Can a Texas county pay back a private person's legal bills from a lawsuit?

Plain-English summary

A Morris County attorney asked whether the county could reimburse private parties for attorneys' fees they spent in litigation. The facts: a corporate landowner sued the county to stop it from reopening an old county road that was the subject of a right-of-way dispute, and two other private landowners sued the corporation to get access to their land by the same road. The corporation won both lawsuits, and the two private landowners then asked the Morris County Commissioners Court to pay back their legal expenses. The Attorney General concluded that article III, section 52 of the Texas Constitution forbids it.

Article III, section 52 says the Legislature may not authorize a county to lend its credit or grant public money or anything of value to any individual, association, or corporation. The purpose is to prevent the gratuitous application of public funds to private use. A governing body decides in the first instance whether a public purpose justifies an expenditure, but the constitution still requires that the public receive consideration in exchange and exercise some control over the use of the funds.

The opinion accepted that counties have general authority over county roads and may employ counsel for road litigation, and that a county may use public funds to prosecute road litigation that protects private rights where the commissioners court finds it serves a public purpose. But it drew a sharp line on who hires the lawyer. A county may reimburse litigation expenses only when the litigation serves a public purpose and the governmental body actually employs the attorney. When the county employs the attorney, the county gets consideration (legal services) in return for the fees, and the county's contract with the attorney supplies the necessary control over the work regardless of how the suit comes out. That was not the situation here. The private landowners, not the county, hired the attorney; the attorney's services and the benefit of them ran to those private individuals, and the attorney was never subject to the county's control during the case. So even if the litigation served a public purpose, reimbursing the private landowners' fees would be an unconstitutional grant of public funds to private individuals, prohibited by article III, section 52. The opinion expressly did not address article VIII, section 3 or article XI, section 3, a court-ordered fee award to a prevailing party in a suit against the county, or fees awarded in a settlement.

Currency note

This opinion was issued in 1992. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. The statutes referenced here have been amended and recodified since 1992, so confirm the current constitutional and statutory provisions before relying on any rule described.

Background and statutory framework

Article III, section 52(a) provides that the Legislature shall have no power to authorize any county to lend its credit or to grant public money or a thing of value in aid of, or to, any individual, association, or corporation. The purpose of the provision is to prevent "the gratuitous application of funds to private use." Brazoria County v. Perry, 537 S.W.2d 89, 90 (Tex. Civ. App.—Houston [1st Dist.] 1976, no writ); see generally Willatt, Constitutional Restrictions On Use Of Public Money and Public Credit, 38 Tex. B.J. 413 (1975). Although it is for the governing body to determine in the first instance whether a public purpose justifies an expenditure, see Attorney General Opinion JM-824 (1987) at 3, the provision requires that the public receive consideration in exchange for its expenditure and exercise some control over the use of the funds. Attorney General Opinions JM-964 (1988) at 5; JM-768 (1987) at 4-5; Willatt, supra at 422.

Counties and their commissioners courts have general authority over county roads. See Tex. Const. art. V, § 18(b) (commissioners court to exercise jurisdiction over county business as provided by law); V.T.C.S. art. 2351(2), (5) (commissioners court to exercise general control over all roads in the county). A county is generally authorized to employ counsel in litigation pertaining to county roads. Cf. Burleson County v. Giesenschlag, 354 S.W.2d 418, 420 (Tex. Civ. App.—Houston 1962, no writ) (commissioners court authorized to employ an attorney to prosecute a condemnation suit); Galveston County v. Gresham, 220 S.W. 560, 562 (Tex. Civ. App.—Galveston 1920, writ ref'd) (county's authority to employ an attorney to assist in a sea wall project implied from its authority to construct the sea wall). And a county may use public funds to prosecute road litigation protecting private rights where the commissioners court determines the litigation serves a public purpose. Cf. Young v. City of Houston, 756 S.W.2d 813 (Tex. App.—Houston [1st Dist.] 1988, writ denied) (city may use public funds to prosecute violators of private deed restrictions where doing so serves the public purpose of regulating land use).

