Court Opinion

ID: 4130442
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:04:20.909447+00
Date Added: 2024-06-11T13:26:04.451910
License: Public Domain

March 16, 1989

Honorable James W. Smith, Jr.       Opinion No.   JM-1027
Frio County Attorney
P. 0. BOX v                         Re: Whether certain county
Pearsall, Texas 78061-1138          road contracts must be com-
                                    petitively bid under court/
                                    engineer  system,     section
                                    3.201 of article      6702-1,
                                    V.T.C.S.    (RQ-1460)

Dear Mr. Smith:

     You ask five questions which appear to have arisen in
connection with the following factual circumstances as de-
scribed in your request:

        Frio County, Texas, for the last 2 years has
        been operating under the Court/Engineer  Sys-
        tem as to the maintenance of its roads as set
        out in V.A.C.S., art. 6702-1, Sec. 3.201 et
        seq. And for the same length of time Frio
        County has employed a licensed professional
        engineer.

           .   .   .   .

        The Frio County Engineer ordered emulsion for
        a paving project - the ordering was done
        April 7 through April 22, 1988.

        The Engineer had planned the project well in
        advance of the start up date of the project.
        He had knowledge of the approximate amount of
        this product he would need and the price of
        the product.

        Invoices were received by the County Auditor
        on May 5, 1988, in the amount of $9,128.04
        for payment on the emulsion. The Engineer
        has stated that additional emulsion is needed
        to complete the road paving project.

                                 p. 5300
Honorable James W. Smith. Jr. - Page 2   (JM-1027)

        The County Auditor after receiving the in-
        voices questioned the Engineer as to why the
        project wasnIt let out for bids. The Engi-
        neer stated that the company from which the
        emulsion was provided was the 'sole source'
        for the product. The Auditor has refused to
        pay for the emulsion received   so far, con-
        tending that it does not meet the require-
        ments of    Section   262.024,  'Exemptions,'
        quoted in part supra. Furthermore in accor-
        dance with Local Government    Code, Section
        113.901 a requisitions [sic] for the materi-
        als was not attached to the account presented
        to the County Auditor by the Engineer nor was
        the requisition approved by the County Judge.
        The County Auditor therefore   in accordance
        with Sections 113.064 and 113.065 of the Code
        has refused to approve the claims    for the
        emulsion.

     The first of your questions we address is:

        Is there     a conflict   between    V.A.C.S.,
        art. 6702-1, sec. 3.211 and the competi-
        tive bidding     and  proposal    requirements
        of V.T.C.A.,   Local Government   Code, Sets.
        262.023 and 262.024?

     Your letter indicates that the focus of your concern
is an apparent   conflict between article   6702-1,  section
3.211, V.T.C.S.,   and sections 262.023 and 262.024 of the
Local Government   Code, with respect to the competitive
bidding requirements applicable  to a purchase of emulsion
such as you describe in your statement of facts.1   Sections
3.201 through   3.213 of article   6702-l provide   for the
adoption by a county of the "court/engineer system" for the

     1. In the absence of any contrary indication in your
statement of facts, we assume for purposes of this opinion
that the $9,128.04  emulsion purchase  constituted a single
purchase contract.  Both section 3.211 of article 6702-l and
subsection (c) of section 262.023 of the Local Government
Code provide that such a purchase, even if made in separate,
sequential, or component transactions, should be considered
a single purchase  for purposes of the competitive   bidding
requirements of those provisions.

                              P. 5301
Honorable James W. Smith. Jr. - page 3   (JM-1027)

construction and maintenance of county roads.   Section 3.211
of article 6702-l provides in part:

           All equipment, materials, and supplies for
        the construction   and maintenance   of county
        roads and for the county road department
        shall be purchased by the commissioners court
        on competitive bids in conformity with esti-
        mates and specifications     prepared   by the
        county road engineer. However, on recommen-
        dation of the county road engineer and when
        in the judgment of the commissioners court it
        is considered   in the best interest of the
        county, purchases in an amount not to exceed
        $5,000 may be made through negotiation by the
        commissioners   court or the      commissioners
        court's authorized representative on requisi-
        tion to be approved by the commissioners
        court or the county auditor without      adver-
        tising for competitive bids.

The Local Government  Code, section 262.023, a part of    the
County Purchasing Act, provides in subsection (a):

           Before a county may purchase one or more
        items under a contract that will require an
        expenditure  exceeding  $5,000, the commis-
        sioners court of the county must comply with
        the competitive    bidding   or   competitive
        proposal  procedures   prescribed   by   this
        subchapter.  All bids or proposals must be
        sealed.

