Untitled Texas Attorney General Opinion

                  OFFXc& OF !IXE&TTORHfXOEpDpRAL
                                              OFTEXAB
                                     BUSTS%
Cterald
      C. Mann
AttorneyGeneral




         HonorableC. D. Siolplonrr,
                                Co~~ptrollor
         sttigty      2bartt
              1
         DserSlrl~                    Ritt~n~e;tFuel
                                          oontttruotion
                                          No. 04938
                                   op5.nion
                                                     of ma-
                                                     compaw   :
                                                      .
                 We have your lettsr.ofFebruary19, 19433re-
         qwstlngour oplniorkoonstruiagoertaiapr,rovislcms of
         a oontraatbfotween Tha Mollleater
                                         Fuel Companyand The
         Stateof Texas coveringthe flsaelyear 1942-43,from
         whleh letter we quoter
                ~%he MoAlesterFuel Capany, dth enoral
             02ftoeaet EWlerCter,Oklahcmatand wi%l other
             offlaerrat 3002 sunlus street Dellat,Texas
             and also at R0okiW.e Teas &as the oonWa&
             for iurniehLnglign& to l&e Unlversltyof
             Tsaaars             year 194243. In pore
                   for the fittaal




Y            t&arm la .nota pro er one aoctordlqto
             dttrunderof;sndingo
                               P theoontraot. Tha q3m-
             pttnyhas replIedthat the ahergeIs e
             one In aooordenoewith thc~a4tntraote
             we have your offloial    ad-rho on the
                  n * + +,w
HonorableC. D. Slmnons,Page 2


                  provisionsof the aontraotln question
         Pertinfant
are the followinga
       "The Party oftthe First Part hereby oontraota,
           binds and obligates%tself to furnishto
    %%iversity    of Tems 6f the State of Texas




    ~omftE~ioTtyooitheBeaartdPartt;hroughallt:
    the perladooveredby this eontreot,




        w*+**
        * + * * All lignite to be of go@ gram
                 ta ot.not lass thfl 10


                                                on
                       Page 3
HonorableC. D. Sialptoas,


        "The said Uhlversltyof Texas end the Stats
    of Texan agree to pay to The laiilesterFuel
    Companythe sum OS One Dollarand Seventy-three
    Cants ($1.73) per ton F.O.B. Austin,Texas f'or
    each and every ton of llgnltedelivereduuder
    this oontreat. The above prlaa of Oua Dollar
    end Seventy-three Cants ($1.73) per ton for
    all Ligtitkdeliver&dunder~thisoontradtshall




        "It la understoodend agreed that in the
    *Vent the unitedStates of Awrlaa or the State
    of Teht imposesa .saverenoo      hx or other direat
    tax on Ligniteduring the liie of this ~o&tra&,
    aad the Sellerhas to ay the tax, that SW&
    tax will be added to tEe Sellers     priae on L+
    nlte.
        n * * **
        "It is furtheroontraotedand agreed that*
             breaahof the terms of this oontraut,




        "1chisaoutraothas bean gntaredinto by
    authorityoi?e~rasolutioudurJI~entered iut@
    by the Board of Controlof the State of Terns,
HonorableC, D. SImmoas,Page 4


     after cellingfor bids and advertisements
                                            thera-




         EXHIBIT   At   Conditionsof ProwsaL a@
                        sDeaifL'ioationa
                                      for llanL* .
         %XHIBIT Bt      Id of MoAlesterFuel CO~IJ~Q.~
                           phesis ours)
         Tha pertinentpart of the bid referredto In the
above quoted -p?or;tions
                     of the oontraatreads.




         The general pule that writings whlah am either.
enuexed to or referred tie in a aontre& will be am&rued
as e part 0~s the aontraotis well stated In 17 C.J.6.
716, 8eoI 29%
         A cursory examinationof the oontraut,~fromwhluh
wo have quotbdoo ioualy,diaoloaes the feat that almwt
every provlaiontierein oontelnadis referableto end
dependentupon the terms end aondItionsof the *%paaifiaations,
proposalsendbid*nhiohare "medee pert" thereofby
reSinmoe end are enwxed theretaes Erhlbll% With&at
suah axh%bItsit la crlearthat the eontreatis lnaomplete.
Werower, the aontreqtoontaipa its own 8peaiilorule
of construction req&r%ng that the exhibitsshellbe eon-
atruades pert thereoft "the terms of this * * * oontreot
shellbe aonstruadto inoltade spealfiuetlons, bids and
propose18oonneotedthercrvith end heretoettachedW.
HonorableC. b, Simuons~Page 5



