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Angelos company owes $1.4M for repairs to garage

A judge in Baltimore has ordered companies related to Baltimore Orioles’ owner Peter G. Angelos to pay more than $1.4 million to Graciano Corp., a Pittsburgh-based construction company that renovated an underground parking garage just north of Angelos’ law office.

In her Jan. 28 final order in Baltimore City Circuit Court, Judge Althea M. Handy established a mechanic’s lien and ordered that the six-level garage in the 200 block of North Charles Street be sold unless the defendant companies pay or post a bond by Feb. 25.

But the lawyer representing the Angelos defendants said the property won’t be sold. The required $1.6 million bond will be posted, and the judgment will be appealed, said Thomas C. Beach III.

“Don’t stand out on Charles Street waiting for the auctioneer because you’ll get cold,” Beach, of Whiteford Taylor & Preston LLP, said Wednesday.

Graciano’s lead attorney, on the other hand, said the summary judgment orders in the case were “totally appropriate” and that the construction company is in a “strong position with regard to any appeal.”

“What’s significant here is the work; not only was it approved, it was requested by Artemis,” said Gordon S. Woodward, referring to Artemis Properties Inc., a managing agent for Angelos-related properties. “Graciano would like to be paid for it.”

Renovations

The mechanic’s lien ruling came the same day an Angelos-led group of downtown Baltimore property owners added complaints about a state-financed parking garage to their lawsuit protesting the planned redevelopment of State Center.

The State Center lawsuit, filed in December, centers on a claim that the state failed to follow its own procurement rules in hiring a developer for the project in 2005, when master developers for the 15-year-project were named. The plaintiffs raised concerns about lack of competitive bidding on the $33 million parking garage in their filing Friday.

The seeds of the mechanic’s lien litigation also were sown in 2005, when an Angelos-affiliated company purchased the 222 N. Charles St. garage for $12.6 million. The underground garage is located below a complex that includes apartment buildings, a food court and a grocery store.

In 2006, Graciano was hired by defendant 222 Holding LLC, of which Angelos and his wife and Southern Management Corp. CEO David Hillman are members, to make repairs to the garage.

The Angelos defendants and Graciano, which was founded in 1916 and has done restoration work for New York’s Rockefeller Center and the Brooklyn Academy of Music, began on good terms. Around the same time, Graciano was hired to repoint the nearby Fidelity & Deposit building, another Angelos-affiliated property.

“They did it correctly and they did it well,” Beach said of the F&D contract. “And they did it within contract and got paid.”

The garage deal started out at $2.49 million. After four change orders and two separate invoices in the spring and summer of 2008, the final cost was nearly double the original estimate.

According to defense court documents, by June 2007, Angelos had concerns about the progress and cost of the garage and switched engineers that July.

Graciano alleged that both engineering firms, as well as Artemis, knew and approved of the work it was doing throughout the project, which was finished in 2008. To date, Graciano claims it has been paid less than $3.37 million for what was more than $4.6 million worth of work.

The defendants have argued that the contract was a lump-sum contract, not to be increased except through a particular process, and that the more than $2 million in additional work was not authorized. The defense counterclaimed for the $800,000 it believes it overpaid and sought $2.4 million in punitive damages.

“Graciano was pretty confident that Mr. Angelos was going to be able to come up with whatever they spent,” Beach said. “That pissed him off, to put it bluntly. It would piss me off.”

Woodward said all the extra work was authorized through the proper channels and that Artemis had “no complaints” about its quality.

Graciano sued in February 2009. On Nov. 1, 2010, Judge John A. Howard, Handy’s colleague on the city circuit bench, held a hearing on summary judgment motions. He found in favor of Graciano both on its claim and on the Angelos defendants’ counterclaim on Jan. 18, the day before trial was to begin.

Howard granted the mechanic’s lien for nearly $1.25 million, and on Friday, Handy added pre-judgment interest of $178,000 and the property sale details.

Beach said he filed a motion for reconsideration of Howard’s order on Friday, the first step toward what he hopes will be a new trial date.

“As I told Gordon Woodward, it ain’t over until it’s over,” Beach said.