B-180538, JAN 17, 1975

B-180538: Jan 17, 1975

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WHERE TIMBER SALES CONTRACT TERMINATION DATE WAS EXTENDED DUE TO DELAY IN PERFORMANCE BEYOND CONTRACTOR'S CONTROL. CONTRACTOR'S CLAIM FOR PAYMENT OF EXCESS AMOUNT PAID FOR TIMBER AS RESULT OF FOREST SERVICE'S ERRONEOUS RATE REDETERMINATION IS ALLOWED. FOR REFUND OF AN ALLEGEDLY UNWARRANTED INCREASE IN STUMPAGE RATES WHICH THAT FIRM WAS COMPELLED TO PAY THE GOVERNMENT UNDER SURPRISE TIMBER SALE. THE CONTRACT WAS SCHEDULED TO TERMINATE ON MARCH 31. WAS EXTENDED TO MARCH 31. THE EXTENSION WITH INCREASED RATES WAS GRANTED PURSUANT TO CLAUSE B3.15 OF THE CONTRACT WHICH PROVIDES THAT IF THE CONTRACT IS EXTENDED AT THE REQUEST OF THE CONTRACTOR. THE FOREST SERVICE WILL MAKE A RATE REDETERMINATION.

B-180538, JAN 17, 1975

WHERE TIMBER SALES CONTRACT TERMINATION DATE WAS EXTENDED DUE TO DELAY IN PERFORMANCE BEYOND CONTRACTOR'S CONTROL, AND CONTRACT PROVIDED THAT SUCH EXTENSION SHOULD BE AT EXISTING RATES, CONTRACTOR'S CLAIM FOR PAYMENT OF EXCESS AMOUNT PAID FOR TIMBER AS RESULT OF FOREST SERVICE'S ERRONEOUS RATE REDETERMINATION IS ALLOWED.

S.D.S. LUMBER COMPANY:

THIS INVOLVES A CLAIM BY S.D.S. LUMBER COMPANY, BINGEN, WASHINGTON, FOR REFUND OF AN ALLEGEDLY UNWARRANTED INCREASE IN STUMPAGE RATES WHICH THAT FIRM WAS COMPELLED TO PAY THE GOVERNMENT UNDER SURPRISE TIMBER SALE, CONTRACT NO. 00780-4, AWARDED JUNE 14, 1966, BY THE U.S. DEPARTMENT OF AGRICULTURE'S FOREST SERVICE, GIFFORD PINCHOT NATIONAL FOREST. ESSENCE, THE CONTRACT PERMITTED THE CONTRACTOR TO REMOVE AND SELL SPECIFIED TIMBER IN EXCHANGE FOR PAYMENT TO THE GOVERNMENT OF SPECIFIED UNIT RATES (COMPUTED ON BOARD FEET) AND THE PERFORMANCE OF VARIOUS MAINTENANCE DUTIES ANCILLARY TO TIMBER REMOVAL. THE CONTRACT WAS SCHEDULED TO TERMINATE ON MARCH 31, 1968, BUT WAS EXTENDED TO MARCH 31, 1969, BY VIRTUE OF AMENDMENT NO. 4 TO THE CONTRACT, EXECUTED MARCH 29, 1968, WITH INCREASED TENTATIVE STUMPAGE RATES AND REVISED BASE INDEX. THE EXTENSION WITH INCREASED RATES WAS GRANTED PURSUANT TO CLAUSE B3.15 OF THE CONTRACT WHICH PROVIDES THAT IF THE CONTRACT IS EXTENDED AT THE REQUEST OF THE CONTRACTOR, THE FOREST SERVICE WILL MAKE A RATE REDETERMINATION.

SUBSEQUENT TO SAID EXTENSION, THE ACCESS ROAD TO THE SALE AREA BECAME BLOCKED BY A SLIDE WHICH LEFT THE ROAD IMPASSABLE, THEREBY PRECLUDING LOGGING OPERATIONS BY THE CONTRACTOR DURING THE 1968 LOGGING SEASON. SUCH SITUATION WAS STILL IN EXISTENCE WHEN THE CONTRACTOR REQUESTED, BY LETTER OF JANUARY 9, 1969, A FURTHER EXTENSION OF THE CONTRACT WITHOUT A RATE REDETERMINATION. AN EXTENSION WAS GRANTED TO MARCH 31, 1970, THROUGH AMENDMENT NO. 5 TO THE CONTRACT, EXECUTED MARCH 25, 1969, BUT THE EXTENSION WAS GRANTED ACCORDING TO THE CONTRACT EXTENSION PROVISIONS OF CLAUSE B3.15, BY WHICH INCREASED STUMPAGE RATES WERE AGAIN LEVIED.

