     OFFICE   OF THE AlTORNEY        GENERAL    OF TEXAS
                            AUSTIN




iionorabls   George E. Sheppard
Coznptroller    of Public Aooounts
Austin,    Texas
Dear Sir:
                              warrant   in




                                             eratlon to the
                                             ter of Hovembsr




                                      on Is avail-
                                     ler’s Depart-
                                      issus warrant

                        y of the knerioan     National    Bank


                        Senate Bill 179,     Chapter     440, Aots
                  s, reads as follower
Honorable      Gee. H. Sheppard,      page 2


               *TO pay the American Eatlonal         Eank,
         of Austin,   Texas, to rel!nburse sold bank
         for money ndvnnoed for the oonstruotlon
         of the Auditorlun    Building    at Iqricultural
         and Meohanloal Collage,      aaid building       hsv&ng
         been aut.horlzed   by tha Aoto of the Thirty-
         fourth Lo&lslature,    First    Called Session,
         1915, page 104, and said sum bei% the un-
         expended balance of said appropriation----$8,861.62*
               Seotion   5 of said’ Xot provides      in part      a8 fol-
lows :
                “It is spsolfically      provided herein that
         before any claim shall be raid frcm funds
         hereby appnpriated        the aam shall have the
         approval of the Stats Co.nptroller,           the State
         Auditor and Bfflclenop       Zxpert,    and the At-
         torney General.      ‘It la further     provided that
         any claim, involving      the refund of Gofranohlae
         tax shall also carry the aF;roval           of the
         Secretary    of State in addition       tom the other
         offio lals herein rimed.. *
               The State Coqtroller        has never approved the
pspnant of this claim.          No warrant     thersfore    has ever
been issued.       The preceding      administration      of the At-
torney Genaral~s       office first     wrote an opinion,         In
August, 1937, holdiw         the appropriation        to ‘pay the
claim of the h.BriCaA NstioAal EaAk to be UACOAStitU-
tional,     the effect of such opinion ncoassarlly              being
to deny the existence        of ConstitUtiO3al        authority      fn
the Attorney General,        tha Comptroller,        and the State
A~uditor and Pffiolenoy        Expert to approve the payment there-
        A ytnr later      by conference     opinion No. 3022, dated
$ust      .22, 1938, iddressed      to the Honorable Tom C. KIna:,
State Auditor, the preceding           admln:strntlon      of the At-
torney CanereVa        offioe held the appropriation            to be
constitutional.,      aAd overruled     the preceding      opinion
rendered by ~the a dzinlstration,          the effeot     of this opinion
being only to hold that the Constitution                of the State Of
Texas would not prevent         the, a.pproval of the clakn.           This
 opinion of the’Attorney’Genera1,            however, did not approve
  -he payment of the claim expresnly.
Honorab16    Gee.   H.   Sheppard,     page 3


