Appendix — Kingston Constructors, Inc. v. Washington Metropolitan Area Transit Authority
Supreme Court brief1997
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~_ Supreme Court, U.S.
V FILED
BE1GBO6 AR 9 1997
vitis
In the
SUPREME COURT OF THE UNITED STATES
October Term, 1997
KINGSTON CONSTRUCTORS INC.
Petitioner,
Vv.
WASHINGTON METROPOLITAN AREA TRANSIT
AUTHORITY
Respondent.
Appendix to
Petition for Writ of Certiorari
To the Supreme Court of California
APPENDIX TO
PETITION FOR WRIT OF CERTIORARI
Ronald K. Losch,
Attormey for Petitioner
KINGSTON CONSTRUCTORS INC.
INDEX TO APPENDIX
Clerk’s Default, California Superior Court, County
of Los Angeles, Case No. BC056254, Entered on
October 19, 1992
Default Judgment, California Superior Court,
County of Los Angeles, Case No. BC056254,
Entered on May 5, 1994
Order Vacating Default Judgment , California
Superior Court, County of Los Angeles, Case No.
BC056254, Entered on September 1, 1994
Order Denying Motion for Reconsideration, order
Vacating Default Judgment, California Superior
Court, County of Los Angeles, Case No.
BC068273, Entered on September 1, 1994
Opinion, Division Two of the Second Appellate
District of the Court of Appeal of California,
Entered April 3, 1996
Opinion, Supreme Court of California, Case No.
$053577, Entered on January 9, 1997
Washington Metropolitan Area Transit Authority
Compact, (Pub.L. No. 89-774 (Vol. 6, 1966) Stat.
1324-1325.)
Page
App. 1
App. 4
App. 7
App. 9
App. 11
App. 20
App. 34
App. 2
. ‘ LE.
a d
THE FEDERALIST NO. 81 App. 64
THE FEDERALIST NO. 82 App. 74
bi Oy ech a re, Cammanat e
App. 1
Clerk’s Default, California Superior Court, County of Los
Angeles, Case No. BC056254, Entered on October 19, 1992
.
- LAW OFFICES OF JULIAN A. POLLOK, A P.C.
1000 WILSHIR® BOULEVARD, SUITE 650
TE BAR NO. 48484-
} LOS ANGELES,
CA 90017
arroneay Fun pees Plaint itt
SR Say STATE OF CALIFORNIA ei a 5 aml
1ED
PLAINTIFF: pate ENERGY INDUSTRIES, = 7
California corporation, if
9 1992
perew, KINGSTON CONSTRUCTORS, INC., 2 4 Tl
corporation, etc., et al. pet 7 . es nn
REQUEST FOR wo ENTRY OF DEFAULT [7] CLERK'S JUDGMENT i
COURT JUDGMENT co
7 To Te CLERC See Ps -=- - a
a on(cmm)X May 28, 1992 =
b by(rame): Power Energy Industries
+]
. : _ m
a © JERinston Ares Wen hetropeliten Transit Authority, a EC = bs
the court wil ener a jucigment on an affidadt under CCP SBS(D.)
e Co) Enter clertrs pudguent
(1) CC) for restitution of the premises onty and issue a wit of execution on the
3 apply. (CCP 1169)
@ €) uncer CCP S85(a) (Compiste te cectaraton under CCP S855 on the reverse.)
& CC) ter deteutt previousty entered on (cate):
2 auckgrent to be entorect aa, recite Acknowledged e Selance _
& Demand of Compiaint fa 5 a 3 [3 3
B Statement of cameges (CCP 425.11) = xs 5
(eupertor court anty)* = 2
(1) Special $ t 2 ~VCN
(2) General a 3 22 ree OL Fic
© interest : z = . “ees mM=En
d Coste (eee reverse) 3 z -= sh ae ry
og a -“P=_—
¢ eee ; ee se : > s\k chin eee ary]
, @& Only damages complaint at the rate of: $ per Gay m: =
Oats: August 4, 1992 iw” =
JULIAN A. POLLOK ac LC frttie \e Pam
Pe) RARE OF INTO OR ATTORSG ae ee
"Personal injury er wrongful death actions onty. — . ep
=F : 1
a (1) (4 Detaut entered as requested on (ata: OCT 19 1992 > rate:
COURT Dstauit NOT entered ss requested ; ' 4
USE ONLY = (state reason): a = =
3 ~~ : 7 —
5 :
(Continued on reverse)
aeaca Core cme REQUEST FOR ENTRY OF DEFAULT eS
SHORT TITLE POWER ENERGY INDUSTRIES v. KINGSTON Sa
CONSTRUCTORS, INC., etc., et al. BCO56254
DECLARATION UNDER CCP 585.5 (Required for clerk's judgment under CCP 585(a))
3. This action
aC) *® &) ‘not on a contract or instalment sate for goods or services subject to CC 1801, etc. (Unrun Act) ,
bd. t= (XH) isnot on a conditional sales contract subject to CC 2981, etc. (Rees-Levering Motor Venicie Sales and Finance Act) ;
c. CE) * Cy tenct on an obligation for goods, services, loans, or extensions of credit subject to CCP 300(b). ;
| Gectare under penalty of perjury under the tews of ths State of California that the foregoing is true and correct.
date: August 4, 1992 i J el
SPYRE OR SOETT MRR OF OR CLARET) CROMATURE OF OF CLARAHT)
.
DECLARATION OF MAILING (CCP 587)
4 Acopy of the foregoing request was
0a not mailed to the following dafcndants whose addressees are uninown to piaintif! or plaintiffs attorney (namea):
o mailed first-class, postage prepaid, in 8 sealed envelope to each Gefendant’s attorney of record, or none, to each
Gsfendant at tast known sddrese
(1) on (Gate): (8/4/92 (2) to (apecty names and adcreeess shown on the erweiopea):
“Managing Director
‘ Washington Area Metropolitan Transit Authority, a corporation
600 Fifth Street, N.W.
Washington, D.C. 20001
a ee
Date: August 4, 1992 ‘ f
“BARBARA K, SEVITTS ............ em WN". batts
CTV8 Of SReerT meneet) x CRGRATURE OF OE CLAMEIT)
MEMORANDUM OF COSTS (Required if judgment requested)
A 8
©. Process server's [008 ...... 2.02. ceeeeee b |
C. Other (apecdly): ... 6.0 cece cece ee nceeees £
G] ccccccccccnccccccceccencccceseceses S
@ TOTAL SORES EHH HEHEHE HEE HEHEHE EEE ns
t. CJ Costs and diebu sements are waived.
| em the attorney, agent, or party who claims these costa. To the best of my mnowledge end beter tits memorandum of costs
te correct and theses costs were necessarily incurred in this case. ;
i dectare under penalty of par jury under the laws of the State of California that the foregoing te true and correct.
Ae ee oe ee Siidietete? © 5% + he as o
DECLARATION OF NONMILITARY STATUS
& Wo defendant named above in item tc te in the military service 90 as to be entitied to the benefits of the Soldiers’ and Sailors’
Civil Relief Act of 1940 (50 U.S.C. Appen. § S01 et seq)
‘ cectare under penalty of perjury under the taws of the State of California that the foregoing 's true and correct.
ae.
App. 4
Default Judgment, California Superior Court, County of Los
Angeles, Case No. BC056254, Entered on May 5, 1994
1|| RONALD K. LOSCH - #98170
Attorney at Law ae
2ij 601 California Street, 21st Floor
San Francisco, California 94108 F
3]| Telephone: (415) 956-8400 IL E D
4|| Attorney for Defendant \ Ave
KINGSTON CONSTRUCTORS INC. ||‘ aa ‘94
8 [© 4p iene come
6 OFA CremenarTam, scney
7
3 SUPERIOR COURT FOR THE STATE OF CALIFORNIA
9 COUNTY OF LOS ANGELES
Case No. BC068273
(Related to
Case No. BC 056254)
DEFAULT JUDGMENT BY COURT
(C.C.P. §585)
POWER ENERGY INDUSTRIES,
plaintiff,
Ss he ot
So = ©
v,
bee
he
KINGSTON CONSTRUCTORS INC.,
at al.,
Beer
co
defendants.
pee
ow
eee St Ne Sut ae a ee a Oe ee te me?
This case having been considered by the Honorable Harvey A.
Schneider, Judge presiding in Department 52 of the above
entitled court.
It appearing that defendant Washington Metropolitan Area
Transit Authority having been regularly served with process,
having failed to appear and answer plaintiff's complaint filed
herein, and the default of this defendant having been duly
entered on October 19, 1992; on application of plaintiff's
successor in interest, Kingston Constructors Inc., to the court,
and after having considered the evidence, as Se
IT IS ORDERED that Kingston Constructors Inc. have om
BNRREBBE BESS &
recovered judgment from the said defendant in the sum of
00 1
cist a aa crac acre
1|| $6,924,758.00 damages; interest to the date hereof in the amount
2\| of $259,853.00; and attorney's fees in the sum of $50,655.00;
$|| together with interest on such judgment as ided law.
4}| Dated: Uc By LIAL
ee |
6
7 Los Steaks Soames
8
9
10
11
12
13
14
15
Wee eUBeesess
App. 7
Order Vacating Default J udgment, California Superior Court,
County of Los Angeles, Case No. BC056254, Entered on
September 1, 1994
SUPERIOR COURT OF CALIFORNIA, COUNTY OF Los ANGELES
DATE 09/01/94 DEPT. 52
HONORABLE HARVEY A. SCHNEIDER N DIGIAMBATTISTA DEPUTY CLERK
HONORABLE JUDGE PRO ELECTRONIC RECORDING MON
P E GERVIN/CSL Dupuy Seenitt | C ANDREWS Sagas
8:30 am/BC068273 Presets
FONER ENERGY INDUSTRIES Commt B. A. BROWN (X)
KINGSTON CONSTRUCTORS, INC Ln
L. P. LUBKA (X)
R. K. LOSCH (Xx)
K. S. GELLER (X)
NATURE OF PROCEEDINGS: _
MOTION OF DEPENDANT, WASHINGTON METROPOLITAN AREA
TRANSIT AUTHORITY, TO VACATE VOID AND TO
QUASH SERVICE OF SUMMONS OR TO MODIFY DEFAULT JUDGMENT
BY VACATING AWARD IN EXCESS OF JURISDICTION;
APPLICATION OF KENNETH S. GELLER TO APPEAR AS COUNSEL
PRO HAEC VICE
Matter comes on for hearing and is argued.
The motion to vacate the Gefault judgment as to Ramada
only is granted.
The aupl ication of Kenneth S. Geller to as
counsel pro haec vice is granted. Order is signed and
filed this date.
Defendant is to give notice.
MINUTES ENTERED
PAGE 1 DEPT. 52 09/01/94
COUNTY CLERK
App. 9
Order Denying Motion for Reconsideration, Order Vacating
Default Judgment, California Superior Court, County of Los
Angeles, Case No. BC068273, Entered on September 1, 1994
SUPERIOR COURT OF CALIFORNIA, COUNTY OF LOS ANGELES
aT 10/14/94 _ DEFT. 52
momcnams HARVEY A. SCHNEIDER MN DIGIAMBATTISTA —
wer mk JUDGE FRO TEM ELECTRONIC RECORDING MONITOR
” NONE Rongeaity C ANDREWS Rapes
8:30 am/ BC068273 Preasell?
POWER ENERGY INDUSTRIES Coumt RR. K. LOSCH (X)
xINCSTON CONSTRUCTORS, INC MraSvcatat
NATURE OF PROCEEDINGS:
MOTION OF DEFENDANT AND JUDGMENT ASSIGNEE KINGSTON
CONSTRUCTORS INC. FOR RECONSIDERATION OF ORDER
VACATING JUDGMENT;
Matter comes on for hearing and is argued.
The motion for reconsideration is denied.
Notice is waived.
MINUTES ENTERED
PAGE i DEPT. 52 10/14/94
COUNTY
Wingy
App. 11
Opinion, Division Two of the Second Appellate District of the
Court of Appeal of California,
entered April 3, 1996,
KINGSTON CONSTRUCTORS, INC. v.
WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY
49 Cal.App.4th 257; _ Cal.Rptr.2d__ [Apr. 1996]
(No. B088727. Second Dist. Div:, Two. Apr. 3, 1996.]
KINGSTON CONSTRUCTORS, INC., Plaintiff and Appellant, v.
WASHINGTON METROPOLITAN AREA TRANSIT
AUTHORITY, Defendant and Respondent.
COUNSEL
Ronald K. Losch for Plaintiff and Appellant.
Mayer, Brown & Platt, Kenneth S. Geller and Donald M. Falk, for
Defendant and Respondent.
OPINION
NOTT, J.--Appellant Kingston Constructors, Inc. (Kingston) appeals
from an order vacating a judgment that had been taken by default
against respondent Washington Metropolitan Area Transit Authority
(WMATA). The trial court concluded that it lacked subject matter
jurisdiction over this case. We agree and affirm the order.
FACTS AND PROCEDURAL HISTORY
Our focus will be on subject matter jurisdiction, which does not
require a long factual discussion. Therefore, we will briefly review the
background facts.
WMATA is an interstate agency created by the United States
Congress, Maryland and Virginia pursuant to the Washington
App. 12
Metropolitan Area Transit Authority Compact (Compact). (Pub. L. No.
89-774 (Nov. 6, 1966) 80 Stat. 1324.) The principal purpose of
WMATA, as stated in article Ii of the Compact, is to coordinate and
implement transit systems within the Washington, D.C., metropolitan
area. (/d., at p. 1325.) WMATA neither maintains facilities nor
operates transit systems outside the Washington, D.C., metropolitan
area.
Kingston, a California corporation, entered into a contract with
WMATA in 1991 to supply and install replacement transformers.
Kingston, in turn, purchased the transformers from Power Energy
Industries (PED, another California contractor. WMATA was
dissatisfied with the transformers and refused to pay for them.
[260]
PEI sued Kingston and WMATA in Los Angeles County Superior
Court in May 1992. Counsel for WMATA sent a letter to the clerk of
the superior court stating that WMATA would not enter an appearance.
PEI advised WMATA that the letter was not an appropriate response
to the complaint, 2nd warned that a default would be taken. Default was
in fact entered on October 19, 1992.
On December 22, 1993, PEI and Kingston entered into a settlement
agreement whereby PEI assigned its action agains’ WMATA to
Kingston. On May 3, 1994, Kingston was granted a default judgment
against WMATA in the amount of $6,934,758 plus interest and
attomey fees.
On August 12, 1994, WMATA filed a motion to vacate the judgment
on the grounds that it was void for lack of personal and subject matter
jurisdiction. WMATA relied on the language of the Compact to argue
that Congress intended that suits by and against WMATA could be
brought only in federal district courts in Maryland and Virginia, or the
Maryland and Virginia state courts, and that removal to the federal
court was limited to actions originally filed in the trial courts of those
two States.
App. 13
The pertinent language of the Compact is: "The United States
District Courts shall have original jurisdiction, concurrent with the
Courts of Maryland and Virginia, of all actions brought by or against
[WMATA] ....
Any such action initiated in a State Court shall be removable to the
appropriate United States District Court in the manner provided by Act
of June 25, 1948, as amended. (28 U.S.C. 1446.)" (Pub. L. No. 89-774
(Nov. 6, 1966) 80 Stat. 1350.)
The trial court found that Congress's intent was not made clear in the
Compact, but, citing federal case law, found itself obligated to construe
a federal waiver of immunity narrowly. Thus, the trial court interpreted
the language to limit jurisdiction as argued by WMATA and, as noted,
the court granted the motion on the subject matter jurisdiction ground.
This appeal followed.
CONTENTIONS
Kingston contends that (1) WMATA waived jurisdictional defects by
failing to comply with Code of Civil Procedure section 418.10 and by
filing a motion raising other issues, (2) the Compact waives sovereign
immunity for proprietary actions, (3) the Compact does not limit state
court jurisdiction, and (4) WMATA is estopped from raising a
jurisdictional challenge.
We address the second and third contentions first.
[261]
The Matter Was Correctly Dismissed for Lack of Subject Matter
Jurisdiction
(la) Kingston asserts that the Compact is a waiver of sovereign
immunity from suit in contract. We agree, but we find that contention
alone does not settle the question of whether the Compact confers
concurrent jurisdiction on all states, including California. Therefore, we
proceed directly to Kingston's third contention.
App. 14
Kingston argues that the Compact does not limit state court
jurisdiction. The first point made by Kingston is that state and federal
courts have concurrent jurisdiction.
(2) Kingston is correct in stating the general rule that state courts
may assume subject matter jurisdiction over a federal cause of action
absent a provision by Congress to the contrary or “disabling
incompatibility between the federal claim and state court." (Gulf :
Offshore Co. v. Mobil Oil Corp. (1981) 453 U.S. 473, 477 [69
L.Ed.2d 784,790-791, 101 S.Ct. 2870].) In considering the propriety
of state-court jurisdiction over any particular federal claim, we begin
with the presumption that state courts enjoy concurrent jurisdiction.
