### ATTORNEY GENERAL OF 

### TEXAS GREG ABBOTT

,The Honorable David R. Austin Ector County Auditor 1010 East Eighth Street, Room 520 Odessa, Texas 79761 September 8,2004

Opinion No. GA-0247
Re: Whether acounty auditor may approve a claim for payment on a contract that was not awarded in compliance with the County Purchasing Act (RQ-0195GA)
Dear Mr. Austin:
You ask whether acounty auditor may approve aclaim for payment on acontract that was not awarded in compliance with the County Purchasing Act, Local Government Code chapter 262, subchapter C. You also ask several related questions about such a contract’s legal effect and the county’s authority to make payments under such acontract.’
I. 

### Background A. Legal Framework
Your questions involve an Ector County contract for athird-party administrator to administer the county’s self-insured medical benefits plan. See Request Letter, supra note 1,at 1. Section 157.002 ofthe Local Government Code provides that a“commissioners court by rule may provide for medical care and hospitalization and may provide for compensation, accident, hospital, and disability insurance” for, among others, county employees, retirees, and their dependents. TEX. LOC. GOV’T CODEANN. 3 157.002(a) (Vernon 1999). In acounty that adopts rules under section 157.002, the commissioners court may require health plan participants to contribute toward the payment of the plan and may establish the “Hospital and Insurance Fund-County Employees” to “pay for the medical care or hospitalization or the insurance.” Id. 5 157.003(a). Section 157.003 provides that “[cllaims shall be paid from the fund in the same manner as provided by law for the payment of other claims of the county.” Id. 5 157.003(d). Chapter 113 of the Local Government Code establishes procedures for paying county claims. Section 113.064(a) requires that [i]n acounty that has the office ofcounty auditor, each claim,

bill, and account against the county must be tiled in sufficient time

‘SeeLetter from Honorable David R.Austin, Ector County Auditor, to Honorable Greg Abbott, Texas Attorney General (Mar. 12,2004) (on tile with the Opinion Committee, also available athttp://~.oag.state.tx.us) [hereinafier Request Letter].The Honorable David R. Austin - Page 2 (GA-0247)

for the auditor to examine and approve itbefore the meeting of the commissioners court. A claim, bill, or account may not be allowed or paid until ithas been examined and approved by the auditor.
Id. 5 113.064(a). Section 113.065 provides that “[tlhe county auditor may not audit or approve a claim unless the claim was incurred as provided by law.” Id. § 113.065. The County Purchasing Act generally requires counties to make certain purchases using competitive bidding. Section 262.023(a) of the Local Government Code provides that [blefore a county may purchase one or more items under a contract that will require an expenditure exceeding $25,000, the commissioners court of the county must: (1) comply with the competitive bidding or competitive proposal procedures prescribed by this subchapter; (2) use the reverse auction procedure, as defined by Section 2155.062(d), Government Code, for purchasing; or (3)comply with amethod described by Subchapter H, Chapter 271.
Id. 4 262.023(a) (Vernon Supp. 2004); see also id. $5 271.111-,121 (Local Government Code, chapter 271, subchapter H). In the Act, the term “item” means “any service, equipment, good, or other tangible or intangible personal property, including insurance and high technology items.” Id. 5262.022(5) (Vernon 1999). Inapplyingsection262,023(a), “all separate, sequential, orcomponent purchases of items ordered or purchased, with the intent of avoiding the requirements of this subchapter, from the same supplier bythe same county officer, department, orinstitution are,treated as if they are part of a single purchase and of a single contract.” Id. 5 262.023(a) (Vernon Supp. 2004). A contract for the purchase of apersonal orprofessional service is exempt from the section 262.023 competitive bidding requirement ifthe commissioners court by order grants the exemption. See id. 5262,024(a)(4). Among other things, the Act requires that notice of aproposed purchase
be published at least once a week in a newspaper of general circulation in the county, with the first day ofpublication occurring before the 14th day before the date ofthe bid opening. Ifthere is no newspaper of general circulation in the county, the notice must be posted in aprominent place in the courthouse for 14 days before the date of the bid opening.
Id. 5262.025(a). The notice must include detailed information about the proposed purchase. See id. §262.025(b).The Honorable David R. Austin - Page 3 (GA-0247)

