269 P.3d 1017
Wash.2012Background
- Tacoma has franchise agreements with the Municipalities to provide a water system, including hydrants.
- TPU paid hydrant costs via ratepayers and later changed billing after Lane.
- Tacoma filed a declaratory judgment action challenging hydrant-cost allocation; the Municipalities opposed.
- The trial court ruled hydrants were covered by the franchise agreements, and indemnification precluded the suit and required Tacoma to defend Federal Way.
- The opinion holds hydrants are within the franchise agreements and Tacoma bears hydrant costs; indemnification does not preclude suit or require defense of Federal Way.
- Lane’s import and the discovery of a charging scheme are discussed; the Uniform Declaratory Judgments Act is deemed satisfied; attorney-fee issues addressed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Do franchise agreements require Tacoma to provide and maintain hydrants? | Tacoma: hydrants not expressly mentioned; not required. | Municipalities: hydrants included in water system; implied obligation. | Yes; hydrants must be provided and maintained, and costs borne by Tacoma. |
| Do indemnification provisions preclude this action and must Tacoma defend Federal Way? | Municipalities: broad indemnification bars suit and defense not required. | Tacoma: indemnification can preclude or require defense. | Indemnification does not preclude the action; Tacoma not required to defend Federal Way. |
| Is Lane applicable to this case's hydrant-cost question? | Tacoma: Lane controls hydrant-cost treatment. | Municipalities: Lane governs ratepayer taxes/fees distinctions. | Lane does not control a blanket hydrant-charge ruling here. |
| Was the Uniform Declaratory Judgments Act satisfied? | Greyhound requires more issues addressed. | Trial court addressed merits; JDJ Act satisfied. | Yes; trial court properly decided on the merits. |
| Is Tacoma entitled to attorney fees? | Tacoma seeks fees under defense duty provisions. | Based on holdings, no duty to defend exists. | No attorney fees awarded to Tacoma related to the duty-to-defend claim. |
Key Cases Cited
- Lane v. City of Seattle, 164 Wn.2d 875 (Wash. 2008) ( hydrant charges may be taxes or fees depending on levy; SPU and Lake Forest Park distinctions)
- Covell v. City of Seattle, 127 Wn.2d 874 (Wash. 1995) ( hydrant-fee vs. tax analysis framework)
- Greyhound Corp. v. Division 1384 of Amalgamated Ass’n of Street, Electric Railway & Motor Coach Employees of America, 44 Wn.2d 808 (Wash. 1954) (precludes dismissal with prejudice without declaring rights; merits-based)
- Burns v. City of Seattle, 161 Wn.2d 129 (Wash. 2007) (governmental vs proprietary function; framework for contract interpretation)
- City of Tacoma v. Taxpayers of Tacoma, 108 Wn.2d 679 (Wash. 1987) (contract interpretation of municipal actions; proprietary analyses)