(Id., at p. 478 [69 L.Ed.2d at p. 791].) Because Congress may confine
jurisdiction to the federal courts either explicitly or impliedly, the
presumption can be rebutted by an explicit statutory directive. It can
also be rebutted by a clear incompatibility between state-court
jurisdiction and federal interests. (Ibid. )
(Ib) The provision at issue in Gulf Offshore granted the federal
district courts “original jurisdiction of cases and controversies arising
out of or in connection with any operations conducted on the outer
Continental Shelf .... ' [Citation.]" (453 U.S. at p. 479 [69 L.Ed.2d at
p. 791].) The argument in that case, however, was that state jurisdiction
was incompatible with federal jurisdiction, an argument that was
rejected by the court. Incompatibility is not the basis for WMATA's
position of limited jurisdiction, thus, for other than its statement of the
general rules of concurrent jurisdiction, Gulf Offshore is not controlling
authority here.
eh meee
Kingston aiso cites Yellow Freight System, Inc. v. Donnelly
(1990) 494 LLS. 820, 824 [108 L.Ed.2d 834, 840, 110 S.Ct. 1566],
which held that federal courts did not have exclusive jursdiction over
title VII cases. The statute stated that “[eJach United States district
court and each United States court of a place subject to the
jurisdiction of the United States shall have jurisdiction of actions
broughi under this subchapter." (Id., at p. 823 [108 L.Ed..2d at p.
839].) The court based its holding on the fact that the title VII
provision, unlike a number of other statutes in which Congress
nn
App. 15
unequivocally stated that the jurisdiction of the federal courts is
exclusive, contained no language expressly confining jurisdiction to
the federal courts. (Ibid. )
[262]
In this case, the Compact states (1) the federal district courts have
original jurisdiction concurrent with the Maryland and Virginia courts
of actions brought by or against WMATA, and (2) any action initiated
in a state court shall be removable to the appropriate federal district
court. Unlike Donnelly, here Congress was not silent on the question
of the jurisdiction of the state courts. The Compact addresses
concurrent jurisdiction, but limits it to the courts of only two states,
Virginia and Maryland.
Kingston argues that the use of the phrase “original jurisdiction" in
the Compact does not indicate that Congress intended to confer
exclusive jurisdiction on those courts, citing Brown v. Pitchess (1975)
13 Cal.3d 518, 521 [119 Cal.Rptr. 204, 531 P.2d 772]. There, the
question was whether California courts had jurisdiction over federal
civil rights actions brought under 42 United States Code section 1983.
Section 1983 did not address the question of jurisdiction, but the issue
was governed by the general statute which conferred upon federal
district courts original jurisdiction over any civil action. Thus, the
federal civil rights statute was even more silent than the statute at issue
in Donnelly, because section 1983 did not address the jurisdiction
question at all. That being So, the Califoria Supreme Court applied the
general rule and found concurrent jurisdiction.
Once again, we must distinguish Kingston's authority. The Compact
was not completely silent about jurisdiction, which would justify
reliance on the general rule of concurrent jurisdiction as applied by the
Brown court. Rather, the Compact refers to original jurisdiction in the
Same sentence as the reference to the two states, which leads to the
conclusion that Congress intended state jurisdiction to be limited to
Maryland and Virginia. We agree that conferring original jurisdiction
without more does not confer exclusive jurisdiction, or divest state
courts of their concurrent jurisdiction, and we agree with the trial court
App. 16
that the language of the Compact could have been clearer. There is
more in the Compact, however. To find that there is concurrent
jurisdiction in all state courts would make superfluous the mention of
two specific states. Thus, even if the Compact does not clearly
explicitly confer jurisdiction on the federal district courts and the two
state courts, it impliedly does so.
Kingston contests this last point, arguing that conferring jurisdiction
on two states does not impliedly divest the other states of concurrent
jurisdiction. Kingston again cites several authorities for the general
proposition that states have concurrent jurisdiction unless that
jurisdiction is excluded by Congress, quoting from The Federalist No.
82 (Hamilton) and New York v. United States (1992) 505 U.S. 144,
162-163 [120 L.Ed.2d 120, 141-142, 112 S.Ct. 2408].
[263]
Kingston also quotes Gregory v. Ashcroft (1991) 501 U.S. 452, 460
[115 L.Ed.2d 410, 423, 111 S.Ct. 2395], with more specific language
requiring that Congress make it "unmistakably clear" that it intends to
preempt the historic powers of the states, language that appears to
contradict Gulf Offshore Co. v. Mobil Oil Corp., supra, 453 U.S. 473,
which permits an implied restriction of jurisdiction. Gregory, however,
is not a concurrent jurisdiction case at all. In Gregory, Missouri state
court judges attempted to challenge the state's mandatory retirement in
federal court as a violation of the federal Age Discrimination in
Employment Act. The Supreme Court affirmed the lower court's
dismissal of the action, holding that congressional interference with a
decision of the citizens of Missouri regarding the qualifications of their
judges “would upset the usual] constitutional balance of federal and state
powers," which can be done but which requires a clear and manifest
Statement of intention to preempt the historic powers of the states. (501
U.S. at p. 460 [115 L.Ed.2d at p. 423].) The issues in Gregory were
Clearly different from those before the court in Gulf Offshore Co., and
Gregory has no application to the matter before us. Under Gulf
Offshore and other concurrent jurisdiction cases, implied restriction of
concurrent jurisdiction is permissible.
App. 17
Kingston turns to the definition section of the Compact for support.
Title Hl, article I, entitled "Definitions" states in subdivision (e) that the
word "state" includes the District of Columbia. (Pub. L. No. 89-774
(Nov. 6, 1966) 80 Stat. 1325.) Kingston contends that in numerous
sections of the Compact, when the Congress sought to refer only to
Maryland and Virginia, Congress referred to them as “signatories” or
“signatory states." Kingston concludes that when Congress used the
term “state” in the section at issue here, Congress must have intended
to refer to all states, including the District of Columbia.
This analysis omits subdivision (d) of the definitions section of the
Compact, which states that the term "signatory" means Maryland,
Virginia and the District of Columbia. Thus, the references in the
Compact to “signatories” and "signatory states" which Kingston has
cited to us cannot simply refer only to Maryland and Virginia.
Moreover, the fact that Congress conferred concurrent jurisdiction on
the courts of Maryland and Virginia but not on the District of Columbia
courts can be explained. The Compact became law in 1966. The
District of Columbia's "state" superior courts were created by Congress
in 1970. Pub.L. No. 91-358 (July 29, 1970) 84 Stat. 475, § 1 1-101,
subd. (2)(B).) Prior to 1970, civil actions involving damages exceeding
$10,000 were
[264]
heard in the United States District Court for the District of Columbia.
(Pub. L. No. 88-241 (Dec. 23, 1963) § 11-962, 77 Stat. 490, § 11-
962.)
Under our interpretation of the Compact, if a plaintiff were to file an
action against the WMATA in courts of either Maryland, Virginia or
the District of Columbia, which is considered a state for purposes of the
Compact, the WMATA may seek removal to federal court. Our
reading of the Compact is consistent with the interpretation by the
federal district court in District of Columbia ex rel. Geo-Systems, Inc.
v. Mergentime Corp. (U.S. Dist. Ct. (D.D.C.), 1992, No. 92-1474-
LFO), an unpublished decision of the district court of the District of
App. 18
Columbia.
Kingston relies on Mergentime, in which the WMATA was cross-
defendant and had successfully removed the cross-complaint to the
federal court from the "state" court of the District of Columbia. The
issue before the court was whether the removal of the entire action, as
requested by the defendant in the main action, was permissible. In its
discussion, the federal trial court noted that “Congress's intent in
enacting the WMATA removal provision . . . calls for the exercise of
federal jurisdiction here, particularly in light of the fact that the
provision establishes concurrent jurisdiction in the Virginia and
Maryland courts, but not the District of Columbia courts." (District of
Columbia ex rel. Geo-Systems, Inc. v. Mergentine Corp., supra, No.
92-1474-LFO.)
Kingston argues that, in this case, the WMATA's “exclusive remedy”
was to remove this action to federal court. The argument implies that
because the WMATA did not remove the action to federal court, the
WMATA is obligated to defend itself in a California court. But that
cannot be. Medlin v. Boeing Vertol Co. (3d Cir. 1980) 620 F.2d 957,
960 held that the plaintiff's failure to challenge removal cannot confer
on a federal court subject matter jurisdiction that it does not otherwise
possess. Likewise, the defendant's failure to seek removal cannot confer
subject matter jurisdiction on a state court. (See National Union Fire
Ins. Co. v. Stites Prof. Law Corp. (1991) 235 Cal.App.3d 1718, 1723-
1724 [ 1 Cal.Rtr.2d 570] [subject matter jurisdiction cannot be
conferred by consent, waiver or estoppel].)
As stated in National Union Fire Ins. Co. v. Stites Prof. Law Corp.,
supra, 235 Cal.App.3d at pages 1723-1724, a challenge to subject
matter jurisdiction cannot be waived, nor can it be barred by application
of the doctrine of estoppel. Indeed, lack of subject matter jurisdiction
can be raised for the ftrst time on appeal. (/d., at p. 1724.) Therefore,
to the extent that Kingston's waiver and estoppel arguments address
subject matter jurisdiction, we need not consider them. Having
concluded that we are without subject matter jurisdiction, we need not
determine Kingston's personal jurisdiction contentions.
App. 19
The order is affirmed.
DISPOSITION
Boren, P. J., and Zebrowski, J., concurred.
App. 20
Opinion, Supreme Court of California, Case No. $053577,
entered on January 9, 1997
[No. $053577. Jan. 9, 1997.]
KINGSTON CONSTRUCTORS, INC., Plaintiff and Appellant, v.
WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY,
Defendant and Respondent.
COUNSEL
_ Ronald K. Losch and Lesley Annis for Plaintiff and Appellant.
Mayer, Brown & Platt, Kenneth S. Geller and Donald M. Falk for
Defendant and Respondent.
OPINION
MOSK, J.--We granted review in this cause to address a question of
first impression concerning the Washington Metropolitan Area Transit
Authority Compact (hereafter the WMATA Compact or the compact)
and its creature, the Washington Metropolitan Area Transit Authority
(hereafter WMATA or the authority), which is a regional
instrumentality empowered, among other things, to provide transit
facilities in and around the District of Columbia and neighboring parts
of the State of Maryland and the Commonwealth of Virginia,
comprising the Washington Metropolitan Area Transit Authority Zone
(hereafter the WMATA Zone).
The question is: Do the courts of the State of California have
jurisdiction of actions brought by or against WMATA?
For the reasons that follow, we conclude that the answer is: No.
On May 28, 1992, Power Energy Industries (hereafter PEI), a
California corporation, brought an action in the Los Angeles Superior
Court, bearing No. BC056254, against Kingston Constructors, Inc.
ee
App. 21
(hereafter Kingston), another California corporation, and WMATA.
PEI asserted various claims in contract and in tort, and sought damages
and costs including attorney fees, based on allegations to the following
effect: WMATA entered into a contract with Kingston to supply and
install certain electrical transformers, with PEI as an intended third
party beneficiary to design and manufacture the items; Kingston in turn
entered into a subcontract with PEI to design and manufacture the
electrical transformers; WMATA and Kingston proceeded to breach
duties they owed PEI pursuant to the contract and the subcontract, and
Caused it injury; they also violated obligations they bore it under the law
of torts, and caused it injury in this way as well.
By letter dated July 24, 1992, WMATA informed the clerk of the
superior Court that it would not enter an appearance in No. BC056254
because, among other reasons, under section 8] of the WMATA
Compact the superior court did not have jurisdiction of the action as to
the Authority. Within days, WMATA communicated its position to
PEI, and PEI in turn communicated it to Kingston.
It appears that, on or about September 9, 1992, on PEI's motion, the
superior court dismissed Kingston as a party from No. BC056254
without prejudice.
On October 19, 1992, on PEI's application, the clerk of the
Superior court entered WMATA's default in No. BC056254.
It appears that, on or about November 10, 1992, PEI brought an
action in the superior court, bearing No. BC068273, against Kingston
alone--an action that was substantially similar to No. BC056254.
On December 22, 1993, as part of the settlement of No. BC068273,
PEI assigned to Kingston its claims against WMATA in No.
BC056254.
On May 5, 1994, the superior court rendered judgment on default in
App. 22
No. BC056254,! in favor of Kingston as assignee of PEI's claims and
against WMATA, awarding damages in the sum of $6,934,758, plus
pre- and post-judgment interest, and attorney fees in the sum of
$50,655.
On September 1, 1994, on WMATA's motion, the superior court
issued an order vacating as void the judgment in No. BC056254.’ It
concluded that, under section 81 of the WMATA Compact, it did not
have jurisdiction of the action.
On November 9, 1994, Kingston filed a notice of appeal from the
superior court's order in No. BC056254.’
On April 3, 1996, in an opinion subsequently certified for publication,
Division Two of the Second Appellate District of the Court of Appeal
affirmed the superior court's order in No. BC056254* It held that,
under section 81 of the WMATA Compact, the lower court did not
have jurisdiction of the action.
On July 10, 1996, on Kingston's petition, we granted review. We now
affirm.
(la) The issue before us is whether California courts have jurisdiction
of actions brought by or against WMATA. Its resolution requires us to
set out the background.
WMATA is a regional instrumentality empowered, among other
: Apparently because of a clerical error, the judgment incorrectly bears No.
BC068273.
Apparently because of the clerical error on the judgment (see fn. 1, ante), the order
incorrectly bears No. BC068273.
Apparently because of the clerical error on the order (see fn. 2, ante), the notice of
appeal incorrectly bears No. BC068273.
Apparently because of the clerical error on the notice of appeal (see fn. 3, ante),
the Court of Appeal's opinion incorrectly bears No. BC068273.
App. 23
things, to provide transit facilities in and around the District of
Columbia and neighboring parts of Maryland and Virginia, which
comprise the WMATA Zone. (Pub.L. No. 89-774 (Nov. 6, 1966) 80
Star. 1324.) Its ultimate source of funding is Congress, the district, and
these two states. (Id. § I, 80 Star. 1331.)
The WMATA Compact established WMATA and created the
WMATA Zone. The compact was initiated and consummated by
Congress for federal purposes, including the “effective performance of
the functions of the United States Government located within the
[National Capital] Region" and the "preservation of the beauty and
dignity of the Nation's Capital." (Pub. L. No. 89-774 (Nov. 6, 1966)
preamble, 80 Stat. 1324; see generally, Sen.Rep. No. 1491, 89th Cong.
2d Sess. pp. 3-5, 27.) The compact was also intended to further joint
federal, state, and local objectives in the "Region," such as the
"satisfactory movement of people and goods," the “alleviation of
present and future traffic congestion," "economic welfare and vitality,"
“orderly growth and development," and the "comfort and convenience
of... residents and visitors." (Pub. L. No. 89-774 (Nov. 6, 1966)
preamble, 80 Stat. 1324.)
The WMATA Compact was entered into by the three signatories
within the WMATA Zone. The compact was joined by the District of
Columbia, through enactment by Congress (Pub.L. No. 89-774
(Nov. 6, 1966) 80 Stat. 1324-1325) pursuant to the United States
Constitution and its powers thereunder, specifically: (a) article I,
section 8, clause 17, which grants it power "[t]o exercise exclusive
Legislation in all Cases whatsoever, over [the] District" as "the Seat
of the Government of the United States": (b) article I, section 8,
Clause 3, which grants it power "[t]o regulate Commerce . .. among
the several States"; and (c) article I, section 8, clause 18, which
grants it power "[t]o make all Laws which shall be necessary and
proper for carrying [its other powers] into Execution." The compact
was also joined by Maryland, which is one of the two states that
border the district and come within the zone, through enactment by
its General Assembly. (1965 Md. Laws, ch. 869.) The compact was
joined as well by Virginia, which is the other of the two States that
border the district and come within the zone, through enactment by
App. 24
its General Assembly. (1966 Va. Acts, ch. 2.)
The WMATA Compact was consented to by Congress (Pub.L. No.
89-774 (Nov. 6, 1966) preamble, 80 Stat. 1324-1325) under article
I, section 10, clause 3 of the United States Constitution, which
provides that "[n]o State shall, without the Consent of Congress . .
enter into any . .. Compact with another State... ."
(2) So consented to, it became a law of the United States. (See, e.g.,
Texas v. New Mexico (1987) 482 U.S. 124, 128 [96 L.Ed.2d 105, 113-
114, 107 S.Ct. 2279].) As such, it is "supreme," pursuant to article VI,
clause 2 of the United States Constitution, "any Thing in the
Constitution or Laws of any State to the Contrary notwithstanding." It
thereby renders without effect any such state provision that is in
conflict. (See, e.g., State of Pennsylvania v. The Wheeling &c. Bridge
Co. et al. (1852) 54 U.S. (13 How.) 518, 566 [14 L.Ed. 249, 269]; see
generally, Cipollone v. Liggett Group, Inc. (1992) 505 U.S. 504, 516
[120 L.Ed.2d 407, 422-423, 112 S.Ct. 2608].)
(Ib) Section 81 of the WMATA Compact, with which we are here
concerned, bears the title, "Jurisdiction of Courts,” and declares in its
entirety: "The United States District Courts shall have original
jurisdiction, concurrent with the Courts of Maryland and Virginia, of all
actions brought by or against WMATA] and to enforce subpoenas
issued under [the WMATA Compact]. Any such action initiated in a
State Court shall be removable to the appropriate United States District
Court in the manner provided by Act of June 25, 1948, as amended (28
U.S.C. 1446). (Pub.L. No. 89-774 (Nov. 6, 1966) § 1, 80 Star. 1350;
accord., § 4, 80 Stat. 1353.)
