Burner Serv. & Combustion Controls Co., Inc. v. City of Minneapolis

• Decision Date: 27 January 1977
• Docket Number: No. 46626,46626
• Citation: 250 N.W.2d 224,312 Minn. 104
• Parties: BURNER SERVICE AND COMBUSTION CONTROLS CO., INC., Appellant, v. CITY OF MINNEAPOLIS, Respondent.
• Court: Minnesota Supreme Court

Page 224

250 N.W.2d 224

312 Minn. 104

BURNER SERVICE AND COMBUSTION CONTROLS CO., INC. Appellant, v. CITY OF MINNEAPOLIS, Respondent.

No. 46626.

Supreme Court of Minnesota.

Jan. 27, 1977.

Syllabus by the Court

A municipality is bound by the terms of a stipulation of settlement entered into by its city attorney in a condemnation case, where the city attorney had been authorized by city council resolution to take all necessary steps to acquire the property sought, and where the stipulation was reasonable on its face and not conditioned upon approval by the council.

Carlsen, Greiner & Law and Jack D. Elmquist, Minneapolis, for appellant.

Walter J. Duffy, Jr., City Atty., Frank C. LaGrange and Jerome R. Jallo, Asst. City Attys., Minneapolis, for respondent.

Heard before TODD, MacLAUGHLIN, and YETKA, JJ., and considered and decided by the court en banc.

YETKA, Justice.

Burner Service and Combustion Controls Company, Inc. (Burner), appeals from a judgment entered on January 22, 1976, pursuant to an order by the district court granting the motion for summary judgment of the city of Minneapolis and denying Burner's motion for summary judgment. We reverse.

The issue presented in this appeal is whether the city attorney is, as a matter of law, without authority to bind the city to a stipulation of settlement with a condemnee, while acting pursuant to a resolution of the city council directing him to 'take all necessary steps to prepare for, institute, and prosecute on behalf and in the name of the City of Minneapolis all such condemnation proceedings as may be necessary for the acquisition by said City of Minneapolis (of Burner's property interest), the costs thereof to be paid from (funds authorized for this purpose).'

This appeal arises out of a condemnation proceeding instituted by the city of Minneapolis as part of a development district in the Nicollet-Lake area where Burner leased property.

On November 22, 1972, the city council designated the Nicollet-Lake area a development district. Shortly thereafter it authorized funding for the district. Walter J. Duffy, Jr., the city attorney, was authorized to purchase or condemn property in the district.

On May 8, 1974, a condemnation proceeding was brought by the city. The petition listed Burner as a respondent and recited that the city attorney was given authority to direct condemnation proceedings on behalf of the city and that the city deemed it necessary to secure the land under the 'quick take' provision of Minn.St. 177.042. ¹

The petition was heard on June 18, 1974, before Judge Edward Parker, who allowed the condemnation to proceed but denied the city's request for a 'quick-take' and immediate possession.

On December 12, 1974, Burner's president, Thomas A. Ryan, and an assistant city attorney signed a stipulation of settlement. The settlement provided for payment of $15,778, allocating $7,500 to the present value of Burner's leasehold interest and $8,278 to Burner's irremovable fixtures, in return for a quit claim deed from Burner and the termination of Burner's interests in the premises on March 29, 1975.

A problem developed on February 4, 1975, when the assistant city attorney informed Burner's attorney that the city would not pay the portion of the settlement previously allotted to Burner's leasehold interest ($7,500) because an examination of Burner's lease disclosed a clause which, in the city's opinion, terminated Burner's leasehold interest in the event of condemnation.

In response, Burner instituted an action in district court for breach of the stipulation of settlement. Cross-motions for summary judgment were heard, and the city's motion was granted and Burner's motion was denied. Burner appeals from the judgment entered.

A motion for summary judgment may be granted only when the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that a party is entitled to a judgment as a matter of law. Rule 56.03, Rules of Civil Procedure; Couillard v. Charles T. Miller Hospital, Inc., 253 Minn. 418, 92 N.W.2d 96 (1958); 10 Dunnell, Dig. (3 ed.) § 4988b.

