A-26355, MARCH 18, 1929, 8 COMP. GEN. 495

A-26355: Mar 18, 1929

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

PAYMENT FOR GASOLINE PURCHASED IN THE OPEN MARKET AT A PRICE IN EXCESS OF THE EXISTING CONTRACT PRICE IS NOT AUTHORIZED. THE PURCHASE WAS MADE IN THE OPEN MARKET WITHOUT ADVERTISING. AT THE TIME OF THE PURCHASE THERE WAS IN EXISTENCE NAVY CONTRACT NO. 8426 WITH THE STANDARD OIL CO. WHEREIN PROVISION WAS MADE FOR THE PURCHASE OF GASOLINE BY THE UNITED STATES COAST GUARD AT WEST PALM BEACH. THE SETTLEMENT WAS ACCORDINGLY MADE UPON THE BASIS OF THE EXISTING CONTRACT PRICE AND THE DIFFERENCE OF $15.82 WAS DISALLOWED FOR THE REASON THAT THERE WAS NO AUTHORITY IN THE PURCHASING OFFICER TO OBLIGATE THE GOVERNMENT FOR ANY AMOUNT IN EXCESS OF THE CONTRACT PRICE. 1929: * * * REFERENCE IS MADE IN YOUR CORRESPONDENCE OF FEBRUARY 9TH WHEREIN YOU ADVISE THAT WE MUST ACCEPT 14 CENTS PER GALLON FOR THE GASOLINE IN QUESTION BECAUSE OF THE FACT THAT THE U.S.

A-26355, MARCH 18, 1929, 8 COMP. GEN. 495

OPEN-MARKET PURCHASES - GASOLINE - COAST GUARD WHERE THE NAVY DEPARTMENT IN CONTRACTING FOR GASOLINE INCLUDED THE NEEDS OF THE COAST GUARD ALL PURCHASES BY THE LATTER SERVICE SHOULD BE MADE IN ACCORDANCE THEREWITH, AND PAYMENT FOR GASOLINE PURCHASED IN THE OPEN MARKET AT A PRICE IN EXCESS OF THE EXISTING CONTRACT PRICE IS NOT AUTHORIZED, ANY PAYMENT THEREFORE BEING LIMITED TO THE CONTRACT PRICE.

DECISION BY COMPTROLLER GENERAL MCCARL, MARCH 18, 1929:

THE GULF REFINING COMPANY REQUESTED FEBRUARY 19, 1929, REVIEW OF SETTLEMENT 0197594-T, DATED FEBRUARY 9, 1929, DISALLOWING $15.82 OF ITS CLAIM FOR GASOLINE FURNISHED UNITED STATES COAST GUARD VESSEL 117, AUGUST 4, 1928, AT WEST PALM BEACH, FLA.

THE CLAIMANT COMPANY DELIVERED TO THE COAST GUARD BOAT IN QUESTION 791 GALLONS OF GASOLINE UPON REQUEST OF THE OFFICER IN CHARGE, FOR WHICH IT CLAIMED PAYMENT AT 16 CENTS PER GALLON. THE PURCHASE WAS MADE IN THE OPEN MARKET WITHOUT ADVERTISING. AT THE TIME OF THE PURCHASE THERE WAS IN EXISTENCE NAVY CONTRACT NO. 8426 WITH THE STANDARD OIL CO., WHEREIN PROVISION WAS MADE FOR THE PURCHASE OF GASOLINE BY THE UNITED STATES COAST GUARD AT WEST PALM BEACH, FLA., AT 14 CENTS PER GALLON. THE SETTLEMENT WAS ACCORDINGLY MADE UPON THE BASIS OF THE EXISTING CONTRACT PRICE AND THE DIFFERENCE OF $15.82 WAS DISALLOWED FOR THE REASON THAT THERE WAS NO AUTHORITY IN THE PURCHASING OFFICER TO OBLIGATE THE GOVERNMENT FOR ANY AMOUNT IN EXCESS OF THE CONTRACT PRICE.

IN SUPPORT OF ITS REQUEST FOR REVIEW THE CLAIMANT STATES, IN ITS LETTER OF FEBRUARY 19, 1929:

* * * REFERENCE IS MADE IN YOUR CORRESPONDENCE OF FEBRUARY 9TH WHEREIN YOU ADVISE THAT WE MUST ACCEPT 14 CENTS PER GALLON FOR THE GASOLINE IN QUESTION BECAUSE OF THE FACT THAT THE U.S. GOVERNMENT HAS A CONTRACT WITH THE STANDARD OIL COMPANY FOR A LIGHT PRODUCT AT THIS PRICE.