When we seek the meaning of section 81 of the WMATA Compact,
as we must, in its words within their context (see, e.g., Kopp v. Fair
Pol. Practices Corn. (1995) 11 Cal.4th 607, 672-673 [47 Cal.Rptr.2d
108, 905 P.2d 1248] (conc. opn. of Mosk, J.)), what we find is as
follows.
First, by its title and according to its terms, section 81 of the
WMATA Compact deals with the "jurisdiction" of courts over actions
ENT ne
ante.
Sete R -
App. 25 ©
brought by or against WMATA, namely, the power to consider and
decide such causes.°
Second, section 81 of the WMATA Compact specifies the "original"
jurisdiction of WMATA actions, that is, the power to entertain causes
of this sort in the first instance (Brown v. Pitchess (1975) 13 Cal.3d
518, 521 [119 Cal.Rptr. 204, 531 P.2d 772]). It appears to assume that
the "appellate" jurisdiction of such actions, that is, the power to review
their outcome, follows as otherwise provided.
Third, section 81 of the WMATA Compact expressly grants
jurisdiction of WMATA actions to the courts of the United States--
more precisely, it grants original jurisdiction specifically to the United
States District Courts. Because WMATA was established by the
WMATA Compact, actions involving the authority arise under the
compact, at least ultimately. (Cf. Osborn v. United States Bank (1824)
22 U.S. (9 Wheat.) 738, 823 [6 L.Ed. at p. 204, 224] [to similar effect
as to the second Bank of the United States, which was a federally
chartered corporation]; American Nat. Red Cross v. $.G. (1992) 505
U.S. 247, 264-265 [120 L.Ed.2d 201,217-218, 112 S.Ct. 2465] [to
similar effect as to the American National Red Cross, another federally
chartered corporation].) And because the compact is a federal law, such
actions are within the power of the federal courts pursuant to article II],
section 2, clause 1 of the United States Constitution. (Cf. Osborn vy.
United States Bank, supra, 22 U.S. (9 Wheat.) at p. 823 [6 L.Ed. at p.
224] [to similar effect as the federal charter of the second Bank of the
United States}; American Nat. Red Cross v. S.G., supra, 505 U.S. at
pp. 264-265 [120 L.Ed.2d at pp. 217-218] [to similar effect as to the
federal charter of the American National Red Cross].)°
rs What section 81 of the WMATA Compact speaks of as jurisdiction of an action
corresponds to what California law refers to as “[Jurisdiction of the subject matter"
(2 Witkin, Cal. Procedure (4th ed. 1996) Jurisdiction, § 10, p. 555; see, e.g.,
Greener v. Workers’ Comp. Appeals Bd.. (1993) 6 Cal.4th 1028, 1035 (25
Cal.Rptr.2d 539, 863 P.2d 784]; Abelleira v. District Court of Appeal (1941) 17
Cal.2d 280, 288 [109 P.2d 942, 132 ALR. 715)).
® In Qasim v. Washington Metro. Area Transit Auth. (D.C.App. 1983) 455 A.2d
904, 906 (in bank) (hereafter sometimes Qasim), the District of Columbia Court of
Appeals implied that WMATA actions are "local matters.” The “locality,” of
App. 26
Fourth, section 81 of the WMATA Compact expressly grants
jurisdiction of WMATA actions concurrently to the courts of Maryland
and Virginia--more precisely, it grants them original jurisdiction, albeit
without further specification.’ The WMATA Zone embraces territory
belonging to these two states. As a result, it encompasses geographical
area within which their courts may properly exercise judicial power--
subject, of course, to the requirements of the due process clause of the
Fourteenth Amendment to the United States Constitution (see, e.g.,
Shaffer v. Heitner (1977) 433 U.S. 186, 189-212 [53 L.Ed.2d 683,
688-703, 97 S.Ct. 2569]).*
Fifth, and crucial,. section 81 of the WMATA Compact impliedly
denies jurisdiction of WMATA actions to the courts of states other than
Maryland and Virginia--more precisely, it impliedly denies them
course, is the District of Columbia, which is “the Seat of the Government of the
United States” (U.S. Const., art. I, § 8, cl. 17), and neighboring parts of Maryland
and Virginia—the "National Capital Region.” (Pub. L. No. 89-774 (Nov. 6, 1966)
preamble, 80 Stat. 1324.) We do not understand the Qaswn court's implication to
amount to a denial that the WMATA Compact is a federal law. Such a denial
would be erroneous.
If it is parsed strictly, section 81 of the WMATA Compact expressly grants
jurisdiction of WMATA actions to the courts of Maryland and Virginia and
concurrently to the courts of the United States.
8 ‘That section 81 of the WMATA Compact does not expressly grant jurisdiction of
WMATA actions concurrently to the local courts of the District of Columbia is not
surprising. At the time the compact was consented to by Congress it was the courts
of the United States, and not the district's local courts, that functioned as “state”
courts for the district. “[T]he local court system consisted of one appellate court
and three trial courts, two of which... were courts of special jurisdiction. The third
trial court... was one of quite limited jurisdiction .... The judgments of the appellate
court... were subject to review by the United States Court of Appeals for the
District of Columbia Circuit.” (Palmore v. United States (1973) 411 U.S. 389,
392, fn. 2 [36 L.Ed.2d 342, 348-349, 93 S.Ct. 1670); see generally, Pub.L. No.
88-241 (Dec. 23, 1963) 77 Star. 478.) Subsequently, the district's local courts were
reorganized to “succeed” the federal courts in their function as “state” courts for the
district. (See Palmore v. United States, supra, 411 U.S. at pp. 407-409 [36
L.Ed.2d at pp. 357-358]; see generally, Pub. L. No. 91-358 (July 29, 1970) 84
Star. 473, 475.)
We note in passing that the Qasim court held that section 81 of the WMATA
Compact impliedly grants jurisdiction of WMATA actions concurrently to the
District of Columbia's local courts as reorganized. (Qasim v. Washington Metro.
Area Transit Auth., supra, 455 A.2d at pp. 906-907.)
i en
|
App. 27
original jurisdiction. It explicitly includes Maryland and Virginia
courts. It thereby implicitly excludes the rest. Expressio duorum,
exclusio ceterorum. The WMATA Zone does not embrace territory
belonging to any of the other states. As a result, it does not encompass
geographical area within which their courts could properly exercise
judicial power.
Not to the contrary is the language of section 81 of the WMATA
Compact itself: "The United States District Courts shall have Original
jurisdiction, concurrent with the Courts of Maryland and Virginia, of all
actions brought by or against (WMATA].... Any such action initiated
in a State Court shall be removable to the appropriate United States
District Court . . . . "" (Pub.L. No. 89-774 (Nov. 6, 1966) § 1, 80 Stat.
1350.) Read in context, the later phrase, "State Court," is a mere
shorthand for the earlier one, "the Courts of Maryland and Virginia.” It
cannot reasonably be taken to mean the courts of the several states
generally.’ To do so would obliterate the manifest distinction drawn
between Maryland and Virginia, on the one side, and the other states,
on the opposite. Neither can it reasonably be taken to mean the courts
of states other than Maryland and Virginia. To do so would entail the
conclusion that a WMATA action "initiated" in a court of Maryland or
Virginia" shall not be removable to the appropriate United States
District Court ...." Practical construction undermines such a position:
WMATA actions initiated in Maryland or Virginia courts are in fact
removed (see Malone v. Washington Metro. Area Ti ransit Auth.
(E.D.Va. 1985) 622 F. Supp. 1422, 1424),
Sixth, and final, section 81 of the WMATA Compact provides that
a WMATA action initiated in a Maryland or Virginia court may be
removed to the appropriate federal district court in accordance with
section 1446 of title 28 of the United States Code, which specifies the
procedures for removal (City of Cincinnati, Ohio v. Weaver (S.D.Ohio
Being not at all similar to provisions such as section 1352 of title 28 of the United
States Code, which declares that, Subject to a limited exception, the United States
“district courts shall iave original jurisdiction, concurrent with State courts. Of
any action on a bond executed under any law of the United States .... "(Italics
added.)
App. 28
1965) 245 F. Supp. 529, 532).
It follows from the forgoing that California courts do not have
jurisdiction of WMATA actions. Section 81 of the WMATA Compact
impliedly denies jurisdiction of such actions to the courts of states other
than Maryland and Virginia. It thereby denies it to those of California.
Against this conclusion, Kingston argues that section 81 of the
WMATA Compact does not in fact grant jurisdiction of WMATA
actions only to the courts of the United States and to those of Maryland
and Virginia. It urged this point vigorously in the superior court and the
Court of Appeal, but has all but abandoned it here.
What remains is this: Under decisions such as Yellow Freight
System, Inc. v. Donnelly (1990) 494 U.S. 820 [108 L.Ed.2d 834, 110
S.Ct. 1566] (hereafter sometimes Yellow Freight System), Taffiin v.
Levitt (1990) 493 U.S. 455 [107 L.Ed.2d 887, 110 S.Ct. 792]
(hereafter sometimes Taffiin), Gulf Offshore Co. v. Mobil Oi! Corp.
(1981) 453 U.S. 473 [69 L.Ed.2d 784, 101 S.Ct. 2870] (hereafter
sometimes Gulf Offshore Co.), and Dowd Box Co. v. Courtney (1962)
368 U.S. 502 [7 L.Ed.2d 483, 82 S.Ct. 519] (hereafter sometimes
Dowd Box Co.), there is a “presumption that state courts enjoy
concurrent jurisdiction” with federal courts (Gulf Offshore Co. v. Mobil
Oil Corp., supra, 453 U.S. at p. 478 [69 L.Ed.2d at pp. 791-792];
accord, Yellow Freight System, Inc. v. Donnelly, supra, 494 U.S. at p.
823 [108 L.Ed.2a at pp. 839-840); Taffin v. Levitt, supra, 493 U.S. at
p. 458 [107 L.Ed.2d at pp. 893-894]; see Gulf Offshore Co. v. Mobil
Oil Corp., supra, 453 U.S. at pp. 477-478 [69 L.Ed.2d at pp. 790-
792}; Dowd Box Co. v. Courtney, supra, 368 U.S. at pp. 507-508 [7
L.Ed.2d at pp. 486-488]).
Under Yellow Freight System, Taffiin, Gulf Offshore Co., and Dowd
Box Co., there is indeed a “presumption of concurrent jurisdiction"
between federal courts and state courts. (Gulf Offshore Co. v. Mobil
Oil Corp., supra, 453 U.S. at p. 478 [69 L.Ed.2d at p. 791].) But that
presumption arises when the jurisdictional provision in question is
silent as to the jurisdiction of state courts. That is not the case here.
ee
App. 29
In Yellow Freight System, the jurisdictional provision is section
706(f) of title VII of the Civil Rights Act of 1964: "Each United States
brought” thereunder. (Pub.L. No. 88-352 (July 2, 1964) tit. Vil, §
706(f), 78 Stat. 260-261: see Yellow Freight System, Inc. y. Donnelly,
supra, 494 U.S. at p. 823 [108 L.Ed.2d at Pp. 839-840].) There is not
Person injured in his business or Property by reason of a violation of
{the act] may sue therefor in any appropriate United States district court
--- "' (Pub.L. No. 91-452 (Oct. 14, 1970) tit. IX, 84 Stat. 944; see
Taffin v. Levitt, supra, 493 U.S. at Pp. 460 [107 L-Ed.2d at pp. 894-
895].) Again, not a word about State Courts or their jurisdiction.
Stat. 463; see Gulf Offshore Co. v. Mobil Oil Corp., supra, 453
U.S. at pp. 478-479 [69 L.Ed.2d at pp. 791-792}.) Again, not a word
about state courts or their jurisdiction.
United States having jurisdiction of the parties "(Pub.L. No. 101,
80th Cong. Ist Sess. (June 23, 1947) title III, § 301(a), 61 Stat. 156:
see Dowd Box Co. y. Courtney, supra, 368 U.S. 502.) Again, not a
word about state courts or their jurisdiction.
App. 30
Here, the jurisdictional provision is section 81 of the WMATA
Compact, which, it will be recalled, states in pertinent part that "'[t}he
United States District Courts shall have original jurisdiction, concurrent
with the Courts of Maryland and Virginia, of all actions brought by or
against" WMATA (Pub.L. No. 89-774 (Nov. 6, 1966) § 1, 80 Stat.
1350; accord, id., § 4, 80 Stat. 1353). Its words are largely directed at
state courts and their jurisdiction--to the express effect that the courts
of Maryland and Virginia have jurisdiction of WMATA actions
concurrently with courts of the United States, and to the implied effect
that the courts of other states do not.'®
Kingston then argues that, if section 81 of the WMATA Compact
purports to grant jurisdiction of WMATA actions only to the courts of
the United States and to those of Maryland and Virginia, it is violative
of the United States Constitution and thereby void. It hardly raised this
point in the superior court or the Court of Appeal, but urges it
vigorously here.
We begin with the "heavy presumption" that section 81 of the
WMATA Compact, like all other provisions of all other federal laws,
does not violate the United States Constitution. (Department of Labor
v. Triplett (1990) 494 U.S. 715, 721 [108 L.Ed.2d 701,713-714, 110
S.Ct. 1428].) As will appear, we shall end with the conclusion that this
presumption has not been rebutted.
Congress's power under article I, section 8, clause 17 of the United
Kingston quotes our statement in Brown v. Pitchess, supra, 13 Cal. 2d at page
521: “The phrase ‘original jurisdiction’... does not mean exclusive jurisdiction.”
That is true. But it is of no benefit to its position. Our analysis does not assume the
opposite.
In holding that section 81 of the WMATA Compact impliedly grants jurisdiction
of WMATA actions concurrently to the District of Columbia's local courts as
reorganized (see fn. 8, ante), the Qasim court relied on the “Presumption of
concurrent jurisdiction” (Gulf Offshore Co. v. Mobil Oil Corp., supra, 453 U.S. at
p. 478 [69 L. Ed.2d at pp. 791-792]) between federal courts and state courts.
(Qasim v. Washington Metro. Area Transit Auth., supra, 455 A.2d at p. 907.) We
must reject the soundness of its reliance. But we need not pass on the correctness of
its holding. One may justify its conclusion on the ground, not available to the
courts of any of the states, that the district's local courts as reorganized “succeeded”
the federal courts in their function as “state” courts for the district.
App. 31
States Constitution "[rio exercise exclusive Legislation in al! Cases
whatsoever, over" the District of Columbia as "the Seat of the
Government of the United States," is broad indeed. It has been
called "plenary." (Pamore v. United States, supra, 411 U.S. at p.
397 [36 L.Ed.2d at pp. 351-352].) And it has been held to extend
even “outside of" the district's "territorial limits." (National Ins. Co.
v. Tidewater Co. (1949) 337 US. 582, 600 [93 L.Ed. 1556, 1572,
69 S.Ct. 1173).) The reason is plain. It belongs to Congress "not [as]
a local legislature, but . . . in its high character, as the legislature of
the union." (Cohens v. Virginia (1821) 19 U.S. (6 Wheat.) 264, 429
[5 L.Ed. 257, 297].)
Similarly broad is Congress's power under article I, section 8,
Clause 3 of the United States Constitution "[t]o regulate Commerce .
- among the several States .... "It too has been called "plenary."
(Hodel v. Virginia Surface Mining & Recl. Assn. (1981) 452 US.
264, 276 [69 L-Ed.2d 1, 15-16, 101 S.Ct. 2352].) It is “complete in
itself, may be exercised to its utmost extent, and acknowledges no
limitations, o[t]her than are prescribed in the constitution." (Gibbons
v. Ogden (1824) 22 U.S. (9 Wheat.) 1,196 [6 L.Ed. 23, 70}.)
Whatever breadth may be lacking in its seat-of-government and
commerce powers is supplied to Congress through its power under
article I, section 8, clause 18 of the United States Constitution "[t]o
make all Laws which shall be necessary and proper for carrying [its
other powers] into Execution .... "This teaching is old. (See
McCulloch v. Maryland (1819) 17 U.S. (4 Wheat.) 316, 400-425 [4
L.Ed. 579, 600-606].) It remains vital today.
Section 81 of the WMATA Compact grants jurisdiction of
WMATA actions to the courts of the United States. It is not
problematic in this regard. As explained, because WMATA was
established by the WMATA Compact, actions involving the
a
App. 32
authority arise under the compact, at least ultimately; and because
the compact is a federal law, such actions are within the power of the
federal courts. The WMATA Zone includes the District of Columbia
as the seat of government. By embracing as well territory belonging
to Maryland and Virginia, it comprehends the commerce flowing
between and among the district and these two states.
Section 81 of the WMATA Compact also grants jurisdiction of
WMATA actions concurrently to the courts of Maryland and
Virginia. Neither is it problematic in this regard. It could surely have
denied jurisdiction of such actions to the courts of the several states
generally. (See, e.g., The Moses Taylor (1867) 71 U.S. (4 Wall.)
411, 428-430 [18 L.Ed. 397,401-402].) That it excepted the courts
of these two states causes no offense: The WMATA Zone embraces
territory belonging to them alone.
