Saathoff v. City of San Diego, D019329

• Decision Date: 31 May 1995
• Docket Number: No. D019329,D019329
• Citation: 41 Cal.Rptr.2d 352,35 Cal.App.4th 697
• Court: California Court of Appeals Court of Appeals
• Parties: Ronald L. SAATHOFF, Plaintiff and Appellant, v. CITY OF SAN DIEGO et al., Defendants and Respondents, AMERICAN MEDICAL SERVICES, Real Party in Interest and Respondent.

Page 352

41 Cal.Rptr.2d 352

35 Cal.App.4th 697

Ronald L. SAATHOFF, Plaintiff and Appellant, v. CITY OF SAN DIEGO et al., Defendants and Respondents AMERICAN MEDICAL SERVICES, Real Party in Interest and Respondent.

No. D019329.

Court of Appeal, Fourth District, Division 1, California.

May 31, 1995.

[35 Cal.App.4th 698] Fogel, Feldman, Ostrov, Ringler & Klevens, Joel N. Klevens and Mia Darbonne

Farber, Santa Monica, for plaintiff and appellant

John W. Witt, City Atty., and C. Alan Sumption, Chief Deputy City Atty., for defendants and respondents.

Peterson & Price, Paul A. Peterson and Larry N. Murnane, San Diego, for real party in interest and respondent.

HUFFMAN, Associate Justice.

Ronald L. Saathoff appeals from a judgment in favor of the City of San Diego et al., (hereafter the "City" or "City Council") arising from the trial court's denial of his petition for writ of mandate. Saathoff asserted in his writ of mandate petition that the City Council's passage of a resolution based on a majority vote, awarding a paramedic system management contract to American Medical Services (hereafter "American"), constituted a franchise which required enactment of an ordinance based on a two-thirds vote. Given the relatively short-term four-year duration of the contract and the impermanent nature of the possessory use of public property, we hold the contract need not be deemed a franchise as a matter of law so as to invalidate the otherwise lawful exercise of governmental authority.

FACTUAL AND PROCEDURAL BACKGROUND

In October 1992, the City Council approved the release of a "request for proposals" for paramedic system management. A notice of the procurement process was sent to 43 ambulance companies; in November 1992 the bidders made comments and asked questions at a bidders' conference; and bids were accepted until December 1992. The timely bidders included Hartson Medical Services, the San Diego Fire Department, and American. The bids were reviewed by a proposal evaluation committee, a board of fiscal advisors, and the city manager, and recommendations were made to the City Council. In February 1993, after public hearings regarding the proposals, the City Council adopted a resolution authorizing the award of the paramedic system management contract to American.

The agreement between the City and American runs for four years (July 1993-June 1997) and provides that American will respond to all requests for emergency medical services (for both basic life services and advanced life services) ¹ received in the 911 medical dispatch center. Under the agreement, American uses the City's ambulances and support vehicles and certain other emergency equipment, houses paramedics at some fire stations, and operates the 911 communications center at the City's fire department, utilizing the City's major communications and computer equipment. The agreement is not assignable without written consent of the City (except for billing and collection and certain areas of equipment maintenance). Termination of the agreement could arise from a failure to comply with material provisions or the occurrence of certain events.

Prior paramedic system contracts to respond to 911 calls awarded by the city lasted for two-year or four-year periods. ² These contracts, like the current American contract, were awarded by means of City Council resolutions.

The City Council's passage of the resolution awarding the paramedic contract to American was accomplished by a vote of five in favor and four opposed, which did not constitute the two-thirds vote required under the City's charter for the granting of a franchise.

In his writ of mandate petition, Saathoff ³ alleged the contract constituted the award of a franchise which required an ordinance adopted by two-thirds of the City Council. Denying the writ, the trial court determined the contract was not a franchise.

ANALYSIS

The parties dispute whether the standard on appeal in this case should be our independent review of a question of law or the substantial evidence test involving deference to the trial court's judgment. In reviewing the trial court's ruling on a writ of mandate (Code Civ.Proc., § 1085), the appellate court is ordinarily confined to an inquiry as to whether the findings and judgment of the trial court are supported by substantial evidence. (Rodriguez v. Solis (1991) 1 Cal.App.4th 495, 502, 2 Cal.Rptr.2d 50.) However, the appellate court may make its own determination when the case involves resolution of questions of law where the facts are undisputed. (Ibid.)

