Denver Auditor Dennis Gallagher is demanding that United Parcel Service pay more than $275,000 over what his office admits is a clerical error in a contract.
The dispute has Mayor John Hickenlooper’s administration fuming. City officials characterized Gallagher’s move as “gotcha” contract enforcement that could chill relationships between the city and businesses.
The auditor’s office, however, isn’t budging.
“A contract is a contract,” said auditor spokesman Denis Bercke feldt. “UPS is a giant corporation with hundreds of thousands of dollars in lawyers and all of them can’t get (the contract) straight?”
At issue is a 2000 Denver International Airport airfield leasing contract with UPS Co., chartered in Delaware. Accidently, UPS Inc., an affiliate company chartered in Ohio, was the signatory. The error was found in a 2003 audit. In response to the audit last year, airport officials sent Gallagher a letter saying that UPS paid its bills and had been a good tenant, and the mistake would be fixed.
In May, the city filed an amendment to the contract, fixing the error. It was signed by the auditor’s office.
Even so, Gallagher’s office wants UPS to pay $275,381 for underpaying landing fees because the wrong company signed the contract. Non-signatory companies are charged a higher landing fee rate.
“We don’t want businesses to fear that a clerical mistake might result in them being embroiled in litigation,” said City Attorney Cole Finegan. “This administration is interested in cooperating with businesses and trying to be sure everyone is treated fairly. We don’t want to play ‘gotcha’ over a clerical mistake.”
Gallagher’s office said that fair means that everyone plays by the same rules.
“What is right is right, and I would be derelict in my duty if I did not exercise my obligations as auditor in an impartial and fact-driven manner, not susceptible to the whims of the moment,” Gallagher wrote in a press release.
Staff writer Karen Crummy can be reached at 303-820-1594 or kcrummy@denverpost.com.