        It is fundauentalthat 3.naonstruingcontraots
effeotail1 be iven to all provIsionsthereincontained,
If possible. If is likewisefundamentalthat the expressed
inteotof the c6ntraatingpartiesmst be given effeot.
         We think that under the rule of uonstruationlaid
down In the aontracti&elf, the provlslonsaontainedin
the specificationsbid and proposalsmst be given the sam
*eight,and that &ey are of equal rorae and effeatof any
other provisionsoontalnedIn the aontraat. Unless thke 3.8
some ambiguityor eonfliatbetweenthe variousprovisions
of the aantract,no construatlonis needed. We find no
such aonfliatand no suah ambiguityes to justirya aon-
structionof the aontract. It is clear and expllaitwith
referenaeto the matters thereinoontalned. 1tspeolf@aUy
providesthat In the event of au lnareaseor deareaseIn
freightrates or of Federal taxes thereon,that the prioe
providedfor in the eoattiaotshallbe increasedor deareased
acoordinglp.
             therefore advfaeyou that if-the frei f
         Vtilel
rate has increasedor 1f the Federaltaxes thereon e Y8
increasedthe sellerls entitledto add Such Auareaset0
the priae of the     te end the pur&aser uuder this aon-
treat,Ss.obllgated~
                 Y   pay such additionalan&m!&, W
veraely,~if suoh.rekesor taxea should be dimepjed then
the purahaaerwould be entitledto have the advantageof
such decmase in the price peld?
         Our ittentionMa been aalled to the cases of
JohnsonV* Grand Fraternity+255 Fed. 929 and Delanray ve
Fefnt%rsSiiate~    115 8.8. (26~ 736, We think that
              ?3enlc,
neitherof suuhoeaes la In paina here, The Jc&xrison 0888
is authorityfor the generalpropesitlonthat the state-
ment%hat the exhibit14 #made a art" of a tm&raati;  ir
not aontrolling,a@ that~where,&It pZ’OViS$~lN of the ,&an-
treatand those of the arhlbitare in ednflictt the prbc
visionsof the aontraotwill oo&reL Th* Ddla~y O~SI)
did not involvean exhibitat all but a eneml referenae
ta oontraotsbetwen other parties,and fhe ooart h&d
HonorableC, IL Binanon5,
                       Page 6


that suuh generalzyferenoeoould not have the effectof
substltutlng the provlslo~ of the oontraotreferredto
Yor the speaifieally expressedprovisionsof the oontract."
We have neitherof suah f#ltuationnpresentedhere.
         On the aontraryt the contraatbeforeus speolflaally
 rovldesthat it shall be oonstruedto "iAaiUdespeoiflcatlona,
 Ids, and proposalseonuectedtherewlthn.We can no more
ii
disregardthis provisionof the ooatraatthan we 06~1dis-
regardany Other prOVhiOA theIWinoontained,
          It has alla0been suggestedthat the portionof
 the bid providingfor the add%tionto t&e sellingprioe of
.an lnarease,offreightrates or Pederaltaxes is %n ao~-
 fllctwith that portionof the oontraotwhloh providesthat
 lf State or Federal%everanae taxes or other directtaxes"
are leviedupon llgnite",~  and sellerhas to pay such taxes
the mount so paid shall be added to the sellingprice be-
cause It .lssaid that only ~~~evcmnce or other dlreat&es
on lignite*were %A the m$nds of'the aontraatingpatiies
and that such revision superuedebthe said provisionIn
thebld. To &a we cannot agree for the reason that it is
oboioua~that  a Federal.tax upon fzelghtrates mentionedln
 the bid is neithera %mveranqe tax",norIs It any "other
dhwt tax upon llgA%W. The two are altogetherdifferen
aAddietiAt?t*Furthermorehaving lnoludedthe provW.en
for the addltlonof such transportation  taxes in the bid
whiahjunder the speclflolrnguageof the aontraot,must
be construedae a part of It, It ,wasnelther~neoessary
nor desirableto reiteratesucrh~provislon  in the addltlonal
writ+&
         Aguln it Is sugge8teathat the Z?OV.tSfOA
                                                ~Shat"all
tracesrtatlon’aharges  must be prepaid4y the geller.,lrIn
OOACLp"
      at ulth -theprovlsianthat lnoreasedFederaltrans-
portationtaxas'shallbe added to the price, The bid was
~made.FcO.Birtustin,Texa& It dleems fairlyobvlouathat
all partleato the oontraat,at all times,axpeatedmtlLer
to pey euah izansportotl6n tiger.   Thla, however doe8
not, ia the leastBkilitate agnhUt 0Ur co~~hIsioAiha%
ther? in no%kfllat In auuh provisions. It ls'equallyas
xonorableC, 9, %BEWSU% Pm     7


obviousthat if the pax-tier,   hadUoAtemplatedpaymeAtof
transportation ehargeaby the buyer there would have been
ho reasonand ho jU8tificratioA   for adding an increase in
such charges to the sellingprioe,nor would there have
been any reason for the provisiondeareaslngthe selling
prlae in the event of a dearease in euah aharges.
        n?ustingthat the above fully answersyour in=-
quiry,we are
                                     Very truly yours :
                                  ATTORWHYOEWSRALOF TEXAS

                                  By /is/ Forler Roberts
                                            i?ow~~ler~tts