Sections 262.0295 and 262.030 of the Local Government Code authorize a county to use alternate competitive procedures in certain limited circumstances. Under section 262.0295, upon a finding by the commissioners court that it is impractical to prepare detailed specifications for an item to support the award of apurchase contract, the county official who makes purchases for the county may use amultistep competitive proposal procedure, soliciting quotations through arequest forproposals. See id. 5262,0295(a)(l)-(2), (b) (Vemon 1999); see also id. 5262.0295(a)(3) (“This section applies only to acounty with apopulation of 125,000 or more.“). Section 262.030 permits counties to use a competitive proposal procedure, soliciting quotations through a request for proposals, topurchase, among other things, insurance and high technology items. See id. 5262.030 (Vernon Supp. 2004). Sections 262.0295 and 262.030 both require the county to provide notice. See id. 35 262.0295(b) (Vernon 1999) (“Public notice for the request for proposals must be made in the same manner asprovided in the competitive bidding procedure, except that the notice may include a general description of the item to be purchased, instead of the specifications describing the item or a statement of where the specifications may be obtained, and may request the submission of unpriced proposals.“), 262.030(b) (Vernon Supp. 2004) (“Public notice forthe request forproposals must be made in the same manner asprovided in the competitive bidding procedure.“). Section 262.033 provides that “[a]ny property tax paying citizen of the county may enjoin performance under a contract made by a county in violation of this subchapter.” Id. § 262.033 (Vernon 1999). In addition, acounty officer or employee who violates the Act is subject to criminal prosecution and removal from office.’ 

### B. Factual Background
You inform us that in 1983 Ector County established aself-insured medical benefits plan for its employees, retirees, and their dependents, as authorized by section 157.002 ofthe Local Government Code. See Request Letter, supra note 1,at 1;see also TEX. Lot. GOV'T CODE ANN. $9 157.002-.003 (Vernon 1999), supra. Historically, the county has obtained the services ofathirdparty administrator (“TPA”) to administer the plan and has followed the County Purchasing Act to award the TPA contract. See Request Letter, supra note 1,at 1,
Your questions involve aTPA contract that Ector County entered into in the fall of 2003. In September 2003, the Ector County Commissioners Court rescinded the TPA contract that was then in effect for aone-year term, and it awarded anew contract to another TPA, effective October

‘Under section 262.034(a)-(b), a county officer OI employee who “intentionally or knowingly makes or authorizes separate, sequential, or component purchases to avoid” section 262.023’s competitive bidding requirements, OIintentionally orknowingly violates section 262.023 by other conduct, commits aClass Bmisdemeanor. &~TEx. LOC. Gov'r CODEANN. 5 262.034(a)-(b) (Vanon 1999). Under section 262.034(c), a county officer or employee who intentionally OTknowingly violates the Act, other than by conduct described by section 262.034(a) or (b), commits a Class C misdemeanor. See id. 5 262.034. “The final conviction of acounty officer or employee for an offense under Section 262.034(a) OI(b) results in the immediate removal from off& OIemployment ofthat person.” Id. 5262.035(a). The removed ofticer or employee is ineligible for four years after the date of final conviction for public office and for county employment or compensation. See id. 5262.035(b).The Honorable David R. Austin - Page 4 (GA-0247)

1,2003. As county auditor, you determined that the commissioners court had not complied with the County Purchasing Act’s competitive bidding requirements inprocuring the new TPA contract and asked the county attorney for an opinion. See id. at 1-2. While waiting for the county attorney’s opinion, the county made payments to the new TPA for services provided under the contract. See id. at 2. The county attorney concluded that the county had failed to comply with the County Purchasing Act’s notice requirements in procuring the new TPA contract but also stated that the contract “‘is in effect and the County is under obligation to perform under the contract.“’ Id. 

### II. Analvsis
You ask nine questions about the TPA contract. We understand that there is some dispute regarding the county auditor and the county attorney’s conclusion that the county did not comply with the County Purchasing Act in awarding the contract. For example, an attorney for the TPA contends that the TPA provides professional services andthat the commissioners court was therefore authorized to exempt the contract from competitive bidding.’ A county commissioner, on the other hand, asserts that the county solicited proposals for the contract pursuant to aprocedure permitted by section 262.030 ofthe Local Government Code! Your questions ask us to assume that the TPA contract was not awarded in compliance with the County Purchasing Act. We do not examine that assumption. 

