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Construction cos. trade similar accusations

Rawson Contractors Inc. is claiming Michels Corp. failed to pay up after a 2012 sewer project.

Michels is claiming the circumstances were reversed four years earlier when Rawson failed to pay after a similar sewer project.

Those echoing allegations now are at the heart of a breach of contract lawsuit between Pewaukee-based Rawson and Brownsville-based Michels.

Rawson sued Michels in September, claiming the company failed to pay the full amount under a 2012 subcontract for city of Milwaukee sewer work. Michels won a $7,993,374 contract for that project and hired Rawson as a subcontractor to repair and move water mains, combine sewers, and to line manholes.

Rawson did that work beneath North 26th Street between West St. Paul Avenue and West McKinley Boulevard, according to court documents, and the contractor claims it is owed $60,259.65.

But in an answer and counterclaim filed Dec. 16, Michels levied nearly the same charges against Rawson.

In 2008, according to court documents, Rawson was the prime contractor on a Milwaukee sewer and manhole project. The company hired Michels as a subcontractor and, Michels claims, still owes money for that work.

Michels lined sewer mains and manholes beneath North 25th, North 32nd and North Edison streets and beneath West Fond du Lac Avenue, according to court documents, and Rawson agreed to pay on a time-and-materials basis if Michels had to do any “heavy cleaning.” Michels had to remove bricks, debris and heavy mineral deposits before it could finish the project, according to court documents, and was therefore entitled to additional payment, though that amount was not specified in the counterclaim.

David Stegeman, Michels’s chief legal officer, said the company does not comment on ongoing litigation.

Ken Servi, Rawson’s president, could not be immediately reached for comment. Edward Hannan, an attorney with Waukesha-based Hannan Legal LLC who represents Rawson, said Tuesday he was unable to comment.

According to court documents, because Rawson never paid for the heavy cleaning, Michels offset a portion of what it was owed for the 2008 project with money Michels would have paid Rawson for the 2012 project.

Michels and Rawson began settlement talks in October, according to a letter attributed to Hannan and addressed to Milwaukee County Circuit Judge Michael Guolee, and the case was put on hold until December to allow those talks to continue.

However, the December deadline brought Michels’s counterclaim rather than a settlement. Rawson has not filed a response to that counterclaim, and the case is set for a scheduling conference Jan. 29.

Despite offsetting some of the money from the 2012 project, Michels claims Rawson still owes an unspecified amount for the 2008 project, according to court documents. In its counterclaim, Michels asked that Guolee dismiss Rawson’s claim and award Michels damages for the amount the Pewaukee contractor still owes.

About Beth Kevit, beth.kevit@wislawjournal.com

Beth Kevit is the Milwaukee city beat reporter and also covers real estate. She can be reached at beth.kevit@wislawjournal.com or 414-225-1820.

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