Source: https://law.justia.com/cases/california/supreme-court/2d/38/853.html
Timestamp: 2019-07-21 19:32:27
Document Index: 518952040

Matched Legal Cases: ['§ 1401', '§ 34200', '§ 34500', '§ 34240', '§ 1415', '§ 34510', '§ 34511', '§ 34512', '§ 34513', '§ 34514', '§ 34516', '§ 34518', '§ 34515', '§ 34519', '§ 34521', '§ 34310', '§ 34313', '§ 1415', '§ 34212', '§ 1410', '§ 34502']

Housing Authority v. City of L. A. :: :: Supreme Court of California Decisions :: California Case Law :: California Law :: US Law :: Justia
Justia › US Law › Case Law › California Case Law › Cal. 2d › Volume 38 › Housing Authority v. City of L. A.
The controversy arises by reason of certain action taken by the city council on December 26, 1951, whereby it purported to rescind the prior approval of a low-rent housing [38 Cal. 2d 857] project and to abrogate the cooperation agreement entered into in all respects in accordance with law. Subsequently the city refused to perform any of the terms or obligations of the agreement. The facts antecedent to that action are in substance the following:
On August 10, 1949, the application for reservation of urban low-rent public housing and for the preliminary loan was submitted to the public housing administration of the United States. On August 17, 1949, the application was accepted and a program reservation issued covering 10,000 dwelling units. A preliminary loan contract was entered into between [38 Cal. 2d 858] the housing authority and the federal administration on December 2, 1949. The same contracting parties signed annual contributions contracts on October 27, 1950, and November 7, 1950, providing for loans not in excess of $44,694,800 to assist in the development of the project. Advances to the housing authority under these instruments to date aggregate approximately $12,000,000 evidenced by notes outstanding and unpaid.
Under the cooperation agreement the city agreed to cooperate with the housing authority by vacating streets, roads, and alleys within the areas necessary in the development [38 Cal. 2d 859] of the project, to accept dedication of land for new streets and to zone or rezone areas as might be necessary in connection with development and construction.
On December 18, 1951, the District Court of Appeal, Second District, Division Three, affirmed the judgment for the defendants in Drake v. City of Los Angeles, fn. * ((Cal.App.) 238 P.2d 1062). On December 26, 1951, without receiving the awaited reports the council adopted the pending resolution by a vote of eight to seven. On the same day the petition herein was filed. On January 2, 1952, in a message to the council, the mayor recorded his disapproval of the action. [38 Cal. 2d 860]
The constitutional validity of the United States Housing Act of 1937 is recognized as settled. (City of Cleveland v. United States, 323 U.S. 329 [65 S. Ct. 280, 89 L. Ed. 274]; Housing Authority v. Superior Court (1950), 35 Cal. 2d 550, [38 Cal. 2d 861] 557 [219 P.2d 457].) No question arises as to the validity of the Housing Authorities Law or of the Cooperation Agreement Law. The constitutionality of those enactments has been determined by prior decisions of this court. (Housing Authority v. Dockweiler (1939), 14 Cal. 2d 437 [94 P.2d 794]; Kleiber v. City & County of San Francisco (1941), 18 Cal. 2d 718 [117 P.2d 657]; Housing Authority v. Superior Court, supra, 35 Cal. 2d 550.)
