B-169511, MAY 11, 1970

B-169511: May 11, 1970

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SINCE UNITED STATES IS NOT BOUND BY ITS AGENTS' UNAUTHORIZED ACTS NOR ESTOPPED FROM ASSERTING LACK OF AUTHORITY AS DEFENSE. RYDQUIST: REFERENCE IS MADE TO YOUR LETTER DATED MARCH 31. THE TRUCKS WERE USED ON SWANSON RIVER FIRE REHABILITATION WORK DURING THE PERIOD SEPTEMBER 2 TO SEPTEMBER 24. NO FORMAL ORDER FOR THE USE OF THE TRUCKS AND SPECIFYING A RENTAL RATE WAS ISSUED UNTIL SEPTEMBER 24. WAS ISSUED. IT WAS SIGNED BY MR. RICHARD SUND WHO IS REPORTED TO BE AN EMERGENCY FIRE FIGHTER. SUND IS ALSO SHOWN IN THE RECORD OF THE CASE AS HAVING SIGNED PURCHASE ORDERS AND OTHER DOCUMENTS AS A PROJECT FOREMAN OR TIMEKEEPER. HE WAS ADVISED BY LETTER DATED DECEMBER 1. SUND DID NOT HAVE THE AUTHORITY TO ISSUE PURCHASE ORDERS FOR THE BUREAU AND.

B-169511, MAY 11, 1970

VEHICLES--RENTAL BY GOVERNMENT--AUTHORITY CONCERNING UNAUTHORIZED EMPLOYEE'S ISSUANCE OF UNRATIFIED PURCHASE ORDER FOR HIGH RENTAL OF TWO TRUCKS, CREATING INVALID CONTRACT, ADDITIONAL RENTAL OVER THAT ALLOWED MAY NOT BE PAID, IMPROVIDENT RATIFICATION OF ONE PURCHASE ORDER PROVIDING NO BASIS FOR RATIFYING SIMILAR ORDER, CONTRARY TO GOVERNMENT'S INTEREST, SOLELY FOR TREATMENT UNIFORMITY, SINCE UNITED STATES IS NOT BOUND BY ITS AGENTS' UNAUTHORIZED ACTS NOR ESTOPPED FROM ASSERTING LACK OF AUTHORITY AS DEFENSE. PERSONS DEALING WITH GOVERNMENT AGENTS MUST TAKE NOTICE OF THEIR AUTHORITY LIMITATIONS, ALTHOUGH GOVERNMENT UNAUTHORIZED AGENT'S ACT MAY BE RATIFIED BY AGENT HAVING AUTHORITY TO COMMIT GOVERNMENT PRIMARILY AND AT TIME OF RATIFICATION. SEE COMP. GEN. DEC. AND CT. CASES CITED.

TO MRS. RYDQUIST:

REFERENCE IS MADE TO YOUR LETTER DATED MARCH 31, 1970, WITH ENCLOSURES, REQUESTING ON BEHALF OF THE ACTING STATE DIRECTOR, ALASKA, A DECISION AS TO THE PROPRIETY OF CERTIFYING FOR PAYMENT A VOUCHER IN THE AMOUNT OF $7,088.50, REPRESENTING A PORTION OF THE SUM OF $9,000 CLAIMED BY MR. ROBERT C. SAMPSON, ANCHORAGE, ALASKA, FOR THE RENTAL OF TWO 3/4 TON, 4 X 4, 1969 CHEVROLET CARRY-ALL TRUCKS, USED ON THE SWANSON RIVER FIRE REHABILITATION PROJECT DURING THE MONTH OF SEPTEMBER 1969.