### A. Local Government Code, Section113.065
First you ask, “[alssuming the contract was not competitively procured,” whether the county auditor may legally approve aclaim forpayment to the TPA for services rendered under the contract under Local Government Code, section 113.065. See id. at 3. Claims paid from acounty’s hospital and insurance fund must be paid in the “same manner as provided by law for the payment of other claims of the county.” TEX.Lot. GOV’T CODE ANN. 5 157.003(d) (Vernon 1999). Chapter 113 ofthe Local Government Code expressly provides that aclaim, bill, or account may not be allowed orpaid until ithas been examined and approved by the county auditor. See id. § 113.064(a). Section 113.065 provides that “[tlhe county auditor may not audit or approve aclaim unless the claim was incurred as provided by law.” Id. 5 113.065. “The language ofthese statutes ismandatory. They impose on the auditor the responsibility, before approving aclaim, to determine whether it strictly complies with the law governing county

‘See Brief from Eric J. Nathan, Weener & Nathan, L.L.P., at 2 (May 28, 2004) (on file with the Opinion Committee); see dso TEX.LOC.GoV’T CODEANN. 8262,024(a)(4) (Vanon Supp. 2004); Tex. Att’y Gen. Op. Nos. DM-418 (1996) at 9-13, JM-1038 (1989) at2 (considering whether acontract for services ofathird party administrator is exempt from competitive bidding laws as acontract for professional services).

‘See Letter from Honorable Barbara Graff, Ector County Commissioner, to Nancy Fuller, Chair, Opinion Committee, Office of the Attorney General (May 26,2004) (on file with the Opinion Committee); see also TEX.LOC. GOV’T CODE ANN. $ 262.030 (Vernon Supp. 2004) (permitting counties to use a competitive proposal procedure, soliciting quotations through arequest for proposals, to purchase, among other things, insurance and high technology items).The Honorable David R. Austin - Page 5 (GA-0247)

finances.” Smith v. McCoy, 533 S.W.2d 457, 459 (Tex. Civ. App.-Dallas 1976, writ dism’d) (addressing the statutory predecessors to Local Government Code sections 113.064-,065, former articles 1660 and 1661); see nlso Criderv. Cox, 960 S.W.2d 703,706 (Tex. App.-Tyler 1997, writ denied) (“A claim against the county may not be approved by the Auditor unless itwas incurred in accordance with the law.“) (citing Local Government Code section 113.065). Although no court has addressed the issue, anumber ofattorney general opinions have concluded that acounty auditor may not approve aclaim for acontract that was not awarded in compliance with acompetitive bidding law, see Tex. Att’y Gen. Op. Nos. V-285 (1947), O-770 (1939), or similar law limiting county purchasing authority, see Tex. Att’y Gen. Op. Nos. JC-0266 (2000) (a county auditor may not approve a claim for payment under a contract made in violation of the Professional Services Procurement Act) (citing Local Government Code section 113.065), H-1237 (1978) (“The commissioners court isnot authorized to order payment ofaclaim under acontract made inviolation of article 1580 [requiring county purchases to be made by purchasing agent], and the auditor is prohibited from paying such aclaim.“).
In answer to your question, if a county auditor determines that a contract was awarded in violation of the County Purchasing Act, section 113.065 of the Local Government Code prohibits the auditor from approving the claim. Aclaim may not be approved by the commissioners court or paid by the county without the auditor’s approval5 See Crider, 960 S.W.2d at 706 (the county auditor’s approval of aclaim is arequisite to the commissioners court’s approval; without county auditor approval, the commissioners court’s approval of aclaim is void). 

### B. The Contract’s LegalEffect
You ask several questions about the TPA contract’s legal effect. We begin with your question asking whether “acontract that does not comply with the [County] Purchasing Act [is]void orvoidable?” Request Letter, supra note 1,at 3 (question 5). As you point out, Local Government Code chapter 271, subchapter B establishes competitive bidding requirements for certain public works contracts. ~TEx. Lot. GOV’TCODE ANN. @ 271.021.,030 (Vernon 1999 & Supp. 2004). Section 271.028 of the Local Government Code expressly provides that “[a] contract awarded in violation of this subchapter is void.” Id. 5271.028 (Vernon 1999). Similarly, chapter 252 of the Local Government Code, governing municipal purchasing, contains a provision stating that a contract “made without compliance with this chapter” is “void and performance of the contract may be enjoined” by a municipal taxpayer. See id. 5 252.061. By contrast, the County Purchasing Act provides that “[a]ny property tax paying citizen of the county may enjoin performance under acontract made by acounty in violation of this subchapter,” id. 5262.033, but does not contain aprovision stating that acontract awarded in violation of its requirements is void.
The legislature adopted the statutory predecessor tothe County Purchasing Act, former article 2368a.5, in 1985. See Act ofMay27, 1985, 69th Leg., R.S., ch. 641, 1985 Tex. Gen. Laws 2377,