Kingston's attack on section 81 of the WMATA Compact under
the United States Constitution is essentially three pronged. The first
part effectively challenges the compact in general as an
unconstitutional agreement among states, including the District of
Columbia as a "state" along with Maryland and Virginia. It fails. As
explained, the compact was initiated and consummated by Congress
for federal purposes. As also explained, on its face and in its
substance, it is a federal law. Whether it is permitted is material--it
is--not whether it is required. (See Cuyler v. Adams (1981) 449 U.S.
433, 440 [66 L.Ed.2d 641,648-649, 101 S.Ct. 703].) The second
part of the attack also effectively challenges the compact in general,
this time as a federal law that is beyond Congress's powers. It too
fails. As explained, the compact falls comfortably within such
powers. The third part of the attack effectively challenges section 81
itself as invidiously discriminatory in favor of Maryland and Virginia
and against the other states, apparently in violation the Fifth
Amendment's due process clause. It fails as well. Any discrimination
effected by section 81 seems hardly invidious: the WMATA Zone
embraces territory belonging to Maryland and Virginia, and does not
embrace territory belonging to any other state. In consenting to the
compact, Congress effectively declared its view that section 81 was
not invidiously discriminatory. Included therein were senators and
App. 33
representatives from Maryland and Virginia. Included also, and in
overwhelming numbers, were their counterparts from the other
States. If these did not discern invidious discrimination in section 8 1 -
-and they apparently did not: they expressed no recorded Opposition-
-We have no basis to do otherwise.'!
Il
Having determined that California courts do not have jurisdiction
of actions brought by or against WMATA, we must, and do,
conclude that the Court of Appeal was right to hold that the superior
court did not have jurisdiction of No. BC056254 when it vacated the
judgment therein as void.
In arguing to the contrary, Kingston asserts that section 81 of the
WMATA Compact does not in fact grant jurisdiction of WMATA
actions only to the courts of the United States and to those of
Maryland and Virginia. We addressed the point above, and found it
wanting.
Kingston then asserts that, if section 81 of the WMATA Compact
purports to grant jurisdiction of WMATA actions Only to the courts
of the United States and to those of Maryland and Virginia, it is
violative of the United States Constitution and thereby void. We
addressed this point too, and found it wanting as well.
a“ To the extent that Kingston's claim that section 81 of the WMATA Compact is
Regional Planning Compact declares in pertinent part: “The appropriate courts of”
California and Nevada, "each within its limits of territory and subject matter
Provided by state law, are vested with Jurisdiction over... actions to which” the
Tahoe Regional Planning Agency "is a Party .... Each such action shall be
brought in a court of the state... where the property affected by [the] action is
Situated, unless the action is brought in a federal! court.’" (Pub. L. No. 91-148 (Dec.
To the extent that Kingston's claim against section 8] of the WMATA Compact
extends toviolation of such Provisions of the United States Constitution as article
III and the TenthAmendment, it must be rejected out of hand as insubstantial.
App. 34
Kingston finally asserts that, even if section 81 of the WMATA
Compact does in fact grant jurisdiction of WMATA actions only to
the courts of the United States and to those of Maryland and
Virginia, as a matter of California law WMATA waived any
challenge it might have had to the superior court’ s jurisdiction.
Whether such an outcome would be countenanced by the supremacy
Clause is a question we need not reach. The fact is, it is not the
outcome here. (3) Under California law, a party simply cannot waive
such a challenge. (DeTomaso v. Pan American World Airways, Inc.
(1-987) 43 Cal.3d 517, 520, fn. 1 [235 Cal.Rptr. 292, 733 P.2d
614).”
IV
For the reasons stated above, we conclude that we must affirm the
judgment of the Court of Appeal.
It is so ordered.
George, C.J., Kennard, J., Baxter, J., Werdegar, J., Chin, J.,
and
Brown, J., concurred.
12 Kingston complains that WMATA should have removed no. BC056254 from the
superior court to the appropriate United States District Court. Any such removal
would have been to no avail. Kingston assumes that the federal district court
would have acquired jurisdiction of the action from the superior court. Not so.
“{I}t is well settled that” when, as her, “the state court lacks jurisdiction. . . , the
federal court acquires none upon removal, even though the federal court would
have had jurisdiction if the suit had originated there.” (Arizona v. Manypenny
(1981) 451 U.S. 232, fn. 17 [68 L.Ed.2d 58, 69, 101 S.Ct. 1657]}.)
80 Stat.] PUBLIC LAW 89-774_Nov. 6, 1966
“Organization and Procedure
“7. The Board shall provide for its own organization and procedure.
It shall organize annually by the election of a Chairman and Vice.
Chairman from among its members. Meetings of the Board shall be
held as frequently as the Board deems that the proper performance
“Quorum and Actions by the Board
“8. (a) Four Directors or alternates consisting of at least one Direc-
tor or alternate appointed from each Signatory, shall constitute a
quorum and no action by the Board shal] be effective unless { majority
of the Board, which majority shall include at Jenst one Director or
alternate from each Signatory, concur therein ; provided, however,
that a plan of financing may be adopted or a mass transit plan adopted,
altered, revised or amended by the unanimous vote of the Directors
representitig any two Signatories.
‘(b) The actions of the Board shall be expressed by motion or
resolution. Actions dealing solely with internal np oy, ee of the
-\uthority shall become effective when directed by the Board, but no
other action shal] become effective prior ro the expiration of thirty
days following its adoption ; provided, however, that the Board may
provide for acceleration of any action upon a finding that suc
acceleration is required for the proper and timely performance of its
nctions,
“Officers
“9. (a) The officers of the Authority, none of whom shall be mem-
bers of the Board, shall consist of n penis manager, a secretary, a
treasurer, a comptroller and 2 Feneral counsel and such other officers
as the Board may provide. Except for the office of general manager
and comptroller, the Board many consolidate any of such other offices
in one person. Al] such officers shal] he appointed and may be re-
moved by the Board, shall Serve at the pleasure of the Board and shall
erform such duties and functions as the Board shall specify. The
oard shall fix and determine the compensation to be paid to all
officers and, except for the general manager who shall be a full-time
employee, all other officers may be hired on a full-time or art-time
basis and may be sompensated on a salary or fee basis, as the Board
may determine. .(]] employees and such officers as the Board may
designate shall be » pointed and removed hy the general manager
under such rules of
determine.
“(b) The general anager shall be the chief administrative officer
of the Authority and, subject to licy direction by the Board, shal]
bo responsible for al] Activities of the <uthority.
“(c) The treasurer shall be the enstodian bf the funds of the Av-
{ hority, shall keep an Account of all receipts and (lisbursements and
afew win lean Whe Cee meee ney we Sean mee cece maseec’
PUBLIC LAW 89-774—NOV. 6, 1966 [80 Srar.
“(d) An oath of office in the form set out in Section 5(b) of this
Article shall be taken, subscribed and filed with the Board by all ap-
pointed officers. ;
“(e) Each Director, officer and employees specified by the Board
shall give such bond in such form and amount as the Board may re-
quire, the premium for which shall be paid by the Authority. =
“Conflict of Interests
“10. (2) No Director, officer or employee shall :
“(1) be financially interested, either directly or indirectly, in
any contract, sale, purchase, lease or transfer of real or
property to which the Board or the Authority is a party;
“(2) in connection with services performed within the scope
of his official duties, solicit or accept money or any other thing
of value in addition to the compensation or expenses paid to him
by the Authority ;
~~" (3) offer money or any thing of value for or in consideration
of obtaining an appointment, promotion or privilege in his em-
, a with the Authority.
“(b) Any Director, officer or employee who shall willfully violate
any provision of this section shall, in the discretion of the Board, for-
feit his office or employment. :
“(c) Any contract or agreement made in contravention of this sec-
tion may be declared void by the Board.
“(d) Nothing in this section shall be construed to ab or
limit the applicability of any federal or state law which may be vio-
lated by any action prescribed by this section.
“Arricty IV
“PLEDGE OF COOPERATION
“11. Each Signatory pledges to each other faithful cooperation in
the achievement of the purposes and objects of this Title.
“ArrTICLE V
“GENERAL POWERS
“Enumeration
“12. In addition to the powers and duties elsewhere described in
this Title, and except as limited in this Title, the Authority may:
“(a) Sue and be sued;
“(b) Adopt and use a corporate seal] and alter the same at pleasure;
“(c) Adopt, amend, and repeal rules and regulations respecting
the exercise of the powers conferred by this Title; :
“(d) Construct, acquire, own, operate, maintain, control, sell and
convey real and personal property and any interest therein by con-
tract, pace condemnation, lease, license, ne or otherwise
but all of said property shall be located in the Zone and shall be
necessary or useful in rendering transit service or in activities inci-
dental thereto; |
“(e) Receive and accept such payments, appropriations, grants, |
gifts, loans, advances and other funds, properties and services as may
be transferred or made available to it by any signatory party, any
political subdivision or agency thereof, by the United States, or by
any agency thereof, or by any other public or private corporation or ;
individual, and enter into agreements to make reimbursement for all j
or any part thereof; : |
App. 35
Washington Metropolitan Area Transit Authority Compact,
(Pub.L. No. 89-774 (Vol. 6, 1966)
Stat. 1324-1325.)
PUBLIC LAW 89-774-NOV. 6, 1966 (80 Srar.
Public Law 89-774
i AN ACT
Whereas Congress heretofore has declared in the National Capital
* Transportation Act of 1960 (Public Law 86-669, 74 Stat. 537 ) and
in the National Capital Transportation Act of 1965 (Public Law
89-173, 79 Stat. 663) that a coordinated system of rail rapid transit
bus eenepenanien service, and highways is essentin] in the National
Capital Region for the satisfactory movement of people and goods,
the alleviation of present and future traffic congestion, the economic
welfare and vitality of all parts of the Region, the effective perform-
ance of the functions of the United States Government located within
~-~the Region, the orderly growth and development of the Region, the
comfort and convenience of the residents and visitors to the R ion,
and the premevation of the beauty and di ity of the Nation’s Capi
tal and that such a system should be develo cooperatively by the
Federal, State, and local governments of the National Capital Re-
gion, with the costs of the necessary facilities financed, as far as
possible, by persons using or benefiting from such facilities and the
remaining costs shared equitably among the Federal, State, and local
1ereas in furtherance of this policy, Congress, in title III of the Na-
tional Capital Transportation Act of 1960, authorized the District
of Columbia, the Commonwealth of Virginia, and the State of Mary-
land to negotiate a ape. ag for the establishment of an organizi-
alia, to provide regional transportation fa-
Whereas, it is the sense of the Congress that the Mass ‘Transit Plan
authorized by the Compact and this Act shal] conforin to the fullest
extent practicable with the Comprehensive Plan for the National
Capital and the general plan for the development of the National
Capital Region prepared pursuant to the National Capital Planning
Act of 1952 (Public Law 82-592, 66 Stat. 781) ; and
Whereas, the District. of Columbia, the Commonwealth of Virginia
and the State of Maryland, with a representative of the United
States appointed by the President, have negotiated such a Compact,
known as the Washington Metropolitan Area Transit Authority
omnaet, which amends the Washington Metropolitan Area Transit
ation Compact, heretofore consented to by the Congress (Pub-
lic Law 86-794, 74 Stat, 1031, as amended by Public Law 87-767,
76 Stat. 764), by ee thereto a title III and said Compact has
been enacted by Maryland (Ch. 869, Acts of General Assembly
1965) and in pa the same language by Virginia (Ch. 2,
1966 Acts of Assembly) : Now, therefore,
Be it enacted by the Senate and House of R entatives of the
United States of America in Congress assembled That the
hereby consents to adopts and enacts for the District of Columbia an
amendment to the Washington Metropolitan Area Transit Regulation
Compact, for which Congress heretofore has granted its consent (Pul)-
lic Law 86-794, 74 Stat. 1031, as amended by Public Law 87-767, 76
Stat. 764) by adding thereto title ITI, known as the Washington
PUBLIC LAW 89-774—NOV. 6, 1966 (80 Star.
“Anticte III
“ORGANIZATION AND AREA
“Washington Metropolitan Area Transit Zone
“3. There is hereby created the Washington Metropolitan Atea
Transit Zone which shal] embrace the District of Columbia, the cities
of Alexandria, Falls Church and Fairfax and the counties of Arling-
ton and Fairfax and political subdivisions of the Commonwealth of
Virginia located within those counties, and the counties of Mont-
gomery and Prince om. 32 in the State of Maryland and political
subdivisions of the State of Maryland located in said counties.
“Washington Metropolitan Area Transit Authority
“4. There is hereby created, as an instrumentality and agency of
each of the signatory parties hereto, the Washington Mctropolitan
Area Transit yong | which shall be a body corporate and politic,
and which shall have the powers and duties granted herein and such
——e powers as may hereafter be conferred upon it pursuant to
w.
“Board Membership
- “5. (a) The Authority shall be governed by a Board of six Directors
consisting of two Directors for each signatory. For Virginia, the
Directors shall be appointed by the Northern Virginia Transportation
Commission; for the District of Columbia, by the Commissioners of
the District of Columbia; and for Maryland, by the Washington Sub-
urban Transit Commission. In each instance the Director shall be
appointed from —- the members of the epee f body and shal]
serve for a term coincident with his term on the body by which he was
appointed. A Director may be removed or suspended from office on]
as provided by the law of the signatory from which he was appointed.
The appointing authorities shall also appoint an alternate for each
Director, who may act only in the absence of the Director for whom
he has. been pe, age an alternate, and each alternate shall serve at
the pleasure of the appointing authority. In the event of a vacancy in
the Office of Director or alternate, it shal] be filled in the same manner
as an original appointment.
“(b) Before entering upon the duties of his office each Director and _
alternate director shal] take and subscribe to the following onth (or
affirmation) of office or any such other oath or affirmation, if any, as
the Constitution or laws of the signatory he represents shall provide:
OF Oi saistiiediaaniapiiaie » hereby solemnly swear (or affirm) that I will
support and defend the Constitution of the United States and the
Constitution and Laws of the state or political jurisdiction from which
I was appointed as a director (alternate director) of the Board of
Washington Metropolitan Area Transit Authority and will faithfully
discharge the duties of the office upon which I am about to enter.’
“Compensation of Directors and Alternates
“6. Members of the Board and alternates shall- serve without
compensation but may be reimbursed for necessary expenses incurred
as an incident to the performance of their duties.
80 Star. ] PUBLIC LAW 89-774-NOV. 6, 1966
Metropolitan Area Transit Authority Compact (herein referred to as
title IIT), substantially as follows:
“TITLE III
“Arricir I
“DEFINITIONS
“1. As used in this Title, the following words and terms shal] have
the following meanings, unless the context clearly requires a different
meaning:
“(a) SRoard’ means the Board of Directors of the Washington Met-
ropolitan Arena Transit ppc!
“(b) ‘Director’ means a member of the Board of Directors of the
Washington Metropolitan Area Transit Authorit y;
“(c) ‘Private transit companies’ and ‘private carriers’ means co »)-
riutions, persons, firms or associations rendering transit service within
the Zone pursuant to a certificate of public convenience and necessity
issued by the Washington Metropolitan Area Transit Commission or
by a — granted by the United States or any signatory party to
this Title; J
“(d) ‘Signatory’ means the State of Maryland, the Commonwealth
of Virginia and the District of Columbia;
“ {e} ‘State’ includes District of Columbia;
“(£) ‘Transit facilities’ means all real and personal property located
in the Zone, necessary or useful in rendering transit service between
points within the Zone, by means of rail bus, water or air and any
other mode of travel, including without limitation, tracks, rights of
way, bri tunnels, subwiys, rolling stock for rail, motor vehicle,
marine and air transportation, stations, terminals and ports, areas for
parking and all equipment, fixtures, buildings and structures and
services incidental to or required in connection with the performance
of transit service; :
“(g) ‘Transit. services’ means the transportation of persons and
their and baggage by means of transit facilities between
points within the Zone and includes the a of newspa
express and mail between such ane but does not include taxicab,
sightseein or charter service; an
‘(h) ‘WMATC’ means Washington Metropolitan Area Transit
Commission.
“Articite IT
“PURPOSE AND FUNCTIONS —
“Purpose
“2. The purpose of this Title is to create a regional instrumentality,
as @ common agency of each signatory party, empowered, in the man-
ner hereinafter set forth, (1) to plan, develop, finance and cause to be
operated improved transit facilities, in coordination with transporta-
tion and general development planning for the Zone, as part of a bal-
anced regional system of transportation, utilizing to their best advan-
TT ee
80 Start. ] PUBLIC LAW 89-774—NOV. 6, 1966
“(f) Enter into and perform contracts, leases and agreements with
any person, firm or corporation or with any political subdivision or
agency of any signatory party or with the federal government, or any
agency thereof, including, but not limited to, contracts or agreements
to St) G transit pre age service ; . a wine (oth
reate and abolish offices, employments and positions (other
hens them specifically provided for ea ay as it deems necessary for
the purposes of the Authority, and fix and provide for the qualifica-
tion, appointment, removal, term, tenure, compensation, pension and
retirement rights of its officers and employees without regard to the
laws of any of the signatories; ;
“(h) Establish, in its discretion, a personnel system based on merit
and fitness and, subject to eligibility, participate in the pension and
retirement plans of any signatory, or political subdivision or agency
thereof, upon terms and conditions mutually acceptable ;
* Rt Contract for or employ any professional services ;
“(j) Control and regulate the use of facilities owned or controlled
by the Authority, the service to be rendered and the fares and charges
to be made therefor; : :
“(k) Hold public hearings and conduct investigations relating to
any matter affecting transportation in the Zone with which the Au-
thority is sonmeiel tals in connection therewith, subpena witnesses,
papers, records and documents; or delegate such authority to any
oflicer. Each director may administer oaths or affirmations in any
proceeding or investigation ;
“(1) Make or —— in studies of all phases and forms of trans-
portation, including transportation vehicle research and development
techniques and methods for determining traffic — demand
motivations, and fiscal research and publicize and make available the
results 74 such studies and other information relating to transporta-
tion; an
“(m) Exercise, subject. to the limitations and restrictions herein im-
, all powers reasonably necessary or essentia] to the declared ob-
jects and purposes of this Title.
