Stinson v. City of Craig, CO ( 1999 )

F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
DEC 23 1999
FOR THE TENTH CIRCUIT
PATRICK FISHER
Clerk
GLEN E. STINSON, individually and
as TRUSTEE FOR GLEN E.
STINSON PENSION AND PROFIT
SHARING PLAN and GLEN E.
STINSON, P.C., No. 98-1354
(D.C. No. 97-M-2388)
Plaintiffs-Appellants, (D. Colo.)
v.
CITY OF CRAIG, COLORADO,
Defendant-Appellee.
ORDER AND JUDGMENT *
Before ANDERSON and KELLY , Circuit Judges, and BROWN , ** Senior
District Judge.
*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
**
Honorable Wesley E. Brown, Senior District Judge, United States District
Court for the District of Kansas, sitting by designation.
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
In July 1997, Glen Stinson, a resident of Georgia, and his Georgia
corporation (collectively, “Stinson”) entered into a contract to purchase from the
City of Craig (“City”) approximately 500 acres of property located in Routt
County, Colorado. The City later contended that the contract was void and
refused to close on the sale. Stinson then filed suit, alleging the City had
breached the contract and seeking a declaratory judgment, specific performance,
consequential damages, and injunctive relief. After hearing argument on the
parties’ cross-motions for summary judgment, the district court ruled in favor of
the City. The district court concluded that the contract was void because the city
council was required by state law to pass an ordinance approving the sale, and it
did not do so. Therefore, the court ordered the City to return Stinson’s earnest
money, with interest. Stinson now appeals. We exercise jurisdiction over this
appeal under 28 U.S.C. § 1291 and reverse and remand for further proceedings.
The City of Craig is a home rule city and, as such, derives its powers over
local matters from Article XX, § 6 of the Colorado Constitution, not from the
General Assembly. See Burks v. City of Lafayette , 349 P.2d 692, 696 (Colo.
-2-
1960) (en banc). “[A]dopted by the voters in 1912, [Article XX, § 6] granted
‘home rule’ to municipalities opting to operate under its provisions and thereby
altered the basic relationship of such municipalities to the state.” City & County
of Denver v. State , 788 P.2d 764, 766 (Colo. 1990) (en banc). “In effect, the
amendment vested home rule municipalities with their own sphere of sovereignty,
providing them with every power theretofore possessed by the legislature to
authorize municipalities to function in local and municipal affairs.” U.S. West
Communications, Inc. v. City of Longmont , 948 P.2d 509, 517 (Colo. 1997) (en
banc) (citation and quotation omitted). “[T]he home rule city has the power to
adopt its own charter and can within its sphere exercise as much legislative power
as the Legislature . . . .” Burks , 349 P.2d at 695. Statutory cities, on the other
hand, “possess only such powers as are expressly conferred by statutory grant or
exist by necessary implication.” City of Sheridan v. City of Englewood , 609 P.2d
108, 109 (Colo. 1980) (en banc).
At issue here is the effect of Colo. Rev. Stat. § 31-15-713(1)(b), which
provides that “[t]he governing body of each municipality has the power . . . [t]o
sell and dispose of, by ordinance, any . . . real estate [not used or held for any
governmental purpose].” The parties do not dispute that the sale of municipal
property is a matter of local concern. Cf. Colo. Const., Art. XX, § 1 (creating the
City and County of Denver as a home rule city and providing, among other things,
-3-
that it “may purchase, receive, hold, and enjoy or sell and disposed of, real and
personal property”). Although the General Assembly may legislate in matters of
local concern, “when a home rule ordinance or charter provision and a state
statute conflict with respect to a local matter, the home rule provision supercedes
the conflicting state provision.” City & County of Denver , 788 P.2d at 767.
Where not superceded by a conflicting charter or ordinance, however, the state’s
statutes apply to home rule cities. See Colo. Const., Art. XX, § 6.
Although the statute’s use of the term “municipality” includes home rule
cities, see Colo. Rev. Stat. § 31-1-102(1), whether the statute was intended to
limit a home rule city’s ability to sell real property is not clear from the statutory
scheme. See id. (stating that “use of the term ‘municipality’ . . . shall not in and
of itself create a presumption for or against preemption of home rule . . .
powers”); id. § 31-15-104 (“The enumeration of powers set forth in this title shall
not be construed to limit the exercise of any other power granted to municipalities
by the provisions of any other law of this state.”). Nor have we found any cases
from the Colorado courts discussing the effect of § 31-15-713 on home rule cities.
Proceeding from the general principle that state statutes apply to home rule
cities in the absence of conflicting charter provisions or ordinances, the City
argues that by granting the power to sell municipal property only by ordinance,
§ 31-15-713(1)(b) prohibits a city from selling real estate by other means. The
-4-
City further argues that this prohibition does not conflict with any charter
provision or ordinance adopted by the City. Therefore, the City contends that it
could not sell the subject property to Stinson without passing an ordinance
approving the sale and, in the absence of such an ordinance, the contract for sale
was void.
