Board of Contract Appeals General Services Administration Washington, D.C. 20405 DISMISSED FOR LACK OF JURISDICTION: March 18, 1999 GSBCA 14862-SSA GRANT COMMUNICATIONS, INC., Appellant, v. SOCIAL SECURITY ADMINISTRATION, Respondent. Cyrus E. Phillips, IV, of Kilcullen, Wilson and Kilcullen, Chartered, Washington, DC, counsel for Appellant. Eileen M. I. Houghton and Lyman Goon, Office of the General Counsel, Social Security Administration, Baltimore, MD, counsel for Respondent. Before Board Judges DANIELS (Chairman), BORWICK, and WILLIAMS. DANIELS, Board Judge. Grant Communications, Inc. (Grant) appeals a decision by a contracting officer of the Social Security Administration (SSA) assessing liquidated damages on orders placed by SSA against a Federal Supply Schedule contract which had been awarded to Grant by the General Services Administration (GSA). SSA moves to dismiss the case for lack of jurisdiction, on the ground that the decision from which the appeal is taken was not made by a GSA contracting officer, as required by both regulation and the terms of the contract. Grant, in opposing the motion, maintains that the GSA contracting officer with authority to issue a decision delegated her authority to the SSA contracting officer, and that the decision is consequently appealable. We find that no delegation occurred and consequently dismiss the case for lack of jurisdiction. Background In 1995, GSA awarded a Federal Supply Schedule contract to Grant for the provision of investigations of discrimination complaints and reports regarding those investigations. The following year, SSA placed several delivery orders against this contract. The contract required that each report be filed within a specified period and stated that if the contractor failed to deliver a report on time, it would have to pay liquidated damages for each day of tardiness. During the summer and fall of 1996, Grant submitted five invoices to SSA, requesting payment for work performed in various investigations. SSA assessed liquidated damages and withheld those amounts from its payments to Grant. Grant complained about the assessments to both SSA and the GSA contracting officer for this contract, Cindy Jones. Ms. Jones asked Grant to attempt to resolve its differences with SSA, but noted that if it was unable to do so, it could make a claim to her, seeking a decision. On December 27, 1996, Grant wrote to Ms. Jones, reporting that it had been unable to resolve its differences with SSA and asking her to "make a decision . . . on the reduction of payments from SSA." Ms. Jones promptly responded that she would take no action on the request at that time because SSA still wanted to settle the matter. Soon thereafter, SSA invited Grant to provide information as to whether the late deliveries of reports were excusable. Grant did not provide the requested information. In January 1998, Ms. Jones wrote again to Grant, noting that the contractor had made a telephone request for a contracting officer's decision on its dispute with SSA. She again asked that the dispute be resolved between Grant and SSA, and also advised that any claim under the contract would have to be made in writing and submitted to her for decision. Three months later, in response to a telephone inquiry from Grant, Ms. Jones's supervisor, Inez Sanders, wrote to the contractor: My legal counsel has advised me that the dispute is between SSA and Grant Communication[s]. Your dispute with the SSA is in regard[] to a delivery order placed against the GSA contract and not any provisions of the GSA contract. Therefore, if you have filed a valid claim with the SSA, you must request a Contracting Officer's decision from the SSA Contracting Officer. If the dispute cannot be settled, you can seek resolution with the Board of Contract Appeals. On June 19, 1998, Grant asked SSA for a contracting officer's decision regarding the assessment of liquidated damages on the five invoices previously mentioned and one other investigation. A SSA contracting officer, Robert Austin, denied the claim on October 6, 1998. Grant appealed this decision to this Board on January 6, 1999. Discussion The Contract Disputes Act provides that all claims relating to Government contracts -- both those by contractors against the Government and those by the Government against contractors -- shall be the subject of decisions by contracting officers. 41 U.S.C. 605(a) (Supp. II 1996). The Act further provides that each such decision may be appealed to an agency board of contract appeals. Id. 606. In interpreting this law, the Court of Appeals for the Federal Circuit has explained that a contracting officer's decision is "the very linchpin and necessary prerequisite for the board's jurisdiction." McDonnell Douglas Corp. v. United States, 754 F.2d 365, 370 (Fed. Cir. 1985) (citing Paragon Energy Corp. v. United States, 645 F.2d 966, 967 (Ct. Cl. 1981)). For Federal Supply Schedule contracts, such as the one at issue here, the contracting officer charged with issuing decisions which resolve disputes between contractors and the Government is a contracting officer in "the schedule contracting office," which is located within GSA. 48 CFR 8.405-7 (1994). This mandate of the Federal Acquisition Regulation is reflected in a provision of the contract at issue: Any ordering agency may, in respect to any one or more purchase orders placed by it under the contract, exercise the same right of termination, acceptance of inferior articles or services, and assessment of excess costs as might the Contracting Officer, except that when the failure to deliver articles or services is alleged by the contractor to be excusable, the determination of whether the failure is excusable shall be made only by the Contracting Officer of the General Services Administration, to