City of Los Angeles v. Offner

GIBSON, C. J. —

By this proceeding in mandamus the city of Los Angeles seeks to compel the respondent, as secretary of its board of public works, to post and publish notices inviting sealed bids for the construction and leasing to the city of a rubbish incinerator. The respondent demurred to the petition, contending that the proposed lease will create a municipal indebtedness or liability which will exceed in the year of its execution the income and revenue then available to the city in violation of article XI, section 18, of the state Constitution.

The Board of Public Works of the City of Los Angeles by resolution has adopted specifications for the construction and leasing to the city of a rubbish incinerator, and for the receipt of bids therefor. The agreements to be entered into between the city and the successful bidder are to provide for the leasing by the city to such bidder of certain city-owned property for a period of ten years at a rental of $1 a month, it being contemplated that the contractor will construct the incinerator on the property within nine months thereafter. Simultaneously with the execution of this lease and construction contract, the successful bidder is to execute a lease to the city of the demised premises with the incinerator thereon for a period of nine years and nine months, the city to pay a monthly rental to be specified in the bid. The city is to be given an option to purchase the incinerator at various intervals during the term of the lease with a minimum option price for each interval being specified by the bidder. If the city elects to purchase, the option price shall be the then appraised

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value of the incinerator as determined by three independent appraisers, provided only that it shall not be lower than the minimum price specified in the bid. Title to the incinerator is to remain in the successful bidder unless the city elects to purchase. The land lease from the city is to run for a period of three months after the expiration of the incinerator lease and option agreement from the successful bidder to the city, thus affording the bidder time within which to remove the incinerator, a right expressly reserved to him in the event the city elects not to exercise the option to purchase.

It is alleged in the petition “that the present rubbish incinerator facilities of petitioner City are inadequate and obsolete, and constitute a fire hazard, and that the public health and safety demand the immediate construction of a large, modern rubbish incinerator. ’ ’