B-148394, JUN. 26, 1963

B-148394, JUN. 26, 1963

TO BRAZILIAN GOVERNMENT TRADE BUREAU:

WE HAVE YOUR LETTERS OF FEBRUARY 15 AND MARCH 5, 1963, REQUESTING RECONSIDERATION OF OUR DECISIONS OF JUNE 28, 1962, AND FEBRUARY 1, 1963, AND RESUBMITTING A CLAIM FOR $282,000 ARISING OUT OF CONTRACT NO. GS-OOP- 3626 (SCM), ENTERED INTO DECEMBER 23, 1952, BY THE UNITED STATES OF AMERICA, ACTING THROUGH THE GENERAL SERVICES ADMINISTRATION, AND THE UNITED STATES OF AMERICA, ACTING THROUGH THE GENERAL SERVICES ADMINISTRATION, AND THE UNITED STATES OF BRAZIL, ACTING THROUGH THE BANK OF BRAZIL, UNDER WHICH THE UNITED STATES OF AMERICA PURCHASED QUANTITIES OF MONAZITE SANDS AND RARE EARTH CHLORIDES.

ARTICLE VII OF THE CONTRACT PROVIDED IN PART, WITH RESPECT TO THE PRICE TO BE PAID FOR THE RARE EARTH CHLORIDES, AS FOLLOWS:

"B) THE PRICE FOR RARE EARTH CHLORIDE MEETING THE SPECIFICATIONS SET FORTH IN ARTICLE V ABOVE SHALL BE SEVENTY-SEVEN CENTS ($0.77) PER KILO OF MATERIAL.

"THE ABOVE PRICES SHALL INCLUDE ALL DUTIES, TAXES, AND OTHER LEVIES IMPOSED BY ANY GOVERNMENT OTHER THAN THE GOVERNMENT OF THE UNITED STATES OF AMERICA, IT BEING INTENDED THAT THE MATERIAL SOLD HEREUNDER SHALL BE DELIVERED TO THE GSA F.O.B. VESSEL BRAZILIAN PORT FREE OF ALL SUCH TAXES OR CHARGES, IF ANY.

"IN COMPUTING THE ABOVE PRICE FOR RARE EARTH CHLORIDE THERE HAS BEEN TAKEN INTO ACCOUNT THE UNITED STATES OF AMERICA IMPORT DUTY WHICH APPLIES TO SUCH MATERIAL AS OF THE DATE THAT IT ENTERS A U.S.A. PORT. IF AT THE TIME ANY LOT OF RARE EARTH CHLORIDE ENTERS A U.S.A. PORT, THE RATE OF U.S.A. IMPORT DUTY DIFFERS FROM THE RATE EXISTING ON THE DATE THAT THE PARTIES THERETO AFFIXED THEIR SIGNATURES TO THIS CONTRACT, THE PRICE FOR SUCH LOT WILL BE APPROPRIATELY ADJUSTED.'

NEGOTIATIONS LEADING TO THE CONTRACT WERE CARRIED ON IN BRAZIL DURING AUGUST AND SEPTEMBER 1952. IN A MEMORANDUM DATED SEPTEMBER 16, 1952, WRITTEN BY ONE OF THE UNITED STATES OF AMERICA NEGOTIATORS IT WAS NOTED THAT THE PRICE FINALLY OFFERED BY THE UNITED STATES OF AMERICA FOR RARE EARTH CHLORIDES WAS COMPUTED TAKING INTO ACCOUNT A 35 PERCENT AD VALOREM DUTY ALTHOUGH THE BRAZILIAN NEGOTIATORS ADVANCED ARGUMENTS AGAINST THE CONSIDERATION OF DUTY IN THE PRICE NEGOTIATIONS. THE UNITED STATES OF AMERICA NEGOTIATORS WERE SAID IN THE MEMORANDUM TO HAVE POINTED OUT THAT "* * * UNDER THE LAW AND POLICY BEHIND PUBLIC LAW 520 STOCKPILE TRANSACTIONS REQUIRED THAT THE DUTY BE TAKEN INTO ACCOUNT TO ITS FULLEST EXTENT AND THAT THE UNITED STATES NEGOTIATORS HAD NO POWER TO DO OTHERWISE AND THAT THEIR AGENCIES HAD NO SUCH POWER AND HAD NO AUTHORITY OVER THE DETERMINATION OF IMPORT DUTIES.' PRESUMABLY THE OBJECTIONS OF THE BRAZILIAN NEGOTIATORS TO CONSIDERATION OF THE DUTY IN THE PRICE LED TO THE INCLUSION OF THE LAST PARAGRAPH OF ARTICLE VII (B) QUOTED ABOVE.