whom such allegation shall be referred by the ordering office and from whose determination appeal shall be taken as provided in the clause to this contract entitled "Disputes." Thus, in accordance with provisions of both the regulation and the contract, only a GSA contracting officer responsible for this contract may issue a decision which resolves a dispute between Grant and the Government, subject to appeal to this Board. Centennial Leasing v. General Services Administration, GSBCA 12321, 93-3 BCA 26,200; Centennial Leasing v. General Services Administration, GSBCA 12311, 93-3 BCA 26,120; Centennial Leasing Corp., GSBCA 10915, et al., 91-2 BCA 23,678; GF Office Furniture, Ltd., GSBCA 11058, 91-3 BCA 24,157. The decision from which Grant appeals was made by a SSA contracting officer, not a GSA contracting officer. Under the regulation, contract provision, and Board decisions cited in the preceding paragraph, such a decision -- notwithstanding the words it contains -- is not capable of resolving the dispute between Grant and the Government and is not appealable to this Board. We do not have jurisdiction to hear this case. Grant maintains that the general rules enunciated above do not apply here because Ms. Sanders, the GSA supervisor whose office was empowered to issue a contracting officer's decision on the contractor's claim, delegated the office's authority to the SSA contracting officer who made the decision at issue. Thus, according to Grant, SSA contracting officer Austin was acting as Ms. Sanders's agent, not on his own, in issuing the decision from which this appeal is taken. In support of this position, Grant quotes a statement from a general treatise on the law, American Jurisprudence: "[I]f relations exist which will constitute an agency, it will be an agency whether the parties understood the exact nature of the relationship or not." 3 Am. Jur. 2d, Agency 21 (1986). Grant's position would be correct only if Ms. Sanders had delegated her own authority to SSA. As explained in the treatise from which the contractor quotes, "The term 'agency' means a fiduciary relationship by which a party confides to another the management of some business to be transacted in the former's name or on his account, and by which such other assumes to do the business and render an account of it." 3 Am. Jur. 2d, Agency 1 (emphasis added). "The fundamental idea of agency has its conception in something lawful that a person may do and a delegation by such person to another of the power lawfully to do that thing." Id. 2. As Ms. Sanders's letter makes plain, she advised Grant to seek a contracting officer's decision from SSA not because she wished to have a SSA official exercise GSA's power to resolve the dispute, but rather, because she believed that GSA had no authority to make a decision on the matter. The letter creates no agency, express or implied. When Mr. Austin issued his decision, he was attempting to carry out what Ms. Sanders had told him was SSA's authority; he was not exercising GSA's authority. Because no SSA contracting officer had the power to resolve a dispute regarding the assessment of liquidated damages on an order placed against Grant's Federal Supply Schedule contract with GSA, the decision has no legal effect. An appeal may not be taken from it. The current status of Grant's disputes with SSA regarding the assessment of liquidated damages on orders placed against this contract is as follows. A request for a GSA contracting officer's decision on the deductions taken by SSA from the five initial invoices has been pending since December 27, 1996. Because the amount in dispute is not more than $100,000 and a GSA contracting officer has not yet issued a decision on this matter, Grant's claim is deemed to have been denied and the contractor may file an appeal from this deemed denial. 41 U.S.C. 605(c)(5). Grant has not yet (at least as far as our record is concerned) asked the GSA contracting officer to resolve the contractor's dispute with SSA regarding the assessment of liquidated damages as to the last investigation noted in Grant's letter of June 19, 1998, to SSA. If Grant wishes to pursue this matter before the Board, it must first seek a GSA contracting officer's decision on it and then, having received a decision on the claim (or having had sixty days pass without issuance of a decision, and thus having had the claim deemed to have been denied), it may file an appeal.[foot #] 1 Decision This case is DISMISSED FOR LACK OF JURISDICTION. _________________________ STEPHEN M. DANIELS Board Judge We concur: _________________________ _________________________ ANTHONY S. BORWICK MARY ELLEN COSTER WILLIAMS Board Judge Board Judge ----------- FOOTNOTE BEGINS --------- [foot #] 1 The analysis of relevant law contained in this opinion, and the application of that law to the facts of the case, is in our judgment correct. We can well appreciate, however, that the reader, especially if he or she is not an attorney, may not find that what we have said makes sense. As we have suggested before, the virtue of requiring a GSA contracting officer who has only general knowledge of the terms of a contract to rule on a dispute involving the application of those terms to a specific situation which is well known to an agency contracting officer is not readily apparent. Centennial Leasing, 91-2 BCA __________________ 23,678. Ms. Sanders's letter, while not faithful to the law as it exists, appears to reflect a reasonable perception that the current regulation imposes an inappropriate burden on GSA schedule contracting officers and wastes the time of contractors by forcing them to pursue dispute resolution with representatives of two agencies, rather than one. As long as the law remains as it is, however, we must continue to follow it.