In Sauter v. Sauter, 244 Minn. 482, 484, 70 N.W.2d 351, 353 (1955), this court stated the rules governing a motion for summary judgment as follows:

'A motion for a summary judgment may be granted pursuant to Rule 56.03 only if, after taking the view of the evidence most favorable to the nonmoving party, the movant has clearly sustained his burden of showing that there is no Genuine issue as to any Material fact and that he is entitled to judgment as a matter of law. It is essential to bear in mind that the moving party has the burden of proof and that the nonmoving party has the benefit of that view of the evidence which is most favorable to him. The salutary purpose and useful function of summary judgment proceedings as a means of securing the just, speedy, and inexpensive determination of the action (Rule 1) is well recognized, but resort to summary judgment was never intended to be used as a substitute for a court trial or for a trial by jury where any genuine issue of material fact exists. In other words a summary judgment is proper where there is no issue to be tried but is wholly erroneous where there is a genuine issue to try.

'The controlling words Genuine issue and Material fact need no amplification since they best speak for themselves. Their application in determining whether there is an absence of a Genuine issue as to a Material fact requires a careful scrutiny of the pleadings, depositions, admissions, and affidavits, if any, on file. Since, however, all factual inferences must be drawn against the movant for summary judgment, it follows that, even where the movant's supporting documents are uncontradicted, they may in themselves be insufficient to sustain his burden of proof.'

Thus, in view of these governing principles, the granting of the city's motion for summary judgment can be upheld only under one of two circumstances: (1) if, as a matter of law, a city attorney may not bind the city to a stipulation of settlement under any circumstances; or (2) if such authority may exist, the facts before us raise no genuine issue as to the actual authorization of the city attorney to enter into a settlement on behalf of the city.

The city contends that the signing of the stipulation of settlement by the city attorney was the attempted performance of a nondelegable duty of the city, and as such, no legal effect can be given to the city attorney's acts. The city further contends that Burner must be presumed to know the extent of the power of the officers with whom it dealt and is thus precluded from arguing either actual authority or estoppel premised on actions within the permissible scope of the officer's authority.

Burner, on the other hand, contends that the city attorney not only had the power but also the specific authorization to settle under the condemnation action initiated by the city attorney under the direction of the city council.

In granting the city's motion for summary judgment, the trial court agreed with the city's position. It found that the signing of the settlement agreement by the city attorney involved the attempted delegation of a nondelegable duty, stating in its memorandum:

'In Wilson v. Minneapolis, 283 Minn. 348, 168 N.W.2d 19 (1969), the Minnesota Supreme Court held that municipal officers cannot go beyond the authority given them by law, nor delegate powers involving judgment or discretion. In other words, the City Council cannot delegate its powers that call for judgment or discretion on its part, but must exercise those powers itself.

'* * * It is this Court's opinion that a decision to pay money out of the City's Treasury in a condemnation proceeding is a power involving judgment or discretion by the City Council and, therefore, must be exercised solely by the City Council and not by anyone presumably or Actually having received authority to make that decision for the City Council.

'* * * Since this Court has already determined that the City Council alone had power to deal with any condemnation awards, no representative from the City Attorney's office could obligate the City Council to the stipulation in this case, regardless of the fact that plaintiff may have relied on that representative's action.' (Italics supplied.)

Both the trial court and the city rely on provisions of the Minneapolis City Charter for their conclusion that the city is without authority to enter into stipulation agreements involving condemnation. Minneapolis City Charter, c. 4, § 14, provides:

'The City Council shall have the management and control of the finances and all property of the city * * *.'

Minneapolis City Charter, c. 5, § 26, also provides:

'No money shall be paid out of the City Treasury, except for principal or interest of bonds, unless such payment shall be authorized by a vote of the City Council, and shall then be drawn out only upon orders signed by the Mayor and Clerk and countersigned by the Comptroller-Treasurer, which orders shall specify the purpose for which they were drawn, and the funds out of which they are payable, and the name of the person in whose favor they may be drawn, and may be made payable to the order of such person or to the bearer, as the City Council may determine.'

Minneapolis City Charter, c. 4, § 15, further states:

'The City Council shall have the power to acquire by purchase or...