A lawsuit filed by AvalonBay against the town of Princeton has been settled with the municipality agreeing to pay the developer $50,000. Princeton Council passed a resolution at its meeting last week to end the dispute, which was over charges to the escrow account created by AvalonBay during construction of the rental complex on Witherspoon Street where Princeton Hospital once stood.

The municipality had used the funds to pay the Whitman Environmental and Engineering firm, which was overseeing the project. In the lawsuit filed last May, AvalonBay claimed that the work done by the company was not actual engineering, but “observational.” The suit also stated that some of the employees at the site were not licensed engineers.

AvalonBay was originally seeking $100,000, but later changed the figure to $89,000.

According to Mayor Liz Lempert, the town does not admit to doing anything wrong in the settlement agreement.

“The municipality stands by the fact that these charges were proper,” Ms. Lempert said last week before the August 21 Council meeting. “Our decision to settle was based on an effort to try to avoid continued litigation costs and conserve staff resources.”

This is not the first dispute between AvalonBay and the municipality. This past June, an appeals court upheld a lower court’s ruling over how long an affordable housing restriction must stay in place. As a result, the developer must price 56 units at the Witherspoon Street complex at below market rates for at least 30 years. Previous to that lawsuit, AvalonBay took the town to court twice.