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HonorableT. 0. Walton, President,

Agricultural

& Mechanical College of Texas College Station,Texas Opinion No. O-1915 Dear Sir: Re: Right of materlalmenwho furnishmaterial for constructionof public buildIll@.

Your letter of January 30, 1940, making inquiry of this departmentwith respect to the claim of certain parties for material furnished In connectionwith the'constructionof certainbuildings at your institution,received, and the followingquotation Is taken therefrom:

"On November 7, 1938 a contractwas executed by and between Curtis EleotrlcalCompany, (CharlesE. Curtis, President)of Austin, Texas, a corporationcreated and operatingunder the State laws of the State of Texas, party of the first part and the Agriculturaland Mechanlcal College of Texas of College Station,Texas, acting by and through Its Board of Directors, party>-of

the second part. This Is a contract for furnishingand Installingelectricalwiring and equipment in twelve dormitorybuildingsand
one dining hall building on the campus of the A. & M. College at College Station, Texas, work
on which was substantiallycompleted in Seotemher, 1939.

"We have just received a letter from The Okonite Company of Chicago, Illinois,notifying
us of their claim against the Austin Electrical Supply Company for materials furnished the Curtis ElectricalCompany for this project. We attach a copy of The Okonlte Company's letter covering this claim in which it quotes a telegram from the Curtis Electrical Company by Charles E. Curtis, President,guaranteeingpayment of the materials sold to the Austin Electrical Supply Company for the A. & M. College project.Honorable T. 0. Walton, President,page 2 (No. O-1915)

You will note that The Okonlte Company flies Its claim against the Curtis ElectricalCompany for the unpaid account against the Austin Electrical Supply Company for materials furnished the former for the A. & M. College project. We also attach a copy of the contract provisions relating to liens and claims.

"Will you please advise us at the earliest possiblemoment whether or not we should withhold payment to the Curtis ElectricalCompany for the final estimateon this contractuntil the Curtis ElectricalCompany furnishesthe College a release or waiver of lien or a receipt for payment in full from The Okonite Company for all materials furnished for the project covered by the contract. We know, of course, that where claims are filed with the College against the contractor,that payment of sufficientfunds to Dover the alalmsmust be withheld unti,l the claims have been satisfied, but we do not how whether this applies to claims filed against contractorsfor materials furnished to the contra&or through a third party as appears to be the aase in this Instance.

"We should also like to have you advise us whether or not, before making final settlement to the contraotoron a contract of this type,
we should require the contractorto furnish us with a certlfioatefrom the County Clerk of .this County to the effect that no liens or claimshave been filed in the County Clerk's Office against the contractoror the College for materials and/or labor used in conneotlon with the contract."

The letter which you enclose from The Okonlte Company to you is as follows:

"Confirmingour telephoneadvice we attach copy of our telegramgiving $2452.55as the total claim against the Austin Electrical Supply Companydue Hazard'.~Insulated Wire Works, Division of The Okonite Company,and $92.18 due The Okonite Company.

"The facts in the case are as follows:Honorable T. 0. Walton, President,page 3 (No. O-1915)

"On May 20, 1939 we received through our Dallas office an order from the Austin Electrical Supply Company for electricalwires and cables to be used in connectionwith some work being done'atyour Universityby the Curtis~ ElectricalCo. We advised our Dallas office that we would have to have an up-to-date flnanala1 statementfrom the Austin ElectricalSupply Companybefore we would ship the material:

"On-May 22, 1939, we received the following telegram from the Curtis ElectrloalCo.:

"RECARDINOFINANCIAL STATEMENTOF TRE AUSTIN ELECTRICALSUPPLY COMPANY TIDIY STATE THIS CAN BE SUPPLIEDWITHINP'EW DAYS. WB BUST HAVE WIRE ‘A&M COLLEGE IMMEDIATELYTHEREFOREWE WILL QUARARTEE PAYBENTWITHIN CASH DISCOUNT PERIOD. SEE OUR RATINO LATESTDUN& BRADSTREETBOOK. MAKE SHIPMENT TODAY NOTIFY BY WESTERN UNION IMMEDIATELY.

