B-188144, NOV 8, 1977

B-188144, NOV 8, 1977

1. WHERE U. S. GOVERNMENT EMPLOYEE WHO SIGNED CONTRACT WITH PRIVATE PARTY AS "REPRESENTATIVE" OF SOUTH VIETNAMESE GOVERNMENT WAS ACTUALLY "AGENT" OF U. S. GOVERNMENT, UNITED STATES IS LIABLE TO PRIVATE PARTY FOR VALID CLAIMS ARISING UNDER CONTRACT ON UNDISCLOSED PRINCIPAL THEORY. 2. IRRECONCILABLY CONFLICTING EVIDENCE AS TO WHETHER OR NOT CLAIMANT CONTRACTOR WAS PAID FOR 1 MONTH UNDER CONTRACT HAS NOT CHANGED ON RECONSIDERATION OF CERTIFICATE OF SETTLEMENT AND IS RESOLVED BY ACCEPTING GOVERNMENT'S VERSION THAT PAYMENT WAS MADE. 3. CLAIM AGAINST CONTRACTOR FOR REFUND OF OVERPAYMENT BY U.S. GOVERNMENT NEED NOT BE PURSUED SINCE CONTRACT CALLED FOR PAYMENT IN SOUTH VIETNAMESE PAISTRES WHICH WOULD BE OF NO MONETARY VALUE AT TIME OF ANY JUDGMENT. 4. PAYMENT FOR RENDERING OF SERVICES IN TRANSPORTING PETROLEUM PRODUCTS FROM SOUTH VIETNAM TO SINGAPORE AFTER TERMINATION OF CONTRACT MAY BE MADE QUANTUM MERUIT BASIS DUE TO CONTRACT IMPLIED FROM FACTS; HOWEVER, SINCE U. S. GOVERNMENT WAS NOT PARTY TO, OR RESPONSIBLE FOR, SUBSEQUENT TRANSPORT OF SOUTH VIETNAMESE REFUGEES ORDERED BY SINGAPORE GOVERNMENT, PAYMENT FOR SUCH SERVICES SHOULD NOT BE MADE. 5. WHERE LAW OF COUNTRY WHICH GOVERNED CONTRACT MADE PAYMENT TO ITS NATIONAL IN U.S. DOLLARS ILLEGAL, CONTRACT WAS THERFORE AMENDED TO CALL FOR PAYMENT IN SOUTH VIETNAMESE PIASTRES, AND PAYMENT WAS SO MADE, PAYMENT NOW IN U. S. DOLLARS WOULD NOT BE PERMISSIBLE.

NAM HAI MARINE LINES:

NAM HAI MARINE LINES APPEALS THE CERTIFICATE OF SETTLEMENT, DATED JUNE 23, 1977, ISSUED BY OUR CLAIMS DIVISION, REGARDING A CLAIM AMOUNTING TO $76,000 FOR THE PERIOD OF APRIL 9-JUNE 9, 1975, UNDER CONTRACT NO. RVNAF- SS-75-2, DATED FEBRUARY 3, 1975. THAT CONTRACT WAS FOR THE TRANSPORTATION OF PETROLEUM PRODUCTS WITHIN SOUTH VIETNAM AND WAS SIGNED BY NGUYEN VAN BA AS OWNER OF THE NAM HAI MARINE LINES AND BY A "REPRESENTATIVE" OF THE SOUTH VIETNAMESE GOVERNMENT. COMPENSATION UNDER THE CONTRACT WAS ORIGINALLY $38,000 PER MONTH, BUT THIS WAS CHANGED BY AN AMENDMENT TO THE CONTRACT TO $38,000 TO BE PAID IN THE EQUIVALENT AMOUNT OF PIASTRES AS DETERMINED BY THE OFFICIAL RATE OF EXCHANGE ON THE DATE OF PAYMENT. PAYMENT WAS TO BE MADE ON THE NINTH OF EACH MONTH BY CHECK THROUGH THE NATIONAL BANK OF VIETNAM. ACCORDING TO THE "REPRESENTATIVE," THE LAST PAYMENT UNDER THE CONTRACT WAS MADE ON APRIL 26, 1975, IN PIASTRES TO THE WIFE OF MR. BA, COVERING THE APRIL 9-MAY 9 PERIOD. THE CONTRACT WAS TERMINATED ON APRIL 29, 1975. PAYMENT OF $15,200.04 WAS ALLOWED FOR THE PERIOD OF APRIL 29-MAY 11, 1975, ONLY, FOR THE FOLLOWING REASONS.