“ArTicte VI
“PLANNING
“Mass Transit Plan
“13. (a) The Board shal] develop and adopt, and may from time
to time review and revise, a mass transit plan for the immediate and
long-range needs of the Zone. The mass transit plan shall include one
or more plans ans 0) the transit facilities to be provided by
the Authority, including the locations of terminals, stations, plat-
forms, parking facilities and the character and nature thereof; (2) the
design and location of such facilities; (3) whether such facilities are
to be constructed or acquired by lease, purchase or condemnation ; Aye.
a timetable for the provision of such facilities; (5) the anticip
capital costs; (6) estimated operating expenses and revenues relating
thereto; and (7) the various other factors and considerations, which,
in the opinion of the Board, jagity and require the projects therein
proposed. Such plan shall specify the type o Apr pone to be utilized,
the areas to be served, the routes and schedules of service expected to
be provided and the probable fares and charges therefor.
“(b) In pecs the mass transit —_ and in any review of revi-
sion thereof, the Board shall make ful utilization of all data, studies,
reports and information available from the National Capital Trans-
PUBLIC LAW 89-774-NOV. 6, 1966 (80 Srar.
portation Agency and from any other agencies of the federal zovern-
ment, and from signatories and the political subdivisions thereof.
“Planning Process
“14. (a) The mass transit plan, and any revisions, alterations of-
amendments thereof, shall be coordinated, through the procedures
hereinafter set forth, with
“(1) other plans and programs affecting transportation in the
Zone in order to achieve a balanced system of transportation,
utilizing each mode to its best advantage;
“(2) the general plan or plans for the development of the Zone;
and
“(3) the ay og plans of the various political subdivisions
embraced within the Zone.
ai?) It shall be the duty and ey of each member of the
to serve as liaison between the Board and the — which ap-
pointed him to the Board. To provide a framework for regional
participation in the planning process, the Board shall create technica]
committees concerned with planning and collection and analyses
of data relative to nae caer | in the transportation planning
process and the Commissioners of the District of lumbia, the com-
ponent governments of the Northern Virginia Transportation District
and the Washington Suburban Transit District shall appoint represen-
tatives to such technical committees and otherwise cooperate with
the Board in the formulation of a mass transit plan, or in revisions,
alterations or amendments thereof.
“(c) The Board, in the pre aration, revision, alteration or amend-
ment of Pye s eae emg: shall
“(1) consider data with respect to current and prospective con-
ditions in the Zone, including, without limitation, land use, popu-
lation, economic factors a ecting development plans, goals or
objectives for the development of the Zone and the separate politi-
cal subdivisions, transit demands to be generated by such devel-
opment, travel patterns, existing and proposed t rtation and
transit facilities, impact of transit plans on the dislocation of
families and businesses, preservation of the beauty and dignity of
the Nation’s Capital, factors affecting environmental amenities
and aesthetics and financial resources ;
“(2) cooperate with and participate in any continuous, compre-
hensive transportation planning process cooperatively established
by the highway agencies of the signatories and the local political
subdivisions in the Zone to meet the planning standards now or
hereafter prescribed by the Federal-Aid Highway Acts; and
he (3) to the extent a — ent = 3) du — of on
planning process ified in subparagra of this paragrap
(c), pee. bmi with the National Capital Plannin CGianpelesion,
the National Capital Regional Planning Council, the Washington
Metropolitan Council of Governments, the Washington Metro-
rama Area Transit Commission, the highway agencies of the
Signatories, the Maryland-National Capital Park and Planning
Commission, the Northern Virginia Regional Planning and Eco-
f nomic Development Commission, the Maryland State Planning
' ee and the Commission of Fine Arts. Such cooperation
sha dees ype the —, ~ ae ary, = technical committees ~
com of personnel, appoin su cies, concern
with planning and collection and anskvele of data relative to de-
cisionmaking in the transportation planning process.
Di
80 Stat. ] PUBLIC LAW 89-774—NOV. 6, 1966
“Adoption of Mass Transit Plan
“15. (a) Before a mass transit plan is adopted, altered, revised or
amended, the Board shall transmit such EE plan, alteration,
revision or amendment for comment to the following and to such other
agencies as the Board shall determine: ; =
“(1) the Commissioners of the District of re en oe North-
ern Virginia Transportation Commission and the Washington
Suburban Transit Commission ; 1
“(2) the governing bodies of the Counties and Cities embraced
within the Zone;
“(3) the eed agencies of the Signatories;
“(4) the Washington Metropolitan Area Transit Commission ;
“(5) the Washington Metropolitan Council of Governments;
“(6) the Nationa! Capital Planning Commission ;
“(7) The National Capital Regional Planning Council;
“(8) the Maryland-Nationa] Capital Park and Planning Com-
Mission ;
“(9) the Northern Virginia Regional Planning and Economic
Development on;
“(10) the Maryland State Planning Department; and
“(11) the private transit companies operating in the Zone and
the r Unions representing the employees of such companies
and employees of contractors providing service under operating
contracts. :
“Information with respect thereto shall be released to the public.
A copy of the proposed mass transit plan, amendment or revision, shal]
be kept at the office of the Board and shall be available for public in-
spection. After thirty days’ notice published once a week for two
successive weeks in one or more newspa of general circulation
within the Zone, a public hearing shall be held with respect to the pro-
posed = alteration, revision or amendment. The thirty days’
notice shal] — to run on the first day the notice appears in any such
newspaper. The Board shall consider the evidence submitted and
statements and comments made at such hearing and may make any
changes in the pay plan, amendment or revision which it deems
appropriate and such changes may be made without further hearing.
“Arricte VII
“SINANCING
“Policy
“16. With due regard for the policy of Congress for financing a
mass transit plan for the Zone set feuth in Section 204(g) of the Na-
tional Capi Stenageraen a of 1960 (74 Stat. 537), it is hereby
declared to be the policy of this Title that, as far as possible, the pay-
ment of all costs shall be borne by the persons using or benefiting from
the Authority’s facilities and services and any remaining costs shall be
a shared among the federal, District of Columbia and partici-
pating local governments in the Zone. The allocation among such
governments of such remaining costs shal] be determined by agreement
among them and shal] be provided in the manner hereinafter specified.
“Plan of Financing
_ “1%, (a) The Authority, in conformance with said policy, shall pre-
pare and adopt a plan for financing the ern tytn. = a
cn i «a ie ican a
PUBLIC LAW 89-774—NOV. 6, 1966 (80 Srat.
operation of facilities specified in a mass transit plan adopted pursuant
to Article VI hereof, c: in any alteration, revision or amendment
thereof. Such plan of financing shall specify the facilities to be con-
structed or acquired, the cost thereof, the principal amount of revenue
bonds, —— trust certificates, and other evidences of debt pro-
posed to be issued, the principal terms and provisions of al] lomns and
underlying agreements and indentures, estimated operatin expenses
and revenues, and the proposed allocation among the federal, District
of Columbia, and oe local governments of the remaining
costs and deficits, if any, and such other information as the Commis-
sion may consider appropriate.
governments for financia! participation and shall not impose an
igation on any government and such obligations shal] be coontad
only as provided in ion 18 of this Article VII.
“Commitments for Financial Participation
——
“18. (a) Commitments on behalf of the portion of the Zone located
im Virginia shall be by contract or agreement by the Authority with
the Northern Virginia Transportation District, or its component gov-
ernments, as authorized in the Transportation District Act of 1964
(Ch. 631, 1964 Acts of Virginia Assembly), to contribute to the capital
required for the construction and/or acquisition of facilities specified
in & mass transit plan adopted as provided in Article VI, or any altera-
tion, revision or amendment thereof, and for meeting expenses and
obligations ix the operation of such facilities. No such contract or
ee, Sree shall be entered into by the Authority with the
Northern Virginia Transportation District unless said District has
entered into contracts or agreements with its member govern-
ments, as contemplated by Section 1(b) (4) of Article 4 of said Act,
which contracts or agreements at pg rovide that such contracts or
agreements shall inure to the benefit of the Authority and shall be en-
forceable by the Authority in accordance with the provisions of Sec-
tion 2, Article 5 of said Act, and such contracts or agreements are ac-
ceptable tothe Board. The Genera] Assembly of Virginia hereby au-
thorizes and designates the Authority as the agency to plan for and -
provide transit facilities and services for the area of Virginia encom-
within the Zone within the contemplation of Article 1, Section
(c) of said Act.
“(b) Commitments on behalf of the portion of the Zone located
in Maryland shall be by contract or a ent by the Authority with
the Washington Suburban Transit District, pursuant to which the
Authority undertakes to provide transit facilities and service in con-
sideration for the agreement by said District to contribute to the capital
required for the construction and/or acquisition of facilities specified
in & mass transit plan adopted as provided in Article VI, or in any
alteration, revision or amendment thereof, and for meeting expenses
and obligations incurred in the operation of such facilities.
“(c) With respect to the District of Columbia and the federal"
government, the commitment or obligation to render financial assist-
ance shal] be created by appropriation or in such other manner, or by
such other legislation, as the shal] determine. If prior to
. : such my apres! by Pog omc of the egies of Colum-
ja, legislation is enac the Congress granting the governing
body of the District of Columbia plenary aman 3 create obliga-
tions and levy taxes, the commitment by the District of Columbin
shall be by contract or agreement between the governing body of
oP) Such plan oy ancien shall constitute a proposal to the inter-
cia
obl
80 Srar.] PUBLIC LAW 89-774-NOV. 6, 1966
the District of Columbia and the Authority, pursuant to which the
Authority undertakes, subject to the provisions of Section 20 hereof,
to provide transit facilities and service in consideration for the under-
taking by the District of Columbia to contribute to the capital required
for the construction and/or acquisition of facilities specified in a mass
transit plan adepted as provided in Article V1, or in any alteration,
revision or amendment thereof, and for meeting expenses and obliga-
tions incurred in the operation of such facilities.
“Administrative Expenses
“19. Prior to the time the Authority has receipts from appropria-
tions and contracts or agreements as provided in Section 18 of this
Article VII, the expenses of the Authority for administration and
for preparation of a mass transit and financing plan, including all
engineering, financial, legal and other services required in connection
therewith, shall, to the extent funds for such expenses are not pro-
vided through grants by the federal government, be borne by the
District of Columbia, by the Washington Suburban Transit District
and the component governments of the Northern Virginia Transporta-
tion District. Such expenses shall be allocated among such govern-
ments on the basis of population as reflected by the latest available
population statistics of the Bureau of the Census; provided, however,
that upon the request of any Director the Board shall make the alloca-
tion upon estimates of population acceptable to the Board. The allo-
cations shall be made by the Board and shall be included in the annual
current expense budget prepared by the Board.
“Acquisition of Facilities from Federal or Other Agencies
“20. (a) The Authority is authorized to acquire by purchase, lease
or grant or in any manner other than condemnation, from the federal
overnment, or any agency thereof, from the District of Columbia,
Maryland or Virginia, or any political subdivision or agency thereof,
any transit and related facilities, including real and personal prop-
erty and all other assets, located within the Zone, whether in opera-
tion or under construction. Such acquisition shall be made upon such
terms and conditions as may be agreed upon and subject to such au-
thorization or approval by the Congress and the governing body of
the District of one as may be required ; provided, however, that
if such acquisition imposes or may impose any further or additional
obligation or liability upon the Washington eieben Transit Dis-
trict, the Northern Vir inia Transportation District, or any compo-
nent government thereof, under any contract with the Authority, the
Authority shal] not make such acquisition until any such affected
contract has been appropriately amended.
“(b) For such purpose, the Authority is authorized to assume
all liabilities and contracts relating thereto, to assume responsibility
as primary obligor, endorser or guarantor on any outstanding revenue
bonds, equipment trust certificates or other form of indebtedness an-
thorized in this Act issued by such predecessor agency or agencies and,
in connection therewith, to become a party to, and assume the obliga-
tions of, any indenture or loan agreement underlying or issued in con-
nection with any outstanding securities or debts.
“Temporary Borrowing
“21. The Board may borrow, in anticipation of receipts, from any
signatory, the Washington Suburban Transit District, the Northern
PUBLIC LAW 89-774—NOV. 6, 1966 (80 Srar.
Virginia Transportation District, or any component government
thereof, or from any lending institution for any ae page of this Title,
including administrative expenses. Such loans shall be for a term not
be anneal Gus ears and at a rate of interest not to exceed six percent
per annum. ss and any such political subdivision or
agency may, in its discretion, make such loans from~any available
money.
“Funding
“99. The Board shall not construct or acquire any of the transit
facilities specified in a mass transit plan adopted pursuant to the pro-
visions of Article VI of this Title, or in any alteration, revision or
amendment thereof, nor make any commitments or incur any obliga-
tions with respect thereto until funds are available therefor.
“Arricte VIII
“BUDGET
“Capital Budget
“23. The Boord shall annually adopt a capital budget, including
all capital projects it proposes to undertake or continue during the
budget period, wee sot , be statement of the estimated cost of each
project and the method of financing thereof.
“Current Expense Budget
“24. The Board shall ery adopt a current expense budget. for
each fiscal year. Such budget shall include the Board’s estimated ex-
penditures for administration, operation, maintenance and repuirs,
debt service requirements and payments to be made into any unds
required to be maintained. The total of such expenses shall be bal-
anced by the Board's estimated revenues and receipts from all sou
excluding funds included in the capital budget or otherwise earmark
for other purposes.
“Adoption and Distribution of Budgets
“25. (x) Following the adoption by the Board of annual capital
and current expense budgets, the general manager shal] transmit
certified copies of such budgets to the principal budget officer of the
federal government, the District of Columbia, the Washington Subur-
ban Transit District and of the component governments of the North-
ern Virginia Transportation Commission at such time and in such
er as may be required under their respective budgetary pro-
cedures.
“(b) Each budget shall indicate the amounts, if any, required from
the federal government, the Government of the District of Columbia,
the Washington Suburban Transit District and the component gov-
ernments of the Northern Virginia Transportation District, ceter-
mined in accordance with the commitments made pursuant to Article
VII, Section 18 of this Title, to balance ench of said budgets.
“Payments
“26. Subject to such review and approval as may be required by
their budgetary or other applicable processes, the federal government,
the Government of the District of Columbia, the Washington Sub-
80 Star.) PUBLIC LAW 89-774—NOV. 6, 1966
urban Transit District and the component governments of the North-
ern Virginia Transportation District shal] include in their respective
budgets next to be adopted and appropriate or otherwise provide the
amounts certified to each of them as set forth in the budgets.
“Arricte IX =
“REVENUE BONDS
“Borrowing Power
“27. The Authority may borrow money for any of the purposes of
this Title, may ‘issue its negotiable bonds and r evidences of in-
debtedness in respect thereto and may mo or pledge its prop-
=. revenues and contracts as security t or.
. “All such bonds and evidences of indebtedness shall be payable
solely out of the properties and revenues of the Authority. The bonds
and othe¥ obligations of the Authority, except as may be otherwise
rovided in the indenture under which they were issued, shull be
po poy ee ae —— - the full faith and
it of the Authority are — or the prompt payment
of the debt service + and for the lfillment of 1 all er under-
takings of the Authority assumed by it to or for the benefit of the
holders thereof.
“Funds and Expenses
during a period of construction and for a period not to exceed twa
ears thereafter and any incidental expenses (legal, engineering, fiscal
Financial, consultant and other expenses) connected with issuing and
i ing of the bonds; all amounts required for the creation of an
=, construction fund, reserve fund, sinking fund, or other
te Se d; all other expenses connected with administration, the
planning, design, acquisition, construction, completion, improvement
or reconstruction of any. facility or any part thereof; and reimburse-
ment of advances by the Board or by others for such purposes and for
working capital.
“Credit Excluded; om, State, Political Subdivisions and
gencies
“29. The Board shal] have no power to pledge the credit of any sig- ~
pcg: | party, political subdivision or agency thereof, or to impose
an ligation for payment of the bonds upon any signatory party,
political subdivision or agency thereof, but may pledge the contracts
of such governments and agencies; provided, however, that the bonds
may be underwritten in whole or in part as to principal and interest
by the United States, or by any political subdivision or agency of any
signatory ; provided, further, that any bonds underwritten in whole or
in part as to principal and interest by the United States shall not
be issued without approval of the Secretary of the Treasury. Neither
the Directors nor any person executing the bonds shall be liable per-
sonally on the bonds of the Authority or be subject to any personal
liability or accountability by reason of the issuance thereof.
