B-180630, MAY 2, 1974

B-180630: May 2, 1974

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WHO WERE NOT CONTRACTING OFFICIALS. N00221-74-M-5175 WAS ISSUED BY SUPPLY OFFICER. THE PURCHASE ORDER STATED THAT SERVICES WOULD BE NEEDED FOR APPROXIMATELY FOUR DAYS AND THAT THE AMOUNT TO BE PAID FOR THESE SERVICES WAS "NOT TO EXCEED $1800.". THE CONTRACTING OFFICER STATED "*** A PUBLIC EXIGENCY EXISTED AND THAT ALL ACTIONS TAKEN WERE IN THE BEST INTERESTS OF THE GOVERNMENT.". THE NAVY REGIONAL FINANCE CENTER STATED THAT SINCE THE WORK WAS PERFORMED ON A PURCHASE ORDER (DD FORM 1155). PRIOR APPROVAL WAS REQUIRED. THE CLAIM WAS FORWARDED TO THE TRANSPORTATION AND CLAIMS DIVISION OF THIS OFFICE FOR CERTIFICATION. 568.09 "*** FOR WORK AND LABOR PERFORMED WHICH WAS NOT ORDERED BY THE CONTRACT.".

B-180630, MAY 2, 1974

WHERE NAVY PERSONNEL, WHO WERE NOT CONTRACTING OFFICIALS, PURPORTED TO AUTHORIZE CONTRACTOR TO EXCEED $1800 MAXIMUM STATED ON PURCHASE ORDER, WITHOUT HAVING AUTHORITY TO DO SO AND WITHOUT FOLLOWING PROPER PROCEDURES, AND WHERE CONTRACTOR SATISFACTORILY PERFORMED WORK WHICH RESULTED IN SUBSTANTIAL BENEFIT TO GOVERNMENT, CONTRACTOR MAY BE PAID IN FULL FOR SERVICES RENDERED, AS ADMINISTRATIVELY RECOMMENDED, UNDER THEORY OF QUANTUM MERUIT.

TO ELECTROSYN CORP.:

ON SEPTEMBER 25, 1973, PURCHASE ORDER NO. N00221-74-M-5175 WAS ISSUED BY SUPPLY OFFICER, MARE ISLAND NAVAL SHIPYARD, VALLEJO, CALIFORNIA, TO ELECTROSYN CORPORATION, FOR ENGINEERING SERVICES RELATING TO THE INSTALLATION, ADJUSTMENT AND TESTING OF A TANK LEVEL INDICATOR SYSTEM ABOARD THE USS DOLPHIN. THE PURCHASE ORDER STATED THAT SERVICES WOULD BE NEEDED FOR APPROXIMATELY FOUR DAYS AND THAT THE AMOUNT TO BE PAID FOR THESE SERVICES WAS "NOT TO EXCEED $1800."

THE ELECTROSYN FIELD ENGINEER ARRIVED AND COMMENCED WORK AT THE SHIPYARD ON OCTOBER 6, 1973. HOWEVER, DURING TESTING, UNFORESEEN COMPLICATIONS AROSE WHICH NECESSITATED THE SENDING OF CERTAIN EQUIPMENT TO ELECTROSYN'S FACTORY FOR REPAIRS. ALSO, DUE TO THE COMPLICATIONS AND AS A RESULT OF INSTRUCTIONS BY SHIPYARD PERSONNEL, THE ELECTROSYN FIELD ENGINEER SPENT CONSIDERABLY MORE TIME AT WORK ABOARD THE USS DOLPHIN THAN ORIGINALLY ANTICIPATED.

ELECTROSYN SUBMITTED AN INVOICE, DATED OCTOBER 24, 1973, TOTALING $5,491.21. THIS TOTAL INCLUDED THE COST OF TRAVEL TIME, FIELD SERVICE TIME, CHARGES, AND EXPENSES INCLUDING REGULAR HOURS AND OVERTIME HOURS FROM OCTOBER 6 THRU OCTOBER 17, AND FACTORY EXPENSES IN REPAIRING CERTAIN EQUIPMENT.

THE CONTRACTING OFFICER STATED "*** A PUBLIC EXIGENCY EXISTED AND THAT ALL ACTIONS TAKEN WERE IN THE BEST INTERESTS OF THE GOVERNMENT." RECOMMENDED THAT PAYMENT BE ALLOWED IN FULL. THE NAVY REGIONAL FINANCE CENTER STATED THAT SINCE THE WORK WAS PERFORMED ON A PURCHASE ORDER (DD FORM 1155), WHICH, ACCORDING TO ASPR 3-608.2(B)(1), HAS A MONETARY LIMITATION OF $2500, PRIOR APPROVAL WAS REQUIRED, AND THEREFORE, THE CLAIM WAS FORWARDED TO THE TRANSPORTATION AND CLAIMS DIVISION OF THIS OFFICE FOR CERTIFICATION. ON DECEMBER 18, 1973, THE TRANSPORTATION AND CLAIMS DIVISION CERTIFIED THE SUM OF $3,368.09 AS DUE ELECTROSYN. THIS AMOUNT REPRESENTS THE $1800 STIPULATED BY THE PURCHASE ORDER FOR SERVICES AND TRAVELING EXPENSES OF THE ENGINEER AND AN ADDITIONAL SUM OF $1,568.09 "*** FOR WORK AND LABOR PERFORMED WHICH WAS NOT ORDERED BY THE CONTRACT." LETTER DATED JANUARY 7, 1974, ELECTROSYN REQUESTED THE COMPTROLLER GENERAL TO RECONSIDER THE ABOVE SETTLEMENT.

