Res 42-73 RESOLUTION NO. 42-73
A RESOLUTION OF ~YEE Ci%~Z COUNCIL OF DELRAY BEACH, FLORIDA,
AUTHORIZING APPROVAL 0F A SETTLEMBNT AND COMPROMISE
AGREENEENT WITH JlzM R. KERN~ AND THE ST. PAUL FIRE AND M~RtNE
INSb-RANCE COMPANY AND A REI,EASE AID COVENANT NOT TO SUE ST.
PAUiL FiRE AN~ MARIN~E INSURANCE COMPANY
NtI~REAS, on May 24', 1973 a Judgment was rendered in the Fifteenth
Judicial Circuit Court in and for Palm Beach Cova~ty, Florida on behalf
of Jim R. Kern against Benjamin F. Baldwin, the City of Delray Beach, ~
Florida (hereinafter referred to as "City"),_ and the St. Paul Fire and
Marine Insurance Company in the amount of $600,000.00; and
WI-~EREAS, the City's applicable liability insurance coverage
the St. Paul Fire and Marine Insurance Company amounts to $250,000.00;
and
Ni-~REAS, Officer Baldwin's applicable liability insurance coverage
amounts to $25,000.00; and
Wi-~REAS, the City has asserted a claim against the St. Paul
and Marine Insurance Company and said insurance company has agreed to
settle the City's claim in the amount of $150,000.00 as set forth in the
attached Release and Covenant Not to Sue; and
WHE~S, Jim R. Kern has agreed to settle and compromise his
aforesaid Judgment for $525,000.00 as set forth in the attached A-greement
between Jim R. Kern, the City of Delray Beach, Florida and the St. Paul
Fire and Marine Insurance Company; and
WtZEREAS, Robert D. Chapin, Special Counsel for the City of Delray
Beach, Florida recommends the City enter into said Agreement and said
Release and Covenant Not to sue.
NOW TItEREFORE, BE IT ~SOLVED BY THE CITY COUNCIL OF TrEE CITY 0F
DELRAY BEACt[, FLORIDA:
That pursuant to Article II, Section 5, Article III, Section 25
and Article Il, Section 12 of the Charter of the City of Delray Beach,
Florida, Vice-Mayor Grace S. Krivos, in the absence of both the Mayor
and the City Manager from the City, and City Clerk Hallie E. Yates, are
hereby authorized and directed to execute .and attest, respectively, the
Agreement between Jim R. Kern, the City of Detray Beach, Florida and the
SS. Paul Fire and Marine Insurance Company on the same terms set fort~
in said Agreement attached hereto and made a part hereof, and the Re lease
and Covenant Not to Sue with the St. Paul Fire and Marine Insurance Company
o~ the same terms set forth in said Release and Covenant Not to Sue attached
hereto and made a part hereof.
ZN WITNESS WHEREOP, the City Council of Delray Beach adopted
Resolution No. 42-73 in regular session on this 24th day of September,
1973.
