,.
THE ATTORNEY GENERAL
OF TEXAS
July 24, 1990
Honorable D. C. (Jim) Dozier Opinion No. JM-1189
Montgomery County Attorney
Montgomery County Courthouse Re: Authority of a com-
Conroe, Texas 77301 missioners court to award
l'desiqn/buildU1 contracts
Mr. Charles E. Nemir, P.E. for construction of pub-
Executive Director lic buildings on the
Texas State Board of basis of competitive bids
Registration for Professional and related questions
Engineers (RQ-1895)
P. 0. Drawer 18329
Austin, Texas 78760
Gentlemen:
Mr. Dozier advises us that the commissioners court of
Montgomery County is considering the construction of certain
public works through the award of so-called '@design/build"
contracts. His description of the design/build concept is
"the award of a single contract for both architectural
design and construction to a single contractor for a lump
sum fee."
Mr. Dozier asks the following questions:
1. Does the proposed design/build procedure
comply with the requirements of applicable
competitive bidding laws?
2. In light of article 664-4, V.T.C.S. the
Professional Services Procurement Act, does
the inclusion of architectural design
services as a component of the design/build
contract violate the prohibition on award of
professional services through a competitive
bidding process?
3. Assuming the application of article 249a,
section 16, V.T.C.S. must the preparation of
the required architectural plans and specifi-
cations precede competitive bidding to serve
as a foundation for bid specifications or may
P. 6267
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 2 (JM-1189)
they be produced following award of a
design/build construction contract?
Following receipt of Mr. Dozier's request, Mr. Nemir
asked that our opinion consider these issues as they relate
to professional engineering services governed by article
664-4, section 3A, V.T.C.S., and article 3271a, section
19 (4 , V.T.C.S.
The answer to these questions lies in an examination of
the commissioners court8s capacity to make the kind of
contract you describe. Before we can ascertain the court's
authority, however, it is appropriate to examine de-
sign/build construction contracts in closer detail.
The traditional design and construction services model
has been described as a linear relationship between the
architect, the owner of the project, and the contractor.
Block, As the Walls Came Tumblina Down : Architects'
Exnanded Liabilitv Under Desian-Build/Construction
Contractinq 17 John Marshall L.Rev. 1 (1984). This
also describes the contractual relationship between the
parties. In the traditional tripartite arrangement, the
owner occupies the middle position, contracting with the
architect and the contractor on either side. Id. The
relationship is represented schematically as follows:
Architect - Owner -Contractor
Under this arrangement, no privity of contract developed
between the architect and contractor. The architect is
described as having a fiduciary relationship with the owner
and acting as a channel of communication with the contractor
and arbitrator of any disputes. Id.
The design/build concept is a significant departure
from the traditional arrangement. Under the design/build
concept, the owner contracts with a single party for both
the design and construction of the entire project. Id. The
single party may be either the architect/engineering firm,
the contractor, or both acting in tandem as a joint venture.
Id.; Canterbury, Texas Construction Law Manual 5 6.09
(1981); Practicing Law Institute, Construction Contracts
m, 33-36 (1985). Viewed schematically, this is how the
relationship appears:
D. 6268
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 3 (JM-1189)
wrier
"r
Design/Build Team
Architect/Engineering firm and/or Contractor
&g Practicing Law Institute, sunra. The entity contracting
with the owner undertakes either to design and build the
entire project using the owner's financial resources and
present the owner with a finished product or to present the
owner with the finished product on a l'turn-key'U basis.1
Block, suvra, at 8; see, e.a., Seaview HOSD.. Inc. v.
Medicenters of America, Inc., 570 S.W.2d 35 (Tex. Civ. APP.
- Corpus Christi 1978, no writ).
The design/build approach to construction contracting
offers the distinct advantages of reducing the time
necessary to negotiate a contract for the entire project,
reducing the time required to complete the project, and
affording the owner considerable flexibility in the ultimate
design of the project. m Grant, A New Look at De-
Sian/Build, 7 The Construction Lawyer 3 (April 1987).
However, the design/build method also has its disadvantages.