The dispositive distinction was who employed the attorney. The opinion concluded a county may not reimburse a private party for litigation expenses unless the litigation serves a public purpose and the governmental body actually employs the attorney. When the county employs the attorney, it receives consideration (legal services) in return for the fees, and its contract with the attorney supplies the requisite control regardless of the outcome. See Attorney General Opinions JM-824; JM-755 (1987); MW-373 (1981). Where, as here, a private party rather than the county employs the attorney, the consideration runs to the private individuals, not the county, and the attorney is not subject to the county's control during the suit. Under those circumstances, even if the litigation served a public purpose, reimbursing the private landowners' fees would be an unconstitutional grant of public funds to private individuals, prohibited by article III, section 52. The opinion noted, see Attorney General Opinion DM-107 (1992) at 4, that it was aware of no authority for a governmental entity to reimburse a public official or employee for legal expenses after the person has already incurred them.

Common questions

Can a county pay back a private party's legal fees from a lawsuit?
Not in the situation here. The opinion concluded article III, section 52 prohibits a county from reimbursing private landowners for attorneys' fees they incurred in a right-of-way action against another landowner, because that would be a gratuitous grant of public money to private individuals.

Does it matter that the road dispute might have served a public purpose?
Under the opinion, a public purpose alone was not enough. The constitution also requires consideration to the public and public control over the funds. Because the private landowners hired their own attorney, the county got neither, so reimbursement was barred even assuming a public purpose.

When can a county spend public money on road litigation?
The opinion recognized that a county may employ counsel and use public funds to prosecute road litigation that serves a public purpose. The key is that the county itself must employ the attorney, so it receives the legal services and controls the work through its contract.

What did the opinion not decide?
It expressly did not address article VIII, section 3 or article XI, section 3, a court-ordered award of attorneys' fees to a prevailing party in a suit against the county, or attorneys' fees awarded as part of a settlement.

Citations

• Tex. Const. art. III, § 52(a)
• Tex. Const. art. VIII, § 3
• Tex. Const. art. XI, § 3
• Tex. Const. art. V, § 18(b)
• V.T.C.S. art. 2351(2), (5)
• Brazoria County v. Perry, 537 S.W.2d 89 (Tex. Civ. App.—Houston [1st Dist.] 1976, no writ)
• Burleson County v. Giesenschlag, 354 S.W.2d 418 (Tex. Civ. App.—Houston 1962, no writ)
• Galveston County v. Gresham, 220 S.W. 560 (Tex. Civ. App.—Galveston 1920, writ ref'd)
• Young v. City of Houston, 756 S.W.2d 813 (Tex. App.—Houston [1st Dist.] 1988, writ denied)
• Willatt, Constitutional Restrictions On Use Of Public Money and Public Credit, 38 Tex. B.J. 413 (1975)
• Attorney General Opinion JM-755 (1987)
• Attorney General Opinion JM-768 (1987)
• Attorney General Opinion JM-824 (1987)
• Attorney General Opinion JM-964 (1988)
• Attorney General Opinion MW-373 (1981)
• Attorney General Opinion DM-107 (1992)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0133
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1992/dm0133.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

Office of the Attorney General
State of Texas

DAN MORALES
ATTORNEY GENERAL

June 29, 1992

Honorable Richard B. Townsend
County and District Attorney
Morris County Courthouse
500 Broadnax Street
Daingerfield, Texas 75638

Opinion No. DM-133

Re: Authority of the Morris County Commissioners Court to reimburse private landowners for attorneys' fees incurred in right-of-way action against another landowner (RQ-161)

Dear Mr. Townsend:

You ask whether Morris County (the "county") may reimburse private parties for attorneys' fees incurred in litigation. You describe the fact situation which gives rise to your question as follows: A corporate landowner sued the county to prevent the county from reopening an old county road which was the subject of a right-of-way dispute. Two other private landowners sued the corporation to gain access to their land via the same road. The corporation prevailed in both lawsuits, and now the two private landowners seek to have their legal expenses reimbursed by the Morris County Commissioners Court. You ask whether the Texas Constitution -- particularly article III, section 52; article VIII, section 3; or article XI, section 3 -- prohibits this use of public funds. We conclude that article III, section 52 of the Texas Constitution prohibits a county from reimbursing private litigants for their attorneys' fees in the circumstances you describe.