The federal slum clearance and low-rent housing act, designed to employ funds and credit of the United States to assist the several states and their political subdivisions in achieving the declared policy, was enacted in 1937. (Sept. 1, 1937, ch. 896, 50 Stats. 888; title 42 U.S.C.A. § 1401 et seq.) Our state Legislature meeting in extraordinary session in 1938 enacted the Housing Authorities Law (Stats. 1938 Ex. Sess. p. 9, as amended; now Health & Saf. Code, § 34200 et seq.), and the Housing Cooperation Law (Stats. 1938, Ex. Sess. p. 2, as amended, now Health & Saf. Code, § 34500 et seq.), in order to afford the means for utilizing the benefits available under the United States Housing Act of 1937 by receipt of federal loans for repayment through operation of completed projects. The Legislature found that there was in existence in this state insanitary and unsafe dwelling accommodations in which persons with low income were forced to reside; that the conditions caused increase and spread of disease and crime and were a menace to the health, safety and economic welfare of the state which could not be relieved through the operation of private industry; that the amelioration of such conditions and the use of public funds for the purpose was a governmental function of state concern; and that it was also in the public interest to have the act immediately effective to relieve the then existing unemployment emergency. [1] In the same year through action of the city council, the "Housing Authority of the City of Los Angeles" was organized to function as the creature, however, of the state legislative action. (Section 4 of the act, Health & Saf. Code, § 34240.) The housing authority was thereby created as a state agency, "a public body corporate and politic" and is not an agent of the city in which it functions. [2] Similarly the city under the Housing [38 Cal. 2d 862] Authorities Law is an agency of the state, functioning under state law to fulfill state purposes, and is not acting pursuant to its fundamental law to effect solely municipal objectives. (Housing Authority v. Superior Court, supra, 35 Cal. 2d 550, 558; Kleiber v. City & County of San Francisco, supra, 18 Cal. 2d 718, 724-725.) [3] Each functioning body, the city and the housing authority, is a separate body politic vested with specific duties and powers under the Housing Authorities Law and Housing Cooperation Law to effect a state objective. Neither is functioning independently of that state law. In pursuing the state objective each is governed by the state law and neither may exercise powers not vested or recognized by that law. The city and the housing authority function as administrative arms of the state in pursuing the state concern and effecting the legislative objective.
[5] In enacting the Housing Authorities Law and the Housing Cooperation Law the Legislature did not take from the city all power to act in connection with housing projects under the statute. The city was given discretionary power to determine initially the need for the housing authority to function and to give approval of a proposed project. The city was also vested with discretionary powers to be exercised pursuant to the cooperation agreement which is required under the federal act. (42 U.S.C.A. § 1415(7)(b).) But having taken the initial discretionary action to bring the housing authority into operation and having approved a project and entered into a cooperation agreement ,there was nothing left to be done by either contracting party but to perform administratively whatever was necessary to carry the agreement into effect. (Kleiber v. City & County of San Francisco, supra, 18 Cal. 2d 718, 724; Housing Authority v. [38 Cal. 2d 863] Superior Court, supra, 35 Cal. 2d 550, 558.) Thereafter the city may not refuse to cooperate and thereby decline to exercise its power to effect the completion of the project except as may be otherwise specifically provided by the statute under which it is operating.
Under section 34509 the city is also granted specified powers, such as to dedicate, sell, convey or lease any of its property to the housing authority or to the federal government (§ 34510); to furnish parks, playgrounds, recreational, community, educational, water, sewer, drainage facilities or other works (§ 34511); to furnish, dedicate, close, pave, install, grade, regrade, plan or replan streets, roads, roadways, alleys, [38 Cal. 2d 864] sidewalks or other places (§ 34512); to plan or replan, zone or rezone any part of the area, and make exceptions to building regulations and ordinances to that end (§ 34513); also to change its maps (§ 34514). The city may do all things necessary or convenient to aid and cooperate in the planning, undertaking, construction or operation of housing projects (§ 34516) and incur expenses thereof (§ 34518). It may enter into agreements with the housing authority or the federal government respecting the action so to be taken without any limitation on the duration of such agreements (§ 34515); also agreements with respect to the amounts the housing authority will pay for improvements, services and facilities to be furnished by the city for the benefit of the project (§ 34519). The exercise of the powers thus granted is authorized to be by resolution (§ 34521).
The housing authority is given powers and duties which avowedly are bestowed and imposed for the purpose of carrying to completion the housing projects initiated under the act. (See §§ 34310, 34311, 34312.) Until 1945 the city was not called upon to voice approval or disapproval of a proposed project. In that year (Stats. 1945, p. 1450, as amended 1951, pp. 1922, 1953; Health & Saf. Code, § 34313), in order to give the city an opportunity to reappraise the existing need, the Legislature enacted an exception to the exercise of the housing authority's powers by providing that where there did not exist on September 15, 1945 (the effective date of the enactment), contracts for financial assistance between a housing authority and the federal government, no low rent housing or slum clearance project should thereafter be developed, constructed or owned by a housing authority except after consultation with the school district in which the project was located, and until the city council approved it by resolution. The city approval and declarations under the statute also serve the federal act requirements for city approval and declarations of existing need prior to entering into federal contracts for preliminary loans and annual contributions. (Title 42 U.S.C.A., § 1415(7)(a)(b).) [6] The clause in section 34313 saving therefrom projects as to which contracts for financial assistance from the federal government had already been signed, is a plain recognition by the state Legislature that it had no power to enact laws which would interfere with the obligations of those contracts. Likewise it manifests a legislative intent that when a project has progressed to the point of contractual obligations with [38 Cal. 2d 865] the federal government, it should proceed to completion unless the signatory bodies have the power to withdraw from or modify the agreements. This recognition is controlling on the city and, in the absence of modifications of existing contracts by mutual consent of the signatory bodies or with legislative sanction, requires the city to proceed.