               The State Auditor and Dfficlenoy              Sxpart refused
to approve th6 oleim,          end   CA  Dov%mb%r      8, 1938,   the her-
fcan D3tional        Bank, as relator,        filed Its petition       for
m3Adomus fn the 98th Dlstrlct              Cxrt of Travis County,
agr_inst Tom C. King, State Auditor and Efficiency                    Expert,
only,     aasking to have the cnurt compel Ton C. King, State
Auditor and Efficiency           vdpert,     to approve the clnim of the
Xm.%rican National        Ba;lk. On Deosmbnbar19, 1938, the case
1~3s heard and the court ordored mandamus to issue against
Tom C. icing, State l*udltor and '2fticiancy               ExpGrt, cozipelllng
him to approve the payment'of              such olaim of ths American
National      Bank.     Onthe so.718 day the Attorney General,              rep-
resenttip,      tha Stste Auditor,       filed with the clerk of the
cc,urt notlae       of appaal and request          for findings     of fact and
c0nc1uaions        of law.    On February 16, 1939, transcript              and
stata-tint      of facts vrere filed vrlth the Austin Court of
Civil Xppeals.          On June 20, 1939,        appell%e,    the rh5riCaA
X'ntioA31 Eank, fired it3 zzotlon to dismiss the appeal on
the 8rouAda "th3t A0 AOtiCa Of app%al iA Op%A OOUl% was
6ver    given. n The Court of Civil Appeals dismissed                   the appaal
OA July 12, 1939, for r6aBoAs stated                  in app%~le%*s SotioA,
snd motion of appellant           for rehszring        was ~subs%qu6Atly dis-
aisaed.       ft arpaars,     therefore,~     that the.judgmeAt       of the
District      Court granting      mandamus to oompel the Stat6 :.udi-
tor to approve the claim of the Aasrioan                  Xatlonal    Bank has
beooae.final.
            The question       to be determined,    therefore,      is the
effect   of this final      jadgment upon the Attorney. GeAeral,
th% State Comptroller,         and the State of~Teras.         IA other
t:ords, is the jus'gmment of ths Dlstrlot         Court of Travis
County, rendered in the suit agaiast           To?n C. King,     State
Audltor,   detarxining      the question   of the COnStitutiOAality
of-the claim of the Amerlcan.Natlonal            Bank, res adjudicata
Or such&sue      as'against      the State of Texas, the Attorney
General,   and the State COmptrOll%r.
              This question,      wa   are   oonvInoed#    must be
answered     in the negative.
          nThe key which unlocks the State Treasury       is an
set of the L6glslatura'dlr%ot~Ag      the thing to bs done
which is denandad."       Treasurer yw, Vygall,  46 Tar. at
pnee 465.   That tvhich the Stat6 has set up as a condition
pr%c%deAt +.o th% payment of a olaim.aeaiAst       it may not be
iicnorable   Geo. B. Sheppard,       pa~,e 4


abrogated    by the subotltutlon       of a new and dlfrerent
ooxultlon    precedant.
              Hepa the Leglsla+re          has seen rlt to provide
that the clain of the i%nerioan National              Bank nay not br
paid until      three separate       and dlstinot    officers    at the
State eovarment          shall hnvs approved it.         The approval
or one or these orrlcers           Is not *the key Xhlch unlocka
the State Treasury.*           The jud@ent      of t,F,e cburt ag:~.lnst
Ton C. Xl% la not binding on the Comptroller                   or the
Attorney General,         upon the fuod.acisntal     principle     of law
that a judgmnt         la not binding upon one who la notaa
prty    ta the ?rooaedlng.           Texas Juris~rutiecce,      Vol.
26, pares 241-242.           The jucig:aezt is sot blcdl3g, upon
tile State,     because the Stste has not OonsentsS that it
shall   be represented        in the mtter       of approvlna this
claim by To% C. Elng alone, but has stipulated                  that
the spproval thereof          shall be by the three G.ffiCial8
maad,     to-nit,    the State Aud.&tor, the Attorney General,
*rid t;?e Cozptroller.~         The duty of approving or dls-
approvlllp; such claim Pested upon all three offioara,
rat upon on0 0r the&            Gz16re psrforsanco      of a duty is
sought to be coapelled          by cL9ndem8, all persons charged
?'lth the psrforzmnce         Or that    duty mat be 33a8 parties.
Gaal v. Townsend, 77 Tel. 464, 14 S. W. 365.
           All parties    charged with the Uutg of a?prov-
iw or disapproving     the claim of the American National
Sank F;ere not made parties       to the suit in the Dlstriot
Court or Travis County, but only Toa C. Elng, State
 Auditor, was a party to such suit,          and judgment therein
MS rendered    odly against     hlzz.     It is therefore    apparent
that the ju@mnt      of the court rendered          In that Oase
1s not detar~inntlvs    0r.the      issues   involved as against,
the State Co%ptrollar,     the'irttcrney       General,   or the
State or Texas,
           .Havlng determined      that the judgnent rendered
by the District      Court of Travis    County is not binding
upon the State of Texas, or the Comptroller            or the At-
torney General, we pass to the question           of whether your
depnrtzent    ia legally   authorized    to issue a warrant       in
psyaent of this claim.        This question    lnvolves   daters-
lning Prhether the Comptroller        and the Attorney General
nay oonstltutlonallp      approve the payment of this olaln,
Honorable     Geo. H. Sheppard,        page 5


