A state appeals court panel has ruled in favor of the city of San Diego in its litigation against San Diego Gas & Electric, in which the city argued the utility should pay to relocate gas pipelines and other infrastructure to accommodate a pair of city water projects.
San Diego filed two lawsuits against the utility in 2020, claiming SDG&E was responsible for relocating its facilities and equipment to make way for the Pure Water project — intended to recycle wastewater into drinkable water — as well as the Montezuma project, which aims to complete the final segment of the Mid-City pipeline.
Amid the dispute over who should pay the relocation costs, the city agreed in 2018 to pay to move SDG&E’s facilities in order to avoid delaying the projects, but argued in its lawsuits that the utility should reimburse the city.
While a San Diego Superior Court judge ruled in SDG&E’s favor in late 2022, the city appealed and a three-justice panel of the Fourth District Court of Appeal agreed with the city on Monday.
“We are disappointed by the appellate court’s decision,” SDG&E said in a statement. “Nonetheless, we remain dedicated to working collaboratively with the city of San Diego on existing and future infrastructure projects to improve our community.”
San Diego Superior Court Judge Eddie Sturgeon originally granted SDG&E’s motion to dismiss the lawsuits and ruled the city would be responsible for the relocation costs. At the time, both sides argued over whether the projects were “proprietary” or “governmental,” with the judge deciding the projects were proprietary in nature and thus the city was financially responsible for relocation costs.
In the city’s appeal of Sturgeon’s ruling, city attorneys forwarded a different argument, that the long-time franchise agreement between San Diego and SDG&E mandated that the utility pay the relocation costs.
The appellate panel agreed with the city and overturned Sturgeon’s ruling by finding SDG&E agreed in the franchise agreement “to relocate its facilities and equipment if required to accommodate a city improvement impacting the city’s streets. Moreover, it agreed to such relocation at no cost to the city.”
