Untitled Texas Attorney General Opinion ( 1942 )

OFFICE OF THE A-l-l-ORNEY GENERAL OF TEXAS
AUSTIN
j@. D. C. Greer
Dear sir:
We acknowledge reoelpt af yo
upon the folkd.ng facttar
filed with the Dopart-
totallng 4226,432.&L
tiy h86 dd88a the cmi8-
sremmion ral&.+sesof osrtpln
th8 above mmiint aggreg8tlag
00.00, vhlah he till sut’ren&r to
e Departaent vlll.pay to the aon-
th. diff``~8 b4JtV*8n th6i tt.l88l
mimalnlng uwelecrsed alelm, oondi-
Deparhaant can pay ana the cantraator
accept such paylrrent
vlthout re~udioe to the right OS
th63oontractor to presetcuteL m olalm agalmt the De-
partluentfor aaaltlonal ooIAp8MatlQn, graving out of
the oonstruction OS tlm projecrt,erd wlthmt pnjudiecr
to the rights of the Dsparbwnt undm the oontraot to
lnterpoce ang UeSenmem to Qua payment to muoh ~l.alm
Beno~able D. c. meer, gage 2
whloh it nov has. The claim referred to is ID the
approximate amount ot $590,000.00 Sor eddltlonal oom-
peneation, filed by the contra&or upon ccmpletlon OS
the pro&at.
"In this oonnootlon you are referred to Section
33 Of the Contra& SpOifiWitiOn8, which reeds as SOI-
lovat
"'9~ or nbout the flrrt day of the iuonththe En&-
neer vi11 ertiuste the valw of materlalr delivered et
rite end vork done. Y1thS.nfifteen deya thereafter
ninety per 08nt of the value thue detenelned 1888 PI%-
tiow ?Rp8Pte shall be paid to the Contractor.
"'When the emount8 80 re8erv.d rhall equal five
per oeat of tke total OS the oontpaot pins the prob-
able mount of any liquideted damages apparently ao-
amaulated monthly estimates thereaSter vlll be paid in
sull. The rohedule pa-teemto be emplajed In making
partial payment8 8hall be determined W the Eaglnee~.
"IIf &tring the progresr OS the vork it appear8
that the Contractor's bills for material* and labor are
not being paid, the Oimer e&all have the right to vfth-
hold Srcn8the Contrastor monthly papaents 8ufSfulaat
8``8 to protett ItaelS sgsLa8t ell lon8es SroanpQa8ible
lz$i~bgz to 8pplp the oata 8~ to the payment of
. Payseatr of monthly s*tlpster UFO agreed
not to be aa admlr8ion by the Ovaer tht the work 18
a- or that it8 qwntity or qw.lity I8 cutisfactory,
nor a releare of betaContrastor fron msponrlbllity in
reapeat thereof, but 8wh release 8ball ooaur only with
maal paymeat.
@uotia
the Cont*actQr fail to eon&et8 the work
vithin the t3.m epeeilied, the Owner ahall not be ob-
liged to make any payments on monthly or partial esti-
8mtes after the datee 8peolffea for oorapletlonwtll
the Contractor r$all deliver to the I&n&.neerthe vrit-
ten eaa*ent of the Cozxtreotor~8Bwety eovaring every
suakipartial payment peraittfng *u&i ~ymenta to be
ma& tithout aSSeating the validltb of th@ bond.
"Wptm ooraplstlonof the QntlrQ work of the oma-
treat and aooeptanoe thereof, in vAt3.q by the CRmer,
Honorable D. 0. &em-, Page 3
k&b ranalder due the Contraotor shall be paid, vhich
shall be the total cmtpensatlon less ~MVIQW payments.
"'The total compensation shall be dete,zM.nedby
the final aotual number OS 8OeOptable units classIfYed
In the proposal and bid r-t the unft prices and lump
prices bid, plus any allovanoe or added payments, less
an.yamounts of liquidated damages OP other deductions.
"Before the final ssyment is made, the Contractor
shall ahov the Ovner satI*Saatory evlcbnoe that all Just
liens, olslms aad d8manda OS his employees, and of par-
tie* from uhcm msterIal* used in the eonatructlonof the
vork may have been pumhared or procured, are Sully
rat18SIedd,and that the struoture Is fully relsared from
all such llena, claim and demands.
"'The aoceptance by the Cantraotor of payment of
the final estlmatr shall operate as and shall be a re-
lease to the Owner, the Engi.neerand all agents thereoi,
frcm all Olaims or llablllty ua&er tb# QontraOt for
everythIng done or Suralmhed, either relating to the
vork tlw uader the oontraot or Sor w aot or neglect
of 8ald Dvner, Engineer, or any of their agents or em-
ployees related to or Oonuected vith the Oontraot.
"%Q paymeats, either partial or f-1, are to be
redo for nny nmterla2.whioh is to be tued Sor Salswork
0~ #ant, but payment Is to be made only Sar materlalr
uhloh are left permanemtly in the fltt.lshetl
structure
aad fom a part of It.!