or
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RELEASE ArID COVEiqAi,~T NOT TO SUE
A verdict and subsequent judgment in'favor of Jim R. Kern
having been returned against the City of Delray Beach, Florida,
Benjamin F. Baldwin and St. Paul Fire and Marine Insur.lnce Company
in Case No. 71 C 2460-Smith in the Circuit Court of the Fifteenth
Judicial Circuit, in and for Palm Beach County, Florida in the
amount of Six Hundred Thousand Dollars ($600,000.00).; and
WHEREAS the limit of liability of St. Paul Fire and Marine
Insurance Company is in the sum of Two Hundred Fifty Thousand
Dollars ($250,000.00), which is its applicable policy limits; and
WHEREAS the City has a contingent claim for breach of
contract, negligence and bad faith against St. Paul in its
alleged failure to properly defend the City and further its
failure to settle the above entitled action within the applicable
limits of its insurance policy during the pendency of this suit
and before judgment was rendered; and
WHEREAS the parties to this agreement recognize the uncertain-
ties of litigation and exposure of each of them to perhaps greater
money liability in the event of further litigation, it is
therefore agreed:
In consideration of the payment of Four Hundred Thousand
Dollars ($400,000.00) [One Hundred Fifty Thousand Dollars over
and above its applicable policy limits] by St. Paul Fire and
Marine Insurance Company to Jim R. Kern, the City of Delray
Beach, Florida hereby covenants and agrees with St. Paul Fire
and Marine Insurance Company, its successors or assigns, that
the City of Delray Beach, Florida will never institute any suit
or action at law or otherwise against St. Paul, nor institute,
prosecute or in any way aid in the prosecution of any claim,
d~nand, action or cause of action for damages, costs, loss,
expense or compensation, for or on account of any damage, loss
or injury, known or unknown, as a result of the judgment rendered
in favor of Jim R. Kern and against the City of Delray Beach,
Florida in the amount of $600,000.00. It is understood that this
agreement forever prevents and enjoins the City from prosecuting
or assisting in the prosecution of any claim against S~t. Paul
Fire and Marine Insurance Company, its agents, servants,
independent contractors, attorneys or employees for its alleged
negligence or bad faith in defending the City in the action by
Jim R. Kern described above. Nor may it bring any action,
specifically but not limited to, the failure of St. Paul Fire
and Marine Insurance Company to compromise or settle this claim
of Jim R. Kern during the pending litigation by Jim R. Kern
against the City of Delray Beach, Florida and St. Paul Fire and
Marine Insurance Company before final judgment was rendered
against the City of Delray Beach, Florida and St. Paul Fire and
Marine Insurance Company.
As part of this agreement, the City of Delray BeaCh, Florida
has agreed to pay Jim R. Kern the sum of One Hundred Thousand
Dollars ($100,000.00), which agreement is separate and apart from
this instrument and in no way is binding upon St. Paul Fire and
Marine insurance Company but is exclusively a matter between Jim
R. Kern and the City of Delray Beach, Florida.
By payment of the Four Hundred Thousand Dollars ($400,000.00)
by St. Paul Fire and Marine Insurance Company, all contingent
claims of the City of Delray Beach, Florida against St. Paul
Fire and Marine Insurance Company are extinguished forever.
It is understood and agreed that payment by St. Paul Fire
and Marine Insurance Company is the compromise of a doubtful and
disputed claim, and is not to be construed as an admission of
liability on the part of St. Paul Fire and Marine Insurance
Company by which liability is expressly'denied.
The City of Delray Beach, Florida agrees that this instrument
will be executed pursuant to the Ordinances of the City of Delray
Beach, Florida and the laws of the State of Florida and this
instrument shall be binding upon the City and all of its successive
administrations.
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WHEREFORE, in and for the consideration previously enumerated,
the City of Delray Beach, Florida, has remised, released and
forever discharged St. Paul Fire and Marine Insurance Company
from all claims of every kind, nature and character whatsoever
against it arising out of the personal injury litigation in
behalf of Jim R. Kern, previously described.
Dated: this 24th day of September, 1973.
Witness: CITY.OF DELRAY BEACH
~~ ......... I~s ~ Vice-Mayor ?:
ATTEST: ....
.......... C'~Yy c're ro~ ......
I, ROBERT D. CHAPIN, of Gezelschap & Chapin, 1045 Building,
1045 E. Atlantic Avenue, Delray Beach, Florida, state that I
am the attorney ~r the City of Delray Beach, Florida, Releaser
herein; that I have explained to the City of Delray Beach, Florida
all of the terms of this Release, and that the City of Delray
Beach, Florida has represented to me that it fully understands
all those terms and their significance. The City of Delray Beach,
Florida has signed this Release and Covenant Not to Sue upon my
advice.
Dated: the ~~day of September, 1973.
