South Bay Senior Housing Corp. v. City of Hawthorne

In the published portion of this opinion, we hold that when a statute limits a general law city’s power to make a certain kind of contract to a certain prescribed method, thereby implicitly prohibiting other methods of contracting, a contract that does not conform to the prescribed method is void and the city cannot be liable on an implied contract theory for the benefits it received or the damage it caused to the other party to the void contract. In the unpublished portion of this opinion, we hold that substantial evidence supports the jury’s finding that the contract at issue was signed as required by law. We affirm the jury’s determination of liability, reverse the award of damages, and remand with directions.

Facts

South Bay Senior Housing Corporation, a developer of low-income senior citizen housing, contacted the City Manager of the City of Hawthorne to express interest in a certain City-owned parcel of land for the construction of a new senior citizen facility. When South Bay’s president (Irving Sokolsky, M.D.) was told that a deed restriction precluded a sale but that the property was available for lease, Sokolsky said he was still interested, and he was later…