[Footnote: Because we conclude that the expenditure is prohibited under article III, section 52, we do not address whether it may also be prohibited under article VIII, section 3, or article XI, section 3. Nor do we address a court ordered award of attorneys' fees to the prevailing party in a suit against the county, or attorneys' fees awarded as part of a settlement in a suit against the county.]

Article III, section 52, provides in pertinent part:

  [T]he Legislature shall have no power to authorize any county . . . of the State to lend its credit or to grant public money or thing of value in aid of, or to any individual, association or corporation whatsoever . . . .

Tex. Const. art. III, § 52(a). The purpose of this provision of the Texas Constitution is to prevent "the gratuitous application of funds to private use." Brazoria County v. Perry, 537 S.W.2d 89, 90 (Tex. Civ. App.—Houston [1st Dist.] 1976, no writ). See generally Willatt, Constitutional Restrictions On Use Of Public Money and Public Credit, 38 Tex. B.J. 413 (1975). While it is in the province of the governing body to ascertain whether there exists a public purpose which justifies the expenditure of public funds, see Attorney General Opinion JM-824 (1987) at 3, this constitutional provision requires that the public receive consideration in exchange for its expenditure and that it exercise some control over the use of the funds. Attorney General Opinions JM-964 (1988) at 5; JM-768 (1987) at 4-5; Willatt, supra at 422.

Counties and their commissioners courts have general authority over county roads. See Tex. Const. art. V, § 18(b) (commissioners court to exercise jurisdiction over county business as provided by law); V.T.C.S. art. 2351(2), (5) (commissioners court to exercise general control over all roads in county). We have no doubt that a county is generally authorized to employ counsel to represent it in connection with litigation pertaining to county roads. Cf. Burleson County v. Giesenschlag, 354 S.W.2d 418, 420 (Tex. Civ. App.—Houston 1962, no writ) (commissioners court authorized to employ an attorney to prosecute condemnation suit); Galveston County v. Gresham, 220 S.W. 560, 562 (Tex. Civ. App.—Galveston 1920, writ ref'd) (county's authority to employ an attorney to assist in sea wall project necessarily implied from general authority to construct sea wall). Furthermore, we believe the county may use public funds to prosecute road litigation protecting private rights where the commissioners court determines that the litigation serves a public purpose. Cf. Young v. City of Houston, 756 S.W.2d 813 (Tex. App.—Houston [1st Dist.] 1988, writ denied) (city may use public funds to prosecute violators of private deed restrictions where doing so would serve public purpose of regulating land use).

We conclude that a county may not reimburse a private party for litigation expenses unless the litigation serves a public purpose and the governmental body actually employs the attorney. When a county employs an attorney, the county receives consideration, i.e., legal services, in return for attorneys' fees. In addition, the county's contract with the attorney supplies the requisite control regardless of the outcome of the suit. See, e.g., Attorney General Opinions JM-824, JM-755 (1987); MW-373 (1981). This is not the case, however, in circumstances such as you describe where a private party, rather than the county, actually employs the attorney. In the situation you describe, the attorney employed by the private landowners undoubtedly performed legal services in return for attorneys' fees, but that consideration went to the private individuals who employed the attorney, not to the county. Nor was the attorney subject to the control of the county during the progress of the lawsuit. Under these circumstances, even if the litigation served a public purpose, reimbursement of the private landowners' attorneys' fees would be an unconstitutional grant of public funds to private individuals, and is therefore prohibited under article III, section 52 of the Texas Constitution. Therefore, we conclude that a county is prohibited from reimbursing the private landowners for attorneys' fees in the situation you describe.

[Footnote: See also Attorney General Opinion DM-107 (1992) at 4 ("we are not aware of any other authority for the proposition that a governmental entity may reimburse a public official or employee [for legal expenses] after the person has incurred legal expenses") (citing Letter Opinion No. 90-93 (1990)) (emphasis in original).]

                               SUMMARY

      Article III, section 52 of the Texas Constitution prohibits the Morris County Commissioners Court from reimbursing private landowners for attorneys' fees they incurred in a right-of-way action against another landowner.

                                            DAN MORALES
                                            Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Deputy Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Mary R. Crouter
Assistant Attorney General