'R~BER~'D. CHAPIN- /- -
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AGREEMENT
IT IS HEREBY AGREED bY and between JIM R. KERN, the
CITY OF DELRAY BEACH, and ST. PAUL FIRE AND MARINE INSURANCE
COMPANY, as follows:
1. That 'a judgment was duly entered against the City
of Delray Beach,i St. Paul Fire and Marine Insurance Company,
and Benjamin F. Baldwin, in a total amount of $600,000.'00, on
May 24, 1973.'
2. That the Parties ~hereto agree that the Court has
taxed costs in the amount of $1,680.'42.1
3.' That the .judgment has accrued interest at $98.63
per day from the idate of May 24, 1973.
~ 4.' That ~the Parties hereto agree .that this matter has
been compromised and settled for $525,000'..00 'by the following
agreements:
(a) st. Paut Fire and Marine Insurance Company
agrees to pay $400','.000.'~00 on the said judgment within
not more than ten (10). days of the 'signing of these
presents.
(b)i. The parties agree that Lumbermens Mutual
Insurance Company, on behalf of Benjamin F. Baldwin,
has ~paid $25,000.'~00 into the 'registry of the Court .
which ~wiill be withdrawa from the registry of the Court
in favor of Jim R. Kern.
(C) The City of Delray Beach agrees to pay
$40,000.00 .on or before 'thei25th 'day of September~
1973 on the said judgment, and to pay $30,000..00 on
or before the first day of September for two successive
years,~ namely 1974 and 1975, .until a total of $100,000.00
has been paid.
(d) Plaintiff, Jim R. Kern, agrees to give St. Paul
Fire and Marine Insarance Company a satisfaction of the
judgment against the said corporation in the amount of
$250,'000.00.~.
(e)i Plaintiff, Jim R. Kern, agrees to waive
an~ claim for interest and costs taxed on the said
judgment against the City of Delray Beach provided
that the City of Delray Beach shall make the payments
hereinbefore described; in the eVent the City of
Delray Beach shOuld fail or refuse to make the
payments described above, then in that event only
the plaintiff, Jim R. Kern, shall-recover interest
from the City of Delray Beach 'at six per cent (6%)
on the unpaid balance of the settlement from the
date of the signing of these presents and continuing
until said unpaid balance lis 'Paid; and, further, that
it is agreed that the City of Delray Beach shall pay
costs and reasonable attorneys'- fees incurred in the
event it is necessary to colleCt any unpaid balance.
(f) Plaintiff, Jim R. Kern,~ covenants that he
shall never proseCute or bring any claim whatsoever
9gainst St. Paul Fire and Marine insurance Company
for its ~all~ged n~gligence or bad ~faith in the defense
of, prosecution of, or failure to setltle his claim
against the City of Delray Beach,' Florida. This
covenant is applicable not ~only to St.~ Paul Fire and
Marine Insurance Company but its agents, servants,
employees,' attorneys,~ and indePendenti~contractors.·
.(g) Upon completion of the payments described
abOve, the plaintiff, Jim R. Kern,~ agrees to give a
full and final satisfaction of .judgment to the City
of Delray Beach for any claims 'arising pursuant to
the judgment described hereinabove.i
(h) The City of Delray Beach, Florida, agrees
that this instrument will be executed pursuant to
the Ordinances of the City of Delray Beach, Florida
and the laws of the State of Florida, and this
instrument shall be binding upon the City and all
of its successive administrations.
WITNESS our hands and seals, this ~~ day of
'sep~emb. er' ~ .., 1973, Palm Beach County, Florida.
· ~ __~.L (SEAL)
As to Jim R. Kern
CIT~ OF DELRAY BEACH, FLORIDA (SEAL)
...../~9'~z. ~.-.%~/vL~'c' ...~/~'. ~_~./__~1 . ByGrace S. Krivos, Vice-~{avor. _
- ' f~L/~'/ ST. PAUL FIi~E ~D ~RINE
/~.~.t i} INSURANCE CO~,~P~Y (SEAL)
AS to St. Paul Fire and
Marine Insurance Company
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