Payment for Work Done Outside of a Valid Contract

B-197568: Feb 12, 1980

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An agency issued a $5,880 purchase order to a construction company for an estimated total 200-hour lease of various fully manned construction equipment. Because sufficient fiscal year funding could not be identified by the agency at the time to cover all the work needed, the purchase order was limited to only a portion of the work. The remainder of the work was to be accomplished in the future when and if appropriate funding was received. Additional funding became available without the knowledge of the contracting officer after the work was begun, and personnel supervising the performance of the contract told the contractor to complete all of the planned work at the cost of $12,544.50. Therefore, a portion of the work was performed outside of a valid contract. If a contract for the entire amount had been contemplated, the procurement would have had to have been formally advertised, since it would have been for an amount over $10,000. Despite this, an authorized certifying officer recommended that the contractor be paid the full amount due it. The courts and GAO have recognized that in appropriate circumstances payment may be made on a quantum meruit or quantum valebant basis where there is no formal contract upon which to base payment. Appropriate circumstances exist where the Government received a benefit from the goods and/or services and where the unauthorized procurement has been expressly or impliedly ratified by authorized officials of the Government. The record showed that the Government benefited from the work done by the contractor in this case. The amount charged for the work appeared to be reasonable, and an implied ratification of the procurement may be inferred from the acceptance of the work and the recommendation on behalf of the activity that the amount be paid. Accordingly, the voucher was authorized for payment.