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                                        February 11, 1966

           Honorable Herbert Middleton                   Opinion No. C-607
           County Audltor
           Taylor County Courthouse                      Re:   Whether Taylor County
           Abllene, Texas                                      can legally pay a
                                                               short-rate cancellation
                                                               premium on an "error'
                                                               and omissions" insurance
                                                               policy procured and
                                                               cancelled under the
           Dear Mr. Mlddleton:                                 stated conditions.
                     Your recent letter to this office contained the
           following statement of facts:
                                "After the passage of Section 4 of Article
                           1937 as provled for by Section 1 of House
                           Hz;,;;5, Acts 59th Le islature, 1965 Regular
                                    Ch. 456 p. $1    an 'errorsand
                           omlsslo~s~ insurince policy was issued to
                           ?$$r   County for the benefit of the Cotinty
                                   On receipt of a copy of Attorney
                           General's Opinion #c-536 the policy on
                           which the premium had not been pald,'was
                           returned by the County Auditor to the
                           Insurance agent for cancellation.
                                "In a lett$r (copy of which is enclosed)
                           to the Hon. County Judge the agent requested
                           the County to pay a short-rate cancellation
                           premium. . . ."
           You have asked the opinion of this office as to whether Taylor
           County may legally pay the short-rate cancellation premium
           submitted by the agent who issued the policy.
                     The policy in question was procured pursuant to the
           provlsions.of Section 4 of Article 1937 as enacted by Section 1
           of House Bill No. 125 Acts 59th Legislature 1965, Regular
           Session, Ch. 456, P. 441, which reads as follows:




                                                  -294-2-
Hon. Herbert Middleton, page 2 (c-607)


          “Each county clerk shall obtain an errors
     and omissions Insurance policy, If the same be
     available, covering the county clerk and the
     deputy or deputies of the county clerk against
     llabllltles Incurred through errors and omissions
     In the performanceof the official duties of said
     county clerk and the deputy or deputies of said
     county clerk; with the amount of the policy being
     in an amount equal to a maximum amount of fees
     collected In any year during the previous term of
     office immediately preceding the term of office
     for which said Insurance policy Is to be obtained,
     but In no event shall the amount of the policy be
     for less than Ten Thousand Dollars ($10 000). The
     premiums for said insurance shall be paid out of
     the funds of the county by the Commissioners Court
     of said county."
          The clear and unambiguous language of this Section 1s
devoid of any expression which would make the respective countle
of this State responsible In damages for the errors or omissions
of county clerks or their deputies. The procuring of a policy I
of public llablllty Insurance cannot create a llablllty where i
there Is none. Texas Prison Board v. Cabeen, 159 S.W.2d 523
dE;a;~.App. 1942,berror ref.); Jones v. Texas Gulf S5ulphur <
   p y, Houston Court of Civil Appeals (Dec. lb, 196 ).
          Section 52 of Article III of the Texas Constltutlo.
provides In part as follows:
          "The Legislature shall have no power to
     authorize any county, city, town or other
     political corporationor subdivision of the
     State to lend Its credit or to grant public
     money or thing of value in aid of, or to any
     Individual. . . ."
          In Attorney General'sOpinion c-506 (1965) we helc
Section 1 of House Bill No. 125 invalid because of this pro-
vision of our Constitution. We stated In said opinion that:
          "As It would be In violation of Section 51
     and Section 52 of Article III of the Constitution
     of Texas for a county to pay a claim of a person
     for a loss suffered by such person for some act
     of the County Clerk or his deputies In the
     performanceof their official duties, It would
     likewise be a violation of the same constitutional
     provisions for a county to pay the premiums on an

                            -2943-
Hon. Herbert Middleton, page 3 (c-607)


     Insurance policy which had as .ltspurpose the
     paying of a claim predicated on facts which
     generated no county llablllty. In this same
     connection It was stated In Attorney General's
     Opinion No. O-1922 (1940) that:
          11
           t. . . It'is fundamental that the
     county would have no authority to Insure
     against a non-existent llabillty.~n
          In this context the language of.the Court In Clotigh
V. Worsham  74 S.W. 350 ($ex.Clv.App.1903, error ref.) at page
354 Is most appropriate:
          11 ,
            . . . /T7he government Itself is not
     responsible for the misfeasances or wrongs or
     negllgences or omissions of duty of the sub-
     ordinate officers or agents employed In the public
     service, for It does not undertake to guarantee
     to any persons the fidelity of any of the officers
     or agents whom it employs. . . .I"
          Statutes which are contra to the provisions of our
organic law are void. They are no laws at all and therefore no
rights may be acquired under them. Neither may acts or powers
performed under an unconstitutionalstatute  be justified or
sanctioned upon the baals of Its provisions. 16 Am.Jur.2d
403-404 ConstitutionalLaw B 177; 9 Tex.Jur. 467, ConstltGtlona
Law B 51; 39 Tex.Jur. 21, Statutes 6 8.
          "The foregoing rule has been deviated
     from by this court where It was shown that
     parties had obtained judgments In causes and
     the Legislature had enacted what was called
     Stay Laws, prohibiting the issuance of
     executions thereon for a certain period of
     time and where it was also shown that the
     partieshad obeyed the law before it was
     declared Invalid; and such rights acquired
     In such judgments are not destroyed by the
     period of limitation prescribed In such
     laws. Phillips v. Lesser, 32 Tex. 741;
     Sessums v. Botts 34 Tex. 35; Cravans v.
     Wilson 35 Tex. $2; Id    4I3Tex. 324; Townsend
     v. Q&an, 36 Tex. 548i'Delesplnev. Campbell,
     52 Tex. 4.
          II
           . . .