Stinson argues that the statute does not limit the City’s power to sell real
estate, based on three alternative theories. First, he contends that the statute is
only an enabling statute, and its grant of power to sell real property by ordinance
does not prohibit the sale of real property by other means. Second, he contends
that even if the grant of power in the statute carries with it a limitation on the
exercise of that power, the limitation applies only to cities that derive their power
from the General Assembly. Because the City derives its power to sell real estate
from the Colorado Constitution and its own charter, any limitation in the statute
does not apply to the City. Finally, Stinson argues that if the statute does purport
to limit the City’s power to sell real estate, the statute is superceded by
conflicting provisions in the City’s charter.
We find support for Stinson’s position in Colorado’s case law. For
instance, in Schaefer v. City & County of Denver , 973 P.2d 717, 719 (Colo. Ct.
App. 1998), cert. denied , (Colo. Apr. 12, 1999), the court considered whether
language in Colo. Rev. Stat. § 10-7-203 granting municipalities the power to
-5-
provide life, health, or accident insurance as a benefit for their employees limited
the ability of Denver, a home rule city, to extend insurance coverage to “spousal
equivalents” of its employees. The court concluded that “[w]hile other entities
listed in the statute may require statutory authority to offer group insurance as an
employee benefit, home rule cities derive that power from Article XX, Section 6
of the Constitution . . . .” Id. at 720. Because “home rule cities in Colorado need
not rely on § 10-7-203 for authority to purchase and offer group health insurance
policies as employee benefits,” the court concluded that the statute did not
“limit[], or intend[] to limit, the power of a home rule city to design and
implement group health programs for its employees.” Id; see also Burks , 349
P.2d at 697 (concluding that statute granting cities the power to limit referendum
on an ordinance by invoking the safety clause did not apply to home rule city
because it derived its powers over local matters from the Colorado Constitution,
not from the General Assembly).
Here, the City’s charter grants it the power to “purchase, receive, hold and
enjoy, or sell and dispose of, real and personal property.” Plaintiffs/Appellants’
Fed. R. App. P. 28(f) Legal Authority Pamphlet (“Pamphlet”), Tab C, at C-1,
§ (2)(b). Therefore, the City had the power to sell the subject property even in
the absence of the grant of power by § 31-15-713(b)(1). Pursuant to the Schaefer
court’s rationale, even if we adopt the district court’s interpretation of
-6-
§ 31-15-713(b)(1) as granting only a limited power to sell real estate, that
limitation would not apply to the City, because the City does not derive its power
from the statute.
Moreover, even if we interpret § 31-15-713(b)(1) as intending to limit the
power of home rule cities to sell municipal real estate, we agree with Stinson that
the statute conflicts with the powers granted by the City’s charter and, therefore,
is superceded by the charter. Although the City’s charter does not contain a
specific provision concerning the means by which municipal real property may be
sold, its general provisions speak to the matter. Thus, the charter vests “[a]ll
powers of the City” with the city council, except where otherwise provided,
including the power to sell and dispose of real property. Pamphlet, Tab C, at C-2,
§ 5; C-1, § (2)(b). The charter provides that the city council may exercise certain
powers only by ordinance, see id. at C-2, § 5(a), and otherwise provides that the
city council “shall act by ordinance, resolution or motion,” id. at C-4, § 12(a).
The power to sell real property is not among those that may be exercised only by
ordinance. Applying the familiar canon of statutory construction 1
“expressio
unius est exclusio alterius”--the expression of one thing implies the exclusion of
1
“Rules of statutory construction apply to municipal charters and ordinances
as well as to statutes.” Cherry Creek Aviation, Inc. v. City of Steamboat Springs ,
958 P.2d 515, 519 (Colo. Ct. App. 1998).
-7-
the other--we conclude the charter grants the City the power to sell real estate by
ordinance, resolution, or motion.
In determining whether a local charter or ordinance conflicts with a state
statute, the essential inquiry is whether the charter or ordinance authorizes what
the statute forbids or forbids what the statute expressly authorizes. See, e.g., City
of Aurora v. Martin , 507 P.2d 868, 869-70 (Colo. 1973) (en banc). If we interpret
the statute’s grant of power to sell real property by ordinance as intending no
limitation on a home rule city’s power to sell real property by other means, then
the statute is not in conflict with the City’s charter and the two can co-exist. If,
however, we interpret the statute’s grant of the power to sell real property by
ordinance as impliedly forbidding the sale of real property by other means, then
the statute conflicts with the City’s charter. In the event of a conflict between the
statute and the charter on this matter of local concern, the charter prevails. Thus,
under either interpretation of the statute, the City maintains the power to sell real
property by ordinance, resolution, or motion until the people of the City of Craig
choose to change the charter.
Having concluded that the statute does not require the City to sell real
property by ordinance only, we conclude that the contract between Stinson and the
City is not void for lack of an ordinance approving it. Stinson has steadfastly
maintained that the motion passed by the city council accepting his bid on the
-8-
subject property constituted a motion approving the sale, and the City has never
disputed this contention. Therefore, we conclude the district court erred in ruling
the contract void and unenforceable. Because the district court concluded the
contract was void, it did not consider whether the City was in breach of the
contract, or to what relief Stinson may be entitled as a result. These remaining
issues should be resolved on remand.
The judgment of the United States District Court for the District of
Colorado is REVERSED, and the case is REMANDED for further proceedings in
light of this order and judgment.
Entered for the Court
Stephen H. Anderson
Circuit Judge
-9-