the State of Montana. Date of this qe day of 7J [;G~lr,f32:JL ,1994. Bozeman, an entity defined within the Agr~ . ~ . -ov. ~ its /11 A-7 l:r-r STATE OF jl1()~1I- ) COUNTY OF6;'4L~~ ) ss. ) 1~ ~ On this - day of ,:.CAII1 , 1994, before a Notary Public within and for said County, personally appeared J, j pc&-r---r- , to me personally known, who being duly sworn, did say that she/he has the aut rity to execute this Agreement on behalf of Bozeman, an entity defined Ithin the gr ent, and that said instrument is the free act and deed of said enti - " .: .. " , ," 10 ----- ---- ------ . . . . . . Date of this /JpJ day of f\..e'~~~ ,1994. NA TIO~titY defined within the Agreement by 2t?t0 e "~'?1 C:?~ r;p, ~ ;j its STATE OF NEBRASKA ) ) ss. COUNTY OF DOUGLAS ) On this / i -I jl day of /Jc,"tl..'lnhe> , 1994 before, a Notary Public within and for said County, personally appeared )~i:dic') C <;fJC{f)I, to me personally known, who being duly sworn, did say that she/he has the authority to execute this Agreement on behalf of National, an entity defined within the Agreement, and that said instrument is the free act and deed of said entity. XEllAl NOJARY.stItt" Nelnsb ;!{;Z f? );7;~t'?t/ v MARY A. MOm" II, eo.. &p. ..., 24. I. csl/tj Bozeman 1 1 ~- . ~ . . . . . POLICY RELEASE In consideration of the payment made by National Indemnity Company pursuant to a certain Agreement between it and the City of Bozeman, a Montana Municipal Corporation dated December ~, 1994, the undersigned for itself, its successors and assigns, hereby releases and forever discharges National Indemnity Company its successors and assigns from any and all actions, claims, demands, suits and liabilities whatsoever, whether known or unknown, whether past. present or future for relief of any kind, including but not limited to any right or obligation under a certain policy of insurance issued by National Indemnity Company numbered PE 250008, whether of defense, indemnity, punitive, attorney fees, violation of any state or federal statute or regulation or alleged wrongdoing of any kind, Dated this 1- day of December, 1994. ipal Corporation ?Jl;/~ its EXHIBIT A 12