"The Hlghvay cQlmsis*1onhas e.spre**edits willlag-
nose to pay to the aontzwtor thedlffexwnce bstussn the
SInal esttnvte aud the unreleased Labor urd material-
mom elalms, as requested by the ttQnt.motOr,if it Oaa
be done vlthout prejudice to the rights of either party,
as SbQV8 stated.
"Will you please adviue me If, in your ~pinian, the
Hlghvay Cml*sIon, under the above qwtsd eeetioa of
the Coatract SwelfLeatiQns and vlthout prejudloe to the
rlghta of either party to the uontraot, may pay to the
aontractor the dlfSerenc8 betvesn the emount of mosey
Cue the contraotor under the PInal eatlmate eMx the labor
fIon@rableD. C. Qreer, Page 4
materirlmerm claims rema- unpeld and urmelea8ed.
Also, will you plee8e advi8e me if It till be neoee-
aory to obtain the aomant. of the contractor13 sure-
ty to any much arrangement if, in your opinion, it
OaA be made.”
%‘heoontraat in question WAS sxeouted unber authority
of Houee i-3111
9. Forty-third Leginleture of Texao, Fourth Celled
sesuicm, Chnpter 32, Page 78. said bLl1 agsc%flaally authorize8
the St&e Highway Commlrsion to &wisp, supervire sad aarutruat
m to oontraot for the derigning, 8UperV18ioIiand the COA8tE'Ua-
tlan of suah bridge8 and the approaeher thereta.
It 18 fUl%~UAttsl that til hW8 lfhbh 8Ub818t at t&O
tlae and plaoe of the maw of a aontract and where it Ls to
be periarwd, enter into and forn 6 part of it, a8 if they oera
expre88ly referred to or incorporated in its temao. Winder
Brothem vs. Sterling et al, 12 S. W. (2d) 127.
A8 noted in JOSW l%QllWt, 01&l iA the 8M) Of $2Z!6,432.-
gibave been fil~vitht````DepartPrent``lnst the oontrao-
. Artlole 5160, 8Upm. a8 ameuadadby tb Forty-first tigi8b-
ttwe, page 481, Chapter 226, seation 1, pmouldes In part ~8 Sollovar
'Provided further that after completion and %a-
ceptanoa af eo@leted project al;lMonet due eentrae-
tar under mid oantraat aha= be hold by the State
or it8 oouAti68 or 8ohuol dkstrfotll OF other mibdl-
ri8lon8 thereof or any maalolpallty unt1.leueh a time
that aat%efeetarj eoldmoe 16 sukultted and affldavita
m&e by the contraotor that all just billa for labor
and material wader th&8 aontraot ha8 b8eA paid ln full
by the aomtraotor."
In the ease of Republic RatLoml l32uikaad Trust Company
V8. I&b8Sr. 8.
& IAS. CO., 68 Fed. (2d) 448, the Clmult Court of
Appeals, speaking through Justiae SSbley# in dZsaussiag 8aid Arti-
ale 5160, saldr
*The Act Of 1929 + * l 8melidedthe bond etatuts
md dealt only vlth the final paymnt, requlrin& it
to be vlthheld Abt in part to ooveg any porttoular
claln, but eAtire until 8 raquired affidavit la nab.'
Artlale 66741x,supm, pmvfdas In part $6 follovs~
ganozlsbleD. C. Qmer, Page 5
'And fipsl mgaQnt&Un AOtbeaadb until it
la of money dw for sag labor,
8hOVn that all 81a118
wtiFial8 or Oquip?iOAtfUrA%.rhedfor the pUrpo8e Of
such iarprovement8made under Amy suoh w&root have
been paid."
Ill the W8Q Of wb8tOA t WOrka V8. &JAM~ 57 3. x.
(2d) 258, the aowt held that Artlele 5160 and Artlule &67&n vere
in par1 materio.
'PhQeffeot of tba8e statute8, themfam, i8 that U~OA
the aompletlon and acoeptanoe of a pub110 work woh a8 highway
OP br5dge OaAstrUctioA, the f-1 payment dw tha crontraatorfor
mob vowk 8hal.l not be made until lfflda vit8 and other 8ati8faa-
tory proof 18 made by the oontreutor that all Obipr8 have bWA
p*ia*
!l%e vriter ha8 been lnSoxwed by the State IUghway Depart-
wnt that on %ovembsr 23, 1939, the aontraator wa8 notified Jm
aitlng, a8 provided in the aontraet, that the projeot had been
oompleted and wae thereby aaaepted.
YOU are thOrOfOlr8adV180d that it i8 the OpiAbbA Of thi8
department that the State %t.ghvsyCCQIU``SI~OA
irrnot authoF~6ed to
pay ovor to the oontractor the tllfforenoebetween the emaunt due
and the FwalAhg lanreloa8od alalm.
IA vi4811 0r our an8ver a8 above 8fA@d, it 18 not w008-
mwy for ,us: to tmmfer your qwstiw a8 to whether or not it la
AaaaraarJ.~toobtain the aaAs:en~t af the aoAtroetQr’8 8urety mdor
any 8wh arrangemeat.
YQum veFy truly