ON A BUREAU OF LAND MANAGEMENT FORM, ENTITLED "OFFER FOR THE RENTAL OR LOAN OF EQUIPMENT," MR. SAMPSON SUBMITTED AN OFFER DATED SEPTEMBER 1, 1969, ASSIGNED NO. 50-010-EQD-350, WHEREIN HE AGREED TO FURNISH TWO TRUCKS, AS ABOVE DESCRIBED AND HAVING A STATED PRESENT VALUE OF $5,500 EACH, FOR A MINIMUM PERIOD OF 30 DAYS AT A RENTAL RATE OF $150 PER DAY FOR EACH VEHICLE. THE TRUCKS WERE USED ON SWANSON RIVER FIRE REHABILITATION WORK DURING THE PERIOD SEPTEMBER 2 TO SEPTEMBER 24, 1969, INCLUSIVE, OR FOR A TOTAL PERIOD OF 23 DAYS. NO FORMAL ORDER FOR THE USE OF THE TRUCKS AND SPECIFYING A RENTAL RATE WAS ISSUED UNTIL SEPTEMBER 24, 1969. ON THAT DATE, A PURCHASE ORDER, NO. 102887 (STANDARD FORM NO. 44), IN THE AMOUNT OF $9,000, WAS ISSUED. IT WAS SIGNED BY MR. RICHARD SUND WHO IS REPORTED TO BE AN EMERGENCY FIRE FIGHTER, AND A BROTHER-IN-LAW OF MR. SAMPSON. MR. SUND IS ALSO SHOWN IN THE RECORD OF THE CASE AS HAVING SIGNED PURCHASE ORDERS AND OTHER DOCUMENTS AS A PROJECT FOREMAN OR TIMEKEEPER.

IN CONNECTION WITH AN INVOICE FOR $9,000 SUBMITTED BY MR. SAMPSON, HE WAS ADVISED BY LETTER DATED DECEMBER 1, 1969, FROM MR. DONAL F. MUELLER, ANCHORAGE DISTRICT OFFICE OF THE BUREAU OF LAND MANAGEMENT, THAT MR. SUND DID NOT HAVE THE AUTHORITY TO ISSUE PURCHASE ORDERS FOR THE BUREAU AND, THEREFORE, NO VALID CONTRACT WAS EVER ENTERED INTO WITH MR. SAMPSON FOR THE USE OF HIS TRUCKS DURING THE MONTH OF SEPTEMBER 1969. MR. MUELLER NEVERTHELESS CONSIDERED THAT THE GOVERNMENT SHOULD PAY A REASONABLE AMOUNT FOR THE USE OF THE TRUCKS AND HE PROPOSED TO APPROVE PAYMENT TO MR. SAMPSON OF THE AMOUNT OF $1,911.50 ON HIS CLAIM FOR $9,000. THE SETTLEMENT OFFER WAS COMPUTED BY APPLYING A DAILY RENTAL RATE OF $25 PER VEHICLE, PLUS A MILEAGE RATE OF $0.25. IT APPEARS FROM MR. MUELLER'S LETTER THAT HE DETERMINED SUCH RATES TO BE REASONABLE ON THE BASIS OF DISCUSSIONS WITH LOCAL TRUCK RENTAL AGENCIES.

THE RECORD DOES NOT SHOW THAT MR. SAMPSON AGREED TO ACCEPT THE AMOUNT OF $1,911.50 AS FULL PAYMENT FOR THE USE OF HIS TRUCKS. HOWEVER, A NEW PURCHASE ORDER IN THAT AMOUNT (PURCHASE ORDER NO. 50-010-PHO-298), WAS PREPARED ON JANUARY 16, 1970, AND A CHECK FOR $1,911.50, MADE PAYABLE TO MR. SAMPSON, WAS ISSUED ON JANUARY 29, 1970. RECEIPT OF THE CHECK WAS ACKNOWLEDGED IN A LETTER DATED MARCH 5, 1970, FROM MR. SAMPSON'S ATTORNEY, MR. WARREN C. COLVER OF ANCHORAGE, ALASKA, WITH THE ADVICE THAT THE CHECK HAD NOT BEEN CASHED AND THAT IT WOULD NOT BE CASHED PENDING RESOLUTION OF THE MATTER. MR. COLVER SUGGESTED THAT A VALID AGREEMENT EXISTED FOR RENTAL OF THE TWO TRUCKS FOR A MINIMUM PERIOD OF 30 DAYS AT THE RATE OF $150 PER DAY FOR EACH TRUCK; AND STATED THAT ON AT LEAST TWO OTHER OCCASIONS MR. SUND'S AUTHORITY TO ISSUE PURCHASE ORDERS ON STANDARD FORM NO. 44 WAS RATIFIED AND RECOGNIZED BY THE ANCHORAGE DISTRICT OFFICE OF THE BUREAU OF LAND MANAGEMENT.

