HomeMy WebLinkAbout2007 09 10 Regular 602 David & Shelli Smith and Michael & Lorraine Camarano Sewer System Back-up
COMMISSION AGENDA
September 10, 2007
Regular Meeting
Consent
Informational
Public Hearin
Re ular X
MGR~EPT.A1A
Authorization ·
ITEM 602
REQUEST: City Manager requesting the City Commission to consider settlements with David
& Shelli Smith and Michael & Lorraine Camarano resulting from sewer system
back-ups during Hurricane Charley and approval a supplemental appropriation
from Utility Fund Reserves for funding of these settlements.
PURPOSE: This agenda item is needed to for the City Commission to consider settlements with
David & Shelli Smith and Michael & Lorraine Camarano, the final two claimants against
the City, resulting from sewer system back-ups during Hurricane Charley and approve a
supplemental appropriation from Utility Fund Reserves for funding of these settlements.
CONSIDERATIONS:
1. On December 14, 2005 the City Commission approved settlement with seven homeowners as a
result of sewer system back-ups during Hurricane Charley. Terms of the settlement included:
1. 10% of approved losses, plus
2. $2,500, plus
3. A pro rata share of a pool of $17,500 (Pool derived as follows: $2,500 per homeowner x
7 homeowners = $17,500). Homeowner's pro rata share based on the proportion of the
individual homeowner's approved losses to the whole.
On recommendation from counsel and the City's insurance company (Florida League of Cities),
three remaining cases (Smith, Camarano & Walters) were not settled at that time as these
parties had pending claims with their respective insurance companies. The aforementioned
December 14, 2005 approved motion specified that the settlement at that time was for the seven
claimants only.
II. On February 27, 2006 the City Commission approved settlement with Walters, as agreed upon
by Mr. Walters, as follows:
1. 10% oflosses per private carrier State Farm = $3,919.20, plus
2. $2,500.
Total Settlement for Walters = $6,419.20
As required, Mr. Walters provided the Florida League of Cities with a statement from his
insurance company that they were not pursuing any subrogation claim against the City.
III. Mr. Smith and Mr. Camarano are requesting settlement terms commensurate with those
afforded the original seven claimants as dictated per the December 14 Commission action.
However, the City and Mr. Smith & Mr. Camarano do not agree with the method in which to
arrive at a settlement amount that is commensurate with the original seven claimants. At issue
is the calculation of the "Proportional Share."
CITY POSITION
In the City's opinion, settlement for Smith and Camarano, commensurate with the Commission
action of December 14, 2006, would be calculated as follows:
Smith
Approved Losses per Claimant's
Insurance Company
$258,784.40
10% of Approved Losses
Base Amount
Proportional Share
Total
25,878.44
2,500.00
2.786.49
$31,164.93
Camarano
Approved Losses per Claimant's
Insurance Company
$205,570.54
10% of Approved Losses
Base Amount
Proportional Share
Total
20,557.05
2,500.00
2.213.51
$25,270.56
Total Settlement = $56,435.49
All offers are contingent upon:
1. Commission approval of settlement,
2. Claimant's execution of a full release within 15 days after receipt of this settlement
agreement, and
3. Each claimant providing the City with a statement from his insurance company that they
will not pursue any subrogation claim against the City. This documentation has been
provided to the City by both Smith and Camarano.
CLAIMANT POSITION
In Mr. Smith and Mr. Camarano's opinion, settlement for Smith and Camarano, commensurate
with the Commission action of December 14,2006, would be calculated as follows (the
difference relates specifically to the calculation of the "proportional share."):
Additionally, Mr. Smith is requesting 100% reimbursement for attorney's fees he has incurred as
a result if this claim.
Smith
Approved Losses per Claimant's
Insurance Company
$258,784.40
10% of Approved Losses
Base Amount
Proportional Share
Attorney Bills *
Total
25,878.44
2,500.00
13,948.48
1,365.00
$43,691.92
Camarano
Approved Losses per Claimant's
Insurance Company
$205,570.54
10% of Approved Losses
Base Amount
Proportional Share
Total
20,557.05
2,500.00
11.080.25
$34,137.30
Total Settlement = $77,829.22
* Includes $500 estimated cost for Smith's attorney to review settlement agreement (not yet
expended).
SUMMARY TABLE
City Claimant
Position Position Delta
Smith:
10% of Approved Losses $ 25,878.44 $ 25,878.44 0
Base Amount 2,500.00 2,500.00 0
Proportional Share 2,786.49 13,948.48 $ 11,161.99
Attorney Fees 0.00 1,365.00 1,365.00
Total 31,164.93 43,691.92 12,526.99
Camarano:
10% of Approved Losses $ 20,557.05 $ 20,557.05 0
Base Amount 2,500.00 2,500.00 0
Proportional Share 2213.51 11 ,080.25 $ 8,866.74
Total 25,270.56 34,137.30 8,866.74
Total $ 56,435.49 $ 77,829.22 $ 21,393.73
City Position vs. Claimant Position Delta = $21,393.73.
FUNDING:
Funding will be via payment by the Florida League of Cities and a supplemental appropriation
from Utility Fund Reserves as follows:
10% of Approved losses:
Base amount & Proportional Share:
Total
City
Position
$46,435.49
10,000.00
$56,435.49
Claimant
Position
$46,435.49
30,028.73
76,464.22
(FLC to pay)
(City to pay)
RECOMMENDATION:
The City Manager recommends the Commission choose one of the following three options,
exclusive of attorney fees:
OPTION 1
1. Approval final settlement with David & Shelli Smith and Michael & Lorraine Camarano
resulting from sewer system back-ups during Hurricane Charley in the amounts of
$31,164.93 and $25,270.56, respectively, contingent upon execution of a full release
within 15 days after their receipt of the settlement agreement.
2. Approve a supplemental appropriation from Utility Fund Reserves in the amount of the
City'portion of$10,000.
OPTION 2
1. Approval final settlement with David & Shelli Smith and Michael & Lorraine Camarano
resulting from sewer system back-ups during Hurricane Charley in the amounts of
$42,326.92 and $34,137.30, respectively, contingent upon execution of a full release
within 15 days after their receipt of the settlement agreement.
2. Approve a supplemental appropriation from Utility Fund Reserves in the amount of the
City portion of$30,028.73.
OPTION 3
1. Other action as deemed appropriate.
ATTACHMENTS:
COMMISSION ACTION: