Black v. Young

834 P.2d 304, 122 Idaho 302, 1992 Ida. LEXIS 135

• Court: Idaho Supreme Court
• Decided: July 10, 1992
• Docket: 19294
• Status: Published

Opinions

McDEVITT, Justice.

BACKGROUND

In August of 1987, the Blacks purchased a portion of a city block located in the City of Ketchum. An alley ran through the middle of the city block, and the Blacks owned property on both sides of the alley. This alley had been blocked off on one end by the only other property owner on the block. The Blacks intended to build a motel on this property.

On November 30, 1987, the Blacks applied to the Ketchum Planning and Zoning Commission (“Commission”) for vacation of the portion of the alley that runs adjacent to their property. The Commission recommended that the Ketchum City Council (“City Council”) vacate the alley.

On December 21, 1987, the matter came up before the City Council. After some discussion, the City Council tabled the matter for a special session to be held on December 29, 1987.

On December 29, 1987, the City Council took up the matter again in special session. At this meeting, the Blacks offered the City of Ketchum $5,000.00, an old log cabin on the property, and any salvageable material from the service station located on the property.

On January 18, 1988, the City Council took up the matter again. After some discussion, the City Council tabled Ordinance Number 471, the proposed ordinance to vacate the alley.

On February 1, 1988, the City Council again took up consideration of the proposed ordinance. At this meeting, the Blacks expressed concerns about the proposed ordinance. Specifically, the Blacks were concerned with the vacation of the alley being tied to approval of the design of the project and that the alley would not be vacated until the City of Ketchum issued a certificate of occupancy for the motel. The matter was tabled again.

On February 16, 1988, the City Council met and discussed the Black’s redesign of the motel project. The Blacks remained firm that the City Council’s requirements for vacation of the alley were unacceptable to them.

On April 4,1988, and after submission of the design plan, the City Council unanimously adopted Ordinance Number 471.¹ Sections 2 and 3 of Ordinance Number 471 conditioned vacation of the alley upon the issuance of a building permit and the funding of a construction loan in the amount of $2,500,000.00. In addition, Ordinance Number 471 §§ 2 and 3 gave the City of Ketchum a right of reversion if a certificate of occupancy was not issued for the motel. On the same day, the Blacks signed an estoppel affidavit which provided that the conditions of the ordinance were acceptable to them and would not be challenged by them.

On August 1, 1988, the City Council considered and approved a one year extension of time for the Blacks to apply for a building permit.

The Commission approved the revised plans for the motel, including reduced underground parking spaces and increased above-ground parking spaces. The City Planning Department appealed this decision to the City Council. The appeal came up on May 15, 1989. After this hearing, the City Council reversed the decision of the Commission.

On December 4, 1989, the Blacks presented new plans for the project to the City Council. Without vote, the City Council advised the Blacks that the new plans were unacceptable. The focus was on the lack of underground parking in the new plan.

On February 20, 1990, the City Council again took up the matter, this time discussing with the Blacks the parking arrangements. The parties scheduled a work session for a later date.

On March 7, 1990, the work session was held. However, on June 18, 1990, the City Council denied the Commission’s recommendation to approve the new plan.

PROCEDURE

On December 3, 1990, the Blacks filed a complaint against the mayor and city council members of the City of Ketchum. The complaint described the property in question, alleged that the mayor and city council members enacted Ordinance Number 471, that § 2 of Ordinance Number 471 was ultra vires, that the defendant’s requirement that the Blacks sign an estoppel affidavit was ultra vires, that the right of reversion contained in Ordinance Number 471 was ultra vires, and that these conditions were ultra vires because of I.C. § 50-311. The Blacks prayed for title to the property, delivery of a quitclaim deed from defendants, and costs and fees, including development costs.

On December 21, 1990, the Blacks filed an amended complaint. The only change in the amended complaint was the addition of the City Council of Ketchum and the City of Ketchum as defendants. These new defendants, along with the original defendants, comprise the respondents, City of Ketchum.

