"The Executive Power shall be vested in a President of the United States of America." While some specific powers are expressly stated in Article I (i.e., the power as Commander-in-Chief of the armed forces), the term "Executive Power" is not defined in the Constitution; one must look to case law decisions of the Supreme Court to give meaning and content to this term. Case law states that a variety of powers which historically have been integral to the function of governing a nation-state are "inherent" in the Office of the President, even though these powers are not expressly set forth in the Constitution. The power to enter into contracts is one of these powers.

Often referred to as the law-making branch. This body, divided into several offices, exercises certain powers that are provided by the Constitution.

JUDICIAL  Branch

The third branch of the Government. The Constitution provides for the establishment of the Supreme Court and lower courts. The judiciary’s role as final interpreter of the law and the Constitution is established by the Chief Justice Marshall’s landmark decision in the case of Marbury v. Madison.

A promise or set of promises which, if breached, the law will remedy; the law will recognize a duty to carry out the promise. 

Spells out the duties and responsibilities of each party to the contract. If a party fails to perform, the law will step in and provide to the party that is harmed a remedy. The definition of a contract recognizes the duty of both parties and thus, the court will fashion an appropriate remedy for the failure. Contracts may consist of a single promise by one person to another or it may involve any number of persons and any number of promises.

Capacity to contract

Mutual Assent to be bound

Give consideration

Have a lawful purpose

Terms of the contract must be reasonably certain and clear

Form permitted by law

1. Promises by an executor or administrator to answer damages to the estate out of his own assets;
2. Promises to answer for the debt of another;
3. Promises made upon the consideration of marriage;
4. Contracts for the sale of lands or any interest in land; and,
5. Contracts not to be performed within one year of their making.
6. For the Sale of Goods > $500.00

Be supported by documentary evidence of a binding agreement that is in writting (31 U.S.C.&1501)

Oral orders under small purchase threshold may be placed with Federal Supply Schedule contractors and the writing requirement is satisfied by teh contractor's use of a delivery ticket.

Mutual agreement between parties.

Express, intention is evidenced by use of oral or writen words or signs or symbols with specified meanings

Implied in Fact contract parties evidence concent by conduct rather than words or symbols.

Implied in Law Contracts 

Not actual contract, exists where one party has recieved or used something for which it is proper that they shoudl compensate the other.  One person is benefited by another.

Generally speaking, there are two important areas in which quasi-contract cases arise. The first involves emergency situations. Where one performs services for another in an emergency, there is a presumption that the services are performed gratuitously. An exception is made when the performer of the services goes to great trouble or expense in performing the service, and this is allowed to override the presumption of gratuity. Another exception is made where the one performing the service is a professional in that particular line of work. In that instance, a presumption arises that the professional is not performing gratuitously, but rather is pursuing his or her profession. The second area in which quasi-contract cases arise is where one has a duty to do something and someone else voluntarily acts for them so that the duty is discharged or satisfied. The one who had the duty is unjustly enriched and can be required to compensate the acting party in quasi-contract. However, in general, the courts lack jurisdiction to hear a claim against the Government under the quasi-contract doctrine.

"To make all laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof."

This supplies the consititional power for the Government to enter into contract

US Government can only act through agents.

Agent defined as one who represents another person, called a principal in contractual matters.

The relationship created by the association of a principal and agent.

Arises when the principal authorizes the agent to act as his represenative with respect to another person and the agent concents to do so.  (a "third party")

Created by explicit language either in writing or orally.

Agency created orally is generally as binding as agency created by writing, however sometimes more difficult to prove.

Incidental authority.

Agent expressly assigned a task but the minor details are not spelled out.

Defined as "usual customary and necessary"

Not Real or Acutal Authority

Invoked by the courts on equitable grounds.

Doctrine of apparent authority NEVER operates against the United States. But does operate against the contractor.

Somtimes called Agency by Estopple because it is based on the principals representation to the third party that the agent has authority.

Equitable Estoppel

Two Necessary Conditions

1) The Government is acting in its proprietary rather than sovereign capacity

2) The agent of the Government is acting within the scope of his authority.

When these two conditions exist the Gov. may be estopped from denying the binding nature of its agents actuion when the four elements of equitable estoppel are present:  1) the Gov. knew the "true" facts

2) the Gov intended the contractor to rely on its actions

3) the contracto was ignorant of the facts

4) the contractor relied to its detriment.

An agreement made by an agent of the Government, which is not binding because the agent lacked the authority to act, may become binding on the Government upon ratifcation by a superior agent who had the power to grand the authority at the time othe agreement was made.  The head of the Contracting Activity usually has this authority.

The Government is bound only by the actions of its agents who have actual authority, not apparent authority.

Bill will win if he can establish that Alan's offer was still valid when accepted at 1 pm on April 1st.

 Bill will win because Alan never rescinded his offer.  Even though Alan no longer owns the train set, Bill can sue for damages, in example cost he incurred to buy identical train set, to the extent that cost exceeds $200

Coastal won because as long as the parties intended it to be a contract and other essential elements are present, the court will determine a reasonable price. 

Under the UCC the court may determine a reasonable price if the product is commercial in nater and there is a market price that can be used to set a reasonable price.

Whether the contracting officer was aware of the staff judge advocates directive but said nothing to contradict it.

The government is only bound by actual authority, but that authority may be impliedly delegated to another gov official OR there can be an imp[lied ratification of an otherwise unauthorized order.  If the Contracting Officer knew of the SJA's extra work directive and allowed the work to be performed, the CO may have impliedly ratified the extra work.

• A contract is a promise that the law will recognize and remedy if broken; 
• Both parties must have the capacity to understand and appreciate the terms of the contract.
• Parties “mutually assent” to a contract when an offer is accepted under circumstances that objectively demonstrate a meeting of the minds.; 
• Consideration is the name given to that "value" given by each party; 
• The law will not recognize a contract that is for something that one cannot lawfully do; 
• To be enforceable the contract terms must be sufficiently clear; and 
• In the form permitted by law, written, oral, and implied through the conduct of the parties