"&I 'the CURTIS ELECTRICALCOMPANY

BY CHAS. E. CURTIS, PRESIDENT"
strengthof the guarantee oontained In

_ - . the roregolng telegramwe shlpped the merchandise direct to your Universityand charged same to the account of the Austin Electrical Supply Company.

"We oompleteddelivery of the entire order, and the unpaid balance at this time Is $2544.73 which includes $2452.55due the Hazard Insulated Wire Works, Division of The Okonite Company,and $92.18 due The Okonite Company.

"You should understand that Hazard Insulated Wire Works is simply a division of The Okonite Company and not a separate oompany or corporation.

'We have not been able to oolleot this balance from either the Austin ElectrioalSupply ComPang or Curtis ElectricalCo. and we learned last Saturdaymorning that the Curtis ElectricalCo. has furnishedyour archlteats final estimates
on this job with receipts or waivers covering all materials, includinga waiver from the Austin EleotrloalSupply Company.

"We believe that with the Information we- .

HonorableT. 0. W&ton, President,page 4 (No. O-1915)

have given you, you will be in a position to demand that the Curtis ElectricalCo. either furnishyou a waiver or reoelpt from us, or give you an order to pay us our balanoe. We have never heard of any dispute as to this balance and we oannot understandwhy the Curtis EleotrloalCo. or the Austin Eleotrloal Supply Companyhave not paid this aooount in full long ago, slnoe Mr. chas. E. Curtis, from the Informationthat he personally has given us, Is a partner in the Austin ElectricalSupply Companyand Is presidentof the Curtis Electrical Co.

"We trust thereforethat you will withhold payment from the Curtis ElectricalCo. In the
sum of $2544.73until you are providedwith a receipt or release direct from us, or until you reoeive an order from the Curtis ElectricalCo. directingyou to pay that sum of money to us. Unless the matter Is handled In that way, we do not feel secure in the payment of our aooount."

You likewise enclosed the followingexcerpt from your contractwith the Curtis ElectriaalCompany for the construction

of the electricalwork on the buildings Into which the usedr

ment material furnishedby The Okonlte Companywas

"EXCERPTFROM THE CONTRACTDATED NOV. 7, 1938, BETWEEN THE CURTIS ELECTRICAL COMPANYAND THE A. & M. COLLEGE OF TEXAS FOR ELECTRICALWORE ON TWELVE DORMITORIESAND ONE DINING HALL

"It being understoodthat the final payshall be made within ten days after this oontract is oompletelyfinished,wlth.the exaeption of ten per centum of total aontract price which (at option of Owner.,,.)shall be held for 30 days, for protectionof labor, as providedby law; provided, that in each of the said cases the Architect shall oertify that all the work upon the performanceof whioh the payment Is to beoome due has been done to their satisfaotion;

provided, further, that before each payment, if required, the Contractor.... shall give the Architectgood and suffloient pv*rlence

that the premisesare free from allHonorable T. 0. Walton, President,page 5 (No. O-1915)

liens and claims chargeableto the sald.Contractor...., and, further, that If at any time there shall be any lien or claim for which, if established, the Owner

. . ..or the said premisesmight be made liable, and which would be chargeable~to the said Contractor...., the Owner....shall have the right to retain out of any payment then due
or thereafterto become due, an amount sufficient to completely Indemnifyit against such lien or claim....,until the claim shall be effectually satisfied,dischargedor cancelled. And should there prove to be any such claim....after all payments are made, the Contractor....shallrefund to the Owner

. ...a11moneys that the latter may be compelledto pay in dischargingany lien
on said premisesmade obligatoryIn consequence of the former'sdefault. ,.And It Is further understood and agreed that the Contractor....shall and will pay off and satisfy all claims of,subcontractorsor others for labor or material fur-' nished upon said building and which may be found to be justly due and owing, whether or not the
same can be established as a lien against said property for which said property or the Owner... would be liable; it being the true Intent and: meaning hereof that the Contractor....shall pay, off and satisfy all bills incurred for labor,and material In the erectionof said building and found to be justly due and owing, whether estab- ?Hshed as liens or not." (Underscoring ours)