ONE OF THE PURCHASE ORDERS CITED BY MR. COLVER, ORDER NO. 102884, COVERS THE USE OF FOUR PICK-UP TRUCKS OF ABOUT THE SAME SIZE AS THE TWO TRUCKS DELIVERED TO THE FIRE REHABILITATION PROJECT BY MR. SAMPSON. MR. CARVER, THE OWNER OF THE FOUR TRUCKS, WAS PAID A TOTAL AMOUNT OF $18,000 ON THE BASIS THAT HIS TRUCKS HAD BEEN USED FOR 29 DAYS AND APPLICATION OF A RENTAL RATE OF $150 PER DAY FOR EACH TRUCK DURING A MINIMUM PERIOD OF 30 DAYS. WE ASSUME THAT, AS IN THE CASE OF THE TWO TRUCKS OWNED BY MR. SAMPSON, MR. CARVER HAD SUBMITTED A TRUCK RENTAL OFFER BEFORE HIS TRUCKS WERE DELIVERED TO THE PROJECT AND THAT HE WAS REQUESTED TO MAKE DELIVERY BY MR. SUND.

IN MR. CARVER'S CASE THE PURCHASE ORDER WAS RATIFIED BY AN INDIVIDUAL WITH AUTHORITY TO BIND THE GOVERNMENT TO A CONTRACT OF THIS TYPE. THERE WAS NO SUCH RATIFICATION ON THE PURCHASE ORDER ISSUED TO MR. SAMPSON. WHILE IT MAY BE THAT THE PURCHASE ORDER ISSUED TO MR. CARVER SHOULD NOT HAVE BEEN RATIFIED, THE FACT THAT IT WAS RATIFIED BOUND THE GOVERNMENT IN ACCORDANCE WITH ITS TERMS. HOWEVER, THE POSSIBLE IMPROVIDENT RATIFICATION OF ONE PURCHASE ORDER PROVIDES NO BASIS FOR RATIFICATION OF A SIMILAR ORDER, CONTRARY TO THE GOVERNMENT'S INTEREST, SOLELY FOR THE PURPOSE OF ACHIEVING UNIFORMITY OF TREATMENT.

IT IS A SETTLED PRINCIPLE OF LAW THAT THE UNITED STATES IS NOT BOUND BY THE UNAUTHORIZED ACTS OF ITS AGENTS, THAT IT IS NOT ESTOPPED TO ASSERT THE LACK OF AUTHORITY AS A DEFENSE, AND THAT PERSONS DEALING WITH AN AGENT OF THE GOVERNMENT MUST TAKE NOTICE OF THE LIMITATIONS OF HIS AUTHORITY. SEE BERNSTEIN ET AL. V. UNITED STATES, 170 CT. CL. 576 (1965). HOWEVER, THE ACT OF AN UNAUTHORIZED AGENT OF THE GOVERNMENT MAY BE RATIFIED BY AN AGENT HAVING THE AUTHORITY TO COMMIT THE GOVERNMENT IN THE FIRST INSTANCE AND AT THE TIME OF RATIFICATION. SEE FORD V. UNITED STATES, 17 CT. CL. 60 (1881); 22 COMP. GEN. 1083 (1943).

SINCE IT IS OUR OPINION THAT MR. SAMPSON IS NOT ENTITLED TO BE PAID AN ADDITIONAL AMOUNT ON HIS RENTAL CLAIM IN THE AMOUNT OF $9,000, A CERTIFICATION FOR PAYMENT ON THE VOUCHER FOR $7,088.50 IS NOT AUTHORIZED. THE VOUCHER IS BEING RETAINED IN OUR FILES. HOWEVER, WE ARE RETURNING HEREWITH THE CORRESPONDENCE AND OTHER DOCUMENTS WHICH WERE ENCLOSED WITH YOUR LETTER.