“Funding and Refunding
“30. Whenever the Board deems it expedient, it may fund and
refund the bonds and other obligations of the Authority whether or
PUBLIC LAW 89-774—NOV. 6, 1966 (80 Srar.
bonds at less than their par or face value but no issue of bonds may
be sold at an aggregate price below the par or face value thereof if
such sale would t in a net interest cost to the Authority calculated
upon the entire issue so sold of more than six age per annum pay-
le semiannually, according to standard tables of bond values. <All
bonds issued and sold pursuant to this Title may be sold in such man-
ner, either at public or private sale, as the Board shal] determine.
“Negotiability
“40, All bonds issued under the provisions of this Title are nego-
tinble instruments,
“Bonds Eligible for Investment and Deposit
“41. Bonds issued under the provisions of this Title are hereby
made securities in which rd geory officers and public agencies of the
signatories and their political subdivisions and al] banks, trust com-
panies, savings and loan associations, investment companies and others
carrying on a banking business, al] insurance companies and insurance
associations and others carrying on an insurance business, a]] adminis-
trators, executors, — trustees and other fiduciaries, and all
other persons may legally and properly invest funds, including capital
in their control or belonging to them. Such bonds are hereby made
securities which may properly and legally be deposited with and
received by any officer of any signatory, or of any agency or political
subdivision of any signatory, for any purpose for which the deposit
of bonds or other obligations of such signatory is now or may hereafter
be authorized by law.
“Validation Proceedings
“42. Prior to the issuance of any bonds, the Board may institute
a special proceeding to determine the my ak of proceedings to issue
the bonds and their validity under the laws of any of the signatory
parties. Such sinew. shall be instituted and prosecuted in rem and
the final judgment rendered therein shall be conclusive against all
persons whomsoever and against each of the signatory parties.
“Recording
“43. No indenture need be recorded or filed in any public office, other
than the office of the Board. The pledge of revenues provided in any
indenture shal] take effect forthwith as provided therein and irrespec-
tive of the date of receipt of such revenues by the Board of the in-
denture trustee. Such pl shall be effective as provided in the
indenture without physical delivery of the revenues to the Board or
to the indenture trustee.
“Pledged Revenues
“44. Bond redemption and interest payments shall, to the extent
provided in the resolution or indenture, constitute a first, direct and
exclusive —_ and lien on‘al] revenues received from the use and
operation of the facility, and on any sinking or other funds created
therefrom. All such revenues, together with interest thereon, shal]
constitute a trust fund for the security and payment of such bonds
and except as and to the extent provided in the indenture with re-
80 Start. } PUBLIC LAW 89-774—NOV. 6, 1966
t to the payment therefrom of expenses for other purposes in-
uding administration, operation, maintenance, improvements or ex-
tensions of the facilities or other purposes shal] not be used or pledged
for any other agen so long as such bonds, or any of them, are
outstanding and unpaid.
“Remedies -_
_~
“45. The holder of any bond may for the equal benefit and protection
of all holders of bonds similarly situated: (1) by mandamus or other
ery wee proceedings require and compel the performance of any
- of the duties imposed upon the Board or assumed by it, its officers,
agents or employees under the provisions of any indenture, in con-
nection with the acquisition, construction, operation, maintenance, re-
pair, reconstruction or insurance of the facilities, or in connection
with the collection, deposit, investment, application and disbursement —
of the revenues derived from the operation and use of the facilities, or
in connection with the deposit, investment and disbursement of the
proceeds received from the sale of bonds; or (2) by action or suit in a
court of competent jurisdiction of any signatory party require the
Authority to account as if it were the trustee of an express trust, or
enjoin any acts or things which may be unlawful or in violation of
the rights of the holders of the bonds. The enumeration of such rights
and remedies does not, however, exclude the exercise or prosecution ,
of any other rights or remedies available to the holders of bonds.
“ArTicLe X
“SQUIPMENT TRUST CERTIFICATES
“Power
“46. The Board shall have power to execute agreements, leases and
equipment trust certificates with ay 2 to the purchase of facilities
or equipment such as cars, trolley buses and motor buses, or other
in the form customarily used in such cases and appropriate to
effect such purchase, and may dispose of such equipment trust certifi-
cates in such manner as it may determine to be for the best interests of
the Authority. Each vehicle covered by an equipment trust certificate
shall have the name of the owner or lessor plain 7 marked upon both
sides thereof, followed by the words ‘Owner and Lessor’.
“Payments
“47. All monies required to be paid by the Authority under the
provisions of such © a tomy leases and equipment trust. certificates
shal] be payable solely from the revenue to be derived from the opera-
tion of the transit system or from such a. loans, appropriations or
other revenues, as may be available to the Board under the provisions
of this Title. Payment for such facilities or equipment, or rentals
thereof, may be made in installments, and the deferred installments
may be evidenced by equipment trust, certificates as aforesaid, and title
to such facilities or equipment aoe vest in the Authority until the
equipment trust certificates are pai
“Procedure
“48. The ment to purchase facilities or equipment by the Board
may direct the vendor to sell and assign the equipment to a bank or
| PUBLIC LAW 89-774—NOV. 6, 1966 [80 Star.
;
not such bonds and obligations have matured. It may provide for
the issuance, sale or exchange of refunding bonds for the purpose of
redeeming or retiring any bonds (including the payment of any pre-
mium, duplicate interest or cash adjustment required in connection ,
herewith} issued by the Authority or issued by any other issuing body,
the proceeds of the sale of which have been applied to any facility ac-
quired by the Authority or which are payable out of the revenues of
any faci oe by the Authority. nds may be issued partly
to refund bonds and other obligations then outstanding, and partl
for any other purpose of the Authority. All a iingar of this Title
— to the issuance of bonds are fasae le to refunding bonds
and to the issuance, sale or exchange thereof.
“Bonds; Authorization Generally
_ “31. Bonds and other indebtedness of the Authority shall be author-
ized by resolution of the Board. The validity of the authorization
and issuance of any bonds by the Authority shall not be dependent
upon nor affected in any way by: (i) the disposition of bond proceeds
by the Board or by contract, commitment or action taken with
to such proceeds; or a Se failure to ont any part of the project
for which bonds are authorized to be issued. The Authority may issue
bonds in one or more series and may provide for one or more consoli-
dated bond a principal amounts and with such terms and
provisions as the rd may deem necessary. The bonds may be se-
cured by a pledge of all or yg Buy of the property, revenues and
franchises under its control. ds may be issued by the Authorit
in such amount, with such maturities and in such denominations an
form or forms, whether coupon or registered, as to principal alone or
as to both gore: and inte as may be determined by the Board.
The Board may provide for redemption of bonds prior to maturity
on such notice and at such time or times and with such redemption
provisions, including premiums, as the Board may determine.
“Bonds; Resolutions and Indentures Generally
“39. The Board may determine and enter into indentures or adopt
resolutions providing for the principal amount, date or dates, matu-
rities, interest rate, or rates, denominations, form, registration, trans-
fer, interchange and other provisions of the bonds and coupons and
the terms and conditions u which the same shall be executed, is-
sued, secured, sold, paid, redeemed, funded and refunded. The resolu-
tion of the Board authorizing an bond or any indenture so authorized
under which the bonds are issued may include all such covenants and
other provisions not inconsistent with the provisions of this Title,
other than any restriction on the regulatory powers vested in the
Board by this Title, as the Board may deem necessary or desirable for
tho issue, — security, protection or marketing of the bonds, in-
cluding without limitation covenants and other provisions as to the
rates or amounts of fees, rents and other charges to be charged or
made for use of the facilities; the use, Ligge - nape securing, appli-
cation and disposition of such revenues, of the proceeds of the bonds,
and of any other moneys or contracts of the Authority; the operation,
maintenance, repair and reconstruction of the facilities and the
amounts which may be ided therefor; the sale, lease or other dis-
position of the facilities; the insuring of the facilities and of the reve-
nues derived therefrom; the construction or other acquisition of other
; facilities; the issuance of additional bonds or other indebtedness; the
; rights of the bondholders and of any trustee for the bondholders upon
80 Star. ] PUBLIC LAW 89-774—NOV. 6, 1966
default by the Authority or otherwise; and the modification of the
provisions of the indenture and of the bonds. Reference on the face
of the bonds to such resolution or indenture by its date of adoption
or the apparent date on the face thereof is sufficient to incorporate al]
of the provisions thereof and of this Title into the body of the bonds
and their appurtenant pte er Each taker and subsequent holder OF
the bonds or cou whether the coupons are attached to or detached
from the bonds, has recourse to all of the provisions of the indenture
and of this Title and is bound thereby.
“Maximum Maturity
“33. No bond or its terms shall mature in more than fifty years from
its own date and in the event any authorized issue is divided into two
or more series or divisions, the maximum maturity date herein author-
ized shall be calculated from the date on the face of each bond sepa-
rately, i ive of the fact that different dates may be prescri
for thebon of each separate series or division of any authorized
ISSUE.
“Tax Exemption
“34. All bonds and all other evidences of debt issued by the Author-
ity under the stp po of this Title and the interest thereon shall
at all times be free and exempt from all taxation by or under authority
of any signatory parties, except for transfer, tance and estate
taxes.
“Interest
“35. Bonds shall bear interest at a rate of not to exceed six percent
per annum, payable annually or semiannually.
“Place of Payment
“36. The Board may provide for the payment of the principal and
interest of bonds at any place or places within or without the signa-
tory states, and in any specified lawful coin or currency of the United
States of America. ;
“Execution
“37. The Board may provide for the execution and authentication
of bonds by the manual, lithographed or — facsimile signature
of members of the Board, and by additional! authentication by n trustee
or fiscal agent appointed by the Board; provided, however, that one ~
of such signatures shal] be manual. If any of the members whose
signatures or rg an sg appear upon the bonds or coupons
cease to be members before the delivery of the bonds or coupons, their
‘signatures or countersignatures are nevertheless valid and of the same
force and effect as if the members had remained in office until the
delivery of the bonds and coupons.
“Holding Own Bonds
“38. The Board shall have power out of any funds available therefor
to purchase its bonds and may hold, cancel or resell such bonds.
“Sale
“39. The Board may fix terms and conditions for the sale or other
disposition of any authorized issue of bonds. The Board may sel]
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PUBLIC LAW 89-774—NOV. 6, 1966 (80 Stat.
trust company, duly authorized to transact business in any of the
signatory States, or to the Housing and Homo Finance Administrator,
as trustee, lessor or vendor, for the benefit and security of the —
ment trust certificates and may direct the trustee to deliver the facili-
ties and equipment to one or more designated officers of the Board and
may authorize the trustee simultaneously therewitif=to execute and
deliver a lease of the facilities or equipment to the Board.
“Agreements and Leases
“49, The agreements and leases shall be duly acknowledged before
some person authorized by law to take acknowledgements of deeds
and in the form required for acknowledgement o deeds and such
agreements, | and equipment trust certificates shall be authorized
by resolution of the Board and shall contain such covenants, condi-
tions and provisions as may be deemed necessary or appropriate to
insure the payment of the equipment trust certificates from the reve-
= Snag be aexived from the operation of the transit system and other
“The covenants, conditions and provisions of the agreements, leases
and equipment trust certificates shall not conflict with any of the
provisions of any resolution or trust ae securing the payment,
of bonds or other obligations of the uthority then outstanding or
conflict with or be in derogation of the rights of the holders of any such
bonds or other obligations.
“Law Governing
“50, The equipment trust certificates issued hereunder shall be gov-
erned by Laws of the District of Columbia and for this pyrpose the
Columbia.
“ArticLe XI
“opERATION OF FACILITIES
“Operation by Contract or Lease
“51, The Authority shall not perform transit service, nor any of
the functions, such as maintenance of equipment and right of way
normally associated with the roviding of such service, with any transit
facilities owned or controlled by it but shall provide for the perform-
ance of transit service with such facilities by contract or contracts with
rivate transit companies, private railroads, or other persons. Any
acilities and ae owned or controlled by the Authority, other
than those utilized in orming transit service, may be operated by
the Authority or y others pursuant to contract or Jense as the Iioa
may determine. All operations of such facilities and properties by
the Authority and by its Contractor and lessees shal] be within the
“The Operating Contract
“59. Without limitation upon the right of the Board to prescribe
such additional terms and provisions as it may deem necessary and
appro riate, the operating contract shall;
(a) specify the services and functions to be performed by the
Contractor ;
Zone.
80 Stat. ] PUBLIC LAW 89-774—NOV. 6, 1966
“(b) provide that the Contractor shall hire, supervise and control
personnel required to perform the services and functions assumed
by it under ‘the operating contract and that all such personnel shall be
employees of the Contractor and not of the Authority;
(c) require the Contractor to assume the obligations of the labor
contract or contracts of any transit company which may be acquired
by the Authority and assume the pension obligations of any such
transit company ;
“(d) require the Contractor to comply in all respects with the labor
policy set forth in Article XIV of this Title;
“(e) provide that no transfer of ownership of the capital stock, se-
curities or interests in any Contractor, whose principal business is the
se ya contract, shall be made without written approval of the
d and the certificates or other instruments representing such stock,
securities or interests shall contain a statement of this restriction;
“(£) provide that the Board shall have the sole authority to deter-
mine the rates or fares to be charged, the routes to be operated and the
service to be furnished ;
* (s) a the obligations and liabilities which are to be assumed
by oa ntractor and those which are to be the responsibility of the
uthority ;
“(h) provide for an annual audit of the books and accounts of the
Contractor by an independent certified public accountant to be se-
lected by the Board and for such other audits, examinations and in-
vestigations of the books and records, procedures and affairs of the
Contractor at such times and in such manner as the Board shall require,
the cost of such audits, examinations and investigations to be borne as
agreed by the parties in the operating contract; and
“(i) provide that no operating contract shall be entered into for a
term in excess of five years; provided, that any such contract may be
renewed for successive terms, each of which shall not exceed five years.
Any such operating contract shall be subject to termination by the
Board for cause only.
“Compensation for Contractor
“53. Compensation to the Contractor-under the a contract.
may, in the discretion of the Board, be in the form of (1) a fee = by
the Board to the Contractor for services, (2) a payment by the Con-
tractor to the Board for the right to operate the system, or (2) such
other arrangement as the Board may prescribe; rovided, however,
that the compensation shall bear a reasonable relationship to the bene-
fits to the Authority and to the estimated costs the Authority would
incur in directly performing the functions and duties delegated under
the operating contract; and provided, further, that no such contract
shall create any right in the Contractor (1) to make or change any rate
or fare or alter or cha the service specified in the contract to be
provided or (2) to seek judicial relief by any form of original action,
review or other proceedings from any rate or fare or service prescribed
by the Board. Any assertion, or attempted assertion, by the Contrac-
tor of the right to make or change any rate or fare or service prescribed
by the Board shall constitute cause for termination of the operating
contract. The operating contract may provide incentives for efficient
and economical management.
“Selection of Contractor
“54. The Board shall enter into an operating contract only after
formal advertisement and negotiations with all interested and quali-
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PUBLIC LAW 89-774—-NOV. 6, 1966 [80 Srar.
fied parties, including private transit companies rendering transit
service within the Zone; —— however, that, if the Authority
acquires transit facilities from any agency of the federal or District
of Columbia governments, in accordance with the provisions of Article
VII, Section 20 of this Title, the Authority assfime the obliga-
tions of any operating contract which the transferor agency may
have entered into.
“Arricte XII
“COORDINATION OF PRIVATE AND PUBLIC FACILITIES
“Declaration of Policy
“55. It is hereby declared that the interest of the public in efficient
and economical transit service and in the financial well-being of the
«\uthority and of the private transit companies requires that the public
und private segments of the regional transit system be operated, to the
fullest extent possible, as a coordinated system without unnecessary
duplicating service.
“Implementation of Policy
“56. In order to carry out the legislative policy set forth in Section
55 of this Article XII
“(a) The Authority—
“(1) except as herein provided, shall not, directly or through a
Contractor, perform transit service by bus or similar motor
vehicles ;
(2) shall, in cooperation with the private carriers and
WMATC, coordinate to the fullest extent practicable, the sched-
ules for service performed by its facilities with the schedules
for service — by private carriers; and
“(3) shall enter into a ents with the private carriers to
establish and maintain, subject to approval by WMATC, through
routes and joint fares and provide for the division thereof, or, in
the absence of such agreements, establish and maintain through
routes and joint fares in accordance with orders issued y
WMATC directed to the private carriers when the terms an
conditions for such through service and joint fares are acceptable
to it.
“(b) The WMATC, upon application, complaint, or upon its own
motion, shall—
“(1) direct private carriers to coordinate their schedules for
service with the schedules for service performed by facilities owned
or controlled by the Authority ;
“(2) direct private carriers to improve or extend any existing
services or provide additional service over additional routes;
“(3) authorize a private carrier, pursuant to agreement bet ween
said carrier and the Authority, to establish and maintain through
routes and joint fares for transportation to be rendered with fa-
cilities owned or controlled by the Authority if, after hearing held
upon reasonable notice, WMATC finds that such through routes
and joint fares are required by the public interest ; and :
“(4) in the absence of such an agreement with the Authority, di-
rect a private carrier to establish and maintain ge routes and
joint fares with the Authority, if, after hearing held upon rea-
sonable notice, WMATC finds that such through service and joint
80 Srat.] PUBLIC LAW 89-774—NOV. 6, 1966
fares are required by the public interest ; provided, however, that
no such order, rule or regulation of WMATC shall be construed
to require the Authority to establish and maintain any through
route and joint fare. ;
“(c) WMATC shall not authorize or require a private carrijgr to
render any service, including the establishment or continuation of a
joint fare for a through route service with the Authority which is
Canad on a division thereof between the Authority and private carrier
which does not provide a reasonable return to the private carrier,
unless the carrier is currently earning a reasonable return on its
operation as a whole in performing transportation subject to the
jurisdiction of WMATC. In determining the issue of reasonable
return, WMATC shall take into account any income attributable to
the carrier, or to any corporation, firm or association owned in whole
or in part by the carrier, from the Authority whether by way of pay-
ment for services or otherwise,
“(d) If the WMATC is unable, through the exercise of its regula-
tory powers over the private carriers granted in paragraph (b) hereof
or otherwise, to bring about the requisite coordination of operations
and service between the private carriers and the Authority, the Au-
thority may in the situations specified in paragraph (b) hereof, cause
such transit service to be rendered by its Contractor by bus or other
motor vehicle, as it shal] deem necessary to effectuate the policy set
forth in Section 55 hereof. In any such situation, the Authority in
order to encourage private carriers to render bus service to the fullest
extent practicable, may, pursuant to agreement, make reasonable sub-
sidy payments to any private carrier.
