City and Borough of Juneau v. Breck
| Decision Date | 20 September 1985 |
| Docket Number | No. S-661,S-661 |
| Citation | 706 P.2d 313 |
| Parties | The CITY AND BOROUGH OF JUNEAU, and Kiewit Construction Company, Petitioners, v. Betty BRECK, a/k/a "Belle Blue," Respondent. |
| Court | Alaska Supreme Court |
Avrum Gross and Susan Burke, Gross & Burke, Juneau, for petitioner City and Borough of Juneau.
John E. Casperson and Lawrence T. Feeney, Faulkner, Banfield, Doogan & Holmes, Juneau, for petitioner, Kiewit Const. Co.
Betty Breck, pro per.
Before RABINOWITZ, C.J., and BURKE, MATTHEWS, COMPTON and MOORE, JJ.
The superior court granted Breck's request for a preliminary injunction, stopping further work under the contract between the City and Borough of Juneau (CBJ) and the Kiewit Construction Company for the construction of a parking structure and tourist facility located on Juneau's waterfront. Breck alleged, in part, that the multi-million dollar contract was illegal and void because it violated the CBJ charter and ordinance code, which requires CBJ to award contracts for public improvement projects through a competitive bidding procedure to the lowest bidder. At the time the superior court issued its preliminary injunction the structure was approximately 50 per cent completed. 1
The superior court issued the preliminary injunction after it found that Breck had demonstrated a high probability of success on the merits, and that Breck had shown irreparable injury for which there was no adequate and complete remedy at law: "the harm [being] that the safeguards that were incorporated into the basic Charter, the basic law of this community, have been disregarded, set aside, and that this is a wrong, per se, to all the citizens and taxpayers of this community, even if it saves money."
CBJ thereafter filed a petition for review in which it argued, in part, that this court should reverse the superior court's laches ruling (1) because it was erroneous, (2) because of the financial hardship the city experienced as a result of the preliminary injunction, and (3) because a reversal of the superior court's determination would materially advance the resolution of this litigation. 2 We granted the petition for review and dissolved the preliminary injunction. This court's order reads in part:
The superior court's ruling as to whether the equitable defense of laches should bar respondent Breck's claims for injunctive relief is REVERSED. Breck's delay in instituting this action was inexcusable and resulted in undue prejudice to Petitioner City and Borough of Juneau. Therefore, laches bars any claims on Breck's part for injunctive relief against Petitioners.... The matter is REMANDED for further proceedings not inconsistent with this order. More particularly, for determination of Breck's declaratory judgment action and any other non-injunctive relief deemed appropriate in the circumstances. 3
On December 9, 1983, CBJ first publicly announced its intention to seek "design-build" proposals for construction of a parking garage and marine park adjacent to the downtown Juneau waterfront. Proposals were accepted up until March 2, 1984. One month later, on April 4, the City selected the plan that Kiewit Construction had submitted. A contract was executed on May 3, 1984, for a total contract price of $5,075,000. Under the terms of the contract a substantial portion of the project was to be completed over an eight month period; the parties expected the first three floors of the parking garage to be operational by December 31, 1984.
Sometime in late March after proposals were solicited, but before acceptance of Kiewit's plan, Betty Breck became aware of possible charter and code violations and approached the mayor with her concern. On April 2, Betty Breck made the first of at least nine appearances before the assembly to express her concern that the "design-build" method of bidding and construction did not conform with Section 9.14 of the CBJ Charter, which requires that contracts for public improvements be let by competitive bid. 4 Breck continued to appear before the borough assembly after the award of the contract to Kiewit. Additionally, Breck was aware that construction had begun in the middle of May.
