Sami Miro, president of S.A. Miro Inc. of Denver, has an $800,000 subcontract with Rapistan Demag Corp., the Michigan company building the $50 million "back-up" baggage system that Mayor Wellington Webb hopes will have DIA open by February 28. The city told Rapistan to hire Miro as a consultant before it signed the contract in August.
But Miro already was one of several defendants in a lawsuit brought by the city in February against C.W. Fentress J.H. Bradburn and Associates, the architects who conceived DIA's landmark, $432 million terminal. The suit alleges that Miro, Fentress and others involved in the design of the building "breached their duty of reasonable care and skill" and caused major cost overruns because of "defective work."
"We do the most ridiculous things," says city councilman Ted Hackworth when asked about the suit. "If we determined the man [Miro] didn't do a good job, I don't know why we'd hire him again."
That's not the only strange twist to the Fentress litigation. Court papers also show that L. Tyrone Holt, the former DIA bond attorney who was suspended from practice in 1992 for income-tax evasion and cocaine abuse, now is helping represent Fentress against the city in the case.
Hackworth says Holt's involvement smacks of conflict of interest. "I sure have to wonder if there is a potential conflict," he says. "He's got inside information."
The city sued Fentress in February, charging it had been "materially damaged" by flaws and other problems in the terminal plans. Also named in the suit were Miro and other engineers hired as subcontractors to Fentress, all of whom vouched for the architectural soundness of the building design.
The city blames Fentress and the engineers for numerous mistakes that it says added at least $30 million to the cost of erecting the terminal.
Poor design coordination, for instance, forced the city to build new structural supports and to reroute ducts in the building, according to the city's complaint. The support system for the terminal's granite flooring proved inadequate and had to be partially replaced. The terminal's electrical grounding system failed, requiring a complete redesign.
Despite all these problems, the city picked Miro in August to help Rapistan Demag build the alternative baggage system. Webb ordered the construction of the replacement system this summer because of ongoing problems with DIA's primary, fully automated bag system that have delayed DIA's opening four times so far.
City officials defend the decision to rehire Miro. Because of his intimate knowledge of the terminal structure, they say, he can help the city get the back-up system installed quickly and efficiently. That's a prime consideration, since it costs Denver more than $1 million for every day DIA remains closed.
"You go to people who are familiar with the calculations and designs of the property," says Amy Lingg, spokeswoman for the Department of Public Works. "It saves time and money."
"It seemed to be the prudent thing to do--considering economics and schedules," agrees Assistant City Attorney Steve Niparko. "It was a dollar/time issue."
Miro declines comment, saying he can't talk because of the lawsuit.
In the suit, the city seeks unspecified damages from the defendants. Fentress, Miro and the others, meanwhile, have filed a countersuit against the city, claiming it has reneged on a promise to pay litigation costs and damages arising from malpractice claims related to their DIA work.
In May 1991, the defendants claim, the city formed its own insurance pool to protect architects, engineers and other DIA design professionals from lawsuits. The city charged contractors the premiums to pay for the so-called "Owner Controlled Insurance Program," and many ended up dropping private, DIA-related liability insurance they already had.
It wasn't until after the city sued them, Fentress and the other defendants say in their countersuit, that they learned the city's program left them uncovered for the first $1 million on every claim. The normal deductible for such policies is $25,000, the defendants say. As a result, Fentress and the others say, they will be forced to pay the first $1 million in litigation costs themselves, something they can't afford.
"It's mind-boggling," says one attorney representing a defendant in the case.
Darrell Waas, the lead attorney for the Fentress firm, declines comment on the suit. But he defends the firm's decision to bring in Tyrone Holt as co-counsel, denying that Holt has a conflict of interest in the case.
Waas says Holt has represented Fentress in the past and has formidable litigation skills. "He's an outstanding lawyer," Waas says.
Holt, who worked with Webb on his 1991 campaign and who is one of the mayor's close friends, was suspended from practice for a year by the Colorado Supreme Court in 1992 after admitting that he had abused cocaine and had failed to pay federal income taxes for several years. At the time of his suspension, Holt's firm had served as "underwriter's counsel" on three DIA bond issues. Webb severed the city's ties with Holt when news of his suspension became public.
Niparko, the assistant city attorney, declined comment on Holt's participation in the lawsuit. Holt, whose license to practice was reinstated in April, could not be reached.