[8] A housing project under these acts is solely one to be financed in whole or in part by the federal government to meet the declared need for slum-clearance and low-rent housing construction (§ 34212). The time when the city might halt the project is before it has given the approval which authorizes the authority to proceed to make applications for [38 Cal. 2d 866] and procure the federal loans. When the declaration has been made, the project is approved, and is in the course of development and construction with the use of the borrowed funds, it is then too late for the city to withdraw except by express authority. As the provisions of the law hereinbefore referred to indicate, there is no inclusion of a power to proceed by abandonment or rescission. From that time the federal and the state acts contemplate completion of the statutory and contractual objectives. The city is given the power to prevent a project's being initiated, and no project under the state and federal law may be commenced or loans made without its approval and entry into a cooperation agreement. (42 U.S.C.A. §§ 1410, 1415(7) (a) (b).) It was obviously never assumed, and certainly it was not authorized by law, that after the city council had declared the need, had given requisite approvals of a project under state and federal law, and had undertaken binding commitments, it would or could repudiate them.
[10] The city also looks to a proviso in the Independent Offices Appropriation Act, 1952 (supra, Public Law, 137 [38 Cal. 2d 867] 82d Congress, 1st Sess., ch. 376, approved August 31, 1951). That proviso, after the date of its approval, prohibits authorization of the construction of projects initiated before or after March 1, 1949, in any locality in which such projects have been or may thereafter be rejected by the governing body of the locality or by the public vote, unless the projects have been subsequently approved by the same procedure through which the rejection was expressed. This proviso does not purport to grant a power to the city. It was dealing with the authority of the federal agency. As material here the proviso prohibits that agency's authorization of construction where the city had validly disapproved the project pursuant to state law. It does not purport to validate action of the city council which is invalid under state law. It is quite apparent that the local rejection referred to is that by which the city might withhold approval of the project. It deals with future action of the agency. It does not contemplate a case where, as here, the city has approved the project and the federal agency has authorized the construction. It does not give the agency power to rescind prior authorization of construction or repudiate the obligations incurred thereunder. This view is in accord with the opinion of the acting general counsel for the Public Housing Administration in a circular issued February 8, 1952.
The decisional law does not support the city's position. In Brooks v. City of Gilroy, 219 Cal. 766 [29 P.2d 212], abandonment [38 Cal. 2d 868] by the city of a contract for construction work and improvement was in the exercise of an express power and right under the act involved, which also made provision for payment of obligations incurred. It is assumed that the rescission of prior action may appropriately be accomplished by a municipal legislative body where rights of third persons have not intervened. The application of this recognized principle is to matters of municipal concern. (McConoughey v. Jackson, 101 Cal. 265 [35 P. 863].) Here the state law is controlling in a matter of state concern. Thereby the city is authorized to contract in respect to the granted powers, but it is also bound to compliance therewith accordingly. (Kleiber v. City & County of San Francisco, supra, 18 Cal. 2d 718, 724-725.) [11] As also shown in the Dockweiler case (Housing Authority v. Dockweiler, supra, 14 Cal.2d at pp. 456-457), with citation of McNulty v. Owens, 188 S.C. 377 [199 S.E. 425] (see, also, Rutherford v. City of Great Falls, 107 Mont. 512 [86 P.2d 656, 661]), the cooperation agreement is not an unauthorized attempt by the city to bind itself as to the exercise of governmental functions. It is simply an authorized contract to cooperate in the performance of those functions and as such is valid. [12] Thus control of city streets is a governmental function which the city without authority may not by contract prohibit or curtail. (Wills v. Los Angeles, 209 Cal. 448 [287 P. 962, 69 A.L.R. 1044]; see, also, Beals v. City of Los Angeles, 23 Cal. 2d 381, 386 [144 P.2d 839]; County of San Diego v. California Water & Tel. Co., 30 Cal. 2d 817, 822, 824 [186 P.2d 124, 175 A.L.R. 747].) But as pointed out the city is authorized under the state law to cooperate by contract with the housing authority in the exercise of the granted power to close city streets, and in doing so is acting pursuant to the statute in a matter of state concern. [13] In this as in the other respects the general principle applies that the state grant of the powers and the authority to execute and enter into the