     Section 262.024 of the Local Government Code provides
exemptions  to the competitive    bidding  requirements   of
section 262.023. As your request focuses specifically     on
the exception to the competitive bidding requirement for an
item that can only be obtained    from one source, we will
consider only that aspect of the section 262.024 exemptions.
Section 262.024 provides in relevant part:

           (a) A contract for the purchase of any of
        the following items is exempt from the re-
        quirement established by Section 262.023  if
        the commissioners court by order grants the
        exemption.

           .   .   .   .

                               Pm 5302
Honorable James W. Smith. Jr. - Page 4    (JM-1027)

                (7) an item that can be        obtained
           from only one source, including:

                      (A) items for which competition
                is precluded because of the existence
                of patents,  copyrights, secret pro-
                cesses, or natural monopolies:

                      (B)   films,   manuscripts,      or
                books;

                     (C) electric power, gas, water,
                and other utility services; and

                     (D) captive replacement        parts
                or components for equipment.

            (b) If an item exempted under Subsection
        (a)(7) is purchased, the commissioners court,
        after accepting a signed statement from the
        county official who makes purchases for the
        county as to the existence      of only one
        source, must enter in its minutes a statement
        to that effect.

     Section 262.024 on its face provides exemptions    only
from the section 262.023 competitive bidding requirement and
not from the competitive bidding requirement     of section
3.211 of article 6702-l. The question then is whether    the
provisions of sections 262.023 and 262.024 implicitly repeal
the separate competitive   bidding  requirement  of section
3.211.

     Section 311.026 of the Government Code provides     the
rule of statutory construction that we believe resolves this
question:

           (a) If a general provision conflicts with
        a special or local provision, the provisions
        shall be construed, if possible, so that ef-
        fect is given to both.

            (b) If the conflict between the general
        provision and the special or local provision
        is irreconcilable, the special or local pro-
        vision prevails as an exception to the gener-
        al provision, unless the general provision is
        the later enactment  and the manifest  intent
        is that the general provision prevail.

                                P. 5303
Honorable James W. Smith. Jr. - Page 5   (JM-1027)

     Section 3.211 is a special provision applicable to the
purchase of materials for county roads under the court/
engineer system.  Sections 262.023 and 262.024 a.re general
provisions applicable to most county purchases.  Though the
provisions of sections 262.023 and 262.024, enacted in 1985
as part of the County Purchasing Act (then article  2368a.5,
V.T.C.S.), appear to be more recently enacted, we find no
"manifest intent" of the legislature that the provisions   of
sections 262.023 and 262.024 prevail over those of section
3.211. Acts   1985, 69th Leg., ch. 641, § 1, at 2377.
Article 6702-1, including section 3.211 thereof, was    first
enacted in 1983, Acts 1983, 68th Leg., ch. 288, at 1431, but
section 3.211 was amended by the legislature    in the same
bill that enacted the County Purchasing   Act.   Acts   1985,
69th Leg., ch. 641, 5 10, at 2384.    The 1985 amendment   to
section 3.211 raised the limit on purchases under section
3.211 that could be made through negotiation from $1,000 to
$5,000 but left the other provisions      of that section,
including those regarding competitive bidding, intact -- an
indication that the legislature intended that the provisions
of section 3.211 still apply to county purchases of "[a]11
equipment, materials, and supplies for the construction   and
maintenance of county roads" under the court/engineer    sys-
tem.

     Thus, we conclude that the competitive     biddinq re-
quirement of section 3.211 applies to a purchase, under the
court/engineer system of road materials in the amount of
over $5,000, such as the $9,128.04 emulsion purchase    you
describe   in your statement of facts.      There being no
provision of law exempting    sole source items from the
competitive bidding requirement  of section 3.211 for pur-
chases of over $5,000 under that section,2      an emulsion
purchase such as the one you describe must be made on com-
petitive bids.

     However, though we find that the requirement of section
3.211 (that all road material purchases under the court/en-
gineer system in excess of $5,000 be made on competitive

     2. We note that section 262.003 of the Local Govern-
ment Code provides for a sole source purchase exemption from
"[a]ny law that requires a county to follow a competitive
bidding procedure in making a purchase requiring the expen-
diture of $5,000 or less." That exemption does not apply to
the emulsion purchase in question which was for $9,128.04.

