B-152276, SEP. 19, 1963

B-152276: Sep 19, 1963

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TO THE SECRETARY OF THE INTERIOR: REFERENCE IS MADE TO LETTER OF AUGUST 13. IT WAS DISCOVERED THAT TWO SMALLER AREAS ADJACENT TO THE WORK COVERED BY THE CONTRACT SHOULD BE MAPPED TO FURNISH REQUIRED ADDITIONAL INFORMATION. WHICH WAS GIVEN. THE CONTRACTOR WAS DIRECTED. THE CONTRACTING OFFICER AND THE CONTRACTOR APPARENTLY EXPECTED THAT THE FOLLOWING LANGUAGE OF THE ORDER FOR CHANGES NO. 1 WOULD ACCURATELY REFLECT THEIR INTENT AS TO THE COMPENSATION FOR MAPPING THE ADDITIONAL ACREAGE: "YOU WILL BE PAID FOR THE PHOTOGRAPHY. TO TOTAL AREA WILL BE THE SUM OF THE AREA MAPPED UNDER THE ORIGINAL CONTRACT PLUS THE AREA MAPPED UNDER THIS ORDER FOR CHANGES.'. IT DEVELOPED THAT THE SUM OF THE ORIGINAL AREA ADDED TO THE TWO ADDITIONAL AREAS TO BE MAPPED WAS IN FACT LESS THAN 50.

B-152276, SEP. 19, 1963

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO LETTER OF AUGUST 13, 1963, FROM THE ADMINISTRATIVE ASSISTANT SECRETARY ASKING WHETHER CONTRACT NO. 14-06-D 4231 WITH THE AEROTECH COMPANY FOR MAPPING SERVICES MAY BE REFORMED TO PROVIDE FOR PAYMENT OF $21,091.90 IN ADDITION TO THAT PROVIDED FOR UNDER THE TERMS OF THE WRITTEN INSTRUMENT EVIDENCING THE CONTRACT.

THE INITIAL CONTRACT WITH AEROTECH PROVIDED FOR PAYMENT UNDER THE FOLLOWING SCHEDULE, WITH A MINIMUM PRICE OF $110,000 EVEN IF THE TOTAL AREA TO BE MAPPED PROVED TO BE LESS THAN 50,000 ACRES:

CHART

ESTIMATED QUANTITY OF AMOUNT

TOTAL AREA TO BE MAPPED UNIT PRICE (MINIMUM) 60,000 ACRES AND OVER

$1.90 PER ACRE $114,000.00 FROM 55,000 TO 59,999 ACRES 2.00 PER ACRE

110,000.00 FROM 50,000 TO 54,999 ACRES 2.20 PER ACRE 110,000.00

AFTER THE CONTRACT HAD BEEN AWARDED ON NOVEMBER 15, 1961, IT WAS DISCOVERED THAT TWO SMALLER AREAS ADJACENT TO THE WORK COVERED BY THE CONTRACT SHOULD BE MAPPED TO FURNISH REQUIRED ADDITIONAL INFORMATION. THE GOVERNMENT'S REPRESENTATIVE INQUIRED OF THE CONTRACTOR'S REPRESENTATIVE WHETHER THE CONTRACTOR WOULD BE WILLING TO PERFORM THIS ADDITIONAL MAPPING FOR THE $1.90 PER ACRE RATE, THE LOWEST RATE ESTABLISHED UNDER THE CONTRACT. THE CONTRACTOR'S REPRESENTATIVE STATED THAT IT WOULD, AND CALLED HIS HOME OFFICE FOR CONFIRMATION, WHICH WAS GIVEN. AT THAT TIME BOTH PARTIES BELIEVED THAT THE ACRES TO BE MAPPED UNDER THE ORIGINAL CONTRACT WOULD BE APPROXIMATELY 53,000 ACRES. THE CONTRACTOR WAS DIRECTED, BY ORDER OF CHANGES NO. 1, DATED DECEMBER 12, 1961, TO MAP THESE TWO ADDITIONAL AREAS, EXPECTED TO TOTAL 14,000 ACRES.

UNDER THE ERRONEOUS ASSUMPTION THAT THE ORIGINAL ACREAGE PLUS THE ADDITIONAL ACREAGE WOULD EXCEED 60,000, THE CONTRACTING OFFICER AND THE CONTRACTOR APPARENTLY EXPECTED THAT THE FOLLOWING LANGUAGE OF THE ORDER FOR CHANGES NO. 1 WOULD ACCURATELY REFLECT THEIR INTENT AS TO THE COMPENSATION FOR MAPPING THE ADDITIONAL ACREAGE:

"YOU WILL BE PAID FOR THE PHOTOGRAPHY, SUPPLEMENTAL CONTROL, TOPOGRAPHIC MAPS, AND RELATED MATERIAL AT THE PRICES SET FORTH IN THE CONTRACT BASED ON THE TOTAL AREA MAPPED.

TO TOTAL AREA WILL BE THE SUM OF THE AREA MAPPED UNDER THE ORIGINAL CONTRACT PLUS THE AREA MAPPED UNDER THIS ORDER FOR CHANGES.'