Here, the pertinent facts are essentially undisputed. However, as we shall explain, the resolution of whether a franchise was created in this case requires the drawing of inferences from the presented facts, i.e., to determine whether the paramedic agreement carries the indicia of a franchise to such an extent as to compel the city to create a franchise rather than a mere contract. Accordingly, since we are not presented purely with a question of law, we shall apply the substantial evidence test and give deference to the inferences in support of a finding that the agreement need not be deemed a franchise as a matter of law. (See Atlantic Richfield Co. v. State of California (1989) 214 Cal.App.3d 533, 538, 262 Cal.Rptr. 683.) We note, however, that even if we were exercising our independent judgment on the undisputed facts, we would reach the same conclusion as did the trial court.

The Charter of the City of San Diego, section 103, states: "FRANCHISES. [p] The Council shall have power to grant to any person, firm or corporation, franchises, and all renewals, extensions and amendments thereof, for the use of any public property under the jurisdiction of the City. Such grants shall be made by ordinance adopted by vote of two-thirds ( 2/3) of the members of the Council and only after recommendations thereon have been made by the Manager and an opportunity for free and open competition and for public hearings have been given. No ordinance granting a franchise or a renewal, extension or amendment of an existing franchise shall be effective until thirty days after its passage, during which time it shall be subject to the referendum provisions of this Charter. No franchises shall be transferable except with the approval of the Council expressed by ordinance."

Section 103.1 of the Charter similarly requires an ordinance for the establishment of works which supply public utilities or businesses which furnish services of a public utility nature. ⁴ Section 105 of the Charter states that the City has plenary control "over all primary and secondary uses of its streets and other public places," the City may grant franchises, and the grantee of a franchise shall pay compensation to the City as consideration of the grant. ⁵

The Charter does not specifically define what constitutes the granting of a franchise. ⁶ The issue before us is whether the paramedic contract must be deemed a franchise as a matter of law, thereby invalidating the City's otherwise lawful exercise of its governmental authority through the passage of a resolution.

Mandamus is available to compel a governmental body to exercise its discretion under a proper interpretation of the applicable law. (Common Cause v. Board of Supervisors (1989) 49 Cal.3d 432, 442, 261 Cal.Rptr. 574, 777 P.2d 610.) However, mandamus is not available to compel a governmental body to exercise its discretion in a particular manner. (Ibid.) Thus, unless the instant agreement must be deemed a franchise as a matter of law, we cannot compel the City to so characterize it. Accordingly, we evaluate the degree to which this particular contract carries the indicia of a franchise. Since the evaluation involves a restraint on the government's choice of the manner in which it chooses to exercise its authority, the less the contract is imbued with the characteristics of a franchise, the more restrained the court should be in so restricting the otherwise lawful performance of governmental functions.

Although we are not faced with the issue as to whether the City could lawfully create a 911 ambulance service franchise if it chose to do so, we nevertheless make a threshold evaluation whether such a service might be the proper subject of a franchise. ⁷ Initially, we take a brief look at how some courts have evaluated a government's exercise of its police power to contract with a private party to provide public services.

In Copt-Air v. City of San Diego (1971) 15 Cal.App.3d 984, 988-989, 93 Cal.Rptr. 649, the court noted that a contract between a governmental body and a private party which creates a franchise "ordinarily refers to such services and functions as government itself is obligated to furnish to its citizens and usually concerns such matters of vital public interest as water, gas, electricity or telephone services, and the right to use the public streets and ways to bring them to the general public." Although franchises pertain to vital public services, when presented with an attack on a government contract delegating to a private party the performance of a vital public service, such as garbage collection, the courts have not necessarily deemed the contract a franchise. For example, in Ponti v. Burastero (1952) 112 Cal.App.2d 846, 852, 247 P.2d 597, the court held that an exclusive 25-year contract to handle a city's garbage was merely the exercise of governmental police power, and was not a franchise subject to the charter provisions governing the method of awarding franchises. ⁸ In support of its holding, Ponti quotes several sources, which include statements that a city has the right under its police power to handle garbage itself, or to decide to have the service performed under a contract, and that franchise provisions are applicable only to specifically-named public utilities, or utilities of a similar nature. (Id. at pp. 852-853, 247 P.2d 597.)

The same conclusion, pertaining to a...