On January 29, 1991, the original defendants filed an answer to the complaint. In the answer, the original defendants listed nine affirmative defenses: (1) failure to state a claim; (2) waiver; (3) estoppel; (4) consent; (5) laches; (6) failure to satisfy conditions precedent; (7) fraud; (8) authority of statute or ordinance; and (9) immunity-

Also on January 29, 1991, the original defendants filed a motion for summary judgment. In their motion for summary-judgment, the original defendants asserted that the city has the authority to impose conditions upon ordinances to vacate streets or alleys, that the Blacks are es-topped to deny the validity of the ordinance, and that the Blacks’ claim is barred by I.C. § 67-6521(d). The original defendants also filed a supporting memorandum.

On January 31, 1991, the Blacks filed an application for the entry of default as to the City of Ketchum and the City Council. The application for the entry of default was filed pursuant to I.R.C.P. 55(a)(1). The district court entered an order granting the application on the same day conditioned upon proper service.

On February 11, 1991, the Blacks filed a motion for summary judgment. In their motion for summary judgment, the Blacks asserted that the City of Ketchum had no authority to impose conditions, that the conditions were ultra vires, in violation of I.C. § 50-311, that they were not estopped to deny the validity of the conditions, that the Local Planning Act does not bar their claim, and that the City of Ketchum did not plead fraud with particularity. The Blacks also filed a supporting memorandum.

On February 15, 1991, the Blacks filed a motion for the entry of default judgment against the City of Ketchum and the City Council. In addition, the Blacks filed a supporting memorandum, which stated “[a]s of February 11,1991, neither the City Council of Ketchum nor the City of Ketchum has made an appearance or filed an answer in this matter.”

On February 22, 1991, the City of Ketchum filed an amended answer to the complaint. The amended answer listed all parties comprising the respondents, City of Ketchum, as defendants.

After various supporting and opposing memorandums were filed, the district court entered an order denying the Blacks’ motion for entry of default judgment, and granting the City of Ketchum’s motion to set aside the entry of default.

On April 1, 1991, the district court entered its memorandum decision and order regarding the cross-motions for summary judgment. The district court denied the Blacks’ motion for summary judgment and granted Ketchum’s motion for summary judgment. In the memorandum decision and order, the district court reasoned as follows:

The Court finds that the parties in this action were competent and represented by counsel when they arrived at a meeting of the minds regarding the vacation of the alley in question. All legal and practical aspects of the agreement were negotiated in good faith, were agreed upon and were set forth in a contract that is clear and concise. The terms of the contract were set forth in Ketchum City Ordinance 471, section 2. Under the terms of this section the vacation of the alley was conditioned upon plaintiffs obtaining two specific items; a building permit for the motel approved under Plan No. CR-88-002, and the funding of a construction loan in the amount of at least $2,500,000.00. The Court finds that at the time of the hearing of these motions neither of the two conditions set forth in Ordinance 471, section 2 have been completed.

Plaintiffs now petition this Court to have their required performance under the contract waived while continuing to hold defendants to their agreed performance. The basis for the plaintiffs’ position is that the City acted without the authority to impose such conditions on the vacation of the alley in question. If this position were sustained it would result in a financial windfall for plaintiffs, and an equal financial detriment to the City. Not only would the City suffer financially, but the health, safety and welfare of the citizens would be effected and deterred through the loss of a valuable thoroughfare. The Court finds that pursuant to statutory mandate the City was within its’ authority imposing such conditions for the public good.

Plaintiffs have also attempted to convince the Court that the City sold the alley in question for the consideration of an old cabin of limited value. The Court finds that this transaction was not a part of the parties original contract as set forth in Ordinance 471, section 2. This transaction was separate and distinct from the parties original agreement.

Since plaintiffs have not performed their required obligations as set forth in the contract, and these obligations were precursors to defendants’ required vacation of the alley, the Court finds that defendants are not required to perform the described vacation, and that the parties are returned to the pre-contract status quo.

Thereafter, the Blacks filed a notice of appeal pursuant to I.A.R. 11(a)(1) “from the Memorandum Decision and Order filed April 1, 1991.”

