BEND, OR -- Bend City Councilors voted this week to add $2.2 million to its agreement with the law firm Stoel Rives, to defend the city against a lawsuit. In 2013, Apollo Inc. was awarded a contract to complete the city's water reclamation facility expansion project; it was the lowest bidder. The city contends Apollo performed defective work, and entered into mediation due to the alleged breach of contract. But, Apollo filed suit against Bend before that process was complete.
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Associate City Attorney Ian Leitheiser explains why Councilors need to amend the contract with the law firm, "It's based on an estimate of taking the case to and through trial or arbitration. The parties are currently in Deschutes County Circuit Court arguing about whether this case should be heard in court by a judge, which is the city's preference, or in arbitration in a closed proceeding, which is Apollo's preference. So, either way, it's going to involve increased costs and expenses, and the proposed amendment is designed to make sure that those can be paid."
The amendment passed in a 6-2 vote, Wednesday. Mayor Casey Roats voted in favor of the additional money. "The court amendment represents a 'not to exceed amount,' meaning that if the work is not ultimately necessary, the money will not be spent. So, while it is a large sum of money, and we as a Council, and as a city, intend to defend ourselves vigorously, we of course hope not to spend that money, but clearly have signaled the intention to do so, if need be." He adds, "We are faced with a potential opponent in court who actually filed litigation against us while we were still in mediation, so it is with all of that history that we enter into this; not lightly, and not because we want to, but because we have to."
Councilors expect to hear in the fall whether the case will go to trial.