                              P. 5304
Honorable James W. Smith. Jr. - Page 6   (JM-1027)

bids) prevails over the conflicting provisions of sections
262.023 and 263.024 (which would allow purchase of such ma-
terials, if only available from a sole source, without   com-
petitive bids), we believe that otherwise the provisions   of
section 3.211 and sections 262.023 and 262.024 can be con-
strued "so that effect is given to both," pursuant to sub-
section (a) of section 311.026 of the Government Code. That
is, if a court/engineer system road material purchase     ex-
ceeds $5,000, it must be made on competitive bids, under
section 3.211, but it also "must comply with the competitive
bidding . . . procedures prescribed by [subchapter C, chap-
ter 262 of the Local Government Code]," pursuant to subsec-
tion (a) of section 262.023. See 35 262.025-.028 (providing
for competitive bidding notice, opening of bids, awarding of
contract, use of lump sum or unit price method).3

     The second of your questions, which we now turn to, is:

        The County Engineer has never been officially
        authorized   by the Commissioners   Court   in
        accordance   with  Local   Government   Code,
        Section   262.001 to be an agent to make
        contracts on behalf of the County for 'any

     3. A brief submitted in connection with your request
argues that the ruling in Attorney    General Opinion   JM-505
(1986) indicates that chapter 262 of the Local Government
Code does not apply to "public works contracts," which    that
opinion ruled were covered    instead by the provisions    now
codified as chapter 271, subchapter B, of the Local Govern-
ment Code. The brief argued that we should now overrule
Attorney General Opinion JM-505. That opinion dealt with
bid, performance and payment bond requirements for public
works contracts.   Since we believe, contrary to the position
taken in the brief, that the emulsion purchase contract here
is not a "public works contract," that is, a "contract     for
the construction,   repair, or renovation   of a structure,
road, highway   or other improvement or addition      to real
property" under chapter    271, see   5 271.024, we do not
consider chapter   271 in connection   with this opinion or
reconsider the ruling of Attorney General Opinion       JM-505
with respect to its applicability.       See, e.g., City of
Houston v. Glover, 89 S.W. 425 (Tex. Civ. App. 1905, writ
ref'd) (city charter provision for competitive bidding      on
"public works" not applicable to contract with architect    to
prepare plans for public building).

                              P. 5305
Honorable James W. Smith. Jr. - Page 7      (JM-1027)

        other purpose authorized by law.' Would this
        invalidate any and all contracts    that the
        County had with a supplier of road emulsion
        without regard to whether the supplier was a
        'sole source,' and, therefore whether or not
        the competitive    bidding and proposal   re-
        quirements of the statute are met would be
        immaterial?   [Thus in original.]

     Section 262.001 of the Local Government Code provides:

           (a) The commissioners court of a county
        may appoint an agent to make a contract on
        behalf of the county for:

               (1) erecting     or   repairing   a   county
           building:

              (2)  supervising   the   erecting          or
           repairing of a county building: or

              (3)   any other    purpose   authorized    by
           law.

            (b) A contract or other act of an agent
        appointed under this section that is properly
        executed on behalf of the county and is
        within the agent's authority binds the county
        to the contract for all purposes.

     It is an elementary rule of the law of agency that the
acts of an unauthorized    agent do not generally     bind a
purported principal.   You argue in your request that the
commissioners court "has in effect ratified this contract by
subsequently accepting the benefits of the contract.1V     As
regards the emulsion purchase contract, we will not address
whether  or how the defective     agency relationship     YOU
describe could be cured so as to validate it, since we have
concluded in response to the first question addressed   above
that the contract was inherently defective   because it was
not made on competitive bids as section 3.211 of article
6702-l requires.

     County officials'    authority  is   limited to   that
expressly conferred or necessarily implied by the constitu-
tion and statutes. Wilson v. County of Calhoun, 489 S.W.2d
393 (Tex. Civ. APP. - Corpus Christi 1972, writ ref'd
n.r.e.). Here, we have concluded that the commissioners,
whether or not acting 'through the agency of the road

                                 P. 5306
Honorable James W. Smith. Jr. - Page 8   (JM-1027)

engineer, had no authority to contract for the purchase    of
the emulsion except through the taking of competitive   bids.
The contract is thus void.   It cannot be lVratified" by the
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.
Limestone Countv v. Knox, 234 S.W. 131 (Tex. Civ. App.      -
Dallas 1921, no writ).4

     We also note that the establishment       of   apparent
authority would   likely be precluded    on the facts you
present, since a person dealing with the engineer would be
deemed to be on notice that the $9,128.04 emulsion  purchase
was required to be made on competitive bids and that neither
the engineer nor the commissioners court had authority    to
make the purchase in any other manner.  See, e.o., Limestone
Countv v. Knox, suvra.