‘Given ouranswertoyourfirstquestion,wedo not answeryoursecond question. See Request Letter, supra note 1, at 3 (“If the answer to #I is ‘yes,’ are there judicial rulings or statlltory authority other than Local Government Code, Section 113.065 providing for County Auditor approval for either the past 01the future payment of services?“).The Honorable David R. Austin - Page 6 (GA-0247)

2377-85. Prior to 1985, various statutes governed county purchasing, many of which applied to counties, municipalities, and other political subdivisions. For example, the statutory predecessor to the municipal purchasing provisions, former article 2368a, now chapter 252 of the Local Government Code, applied to both cities and counties. See, e.g., Corbin v. CoNin County Comm ‘rs Court, 651 S.W.2d 55,56 (Tex. App.-Dallas 1984, no writ) (addressing whether acounty awarded acontract in compliance with former article 2368a). Article 2368a, section 2(d) provided: Any and all contracts or agreements hereafter made by any county or city in this state, without complying with the terms of this section, shall be void and shall not be enforceable in any court ofthis state and the performance of same and the payment of any money thereunder may be enjoined by anyproperty taxpaying citizen ofsuch county or city.
See Bond and Warrant Law of 1931,Act ofMay 21,193 1,42d Leg., R.S., ch. 163,193 1Tex. Gen. Laws 269, 270-71, as amended byAct of May 30, 1981, 67th Leg., R.S., ch. 505, 52, 1981 Tex. Gen. Laws 2164, 2164-65. Statutes that predated article 2368a, former articles 2368 and 2268b, contained similar provisions. SeeLimestone County v.Knox, 234 SW. 131(Tex. Civ. App.-Dallas 1921,no writ) (addressing similar language in former article 22681, and concluding that acontract was void because the commissioners court awarded it without complying with statutory requirements). A contract that is void under the terms of such a statute is anullity:

The commissioners’ court being without power or authority to make the contract in the first instance without compliance with the terms of the statute, the contract was void and could not be vitalized and made binding and enforceable by ratification or otherwise. [A] contract which the law denounces as void is necessarily no contract whatever and the acts ofthe parties in an effort to create one in no wise bring about a change of their legal status. A void contract is amere nullity, and is obligatory on neither party to it. “It requires no disaffinnance to avoid it and cannot be validated by ratification.”
Id. at 134.
In 1985, the legislature adopted the County Purchasing Act, amended article 2368a and other laws applicable to counties and other entities to remove counties from their scope, and repealed many inconsistent countypurchasingprovisions. See Act ofMay27,1985,69th Leg., R.S., ch. 641, 35 1 (enacting County Purchasing Act), 2-4, 8 (amending other laws to delete counties), 11 (repealing county purchasing laws), 1985 Tex. Gen. Laws 2377,2377-84. Although the County Purchasing Act, unlike Local Government Code sections 252.061 and 271.028 and provisions in former laws applicable to county purchasing, does not contain language stating that acontract awarded in violation of its provisions is void, nojudicial or attorney general opinion since 1985 has addressed this change’s potential significance. The 1985 legislative historyThe Honorable David R. Austin - Page 7 (GA-0247)