IT DEVELOPED THAT THE SUM OF THE ORIGINAL AREA ADDED TO THE TWO ADDITIONAL AREAS TO BE MAPPED WAS IN FACT LESS THAN 50,000 ACRES. UPON LEARNING THAT YOUR DEPARTMENT WOULD PAY ONLY $110,000, THE CONTRACTOR PRIOR TO FINAL PAYMENT CLAIMED AN ADDITIONAL $21,091.90, REPRESENTING A CHARGE OF $1.90 AN ACRE FOR MAPPING THE 11,010 ACRES ACTUALLY CONTAINED IN THE TWO SMALL AREAS ADDED TO THE ORIGINAL ACREAGE. IN VIEW OF THE WORDING OF THE CHANGE ORDER, THE CONTRACTING OFFICER REFUSED TO MAKE THE ADDITIONAL PAYMENT. THE QUESTION BEFORE US IS WHETHER THAT LANGUAGE MAY BE REFORMED TO PROVIDE FOR THE REQUESTED PAYMENT.

IN 39 COMP. GEN. 660, 664, WE OBSERVED THE FOLLOWING:

"THE PURPOSE OF REFORMATION IS NOT TO MAKE A NEW AGREEMENT BETWEEN THE PARTIES, BUT, RATHER, TO ESTABLISH THE TRUE EXISTING ONE; THAT IS, TO MAKE THE CONTRACT EXPRESS THE REAL AGREEMENT OF THE PARTIES. IN ORDER TO JUSTIFY REFORMATION OF ANY INSTRUMENT, THE MISTAKE MUST HAVE BEEN IN DRAWING THE INSTRUMENT AND NOT IN MAKING THE AGREEMENT ITSELF. THE MISTAKE MUST OCCUR IN REDUCING TO WRITING THE CONTRACT UPON WHICH THE PARTIES AGREED. REFORMATION IS NOT AUTHORIZED EVEN IF IT BE CLEARLY SHOWN THAT THE PARTIES WOULD HAVE COME TO A CERTAIN AGREEMENT HAD THEY BEEN AWARE OF THE ACTUAL FACTS. SEE SECTION 1548, WILLISTON ON CONTRACTS (REV.ED.)"

IN ACCORD WITH THE ABOVE PRINCIPLES WE MUST CONCLUDE THAT THE PARTIES' MISTAKEN ASSUMPTION OF FACT THAT THE TOTAL SERVICES REQUIRED WOULD EXCEED 60,000 ACRES OF MAPPING DOES NOT ESTABLISH A BASIS FOR REFORMATION. HOWEVER, IT IS SIGNIFICANT THAT IN DRAWING THE LANGUAGE USED IN THE CHANGE ORDER THE PARTIES DID NOT INCORPORATE THEIR ACTUAL BARGAIN. THE ORAL AGREEMENT TO CONTRACT FOR ADDITIONAL SERVICES AT $1.90 AN ACRE WAS NOT CONDITIONED BY A REQUIREMENT THAT THE TOTAL AREA EXCEED A CERTAIN QUANTITY. THEREFORE IT SEEMS APPARENT, NOTWITHSTANDING THE POSITION OF THE CONTRACTING OFFICER, THAT AT THE TIME OF THE AGREEMENT NEITHER PARTY INTENDED THAT THE EXTRA WORK WOULD BE PERFORMED AS A PART OF THE WORK UNDER THE ORIGINAL CONTRACT, BUT RATHER THAT THE EXTRA WORK WOULD BE CONSIDERED SEPARATELY AND PAID FOR AT A $1.90 PER ACRE.

THUS, THROUGH MUTUAL ERROR OF THE PARTIES, THE CHANGE ORDER DOES NOT EXPRESS THE TRUE INTENTION AND UNDERSTANDING OF THE PARTIES, INSOFAR AS IT PROVIDES THAT THE ADDITIONAL ACREAGE WOULD BE CONSIDERED AS A PART OF THE MINIMUM WORK UNDER THE ORIGINAL CONTRACT. IT IS WELL SETTLED THAT UNDER SUCH CIRCUMSTANCES, EITHER PARTY MAY HAVE THE CONTRACT REFORMED TO CONFORM TO THE AGREEMENT MADE, IF IT CAN BE ESTABLISHED CLEARLY WHAT SUCH AGREEMENT WOULD HAVE BEEN BUT FOR THE MISTAKE. SEE 20 COMP. GEN. 533, 538, AND THE NUMEROUS CASES CITED THEREIN.

ACCORDINGLY, THE CONTRACT MAY BE REFORMED TO REFLECT THE ACTUAL BARGAIN OF THE PARTIES BY PROVIDING FOR PAYMENT OF $1.90 AN ACRE FOR THE ADDITIONAL SERVICES.

THE ENCLOSURE SUBMITTED WITH THE LETTER OF AUGUST 13, 1963, IS RETURNED HEREWITH AS REQUESTED.