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B-182781, JAN 22, 1975

B-182781 Jan 22, 1975
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CLAIMS SETTLEMENT DENYING CLAIM FOR EXPENSES ALLEGEDLY INCURRED IN CONSTRUCTING PRIVATE VENTURE STEAM BATH ON ARMY BASE FOR NONAPPROPRIATED FUND ACTIVITY IN SOUTH VIETNAM IN 1970 IS AFFIRMED SINCE (1) NO CONTRACT EXISTED. JUNG WON KIM: THIS DECISION IS RENDERED PURSUANT TO AN APPEAL FROM THE DENIAL ON JULY 2. KIM'S FIRST CONTENTION IS THAT A JUNE 9. LETTER SIGNED BY LIEUTENANT COLONEL (LTC) COUNT WAS NOT MERELY A LETTER OF INTRODUCTION. RATHER WAS WRITTEN APPROVAL BY THE BASE COMMANDER FOR THE STEAM BATH PROJECT. THE BODY OF THE LETTER WAS AS FOLLOWS: "SUBJECT: LETTER OF INTRODUCTION TO WHOM IT MAY CONCERN: MR. WHILE THIS LETTER MAY HAVE ALLOWED MR. WAS TO BE A PRIVATE BUSINESS VENTURE.

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B-182781, JAN 22, 1975

CLAIMS SETTLEMENT DENYING CLAIM FOR EXPENSES ALLEGEDLY INCURRED IN CONSTRUCTING PRIVATE VENTURE STEAM BATH ON ARMY BASE FOR NONAPPROPRIATED FUND ACTIVITY IN SOUTH VIETNAM IN 1970 IS AFFIRMED SINCE (1) NO CONTRACT EXISTED; (2) ARMY OFFICERS CLAIMANT DEALT WITH HAD NO CONTRACTING AUTHORITY; (3) GOVERNMENT NOT BOUND BY UNAUTHORIZED ACTS OF ITS AGENTS; AND (4) CLAIMANT DOES NOT MEET REQUISITES FOR PAYMENT ON QUANTUM MERUIT OR QUANTUM VALEBANT BASIS, I.E., BENEFIT RECEIVED AND UNAUTHORIZED ACT EXPRESSLY OR IMPLIEDLY RATIFIED.

JUNG WON KIM:

THIS DECISION IS RENDERED PURSUANT TO AN APPEAL FROM THE DENIAL ON JULY 2, 1974, BY THE TRANSPORTATION AND CLAIMS DIVISION OF OUR OFFICE OF A CLAIM FOR $80,054 BY MR. JUNG WON KIM FOR EXPENSES ALLEGEDLY INCURRED IN CONSTRUCTING A STEAM BATH AT CAMP ADENIR, A UNITED STATES MILITARY BASE IN SOUTH VIETNAM, IN 1970, FOR USE IN A NONAPPROPRIATED FUND ACTIVITY.

MR. KIM'S FIRST CONTENTION IS THAT A JUNE 9, 1970, LETTER SIGNED BY LIEUTENANT COLONEL (LTC) COUNT WAS NOT MERELY A LETTER OF INTRODUCTION, BUT RATHER WAS WRITTEN APPROVAL BY THE BASE COMMANDER FOR THE STEAM BATH PROJECT. THE BODY OF THE LETTER WAS AS FOLLOWS:

"SUBJECT: LETTER OF INTRODUCTION

TO WHOM IT MAY CONCERN:

MR. JUNG WON KIM HAS APPROVAL TO INSTALL AND OPERATE A STEAM BATH ON CAMP ADENIR."

WHILE THIS LETTER MAY HAVE ALLOWED MR. KIM TO ENTER THE BASE IN ORDER TO BUILD THE STEAM BATH, IT DOES NOT CONSTITUTE A FORMAL CONTRACT AND DOES NOT APPEAR TO OBLIGATE THE UNITED STATES TO BEAR THE COSTS OF CONSTRUCTION.

IT DOES NOT APPEAR THAT MR. KIM OBTAINED PRIOR APPROVAL FROM THE APPROPRIATE OFFICIALS BEFORE BEGINNING WORK ON THE PROJECT WHICH, ACCORDING TO THE RECORD, WAS TO BE A PRIVATE BUSINESS VENTURE. THE RECORD INDICATES THAT UNDER THE APPLICABLE MILITARY REGULATIONS NO CONTRACT AWARDS FOR NONAPPROPRIATED FUND CONSTRUCTION COULD BE MADE EXCEPT THOSE UNDER THE AUSPICES OF THE CENTRAL PURCHASING AGENCY IF APPROVED BY THE ARMY COMMANDER IN VIETNAM.

MR. KIM CONTENDS THAT LOGICALLY HE WOULD NOT HAVE BEEN PERMITTED TO BUILD A STEAM BATH ON A MILITARY BASE UNLESS HE HAD PROPER AUTHORIZATION. OTHERWISE, HE STATES, THE COMMANDER WOULD BE NEGLECTING HIS DUTIES. THE RECORD IS UNCLEAR AS TO WHY LTC COUNT PERMITTED MR. KIM TO BEGIN THE PROJECT, BUT LTC COURSIN, LTC COUNT'S REPLACEMENT IN MID-JULY 1970, STOPPED THE PROJECT WITHIN 1 MONTH OF HIS ARRIVAL.

