KTVB, Inc. v. Boise City

• Decision Date: 30 June 1971
• Docket Number: No. 10602,10602
• Citation: 94 Idaho 279,486 P.2d 992
• Parties: KTVB, INC., a corporation, and Boise Valley Broadcasters, Inc., a corporation, Plaintiffs-Appellants, v. BOISE CITY, a municipal corporation, et al., Defendants-Respondents.
• Court: Idaho Supreme Court

Page 992

486 P.2d 992

94 Idaho 279

KTVB, INC., a corporation, and Boise Valley Broadcasters, Inc., a corporation, Plaintiffs-Appellants, v. BOISE CITY, a municipal corporation, et al., Defendants-Respondents.

No. 10602.

Supreme Court of Idaho.

June 30, 1971.

Hawley, Troxell, Ennis & Hawley, Boise, for plaintiffs-appellant.

Elam, Burke, Jeppesen, Evans & Boyd, Boise, for respondent, General Communications & Entertainment Co., Inc.

Elbert Gass, City Atty., Boise, for respondents, Boise City and Boise City Council members.

McQUADE, Chief Justice.

This case comes before this Court after summary judgment was granted by the trial court. Issues of standing in court and estoppel are presented.

The focus of this controversy is a cable television franchise in Boise. Some time in 1965, the two existing television stations in Boise, KBOI and KTVB (plaintiffs and appellants herein) began their efforts to secure a cable television franchise for themselves in Boise and several surrounding communities. These efforts continued sporadically up to August of 1968, when fourteen cities in the Boise area, including Boise, formed a committee to draft specifications for bids for a cable television franchise. Each of the participating cities sent two members of the city government as their representatives on the committee.

The committee formulated specifications and advertised for bids preparatory to granting cable television franchises by the participating cities. Nine companies, including a joint venture formed by appellants and one other company, submitted bids which were opened on January 28, 1969. Appellants, as proponents of their joint venture bid, engaged in extensive efforts to convince the committee that the joint venture should be awarded the franchise. These efforts included a violation of the committee's rules governing consideration of the bids, by passing out printed copies of the joint venture's bid to certain members of the committee. The committee previously had determined that fairness would best be served by keeping the identity of the various bidders secret, referring among themselves to the bids submitted by numbers assigned thereto rather than by name of the bidder.

The executive committee of the general cable television committee recommended three applicants, by number only, to the general committee. Appellants' joint venture was not one of the three. Appellants' joint venture learned of this development, and attempted to gain further consideration of their bid by contacting certain members of the general committee. On February 13, 1969, the committee chose respondent General Communications & Entertainment Co., Inc. (GenCoe) as the recipient of the franchise. Thereafter, it remained for the participating cities to consider the committee's recommendation and, if approved, enact franchise ordinances. During the period between the recommendation of the committee on February 13, and the final adoption of the franchise ordinance involved in this action, appellants continued their efforts to secure the franchise for themselves. These efforts included the placing of full page newspaper advertisements, distribution of fly sheets, obtaining a private hearing before the Boise City Council, and participation in the public hearing on the question of granting the franchise.

After the public hearing on April 14, 1969, the Boise City Council voted four to two in favor of awarding to GenCoe a franchise for cable television, within the City of Boise. A contract was thereafter entered into between GenCoe and Boise City. From the record, it does not appear that appellants offered objections to the proceedings to award the franchise other than initiating this action, except for objections to the action of the general committee and later the Boise City Council in not considering the joint venture proposal along with the three finalist bids selected by the executive committee. In each instance, these objections were met by further consideration of appellants' bid. Appellants, after the franchise was awarded and the contract between respondents was executed brought the action resulting in this appeal.

The trial court granted respondents' motions for summary judgment on the ground appellants did not have standing to bring this action and on the ground that appellants, having participated in and acquiesced in the procedures leading to the award of the franchise, were thereby estopped from challenging that award. Appellants bring this appeal from the grant of summary judgment.