For example, the arms-length relationship between the design
professional and the builder is eliminated. Id. The
traditional contracting method delegates various functions
to different contractors, creating what has been called a
"healthy tension" and installing a check-and-balance
mechanism into the process. Id. By combining the design
and construction functions, the design/build contract is
said to make the architect less of an agent for the owner
since he is essentially acting in partnership with the
builder. Practicing Law Institute, suora.
1. A "turn-key" project is one in which the contractor
agrees to complete the construction process to the point of
readiness for occupancy, assuming responsibility for design
of the project and for all risks, unless such responsibility
is waived or limited by contract. See Mobile Hous. Env'ts
v. Barton & Barton, 432 F.Supp. 1343, 1346 (D. Colo. 1977) ;
Gantt v. Van der Hoek, 162 S.E.2d 267, 270 (S.C. 1968). At
the time of occupancy, all that is required of the buyer is
that he simply "turn the key" to open the door. See
Glassman Const. Co. v. Marvland CitY~ Plaza. Inc., 371
F.Supp. 1154, 1159 (D. Md. 1974).
P. 6269
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 4 (JM-1189)
The threshhold issue underlying each of the questions
is whether a commissioners court may, on behalf of the
county, enter into a construction contract that includes
architectural services on the basis of competitive bidding.
Because the Professional Services Procurement Act, V.T.C.S.
article 664-4, prohibits the procurement of architectural or
engineering services through competitive bidding,
conclude that a commissioners court does not possess tFZ
authority to award a design/build contract for the
construction of a public work on the basis of competitive
bids where architectural or engineering services comprise a
component of the contract.
The authority of the commissioners court to make
contracts on behalf of the county is subject to well
established rules. It is axiomatic that the commissioners
court's authority is limited to that conferred either
expressly or by necessary implication by the constitution
and laws of the state. Childress Countv v. State, 92 S.W.Zd
1011, 1016 (Tex. 1936); Jack v. State, 694 S.W.Zd 391, 397
(Tex. App. - San Antonio 1985, writ ref'd n.r.e.). Con-
tracts made in violation of statute are void and not subject
to ratification by the commissioners court. Jack v. State,
m.
Section 3 of the Professional Services Procurement Act
provides the following:
No state agency, political subdivision,
county, municipality, district, authority or
publicly-owned utility of the State of Texas
shall make any contract for, or engage the
professional services of, any licensed
physician, optometrist, surgeon, architect,
certified public accountant, land surveyor,
or registered engineer, or any group or
association thereof, selected on the basis of
competitive bids submitted for such contract
or for such services to be performed, but
shall select and award such contracts and
engage such services on the basis of
demonstrated competence and qualifications
for the type of professional services to be
performed and at fair and reasonable prices,
as long as professional fees are consistent
with and not higher than the published
~recommended practices and fees of the various
applicable professional associations and do
not exceed the maximum provided by any state
law.
P. 6270
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 5 (JM-1189)
Parsing this provision to its essential elements, section 3
reads: "No . . . county . . . shall make any contract for,
or engage the professional services of, any licensed . . .
architect . . . or registered engineer . . . selected on the
basis of competitive bids . . . , but shall select and award
such contracts and engage such services on the basis of
demonstrated competence and qualifications for the type of
professional services to be performed and at fair and
reasonable prices.".
"Professional services" are declared by the act to be,
among other things,
those within the scope of the practice of
. architecture . . or professional
engineering as defined b; the laws of the
State of Texas or those performed by any
licensed architect . . . or professional
engineer in connection with his professional
employment or practice.
V.T.C.S. art. 664-4, S 2. The act thus prohibits the
procurement through competitive bids of services within the
scope of the practice of architecture or engineering, even
though the contract may not call for the services of a
licensed architect or registered engineer.2 Contracts for
such services must be made in accordance with the procedures
described in section 3A of the act. Contracts made in
violation of any of the provisions of the act are declared
void. Id. 5 4.