THE DEPARTMENT OF THE ARMY DID NOT BELIEVE THAT A CONTRACT HAD EXISTED BETWEEN THE CLAIMANT AND THE UNITED STATES GOVERNMENT BECAUSE THE "REPRESENTATIVE," ALTHOUGH A UNITED STATES GOVERNMENT EMPLOYEE, SIGNED THE CONTRACT ON BEHALF OF THE SOUTH VIETNAMESE GOVERNMENT. HOWEVER, INASMUCH AS (1) THE "REPRESENTATIVE" WAS AN EMPLOYEE FROM THE UNITED STATES GOVERNMENT OFFICE (DAO - DEFENSE ATTACHE OFFICE) WHO HAD, PRIOR TO THE ADOPTION OF THE "REPRESENTATIVE" CONTRACTING ARRANGEMENT, PURCHASED PETROLEUM PRODUCTS AND TRANSPORT NEEDS FOR THE SAME PURPOSES DIRECTLY FOR THE UNITED STATES GOVERNMENT; (2) THE SOUTH VIETNAMESE GOVERNMENT, UNDER EACH CONTRACTING ARRANGEMENT, MERELY FORWARDED TO THE UNITED STATES GOVERNMENT A STATEMENT OF ITS PETROLEUM PRODUCT NEEDS TO BE MET WITHIN BUDGETARY LIMITATIONS; (3) ALL FUNDS UNDER EACH CONTRACT FOR PAYMENT FOR THE PETROLEUM PRODUCTS AND THE NECESSARY TRANSPORT CAME FROM THE SAME UNITED STATES-DAO FUNDS; AND (4) THE SOLE REASON FOR CHANGING THE CONTRACTING ARRANGEMENT WAS THE NEED TO CIRCUMVENT THE ARAB EMBARGO ON OIL EXPORTS TO THE UNITED STATES, IT WAS FOUND THAT THE "REPRESENTATIVE" MUST BE CONSIDERED TO HAVE BEEN ACTING AS THE AGENT OF AN OSTENSIBLY UNDISCLOSED PRINCIPAL - THE UNITED STATES GOVERNMENT. SEE PACIFIC ROYALTY COMPANY V. WILLIAMS, 227 F.2D 49 (1955); PRASSA V. CORCORAN, 181 N.E. 2D 138, 24 III. 2D 288 (1962); MCCORD V. ASHBAUGH, 352 P.2D 641, 67 N.M. 61 (1960). A PERSON WHO DEALS WITH AN AGENT OF AN UNDISCLOSED PRINCIPAL MAY ELECT TO HOLD EITHER THE AGENT OR THE PRINCIPAL LIABLE. SEE DARR V. KINCHE, 176 SO. 2D 638 (1965); ACORN PAINTING COMPANY V. BROWN, 385 S.W. 2D 812 (1964); BROWN-WRIGHT HOTEL SUPPLY CORPORATION V. BAGEN, 145 S.E. 2D 294, 112 GA. APP. 300 (1965). CONSEQUENTLY, IT WAS DETERMINED THAT RECOVERY AGAINST THE UNITED STATES GOVERNMENT UNDER THE CONTRACT FOR TRANSPORTATION SIGNED BY THE "REPRESENTATIVE" AND MR. BA FOR THE NAM HAI MARINE LINES SHOULD BE CONSIDERED THE SAME AS IF THE CONTRACT HAD BEEN SIGNED BY A REPRESENTATIVE OF THE UNITED STATES.