does not discuss the change.6 However, the legislature’s omission of language in the County Purchasing Act making contracts void is significant and must be given effect. See City ofHouston Y.Clear Creek Basin Auth., 589 S.W.2d 671, 681 (Tex. 1979) (“It is apparent that in amending the statute, the legislature intended some change in the existing law, and this court will endeavor to effect the change.“); Am, Sur. Co. 0fN.Y. v.Axtell, 36S.W.2d 715,719 (Tex. 1931) (the legislature ispresumed tohave intended some change to existing law when enacting an amendment and effect must be given to the amendment); see also TEX. GOV’T CODE ANN. 5311.023(4) (Vernon 1998) (in construing astatute, acourt may consider “former statutory provisions, including laws on the same or similar subjects”). As aresult, we conclude that contracts awarded in violation of the County Purchasing Act are not void ab initio but rather may be declared void by acourt. Under section 262.033 ofthe Local Government Code, “[a]ny tax paying citizen may enjoin performance under acontract made by acounty in violation of’ the County Purchasing Act. TEX. Lot. GOV’T CODE ANN. $ 262.033 (Vernon 1999). In addition, in some cases an unsuccessful bidder may bring adeclaratoryjudgment action seeking tohave acontract declared void onthe basis that the county failed to award it according to the County Purchasing Act’s procedures. See, e.g., Securtec, Inc. Y. County of Gregg, 106 S.W.3d 803 (Tex. App.-Texarkana 2003, pet. denied) (concluding that an unsuccessful bidder could bring adeclaratory judgment action requesting the court to declare acontract void because the county did not comply with the County Purchasing Act).
We stress, however, that the County Purchasing Act’s enforcement provisions donot modify acounty auditor’s duty under section 113.065 ofthe Local Government Code to refuse to approve aclaim that was not incurred in compliance with law. Section 113.065’s charge that “[tlhe county auditor may not audit or approve aclaim unless the claim was incurred as provided by law,” TEX. LOC. GOV’T CODE ANN. 5 113.065 (Vernon 1999), remains in effect. Under section 113.065, a county auditor need not obtain acourt order declaring the contract void for noncompliance with the County Purchasing Act to exercise the duty towithhold approval of aclaim. See Smith, 533 S.W.2d at459 (acountyauditorwho acted to deny claims under the statutorypredecessor to section 113.065 “was acting within his official discretion to deny the claims and to require that their validity be established in acourt of law”). Moreover, acounty auditor’s decision to approve or disapprove a claim is adiscretionary as opposed to aministerial act. Id.; see also Crider, 960 S.W.2d at706-07. A court will require a county auditor to approve aclaim only if the auditor has abused his or her discretion. See Crider, 960 S.W.2d at 706-07 (mandamus will lie to force a county auditor to approve a claim only “to correct aclear abuse of discretion when there is no adequate remedy by ordinary appeal”). If a party cannot establish that the auditor abused his or her discretion, “the remedy. isasuit against the countyto establish the [claim’s] validity.” Smith, 533 S.W.2d at461.

6S~~H~~~~C~~~.~~C~~~A~~~~,B~~~A~~~~~~~,Tex. S.B. 807,69thLeg.,R.S. (1985);Hous~S~~~~ GROUP,BILLANALYSIS,Tex. S.B. 807, 69th Leg., R.S. (May 14, 1985); HOUSECOMM.ONCOLJNTY AFFAIRS,BILL ANALYSIS,Tex. C.S.S.B. 807, 69th Leg., R.S. (1985); Hearings on Tex. S.E. 807 Before rhe Senate Comm. on InfergovernmenralRe[ntions, 69thLeg., R.S. (Mar. 26,1985) (tapes available &Senate StaffServices Office); Hearings on Tu. S.B. 807 Before the Senate Comm. on Intergovernmental Relations, 69th Leg., R.S. (Apr. 2, 1985) (tapes available at Senate Staff Services Offke); Debate on Ta. S.B. 807 on the Floor ofthe Senate, 69th Leg., R.S. (Apr. 11, 1985) (tapes available at Senate Staff Services Office); Debate on Tex. S.B. 807 onfhe No& ofthe House, 69th Leg., R.S. (May 15, 1985) (tapes available at House Video/Audio Dep’t).The Honorable David R. Austin - Page 8 (GA-0247)



