Donald DeCleene and Doris DeCleene - Page 9

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          letter of credit in the amount of $380,000 in favor of the title            
          company, which was delegated the task of making progress payments           
          to the contractor under the construction contract; the bank                 
          issued its irrevocable standby credit in favor of the title                 
          company in that amount.                                                     
               On September 24, 1993, Landmark Building Systems Ltd.                  
          (Landmark) entered into a lump sum construction contract in the             
          amount of $375,688 (subject to certain adjustments) with WLC to             
          construct the building on the Lawrence Drive property.  The                 
          contract named petitioner, Mike DeCleene (petitioners’ son, who             
          works in the family business), and/or a representative of Excel             
          Engineering, as owner's representative.  As owner’s                         
          representative, petitioner and Mike DeCleene had general                    
          authority, including the right to approve changes in design or              
          construction, to inspect and approve workmanship and materials,             
          to visit the construction site, and to determine compliance with            
          the contract.                                                               
               Although the standby letter of credit and the construction             
          contract do not expressly so state, progress payments to the                
          contractor were to be made only with the approval of petitioner             
          or Michael DeCleene as owner’s representative.  Excel Engineering           
          played a role in the design of the building, but lacked actual              
          authority to sign off as owner’s representative.                            

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Last modified: May 25, 2011