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[Decision Concerning Subcontractor Claim Under UMTA Cooperative Agreement]

B-230909 Published: Jun 12, 1989. Publicly Released: Jun 12, 1989.
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Highlights

The Urban Mass Transportation Administration (UMTA) requested a decision regarding its authority to directly pay a subcontractor's claim under a cooperative agreement to locate disadvantaged businesses. UMTA advised that: (1) the firm which held the cooperative agreement subcontracted with the claimant to provide some of the services; (2) the subcontractor submitted the claim directly to UMTA after the firm did not pay for its services; (3) it had funds to pay the claimant for the services, since it terminated the cooperative agreement before it expended all of the obligated funds; and (4) it would not make further payments to the prime contractor, since the prime contractor lacked financial accountability. GAO held that there was no implied contract or privity of contract between UMTA and the subcontractor. Accordingly, the claim was denied.

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Claims settlementCompensation claimsContract terminationContractor paymentsCooperative agreementsGovernment liability (legal)Service contractsSubcontractsUnobligated budget balancesMass transitGovernment accountability and performanceWarrantiesSubcontractingFinancial assistanceIntellectual property rightsDisadvantaged businessSubcontractorsGovernment contractsFinancial records