On May 7, 1991, the district court entered its judgment. In its judgment, the district court dismissed the Blacks’ complaint in its entirety and retained jurisdiction for awarding costs and attorney fees.

The Blacks filed an amended notice of appeal on May 13, 1991, appealing from both the April 1, 1991 order and the May 7, 1991 judgment.

After a hearing held on June 10, 1991, the district court entered an amended judgment on June 12, 1991. In the amended judgment, the district court awarded the City of Ketchum costs in the amount of $694.03 and attorney fees in the amount of $8,297.25 with interest charged at a rate of 13.25% per annum.

ANALYSIS

In order to resolve this appeal, we must address the following issues:

1. Are the conditions attached to the ordinance ultra vires?

II. Did the district court err in awarding attorney fees to the City of Ketchum?

I.

Are the Conditions Attached To The Ordinance Ultra Vires?

Ordinance Number 471, §§ 2 and 3, contains the following conditions:

1. Issuance of a building permit prior to vacation of the alley, and

2. Funding of a loan in the amount of at least $2,500,000.00 from an institutional lender to pay the cost of constructing the motel prior to vacation of the alley.

In addition, the ordinance gives the City of Ketchum a right of reversion to the alley if a certificate of occupancy is not issued before the right to a certificate of occupancy has expired.

The district court based its decision upon a contract theory. In concluding that the City of Ketchum had authority to impose the above-listed conditions upon the vacation ordinance, it essentially ruled that the ordinance was a contract between the City of Ketchum and the Blacks, that the above-listed conditions were conditions precedent to performance, i.e., vacating the alley, by the City of Ketchum, and that the Blacks had not performed the conditions precedent. Therefore, the district court held that the City of Ketchum was excused from its performance and returned the Blacks and the City of Ketchum to the status quo. We cannot agree with this theory.

The legislature has provided I.C. § 50-311² as the method for municipal corporations to follow when vacating an alley.³ This statute empowers municipal corporations to “vacate [any alley] whenever deemed expedient for the public good ... [provided that] the right of way, easements and franchise rights of any lot owner or public utility shall not be impaired thereby.” I.C. § 50-311. Idaho Code § 50-311 does not empower a municipal corporation to impose any conditions upon the vacation of an alley except for the proviso regarding impairment of the right of way, easements, and franchise rights of lot owners and public utilities.

In Byrns v. City of Moscow, 21 Idaho 398, 403, 121 P. 1034, 1036 (1912), this Court stated:

[W]e think that the constitution, art. 11, secs. 1 and 2, clearly confers power upon the legislature to provide for the incorporation, organization and classification of cities, and that such cities and towns shall have the power and authority given them by the laws enacted by the legislature. And where the legislature enacts laws providing the method to be adopted and followed by cities and villages in making local improvements, such cities and villages are required to pursue the methods and provisions of the law authorizing such improvements.

In O’Bryant v. City of Idaho Falls, 78 Idaho 313, 320, 303 P.2d 672, 674-75 (1956), we held that municipal corporations have three sources of power and no others:

1. Powers granted in express words;

2. Powers fairly implied in or incident to those powers expressly granted; and

3. Powers essential to the accomplishment of the declared objects and purposes of the corporation.

This Court has recently reiterated this rule in Alpert v. Boise Water Corp., 118 Idaho 136, 142, 795 P.2d 298, 304 (1990). (“Municipal corporations in Idaho may exercise only those powers granted to them by the state Constitution or the legislature.”)

A city ordinance that is in conflict with a state law of general application is invalid. Mix v. Board of Cty. Comm’rs, 18 Idaho 695, 112 P. 215 (1910). See also Garten Enter., Inc. v. Kansas City, 219 Kan. 620, 549 P.2d 864 (1976); Lakewood Pawnbrokers, Inc. v. City of Lakewood, 183 Colo. 370, 517 P.2d 834 (1973); Application of Anamizu, 52 Hawaii 550, 481 P.2d 116 (1971); and City of Libby v. Harwell, 147 Mont. 492, 414 P.2d 652 (1966). This Court has defined “general laws” to be “provisions of the Constitution, acts of the state legislature and the Constitution and laws of the United States.” State v. Clark, 88 Idaho 365, 375, 399 P.2d 955, 960 (1965).