AS REGARDED THE CLAIM FOR PAYMENT OF $38,000 FOR THE PERIOD FROM APRIL 9 TO MAY 9, 1975, STATEMENTS BY THE PARTIES TO THE CONTRACT WHERE FOUND TO BE IN CONFLICT. THE "REPRESENTATIVE" AND HIS WITNESSES ASSERTED THAT THE MONEY (SOUTH VIETNAMESE PIASTRES) WAS PAID, ALBEIT IN A MANNER CONTRARY TO THE TERMS OF THE CONTRACT, TO THE WIFE OF MR. BA. MR. BA CLAIMED HE WAS NEVER PAID FOR THAT PERIOD. IN VIEW OF THE IRRECONCILABLY CONFLICTING STATEMENTS ABOUT THE PAYMENT FOR THAT PERIOD, IT WAS FOUND THAT THE CLAIMANT HAD NOT SUSTAINED THE BURDEN OF AFFIRMATIVELY PROVING THE MERITS OF THE CLAIM, AND THE AGENCY'S VERSION OF THE EVENTS WAS ACCEPTED THAT MR. BA HAD BEEN PAID THROUGH MAY 9. GENE PETERS, 56 COMP.GEN. 459 (1977), 77-1 CPD 225. SINCE THE CONTRACT WAS TERMINATED BEFORE THE TIME PERIOD FOR WHICH MR. BA WAS PAID HAD ELAPSED, THE QUESTION OF A REFUND TO THE UNITED STATES GOVERNMENT AROSE. WHEN PAYMENT IN FOREIGN CURRENCY PAYABLE IN THE FOREIGN COUNTRY IS CALLED FOR IN A CONTRACT, THE VALUE OF ANY JUDGMENT RECOVERY IS BASED UPON THE VALUE OF THAT FOREIGN CURRENCY AT THE TIME A JUDGMENT IS RENDERED IN AN AMERICAN COURT. DEUTSCHE BANK FILIALE NURNBERG V. HUMPHREY, 272 U.S. 517 (1926); TILLMAN V. RUSSO ASIATIC BANK, 51 F.2D 1023 (1931). SINCE THE SOUTH VIETNAMESE PIASTRE APPARENTLY HAD NO PRESENT VALUE AND MAY HAVE HAD NO VALUE AT THE TIME THE CONTRACT WAS TERMINATED AND THE OVERPAYMENT BECAME PAYABLE, ANY CLAIM FOR THE OVERPAYMENT, IT WAS FOUND, NEED NOT BE PURSUED.

REGARDING THE MATTER OF THE DELIVERY OF THE PETROLEUM PRODUCTS THAT MR. BA HAD ON BOARD AT THE TIME OF THE TERMINATION OF THE CONTRACT TO SINGAPORE (APRIL 29-MAY 11), IT WAS FOUND THAT THIS WAS SEPARATE AND APART FROM THE CONTRACTUAL ARRANGEMENT AND THAT THE CLAIMANT SHOULD BE REIMBURSED FOR SERVICES ON A QUANTUM MERUIT BASIS. UNDER THE CIRCUMSTANCES, THE CLAIMANT WAS FACED WITH POSSESSING CARGO WHICH IT COULD NOT DELIVER UNDER THE CONTRACT. THE CLAIMANT PROTECTED THE CARGO AND SAFELY DELIVERED IT TO A PORT IN ANOTHER COUNTRY WHERE THE "OWNER" (THE UNITED STATES GOVERNMENT) COULD ASSERT ITS RIGHTS. THE UNLOADING OF THE CARGO WAS DONE AT THE SINGAPORE GOVERNMENT'S ORDER. A COPY OF THE RECEIPT FOR THE DEPOSITED PETROLEUM PRODUCTS WAS RENDERED TO THE UNITED STATES BY THE CLAIMANT. IT WAS FOUND THAT ORDINARILY THE LAW WILL NOT IMPLY A PROMISE TO PAY ONE WHO VOLUNTARILY CONFERS A BENEFIT ON ANOTHER. STEVENS V. CONTINENTAL CAN CO., 308 F.2D 100 (1962); POPE & TALBOT, INC., B-186431, JULY 22, 1976, 76-2 CPD 69. HOWEVER, IT WAS DECIDED THAT THE CIRCUMSTANCES ARE SUCH AS TO HAVE CREATED AN IMPLIED CONTRACT SINCE THE "INFERENCE" OF A PROMISE TO PAY FOR THE SERVICES WAS EVIDENT. COMPARE POPE & TALBOT, INC., SUPRA; SEE DICTAMATIC CORPORATION, B-181038, MAY 16, 1974, 74-1 CPD 260; 17 C.J.S. CONTRACTS, SEC. 6, P. 322; DUNN V. PHOENIX VILLAGE, INC., 213 F. SUPP. 936 (1963); DESKOVICK V. PORZIO, 187 A.2D 610, 78 N.J. SUPR. 82 (1963).

