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MMP514

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  1. Claim vs. Ratification

    Seriously considering proposing a modification to the expired contract - considering that the invoices could be considered a claim (FAR 33.2 - unless I’m missing something in FAR or law) the Contracting Officer has broad discretion in making the determination. Taking this approach, we would need to support an implied contract (FAR 33.203 Applicability) and I believe we could do this. Thoughts??? While I agree that some contractors may take advantage of the government by continuing work, I also feel that utilizing program, legal and contractor personnel to fight with the contractor is a waste of everyone’s time and money – especially when the government received a benefit and would likely pay in the long run. If there is an authority within the FAR or law to quickly and with as little resources/money used, that's the approach we want to take. Our organization will take this as a lesson-learned…..
  2. Claim vs. Ratification

    Folks - thanks for all the input on this.... I'm new to using this board and will certainly do so in the future. Additional details: 1. The contract (for cell phone services) expired December 31st and the contract was explicit in this (ie, no options, nothing that would appear as express or implied authority). 2. The contractor did not stop services and the personnel with the phones continued using the cell phone services; as the customer, they were unaware of the contract expiration. 3. Government personnel realized mid-Feb that the contract had expired and immediately issued a new contract beginning March 1st - thus the contractor is awaiting payment for January and February (invoices have been rejected and the contractor has been contacted). 4. A ratification was initiated and the details revealed that government personnel had not directed the contract to continue - thus ratification through FAR process is not an option. 5. Legal council has advised that we pay the contractor under quantum meruit principles but this seems to be a new concept for all in our organization so I'm having to piece this together. He has provided me a sample D&F for the Payment for Services Received Pursuant to Equitable Quantum Meruit Principles which I am working with the Contracting Officer on finalizing. The question from management is: under what authority do we utilize the quantum meriut principles and does it tie back to the FAR or other authority? What is/or is there a defined process - if not, is there a process we can borrow? What I've found so far.... Regulatory Authority for paying under quantum meruit principles: 1.102 Statement of guiding principles for the Federal (d) “…In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority.” 1.102-3 Acquisition Team. (e) “…If a policy or procedure, or a particular strategy or practice, is in the best interest of the Government and is not specifically addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, Government members of the Team should not assume it is prohibited. Rather, absence of direction should be interpreted as permitting the Team to innovate and use sound business judgment that is otherwise consistent with law and within the limits of their authority. Contracting officers should take the lead in encouraging business process innovations and ensuring that business decisions are sound.” FAR 1.206(d) Nonratifiable commitments. Cases that are not ratifiable under this subsection may be subject to resolution as recommended by the Government Accountability Office under its claim procedure (GAO Policy and Procedures Manual for Guidance of Federal Agencies, Title 4, Chapter 2), or as authorized by FAR Subpart 50.1. Legal advice should be obtained in these cases. Title 4--Claims “…This title contains regulatory material relating to (1) doubtful claims by and against the United States, including loss-and-damage claims, (2) claims which may be paid administratively under regulations issued by the General Accounting Office pursuant to statute, (3) claims which, because of statutory provisions, I may be paid only after settlement by the General Accounting Office, (4) administratively uncollectible debt claims, including loss-and-damage claims; and (5) waiver of claims for erroneous payments of pay and certain a1lowances.” B-195123, July 11, 1979 - “RECOGNITION OF A RIGHT TO PAYMENT ON THIS BASIS, HOWEVER, REQUIRES A SHOWING (1) THAT THE GOVERNMENT RECEIVED A BENEFIT AND (2) THAT THE UNAUTHORIZED ACTION HAS BEEN EXPRESSLY OR IMPLIEDLY RATIFIED BY AUTHORIZED CONTRACTING OFFICIALS OF THE GOVERNMENT. DEFENSE MAPPING AGENCY, B-183915, JUNE 25, 1975, 75-2 CPD 15; THE SINGER COMPANY, B-183878, JUNE 20, 1975, 75-1 CPD 406.“ GAO B-209173, Jan 17, 1983 Payment on Quantum Meruit Basis in Absence of Formal Contract - The Navy requested an advance decision as to the legality of certification for payment to a private firm for services rendered for the maintenance of data processing systems for a 3-month period. The Navy also requested a decision as to which fiscal year appropriation should be charged with the payment. Although the Navy and the firm did not enter into a formally executed contract covering the services for the period in question, the Navy requested that the firm provide the services since the firm had provided them under a recently expired Government contract. Due to technical irregularities and confusion in the Navy procurement process, no express contract arose for the performance of work during this period. GAO held that, although no formal contract existed, the Government received a benefit, and contracting for the services was not prohibited by statute or regulation. Accordingly, payment may be made on a quantum meruit basis. The proper appropriation account to be charged with payment would be the fiscal year appropriation current when the liability for the payment arose. GAO B-213489, MAR 13, 1984 – “IN APPROPRIATE CIRCUMSTANCES, INCLUDING WHEN A CONTRACTING OFFICER DECLINES TO RATIFY AN INFORMAL OR UNAUTHORIZED COMMITMENT, PAYMENT MAY BE MADE 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 GOODS SOLD OR DELIVERED). DELOSS CONSTRUCTION COMPANY, B-196004, NOVEMBER 2, 1979, 80-1 CPD 201.” B-218957 August 1, 1985 - “The record does not disclose that any officer or employee of the Government requested, or was even aware that the telephone company had undertaken the actions in question. In other words, the telephone company was acting as a volunteer….. Where a valid written contract for a procurement was never executed and the agency is unable to establish even an implied agreement to pay for the goods or services provided, the agency may not ratify the procurement retroactively. However, under this Office's claims settlement authority (31 U.S.C. S 3702), the Comptroller General may authorize reimbursement to the contractor on a quantum meruit or quantum valebant basis when certain conditions are met.” http://www.gao.gov/assets/470/465601.pdf Common Law????? A legal treatise is a scholarly legal publication containing all the law relating to a particular area, such as criminal law or trusts and estates. The Restatement (Second) of the Law of Contracts is a legal treatise from the second series of the Restatements of the Law, and seeks to inform judges and lawyers about general principles of contract common law. I'm working on a product for my agency on this topic (once I get it sorted out).... if anyone's interested, let me know and I'll send you the brief. Thanks again!
  3. In situations where the contractor continues to provide services (ie, cell phone services) after the purchase order has expired and submits an invoice, would the contractor need to submit a claim in accordance with FAR 33.206 in order to be paid? FAR 1.602-3 Ratification of unauthorized commitments would not apply (I don't think) because a government representative did not authorize (verbally or in writing) the continuation of services.
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