THE DELIVERY IN QUESTION WAS MADE ON THE OPEN MARKET AT WEST PALM BEACH, FLA., AND WAS NOT UNDER CONTRACT WITH THIS COMPANY IN ANY RESPECT. THE PRICE SHOWN ON THE INVOICES IN QUESTION, E., A NET OF 16 CENTS, WHICH DOES NOT INCLUDE THE 5 CENT STATE GASOLINE TAX, WAS THE BEST PRICE ON GASOLINE THAT THIS COMPANY HAD IN EFFECT AS OF THE DATE MENTIONED FOR ANYONE UNDER ANY CONDITIONS, REGARDLESS OF ANY CONTRACT, AND WE ARE, THEREFORE, FORCED TO DECLINE SETTLEMENT OF THIS CLAIM IN THE AMOUNT OF $110.74, AS EVIDENCED BY THE ATTACHED CHECK.

THESE DELIVERIES WERE MADE TO A DULY AUTHORIZED AGENT OF THE U.S. GOVERNMENT. THEY WERE MADE IN PROPER FORM. CORRECT BILLING HAS BEEN SUBMITTED COVERING DELIVERIES IN QUESTION AND THE SAME HAS BEEN PROPERLY ATTESTED. THE PRICE CHARGED FOR THE DELIVERIES IS NOT IN EXCESS OF ANY PRICE THAT COULD HAVE BEEN OBTAINED BY ANY ONE COMPANY, MUNICIPALITY, STATE, OR FEDERAL GOVERNMENT AS TO THE DATE IN QUESTION AT WEST PALM BEACH, FLA., FROM THIS COMPANY.

THIS CLAIM SHOULD, THEREFORE, BE PLACED IN LINE FOR PAYMENT WITHOUT FURTHER DELAY. WE ARE NOT SUBJECT TO AND CAN NOT BE HELD ACCOUNTABLE TO CONTRACTS CLOSED BY THE GOVERNMENT WITH THE STANDARD OIL COMPANY OR ANYONE ELSE OTHER THAN THE GULF REFINING COMPANY.

IT BEING THE DUTY OF THE PURCHASING OFFICER, ACTING FOR AND IN BEHALF OF THE UNITED STATES, TO PURCHASE THE GASOLINE UNDER THE CONTRACT IN QUESTION THE PURCHASE THEREOF BY SAID OFFICER IN THE OPEN MARKET AT A PRICE IN EXCESS OF THAT STIPULATED IN THE CONTRACT WAS BEYOND THE SCOPE OF HIS AUTHORITY. WHERE AN AGENT OF THE GOVERNMENT ACTS IN EXCESS OF THE AUTHORITY VESTED IN HIM, HIS ACT, FROM A LEGAL STANDPOINT, IS NO LONGER AN ACT OF THE GOVERNMENT. THE UNDERWRITER, 6 FED.REP./2D) 937. THE GOVERNMENT'S AGENTS OR OFFICERS HAVE ONLY LIMITED POWER AND CERTAIN PRESCRIBED DISCRETION, AND PERSONS DEALING WITH SUCH AGENTS OR OFFICERS MUST, UNDER ALL CIRCUMSTANCES, SEE FOR THEMSELVES THAT SUCH AUTHORITY IS NOT EXCEEDED. THE UNAUTHORIZED ACTS OF SUCH AGENTS CAN NOT OBLIGATE THE GOVERNMENT. FILOR V. UNITED STATES, 9 WALL. 45; WHITESIDE V. UNITED STATES, 93 U.S. 247, 256; 5 COMP. GEN. 124; 6 ID. 158; A-23427, JULY 13, 1928. SINCE THE PURCHASING OFFICER IN THIS CASE WAS AUTHORIZED TO OBLIGATE THE GOVERNMENT ONLY AT THE PRICE STIPULATED IN THE THEN EXISTING CONTRACT, PAYMENT IN EXCESS OF THAT AMOUNT MAY NOT BE MADE UNDER THE APPROPRIATION INVOLVED.

UPON REVIEW, THE SETTLEMENT MUST BE AND IS SUSTAINED.

CHECK NO. 134919 IN THE SUM OF $110.74 WILL BE RETURNED TO THE CLAIMANT.