contract to exercise those powers contemplates performance of the contract and implies no authority to breach it. (California Highway Com. v. Riley, 192 Cal. 97, 107-108 [218 P. 579].) Likewise the statute provides the method for the exercise of those powers, including the power to close streets. There is no merit in the contention that certain other statutes supply a method. The city concedes that the state has the power to control the streets and to provide the exclusive methods for the vacation of streets. The state has exercised that power in relation to housing projects [38 Cal. 2d 869] in the Housing Authorities Law and the Housing Cooperation Law. [14] The provision of section 34512 that the city may furnish, dedicate, close, etc., streets "which it is otherwise empowered to undertake" does not alter this meaning. The same phrase appears in section 34511 with reference to the furnishing of parks, sanitary and other facilities. The powers conferred are "supplemental to the powers conferred by any other law." (§ 34502.) These specific powers were not powers which the city did not theretofore possess when exercising them in relation to local matters. The meaning therefore is clear that the powers conferred by the statute are not those same powers, but are specially granted as supplemental to the local powers. They are to be exercised pursuant to the act by the same local governing body which otherwise would operate in relation to matters primarily of local concern where constitutional rights of compensation for the taking or damaging of private property for use in the project are also observed.
In Times-Mirror Co. v. Superior Court, 3 Cal. 2d 309 [44 P.2d 547], the city of Los Angeles attempted to withdraw [38 Cal. 2d 870] from and abandon condemnation proceedings to acquire land and properties of the Times-Mirror Company for use in a contemplated civic center. In the meantime the Times-Mirror had constructed a building on another location. The writ of mandamus issued in effect to prevent abandonment by the city of the pending condemnation proceedings by directing the respondent court to proceed with the trial of the condemnation action. The issuance of the writ was indicated by the application even as against the public body of the equitable doctrine of estoppel. This court, citing City of Los Angeles v. Cohn, 101 Cal. 373, observed (at p. 330 [35 P. 1002]) that there are limits beyond which even a city in representing the rights of the public might not go. [15] That and the Cohn case constitute authority that the court is not bound by precedent in determining what facts and circumstances compel the issuance of the writ but that the writ will issue as against a city or other public body or officer wherever law and justice require such action. [16] The present matter involves more than equity and justice. As has been noted the statutory provisions impose the duty upon the city to perform the administrative acts contemplated by the state legislative action in a matter of state concern. The policy of that law is not a matter of judicial concern or control. Both the Congress of the United States and the Legislature of this state have provided for the cooperative effort evidenced by the contracts between the city and the housing authority. Each of these entities as governmental agencies of the state was authorized to enter into the contracts here sought to be enforced as a public duty on the part of the city.
In brief, the city's acts and contracts are binding in accord with the statutory purpose and objective; and no provision is indicated which permits the city's attempted cancellation, abandonment and abrogation of its contracts. As noted, the extent to which projects begun with the use of federal funds might be canceled or modified is covered by the provisions of the law as to amendments, modifications or supersedure of existing contracts for federal loans and contributions, none of which is here involved. If it be desirable to include provisions for cancellation by city action, as distinguished from withholding of city approval prior to initiation, the subject is one to be addressed to the respective federal and state legislative bodies for appropriate permissible enactments which would protect the rights of all interested parties. Without such enactment the unauthorized summary action by the city [38 Cal. 2d 871] amounts to a failure of recognition of that concert of federal and state action on which the city in fact relies.
FN 1. Any question of the due adoption of the ordinance because it was not first submitted to the city planning commission has been settled adversely to the contentions of the plaintiff taxpayers in Drake v. City of Los Angeles, filed concurrently herewith.
FN *. A hearing was granted by the Supreme Court on February 14, 1952. The final opinion of that court is reported, post, 872.
FN 2. The outcome makes it unnecessary to consider the contention of the petitioners that the city council's approval, having been given by ordinance (although resolution only was required), the purported rescission by resolution was invalid.