September 10, 1990
Honorable John B. Holmes, Jr. Opinion No. ~~-1218
Harris County District Attorney
District Attorney's Building Re: Authority of a local
201 Fannin, Suite 200 governmental body to pay
Houston, Texas 77002 for an item purchased
under contract executed
prior to the effective
date of section 140.003
of the Local Government
Code (RQ-2017)
Dear Mr. Holmes:
You ask whether section 140.003, Local Government Code,
applies to a purchase, made with funds administered by the
district attorney under article 59.06 of the Code of
P Criminal Procedure, where the contract was executed, and the
goods delivered, prior to the effective date of the
provisions of section 140.003, but payment has not yet been
made. The provisions of section 140.003 were added in 1989
by section 1 of House Bill 1434. Acts 1989, 71st Leg., ch.
1250, 5 1, at 5046. Section 22 of the act provides that the
act takes effect September 1, 1989.
Section 140.003 requires that a "specialized local
entity," defined in subsection (a) to include a "district or
criminal district attorney," "shall purchase items in
accordance with the same procedures and subject to the same
requirements applicable to a county under subchapter C,
chapter 262" of the Local Government Code. Subchapter C of
chapter 262, known as the County Purchasing Act, imposes
detailed requirements on county purchases, including the
requirement that, with certain exceptions, purchases over a
certain amount be made pursuant to competitive bids or
proposals. See Local Gov‘t Code g 262.023.
Presumably, the cause of your concern is that the
acquisition in question was not made in accordance with the
the requirements of the County Purchasing Act, which section
140.003 makes applicable to district attorney purchases as
of September 1, 1989. YOU indicate that since the
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Honorable John B. Holmes, Jr. - Page 2 (JM-1218)
performance of the parties was not completed, by payment,
prior to September 1, 1989, payment has to date been
withheld out of a concern that making payment for the items
after September 1, 1989, would violate section 140.003.
It appears that at the time the contract in question
here was executed and the items delivered, purchases with
district attorney funds administered under article 59.06 of
the Code of Criminal Procedure were not subject to the
competitive bidding and other requirements of the County
Purchasing Act. Article 59.06 provides for the disposition
of forfeited property by law enforcement agencies. See art.
59.01 et ea Code Crim. Proc. (seizure and forfeiture of
property tsed'or intended to be used in the commission of
certain offenses, or of the proceeds or property acquired
with the proceeds gained from the commission of such
offenses). Attorney General Opinion JW-783 (1987) indicated
that purchases with forfeited funds, under V.T.C.S., article
4476-15, § 5.08, (now article 59.01 et sea Code Crim.
Proc.) were not subject to the reguirements';f the County
Purchasing Act, then found at article 2368a.5, V.T.C.S.
You do not raise or provide us with sufficient facts to
address issues as to the propriety generally of the use
under article 59.06 of forfeited funds for the acquisition
in question. We address here only the narrow legal question
you raise: whether the purchase by the district attorney of
items for which a contract was executed and of which
delivery was taken, prior to the effective date of the
provisions of section 140.003, but for which payment was not
made before such date, is subject to the provisions of that
section.
You suggest that application of section 140.003 to the
transaction in question would violate the prohibition in
article I, section 16 of the state constitution on
retroactive laws or laws impairing the obligations of
contracts. See also U.S. Const. a*. I, 0 10.
Assuming that the August 1989 contract in question was
validly entered into and delivery of the subject merchandise
properly taken in August, under the laws then in force,
agree that application to the transaction of the subs::
guently effective provisions of section 140.003 -- so as to
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Honorable John B. Holmes, Jr. - Page 3 (JM-1218)
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prevent or make subject to injunction,1 the purchaser's
performance, by payment of its obligations arising from such
contract and delivery -- would violate the prohibitions in
article I, section 16 on retroactive laws or laws impairing
the obligations of contracts. See. e.a., Hutchinas v.
