B-173993, OCT 1, 1971

B-173993: Oct 1, 1971

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SINCE IT WAS THE INTENTION OF BOTH PARTIES THAT THE REMOVAL OF THE PULPWOOD WAS TO BE AT THE PURCHASER'S OPTION. THE INCLUSION OF IT AS MANDATORY IN THE CONTRACT WAS ERROR. ACCARDI: REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 18. AT THE TIME THE TIMBER SALE WAS ADVERTISED AND BID. PAYMENT FOR THE PULPWOOD WAS TO BE BY UNITS AND PAYMENTS MADE PRIOR TO CUTTING. YOU REPORT THAT THE FOREST SERVICE INTENDED WHEN THE SALE WAS ADVERTISED. AT THE TIME THE TIMBER SALE CONTRACT WAS PREPARED AND EXECUTED THE PULPWOOD WAS INCLUDED ALONG WITH THE SAWTIMBER IN TABLE 1 IN DIVISION AT2 OF THE CONTRACT IN ERROR. WE ARE ADVISED THAT ALL OF THE REQUIRED SAWTIMBER HAS BEEN REMOVED AND PAID FOR BY THE CONTRACTOR.

B-173993, OCT 1, 1971

CONTRACT - MUTUAL MISTAKE - REFORMATION DECISION THAT PERFORMANCE UNDER A TIMBER SALE CONTRACT AWARDED TO HENRY SMITH FOR THE REMOVAL OF A QUANTITY OF PINE AND HARDWOOD SAWTIMBER FROM THE SAM HOUSTON NATIONAL FOREST MAY BE CONSIDERED COMPLETE. SINCE IT WAS THE INTENTION OF BOTH PARTIES THAT THE REMOVAL OF THE PULPWOOD WAS TO BE AT THE PURCHASER'S OPTION, THE INCLUSION OF IT AS MANDATORY IN THE CONTRACT WAS ERROR. ACCORDINGLY, THE CONTRACT MAY BE REFORMED TO REFLECT THE INTENTION OF THE PARTIES, AND PERFORMANCE BY THE CONTRACTOR MAY BE CONSIDERED AS COMPLETED.

TO MR. ACCARDI:

REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 18, 1971, REQUESTING A DECISION WHETHER PERFORMANCE UNDER TIMBER SALE CONTRACT 12-11-138-1825, AWARDED TO HENRY SMITH ON OCTOBER 14, 1969, CAN BE CONSIDERED COMPLETED, BASED UPON THE FOLLOWING CIRCUMSTANCES.

AT THE TIME THE TIMBER SALE WAS ADVERTISED AND BID, THE SALE PROSPECTUS AND THE PUBLISHED NOTICE OF SALE REQUIRED THE REMOVAL OF A QUANTITY OF PINE AND HARDWOOD SAWTIMBER FROM FOUR UNITS IN THE SAM HOUSTON NATIONAL FOREST. IN ADDITION, THOSE DOCUMENTS GAVE THE PURCHASER THE OPTION OF REMOVING FROM THE UNITS AN ESTIMATED 1,081 CORDS OF PULPWOOD FOR $1.95 A CORD UPON WRITTEN AGREEMENT BETWEEN THE PARTIES. PAYMENT FOR THE PULPWOOD WAS TO BE BY UNITS AND PAYMENTS MADE PRIOR TO CUTTING.

YOU REPORT THAT THE FOREST SERVICE INTENDED WHEN THE SALE WAS ADVERTISED, AS INDICATED ABOVE, THAT THE REMOVAL OF PULPWOOD WOULD BE AN ELECTIVE, AT THE OPTION OF THE PURCHASER WITH THE APPROVAL OF THE FOREST SERVICE, AND NOT A REQUIREMENT OF THE TIMBER SALE CONTRACT. HOWEVER, AT THE TIME THE TIMBER SALE CONTRACT WAS PREPARED AND EXECUTED THE PULPWOOD WAS INCLUDED ALONG WITH THE SAWTIMBER IN TABLE 1 IN DIVISION AT2 OF THE CONTRACT IN ERROR. THIS RESULTED IN MAKING THE REMOVAL OF THE PULPWOOD MANDATORY, CONTRARY TO THE PROVISIONS OF THE SOLICITATION AND THE INTENTION OF THE FOREST SERVICE.

WE ARE ADVISED THAT ALL OF THE REQUIRED SAWTIMBER HAS BEEN REMOVED AND PAID FOR BY THE CONTRACTOR. HOWEVER, THE CONTRACTOR PAID FOR AND REMOVED THE PULPWOOD FROM ONLY ONE OF THE FOUR UNITS. CLAUSE BT9.2 OF THE CONTRACT PROVIDES THAT IF AT THE TIME THE CONTRACT IS TERMINATED, THE CONTRACTOR HAS FAILED TO CUT PORTIONS OF THE SALE AREA, HE WILL BE LIABLE FOR CERTAIN DAMAGES. CLAUSE BT9.3 PROVIDES THAT ANY SUCH DAMAGES MAY BE OFFSET AGAINST MONEY ADVANCED AND DEPOSITED PURSUANT TO THE CONTRACT.

A LETTER DATED MAY 4, 1971, FROM THE CONTRACTOR STATES THAT HE UNDERSTOOD THAT HE WOULD PAY FOR ONLY THE PULPWOOD THAT HE REMOVED AND THAT "MR. FOUNTAIN TOLD ME I COULD DO IT THIS WAY." JAMES D. FOUNTAIN, WHO APPARENTLY IS THE RANGER REFERRED TO IN THE SALE PROSPECTUS AS THE PERSON PROSPECTIVE BIDDERS SHOULD CONTACT FOR EXPLANATION OF THE CONTRACT REQUIREMENTS, STATES THAT AT THE TIME OF THE SALE HE TOLD THE CONTRACTOR THAT HE COULD CUT PULPWOOD IN SOME UNITS AND NOT IN OTHERS IF HE DID NOT WANT ALL OF THE PULPWOOD.

WHERE, BY REASON OF A MUTUAL MISTAKE, THE CONTRACT AS REDUCED TO WRITING, DOES NOT REFLECT THE ACTUAL AGREEMENT OF THE PARTIES, SUCH MISTAKE IS GROUND FOR REFORMING THE WRITTEN INSTRUMENT IF IT CAN BE ESTABLISHED WHAT THE CONTRACT WAS OR WOULD HAVE BEEN BUT FOR THE MISTAKE. 26 COMP. GEN. 899 (1947); 30 ID. 220 (1950). IT APPEARS TO BE CLEARLY ESTABLISHED THAT THE CUTTING OF THE PULPWOOD WAS INTENDED BY THE PARTIES TO BE OPTIONAL RATHER THAN MANDATORY. THUS, IT IS OBVIOUS THAT THE CONTRACT, AS EXECUTED, DOES NOT CONFORM TO THE REAL INTENTION OF THE PARTIES. ACCORDINGLY, THE CONTRACT MAY BE VIEWED IN THE LIGHT OF THE TRUE UNDERSTANDING AND AGREEMENT OF THE PARTIES, AND YOU ARE ADVISED THAT PERFORMANCE BY THE CONTRACTOR MAY BE CONSIDERED COMPLETED.