              The racts under which the alleged               olala   of
t:ie Amrican     National Bank arose are these:
              Chapter 32, Aots Gf the First              Called Baasion
of the 34th Lsglalaturs           of Texas:, In 1915, appropriated,
for ths wrIncsl biennium baglnn!.ng Septsmber 1, 1915,                                J
and enElng August 31, 1917,” $lC~O,OOO.CO**or so mob
thersGf as my ba nsoeasary”              for the construction           of
an auditorium       at A. & ?*l. Collsg0 (page 1Of.). Cn Z~ovesbsr
29, 1916,. ths Board of Dirsotorr:             of A. k V. College enter-
;d into 6 contract         with Ledbettor       .? Creethouse       of Austin,
Texas, for the srsction           of such auditorium         at a CGntraCt
price or $91.138.38.           On April it,1917, the tinltea States
dsolnred     war on Gemany.         In the spring or 1918, Ledbetter
E; Cresthouse      Cefaultecl In the pc~rfomance of their contract,
and the sureties        on their. bond --‘&used to proceed vlth the
construction       or the building,        c~.alalng that the war had so
Inoraassd      costs 0: labor and xa’;erlals            as to make it iul-
possible     to csnpl%ts the contract            for oonstruction        or ths
building     at the contract       price,    withaut     Suffering      a 106.0,
and thet     this fact relieved        the!.1 fro2 perromance.             T&ire-
arter,    several     embers    or the Board or hirectors             or A. &
X. Colle.ne and a repreoentotlve              of the Govsrnor of Texas
?rsvailed      upon Major LlttlaTleld,           President     Gf the A%r-
Ican Xstlonal       Sank, to advmce nufflcisnt              moneys to enable
Ledbatter      & G.resthouse to ccxpljte          the building       without
suffering      a loss, rspresentlng         20 Xajor     utthfi0ia         t%t
there wes an unexpsnded balance               of the $lOO,COO.CO agpropria-
tion nhlch they could not .sxpend vlthout                  sonsent of the
Legislature,       but that they zould reco.mend. that the
Legislature      ralinburse    the bank .Por the nonsy advanced.               Such
nonap was advanced by the bank in the sm of approxtiataly
 PZ3,OOOiCO. by nhich the buildf:lg              vma CO.?l?lSted by
Lsdbsttar      & Greathouse      In accordance       with the plans end
specIfIcatIona        axbodied In the original            contract.
            The lnabllltg      of ths LsgIslaturs,      under restraint
or the oonet.ltutIon,~     to appropriate    anything     In payment of
this account over and above $8,d61.62,            Is conceded; but It
la COntsndSd t%at at the time this agrsexient was hnd with
?%jor Littlefield,      there was an unexbendsd balance in the
SlO0,OC.O.GO opproprlat Ion of $8,861.82,           and that, by VatI-
ricetIonW   by the Legislature       of the. agreemnt      cads with
Xajor Littletleld,      wlthla   the .ltxIta  of the E!SOMt pr~e-
sorlbsd by ths Wprs-srietlng         law?, to-wit.     ths 1913 “o-
Honorable      Gao.   H.   Sheppard.      paxa 6


proprlatlon,       tha payment or the clalm to thk extent                     0r
$8.861.62      escapes the oondematlon    or the constitution,
           By the 45th kelslature,     thera.wae  appropriated
this aurn of $8,861.62, payment of vhioh was authorfzed        to
be made only upon the oondition    hereinabove   noted.