A commissioners court, or for that matter any entity
subject to article 664-4, is thus prohibited from awarding a
contract for architectural services, engineering services,
or any other service specified in the act, on the basis of
competitive bidding. Cf. Attorney General Opinion JM-282
(1984) (distinguishing contracts for the construction of a
building and contracts for the planninq of the construction
of a building; the former are subject to competitive bidding
2. Architectural and engineering plans and specifica-
tions for certain public works of a specified cost must be
prepared only by architects and engineers registered with
the state. See V.T.C.S. arts. 249a, 5 16 (architectural
plans for public buildings whose construction costs exceed
$100,000): 3271a, 5 19 (engineering plans for public works
whose cost is more than $8,000).
r
P- 6271
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 6 (JM-1189)
while the latter, which call for professional or consultant
services, are not). It follows that a commissioners court
lacks the authority to make a contract for the construction
of public works under the "desiqn/build01 concept when the
resulting contract is awarded pursuant to competitive
bidding and includes architectural or engineering services
as a component of the contract. The proposed design/build
procedure described in Mr. Dozier's letter is therefore
incompatible with competitive bidding laws.3
One argument marshalled in support of the design/build
procedure is that it can result in significant savings to a
county. Savings is, of course, one of the primary
objectives of the competitive bidding apparatus. The
courts, however, have recognized that when the acquisition
of professional services is involved, competitive bidding
may actually be detrimental to the public interest:
To hold that the [competitive bidding] act
would require that the services of a man
belonging to a profession such as that of the
law, of medicine, of teaching, civil enqi-
neerinq, or architecture should be obtained
only through competitive bidding would
qi;e'a ridiculous meaning to the act . . . .
Such a construction would require the
selection of attorneys, physicians, school
teachers, and civil engineers by competitive
bids, the only test being the lowest bid for
the services of such men. Such a test would
probably be the best that could be conceived
for obtaining the services of the least com-
petent man . . . .
3. You do not ask and we therefore do not consider
whether design/build contracts may be awarded without resort
to competitive bidding because they include architectural or
other professional services as a component of the contract.
This opinion should not be read as tacit approval of such
arrangements. s.!s suoerior Incinerator Co. of Texas v.
Tomnkins, 37 S.W.2d 391 (Tex. Civ. App. - Dallas 1931),
aff'd, 59 S.W.2d 102 (Tex. Comm'n App. 1933, holding
approved). Neither have you asked whether a design/build
firm which prepares architectural or engineering plans or
specifications for a public works project may submit a bid
the resulting construction contract. See Attorney
zzneral Opinions JM-940 (1988) ; JM-282 (1984).
FJ. 6272
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 7 (JM-1189)
Hunter v. Whiteaker & Washinaton, 230 S.W. 1096, 1098 (Tex.
Civ. App. - San Antonio 1921, writ ref'd) (involving a
contract for engineering services); see also SteDhenS v.
J.N. McCammon. Inc., 52 S.W.2d 53 (Tex. 1932) (architectural
services): Attorney General Opinion JM-940 (1988) (services
of a construction management consultant).
The legislature has incorporated this thinking into
competitive bidding statutes by enacting exemptions for
professional services. ee. a Local Gov't Code
S 262.024(a)(4). As for t:e &-&es covered by article
664-4, the legislature has gone a step further by expressly
prohibiting their procurement on the basis of competitive
bidding. Thus, while it might be argued that competitive
bidding statutes do not require, but at the same time do not
forbid, contracts for architectural and engineering services
to be awarded by competitive bids, article 664-4
affirmatively bars counties from awarding such contracts on
that basis.
Taking into account Mr. Nemir's request, the third
question becomes whether section 16 of article 249a or
section 19 of article 3271a requires the preparation of
- architectural or engineering plans and specifications in
advance of competitive bidding to serve as a foundation for
bid specifications, or whether such plans may be prepared
following the award of a design/build construction contract.
Section 16 of article 2~49a, effective January 1, 1990,
provides the following:
To protect the public health, safety, and
welfare of the citizens of the State of
Texas, an architect registered in accordance
with this Act must prepare the architectural
plans and specifications for a new building
intended for education, assembly, or office
occupancy whose construction costs exceed One
Hundred Thousand Dollars ($lOO,OOO.OO) which
is to be constructed by a State agency, a
political subdivision of this State, or any
other public entity in this State.
Acts 1989, 71st Leg., ch. 858, at 3839. A county is a
political subdivision of the state. Childress Countv v.
State, suora.
