The town will receive $6.6 million from the bonding company that insured the contractor hired to rebuild the seawall at Crescent Beach in the Gunrock area of town.

Town Manager Jennifer Constable released a statement last week announcing the resolution of the suit over the contractor’s performance. RC&D, Inc. and the town had clashed over the seawall repair and revetment work, which was supposed to be completed in 2017.

“In exchange for dismissing the lawsuit, the town received $6,658,900 from Allied World Insurance Company, which had issued a $5,617,800 performance bond ensuring RC&D’s successful completion of the project,” according to the town’s statement. “This settlement – which exceeded the amount of Allied World’s bond by more than $1 million – is uncommon in construction bond litigation.”

The project called for repairs to about 1,750 feet of seawall and revetment and raising the height of the wall by two-and-a-half feet. The contractor also was to add more than 1,500 feet of revetment, or rock in front of the wall, to absorb energy from wave action.

After falling behind schedule, RC&D stopped work on the project and eventually went out of business. Some additional repairs were done by contractors hired by the town, but more work is needed to finish the project as originally envisioned.

“The recent settlement with the bonding company will allow the town to end this longstanding legal dispute and move forward with the outstanding repair work after securing the necessary state and federal approvals,” according to the town’s press release.

“This is a hard-fought win for the town. The settlement amount exceeds the estimated cost of completing the work, and it far exceeds the bond amount,” Constable said in the statement. “Furthermore, the settlement allows us to avoid the additional time, effort, expense, and uncertainty of bringing our case all the way to trial and into potential appeals by the insurance company, which argued, among other things, that its liability was capped at $5,617,800 amount of its bond. This result vindicates the town’s efforts and finally allows it move ahead with the completion of this important project.”