                It will be obaervad that Article                 VIII; Section
6, or our constitution             limits     n$propristions       to tcms not
exceeding       two ywrs.        It will li!iewlse         be observad thet
the $100,000.00         appropriation         was zeda available         for ex-
penditure       for the fiscal        biennium "endjx           Aquust 31,
1917."       The LeGislatura         did not 'Pest the Board of kecents
with a continuing         authoritp~to          contract     for ex;endltura          of
the ~lGO,OOO.CO, but only alth authority                      to contract      with
reference       thereto   duriq       the period for which the approprla.
tlon was ziade.         Ooncading         ror the purpoees or this opinion,
t!b?t on Aufqlst 31, 1917 , $C,861.62 or the origl.nal                       ammo-
prlatloti      rmained    unancmbered,           neverthaless,       by vi&a         of
the provisions         of the constitution            end of the appropriation
hill    Itself,     the unoblfGated          0," unetmunberad      portion     or the
~100,C00.00 appropriation               lapsed,     and the authority         to con-
tract with rafe/enoa           to It cululnatad           on Septe?zber 1, 1917.
nt the tim the contract               or ny;reemnt        with rei”erence      to
such unexpended balance was had, tho unexpended portion
cf the appropriation           was no lor,ger availabla,:'ond             'the euth-
o,-ltp to contract        with referenca           to It had expired.           It is
clear,     tkerefare,     that the aRroement upon which the claim
for $E,861.62 we8 founded was not authorized                       to he .znds
upon an appropriation            in axlstence         at the.tFae     of the incur-
ring    or the slain;       that the authority            or the orricers         in-
volvsd to bind the state.by                 contracts     for the construction
of the auditorium         had expired         with the appropriation           which
had oonrerred At.           It ie appamnt,            therefore,     thet tha
qreexent        was an attoxpt        on the part of suoh otfiaiala
to create a debt against              the State,       without authority
conferred       by pm-existing          law.
             AS a nattsr or faot,   ht thctime       this agreamnl
v.3~ aads, there was In existence      and In full force end ar-
.feot e law passed ~by the Le&slaturs,       to-wit,     Seuata'Blll
XO.   29, enaoted by the First    Called Session or the 33rd
Legisletare;    approved Aup,uat 19, 1913, tha provla1ouaot
which nerr as.rollowsr
Honorable     Geo. H. Sheppard,        page 7


               55eotlon 1. Th?t it shall              hereafter
       be unlawful for any regent,               or ragonto,
       alrector     or directors,        officer    or orfleers,
       member or members, or any educational                  or
       eleemospnery       Institution       oi the state      or
       Texas, to contract          or pro-A@6 for ths srec-
       Mon. or repair        of any building,        or other
       1:qprovoment or the purchese' or equipment
       or supplies      of any kind whetsoever            ror amp
       such icstltutlo~,          not authorizad       by specirlio
       lcglalatlvo      enactment,       or by nrittsn       dlraa-
       tlon of the Governor .of this State,                aotlng
       under    and consistent        with the authority         ot
       existing     laws, or to contract           or cicate     any
       indebtednose      or doflclenog-        In the name or.
       or againet      the Stote,      not s~eclflcnlly
       authorlzod     by legislative         onact&ent.      . . .
               Yhsctlon 2. That any end all oontrs.ats,
       debta or derlolencias       creatsd contrary  to
       the provlslons     or this Act ,shall be wholly
       and totallyvoid        and shall not bo onforoeable
       against    the State."
             Section 3 or said Act provided        ti:et for a vlola-
tion or ita    provisions   tha orfander     should be: removed
from orrfce,     andshould,   .ln _addition,
                                     __        be- punished by
lziprlsomant     in tho aounty jail for not loss than 10
days nor more than six months.
            Section    L9, Artlch     ISI, of the cocstitution
,“rovldos that “no debts sh:all’bd        created    by or on behalr
oi the State;     except to supply-assual        doficienaios     of
rsvenuo,  repel Invasion,       suppress   insurrection,      datead
the Steta ~ln time ot war, or pay existing             debts;  . . .
 . . .”
             Artiale    III,   Seotion 14, of the constitution
provides    that “The Loglelature       . . . shall not grant
extra coqmnsation         to eny . . lpublic     contractors,
after    . . . contrsat      entered Into, ror th6 ~arformanco
or the saao; nor grant ;. by egprcIrlation         or, otherwise,
any amount .of’ money ;~.. . to arq’ individual,         on a
claim, real or pretsndod,          when the aaae shall not $8~6
been provided far by pro-6xist+tg          law; . . . .*
             .~Tho validity      and appllcabillty        of the proposl-
tion   stated    below with      rotoroncr   to the      aroatlon and
Zonorablr       Geo. ‘H. Sheppard,            pagr      8