Idaho Code § 50-311, which applies to all municipal corporations in the state of Idaho and is an act of the state legislature, is clearly a state law of general application. It provides the method for municipal corporations to follow in vacating alleys. The two conditions that the City of Ketchum imposed upon vacation of the alley, as well as the right of reversion should a certificate of occupancy not be issued, are not expressly granted powers, fairly implied powers from the clear language of I.C. § 50-311, nor are they powers essential to the vacation of the alley. The only condition that I.C. § 50-311 allows upon a finding of expedience for the public good is that the vacation cannot impair “the right of way, easements and franchise rights of any lot owner or public utility.” I.C. § 50-311. Thus, the two above-listed conditions, as well as the right of reversion, are ultra vires acts by the City of Ketchum because they conflict with I.C. § 50-311. Mix, 18 Idaho at 704-05, 112 P. at 218.

Because we hold the conditions and right of reversion to be beyond the authority of the City of Ketchum, it is necessary to address whether only those portions of the ordinance are invalid or whether the entire ordinance is null and void.

Section 5 of Ordinance Number 471 is a savings and severability clause, providing that if a court should find a provision of the ordinance to be invalid, the remainder of the ordinance shall continue in full force and effect. In addition, the Blacks argue that if a portion of an ordinance is not an integral or indispensable part of the measure, then that part alone may be invalidated without affecting the remainder. For authority, the Blacks cite Voyles v. City of Nampa, 97 Idaho 597, 548 P.2d 1217 (1976).

Section 1 of Ordinance Number 471 states that “it is found by the Ketchum City Council to be in the best interest of the City of Ketchum and for the public good and convenience, provided that the motel ... is built, that said portion of said alley hereinafter be vacated.” (Emphasis added.) The only “public good” found by the City of Ketchum in Ordinance Number 471 was the construction of the motel.

So, the City of Ketchum found that it was expedient for the public good to vacate the alley if the motel was built. Additionally, the parties do not dispute that the public good requirement would be satisfied by construction of the motel. In fact, in the estoppel affidavit, the Blacks acknowledged that “[w]e understand the City of Ketchum has determined that, provided the motel is constructed, the alley is not needed as a public thoroughfare.” The problem, then, with striking only the two conditions and the right of reversion from the ordinance is that the statutorily mandated finding of “expedient for the public good” would be defeated. However, we are unable to discern, from this record, whether there was some other independent basis for the public good requirement. For this reason, we reverse the judgment of the district court and remand the case to the trial court to determine if other factors existed or were considered regarding the public good requirement of I.C. § 50-311.⁴

II.

Did The District Court Err In Awarding Attorney Fees To The City Of Ketchum?

The Blacks contend that the district court erred in awarding $8,297.25 in attorney fees to the City of Ketchum. Specifically, the Blacks point to the failure of the district court to make findings regarding the award and to designate a rule or code section pursuant to which the fees were awarded.

Idaho Rules of Civil Procedure 54(e)(1) and 54(e)(2) require the district court to make findings of fact before awarding attorney fees. In addition, I.R.C.P. 54(e)(1) requires that the case be brought “frivolously, unreasonably or without foundation” before attorney fees may be awarded. When the district court grants attorney fees to the prevailing party, I.R.C.P. 54(e)(3) requires the district court consider certain factors. In the present case, the district court made no written findings regarding its award of attorney fees to the City of Ketchum. The only indication that attorney fees were addressed appears in the court minutes of June 10,1991, wherein it is written “case frivolous & unreasonable.”