Appellants assert that the City acted illegally in entering into and 'being bound by' the agreement establishing the cable television committee, that the franchise award is illegal and invalid because the required competitive bidding procedure was not followed (citing I.C. § 50-341), and that the award is invalid because the individual members of the Boise City Council did not investigate or study any of the bid proposals submitted to them prior to adopting the ordinance. Appellants also contend that the franchise ordinance is invalid by reason of the pecuniary interest in the contract of councilman Frazier, who voted for the award to GenCoe (without whose vote it is urged, there were insufficient votes to enact the ordinance), ¹ that the ordinance is invalid as a regulation in an area of interstate commerce pre-empted by the federal government and as an unreasonable burden upon interstate commerce, that the franchise ordinance is an unlawful intrusion upon powers reserved to the State of Idaho, and that the ordinance is invalid because the cable television committee allowed GenCoe to materially alter its bid proposal after the closing date set for the receipt of bids. These contentions must be examined in the light of appeallants' prior conduct in relation to the bidding and award processes.

It is contended by respondents, and the trial court concluded, that appellants are estopped from challenging the franchise award under the equitable doctrine of 'quasi estoppel.' This Court has recognized that doctrine in the case of Clontz v. Fortner, ² wherein we quoted with approval the following definition:

"The term 'quasi estoppel' has been applied to certain legal bars which are in some respects analogous to estoppel in pais and which have the same practical operation as an estoppel in pais, but which nevertheless differ from that form of estoppel in essential particulars. Thus, it has been held that no concealment or misrepresentation of existing facts on the one side, no ignorance or reliance on the other, is a necessary ingredient.

'The doctrine classified as quasi estoppel has its basis in election, ratification, affirmance, acquiescence, or acceptance of benefits; and the principle precludes a party from asserting, to another's disadvantage, a right inconsistent with a position previously taken by him. The doctrine applies where it would be unconscionable to allow a person to maintain a position inconsistent with one in which he acquiesced, or of which he jaccepted a benefit."

Further definition and application of this equitable doctrine is found in the case of Godoy v. Hawaii, ³ where it is stated at pages 82 and 83,

'The estoppel claimed by appellant and recognized by the above-mentioned cases is that form of estoppel in pais called by text-writers and known to jurists as quasi estoppel. This class of estoppel is sometimes expressed in the language of the rule or maxim that one cannot blow both hot and cold. It is based upon the broad equitable principle which courts recognize, that a person, with full knowledge of the facts, shall not be permitted to act in a manner inconsistent with his former position or conduct to the injury of another. To constitute this sort of estoppel the act of the party against whom the estoppel is sought must have gained some advantage for himself or produced some disadvantage to another; or the person invoking the estoppel must have been induced to change his position, or by reason thereof the rights of other parties must have intervened. (Quoting from Yuen v. London Guar. & Acc. Co. et al., 40 Haw. 213, 229-230).

'The option lay with the appellee to conform to the law and to secure a certificate of convenience and necessity with its attendant benefits or insist upon the invalidity of the statute and stand upon the constitutional and statutory rights and privileges which he believed the statute invaded. He chose the former course. By such voluntary acceptance of benefit he is now estopped from assailing the validity of the statute. (Quoting from Wong v. Public Util. Comm., 33 Haw. 813 at 816).'

While appellants may not have been required to forego bidding on the franchise in order to raise the objections to the franchise that they now make, it is clear from Godoy that they at least were required to make some objection to the various deficiencies which they now claim existed in the bidding and granting processes, rather than to intimate full approval by their acquiescent conduct while harboring serious reservations about the processes. ⁴

The requirements for proper application of quasi estoppel are, then, that the person against whom it is sought to be applied has previously taken an inconsistent position, with knowledge of the facts and his rights, to the detriment of the person seeking application of the doctrine. It is therefore, incumbent upon this Court to consider the appellants' assertions of irregularity of the procedure and illegality of the franchise in light of appellants' previous position in the award process.

Appellants' prior conduct can only be characterized as full acquiescence in the bidding and award process they now challenge. Appellants' participation in the bidding and award process, guided consistently by competent legal counsel, was clearly aimed at securing the franchise, within the framework of the process they now challenge, for their proposed joint venture. It seems clear that it...