Lumber company sues over cancelled boardwalk contract

February 25, 2008 12:22:40 PM PST
A Baltimore lumber company whose delays in providing tropical rainforest wood for a southern New Jersey boardwalk led to cancellation of the contract is suing Ocean City for $1.2 million. The lumber company notes that even though the city says it won't pay for the wood, it already has installed some of it on the boardwalk.

Louis J. Grasmick Lumber filed suit in U.S. District Court earlier this month alleging that Ocean City had illegally breached the contract to buy Brazilian ipe, wood cut from tropical rainforests that is prized for boardwalks because it is more durable and weather-resistant.

But environmentalists protested, noting that Ocean City had pledged a decade earlier never to use tropical hardwoods on its boardwalk again, and pressured the city into canceling the contract last month.

"This was all preventable," said Rhonda VanWingerden, one of the leaders of Friends of the Rainforest, a local group opposed to the use of rainforest wood on the boardwalk. "From the start of this entire process, every step of the way has been mishandled."

In numerous statements to the media, in press releases and at public meetings, city officials including Mayor Sal Perillo said canceling the contract would expose the city to a lawsuit.

"You could see this (lawsuit) coming for a long time," said Joseph Kernen, an attorney for Grasmick.

"I've never seen an instance where it was so obvious that the decision wasn't made on merit. It's their capitulation to political pressure," Kernen said. "We've already paid significant six-figure amount to suppliers to procure this wood, custom-milled and cut to Ocean City's specifications."

The Ocean City boardwalk wood controversy has drawn worldwide interest from environmentalists, who flooded the mayor's office with 50,000 e-mails. Yet the city administration forged ahead with the plan, even after the City Council voted - twice - to urge it to scrap the contract.

When it did finally terminate the contract, the city cited lengthy delays in delivery, and uncertainty as to when the majority of the wood would arrive in Ocean City.

City Solicitor Jerry Corcoran said Ocean City is preparing a countersuit against Grasmick, adding there have been no discussions about a settlement.

Grasmick was to have delivered the wood by last Dec. 15, but small shipments didn't start showing up until mid-January.

The company claims delays were due to factors beyond its control, including near-record low water levels in the Amazon that made it difficult to float logs to mills, currency fluctuations that resulted in supplier shipping delays, and an accident in which one of the company's trucks overturned and was damaged.

The contract contains a clause stating that it may not be terminated for delays that "are out of the practicable control of Louis J. Grasmick Lumber Company."

The city, which ripped open a block-long section of its boardwalk in December - thinking the arrival of the wood was imminent - said it has to be sure the walkway is made whole again before Easter, the traditional start of the boardwalk business season.

It's now using a mixture of some of the ipe Grasmick sent it, along with yellow pine - a domestic wood prone to splintering that prompted the council to seek tropical hardwood in the first place.

That work was continuing on Monday.