INITIAL SHIPMENTS OF RARE EARTH CHLORIDES WERE PAID FOR ON THE BASIS OF A 35 PERCENT RATE OF DUTY UNTIL MARCH 21, 1953. SHIPMENTS THEREAFTER WERE PAID FOR ON THE BASIS OF A 30 PERCENT RATE IN ACCORDANCE WITH THE TORQUAY AGREEMENT. SUBSEQUENTLY THE ACCURACY OF THOSE RATES AND THE INTERPRETATION OF THE QUOTED PORTION OF THE CONTRACT ARTICLE RELATING TO PRICE WERE QUESTIONED AND IN OUR DECISION OF JUNE 28, 1962, WE HELD THAT THE LANGUAGE OF ARTICLE VII (B) CONTEMPLATED THE APPLICATION OF A RATE OF DUTY WHICH WOULD HAVE BEEN COLLECTED BUT FOR THE STATUTORY EXEMPTION, AND THAT THE SAID RATE WAS SUCH AS TO REQUIRE AN ADDITIONAL PAYMENT TO BRAZIL, WHICH PAYMENT HAS BEEN MADE.

BY LETTER OF DECEMBER 21, 1962, WITH ENCLOSURES, A CLAIM FOR THE DIFFERENCE BETWEEN THE AMOUNT ORIGINALLY CLAIMED AND THE AMOUNT PAID AS A RESULT OF OUR DECISION OF JUNE 28, 1962, WAS SUBMITTED. THAT CLAIM WAS DENIED BY OUR DECISION OF FEBRUARY 1, 1963, ON THE BASIS THAT, AS SUBMITTED, IT REPRESENTED A REQUEST THAT THE CONTRACT BE REFORMED WHICH, IN OUR JUDGMENT, THE FACTS AND LAW DID NOT WARRANT.

THE PRESENT CLAIM IS BASED ON TWO POINTS. THE FIRST OF THESE IS THAT THE BRAZILIAN NEGOTIATORS WERE INDUCED TO ACCEPT THE PRICE CLAUSE OF THE CONTRACT BY THE REPRESENTATION OF THE UNITED STATES OF AMERICA NEGOTIATORS THAT THE UNITED STATES LAW REQUIRED DUTY TO BE TAKEN INTO ACCOUNT AND THAT THEY HAD NO AUTHORITY TO DO OTHERWISE. IN SUPPORT OF THE CLAIM ON THIS BASIS THERE IS CITED OUR DECISION B-145104, JULY 20, 1961, 41 COMP. GEN. 34. WHILE YOU DO NOT USE THE TERM, SINCE THE CITED CASE IS BASED ON THE THEORY OF REFORMATION WE CONSIDER THAT YOU ARE REQUESTING THAT THE SUBJECT CONTRACT ALSO BE REFORMED.

WE THINK THERE IS CONSIDERABLE QUESTION AS TO WHETHER THE UNITED STATES OF AMERICA NEGOTIATORS MADE A MISREPRESENTATION AT THE TIME OF THE NEGOTIATIONS. WHILE THE LANGUAGE OF PUBLIC LAW 520, APPROVED JULY 23, 1946, 60 STAT. 596 (50 U.S.C. 98-98H), DOES NOT STATE THAT DUTY MUST BE TAKEN INTO CONSIDERATION, SECTION 1 OF THE ACT ESTABLISHES AS A MATTER OF POLICY THAT THE PURPOSE AND INTENT OF THE ACT IS TO PROVIDE FOR THE ACQUISITION AND RETENTION OF STOCKS OF CERTAIN STRATEGIC AND CRITICAL MATERIALS AND TO ENCOURAGE THE CONSERVATION AND DEVELOPMENT OF SOURCES OF THESE MATERIALS WITHIN THE UNITED STATES, AND THEREBY DECREASE AND PREVENT WHEREVER POSSIBLE A DANGEROUS AND COSTLY DEPENDENCE OF THE UNITED STATES UPON FOREIGN NATIONS FOR SUPPLIES OF THESE MATERIALS IN TIMES OF NATIONAL EMERGENCY. SECTION 2 OF THE ACT AUTHORIZES THE SECRETARY OF THE ARMY, THE SECRETARY OF THE AIR FORCE, THE SECRETARY OF THE NAVY, AND THE SECRETARY OF THE INTERIOR, ACTING JOINTLY THROUGH THE AGENCY OF THE MUNITIONS BOARD, TO EFFECTUATE THE POLICY SET FORTH IN SECTION 1 OF THE ACT BY DETERMINING WHICH MATERIALS ARE STRATEGIC AND CRITICAL AND THE QUANTITIES AND QUALITIES OF SUCH MATERIALS WHICH SHALL BE STOCKPILED. SECTION 3 PROVIDES THAT THE SECRETARY OF THE ARMY, THE SECRETARY OF THE AIR FORCE, AND THE SECRETARY OF THE NAVY SHALL DIRECT THE ADMINISTRATOR OF GENERAL SERVICES TO MAKE PURCHASES OF STRATEGIC AND CRITICAL MATERIALS WITH DUE REGARD TO THE OBJECTIVES SET FORTH IN SECTION 1 OF THE ACT, AND OTHER CRITERIA.

THE MUNITIONS BOARD BY LETTER DATED AUGUST 19, 1948, TO THE DIRECTOR, BUREAU OF FEDERAL SUPPLY, TREASURY DEPARTMENT, WHICH BUREAU WAS ABOLISHED AND ITS FUNCTIONS TRANSFERRED TO THE ADMINISTRATOR OF GENERAL SERVICES BY THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, DIRECTED THAT CERTAIN PROCEDURES BE FOLLOWED IN STOCKPILE PURCHASES. IN PERTINENT PART THE LETTER OF AUGUST 19, 1948, IS AS FOLLOWS:

"REFERENCE IS MADE TO YOUR LETTER OF 7 JULY 1948, CONCERNING CLEARANCE WITH THE MUNITIONS BOARD OF INDIVIDUAL STOCKPILE PURCHASE PROPOSALS.

"IT HAS BEEN OUR DESIRE TO MINIMIZE THE AMOUNT OF TIME CONSUMED IN CLOSING DESIRABLE PURCHASES, BUT AT THE SAME TIME TO MOVE CAREFULLY SO AS TO INSURE THAT EACH PURCHASE WAS IN FACT DESIRABLE. WE FEEL THAT POLICIES HAVE BEEN SUFFICIENTLY ESTABLISHED BY THIS TIME TO PERMIT A CONSIDERABLE WITHDRAWAL OF OUR PREVIOUSLY EXPRESSED DESIRE TO PASS UPON INDIVIDUAL CASES. IT IS THEREFORE REQUESTED THAT THE FOLLOWING PROCEDURE BE PLACED IN EFFECT.

"4. PRICE

"THE MATTER OF PRICE IS OF MAJOR IMPORTANCE TO THE MUNITIONS BOARD. GOOD JUDGMENT SHOULD BE USED IN THE TIMING OF PURCHASES AND THE QUANTITIES PURCHASED AT ANY ONE TIME, SO AS TO MINIMIZE THE ADVERSE EFFECT ON THE MARKET.

"THE MUNITIONS BOARD SHOULD BE ADVISED OF ANY MAJOR PRICE CHANGES. THE PRICE OF ANY MATERIAL INCREASES MORE THAN TEN PERCENT ABOVE THE PRESENT PRICE, PURCHASE OF THAT MATERIAL SHOULD IMMEDIATELY BE DISCONTINUED AND YOUR BUREAU SHOULD SUBMIT RECOMMENDATIONS ON FURTHER PROCEDURE TO THE MUNITIONS BOARD.

"WE FEEL THAT THE MATERIALS INVOLVED CAN BE DIVIDED INTO FOUR GROUPS, FOR EACH OF WHICH A GENERAL PRICE CRITERION CAN BE ESTABLISHED.

"A. MATERIALS FOR WHICH THERE ARE REGULARLY QUOTED MARKET PRICES, WHICH QUOTATIONS USUALLY ARE CONSTANT FOR PERIODS OF UP TO A YEAR. IN SUCH INSTANCES, THE PRICE TO BE PAID SHOULD NOT EXCEED THE QUOTED MARKET PRICE, AT THE TIME THE PROPOSAL IS ACCEPTED, WITH PROPER ALLOWANCES FOR GRADE OF MATERIAL AND F.O.B. POINT. WHERE FOREIGN MATERIAL IS INVOLVED, THE COMPARISON SHOULD BE ON THE BASIS OF THE DOMESTIC QUOTATION LESS ANY DUTY IN EFFECT AT THE TIME THE PROPOSAL IS ACCEPTED. * * *.

"B. MATERIALS FOR WHICH THERE ARE APPROXIMATE MARKET PRICE QUOTATIONS, WHICH QUOTATIONS ARE USUALLY STABLE OVER A PERIOD OF A MONTH OR MORE. SUCH INSTANCES, THE PRICE TO BE PAID SHOULD NOT EXCEED YOUR BEST EVALUATION, AFTER CONSULTATION WITH RELIABLE INDUSTRY CONTRACTS, AS TO WHAT CONSTITUTES THE "MARKET PRICE" FOR THAT MATERIAL AT THE TIME THE PROPOSAL IS ACCEPTED, CONSIDERING THE GRADE INVOLVED AND THE F.O.B. POINT. AS IN GROUP (A), ADJUSTMENT WOULD BE MADE FOR ANY EXISTING DUTY.'

THUS, THE MUNITIONS BOARD, ACTING FOR THE SECRETARY OF THE ARMY, THE SECRETARY OF THE AIR FORCE, AND THE SECRETARY OF THE NAVY, DID DIRECT, UNDER THE AUTHORITY OF SECTION 3 OF PUBLIC LAW 520, THAT WHERE FOREIGN MATERIAL IS INVOLVED THE PRICE SHOULD NOT EXCEED THE QUOTED MARKET PRICE, OR THE BEST EVALUATION, AFTER CONSULTATION WITH INDUSTRY CONTRACTS AS TO WHAT CONSTITUTES THE MARKET PRICE, LESS ANY DUTY IN EFFECT AT THE TIME THE PROPOSAL IS ACCEPTED. SO FAR AS WE ARE AWARE THIS DIRECTIVE WAS IN EFFECT AT THE TIME THE NEGOTIATIONS LEADING TO THE CONTRACT IN QUESTION WERE CARRIED OUT IN 1952. IN FACT THE NEGOTIATOR FOR THE GENERAL SERVICES ADMINISTRATION WAS SPECIFICALLY INFORMED BY THE DIRECTOR, FOREIGN EXPANSION DIVISION, DEFENSE MATERIALS PROCUREMENT AGENCY, ON AUGUST 11, 1952, THAT THE QUESTION OF DUTY MUST BE CONSIDERED IN ARRIVING AT COMPETITIVE MARKET PRICES. THEREFORE, THE UNITED STATES OF AMERICA NEGOTIATORS WERE BOUND TO TAKE DUTY INTO CONSIDERATION. SINCE THE MUNITIONS BOARD DIRECTIVE WAS ISSUED BY AN AGENCY AUTHORIZED BY PUBLIC LAW 520 TO DIRECT THE ADMINISTRATOR OF GENERAL SERVICES TO MAKE PURCHASES OF STRATEGIC AND CRITICAL MATERIALS IN ACCORDANCE WITH THE OBJECTIVES OF PUBLIC LAW 520, WE HAVE CONSIDERABLE DOUBT THAT THE REPORTED STATEMENT OF THE UNITED STATES OF AMERICA NEGOTIATORS THAT "* * * UNDER THE LAW AND POLICY BEHIND PUBLIC LAW 520 STOCKPILE TRANSACTIONS REQUIRED THAT THE DUTY BE TAKEN INTO ACCOUNT TO ITS FULLEST EXTENT AND THAT THE UNITED STATES NEGOTIATORS HAD NO POWER TO DO OTHERWISE AND THAT THEIR AGENCIES HAD NO SUCH POWER AND HAD NO AUTHORITY OVER THE DETERMINATION OF IMPORT DUTIES," AMOUNTED TO A MISREPRESENTATION. THE NEGOTIATORS, AND THE AGENCIES THEY REPRESENTED, WERE BOUND BY THE MUNITIONS BOARD DIRECTIVE THAT DUTY SHOULD BE DEDUCTED FROM THE DOMESTIC MARKET PRICE, AND THEY CARRIED OUT THAT DIRECTIVE IN THE NEGOTIATIONS.

