Coliseum Square Ass'n v. City of New Orleans - 544 So. 2d 351 (La. 1989)

Rule:

Under New Orleans, La., Home Rule Charter § 3-112(5)(d), the New Orleans City Council is empowered to adopt proposed ordinances alienating any immovable property and granting any servitude, franchise or privilege. Specifically, New Orleans, La., Home Rule Charter § 6-307(4) authorizes the leasing of public property and provides that contracts for the leasing of property belonging to the city for periods of more than one year shall be subject to requirements which may be imposed by ordinance.

Facts:

Trinity Church, a Louisiana non-profit corporation, sought to purchase the 2100 block of Chestnut Street from the City of New Orleans. In November of 1986, the New Orleans City Council passed a resolution asking the City Planning Commission to hold a public hearing on the proposed purchase. The City Planning Commission recommended that the 2100 block of Chestnut Street be leased to Trinity under certain conditions. The Council proposed an ordinance to authorize to City to enter into a contract of lease with Trinity for a term of sixty years. After a hearing, the Council adopted Ordinance No. 11,776 authorizing the lease. Subsequently, the Coliseum Square Association and Magazine Street Business Association, non-profit corporations, and several residents of the neighborhood against the City of New Orleans, filed the present suit, seeking to declare the ordinance null and void and to enjoin the closure of the street. Trinity intervened in the suit and joined with the city as a party defendant in resisting the claims of the plaintiffs. Plaintiffs contended that the City of New Orleans had no authority to enter into a lease of a public street to a private concern and that even if it did, the lease of a presently-used public street was arbitrary and capricious. The trial court denied the petition. The court of appeal affirmed. The state supreme court granted certiorari, declared the ordinance null and void, but then granted a rehearing.

Issue:

Did the City of New Orleans have the authority to enter into a lease of a public street to a private concern?  

Answer:

Yes.

Conclusion:

The state supreme court found that neither the Louisiana Civil Code nor the Louisiana Constitution prohibited the city from alienating a public street. Specific authority to sell, lease, exchange or otherwise dispose of public property was authorized by New Orleans, La., Home Rule Charter §§ 3-112(5)(d), 6-307(4), and La. Rev. Stat. Ann. § 33:4712(A). Thus, the city council possessed the legal authority to enter into a lease of the street block with the church. The city council determined that the benefits from closing the block outweighed whatever inconvenience the closure would have had on the neighborhood. The state supreme court was unable to say that the city council was arbitrary and capricious in its determination that the street block was no longer needed for public purposes and that it could be leased to the church under the terms and provisions agreed upon by the parties to the lease.