While an award of attorney fees is within the “unique expertise and discretion” of a trial court, such an award cannot be sustained “where the record itself discloses that the claim was not frivolously pursued.” J.M.F. Trucking v. Carburetor & Electric of Lewiston, 113 Idaho 797, 799, 748 P.2d 381, 383 (1987). The district court based its summary judgment upon a contract theory. We have found the district court’s reasoning to be incorrect. Instead, we agree with the Blacks that the conditions and right of reversion attached to Ordinance Number 471 are ultra vires. We affirm the decision of the district court only insofar as the ordinance did not vacate the alley. Had the conditions and right of reversion not been an integral and indispensable part of the ordinance, we could have invalidated only those portions and saved the rest. Our review of the record, therefore, reveals that the case was not brought frivolously, unreasonably, or without foundation, but that it instead was pursued upon a meritorious, reasonable, and well founded legal theory. We therefore vacate that portion of the district court’s judgment awarding $8,297.25 in attorney fees to the City of Ketchum.

Finally, the City of Ketchum requested attorney fees on appeal. However, we are not left with “the abiding belief that the appeal was brought, pursued or defended frivolously, unreasonably or without foundation.” Minich v. Gem State Dev., Inc., 99 Idaho 911, 918, 591 P.2d 1078, 1085 (1979). We decline to award attorney fees on appeal to the City of Ketchum.

For the foregoing reasons, we vacate that portion of the judgment awarding attorney fees to the City of Ketchum, and reverse and remand the remaining judgment for further consideration consistent with this opinion regarding the public good requirement of I.C. § 50-311.

No costs on appeal.

BAKES, C.J., and REINHARDT, J., Pro Tem, concur.

1 . The ordinance reads in full:

ORDINANCE NUMBER 471

AN ORDINANCE OF THE CITY OF KET-CHUM, BLAINE COUNTY, IDAHO, VACATING THAT PORTION OF THE ALLEY RUNNING THROUGH BLOCK 1 ADJACENT TO LOTS 1, 2, 3, 5, 6, AND 7, THEREOF, AS SHOWN ON THE PLAT OF THE ORIGINAL TOWNSITE OF KET-CHUM; AND, ORDERING CONVEYANCE TO ADJACENT PROPERTY OWNER; PROVIDING A REPEALER CLAUSE; PROVIDING A SAVINGS AND SEVERABILITY CLAUSE; AND, PROVIDING AN EFFECTIVE DATE.

BE IT ORDERED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF KETCHUM, BLAINE COUNTY, IDAHO:

SECTION 1. That upon the Ketchum City Council having obtained the written consent to said vacation from the property owners adjoining said portion of the alley running through Block 1 of Ketchum Townsite adjacent to Lots 1, 2, 3, 5, 6, and 7, thereof, and having held a public hearing before the Ketchum City Council upon notice as required by law, it is found by the Ketchum City Council to be in the best interest of the City of Ketchum and for the public good and convenience, provided that the motel for which the Ketchum Planning and Zoning Commission granted design review approval under plan number CR-88-002 is built, that said portion of said alley hereinafter described be vacated; that no damage results to any adjoining property owners or anyone else; that provided said motel is constructed there is no need for said portion of said alley as a public thoroughfare as properties on all sides of said alley has never been opened, improved or maintained within the platted right-of-way by the City of Ketchum and to do so would be unnecessary; and, that vehicular circulation in the vicinity is in no way affected by said vacation.

SECTION 2. That effective upon the issuance of a building permit for the motel approved by the Ketchum Planning and Zoning Commission under plan number CR-88-002, and the funding of a loan in the amount of at least $2,500,000 from an institutional lender to pay the cost of constructing the said motel, the portion of the alley running through Block 1, as shown on the Official Plat of the Original Townsite of Ketchum, Idaho, being more particularly described as the one hundred sixty-five feet (165') in length and twenty feet (20’) in width of said alley adjacent to Lots 1, 2, 3, 5, 6, and 7, Block 1, Official Plat of the Original Townsite of Ketchum IS HEREBY VACATED, save and except that this grant is made subject to the right of reversion described in this section 2, and all existing easements, franchise and utility rights and other encumbrances of record. In the event that a certificate of occupancy for the said motel is not issued before the right to a certificate of occupancy has expired, then the title to the real property vacated by this ordinance shall revert to and rest absolutely in the City of Ketchum without further action or notice on the part of the City of Ketchum and shall automatically constitute a rededication of the property vacated by this ordinance as an alley, and all rights secured under this ordinance shall automatically become null and void. Upon request, the City of Ketchum agrees to subordinate its reversionary interest to a lien in favor of an institutional lender to secure a loan the proceeds of which will be used exclusively to pay the cost of constructing the said motel.