attaroptad       payment        of this     claim      ore   4vids~t.s
                .l.     Creation      of    debt.
           (a)   Tha Leglslaturs  nay not create or author-
Ixe the craatlon   of a debt against  the State,   szcspt for
purposes which do not include    the situation   befor   us.
            (b) The agreesent      with the American National
Bank was an uEauthorlzed     atteIipt  to create   a debt or
llablllty   aSainbt th4 State,     am3 was void iron its in-
caption both by virtus    oi the constitutional       provlslm
am? bp virtue    of the exprees provlalons      of the statutce
above quoted.
                 (0)     Ratification    nay   not create a liobllit7
against   the      Stato In the taoe of a oonstItutlons1              provision
denying the         llablllty      and prohIbitInS    the Lecialatara      r;roa
racognlxing        such claI.ze.
                 2.     Extra     comanaation           to public        contractor.
                 (a)
                 ~The Legislature  is without pov4r to allow
extra      cc.?l-,ensatlon
                      to a pub110 contraotor   for ooapleting
the ;?erfornanos   of a contraot  entored Into bstveen the
contractor   and the State.
                (b) Vhat the Legislature                     is without       power to do
direct17       my not be aocompllahetl                  by   indirection.
             The purpose and etrect     OS the agreenant       seas be-
tw6en the state     officers  and the Amrican       National    Bank
were the allov~4’;ence of additional    oospensatlon      to ,Ledbettsr
et Greathousa   to induce thezu to cofnp14ta a Contrect          already
entered Into and partly      perroraed,   according     to Its     terms
and SpecificatlonS.
                 3.     fa.mrmant of claim          not authorized           by   pre-
6XiStillP.     law.

            (a)     Tha constitution    denlas th4 existenc4    of
porter in the Leeislaturo        to pay “by appropriation   .or
othervise*      al “real or pretended”    o1aI.m: “not . . .
provIOed       for     by   ~pre-exfstin&       law.    n

               .(b)         The Leglslatur4     aay not pa7 a claim unless
there      erlst4d      at th4 tin4       the taots upon which the claim
.




    Honorable      Geo. 8. Sheppard,     pa,:6 9


    15 roundod occurred a law reco,~nliinp     that such facts
    Impose a valid and subsisting   obllpatlon     upon the State.
                 (c) All persons CoalInS tilth pub110 officers
    are charged with ti&lad$:e       of the llnltntlons   upon their
    suthority,    and clalas  arIsInS upon contracts     or agresxenta
    ylhlch public OfrICers lnck authority        to mske iaposa no
    ohlI,yetIon   upon the State whIoh may be recognized       and
    paid by the Leglalaturo.
                   (d) The.cla13     of the Amrlcan      National   Bank
    la founded upon, a contract        or ograeaent    md4    by public
    cfflcers     without authority,     thotc belrq, no law ves~lng
    such officers      v:Ith authority    to borrow Toney In behalf
    of the state,      and their authority       to contrsct   vi th rof-
    e-ence to the ~100,000.00 sparo;>rIation            havim expired
    at the t&m of the agreemnt           w:‘.th the AnerIcan ?r’atIonal
    Bank, and the str?tutes       in eriscence     at that time having
    speciffcally      denied such autho-nlty and provided that
    such contract      should be utterly      void and uneforoeable
    against     the State.
                 The .foregoInq     proRosltIons    are   axply   eupported
    by tba   Iollowing    oases:
                   Stste v. bllson,        71 Ter. 291, 9 S. W. 155
                   CorsIoana Cotton Xl110 v. Sheppard,           71 S.
                       7;‘;‘
                           (2d)
                            .     247
                   hosti::    Batlonai Bank v. Sheppard,      71 S.
                       P./2d) 2L2
                   Zt. ~Corth Cavalry Club v. Sheppard,          83
                       5. Vi. (2d) 660
                   State v. Ferlsteln.        79 S. W. (26) ll.3
                 -XIchols      v. State,    32‘5. V?, 452 -     .-
                   State v. Ealdeaan,        153 S. S. 1020
                   Conference Opinion bl C. Ip. Taylor,
                         approved by C. ?d. Cureton,      Attorney
                         General,     CpInIon Rook 52, paEe 20
                   Boo4 v, United Stotea,         218 U. S. 320,
                          54 L. Ed. 1q55
                I Gordon v. State,         233 N. T. 1, 134 H. 6.
                         698. 21 A. L. A. 562
                   ?Aulz&~.~ &tual~~ens?It          Life 1~s. Co.
                          (Cola. ) 33 L. R. A. 827
                 Ths following     language quoted iron portIona    of
    tho opInIon In the case of Gordon v. State,         cited  su;?ra,
    Is particularly     applicable     to the fact8 of thlo case:
Eonorable    Geo. EL Sheppard,          pa.xa 10