FURTHER, ASSUMING, ARGUENDO THAT THE BRAZILIAN NEGOTIATORS ACCEPTED THE PRICE OF 77 CENTS PER KILO IN RELIANCE UPON THE REPRESENTATION THAT THE APPLICABLE RATE OF DUTY HAD BY LAW TO BE TAKEN INTO CONSIDERATION IN ESTABLISHING THE PRICE AND THAT THE UNITED STATES OF AMERICA NEGOTIATORS HAD NO POWER TO DO OTHERWISE; ALSO, ASSUMING ARGUENDO THAT THIS WAS NOT A CORRECT REPRESENTATION, THE GENERAL AND WELL-ACCEPTED RULE IS THAT REFORMATION IS NOT A PROPER REMEDY FOR THE ENFORCEMENT OF TERMS TO WHICH THE PARTIES NEVER ASSENTED AND THAT THE PURPOSE OF THE REMEDY OF REFORMATION IS TO PROVIDE FOR THE CORRECTION OF A WRITTEN DOCUMENT TO CONFORM TO THE AGREEMENT WHICH THE PARTIES ACTUALLY MADE. SEE 3 CORBIN ON CONTRACTS, SECTION 614, ALSO STATING AT PAGE 728:

"IF TWO PARTIES ARE CAUSED TO ENTER INTO A CONTRACT BY REASON OF THEIR COMMON IGNORANCE OR COMMON MISTAKE AS TO SOME FACT, BUT FOR WHICH THEY WOULD NOT HAVE AGREED, THIS MAY BE GROUND FOR RESCISSION, BUT IT IS NOT GROUND FOR REFORMATION. PROOF OF SUCH A MISTAKE AS THIS DOES NOT SHOW THAT THE PARTIES HAVE EVER EXPRESSED ASSENT, ORALLY OR OTHERWISE, TO ANY CONTRACT OTHER THAN THE ONE THAT IS WRITTEN. THAT WRITING TRULY EXPRESSES THE ONLY TERMS ON WHICH THEY HAVE EVER AGREED. IT MAY BE SUBJECT TO RESCISSION FOR MISTAKE; BUT THERE IS NO OTHER AGREEMENT IN ACCORDANCE WITH WHICH IT CAN BE "REFORMED.'"

