Sunday, February 18, 2024

THE FIRST RULE OF GOVERNMENT CONTRACTING

The first rule is only the contracting officer speaks and acts for the federal government. No agent has apparent authority to represent the government. No agent has implied authority unless their action is ratified by the contracting officer. Conversely, an agent can bind the contractor through apparent or implied authority.

The contractor's first duty is to identify and contact the contracting officer. The contractor then instructs all contractor personnel on the first rule of contracting with the federal government.

Contractors should maintain constant communication with the contracting officer, engaging her on the status of contract performance. Any change, delay problem, or dispute should be discussed immediately with the contracting officer. (The same rule applies during the contract formation phase.)

The contracting officer has the sole authority to change the contract. Only the contracting officer can do so. No other government employee has the authority to order changes. Constructive changes are breaches of duties implied by law, but these are exceptions to the first rule. Another exception, discussed elsewhere, is the cardinal change doctrine. Suppose the contractor needs help finding the contracting officer. In that case, the contracting officer's failure may be a constructive or cardinal change if the result is a significant change in contract scope.

Counterbalancing the first rule is the second, which addresses the duty of the contracting officer.

Abraham Lincoln once said:  "It is as much the duty of the government to render prompt justice against itself, in favor of citizens, as it is to administer the same between private individuals."  In 1912, the United States Supreme Court, in addressing the duties of the contracting officer, said:  "But the very extent of the power and the conclusive character of his decision raised a corresponding duty that the agent's judgment should be exercised not capriciously or fraudulently, but reasonably, and with due regard to the rights of both contracting parties."

The most resounding pronouncement, however, was made by the Court of Claims in a 1950 opinion when, after referring to the 1912 Supreme Court opinion, the Court of Claims said the contracting officer must not represent either side but must "act as an impartial, unbiased judge."  The Court of Claims said the contracting officer's function was "to act impartially, weighing with an even hand the rights of the parties on the one hand and on the other."  The court recognized the obligation of the contracting officer to represent the government's interests in procurement matters. Still, it stated clearly that "in settling disputes, this is not his function." 


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