              “The contract        of Nov3nber 10, 1915,
     ‘betweao claimant and the %ate, ban executed
      after     clalsant,      In co2petitlon         rlth    othar
      contractors,        had subsittai         a proposal       for
      a psrforaanoe         of the acirk therein           spcoiriad
      to be perfomad           ana the 19bor and mtarlal
      necessary       to complete the same.               Cla imnt
      88s a oontractor,           end raxiliar        with the
      nature of the work to be grforxed,                      the cost
      of labor end matarials              nacesanry       to ccaplate
      the specified         work, end tie. tine viithln u:hich
      the sme 00uia be completed.                    Enga~ea in a
      hszordous       business,       claimmt      was chargaabla
      with kr-,owladga of the la&31 obW”:tion                      Fn-
      posed upon a psrty to a csntraot                    to perform
      his covansnts,          and llsbilltg        to respond in
      daaoges In the event of nmpcrforaance,                         and
      that a like obliqtion                rest&id upon the state.
      Ye may also attribute              to claimant,        as a busi-
      ness nan and oontmotor,                 knovrladge of the
      increasing        abnormal cant? itlons          existing     at
      tine time of the execution               of the oontroct.
      The powers of Europe had for some Use prior
      to Novazabbor 10, 1915, baea and were than en-
      gxgad in war.           Some five aonths previously
      t!:a qyressor         bed ruthlessly          caused the
      death of American citizens                and helpless
      ohilfiran upon the high sea, and the fact
      was apparent         that the United States oould
      cot, in the interest             of humanity md as a
      massure of sali-protection,                 10% delay
      p?rtJoipatlon          in the Ilar in ala of the forces
      opposad to the aglrressor.                A oontinuanca         of
       the r;ar, and partioulnrly              the entry of this
       country into the conflict,                would neoasoarllp
      result      Ln scarcity      of labor,        incraased      cost
       of the sane, snd Increased                cost or mtarisl,
      with continued          business       depression.       Confrongad
      Rith thct condition            and outlook,         claixsnt      pro-
      posed to undertake            the mrk under the contract.
      To say that he did not appreciate                     the risk, .and
       that his proposal          to perform the work was
      not made in oonts.mplatlon               of the abnormal
       conditions       then’ extant end dan&er of on in-
       oraasa of the came, vould be a serious                      ra-
       flectlon      upon his sagaoitp           as a business
      man. Tie unit prices               to be paid by the
       state for labor and material                 ware tlxed by
       olaimant in his propoeal.                 As a contractor
.




    Honorable   Gao. H. Sheppard,       pace   11


         he was aware of the prevafling            cost of labor
         ana ssterisls,       and ms quUflad         to antlolpate
         tha conditions       likaly    to nrim during the tam
         of tha contract.         At lesst,    he undertook and
         was ~1111~’ to Co so, and to &ve a bond to
         secure perf-ormnca         on his port.     Baving entered
         into the contract,         olaisont   becasa legally
         and equitcblg      bound to discharge       the obllqatlon
         ossu~~ad bg htim, however onerous the burden.
         Zorat v. L. Vcgalstein          & Co. 188 App. Mr.
         605, 611, 177 N. Y. Supp. 102; Colubus
         R. Fo:::er ?: Light Co. v. Columbus, 249 U.
         7. 399, 63 L. Ea. 669, 6 A. L. x. 1618,
         P. U. R. 19193, 239, 39 Sup. Ct. Rep. 349.
         lallura    or refuse1      on the Part of the olalm-
         snt to 2arforn       the co&tract muld vast fin
         tile stste     a cause of action for dmages
         against    hln, and to such actlo.? a defense
         that by raeson of wr conclitlons            the cost
         of 1abor”and rJatarials         had increased,    rendar-
         lng the controot        a loss to hia, would be
         unavailia’.

