Unite Here Local 30 v. Department of Parks & Recreation
123 Cal. Rptr. 3d 789
Cal. Ct. App.2011Background
- DPR awarded a 10-year concession contract at Old Town San Diego State Historic Park to Delaware North (DNCPR and DNCPRSD) after competitive bidding in 2004.
- In late 2008, DPR approved Delaware North’s assignment of the Concession Contract to Old Town Family Hospitality Corp. (OTFHC) for the remaining term.
- As a result, many Delaware North employees on the concession were terminated or not rehired by OTFHC; Local 30 ceased representing those employees.
- Bridgette Browning (California resident and taxpayer) and Unite Here Local 30 sued DPR to overturn the assignment, asserting violations of the Public Resources Code bidding requirements and the contract’s assignment clause.
- The trial court sustained a demurrer to the contract claim for lack of standing and rejected the Public Resources Code claim, holding the assignment did not cause a material contract change or require competitive bidding; the action proceeded on the latter claim only.
- The court ultimately affirmed judgment, concluding the assignment did not legally trigger Article 1 competitive bidding requirements and that plaintiffs lacked standing as third-party beneficiaries.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the assignment required competitive bidding | Browning argues all concession contracts fall under Article 1 and assignment is a material change | DPR examined assignee qualifications; not all amendments trigger Article 1 | No; assignment did not materially change terms and did not trigger Article 1. |
| Whether OTFHC’s qualification as best bidder/proposer matters for Article 1 | Assignee’s identity as new concessionaire is a material change requiring bidding | OTFHC qualified and assignment caused no material change; Article 1 may not apply | OTFHC qualified as best bidder/proposer; no material change necessitating Article 1 bidding. |
| Whether plaintiffs have standing as third-party beneficiaries to enforce the contract | Residents/taxpayers and Local 30 are intended beneficiaries via Article 1 and the contract clauses | No explicit class; benefits incidental; no standing under Civil Code 1559 | Plaintiffs lack standing as third-party beneficiaries; no enforceable contract claim. |
Key Cases Cited
- Beck Development Co. v. Southern Pacific Transportation Co., 44 Cal.App.4th 1160 (Cal.App.4th 1996) (standard for substantial evidence review in contract modifications)
- Ghirardo v. Antonioli, 8 Cal.4th 791 (Cal. 1994) (statutory construction; de novo review for questions of law)
- Brown v. Kelly Broadcasting Co., 48 Cal.3d 711 (Cal. 1989) (interpretation of statutory terms; legislative intent)
- Trope v. Katz, 11 Cal.4th 274 (Cal. 1995) (statutory interpretation; whole-system approach)
- Martinez v. Socoma Companies, Inc., 11 Cal.3d 394 (Cal. 1974) (third-party beneficiary classification; creditor/donee)
- Amaral v. Cintas Corp. No. 2, 163 Cal.App.4th 1157 (Cal.App.4th 2008) (living wage contract as potential third-party benefit)
- Knipe v. Barkdull, 222 Cal.App.2d 547 (Cal.App.2d 1963) (personal services contract; assignment limits)
- Marshall v. Pasadena Unified School Dist., 119 Cal.App.4th 1241 (Cal.App.4th 2004) (emergency exception; strict reading of bidding policy)
- Shell v. Schmidt, 126 Cal.App.2d 279 (Cal.App.2d 1954) (historical authorities on public contracts)