Breck contends that she did not realize until the end of June that she "would not get anywhere" talking to the borough assembly, and it was then that she began preparing for the lawsuit. Since she was financially unable to hire counsel, and was unsuccessful in soliciting the assistance of the three contractors whose proposals were rejected, Breck proceeded to master the legal procedures herself, spending eight hours a day in the law library up until the time she filed suit on August 24, 1984. 5 Thus, Breck filed suit approximately eight months after the city advertised its intent to seek "design-build" proposals, four months after the contract with Kiewit Construction was signed, and after approximately 50 per cent of the project was completed. 6
In Moore v. State, 553 P.2d 8, 15 (Alaska 1976), this court said that the question of whether laches bars a suit is "properly addressed to the discretion of the trial court and will not be overturned [absent] a definite and firm conviction that a mistake has been committed." 7 In Moore we further stated that the defendant must show two "independent" elements before the equitable defense of laches will be applied. The defendant must show, (1) that the plaintiff has unreasonably delayed in bringing the action, and (2) that this unreasonable delay has caused undue harm or prejudice to the defendant. 8 Id. Since the superior court concluded that Breck did not unreasonably delay in bringing the action, it did not really consider the extent of the injury to CBJ.
In applying the two-element test of Moore, one of the factors to be considered in measuring the plaintiff's delay is when, under the circumstances, it becomes no longer reasonable for the plaintiff to assume that the defendants would comply with the law. 9 Additionally, the court will "look to that point in time when there were positive steps taken by defendants which made their course of conduct irrevocable, and would have galvanized reasonable plaintiffs into seeking a lawyer." 10 Id. at 17.
In part, the superior court decided that Breck did not unreasonably delay in instituting suit because members of the assembly had given her grounds to believe that they would respond to her concerns. In its decision, the superior court noted that on June 4, 1984, the assembly agreed to place the matter on their next meeting's agenda, and that it was not until after the assembly had failed to act at the June 18 meeting that it should have become plain to Breck that she would have to turn to the courts for relief.
CBJ contends that a reasonable person would have known long before June that the City had embarked on a course of action that it would not alter unless forced to. To support this contention, they argue that Breck should have realized that the large financial commitment, and the delay that would result if the contract was declared void, made such a change inconceivable. 11
We are in agreement with petitioners' position, and reverse the superior court's resolution of the laches issue. In our view, once the contract was signed and construction commenced, a reasonable person would have realized that CBJ would not change its mind with respect to the project. In short, we hold that the signing of the contract and the commencement of work under the contract would have galvanized a reasonable plaintiff into seeking a lawyer. See Moore v. State, 553 P.2d at 17.
In reaching our holding on the laches issue, we reject the superior court's conclusion that Breck's delay in bringing suit was excusable because, considering her lack of knowledge about how to bring a lawsuit, she did the best she could in the circumstances. 12 Implicit in the superior court's view is the notion that delay resulting from insufficient resources is always a valid excuse, so long as the plaintiff proceeds in as diligent a manner as possible. We think such an approach is inappropriate. 13 Although this element should be factored into the equity equation, the question cannot be simply one of negligence. 14
Prejudice to the taxpayers of CJB is a relevant consideration in making a laches determination. In his affidavit, Chris Roust, an architect employed by CBJ, estimated that "the total additional cost of cancelling the current contract and then proceeding with conventional design-bid contraction [sic] would be between $1,500,000 and $2,000,000." Keith Gerken, a private architect employed in Juneau and hired by CBJ to estimate the loss, concluded that "the injunction now in force will cost CBJ and its residents as much as 1.5 million dollars and probably more." 15
Based on the foregoing, it is our conclusion that the superior court erred in refusing to apply the equitable doctrine of laches to Breck's claims for injunctive relief. In our view, petitioners demonstrated that Breck was guilty of inexcusable delay in instituting this action for injunctive relief, and that her inexcusable delay resulted in undue prejudice to petitioner CBJ. 16 The superior court should have given due consideration to such prejudice.
We therefore hold that the equitable defense of laches is a bar to Breck's claims of injunctive relief against petitioners.
REVERSED.
I dissent from the holding that Breck's action is barred by laches.
The trial court found that Breck gave ample notice of her opposition to the project and the reasons for it, and did not, under the circumstances, unreasonably delay in bringing suit. The court found also that the alleged injury to petitioners was not caused by Breck's delay, but rather by their own haste in proceeding with the project despite the serious questions raised...
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