                n.  . . . . . .Fqulty       and justice     do not
         require    the state    tc rehburs6       a contrsotor
         for the increased       expense incurred        by h.i?x
          in the parformino~       of a contract      dn’a in no
         aaaaura    to the act of th6 ststa.            The c lalaant
         esswed     the risk Incident       to the pcrfor.smncs
         of his contract.        Esa the cost of labor and
         .nltarials    decreased    rethar    than Increased,
         the state;      under the oontraot,       I7oula still     be
         obll~sted.    to pay the unit prices         it covannnted
         to PsY, and equity and jur,tlca would turn a
         deaf ear to a suggestion          by the state that
         the expense to claimant hfid bean naterially
         reduced,    his anticipated       Profits    thereby
         lcrgely    lnoreas6b,     and therefore      a aoral
         obliEation      axisted  upon his port to reduce
         the cost to tho state:
                “The state    did not undertska  to indsanify
         alslmnt    against    loss upon his aontraot.    On
         the contrary,:     It raquLrad him to p,ivea band for
         a strict   oozapllsnoa on his part with the tarme
Honorable   Cso. ii. Sheppard,     3er.s 12


     of the snme. “er conditions              and the increased
     cost of labor &I msterials              or soarclty     of
     labor Rare not praclpltstad             by the state or
     due to any act upon its part.              So far aa
     the record diecloses,          the state     rerfoned
     every obllCatlon       rast:ng     upon it undar the
     contrsot.     Tie   contmct       bc;tvaen the cleFnant
     and L?e state VW purely s buslnoss                 tronsac-
     tlon skin to contracts          between indlvl@uals.
     Undoubtcdlp claimant .antlaipsted              a yrctit
     would raxlt      from his conlxact.            If dissp-
     qointad and a loss rssultod,             ha assumed ths
     risk of such losa and to b,t..:r the sarra.               A
     contribution     to hi-, and okar         contrrctors
     similarly    situvtad     by the taxpayers         of the
     state unaar the State of 1919, or In what-
     ever form fraxad, would operate aa a dispan-
     sat&On of charity.
            1)
             .   .   l   .



              The. oo.mmlssion c:au<ad in 1872 rqorted
      to the legislature      certain proposed constitu-
      tfonsl    anandments,   whioh, after    due action
      thereon on tha pert of tha laglslntura,          ware
      ratified    ~by tha ?aopla at a general     alaotlon
      in 1871, emI becmk affeotiue         Januerg 1,
      1875.‘~
             wGna of the amen?man:s adopted under 6
      different    numbarlng %a6 8 28 of artld e 3
      as it exists      today, and reads as follows:
       ‘Tha leglslsfure      ahall not, nor shall tha
      oomon     council of sny city, ‘nor any board
      of supervisors,       grant imy extra oc3penmation
      t0 my publ.:.c officer,      servant, avant, or
      oontraotor.’
             aBy the .ndoptlon of ‘that provision
       of the Constitution,         the~lep;ialetura    ws
      ,$haraaftar     inhibited     from apprOpriotiW$     money
       bcsad upon gratitude         and charity,     so far ss
       its  officers,     aorvants,     qganta, and oodmO-
       tore were concerned.
Bonorable    Ceo. 8. Sheppard,        pa?6 13