“Rights of Private Carriers Unaffected
“57. Nothing in this Title shall restrict or limit such rights and
remedies, if any, that any private carrier may have against the Au-
thority arising out of acts done or actions taken by the Authorit
hereunder. In the event any court of competent jurisdiction shall
determine that the Authority has unlawfully infringed any rights of
any private carrier or otherwise caused or permitted any private
carrier to suffer legally cognizable injury, damages or harm and shall
award a judgment therefor, such judgment shall constitute a lien
against any and all of the assets aad properties of the Authority.
“Financial Assistance to Private Carriers
“58. (a) The Board may accept grants from and enter into loan
agreements with the Housing and Home Finance Administrator, pur-
suant to the provisions of the Urban Mass Transportation Act of 1964
(78 Stat. 302), or with any successor agency or under any law of
similar purport, for the purpose of rendering financial assistance to
private carriers.
“(b) An application by the Board for any such grant or loan shall
be based on and supported by a report from WMATC setting forth
for each private carrier to be assisted (1) the equipment and facili-
ties to be acquired, constructed, reconstructed, or improved, (2) the
service proposed to be rendered by such equipment and facilities, (3)
the improvement in service ay te from such facilities and equip-
ment, (4) how the use of such facilities and equipment will be coordi-
nated with the transit facilities owned by the Authority, (5) the
49 USC 160!
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PUBLIC LAW 89-774—NOV. 6, 1966 [80 Star.
ability of the affected private carrier to repay any such loans or grants
and (6) recommend terms for any such 6 Bo or grants.
“(¢) Any equipment or facilities acquired, constructe*. recon-
structed or improved with the proceeds of such grants or sce" ~-all
be owned by the Authority and may be made available to private
carriers only by lease or other agreement which contain provisions
acceptable to the Housing and Home Finance Administrator assuring
that the Authority will have satisfactory continuing control over the
use of such facilities and equipment.
“ArTICcLE XIII
“SORISDICTION ; RATES AND SERVICE
“Washington Metropolitan Area Transit Commission
“59 Except as provided herein, this Title shall not affect. the func-
tions-and jurisdiction of WMATC, as granted by Titles I and IT of this
Compact, over the transportation therein specified and the persons
engaged therein and the Authority shall have no jurisdiction with
respect thereto.
“Public Facilities
“60. Service performed by transit facilities owned or controlled by
the Authority, and the rates and fares to be charged for such service,
shall be subject to the sole and exclusive jurisdiction of the Board and,
notwithstanding any other provision in this Compact contained.
WMATC shall have no authority with respect thereto, or with respect
to any contractor in connection with the operation by it. of transit
facilities owned or controlled by the Authority. The determinations
of the Board with respect to such matters shall not be subject to
judicial review nor to the processes of any court.
“Standards
“61, Insofar as practicable, and consistent with the provision of ade-
quate service at reasonable fares, the rates and fares and service shall
be fixed by the Board so as to result in revenues which will:
“(a) pay the operating expenses and provide for repairs, mainte-
nance and depreciation of the transit system owned or controlled by
the Authority ;
“(b) provide for payment of all principal and interest on outstand-
ing revenue bonds and other obligations and for payment. of all
amounts to sinking funds and other funds as may be required by the
terms of any indenture or loan agreement;
“(c) provide for the purchase, lease or acquisition of rolling stock,
including provisions for interest, sinking funds, reserve funds, or other
funds required for payment of any obligations incurred by the Au-
thority for the acquisition of rolling stock ; and
Bie! provide funds for any purpose the Board deems necessary and
desirable to carry out the purposes of this Title.
“Hearings
“62. (a) The Board shall not make or change any fare or rate, nor
establish or abandon any service except after holding a public hearing
with respect thereto.
80 Star. ] PUBLIC LAW 89-774—NOV. 6, 1966
“(b) Any signatory, any political subdivision thereof, any agency
of the federal government and any m, firm or association served
by or using the transit facilities of the uthority.and any private
carrier may file a request with the Board for a hearing with respect to
any rates or charges made by the Board or any service rendered with
the facilities owned or controlled by the Authority. Such request
shall be in writing, shall state the matter on which a hearing is re-
quested and shall set forth clearly the matters and things on which the
request relies. As promptly as — after such a request is filed,
the Board, or such officer or employee as it may designate, shall confer
with the protestant with respect to the matters complained of. After
such conference, the Board, if it deems the matter meritorious and of
genera] significance, may call a hearing with respect to such request.
. “(c) The Board shall give at least thirty cays’ notice for all hear-
ings. The notice shall be given by publication in a newspaper of daily
circulation throughout the Zone and such notice shall be published
once & week-for two successive weeks. The notice shall start with the
day of first publication. In addition, the Board shall post notices of
the hearing in its offices, all stations and terminals, and in all of its
vehicles and rolling stock in revenue service.
Ba Prior to calling a epics on any matter specified in this sec-
tion, the Board shall prepare and file at its main office and keep open
for public inspection its report relating to the proposed action to be
considered at such hearing. Upon receipt by the Board of any report
submitted by WMATC, in connection with a matter set for hearing,
ursuant to the provisions of Section 63 of this Article XIII, the
oard shall file such report at its main office and make it available for
public inspection. For heari called by the Board pursuant to
paragraph (b), above, the Board also shall cause to be lodged and kept
open for public inspection the written request upon which the hearing
is granted and all documents filed in support thereof.
“Reference of Matters to WMATC
“63. To facilitate the attainment of the public policy —— for
operation of the publicly and Bg ves owned or controlled transit
facilities as stated in Article XII, Section 55, prior to the hearings
provided for by Section 62 hereof— : : :
“(a) The Board shall refer to WMATC for its consideration and
recommendations, any matter which the Board considers may affect
the operation of the publicly and privately owned or controlled transit
facilities as a coordinated regional transit system and any matter for
which the Board has called a hearing, pursuant to Section 62 of this
Article XIII, except that tem — or emergency changes in matters
affecting service shall not be referred ; and ; :
“(b) SWMATC, upon such reference of any matter to ang ve
the referred matter preference over any other matters pending before
it and shall, as expeditiously as practicable, prepare and transmit its
report thereon to the Board. 1e Board may request WMATC to
reconsider any part of its report or to make ay aceeren reports
it deems necessary. All of such reports shall] be advisory only.
“(c) Any report submitted by ATC to the Board shall con-
sider, without limitation, the probable effect of the matter or pro-
posal upon the operation of the publicly and privately owned or con-
trolled transit facilities as a coordinated regional system, passenger
movements, fare structures, service and the impact on the revenues of
both the public and private facilities.
bie ek WR Ba MR Ha her ecb RE
PUBLIC LAW 89-774—NOV. 6, 1966 [80 Srar.
“ArricLe XIV
“LABOR POLICY
“Construction
“64. The Board shal] take such action as may be necessary to insure
that all laborers and mechanics employed by contractors or subcon-
tractors in the construction, alteration or repair, including painting
and decorating, of projects, buildings and works which are undertaken
by the Authority or are financially assisted by it, shall be paid w
at rates not less than those prevailing on similar construction in the
locality as determined by the Secretary of Labor in accordance with
the Davis-Bacon Act, as amended (40 U.S.C. 276a—276a-5), and every
such employee shall] receive compensation at a rate not Jess than one
and one-half times his basic rate of pay for all hours worked in any
workweek in excess of eight hours in any workday or forty hours in any
workweek, as the casemay be. A provision stating the minimum wages
thus determined and the requirement that overtime be pnid as above
provided shall be set out in each Le advertisement. for bids and
in each bid proposal form and shall be made a part of the contract
pepe ben project, which contract shal] be deemed to be a contract
of the cter ified in Section 103 of the Contract Work Hours
Standards Act (76 Stat. neil as now or as may hereafter be in effect.
The Secretary of Labor shall have, with respect to the administration
and enforcement of the labor standards specified in this provision, the
supervisory, oe and other authority and functions set forth
in tion Plan Number 14 of 1950 (15 F.R. 3176, 64 Stat.
1267, 5 U.S.C. 1832-15), and section 2 of the Act of June 13, 1934, as
amended (48 Stat. 948, as amended; 40 U.S.C. 276(c)). The require-
ments of this section shall also be applicable with respect to the em-
ployment of laborers and mechanics in the construction, alteration or
repair, including painting and decorating, of the transit facilities
owned or controlled by the Authority where such activities are per-
—— a Contractor pursuant to agreement with the operator of
such facilities.
“Equipment and Supplies
“65. Contracts for the manufacture or furnishing of materials
—_ lies, articles and equipment sha! be subject to the provisions of
the
alsh-Healey Public Contracts .\ct. (41 U.S.C. 35 et seq.), as now
or as may hereafter be in effect.
“Operations
“66. It shall be a condition of the operation of the transit facilities
owned or controlled by the Authority that the provisions of section
10(c) of the Urban Transportation Act of 1964 (49 U.S.C.
1609(c) ) shall be applicable to any contract or other arrangement for
the operation of such facilities.
“ARTICLE XV
“RELOCATION ASSISTANCE
“Relocation Program and Payments
“67. Section 7 of the Urban Mass Transportation Act of 1964, and
as the same may from time to time be amended, and al! ne
promulgated thereunder, are hereby made applicable to individuals,
eae PE En OT SI LITE EN
80 Start. } PUBLIC LAW 89-774—NOV. 6, 1966
families, business concerns and nonprofit organizations displaced from
real property by actions of the Authority without regard to whether
financial assistance is sought by or extended to the Authority under any
provision of that Act; provided, however, that in the event real prop-
erty is acquired for the Authority by an agency of the federal govern-
ment, or by a State or Jocal agency or instrumentality, the Authority
is authorized to reimburse the acquiring agency for relocation pay-
ments made by it.
“Relocation of Public or Public Utility Facilities
“68. Notwithstanding the provisions of Section 67 of this article
XV, any highway or other public facility or any facilities of a public
utility company which will be dislocated by reason of a project deemed
necessary by the Board to effectuate the authorized purposes of this
Title shall be relocated if such facilities are devoted to a public use, and
the reasonable cost of relocation, if substitute facilities are necessary,
shall be paid by the Board from any of its monies.
“ARTICLE XVI
“GENERAL PROVISIONS
“Creation and Administration of Funds
“69. (a) The Board may provide for the creation and administra-
tion of such funds as may be required. The funds shall be disbursed
in accordance with rules established by the Board and all payments
from any fund shal] be reported to the Board. Monies in such funds
and other monies of the Authority shall be deposited, as directed by
the Board, in any state or national bank located in the Zone having
n total paid-in capital of at least one million dollars ($1,000,000).
The trust department of any such state or national bank may be ag 2
nated asa eee to receive any securities acquired or owned by the
Authority. The restriction with respect to paid-in capital may be
waived for any such bank which agrees to pledge federal securities to
protect. the funds and securities of the Authority in such amounts
and ye to such arrangements as may be acceptable to the Board.
“(b) Any monies of the Authority may, in the discretion of the
Board and subject to any agreement or covenant between the Au-
thority and the holders of any of its obligations limiting or restricting
classes of investments, be invested in bonds or other obligations of, or
aranteed as to interest and principal by, the United States, Mury-
and, Virginia or the political sulalivisions or agencies thereof.
“Annual Independent Audit
“70. (a) As soon as practical after the closing of the fiscal year, an
audit shall be made of the financial accounts of the Authority. The
audit shall be made by qualified certified public accountants selected
by the Board, who shall have no personal interest direct or indirect in
e financial affairs of the Authority or any of its officers or employees.
The report of audit shal] be prepared in accordence with generally
accepted auditing principles and shall be filed with the Chairman and
other officers as the Board shall direct. Copies of the report sha’’ be
distributed to ench Director, to the Congress, to the Board of Com-
missioners of the District of Columbia, to the Governors of Virginia
and Maryland, to the Washington Suburban Transit Commission, to
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PUBLIC LAW 89-774—NOV. 6, 1966 {80 Srar.
the Northern Virginia Transportation Commission and to the govern-
ing bodies of the political subdivisions located within the Zone which
are parties to commitments for participation in the financing of the
Authority and shall be made available for public distribution.
“(b) The financial transactions of the Board aliall be subject. to audit
by the United States General Accounting Office in accordance with
the principles and procedures applicable to commercial corporate trans-
actions and under such rules and regulations as may be prescribed by
oe ee General of the United States. The audit. shall be
— at the place or places where the accounts of the Board are
ept.
Ei (c) Any Director, officer or employee who shall refuse to give all
required assistance and information to the accountants selected by the
Board or who shall refuse to submit to them for examination such
books, documents, records, sage accounts, papers, things or property
may be requested shall, in the discretion of the Board forfeit his
office.
Ms “Reports
“71. The Board shall make and publish an annual report on its pro-
grams, operations and finances, which shall be distributed in the same
manner provided by Section 70 of this Article XVI for the report of
annual audit. It may also prepare, publish and distribute suc other
public reports and informational materials as it may deem necessary or
esirable.
“Insurance
“72. The Board may self-insure or purchase insurance and pay the
premiums therefore against loss or damage to any of its properties ;
against liability for injury to persons or property ; and against loss o
revenue from any cause whatsoever. Such insurance covernge shall
be in such form and amount as the Board may determine, subject to
the ore of any agreement arising out of issuance of bonds or
other obligations by the Authority.
“Purchasing
“73 Contracts for the construction, reconstruction or improvement
of any facility when the expenditure required exceeds ten thousand
dollars ($10,000) and contracts for the purchase of supplies, equip-
ment and materials when the expenditure required ex two thou-
sand five hundred dollars ($2,500) shall be advertised and let-upon
sealed bids to the lowest responsible bidder. Notice requesting such
bids shall be published in a manner reasonably likely to attract pro-
spective bidders, which publication shall be made at Jeast ten days
before bids are received and in at least two newspapers of general
circulation in the Zone. The Board may reject any and all bids and
readvertise in its discretion. If after rejecting bids the Board deter-
mines and resolves that, in its opinion, the supplies, equipment and
materials may be purchased at a lower price in the open market, the
Board may give each responsible bidder an opportunity to negtiate
a price and may proceed to purchase the supplies, equipment anu ma-
terials in the open market at a negotiated price which is lower than
the lowest rejected bid of a responsible bidder, without. further observ-
ance of the provisions requiring bids or notice. | The Board shall
adopt rules and regulations to provid~ for purchasing from the lowest
responsible bidder when sealed bids, notice and publication are not
80 Start. ] PUBLIC LAW 89-774-—NOV. 6, 1966
required by this section. The Board may suspend and waive the pro-
visions of this section requiring competitive eds sianoer :
“(a) the purchase is to be made n or the contract is to be made
with the federal or any State government or any agency or political
subdivision thereof or pursuant to any open end bulk purchasg con-
tract of any of them; sh
Be (>) the public exigency requires the immediate delivery of the
articles;
" c) only one source of supply is available; or
“(d) the equipment to be purchased is of a technical nature and the
procurement thereof without advertising is necessary in order to assure
standardization of equipment and interchangeability of parts in the
public interest.
“Rights of Way
“74. The Board is authorized to locate, construct and maintain any
of its transit and related facilities in, upon, over, under or across any
streets, highways, freeways, bridges and any other vehicular facilities,
subject to the applicable Jaws governing such use of such facilities by
ublicagencies. In the absence of such laws, such use of such facilities
y the Board shall be subject to such reasonable conditions as the high-
way departinent or other affected agency of a signatory party mny re-
quire; provided, however, that the shal] not construct or operate
transit or related facilities upon, over, or across any parkways or park
lands without the consent of, and except upon the terms and conditions
required by, the agency having jurisdiction with respect to such park-
ways and park lands, but may construct or operate such facilities in a
subway under such parkways or Fe rk lands upon such reasonable terms
and conditions as may be specified by the agency having jurisdiction
with respect thereto.
“Compliance with Laws, Regulations and Ordinances
“75. The Board shal] comply with all laws, ordinances and regula-
tions of the signatories and political subdivisions and agencies thereof
with respect to use of streets, highways and al] other vehicular facili-
ties, ¢ control and regulation, zoning, signs and buildings.
“Police
“76. The Board is authorized to employ watchmen, guards and in-
vestigators as it may deem necessary for the protection of its proper-
ties, personnel and passengers and such employees, when authorized by
any Jurisdiction within the Zone, may serve as special police officers in
any such jurisdiction. Nothing contained herein shall reliove any
signatory or political subdivision or agency thereof from its duty to
provide police service and protection or to limit, restrict or interfere
with the jurisdiction of or performance of duties by the existing police *
and law enforcement agencies.
