Marysville school district paid $215,000 to settle construction lawsuit

REM Construction was paid $215,000 by the Marysville Joint Unified School District — and $75,000 by architects — to settle a lawsuit the Butte County company filed in connection with work at Yuba Feather Elementary School.

The school district ended its contract with REM Construction of Paradise on the project that included installing a portable generator and chain link fencing at the Challenge school in the Yuba foothills.

REM had said its construction work was delayed by a PG&E review of the engineering design for the project. The company also cited problems with plans prepared by architects in El Dorado County for the project, including a propane tank not being located as depicted.

The construction company, as part of the settlement, can state that the termination of the $478,384 contract was not for cause.

Marysville Joint Unified provided the settlement agreement after the Appeal-Democrat made a California Public Record Act request for the agreement.

Mark Allgire, assistant superintendent for business services at Marysville Joint Unified, said Monday he could not comment on the matter.

"It's a confidential settl ment," Allgire said. "We have adhered to the terms of the agreement. That's all I can say."

David Schell, president of the construction firm, said Monday he could not comment because of the confidential nature of the agreement.

A clause in the settlement states that the agreement will remain confidential but can be disclosed if a public records request is made to the school district.

The school district in a March 2008 letter from its attorney said it was ending the contract because the Yuba Feather project was more than two months late and had been scheduled for a January completion. Wright One Electric in Yuba City, a subcontractor on the project, completed the work, according to the district.

School district trustees approved the settlement March 22. Schell had told trustees on Jan. 11 that he wanted to make sure they were aware REM had offered a settlement. The company had sought $350,000 to settle its lawsuit, according to a court document. The figure included $140,000 in legal costs.

Jeff Boom, president of the board of trustees, had told Schell that members could not discuss litigation.

"These are matters that are discussed in closed session and cannot be made public at this time," Boom had said.

Trustees in 2008 had rejected a claim filed by REM against the school district contending Marysville Joint Unified improperly terminated the contract for the Yuba Feather Elementary work. The construction company filed a lawsuit in Yuba County Superior Court in 2009. Marysville Joint Unified and the architects denied the allegations.

The school was built in 1954 in the community whose population now totals about 2,000.

REM still has a separate pending lawsuit against the school district in connection with modernization work it undertook in a $2.4 million contract involving Arboga, Cordua, Ella, Johnson Park and Olivehurst elementary schools.

CONTACT reporter Ryan McCarthy at 749-4780.