                           -2944-
Hon. Herbert Middleton, page 4 (c-607)


          "We think there exists a sound distinction
     between a decision which holds that rights
     acquired under a judgment will be protected from
     limitation, where the parties obey a law before
     It Is declared void, and a decision which holds-
     a sale made under a void statute conveys no title
     to the land. In the first Instance the legal
     rights of parties already acquired are protected
     In spite of a void statute; while In the second
     Instance, If the sale of land under a void
     statute were sustained, the partles would not
     only have their rights already acquired protected,
     but would also gain rights under a void s,tatute.
     This court has held, and still holds, that
     original rights obtained under a judgment will
     be protected in spite of a void statute, but
     It will not extend the rule to protect rights
     acqulred.undersuch void statute." Sharber v.
     Florence 131 Tex. 341 115 S.W.2d 604 (1938)
           66f7of 115 S W 2a* see also Sessums v.
     i&k,   34 Tex. 335'(i8$).
          In the case before us, the sole authority for the
procurement of the policy of Insurance and the payment of the
premium by the county Is the statute which we have heretofore
held unconstitutional. The fact that the policy ln question
procured and remained In force for a period of time prior to
our holding cannot supplant the absence of authority to pay
premium. We can find no valid basis to support the payment
the premium apart from the unconstitutionalstatute, therefo
the exception to the general rule stated above has no applic
          Where the statute which authorized the procurement
the policy and the payment of the premium Is unconstltutiona'
we are without power to raise an Implied contract to pay the
premium for the period the policy was In force; the Implied
contract would run afoul of the same constitutional prohlplt:
Edwards County v. Jennings, 89 Tex. 618 35 S.W. 1053 (1896)
Noel v. City of San Antonio, 33 S.W. 263 (Tex.Civ.App.1895,
error ref.).
          In City of Tyler v. Texas Employer's Insurance Assc
288 S.W. 409 (Tex.Comm.App.1926) the Insurance corporation
brought a suit to recover unpaid bremiums on a policy of work
compensation insurance Issued to the City of Tyler covering
certain employees of the city. The Court held that the Workn
Compensation Act did not apply to cities; that Section 52 of
Article III of the Texas Constitution denied to the Leglslatt
the power to include cities within the scope of the Act or ac


                            -2945-
Hon. Herbert Mlddleton, page 5 (C-607)


the payment of premiums for a policy of compensation Insurance.
The language from page 412 of that opinion Is conclusive upon
the question before us:
           "Viewed from another standpoint the Leg-
     islature would have no authority to include
     cities and towns In the act for the plan
     necessarily permits such cities and towns be-
     coming subscribers to grant public money or
     thing of value In violation of the section of
     the Constitution already quoted. The pur-
     pose of this wholesome provision is to pre-
     vent the gratuitous appropriation of public
     money or property. The purposes for which
   . public money may be expended are clearly
     defined by law, and a grant In aid of or to
     any Individual, assoclatlon, or corporation
     whatsoever Is not one of these purposes, but
     Is expressly forbidden. When the Workmen's
     CompensationLaw Is analyzed and fully un-
     derstood, It Is clear that to permit a munlcl-
     pal corporation to become a subscriber to the
     Insurance association therein provided authorizes
     It to grant public money by way of premiums
     for Insurance In aid of Its employes to whom
     It is under no legal llablllty to pay. As already
     pointed out, the act contemplates compensation
     In the absence of any legal llablllty other than
     the acceptance of the plan. Cities and towns
     have no power to appropriate the tax money of
     Its citizens to such a purpose. It Is at best
     a gratuity, a bonus to the employe. The city
     might as well pay his doctor's fee, his grocer's
     bill, or grant him a pension.


          "It may be conceded that those employes of
     a city engaged In industrial work of a proprietary
     nature are as much entitled to the compensation
     provided by the act as are the employes of strictly
     private corporations. This is not the question.
     The question Is, Has the Legislature power, In
     view of our constitutional provisions and
     limitations,to authorize cities and towns to
     make such insurance for their employes? We have,
     with much hesitancy but after due deliberation
     concluded that the Legislature has no such powei,
     and that, if It had attempted to exercise such

                            -2946-
Hon. Herbert Middleton, page 6 (c-607)


     power, Its act would have been void. The wldsom
     of the Constitution Is for the people. Expediency
     will not justify a violation of Its provisions."
          In our opinion, Taylor County may not pay the short-
term cancellation premium for the policy of Insurance procured
by the County Clerk. The policy insured against a llablllty
for which the county was not responsible; the premium would
purchase nothing for county purposes. Under such circumstances
the payment of the premium would be an unauthorized grant of
public money proscribed by Section 52 of Article III of the
Texas Constitution. See also Georgia Casualty Co. v. Lackey,
294 S.W. 276 (Tex.Clv.App. 1927, no writ history).

                     SUMMARY
          Section 52 of Article III of the Texas
     Constitution prohibits the payment of a short-
     term cancellation premium for a policy of
     insurance procured by the County Clerk of Taylor
     County pursuant to Section 4 of Article 1937,
     Vernon's Civil Statutes.
                           Very truly yours,
                           WAGGONER CARR
                           Attorney General




WGS:ml
APPROVED:
OPINION COMMITTEE
W. V. Geppert, Chairman
Paul Phy
Kerns Taylor
John Reeves
John Banks
Malcolm Quick
 APPROVED FOR THE ATTORNEY GENERAL
 By: T. B. Wright

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