MR. KIM ARGUES THAT THE ARMY OFFICERS HE DEALT WITH OFFICIALLY REPRESENTED THE UNITED STATES GOVERNMENT, YET, AS STATED IN THE JULY 2, 1974, CLAIMS SETTLEMENT, NO CONTRACT CAN ARISE IF THE OFFICER OR EMPLOYEE OF THE GOVERNMENT HAD NO AUTHORITY TO CONTRACT FOR OR PROCURE SUCH GOODS OR SERVICES. AGENTS OF THE GOVERNMENT MUST HAVE ACTUAL AUTHORITY IN ORDER TO BIND THE UNITED STATES, AND PARTIES ENTERING INTO CONTRACTUAL ARRANGEMENTS WITH THE UNITED STATES ARE, AS A MATTER OF PUBLIC POLICY, CHARGED WITH THE RESPONSIBILITY OF ACCURATELY ASCERTAINING THE EXTENT OF THE AUTHORITY OF THE AGENT ACTING FOR THE GOVERNMENT. SEE FEDERAL CROP INSURANCE CORPORATION V. MERRILL, 332 U.S. 380, 383-4 (1947), AND NEWMAN V. UNITED STATES, 135 F. SUPP. 953, 957 (CT. CL. 1955). HERE, THERE IS NO EVIDENCE THAT SUCH AUTHORITY EXISTED.

MR. KIM NEXT CONTENDS THAT THE OFFICERS WITH WHOM HE DEALT PRESUMABLY KNEW THE APPROPRIATE MILITARY REGULATIONS AND SHOULD BE RESPONSIBLE FOR ANY LOSSES HE HAS SUFFERED. WHILE THIS ISSUE IS OUTSIDE THE SCOPE OF THIS DECISION, AS IT RELATES TO THE PERSONAL LIABILITY OF THESE OFFICERS, IT SHOULD BE NOTED THAT AGENTS MAY BE HELD PERSONALLY LIABLE FOR UNAUTHORIZED CONTRACTS ONLY WHERE THE THIRD PARTY WAS IGNORANT OF THE AGENT'S LACK OF AUTHORIZATION AND WHERE HE ACTED UPON THE FAITH OF EXPRESS OR IMPLIED REPRESENTATIONS THAT THE PROFESSED AGENT HAD THE AUTHORITY. 3 AM. JUR. 2D AGENCY SEC. 298 (1962). CLEARLY THE GOVERNMENT IS NOT BOUND BY THE ACTS OF ITS AGENTS WHEN SUCH ACTS ARE BEYOND THE SCOPE OF THEIR AUTHORITY. POTTER V. UNITED STATES, 167 CT. CL. 28 (1964).

FINALLY, IT IS SUGGESTED THAT THE CLAIM BE RECOGNIZED FOR SERVICES RENDERED ON A QUANTUM MERUIT BASIS, (THE REASONABLE VALUE OF WORK OR LABOR), OR FOR GOODS FURNISHED ON A QUANTUM VALEBANT BASIS (THE REASONABLE VALUE OF THE GOODS SOLD OR DELIVERED). 40 COMP. GEN. 447, 451 (1961). HOWEVER, BEFORE A RIGHT TO PAYMENT UNDER SUCH BASIS MAY BE RECOGNIZED, IT MUST BE SHOWN THAT THE GOVERNMENT HAS RECEIVED A BENEFIT, AND THAT THE UNAUTHORIZED ACTION HAS BEEN EXPRESSLY OR IMPLIEDLY RATIFIED BY AUTHORIZING CONTRACTING OFFICIALS OF THE GOVERNMENT. B-166439, MAY 2, 1969. IN THIS CASE THE REQUISITES HAVE NOT BEEN MET. THERE IS NOTHING IN THE RECORD TO INDICATE THAT THE GOVERNMENT BENEFITTED FROM THIS BUSINESS VENTURE OR THAT THE PROJECT WAS EXPRESSLY OR IMPLIEDLY RATIFIED BY AUTHORIZING CONTRACTING OFFICIALS OF THE GOVERNMENT.

OUR REVIEW OF THE MATERIAL DOES NOT INDICATE THAT THE CLAIMS SETTLEMENT WAS IN ERROR OR UNSUPPORTED BY THE RECORD. OUR DECISIONS HAVE CONSISTENTLY HELD THAT THE BURDEN DOES NOT REST UPON THE GOVERNMENT TO REFUTE CLAIMS PRESENTED FOR SETTLEMENT OR TO REFUTE ALLEGATIONS UPON WHICH SUCH CLAIMS ARE BASED, BUT THAT THE BURDEN IS ON THE CLAIMANTS TO FURNISH EVIDENCE CLEARLY AND SATISFACTORILY PROVING THEIR CLAIMS AND ALL MATTERS INCIDENTAL THERETO WHICH MAY BE NECESSARY TO ESTABLISH THE LEGAL LIABILITY OF THE UNITED STATES AND THE CLAIMANTS' RIGHT TO RECEIVE PAYMENT. 174345, JUNE 13, 1973; B 154688, MAY 29, 1968.

THE CLAIMS SETTLEMENT OF JULY 2, 1974, IS AFFIRMED.

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