Laidlaw Waste Systems, Inc. v. Bay Cities Services, Inc.

In this appeal we are asked to decide whether school districts within the City of Chula Vista (the City) are bound to honor an exclusive franchise for trash hauling awarded by the City to plaintiff Laid-law Waste Systems, Inc. (Laidlaw). We conclude the school districts, as state agencies, are immune from the City’s trash collection regulations and are therefore free to independently contract with other trash haulers pursuant to the competitive bidding provisions of Public Contract Code section 20111.

Factual and Procedural Background

Laidlaw and defendant Bay Cities Services, Inc. (Bay Cities) submitted the issue presented in this appeal to the trial court for decision based on stipulated facts, including the following.

The City is a “chartered” city within the meaning of California Constitution article XI, and is authorized to make and enforce all laws with respect to municipal affairs subject only to the express limitations contained it its charter.

In August 1982, the City awarded Laidlaw an exclusive franchise for hauling trash in the City. The Chula Vista Elementary School District has 25 locations and the Sweetwater Union High School District (Sweetwater) has…