The city of Greenwood has accepted a $775,000 settlement from three companies the city sued following the collapse in 2018 of a manhole close to the wastewater treatment plant.
The City Council had voted 6-0 during a special called meeting Friday to accept the settlement at the recommendation of Glenn F. Beckham, a Greenwood attorney who represented the city. Ward 6’s David Jordan was not present.
On April 26, 2019, the city filed a complaint in Leflore County Circuit Court against the companies — Max Foote Construction Co. LLC, Neel-Schaffer Inc. and Forterra Pipe and Precast LLC — asking for a jury trial and unspecified damages.
The city contracted with Max Foote in July 2012 to construct a new wastewater treatment plant on Ione Street for $34 million.
The city also contracted with Neel-Schaffer to provide engineering services in connection with the construction of the plant, according to the complaint.
A manhole was installed at the entrance to the new plant.
Forterra Pipe was the manufacturer of the manhole that later failed; Max Foote, under the supervision of Neel-Schaffer, installed the manhole and the two pipes.
Three years after the completion of the wastewater treatment plant, the manhole failed, causing a sinkhole to form around it in April 2018.
In its complaint, the city charged that Max Foote Construction breached its contract by installing a faulty manhole and that Neel-Schaffer failed to properly supervise the construction.
Beckham told the City Council that Max Foote Construction had initially tried to fix the faulty manhole to no avail. The city ended up hiring Malouf Construction to excavate the old manhole and install a new, cast-in manhole — different from the pre-cast manhole Forterra manufactured — for approximately $1.1 million.
Prior to filing suit, Beckham said, Max Foote Construction and Neel-Schaffer were contacted.
“They didn’t offer us a penny. So at that point in time we filed a lawsuit,” he said, explaining that Forterra was included since it had manufactured the manhole.
“We thought they had some responsibility, too,” Beckham said.
The settlement figure was determined Tuesday during a mediation between the city and the defendants.
Though Beckham said the city would most likely do well in court if the case proceeded to trial, he urged council members to vote to accept the settlement for several reasons.
One reason, he said, is that litigation can be “dangerous and hazardous” because new facts can come up that could challenge the city’s argument.
Additionally, if the case continued, the city would end up paying more money in legal fees, Beckham explained.
Finally, even if the city won the case, Beckham said that it would most likely be appealed by one of the defendants and, therefore, prolong the case.
The city will get its settlement money within 30 days: $375,000 from Neel-Schaffer, $300,000 from Max Foote Construction and $100,000 from Forterra, Beckham said.
Accepting the settlement would release the defendants from any problems with the manhole and its associated equipment but it would not prevent the city from seeking further legal action should problems with the wastewater treatment plant arise in the future.
“We’re not giving up something we don’t know about,” Beckham said. “Stuff that may come up in the future. They’re not being released from that.”
• Contact Gerard Edic at 581-7239 or gedic@gwcommonwealth.com.