OUR DECISION, REPORTED IN 41 COMP. GEN. 34, IS AN EXCEPTION TO THE ABOVE STATED RULE BECAUSE THE RECORD IN THAT CASE SHOWED CLEARLY THAT THE PARTIES ESTABLISHED THE CONTRACT PRICE ON THE BASIS OF CERTAIN COST ESTIMATES, INCLUDING A ROYALTY PAYMENT OF 1.75 PERCENT OF A UNIT PRICE OF $5,500. IT SUBSEQUENTLY DEVELOPED THAT BEFORE FINAL PROPOSAL AND AWARD OF THE CONTRACT A COURT OF COMPETENT JURISDICTION HAD ISSUED A JUDGMENT WHICH HAD THE EFFECT OF RELIEVING THE CONTRACTOR OF LIABILITY FOR THE ROYALTY PAYMENT. IN VIEW OF THE SMALL AMOUNT OF THE ROYALTY PAYMENT IN RELATION TO THE UNIT PRICE AGREED TO, 1.75 PERCENT, IT APPEARED REASONABLY CERTAIN THAT IF THE NEGOTIATORS HAD BEEN AWARE OF THE COURT'S DECISION AT THE TIME OF THE NEGOTIATIONS THE CONTRACT PRICE WOULD HAVE BEEN REDUCED BY THE AMOUNT OF THE ROYALTY PAYMENT. IN THE PRESENT CASE THERE IS NO SUCH ASSURANCE. THE DUTY, AS UNDERSTOOD AT THE TIME OF NEGOTIATIONS, WAS 35 PERCENT AD VALOREM. THE RECORD IS CLEAR THAT THE UNITED STATES OF AMERICA NEGOTIATORS HAD INSTRUCTIONS AS TO A MAXIMUM PRICE TO BE AGREED TO AND THAT DUTY WAS TO BE TAKEN INTO ACCOUNT IN THE PRICE NEGOTIATIONS. DURING THE COURSE OF THE NEGOTIATIONS, THE PRICE ADVANCED BY THE UNITED STATES OF AMERICA NEGOTIATORS WENT FROM 60 CENTS PER KILO (INITIAL) TO 77 CENTS PER KILO (FINAL), BOTH FIGURES EXCLUSIVE OF DUTY AND TRANSPORTATION COSTS. THE FILE OF THE UNITED STATES OF AMERICA NEGOTIATORS INDICATES THAT THE PRICE ADVANCED BY THE BRAZILIAN NEGOTIATORS WENT FROM $1.15 (INITIAL) TO 92 CENTS PER KILO, WITH FINAL AGREEMENT OF 77 CENTS PER KILO, SUBJECT TO ADJUSTMENT IN ACCORDANCE WITH ARTICLE VII (B). THE BRAZILIAN PRICE OF $1.15 PER KILO WAS APPARENTLY WITHOUT DEDUCTION OF DUTY AND THE PRICE OF 92 CENTS PER KILO WAS APPARENTLY WITH PARTIAL WAIVER OF DUTY. THE QUESTION OF DUTY PLAYED AN IMPORTANT AND SUBSTANTIAL PART IN THE NEGOTIATIONS WOULD HAVE BEEN ON A DIFFERENT BASIS. IN VIEW OF THIS, AND SINCE IT IS CLEAR THAT, IN ACCORDANCE WITH THE CUSTOM WHICH GENERALLY GOVERNS THE MARKET PLACE, THE NEGOTIATORS FOR THE UNITED STATES OF AMERICA WERE INTERESTED IN PAYING THE LOWEST POSSIBLE PRICE, WHILE THE NEGOTIATORS FOR BRAZIL WERE PROPERLY INSISTING UPON A HIGHER PRICE, WE CANNOT CONCLUDE THAT EVEN IF THE DUTY HAD NOT BEEN CONSIDERED THERE WOULD HAVE BEEN AGREEMENT ON A PRICE OF $1.04 PER KILO.

FOR THE REASONS SET FORTH ABOVE, YOUR CLAIM CANNOT BE ALLOWED ON THE BASIS OF MISREPRESENTATION AND REFORMATION.

THE SECOND BASIS URGED IN BEHALF OF THE CLAIMANT IS THAT THE PRICE PROVISION OF THE CONTRACT SHOULD PROPERLY BE INTERPRETED TO PROVIDE FOR AN ADJUSTMENT OF THE PRICE BASED UPON THE ACTUAL APPLICATION OF A RATE OF DUTY BY THE COLLECTOR OF CUSTOMS ON EACH INDIVIDUAL SHIPMENT. SINCE IN EACH CASE THE COLLECTOR APPLIED A RATE OF DUTY FREE, YOU CONTEND THAT THE ENTIRE AMOUNT OF DUTY TAKEN INTO CONSIDERATION IN ESTABLISHING THE PRICE SHOULD BE PAID.

WITH RESPECT TO THIS CONTENTION, WE CONCLUDED IN OUR DECISION OF JUNE 28, 1962, THAT THE PROPER INTERPRETATION OF THE CLAUSE IS THAT THE RATE OF DUTY TO WHICH WOULD HAVE BEEN APPLIED BUT FOR THE STATUTORY EXEMPTION IS THE RATE TO BE CONSIDERED IN ADJUSTING THE CONTRACT PRICE. THE REASONS FOR OUR CONCLUSION ARE FULLY SET OUT IN OUR DECISION OF JUNE 28, 1962, AND WE FIND NO BASIS UPON RECONSIDERATION FOR ARRIVING AT A DIFFERENT CONCLUSION.

THE ARGUMENTS ADVANCED IN SUPPORT OF YOUR CLAIM HAVE RECEIVED MOST CAREFUL CONSIDERATION BY THIS OFFICE AND, IN OUR OPINION, OUR DECISION OF JUNE 28, 1962, WHICH RESULTED IN AN ADDITIONAL PAYMENT OF $299,863.65 TO THE BRAZILIAN GOVERNMENT REPRESENTS A PROPER AND EQUITABLE ADJUSTMENT OF THIS MATTER.