Aztec Engineering California, Inc. v. City of South Pasadena, Second District Court of Appeal Case No. B221034, 2010 Cal. App. Unpub. LEXIS 6360
Jones & Mayer successfully defended the City of South Pasadena in an action which attempted to enforce an impermissible oral modification to a construction contract. Aztec Engineering California, Inc., sued the City of South Pasadena when it did additional work on design work for the Fair Oaks/SR-110 project at the oral direction of City staff but without approval of a written contract amendment by the City Council. Aztec asserted various tort and quasi-contract claims against the City, based upon alleged assurances it had received from staff for payment on additional work and based upon attempts Aztec and City staff made to try to obtain compensation for Aztec through a construction contract with another entity, since there were no longer any CalTrans funds available for design of the project.
Jones & Mayer, attorneys Kimberly Hall Barlow and Krista MacNevin Jee successfully defended the City on the basis that Aztec had not obtained the proper, official authorization from the City to proceed with the work. Attorneys Barlow and Jee demurred three times to three versions of Aztec’s complaints and the trial court granted each demurrer, finally deciding that Aztec could not state any claim against the City. Aztec appealed the dismissal of its case. The Second District Court of Appeal upheld the trial court’s decision in an unpublished opinion on August 9, 2010.
The Court of Appeal affirmed that there was no evidence any City employees had any fraudulent intent in their communications with Aztec and that the City is immune from any liability associated with any asserted misrepresentations made to Aztec by City employees about payment for the additional services provided by Aztec. Further, the Court’s opinion supported the City’s primary claim that a contract amendment not made in accordance with modification requirements in the contract itself or as required by law for formal approval of a contract by the City Council is null and void. The case was a complete victory for the City of South Pasadena and supports the long-held notion that only formal, official city council action can contractually bind a city.