THE CLAIM FOR THE PERIOD OF MAY 11 TO JUNE 9, 1975, WAS DENIED BECAUSE THAT PERIOD OF TIME HAD BEEN SPENT CARRYING SOUTH VIETNAMESE REFUGEES TO GUAM UNDER THE ORDER OF THE SINGAPORE GOVERNMENT, AND NO LIABILITY WAS FOUND SINCE THE UNITED STATES GOVERNMENT WAS NOT A PARTY TO, OR RESPONSIBLE FOR, THOSE ACTIONS.

THE REQUEST FOR RECONSIDERATION COVERS THE DENIAL OF THE CLAIM FOR THE PERIOD OF APRIL 9-APRIL 29, 1975. THE CLAIMANT RECOGNIZES FOR THE PURPOSES OF THIS APPEAL THAT OUR OFFICE MUST ACCEPT THE STATEMENT BY THE "REPRESENTATIVE" THAT THE CLAIMANT'S WIFE WAS PAID, ALTHOUGH BOTH MR. BA AND HIS WIFE DISCLAIM BY AFFIDAVITS RECEIPT OF THIS PAYMENT. IT IS CONTENDED THAT THE ALLEGED PAYMENT DID NOT RELIEVE THE GOVERNMENT OF THE LEGAL OBLIGATION TO PAY THE PROPER PARTY. MRS. BA ALLEGEDLY HAD NO INTEREST IN, OR CONNECTION WITH, THE NAM HAI MARINE LINES; PAYMENT TO MRS. BA WAS NOT PROVIDED FOR IN THE AFOREMENTIONED CONTRACT; AND ALLEGEDLY NO ONE WITH THE NECESSARY AUTHORITY TO REPRESENT THE NAM HAI MARINE LINES GAVE THE GOVERNMENT THE RIGHT TO PAY MRS. BA INSTEAD OF THE CHARTER LINE. FINALLY, THE ALLEGED PAYMENT WAS NOT MADE THROUGH THE NATIONAL BANK OF VIETNAM (WHICH WAS APPARENTLY CLOSED THAT DAY) OR BY MEANS OF A CHECK, BOTH OF WHICH WERE REQUIRED BY THE TERMS OF THE CONTRACT.

WE NOTE THAT BY AN INVOICE, DATED APRIL 20, 1975, MR. BA, ON BEHALF OF THE NAM HAI MARINE LINES, REQUESTED THAT PAYMENT FOR THE PERIOD OF APRIL 9 -MAY 9 BE MADE IN THE AMOUNT OF $38,000 (U.S.) TO BANK ACCOUNT NO. 6006 AT THE BANQUE DE L'INDOCHINE IN SINGAPORE. SINCE PAYMENT IN SUCH A MANNER WOULD ALSO BE CONTRARY TO THE PAYMENT TERMS OF THE CONTRACT, THIS INDICATES THAT MR. BA WAS NOT REQUIRING STRICT ADHERENCE TO THOSE TERMS. FURTHERMORE, TWO PARTIES TO A CONTRACT MAY MODIFY THAT CONTRACT BY MUTUAL CONSENT. ACCORDING TO THE CONTRACTING OFFICER, PAYMENT WAS MADE TO MRS. BA, WHO WAS "*** ACTING ON BEHALF OF MR. BA ***." SINCE WE ARE CONFRONTED WITH THE SAME FACTS AND ARGUMENT IS EXISTED IN THE FIRST CONSIDERATION OF THE MATTER, WE HAVE THE SAME IRRECONCILABLY CONFLICTING STATEMENTS CONCERNING PAYMENT FOR THIS PERIOD AND AGAIN FIND THAT THE CLAIMANT HAS NOT SUSTAINED THE BURDEN OF AFFIRMATIVELY PROVING THE MERITS OF THE CLAIM IN THIS REGARD. GENE PETERS, SUPRA.