     Finally, in regard to your second question we note that
you ask whether the engineer's  not having been approved  as
agent under section 262.001 would "invalidate   any and all
contracts that the county had with a supplier       of road
emulsion."  Since your statement of facts does not refer to
any emulsion purchase   contracts  other than the one for
$9,128.04, we do not here address the validity or possible
validation of any other emulsion purchase contracts.     See
footnote 1, suvra.

     Two of your other questions deal with the construction
of and manner of applying the sole source exemption in Local
Government Code section 262.024. We need not reach these
questions inasmuch as we have concluded in response to the
first question  that section 262.024 does not exempt the
$9,128.04 emulsion purchase contract from the requirement of
section 3.211, article 6702-1, that it be made on competi-
tive bids.

     4. It would appear, however,   as you suggest, that if
the county has received the benefits of the contract,   even
though the contract is void for irregularities, the county
could be held liable in quantum meruit for the reasonable
value of the benefits received. Harris Countv v. Emmite,
554 S.W.2d 203 (Tex. Civ. APP. - Houston [lst Dist.]   1977,
writ dism'd); Womack v. Carson,   38 S.W.2d 184 (Tex. Civ.
APP. - Beaumont  1931), aff'd, 65 S.W.2d 485 (Tex. 1933),
aff'd on rehearing, 70 S.W.2d 416 (Tex.‘1934).

                              P. 5307
Honorable James W. Smith. Jr. - Page 9      (JM-1027)

     You also ask:

        [I]s there any civil and/or criminal liabi-
        lity on anyone's part if it is determined
        that this is an invalid expenditure of the
        public's money?

     Whether the circumstances of the emulsion purchase con-
tract may be grounds   for civil or criminal   liability  is
ultimately a question of fact, which cannot be resolved   in
the opinion process.

      Various provisions   of Texas law could possibly      give
rise to liability. They include section 262.034 of the
Local Government Code    (providing that a county officer or
employee commits an offense if he knowingly makes or autho-
rizes separate, sequential, or component purchases to avoid
the competitive bidding requirements    of section 262.023 or
if he knowingly    or intentionally violates     subchapter   C,
chapter 262 of the Local Government Code), section 39.01 of
the Penal Code (intentional or knowing violation by a public
servant of a law~relating to duties of office or employment,
or misappropriation of public property, coupled with the in-
tent to obtain a benefit or harm another), and perhaps      sec-
tions 15.05 et seq       of the Business and Commerce       Code
(contract, combinati&,    or conspiracy in restraint of trade
or commerce unlawful).    See also Bus. & Corn. Code, 55 15.20
et seq., (providing for offenses, penalties and suits). Al-
     at common law       unauthorized agent may be personally
%ble    to a perso; %,th whom he makes an unauthorized      con-
tract for the damages arising therefrom. See 3 Tex. Jur. 3d
Asency 5 162. We decline to speculate, however, as to what
factual circumstances in connection with the emulsion pur-
chase might give rise to liability under these or other
laws.

     Finally, we note that though you refer in your state-
ment of facts to the county auditor's refusal "to approve
the claims for the emulsion,l, citing Local Government  Code
sections 113.064, 113.065, and 113.091, your request poses
no questions with respect to the auditor's    action or the
construction or application of those provisions.  According-
ly, we offer no opinion on these matters.

                        SUMMARY

           Under article    6702-1, section    3.211,
        V.T.C.S., a contract for a $9,128.04 purchase
        of emulsion  for a county road under the

                                  p. 5308
Honorable James W. Smith. Jr. - Page 10    (JM-1027)

        court/engineer  system     must be    made  on
        competitive bids.    There  is no sole source
        exemption from the section 3.211 competitive
        bidding requirement, which    is applicable to
        such contract.    Such a contract must also
        comply with the competitive       bidding pro-
        cedures prescribed by chapter 262, subchapter
        C, of the Local Government Code.

                                     JIM     MATTOX
                                     Attorney General of Texas

MARY KELLER
First Assistant Attorney General

MU MCCREARY
Executive Assistant Attorney General

JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by William Walker
Assistant Attorney General

                              P. 5309