“Exemption from Regulation
“77. Except as otherwise provided in this Title, any transit serv-
ice rendered by transit facilities owned or controlled by the Authority
and the Authority or any corporation, firm or association performing
such transit service pursuant to an operating contract with the Author-
ity, shall, in connection with the performance of such service, be ex-
empt from all laws, rules, regulations and orders of the signatories
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PUBLIC LAW 89-774—NO™’. 6, 1966 (80 Star.
and of the United States otherwise applicable to such transit service
and persons, except that laws, rules, regulations and orders relating
to inspection of equipment and facilities, safety and testing shall re-
main in force and eflect; provided, however, that the Board may pro-
mulgate regulations for the safety of the public and employees not
inco~ sistent with the applicable laws, rules, regulations or orders of the
signatories and of the United States.
“Tax Exemption
“78. It is hereby declared that tlie creation of the Authority and
the carrying out of the corporate purposes of the -\uthority is in all
respects for the benefit of the people of the signatory states and is for
a public purpose and that the Authority and the Board will be per-
forming an essential governmental function, including, without limita-
tion, agen” governmental and other furctions, in the exercise of
the powers conferred by this Title. Accordingly, the Authority and
the rd shali-not be required to pay taxes or assessments upon any
of the property acquired by it or under its jurisdiction, control, pos-
session or supervision or upon its activities in the operation and main-
tenance of any transit facilities or upon any revenues therefrom and
the property and income derived therefrom shall be exempt from all
federal, State, District of Columbia, municipal and local taxation.
This exemption shall include, without limitation, all motor vehicle
license fees, sales taxes and motor fuel taxes.
“Free Transportation and School Fares
“79, All laws of the signatories with respect to free transportation
and school fares shall be applicable to transit service rendered by
facilities owned or controlled by the Authority». .
“Liability for Contracts and Torts
“g0. The Authority shall be linble for its contracts and for its torts
and those of its Directors, officers, employees and agent committed in
the conduct of any proprietary function, in accordance with the law of
the applicable signatory (including rules on conflict of laws), but shall
not be liable for any torts occurring in the performance of 2 govern-
mental function. The exclusive wget for such breach of contracts
and torts for which the Authority shall be liable, as herein provided,
shall be by suit against the Authority. Nothing contained in this
Title shall be construed as a waiver by the District. of Columbia, Mary-
land, Virginia ‘and the counties and cities within the Zone of any
immunity from suit.
“Jurisdiction of Courts
“g1. The United States District Courts shall have original juris-
diction, concurrent with the Courts of Maryland and Virginia, of al!
actions brought. by or against. the Authority and to enforce subpoenas
issued under this Title. Any such action initiated in a State Court
shal! be removable to the appropriate United States District Court
in the manner provided by Act of June 25, 1948, as amended (28
U.S.C. 1446).
“Condemnation
“g2. (x) The Authority shall have the power to acquire by con-
demnation, whenever in its opinion it is necessary or advantageous
to the Authority to do so, any real or personal property, or any in-
80 Srat.] PUBLIC LAW 89-774—NOV. 6, 1966
terest therein, necessary or useful for the transit system authorized
herein, except property owned by the United States, by a signatory,
or any political subdivision thereof, or by a private transit. com-
“b) Proceedings for the condemnation of property in the,Dis-
trict of Columbia shall be instituted and maintained under the Act
of December 23, 1963 (77 Stat. 577-581, D, C. Code 1961, Supp. IV,
Sections 1851-1368). Proceedings for the condemnation of propert
located elsewhere within the Zone shal] be instituted and maintained,
if applicable, pursuant. to the provisions of the Act of August. 1, 1888,
as amended (25. Stat. 357, 40 U.S.C. 257) and the Act of June 25,
1948 (62 Stat. 935 and 937, 28 U.S.C. 1858 and 1403) or any other
— Act; provided, however, that if there is no applicable
eral law, condemnation proceedings shall be in accordance with
the provisions of the State law of the vy ag | in which the prop-
oy is located governing condemnation by the highway agency of
such state. Whenever the words ‘real property,’ ‘realty,’ ‘land,’ ‘ease-
merit,’ ‘right-of-way,’ or words of similar meaning are used in an
applicable federal or state law relating to procedure, jurisdiction an
venue, they shall be deemed, for the purposes of this Title, to include
any nal property authorized to be acquired hereunder.
cy Any award or compensation for the taking of property pur-
svant to this Title shall be paid by the Authority, and none of the
signatory parties nor any other agency, instrumentality or political
subdivision thereof shall be liable for such award or compensation.
“Enlargement and Withdrawal; Duration
“83. (a) When advised in writing by the Northern Virginia Trans-
portation Commission or the Washington Suburban Transit Com-
mission that the geographical area embraced therein has been en-
larged, the Board, upon such terms and conditions as it may’ deem
appropriate, shall by resolution enlarge the Zone to embrace the addi-
tional area.
“(b) The duration of this Title shall] be perpetual but any signa-
tory thereto may withdraw therefrom upon two years’ written notice
to the Board.
“(c) The withdrawal of any signatory shall] not relieve such sig-
natory, any transportation district, county or city or other political
subdivision thereof from any obligation to the Authority, or inuring
to the benefit of the Authority, created by contract or otherwise.
“Amendments and Supplements
“84. Amendments and supplements to this Title to implement the
purposes thereof may be adopted Wy legislative action of any of the
signatory parties concurred in by all of the others.
“Construction and Severability
“85. The provisions of this Title and of the agreements thereunder
shall be severable and if any phrase, clause, sentence or provision of
this Title or any such agreement is declared to be unconstitutional or
the applicability thereof to any signatory party, political subdivision
or agency thereof is held invalid, the constitutionality of the remain-
der of this Title or any such agreement and the applicability thereof
to any other signatory party, political subdivision or agoncy thereof
135)
62 Stat. 986.
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PUBLIC LAW 89-774—NOV. 6, 1966 [80 Sra.
or circumstance shall not be affected thereby. It is the legislative
intent that the provisions of this Title be reasonably and hereily
construed.
“Effective Date; Execution
“86. This Title shal] be adopted by the signatories in the manner
provided by law therefor and shall be signed and sealed in four dupli-
cate original copies. One such copy shall be filed with the Secretary
of State of mek of the signatory parties or in accordance with laws
of the State in which the ating is oe one copy shall be filed
and retained in the archives of the Authority u its organization.
This Title shall become effective ninety days after the enactment of
mei legislation by or on behalf of the District of Columbi
Maryland and Virginia and consent thereto by the Congress and a
other acts or actions have been taken, including the signing and execu-—
tion of the Title by the Governors of Maryland and Virginia and the
Commissioners of the District of Columbia.”
Section 2. The Commissioners of the District of Columbia are au-
thorized and directed to enter into and execute an amendment. to the
Com substantially as set forth above with the States of Virginia
and Maryland and are further authorized and directed to carry out
and effectuate the terms and provisions of snid Title III, and there are
hereby authorized to be appropriated out of District of Columbia
funds such amounts as are necessary to carry out the obligations of the
District of Columbia in accordance with the terms of the said Title III.
Section 3. (a) To assure uninterrupted progress in the development
of the facilit.es authorized by the National Capital Transportation
Act of 1965, the transfer of the functions and duties of the National
Capital Transportation Agency (herein referred to as the Agency) to
the Washington Metropolitan Area Transit Authority (herein re-
ferred to as the Authority) as required by Section 301(b) of the
National Capital Transportation Act of 1960 shal] take place on
Se ber 30, 1967.
b) Upon the effective date of the transfer of functions and duties
authorized by subsection (a) of this section, the President is author-
ized to transfer to the Authority such real and personal property,
studies, reports, records, and other assets and liabilities as are appro-
priate in order that the Authority may assume the functions and duties
of the Agency and, further, the President shall make provision for the
transfer to the Authority of the unexpended balance of the appropria-
tions, and of other funds, of the Agency for use by the Authority but
such unexpended balances so transferred shal] be used only for the
purpose for which such appropriations were a made. Subse-
uent to said effective date, there is authorized to be appropriated to the
partment of Housing and Urban Development, for payment to the
Authority, any unappropriated portion of the authorization specified
in Section 5(a)(1) of National Capital Transportation Act of
1965. There is also authorized to be Se ay to the District of
Columbia out of the general fund of the District of Columbia, for
payment to the Authority, any unap po pee y portion of the au-
thorization specified in section 5(a) (2) of such Act. Any such ap-
propriations shall be used only for the purposes for which such
suthorleations were originally made..
(c) Pending the assumption by the Authority of the functions and
duties of the Agency, the Agency is authorized and directed, in the
manner herein set forth, fully to cooperate with and assist the
Authority, the Northern Virginia Transportation Commission and
the Washington Suburban Transit Commission in the development of
80 Stat.) PUBLIC LAW 89-774—NOV. 6, 1966
plans for the extensions, new lines and related facilities required td
expand the basic system authorized by the National Capital Trans-
portation Act of 1965 into a regional system, but, pending such transfer
of functions and ae in this Act shall be construed to im-
pair the performance by the cy of the functions and duties
im by the National Capital Transportation Act of 1968-
d) In order to provide the cooperation and assistance specified in
subsection (c) of this section, the Agency is authorized to perform,
on a reimbursable basis, planning, engineering and such other services
for the Authority, as the Authority may request, or to obtain such -
services by contract, but al] such assistance and services shall be ren-
dered in accordance with policy determinations made by the Authority
and shall be advisory only.
(e) Amounts received by the Agency from the Authority as pro-
vided in subsection (d) of this section shall be available for expendi-
ture by the A y in performing services for the Authority.
—Section 4. The United States District Courts shall have original
jurisdiction, concurrent with the Courts of Maryland and Virginia,
of all actions brought. by or against the Authority and to enforce sub-
poenas issued pursuant to the provisions of Title III. Any such ac-
tion initiated in a State court shall be removable to the appropriate
United States District Court in the manner provided by the Act of
June 25, 1948, as amended (28 U.S.C. 1446).
Section 5. (a) All laws or parts of laws of the United States and
of the District of (‘olumbia inconsistent with the provisions of Title
III of this Act are hereby amended for the purpose of this Act to the
extent necessary to climinate such inconsistencies and to carry out the
provisions of this Act and Title JII and all laws or parts of laws and
all reorganization plans of the United States are hereby amended and
made applicable for the purpose of this Act to the extent necessary
to carry out the provisions of this Act and Title III.
(b) Section 202 of the National Capital Transportation Act of 1960
(Public Law 86-669, 74 Stat. 537), as amended by Section 7 of the
National ee Transportation Act of 1965 (Public Law 89-173, 79
Stat. 666) is hereby repealed.
Section 6. (a) The right to alter, amend or repeal this Act is hereby
expressly reserved.
(b) The Authority shall submit to Congress and the President
copies of all annual and special reports made to the Governors, the
Commissioners of the District. of Columbia and/or the legislatures of
the compacting States. .
(c) The President. and the Congress or any committee thereof shall
have the right to require the disclosure and furnishing of such in-
formation by the Authority as they may deem appropriate. Further,
the President and Congress or any of its committees shall have access
to all books, records and papers of the Authority as well as the right
of inspection of any facility used, owned, ] , regulated or under
the control of said Authority.
(d) In carrying out the audits ss for in section 70(b) of the
Compact the representatives of the General Accounting Office shall
have access to all ree. accounts, er 2 records, reports, gs ve
all other papers, things, or property belonging to or in use by the
Board nl se Spa te dacilitate the audit, and they shall be afforded
full facilities for verifying transactions with the balances or securities
held by depositories, agents, and custodians.
Approved November 6, 1966.
79 Stat. 663. —
40 USC 681 no
Planning and ©
engineering
services.
Jurisdiction
of courts,
62 Stet. 939;
63 Stat. 101.
Advisory Bos 1
Repeal.
40 USC 662.
Reports to
Congress.
Information,
evallabiility.
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App. 64
THE FEDERALIST NO. 81
A Further View of the Judicial Department in Relation
to the Distribution of Its Authority
by Alexander Hamilton
LET US now return to the partition of the judiciary authority
between different courts, and their relations to each other.
"The judicial power of the United States is" (by the plan of
the convention) "to be vested in one Supreme Court, and in such
inferior courts as the Congress may, from time to time, ordain and
establish."{ 1}
That there ought to be one court of supreme and final
jurisdiction, is a proposition which is not likely to be contested. The
reasons have been assigned in another place, and are too obvious to
need repetition. The only question that seems to have been raised
concerning it, is, whether it ought to be a distinct body or a branch of
the legislature. The same contradiction is observable in regard to
this matter which has been remarked in several other cases. The very
men who object to the Senate as a court of impeachments, on the
ground of an improper intermixture of powers, advocate, by
implication at least, the propriety of vesting the ultimate decision of
all causes, in the whole or in a part of the legislative body.
The arguments, or rather suggestions, upon which this charge
is founded, are to this effect: "The authority of the proposed
Supreme Court of the United States, which is to be a separate and
independent body, will be superior to that of the legislature. The
power of construing the laws according to the spirit of the
Constitution, will enable that court to mold them into whatever shape
it may think proper; especially as its decisions will not be in any
manner subject to the revision or correction of the legislative body.
This is as unprecedented as it is dangerous. In Britain, the judicial
power, in the last resort, resides in the House of Lords, which is a
branch of the legislature; and this part of the British g>vernment has
been imitated in the State constitutions in general. The Parliament of
App. 65
Great Britain, and the legislatures of the several States, can at any
time rectify, by law, the exceptionable decisions of their respective
courts. But the errors and usurpations of the Supreme Court of the
United States will be uncontrollable and remediless." This, upon
examination, will be found to be made up altogether of false
reasoning upon misconceived fact.
In the first place, there is not a syllable in the plan under
consideration which directly empowers the national courts to
construe the laws according to the spirit of the Constitution, or which
gives them any greater latitude in this respect than may be claimed
by the courts of every State. I admit, however, that the Constitution
ought to be the standard of construction for the laws, and that
wherever there is an evident opposition, the iaws ought to give place
to the Constitution. But this doctrine is not deducible from any
circumstance peculiar to the plan of the convention, but form the
general theory of a limited Constitution; and as far as it is true, is
equally applicable to most, if not to all the State governments. There
can be no objection, therefore, on this account, to the federal
judicature which will not lie against the local judicatures in general,
and which will not serve to condemn every constitution that attempts
to set bounds to legislative discretion.
But perhaps the force of the objection may be thought to
consist in the particular organization of the Supreme Court; in its
being composed of a distinct body of magistrates, instead of being
one of the branches of the legislature, as in the government of Great
Britain and that of the State. To insist upon this point, the authors of
the objection must renounce the meaning they have labored to annex
to the celebrated maxim, requiring a separation of the departments of
power. It shall, nevertheless, be conceded to them, agreeably to the
interpretation given to that maxim in the course of these papers, that
it is not violated by vesting the ultimate power of judging in a part of
the legislative body. But though this be not an absolute violation of
that excellent rule, yet it verges so nearly upon it, as on this account
alone to be less eligible than the mode preferred by the convention.
From a body which had even a partial agency in passing bad laws,
we could rarely expect a disposition to temper and moderate them in
App. 66
the application. The same spirit which had operated in making them,
would be too apt in interpreting them; still less could it be expected
that men who had infringed the Constitution in the character of
legislators, would be disposed to repair the breach in the character of
judges. Nor is this all. Every reason which recommends the tenure
of good behavior for judicial offices, militates against placing the
judiciary power, in the last resort, in a body composed of men chosen
for a limited period. There is an absurdity in referring the
determination of causes, in the first instance, to judges of permanent
standing; in the last, to those of a temporary and mutable
constitution. And there is a still greater absurdity in subjecting the
decisions of men, selected for their knowledge of the laws, acquired
by long and laborious study, to the revision and control of men who,
for want of the same advantage, cannot but be deficient in that
knowledge. The members of the legislature will rarely be chosen
with a view to those qualifications which fit men for the stations of
judges; and as, on this account, there will be great reason to
apprehend all the ill consequences of defective information, so, on
account of the nat“ral propensity of such bodies to party divisions,
there will be no less reason to fear that the pestilential breath of
faction may poison the fountains of justice. The habit of being
continually marshaled on opposite sides will be too apt to stifle the
voice both of law and of equity.
These considerations teach us to applaud the wisdom of those
States who have committed the judicial power, in the last resort, not
to a part of the legislature, but to distinct and independent bodies of
men. Contrary to the supposition of those who have represented the
plan of the convention, in this respect, as novel and unprecedented, it
is but a copy of the constitution of New Hampshire, Massachusetts,
Pennsylvania, Delaware, Maryland, Virginia, North Carolina, South
Carolina, and Georgia; and the preference which has been given to
those models is highly to be commended.
It is not true, in the second place, that the Parliament of Great
Britain, or the legislatures of the particular States, can rectify the
exceptionable decisions of their respective courts, in any other sense
than might be done by a future legislature of the United States. The
App. 67
theory, neither of the British, nor the State constitutions, authorizes
the revisal of a judicial sentence by a legislative act. Nor is there any
thing in the proposed Constitution, more than in either of them, by
which it is forbidden. In the former, as well
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