Trash Collectors in Mission Viejo Pick Up a Lawsuit : Government: City wants company it contracted with to take over all waste gathering. Firms targeted vow to resist.

Four trash companies will be hauled into court for refusing to make way for a waste firm chosen by the city, according to a lawsuit filed in Orange County Superior Court by city lawyers this week.

For more than a month, city officials say “wildcat” trash haulers have created turmoil for Mission Viejo businesses who don’t know who to deal with--the trash firms that have emptied their bins for years, or Western Waste, which was granted an exclusive contract by the city in July.

“The confusion is being created by the haulers who are refusing to leave town,” City Manager Dan Joseph said. “They think they have [continuation rights], and we’re challenging that.”

Mission Viejo is asking the court to order four trash firms to stop all operations in the city. They are South Coast Refuse of Irvine, Solag Disposal Inc. of San Juan Capistrano, Ware Disposal Inc. of Newport Beach and Orange Disposal Service Inc. of Orange.

“My personal reaction is that the suit is absolutely ludicrous,” said Madelene Arakelian, co-owner of South Coast Refuse. “We will not back down. We will go to court with [the city], if necessary.”

Arakelian and other trash haulers maintain that state law requires any trash hauler doing business in a city for a three-year stretch be given five years’ notice before being asked to leave.

City officials say the same law allows only companies working under a franchise contract the right to five years’ notice.

In the past three years, businesses have been allowed to cut their own deals with trash companies in Mission Viejo, while the city waited for the residential contract to expire so that officials could put both franchises out to bid at the same time.

Trash haulers contend that the city knew they were operating in Mission Viejo, giving them an implied contract and continuation rights.

The tangled legal situation has business owners waiting anxiously to see how the situation will be resolved. Some say Western Waste wants to jack their rates far above what the current hauler is charging.

“The city made a blatant, obvious error by not negotiating a discount for people who have more than one bin,” said Beth Arnold of Davis Partners Inc., which owns a 100-unit apartment complex in Mission Viejo. “It blows me away that they missed something so obvious.”

With South Coast Refuse, Davis Partners is paying $14,400 per year for trash pickup. Their contract offer from Western Waste was $27,228.

While the city battles it out in court, Davis Partners and several other firms say they will sit and wait.

“We aren’t taking action until the city settles this,” Arnold said.

Western Waste officials could not be reached for comment about the lawsuit or proposed rate increases.

The suit omits a fifth waste hauler that has also continued to pick up commercial trash in Mission Viejo.

City officials say they are close to reaching agreement with Waste Management Inc. of Santa Ana to stop doing business in the city. Waste Management services about two-thirds of all the commercial vendors under dispute, comprising about 180 businesses accounting for $40,000 in monthly fees.

Bob Coyle, district manager for Waste Management, said his company had paid Mission Viejo franchise fees for their commercial accounts and is negotiating for a refund.

City officials say that an agreement over the refund amount could be reached at Monday night’s City Council meeting.