River Falls couple sues insurance companyMichael and Tammy Nagel, W8721 77th Ave., River Falls, filed suit against Federated Mutual Insurance Company.
Michael and Tammy Nagel, W8721 77th Ave., River Falls, filed suit against Federated Mutual Insurance Company.
In February, Steiner Plumbing, Electric & Heating, N8230 945th Ave., River Falls, filed a lawsuit against the Nagels, claiming they owe $164,386 for work Steiner did on the couple’s new house. Steiner had also filed a construction lien last June.
The Nagels filed the most recent case to include Federated. This case says Steiner’s commercial general liability insurance and errors and omissions liability insurance with Federated should provide coverage.
In their claim, the Nagels allege negligent design and negligent construction. They say their damages are in excess of $500,000 and ask this lawsuit be consolidated with the earlier suit filed by Steiner.
According to the Nagels’ complaint, in spring 2010, they interviewed a number of contractors who bid on a project, which included designing and installing plumbing, electrical and geothermal heating and cooling systems for a new home and pole shed/office building. The home would be over 10,000 sq. ft. and would include an indoor swimming pool. The office would have about 1,000 sq. ft. of finished space, including an office, lavatory, kitchen and a heated garage. The project would have multiple heating and air conditioning systems.
According to the Nagels, they hired Steiner and were told they would have a 10-year warranty. The total contract price was $346,072. They paid half ($173,036) when the project was “roughed in.”
“From the very beginning, (Steiner) failed to properly staff the project,” according to the Nagels’ complaint. They say the work was not completed in time for an Oct. 10, 2010, closing.
The complaint says Michael Nagel met with Paul Steiner numerous times to express concern and to tell him his failure to staff the project and complete the work was delaying the entire project.
On Oct. 20, Nagel and Steiner signed an addendum saying the project would be finished by Nov. 5, giving Nagel the right to dismiss Steiner from the project if it wasn’t done by then and allowing the Nagels to deduct $500 a day from the contract amount if the work wasn’t finished on time.
“In addition to the project being unfinished, virtually none of the plumbing, electrical, HVAC and geothermal hearing and cooling systems designed and installed by (Steiner) worked properly,” says the complaint. “Indeed, most of the systems were not working at all.”
In January 2011, the Nagels terminated Steiner and said they would hire other contractors to finish the project.
The Nagels hired an engineering firm to inspect all the systems and document errors, and then got bids to correct the deficiencies. According to the complaint, those bids indicate it will cost over $500,000 to correct the problems.
The counterclaim alleges breach of contract, negligent design and construction, and slander of title for filing a construction lien. The Nagels are asking for over $500,000 in damages plus $1,000 in punitive damages on the slander of title allegation.