Slemons 174 S.W.2d 487 (Tex. 1943) (broker's oral contract
entered'into before effective date of statute of frauds
pertaining to such contracts not subject to statute of
frauds); Cardenes v. State, 683 S.W.Zd 128 (Tex. Civ. App. -
San Antonio 1984, no writ) (statute authorizing surety to
receive a remitter of its bond under stated circumstances,
was enacted subsequent to bond forfeiture in case and, since
it would impair rights acquired by state under laws at time
it entered into contract with surety, was not retroactive in
application). See u 173 S.W.Zd 200 (Tex.
Civ. App. - Eastland 1943, writ ref'h) (broker's contract
antedating statute of frauds provision): Attorney General
Opinions JM-897 (1988) and JH-774 (1987) (imposition of fee
by Veterans Land Board for delivery of paid-in-full deeds to
purchasers under contracts not contemplating imposition of
such fee).
That the contract in question here was made by a public
entity does not remove it from the scope of the prohibitions
of article I, section 16 of the Texas Constitution. Fazekas
V. iversitv of Houston 565 S.W.Zd 299 (Tex. Civ. App. -
Houston [lst Dist.] 1978: writ ref'd n.r.e.), m. denied,
440 U.S. 952. Nor, we think, would application of section
140.003 to the transaction in question be in the nature of
an exercise of police power or change in procedure or
remedy which might be permissible under article I, section
16. See. e.a., Caruthers v. Bd. of Adiustment of City of
Bunker Hill Villaae, 290 S.W.2d 340 (Tex. Civ. App. -
Galveston 1956, no writ) (zoning); Commercial 0. of
Newark. N.J. v. Lang 480 S.W.2d 781 (Tex. Civ.' -
Dallas 1972, writ r;f8d n.r.e.) (retroactive law A%ing
procedural or remedial change not invalid unless it impairs
vested rights or takes away or unreasonably impairs
litigant's remedy, right of action, or defense).
It might be suggested that the parties to the contract
in question here were on notice at the time of its execution
1. &9 Local Gov't Code 5 262.033 (taxpayer may enjoin
performance of contract made in violation of County Purchas-
ing Act).
-
.
p. 6442
Honorable John B. Holmes, Jr. - Page 4 (JM-1218)
in August, 1989, that the provisions of section 140.003,
approved by the governor on June 16, 1989, would take effect
September 1 1989. Addressing a similar situation, with
regard to aA act taking effect 90 days after adjournment of
the legislature, the court in purser v. Pool, 145 S.W.Zd 942
(Tex. Civ. App. - Eastland 1940, no writ) stated that
passage of an act does not give contracting parties "notice
of anything. It did not operate as notice until it became a
law ninety days after adjournment."
Again, we conclude in response to your question, that
application of Local Government Code section 140.003 --
requiring that district attorney purchases be made in
accordance with the competitive bidding and other reguire-
ments of the County Purchasing Act -- to a district attorney
purchase for which the contract was executed and delivery of
the subject merchandise taken prior to the effective date of
the provisions of that section, would violate the prohibi-
tions in article I, section 16 of the constitution on
retroactive laws and laws impairing the obligations of
contracts.
Application of Local Government Code
section 140.003, which requires that district
attorney purchases be made in accordance with
the competitive bidding and other require-
ments of the County Purchasing Act, does not
apply to a district attorney purchase for
which the contract was executed and delivery
of the subject merchandise taken prior to the
effective date of the provisions of that
section. Application of that provision in
such situation would violate the prohibitions
in article I, section 16 of the constitution
on retroactive laws and laws impairing the
obligations of contracts.
JIM MATTOX
Attorney General of Texas
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Honorable John B. Holmes, Jr. - Page 5 (JM-1218)
MARYKELLER
First Assistant Attorney General
Lou MccREARY
Executive Assistant Attorney General
JUDGE ZOLLIE STEAKIXY
Special Assistant Attorney General
RENEA HICKS
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by William Walker
Assistant Attorney General
p. 6444