Citizens for Des Moines, Inc. v. Petersen

The City of Des Moines was a noncharter city with a council-manager form of government. The city council comprised seven members, and the council appointed a city manager, who in turn appointed the police chief and other department heads. The city manager had sole authority to supervise the city’s administrative affairs, and the city manager reported to the city council. City-council members were prohibited by law from giving any orders to a subordinate of the city manager. For about 40 years, if city police or other park authorities needed a vehicle towed, the officials routinely called Pete’s Towing. The city could call any towing company but usually called Pete’s Towing because it provided great service and was conveniently located. Pete’s Towing billed the vehicle owner for its towing services. Pete’s Towing was one of six divisions of Peterson Northwest Corporation, which was majority owned by Gary Petersen (defendant). In any given year, Pete’s Towing received about 500 tow requests from the city. At one point, Petersen became a city-council member. One month later, Citizens of Des Moines, Inc., and Allan Furney (plaintiffs) sued Petersen, alleging that contracts had been created between the city and Pete’s Towing, the contracts created a conflict of interest for Petersen, and Petersen should be removed from office. On summary judgment, the trial court found that impermissible contracts were created and that the contracts were void. The court ordered Petersen not to accept any further towing requests from the city while he remained in office, and Petersen appealed.