Court Opinion

ID: 9670358
Source: CourtListenerOpinion
Date Created: 2023-08-24 03:19:23.782572+00
Date Added: 2024-06-11T18:16:04.057119
License: Public Domain

SABERS, Justice
(dissenting).
Blue Fox Bar did not receive a fair trial because the trial court dismissed the breach-of-contract claim against the City of Yankton.
The trial court erred in dismissing the breach-of-contract claim where the City’s director of public works Eugene Hoag testified to the existence of a contractual agreement, including specific water and sewer rates.
Q. (By Plaintiff’s Counsel) ... At that time in 1984 the Super-8 was outside the city limits of Yankton; is that correct?
A. Yes, that’s correct.
Q. And that was under a contractual agreement with the Super-8, since they were outside the city limits the Superb paid a double water rate based on gallonage, or paid twice as much for the gallonage as somebody in town would?
*922A. Yes. The water rate was based on double what it would have been had they been inside the city limits.
Q. And that was so that the City would recover the funds that it had put into extending service beyond the city limits; is that correct?
A. Yes. Everyone that has a contract with the City for being outside the City pays double water rates; a policy of the City Commission.
Q. And it was the City Commission that entered into that agreement?
A. Yes it was.
Q. And that included sewer services; correct?
A. The sewer rates were the same as a customer inside the city limits, because everyone on the sewer system has to be the same rate. Just the water was the double rate.
Q. But the agreement was to provide sewer and water services?
A. Yes it was.
The above testimony clearly shows proof of a contract. As appropriately stated by plaintiffs counsel,
“Four to six inches of raw sewage represents the breach, and the damages were clearly foreseeable. This Court, nor any court, can equitably justify a municipality entering into agreements, reaping the benefits and avoiding the burdens.”
Citing State Board of Education v. City of Ypsilanti, 350 Mich. 5, 85 N.W.2d 94 (1957); Bleick v. City of Papillion, 219 Neb. 575, 365 N.W.2d 405 (1985); Trimont Land Co. v. Truckee Sanitary Dist., 145 Cal.App.3d 330, 193 Cal.Rptr. 568 (3d Dist. 1983). Although factually distinguishable these cases recognized that “agreements” with political subdivisions must contain burdens along with benefits for the political subdivision.
The reliance of the majority opinion on Ericksen v. City of Sioux Falls, 70 S.D. 40, 14 N.W.2d 89 (1944), is somewhat misplaced. Plaintiffs counsel argues that as applied to this case Ericksen is inherently wrong and against public policy. He also distinguishes Ericksen because it turns on the issue of the health and welfare of the residents, who could have been denied proper services in order to fulfill the contract with Morrells (because of lack of capacity to provide services to both). Additionally, he argues Ericksen differs from the present case because capacity is not at issue. The instant case does not turn upon police powers or contracting away control, but involves only the safety and well-being of the contracting party and its customers.
The majority opinion holds that:
SDCL 9-48-32 merely gives a city the right to allow a party to use the sewer system at a stated rate. Here, the City Commission’s ratification of an agreement to allow the Super-8 to hook up to the sewer line at a specified rate created no duties, rights or obligations on either party.
To hold that no duties, rights or obligations on either party were created even appears inconsistent with the statement in the majority opinion: “... by undertaking the construction and maintenance of a sewer system, the City acted in a proprietary capacity, and therefore, may be held liable in tort for "wrongs committed in its exercise of this function.” If the City is liable to its customers for negligence, I fail to see why it cannot be liable to its customers for breach of contract.
SDCL 9-48-32 provides:
A municipality wherein a sewage treatment or septic plant is maintained shall have power to contract for the privilege of connecting to said plant for the purpose of treating or disposing of private sewage or industrial waste originating within the municipality or within one mile of the corporate limits, provided said plant has capacity over the requirements of the municipality for handling such sewage or industrial waste, (emphasis added)
The statute itself refers to and eliminates the argument over capacity. Despite that, *923the majority opinion concludes that the “‘power to contract’ language in SDCL 9-48-32 is clearly qualified by the phrase which immediately follows, ‘for the privilege of connecting.’ ” Unlike the majority I find nothing within the statute, which statute did not apply to Ericksen, to preclude a breach-of-contract claim. If the legislature so intended, it would have been a simple matter to expressly provide that no liability shall result from any breach of said contract.
Accordingly, I respectfully submit that Blue Fox Bar did not receive a fair trial for this reason.