A CLAUSE ON PAGE 3 OF THE PURCHASE ORDER STATED IN PART:

"IF THE TOTAL PRICE OF THIS ORDER WILL EXCEED THE ABOVE AMOUNT OR IF YOU CANNOT FURNISH MATERIAL OR SERVICES IN EXACT ACCORDANCE WITH THE DESCRIPTION AND DELIVERY SCHEDULES SET FORTH HEREIN, NOTIFY THE UNDERSIGNED CONTRACTING OFFICER IMMEDIATELY, GIVING YOUR QUOTATION OR PROPOSED SUBSTITUTION OR CHANGES, AND WITHHOLD PERFORMANCE PENDING REPLY."

WE HAVE HELD IN PREVIOUS CASES INVOLVING SIMILAR LANGUAGE THAT ADDITIONAL COMPENSATION ABOVE THE MAXIMUM AMOUNT STATED IN THE PURCHASE ORDER SHOULD NOT BE ALLOWED SINCE ACCEPTANCE OF THE PURCHASE ORDER AND PERFORMANCE THEREUNDER RESULTED IN A VALID AND BINDING AGREEMENT TO PERFORM ACCORDING TO ITS TERMS. SEE B-155488, JANUARY 26, 1965. HOWEVER, IN THAT CASE THE GOVERNMENT AGENCY INVOLVED TOOK NO ACTION WHICH WOULD HAVE APPEARED TO CHANGE OR AMEND THE TERMS OF THE ORIGINAL AGREEMENT. THE MISTAKE WAS MADE BY THE CONTRACTOR AND THE GOVERNMENT AGENCY "*** IN NO WAY CONTRIBUTED TO THIS MISTAKE ***."

IN THE PRESENT CASE WE DO HAVE AFFIRMATIVE ACTION ON THE PART OF THE GOVERNMENT AGENCY WHICH DIRECTLY RESULTED IN THE INCREASED COSTS TO THE CONTRACTOR. NAVY PERSONNEL, WHO WERE NOT CONTRACTING OFFICIALS, PURPORTED TO AUTHORIZE THE CONTRACTOR TO PERFORM WORK WHICH WOULD EXCEED THE $1800 AMOUNT STATED ON THE PURCHASE ORDER APPARENTLY WITHOUT HAVING THE AUTHORITY TO DO SO AND WITHOUT FOLLOWING THE PROPER PROCEDURES AS OUTLINED IN ASPR SECTION 3-608.4(B).

IN OUR DECISION, B-177607, MARCH 7, 1973, WHICH DEALT WITH FACTS WHICH CLOSELY PARALLEL THOSE IN THE INSTANT CASE, WE STATED:

"HOWEVER, OUR OFFICE HAS PERMITTED PAYMENT IN SIMILAR SITUATIONS FOR UNAUTHORIZED GOODS AND SERVICES RECEIVED ON A QUANTUM VALEBAT OR QUANTUM MERUIT BASIS IF THE GOVERNMENT RECEIVED A BENEFIT THEREFROM AND THE ACQUISITION OF THE UNAUTHORIZED GOODS AND SERVICES WAS RATIFIED BY THE COGNIZANT CONTRACTING OFFICIALS. SEE 46 COMP. GEN. 348 (1966); 40 ID. 447 (1961) ***."

THE CONTRACTING OFFICER REPORTED THAT THE ELECTROSYN FIELD ENGINEER STAYED ON THE JOB, AS DIRECTED BY ALL MARE ISLAND PERSONNEL INVOLVED, AND THAT THE REPAIRS WERE SATISFACTORILY PERFORMED, WHICH RESULTED IN SUBSTANTIAL BENEFIT TO THE GOVERNMENT. RATIFICATION OF THE ORDER WAS ACCOMPLISHED BY THE CONTRACTING OFFICER IN HIS REPORTS OF NOVEMBER 12 AND 20, 1973, IN WHICH HE RECOMMENDED THAT PAYMENT IN THE AMOUNT OF $5,491.21 BE APPROVED. SEE B-166439, MAY 2, 1969. THEREFORE, IN THESE CIRCUMSTANCES, THE CLAIM MAY BE ALLOWED IN THE AMOUNT OF $5,491.21, AS ADMINISTRATIVELY RECOMMENDED.