It Is made very plain from the foregoing that the material furnishedby The Okonite Company was furnished to' the contraatorand used In the buildings aovered by its.oontract. The telegramof the Curtis ElectricalCompany to The Okonlte Company is certainly sufficientto make It liable for the payment of this material. When this fact Is .taken in connection with your contraotwith the Curtis Electrical Company, and especiallythe underscored portion thereof)we have no' hesitancy in advisingyou that you should wlthhold'payment to the .Curtis

ElectricalCompany of the final estimateson this contract until the Curtis ElectricalCompany furnishesyou a release, or a receipt of payment in full from The.Okon1t.e Company for its material furnished for the projeot .covered by the oontract.

Article 5472a provides:

"That any person, firm or corporation,orHonorableT. 0. Walton, President,page 6 (No. O-1915)

trust estate, furnishingany material,apparatus, fixtures,machinery or labor to any contractor for any public improvements$n this State, shall have a lien on the moneys, or bonds, 'orwarrants,due or to beoome due to such contraotorsfor such lmpr+vements;provided, such person, firm, corporation, or stock assoolatlon,shall, before any payment is made to suoh oontraotor, notify in writing the officialsof the State, county, town or municipality

whose duty it Is to pay such contractor of his olalm."

Article 5472b provides:

"That no public official,when so notified in writing, shall pay all of said moneys, bonds
or warrants,due said contractor, but shall re- ,. taln enough of said moneys, bonds ore warrants to pay said alaim, In case It Is establish.ed by, judgment In a court of proper jurisdiction."

The foregoingArticles govern the fixing of claims for materials furnished in the construction of permanent lmprovementsin this State. It has been held that these statutes must be given a liberal and not a strict oonstruotlon. smith v. Texas Co., 53 S. W. (2) 774.

Certainly,these statutes under the above rule of oonstruotlon

are sufficientto protect any person, firm or corporation

who furnishedmaterial to a contractor under alraumstanoessuoh as these here under consideration. Wilson vs. Hlnton et ux, 1.16 S. W. (2) 365. These statuteswere lntended to give additionalsecurity to the party furnishingthe material, and should be construedto accomplishsuch end.

As to the second questionyou ask you are advised that It Is the opinion of this departmentthat you should not require the contractorto furnish you with a certificatefrom then County Clerk of your county to the effect that no liens
or claimshave been filed in the County Clerk's office against the contraotoror the college for material and labor furnished in oonneotion

with the contract. The contractwas for a public Improvement, and a party who furnishesmaterial or labor would have to proceed under the above Articles to seoure a lien on the funds of the contractor. And there is no provision in said statutes providing for the filing with the County Clerk of their claims. Furthermore,it has beenHonorable T. 0. Walton, President,Page 7 (No. O-1915)

specifically

held that no lien can be fixed against public property. 29 C. J. 483, &!22, from which we quote, sustains this view:

"PUBLIC PROPERTY .--Upongrounds of necessity and public polioy, buildings,grounds, lmprovementsand works used for and devoted to public purposes are not within the operation of nor subject to mechanics' or materialmen's liens, unless, of course, they are expressly made subject thereto by law. Indeed the Constitutionprovides that

"'The property of oounties, cities and towns, owned and held only for public purposes, such as publia buildings and the sites therefor. Fire engines and the furniture thereof, and all property used, or Intended for extlngulshlng fires, publla grounds and all other property devoted exoluslvely to the use and benefit of the public shall be exempt from forced sale and fran taxation,

. . .I "Accordingly,It has been heid that a mechanic's lien cannot be fixed on a aourthouse and public square, a city hall, a school building, a lot In a cemetery dedicatedand held for sepulture,or public works such as highways; ,streets

and pipe lines s 0 + *"

Since there can be no lien created against public property,we can see no reason for requiringa certificate of the contractorthat~ no such liens have been recordedbefore payment is made to him,

Trusting that the above answers your questiona,
we are Very truly yours,
APPROVED FEB 9, 1940 ATTORREY GENERAL OF TEXAS
Grover Sellers

Grover Sellers Assistant