Section 19 of the Texas Engineering Practice Act,
V.T.C.S. article 3271a, provides the following:
P. 6273
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 8 (JM-1189)
(a) It is unlawful for this State or any
of its political subdivisions, including any
county, city, or town, to engage in the
construction of any public work involving
professional engineering, where public
health, public welfare or public safety is
involved, unless the engineering plans and
specifications and estimates have been pre-
pared by, and the engineering construction is
to be executed under the direct supervision
of a registered professional engineer.
However nothing in this Act shall be held to
apply to any public work wherein the con-
templated expenditure for the completed
project does not exceed Eight Thousand
($8,000.00) Dollars.
(b) This Act shall not apply to any road
maintenance or betterment work undertaken by
the County Commissioners' Court.
Neither section 16 of article 249a nor section 19 of
article 3271a by its terms requires the preparation of
architectural or engineering plans and specifications for a
construction project by a licensed architect or registered
engineer prior to competitive bidding. It has been
suggested that requests for proposals can be drawn with
sufficient detail to meet the requirements of competitive
bidding even in the absence of detailed plans and
specifications. Alternatively, it is argued that this
question requires the resolution of fact issues that cannot
be accomplished in an opinion of the attorney general.
It is quite true that determination of the adequacy
of bid specifications in a given case will require the
resolution of fact issues. Indeed, a noted authority
cautions that since it is sometimes difficult to know the
detail to which drawings and specifications must be carried,
competitive bidding requirements should be interpreted in a
manner that secures the object for which they were intended.
10 E. McQuillen, The Law of Municipal Corporations 5 29.53
(1990 rev.). According to this authority, it is not
necessary that plans and specifications show every minor
part or component of the structure to be built or product to
be purchased, only that enough detail appear as to make it
clear what is intended and what result is to be accom-
plished. Id. Another authority, on the other hand,
suggests that detailed design specifications are better
suited to construction projects than to product acquisition.
The Council of State Governments, State and Local Government
P- 6274
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 9 (JM-1189)
Purchasinq 45 (3rd ed. 1989). There are numerous Texas
authorities which suggest that competitive bidding requires
the preparation of detailed architectural and engineering
plans prior to the invitation of bids for a construction
project.
In his letter Mr. Dozier cites Headlee v. Frver, 208
S.W. 213 (Tex. Civ. App. - Dallas 1918, writ dism'd), a case
involving the award of a contract for the construction of a
county courthouse based only upon *Iatentative synopsis of
specifications and pencil sketches of floor plans and a
drawing of the building." He quotes language from the case
describing the role of the commissioners court prior to
inviting bids for construction:
[I]t occurs to us that they are put to the
necessity of being prepared to present to
those who may appear to bid upon the contract
some intelligent and concrete statement of
the work required to be done or the structure
tom be erected as would tend to induce
competition, depending in every instance upon
the character of the undertaking.
208 S.W. at 216. The court emphasized that without a
precise description of what the county required, no
responsible contractor acting in good faith could bid on the
project, and thus competition would be stifled. See also 35
D. Brooks, County and Special District Law § 18.7 (Texas
Practice 1989).
In another case, a court upheld the action of a city
board of commissioners that rescinded a contract for the
construction of an incinerator that the board concluded had
been awarded in violation of the city's competitive bidding
ordinance. The specifications for the project contained
several material omissions, including the size of the
building to house the incinerator, number and dimensions of
furnaces, size of flues, chimney dimensions, and number of
stairways and doors.4 Sunerior Incinerator Co. of Texas
4. In fact, the specifications called for the
prospective bidder to design the incinerator and to submit
complete working drawings covering the design with the bid.
The court, responding to this provision and citing numerous
authorities, adopted a broad rule: "A competitive bidding
(Footnote Continued)
P. 6275
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 10 (JM-1189)
v. Tomnkins, 37 S.W.2d 391, 396 (Tex. Civ. APP- - Dallas
1931), aff'd 59 S.W.Zd 102 (Tex. Comm'n App. 1933, holding
approved). The court defined "specifications" as "not only
the dimensions and mode of construction, but a description
of every piece of material -- its kind, length, breadth, and
thickness -- and the manner of joining the separate parts
together." L at 395-396. It concluded that under these
circumstances no complete specifications were drawn up and
adopted prior to the advertisement for bids. Consequently,
no two prospective bidders could bid on the same character
of improvement, making competitive bidding impossible. Id.
at 396.