### C. The Commissioners Court’s Authority to Provide a Basis for Contract Payments
You ask several questions about acommissioners court’s authority toprovide abasis for a county auditor to approve contract payments even though the claim was not “incurred as provided by law.” TEX. Lot. GOV’T CODEANN. 5 113.065 (Vernon 1999).
You ask about the commissioners court’s authority to ratify the contract: “[Wlhat action, if any, could be taken by the County in order for the County Auditor to lawfully approve aclaim for payment to [the TPA] for future services under the contract? For example, could the Court in some way ratify acontract that did not comply with competitive bidding statutes?” Request Letter, supra note 1,at 3 (question 4). In arelated question you ask whether the fact that acontract that does not comply with the County Purchasing Act is voidable rather than void affects the commissioners court’s authority to ratify it. See id. (question 5) (“Is a contract that does not comply with the Purchasing Act void or voidable, and does the determination make a difference in whether or not a contract can be ratified?“).
A commissioners court lacks authority toratify acontract expressly made void by law, such as acompetitive bidding law providing that acontract made in violation of its terms is void. See, e.g., Wyatt Metal & Boiler Worh v. Fannin County, 111 S.W.2d 787, 790 (Tex. Civ. App.-Texarkana 1937, writ dism’d) (“These purchases having been made in violation of the provisions of the articles requiring competitive bids, the [commissioners court] was without authority to ratify same, forthis would grant them apower to do something indirectly they could not do directly.“); Limestone County, 234 S.W. at 134(acommissioners court could not ratify acontract awarded in violation of competitive bidding requirements).
But authority to ratify does not depend on the contract being void rather than voidable. The authority to ratify is premised on the authority to enter into the contract in the first place. See Stratton v.Liberty County, 582 S.W.2d 252,254 (Tex. Civ. App.-Beaumont 1979, writ ref dn.r.e.) (“That which the Commissioners’ Court could authorize in the first instance could be ratified by it at asubsequent date.“); Angelina County v.Kent, 374 S.W.2d 313,317 (Tex. Civ. App.-Beaumont 1963, no writ) (“what the Commissioners Court could approve in the first instance, itmay ratify”); Cameron Countyv. Fox, 61 S.W.2d 483,487 (Tex. Comm’n App. 1933, holding approved) (“What the commissioners’ court could have authorized in the beginning, that court could subsequently ratify.“). Conversely, acommissioners court may not subsequently ratify acontract that it lacked authority tomake. See JaCkv. State, 694 S.W.2d 391,397 (Tex. App.-San Antonio 1985, writ ref d n.r.e.) (“Ratification may not be used tojustify the making of an illegal contract, A contract which is made in violation of a statute is illegal and void and therefore not subject to ratification.“); Tex. Att’y Gen. Op.Nos. JM-1027 (1989) at8(“[The purchase] camrotbe ‘ratified’ bythe commissioners court since the commissioners court cannot bind the county by ratification of a contract the court itself had no authority to make in the first place.“), H-1237 (1978) at 1 (“The authority of the commissioners court to regulate county fiscal matters has been circumscribed by article 1580, and since the court was powerless to make the contract initially, itwas equally powerless to ratify it.“).The Honorable David R. Austin - Page 9 (GA-0247)

A commissioners court’s authority is limited to those powers conferred either expressly or by necessary implication from the constitution and laws of this state. See Guynes v. Galveston County, 861 S.W.2d 861, 863 (Tex. 1993) (citing Canales Y.Laughlin, 214 S.W.2d 451,453 (Tex. 1948)); Tex. Att’y Gen. Op. Nos. GA-0158 (2004) at4, GA-0085 (2003) at2;see also TEX. CONST. art. V, 5 18(b). When the County Purchasing Act governs the commissioners court’s authority to enter into a contract, the commissioners court lacks authority to enter into a contract outside its provisions. Because itlacks authority to enter into acontract in violation ofthe County Purchasing Act in the first place, acommissioners court lacks authority to subsequently ratify such acontract. It is immaterial to the authority to ratify that the County Purchasing Act does not provide that a contract awarded in violation of its requirements is void.
You also ask about the commissioners court’s authorityto make “quantum meruit”payments onthe contract: “[Wlhat action, ifany, could be taken bythe County, in order forthe County Auditor to audit and lawfully approve aclaim for payment [to the TPA] for services already rendered? For example, could the Court approve payment in quantum meruit?” Request Letter, supra note 1, at 3 (question 3). In a similar question you ask, “Ifthe only legal vehicle for payment is aclaim in quantum meruit, could the court suffer the continuing provision of services while making periodic

