Suffolk, contractor in dispute over bank renovation

SUFFOLK

A Suffolk construction firm says the city backed out on a contract to renovate the Phoenix Bank Building downtown and turn it into an African American museum, but Suffolk countered on Thursday that there never was a finalized contract to begin with.

Pepperdine Corp. filed suit against Suffolk last month, charging negligence and breach of contract and asking for $175,000 in damages.

The city for years has planned to renovate the bank building at 341 E. Washington St. into a museum honoring black history. The Phoenix Bank Building, which is owned by the city's economic development authority, was the center of black commerce in Suffolk in the 1920s.

According to Pepperdine's suit, the city on March 23 accepted its renovation bid of $884,123 on the project and contracts were drawn.

But after Pepperdine's bid, the company found "numerous errors, omissions and inconsistencies in various documents" provided by the city and notified the city of the errors, according to the suit. For example, the suit said, "contract documents reference the owner of the project as 'Hampton University' rather than the city of Suffolk."

The company submitted a list of errors and comments - as city officials had requested - on May 11, the suit said.

The city and the company then exchanged numerous emails on errors and proposed revisions. The company submitted a signed contract and other documents incorporating those revisions on Sept. 7, according to the suit. City officials say they never signed the final contract.

On Sept. 21, the city notified Pepperdine it was terminating the contract, according to Pepperdine's suit.

"The city of Suffolk wrongfully terminated the contract," the suit charged. As a result, the company "incurred considerable expense" in responding to the city's request for corrections to "documents issued by the city of Suffolk."

The suit asked for compensation totaling $175,000 plus interest.

City leaders have asked that the Suffolk Circuit Court dismiss the lawsuit and order the company to pay its legal costs. A hearing on the case has not been set.

Responding to the lawsuit Thursday, the city said Pepperdine's allegations "do not demonstrate that a contract was created" and "are insufficient to state a claim for negligence."

City spokeswoman Debbie George added via email that "the city did not have an executed contract with Pepperdine Corp., and there have been no subsequent contracts" for the project.

Jeff Sheler, (757) 222-5563, jeff.sheler@pilotonline.com