SECTION 3. Title to the real property vacated by this ordinance shall, subject to the right of reversion contained in Section 2, above, revert to the owners of record of the adjoining Lots 1, 2, 3, 5, 6, and 7, Block 1, Ketchum Townsite upon the issuance of a building permit for the motel approved by the Ketchum Planning and Zoning Commission under plan number CR-88-002 and the funding of a loan in the amount of at least $2,500,000 from an institutional lender to pay the cost of constructing the said motel. The said reversion of title shall be evidenced by the City of Ketchum executing a quitclaim deed of said vacated property thereby incorporating said vacated property into said adjoining lots.

SECTION 4. REPEALER CLAUSE. All ordinances or parts thereof in conflict herewith are hereby repealed.

SECTION 5. SAVINGS AND SEVERABILITY CLAUSE. If any section, paragraph, sentence or provision hereof of the application thereof to any particular circumstance shall ever be held invalid or unenforceable by a Court of competent jurisdiction, such decision shall not affect the remainder hereof, which shall continue in full force and effect and applicable to all circumstances to which it may validly apply.

SECTION 6. EFFECTIVE DATE. This ordinance shall become effective upon its passage, approval and publication according to law.

PASSED BY THE KETCHUM CITY COUNCIL and approved by the Mayor this 4th day of April. 1988.

/s/

Lawrence J. Young

Mayor

ATTEST:

/s/

Betty A. Coles

City Clerk

2 . This statute provides in full:

50-311. Creation — Vacation of streets — Eminent domain — Reversion of vacated streets.— Cities are empowered to: create, open, widen or extend any street, avenue, alley or lane, annul, vacate or discontinue the same whenever deemed expedient for the public good; to take private property for such purposes when deemed necessary, or for the purpose of giving right of way or other privileges to railroad companies, or for the purpose of erecting malls or commons; provided, however, that in all cases the city shall make adequate compensation therefor to the person or persons whose property shall be taken or injured thereby. The taking of property shall be as provided in title 7, chapter 7, Idaho Code. The amount of damages resulting from the vacation of any street, avenue, alley or lane shall be determined under such terms and conditions as may be provided by the city council. Provided further that whenever any street, avenue, alley or lane shall be vacated, the same shall revert to the owner of the adjacent real estate, one-half ('A) on each side thereof, or as the city council deems in the best interests of the adjoining properties, but the right of way, easements and franchise rights of any lot owner or public utility shall not be impaired thereby. In cities of fifty thousand (50,000) population or more in which a dedicated alley has not been used as an alley for a period of fifty (50) years [such alley] shall revert to the owner of the adjacent real estate, one-half ('A) on each side thereof, by operation of law, but the existing rights of way, easements and franchise rights of any lot owner or public utility shall not be impaired thereby.

3 . The City of Ketchum commingles the Local Planning Act, title 67, chapter 65, Idaho Code, with the argument concerning the power to impose conditions upon the vacation of an alley. The Local Planning Act, however, deals with zoning powers. The situation that we face is the vacation of an alley, to which the legislature has specifically spoken in I.C. § 50-311.

4 . We take note of the Black’s argument that if the conditions were proper under Idaho law, they would need to have been set forth in the short title in order to be effective. Idaho Code § 50-902 provides that ’’[i]n preparation, passage and publication, ordinances shall contain no subject which shall not be clearly expressed in the title____’’ It is clear that the subject of the ordinance is vacation of an alley, and that subject is clearly expressed in the title: "AN ORDINANCE ... VACATING THAT PORTION OF THE ALLEY...."