‘quantum meruit’ settlement payments?” Id. at 4 (question 9). Quantum meruit is a legal doctrine pursuant to which a court may order aparty to pay for benefits received despite the absence of an enforceable contract. See Heldenfek Bros., Inc. Y.City of Corpus Christi, 832 S.W.2d 39, 41 (Tex. 1992) (“Quantum meruit is an equitable theory of recovery which isbased on an implied agreement to pay for benefits received.“). Aplaintiff must establish the following to recover under the doctrine of quantum meruit: (1) valuable services or materials were furnished, (2) forthe person or entity sought tobe charged, (3)which were accepted, used, and enjoyed by the person or entity sought tobe charged, and (4)under such circumstances as reasonably notified the person orentity sought tobe charged that the plaintiff, inperforming services or furnishing properties, expected to be paid by the person or entity to be charged. Id. Under chapter 113 of the Local Government Code, a commissioners court may not pay a claim until ithas been examined and approved by the county auditor, see TEX’

. Lot. GOV’T CODE ANN. $5 113.064-,065 (Vernon 1999), and “[tlhe county auditor may not audit or approve aclaim unless the claim was incurred as provided by law,” id. § 113.065. Neither chapter 113 nor the County Purchasing Act authorizes acommissioners court to approve quantum meruit payments on acontract that was not awarded in compliance with the County Purchasing Act to provide abasis forthe county auditor to approve claims on the contract. Inthe event acounty auditor rejects aclaim for payment for noncompliance with the County Purchasing Act, the claimant could tile a legal action torecover damages inquantum meruit. Seegenerally Base-Seal, Inc. v.Jefferson County, 901 S.W.2d 783 (Tex. App.-Beaumont 1995, writ denied) (discussing the recovery available in a quantum meruit action brought by acompany whose claims for payment by acounty were rejected for noncompliance with the County Purchasing Act). Acourt may order acounty to make quantum meruit payments in such alegal action. Inthat case, the court’s order would provide abasis for the county auditor to determine that the claim “was incurred as provided by law.” TEX. Lot. GOV’T CODEANN. 5 113.065 (Vernon 1999). See generally WyattMetal &Boiler Works, 111 S.W.2d atThe Honorable David R. Austin - Page 10 (GA-0247)

790-91 (“Under the record [establishing that contract was void and commissioners court lacked authority toratify it], plaintiff was relegated to asuit against the county upon animplied contract for the reasonable value ofthe benefits which Famrin County received from the use ofthese culverts.“).
D. 

### QuestionsPremisedonVoidContract Finally, you premise several questions on the conclusion that a contract made in violation of the County Purchasing Act is void:
Ifthe contract isvoid, should the County take action tobid the services asprovided under Local Government Code, Chapter 262 and would this limit or increase potential liability to the County?
Ifthe contract is void, can the County enter into amonth-tomonth contract with [the TPA] for TPA services until such time as a vendor can be awarded the TPA services under Local Government Code, Chapter 262 or would a month-to-month contract create a continuing violation?
If the contract is void, ratification is not an option and the Purchasing Act does not provide for amonth-to-month contract, are there other legal avenues available tothe County in order to continue the activities of the Plan as it pertains to plan and claims administration? Request Letter, sup-a note 1,at 3-4 (questions 6-8). Given our conclusion that the contract is not void ab initio, and because we understand that the county has made monthly payments on the contract, which terminates on September 30,2004, we do not answer these questions. Should you decide to disapprove future contract payment claims under section 113.065 ofthe Local Government Code, we suggest that you seek the county attorney’s advice with respect to the county’s options to obtain TPA services and the county’s legal position in any potential litigation.The Honorable David R. Austin - Page 11 (GA-0247)



### SUMMARY
If the county auditor determines that the county awarded a contract without complying with the County Purchasing Act, section 113.065 of the Local Government Code prohibits the auditor from approving aclaim forpayment on the contract. Such acontract isnot void ab initio but may be voided by acourt. The fact that the County Purchasing Act does not provide that acontract made in violation of its terms isvoid does not affect acounty auditor’s duty under section 113.065 of the Local Government Code to disapprove a claim for payment on acontract awarded without complying with the County Purchasing Act. Acommissioners court lacks authority toratify such acontract or to approve quantum meruit contract payments for such acontract.

G ABBOTT ey General of Texas

BARRY R. MCBEE First Assistant Attorney General
DON R. WILLETT Deputy Attorney General for Legal Counsel
NANCY S. FULLER “’ Chair, Opinion Committee Mary R. Crouter Assistant Attorney General, Opinion Committee