HOWEVER, AFTER BEING ADVISED IN JANUARY 1970 THAT REMOVAL OF THE TIMBER WAS STILL IMPEDED BY THE SLIDE, AND RECONSTRUCTION OF THE ROAD HAD BEEN PREVENTED BY FALL RAINS, THE FOREST SERVICE ADVISED THE CONTRACTOR BY LETTER OF FEBRUARY 19, 1970, THAT IT CONSIDERED THE INTERRUPTION IN CONTRACT PERFORMANCE ATTRIBUTABLE TO FACTORS ABNORMAL AND CLEARLY BEYOND THE CONTRACTOR'S CONTROL. THE CONTRACT WAS EXTENDED TO OCTOBER 31, 1970, THIS TIME PURSUANT TO CLAUSE B8.22 OF THE CONTRACT, PROVIDING FOR EXTENSION OF THE CONTRACT AT EXISTING (AS OPPOSED TO REDETERMINED) RATES WHERE THE DELAY OR INTERRUPTION WAS ATTRIBUTABLE TO CAUSES BEYOND THE CONTRACTOR'S CONTROL.

IN SO GRANTING THE EXTENSION, THE LETTER ADVISED THE CONTRACTOR THAT HIS REQUEST FOR EXTENSION WITHOUT RATE REDETERMINATION, MADE "A YEAR AGO THIS TIME" WAS "OVERLOOKED" FOR "UNDETERMINABLE REASONS." SINCE THE CONTRACT HAD BEEN EXTENDED WITH THE HIGHER REDETERMINED RATES IN EFFECT, THE CONTRACTOR WAS ADVISED THAT HE WOULD BE REQUIRED TO PAY THE HIGHER RATES WHEN THE TIMBER WAS REMOVED. THE FOREST SERVICE ALSO STATED IN ITS LETTER OF FEBRUARY 19, 1970, TO THE CONTRACTOR THAT IT HAD GIVEN CONSIDERATION TO LOWERING THE CURRENT RATES (THE REDETERMINED RATES OF AMENDMENT 5), BUT THAT THE REGIONAL OFFICE DID NOT CONSIDER SUCH PROCEDURE TO BE LEGALLY PERMISSIBLE. INSTEAD, THE CONTRACTOR WAS ADVISED TO REMOVE AND PAY FOR THE TIMBER AT THE HIGHER RATES, AND THEN SUBMIT A CLAIM TO OUR OFFICE FOR THE DIFFERENCE IN STUMPAGE VALUE BETWEEN THE RATES PAID PURSUANT TO THE REDETERMINED RATES OF AMENDMENT NO. 5 AND THE RATES THE CONTRACTOR WOULD HAVE PAID HAD AMENDMENT NO. 5 GRANTED THE EXTENSION UNDER CLAUSE B8.22.

THE CONTRACTOR HAS SUBMITTED A CLAIM FOR $41,948.99 ON SUCH A BASIS, AND THE FOREST SERVICE STATES THAT THE CLAIM HAS BEEN EXAMINED AND VERIFIED AS TO QUANTUM. IN THIS CONNECTION, THE FOREST SERVICE ADVISES THAT THE CONTRACTOR HAS IN FACT PAID FOR THE TIMBER ACCORDING TO THE REDETERMINED RATES OF THE MARCH 25, 1969, AMENDMENT NO. 5. THE FOREST SERVICE THEREFORE RECOMMENDS PAYMENT TO THE CONTRACTOR OF THE EXCESS AMOUNT PAID FOR TIMBER AS A RESULT OF THE ERRONEOUS RATE REDETERMINATION.

IN THESE CIRCUMSTANCES, OUR OFFICE WILL NOT OBJECT TO PAYMENT OF THE CLAIM AS ADMINISTRATIVELY RECOMMENDED, IF OTHERWISE PROPER.