The CNMI, through former Attorney General Matthew Gregory, filed the complaint for professional malpractice and breach of contract against Leo A. Daly Company.
Gregory demanded a jury trial.
Founded in 1915 by Leo A. Daly, the firm has 29 offices in the U.S. and overseas.
Some of its projects included the Pope John Paul II Cultural Center, the Lied Library, the National World War II Memorial and the Mayo Clinic cafeteria expansion.
Gregory said Leo A. Daly Company’s Texas-based office induced the CNMI to enter into a contract for the design of the dialysis project touting its abilities and experienced personnel.
“The design, which was ultimately produced by the defendant, was later determined to be defective beyond ordinarily expected and reasonably acceptable potential deficiencies. Such deficiencies included the failure to design the [Commonwealth Health Center dialysis center] to meet applicable and customarily accepted code requirements, earthquake stress requirements and other design standards ordinarily expected to exist in the quality of construction for a health center,” court papers filed by Gregory stated.
He said the CNMI government attempted to address the situation as early as 2003.
“On or about Aug. 2003, the defendant repudiated its responsibilities under the contract, indicating to the plaintiff that it would perform no remedial work to the design absent significant additional payments, notwithstanding the fact that defendant’s work was substandard and the defendant had a legal obligation to repair deficiencies,” he said.
He said Leo A. Daly reneged on its contract by failing to repair the reported defects in its design and now owes the CNMI damages because the facility’s completion and use were delayed due to its faulty design.
“In addition, the utility of the resulting facility was less than what was originally anticipated due to the deficiencies in the design, thereby depriving the commonwealth of the full use and benefit of the facility, as intended,” he said.
“As a consequence of the defendant’s actions, the plaintiff has suffered damages in an amount in excess of $10 million, to be proven more specifically at the trial of this cause,” he added.
Leo A. Daly was given 20 days to respond to the complaint.
Acting Health Secretary Pete Untalan earlier told the Legislature that the reverse osmosis water system certification of the dialysis center from the U.S. Food and Drug Administration was forged.
The cost of the project which was originally estimated at $5 million eventually reached $22 million.