IN ADDITION, IT IS CONTENDED THAT THE PAYMENT MADE TO MRS. BA WAS CLEARLY NOT THE EQUIVALENT OF $38,000 ON THE DAY PAYMENT WAS MADE. ALLEGEDLY, THE PIASTRE WAS WORTHLESS ON THE DAY OF PAYMENT. APRIL 26, 1975, A FACT WHICH, CLAIMANT CONTENDS, IS RECOGNIZED IN THE CERTIFICATE OF SETTLEMENT. IT IS FURTHER ARGUED THAT THIS IS NOT THE TYPICAL CASE, REFERRING TO THE ABOVE COURT CASES OUR OFFICE CITED, WHERE A CONTRACT CALLS FOR PAYMENT OF A CERTAIN AMOUNT OF A FOREIGN CURRENCY TO BE PAID IN THAT FOREIGN COUNTRY. HERE, INSTEAD, THE AMOUNT OF PIASTRES TO BE PAID WAS TO BE MEASURED, ALLEGEDLY, BY THEIR VALUE TO 38,000 U.S. DOLLARS. THE CONSTANT IN THE PAYMENT EQUATION WAS THE AMOUNT OF $38,000. THE RISK OF CURRENCY FLUCTUATION HERE WAS FLUCTUATION IN THE VALUE OF THE DOLLAR, NOT THE PIASTRE.

THE CERTIFICATE OF SETTLEMENT STATED AS FOLLOWS - "SINCE THE SOUTH VIETNAMESE PIASTRE APPARENTLY HAS NO PRESENT VALUE AND MAY HAVE HAD NO VALUE AT THE TIME THE CONTRACT WAS TERMINATED ***". IT WAS NOT STATED THAT THE PIASTRE WAS WORTHLESS THE DAY PAYMENT WAS MADE. WHILE THE CONTRACTING OFFICER STATES THAT "THERE WAS NO WAY HE (MR. BA) COULD NEGOTIATE OR DEPOSIT THE PAYMENT ***" - APRIL 26 WAS ON A SATURDAY - HE ALSO STATES THAT "MOST BANKS" WERE CLOSED, THEREBY RAISING THE POSSIBILITY THAT MR. BA WAS ABLE THROUGH SOME BANK TO PROFIT FROM THE PAYMENT. FURTHER, PRESUMABLY THE MONEY COULD HAVE BEEN USED IN SOME PROFITABLE MANNER NOT CONNECTED WITH BANKS. THAT THESE MEASURES WERE IMPOSSIBLE OR IMPRACTICABLE HAS NOT BEEN SHOWN.

IN ANY EVENT, THE CONTRACT DID NOT CALL FOR PAYMENT OF $38,000 IN THE VALUE OF PIASTRES THAT A PERSON DEALING WITHOUT EXCHANGE RATES AND KNOWING ALL THE FACTS MIGHT HAVE BEEN WILLING TO PAY. PAYMENT IN PIASTRES WAS TO BE MADE AT THE GOVERNMENT OFFICIAL RATE OF EXCHANGE FOR THE PIASTRE VIS-A- VIS THE DOLLAR ON THE DAY OF PAYMENT. WHILE THE CONTRACT ORIGINALLY PROVIDED FOR PAYMENT IN DOLLARS, PAYMENT IN THAT CURRENCY WAS FOUND TO BE ILLEGAL AND THE CONTRACT WAS MODIFIED TO PROVIDE FOR PAYMENT IN PIASTRES. WHEN MR. BA REQUESTED (APRIL 20 INVOICE) THAT PAYMENT BE MADE IN DOLLARS AND IN SINGAPORE, THE SOUTH VIETNAMESE GOVERNMENT REFUSED TO PERMIT EITHER. CONSEQUENTLY, IN VIEW OF THE FACT THAT PAYMENT WAS MADE IN THE CURRENCY PROVIDED FOR IN THE CONTRACT AND BY THE METHOD OF VALUATION ALSO PROVIDED FOR THEREIN AND IN VIEW OF THE FACT THAT TO HAVE DONE OTHERWISE WOULD HAVE BEEN ILLEGAL, WE DO NOT BELIEVE THAT PAYMENT NOW IN U.S. DOLLARS WOULD BE PERMISSIBLE. A LEGAL RIGHT WHICH DID NOT EXIST FOR THE CLAIMANT UNDER THE LAW OF THE COUNTRY WHOSE LAW WOULD GOVERN THE PERFORMANCE OF THAT CONTRACT CANNOT BE AFFORDED THE CLAIMANT MERELY BECAUSE THE CLAIMANT HAS NOW BROUGHT HIS CLAIM TO A DIFFERENT FORUM. DEUTSCHE BANK FILIALE NURNBERG V. HUMPHREY, SUPRA.

ACCORDINGLY, WE DECLINE TO MODIFY THE FINDINGS SET FORTH IN THE CERTIFICATE OF SETTLEMENT.