              "In alecussing     the e-Sect of the sea-
      tlon    of the Constitution        .;uoted, amongst
      others,     Judge STartin, arir;lng       for this court
      in Ste:mmlk v. Xe:: York, 179 X. Y. L73, &83,
      72 M. 3:. 58L, said:       '3inco those a.mendsents
      to the Constlbtion,          their    effect    has often
      been the eubject       of judIcia1       construotion      by
      this and other courta          in t,h6 at?te.       Although
      we are not unmindful of the aecislons                ot
      this court anterior        to thair      adoption,     and
      reqlize     that .the broad doctrine         was then
      heId that the lagislature            VI~'IQS
                                                not confined
      in its appropriation         of public money, or of
      suns to be raised by taxation             in favor of
       irdividuale,     to caeas \?here a legal demnd
       existed,     and that It could thus rscopnlza
      claims toundea upon equity ena juntlca,
      Yet, since the amendments, that rule has
      been chan(r,ed, and they have eliminated               ell
       considarations      of $ratituda       and charity     a8
      grounds for th6 apprOpriatiOn             of public
      money, exaept for the aid and support Of
       th6 poor, '
             The construction       thus plcced upon the
      section    OS the Constitution       has not been ds-
      parted from or modified.          as Legislaturs,
      thus prohibited      from recogn~lzing      clakas
      loundea on gratitude        and charity,     tras poxrer-
      less ta indlrectly.provide          B mtms of determ-
      inhg such claims,        provide for t!!c entry of
      judgment thereon against         the state,     ond to
      subsequently     appropriate     moneys to pay thr
      judginent.
             "The state of 1919 in Effect and eub-
       staaoe provides      for the payment of ccmpensa-
      tion to oontraotore        over and above that fixed
      by contract     r!hen the services      were rendered,
      and thersfore      'a &rant of extra compensation
       within the prohibition         of the Constitution.
       The fact that the COkrt of Claim3 v"as author-
       ized to hesr and aetcrmins          the claim does not
       render the stetut6       valid.    lnyinent of judg-
       ments renaaraa      by that court is provided for
       by cpprorriatlor.      of th6 funds of tha stats,
       and s.judgment      In favor of clalmant      In this
      'case, for inaraased cost of labor and material
        in excess of the amount specified          to bs paid
                                                                              ,   ,




Bonorhble     Geo. H. Sheppard,        P6F6 14


       in tha Cohtract,       wouldclearly         fall   within
       the terz-6 ‘eztre     oonpensation.*
              The followln~    quotation        is taken     from th6 ca86
of Nichols     v. State,   cited supre:
               W~titifiaetlon     or lzplied      liablllty
       will not extend to acts that ere exprens-
       lp prohibitsd        by law:, so long a6 the law
       is alive t&t prohlblts            the act.       !?iechard
              Karr6n Co       31 Iona 340; Eradg v.
       %yor,      et ce&a,       20 11. ‘9. 312. You can-
       not indirectly,        by rotlflcatlon,         araqte
       a liability       against ,the st.lte,       when th6
       cmsttitution       denies the li~billty,            and
       prohibits      th6~ le&iSlatL-6      fro3 Giving any
       vitality     to such a plan.         PO perrnlt
       liability      to b6 created      unler suoh
       circuxstonces        would be to .aulllfy         the
       constitution,        and to authorize        the ao-
       cozplishment'in        an indirect      way of the
       tiling thot is expressly          pr,>hlbited.n
             For the reasons stste,l,      we are constrained     to
hold   that the Comptroller      ar.d tie Attorney General are
without constitutional      authcritj     to approve the Pnynsnt
of t:.is claim and that, your depurttent         is not leeally
.?uthorizea,   und6r the constitution,        to issue a warrant
In payzent thereof.~     Confereuce opinion Xo. 3022, written
by the preceding     admlnistrstion      of the kttornay    General’s
Capsrtaent    of the State of Texas, addressed         to the Honorable
Tom c. King, Stat6 Auaitor,, .+us.:in, Texas, unaer ante of
August 22, 1938, and found         in Me reports     and opinion8 of
the httornay    General of Texas for the years 1936-1938,
inclusive,    on page 171,    Is hereby .expressly     overruled.
                Since the appropriation      providing  for tha payment
or this      claim is condenned by the constitution,         and thers-
iOr6   void,      it follor?s that no’ a;:propriatlon    is available
for the payment of th6 Clab Of th6 AnariCan National                  Bank,
for;clesrly,         an’appropriation   Ls not ~to be considered       aa
availabl6       in law unless that eD~n?oprietion      Is validly     =d6.
