NMDMB 05-89

NOTES OF INTEREST AND GUIDANCE (CONT.)

COUNSEL'S CORNER

You may recall from your civics or government
classes in school that the Federal Government is
one of delegated rather than of so-called natural
powers. Both the executive and legislative branches
of Government are delegated specific duties under
the Constitution, and the executive agencies, in
tum, have only that authority which either the
Congress or the President has chosen to bestow upon
them. Accordingly, naval personnel, whether active
duty or civilian, can proceed with a desired course
of action only if there has first been an affirmative
grant of authority, or a series of grants of
authority, that reaches down to them. Of course,
the action to be taken mist also be within any
limitations, restrictions or conditions attached to
each redelegation.

Contracting authority is a perfect example of this
system of delegated powers. It is universally
recognized that the Federal Government has the
inherent authority to contract for supplies and
services in support of the specific duties it is
charged with performing by the Constitution. By
various statutes, contracting authority has been
passed to the heads of agencies within the executive
branch, including the Secretary of the Navy. The
Federal Acquisition Regulation (FAR) sets out a
system whereby these agency heads can redelegate
this authority to other officials within their
respective organizations. The FAR permits agency
heads to create contracting activities and delegate
to the heads of such contracting agencies (called
HCAs) broad authority to manage the agency's
contracting functions. Agency heads, through the
HCAs, also are allowed to redelegate their authority
to enter into and sign contracts on behalf of the
Government to contracting officers. Only contract-
ing officers have the power to bind the Government
in contract and obligate appropriated funds. Each
contracting officer receives his/her appointment in
writing and this “warrant” provides clear instruc-
tions regarding the limits, if any, of the authority
granted.

An unauthorized commitment occurs when an individ-
ual who lacks the requisite delegation of authority
attempts to enter into an agreement for goods or
services with a private party in the name of the
Government. For example, a doctor makes an
unauthorized commitment when he instructs a vendor
to deliver a medical supply item and promises that
the Government will pay for it. An unauthorized
commitment also occurs when a warranted contracting
or ordering officer exceeds or ignores any limita-
tion placed against his/her authority, suck as the
monetary amount of the transactions he/she can
enter, the type of contract he/she can use or the
type of commodity he/she can purchase. I: is
important to recognize that such unai
commitments are not binding on the Gove:
the person making it runs the
personally liable for
purchased.

the cost of the

itens

Contracting and ordering officers m
contract after the fact to cover
commitment. While the FAP. and supp.
Navy regulations do provide for a proce:
unauthorized commitments can be ratified, this can
entail several levels of review and be a pa:
experience for the person making the commitmer
part of a ratification action, the regulations
require this employee to forward to his/ner
commanding officer a complete statement as to the
circumstances surrounding the unauthorized trans-
action and an explanation of why normal procurement
procedures were not followed. Before ratification
will be approved, the commanding officer mus: verify
the accuracy and completeness of the submission and
take appropriate measures to prevent a rec:

rence
of such commitments.

This is an area where “an ounce of prevention is
worth @ pound of cure.” When deal
outside the Government, all naval personnel should
know the limits of their authority and act
accordingly.

parties