Mr. Nemir cites Attorney General Opinion JM-282 (1984),
where we were asked, among other things, whether a state
university could solicit and receive competitive bids for
the construction of permanent improvements before plans and
specifications were completed, with only a general project
description serving as a guide to potential bidders. After
observing a distinction between bids for the actual
construction of the improvements and offers to serve as
construction management consultant for the project, we
answered the question in the negative. Our answer was
followed by these remarks:
A general project description of incomplete
plans and specifications will not furnish a
sufficient basis on which competitive bids
for the construction of a project can be
received As noted in Attorney
General Opinion H-24 (1973) a procedure does
not result in comoetitive' bids where bid
documents leave to conjecture requirements
governing the bids and only by happenstance
would all interested bidders arrive at a
common conclusion regarding their meaning.
See also Attorney General Opinion MW-299
(1981). (Emphasis in original.)
(Footnote Continued)
statute is fundamentally violated where the bidder is asked
to furnish plans and specifications, and an award made under
such circumstances is -void." Sunerior Incinerator Co. of
Texas v. Tomokins, 37 S.W.2d 391, 397 (Tex. Civ. App. -
Dallas 1931), aff'd 59 S.W.Zd 102 (Tex. Comm'n App. 1933,
holding approved).
P. 6276
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 11 (JM-1189)
The opinion then quoted the following language from Sterrett
v. Bell, 240 S.W.2d 516, 520 (Tex. Civ. App. - Dallas 1951,
no writ), cited with approval in Texas Hiahwav Comm'n v.
Texas AssIn of Steel Imoorters, 372 S.W.Zd 525 (Tex. 1963):
*Competitive bidding' requires due advertise-
ment, giving opportunity to bid, and contem-
plates a bidding on the same undertaking upon
each of the same material items covered by
the contract; upon the same thing. It
requires that all bidders be placed upon the
same plane of equality and that they each bid
upon the same terms and conditions involved
in all the items and parts of the contract,
and that the proposal specify as to all bids
the same, or substantially similar specifica-
tions. . . . There can be no competitive
bidding in a legal sense where the terms of
the letting of the contract prevent or
restrict competition, favor a contractor or
materialman, or increase the cost of the work
or of the materials or other items going into
the project.
P Admittedly, these authorities do not hold that final
architectural and engineering plans and specifications must
be drawn in advance of competitive bidding in every case,
but they make it clear that a particular bidding procedure
may be faulted for being non-competitive if detailed plans
and specifications are not prepared in advance. Further-
more, the award of a contract on the basis of nothing more
than a general project description might also alter the
duties and liabilities of the public entity and the
construction contractor. Cf. Board of Reaents of the Univ.
of Texas v. S & G Constr. Co., 529 S.W.2d 90 (Tex. Civ. App.
- Austin 1975, writ ref'd n.r.e.) (builder held not liable
for delays in completion of construction resulting from
owner's failure to provide builder with "correct plans and
specifications" and additional instructions and detail
drawings necessary to carry out work under contract; rather,
owner found in breach of contract, entitling builder to
damages).
Accordingly, neither section 16 of article 249a nor
section 19 of article 3271a expressly requires the
preparation of architectural and engineering plans and
specifications prior to the invitation of bids by a county
for a construction contract. But absent a provision to the
contrary, such a requirement is implicit in competitive
P bidding statutes.
P- 6277
Honorable D.C. (Jim) Dozier
Mr. Charles E. Nemir
Page 12 (JM-1189)
SUMMARY
A commissioners court is prohibited by
article 664-4, V.T.C.S., from awarding a
ndesiqn/buildl' contract for the construction
of a public work on the basis of competitive
bidding where architectural or engineering
services comprise a component of the con-
tract. Neither article 249a, section 16, nor
article 3271a, section 19, requires the
preparation of architectural and engineering
plans and specifications prior to the invita-
tion of bids by a county for a construction
contract. But absent a provision to the
contrary, such a requirement is implicit in
competitive bidding statutes. .
JIM MATTOX
Attorney General of Texas
MARY KELLER
First Assistant Attorney General
LOU MCCREARY
Executive Assistant Attorney General
JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General
RENEA HICKS
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by Steve Araqon
Assistant Attorney General
P- 6278