B-162516, DEC. 20, 1967

B-162516: Dec 20, 1967

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SECRETARY: REFERENCE IS MADE TO LETTER DATED SEPTEMBER 12. THE NORMAL OPERATING SEASON SPECIFIED IN THE CONTRACT WAS MAY 1 TO NOVEMBER 15 OF EACH YEAR AND THE EXPIRATION DATE OF THE CONTRACT WAS DECEMBER 1. 1966 UNLESS THE TERMINATION DATE IS ADJUSTED PURSUANT TO SECTION 5A-2. OR THE CONTRACT PERIOD IS EXTENDED BY THE FOREST SERVICE. IS GIVEN WRITTEN PERMISSION TO DO SO AFTER SUCH DATE. TO MAINTAIN FIRE PRECAUTIONARY MEASURES AND SUCH OTHER OF HIS OBLIGATIONS HEREUNDER WHICH ARE NECESSARY TO PROTECT NATIONAL FOREST INTERESTS. "2. WITHIN FIFTEEN (15) DAYS FROM THE TERMINATION OF AN ABNORMAL INTERRUPTION OF TEN (10) OR MORE OPERATING DAYS IN THE PERFORMANCE OF THIS CONTRACT AFTER OPERATIONS HAVE STARTED AND BEFORE OPERATIONS HAVE CLOSED DURING A NORMAL OPERATING SEASON.

B-162516, DEC. 20, 1967

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER DATED SEPTEMBER 12, 1967, FILE REFERENCE 6540, FROM THE REGIONAL FORESTER, SAN FRANCISCO, CALIFORNIA, FORWARDING A CLAIM OF THE KIMBERLY-CLARK CORPORATION UNDER CONTRACT NO. 14-103, DATED DECEMBER 11, 1963.

UNDER THE TERMS OF THE CONTRACT KIMBERLY AGREED TO CUT AND PAY FOR AN ESTIMATED VOLUME OF 25 MILLION FEET OF LIVE OR RECENTLY DEAD TIMBER AS WELL AS AN UNESTIMATED AMOUNT OF OLDER DEAD TIMBER WITHIN THE FAWN CREEK UNIT, SACRAMENTO WORKING CIRCLE, SHASTA TRINITY, CALIFORNIA, AND TO IMPROVE TO FOREST SERVICE SPECIFICATIONS AS A PAVED, DRAINED, ALL WEATHER ROAD AN EXISTING FOREST SERVICE ROAD NUMBERED 40N30 AND KNOWN AS THE "SOUTH FORK ROAD.' THE NORMAL OPERATING SEASON SPECIFIED IN THE CONTRACT WAS MAY 1 TO NOVEMBER 15 OF EACH YEAR AND THE EXPIRATION DATE OF THE CONTRACT WAS DECEMBER 1, 1966.

SECTION 5A OF THE CONTRACT PROVIDED IN PERTINENT PART AS FOLLOWS:

"1. THE PURCHASER AGREES TO CUT AND REMOVE FROM THE SALE AREA ALL TIMBER INCLUDED IN THIS CONTRACT PRIOR TO DECEMBER 1, 1966 UNLESS THE TERMINATION DATE IS ADJUSTED PURSUANT TO SECTION 5A-2, OR THE CONTRACT PERIOD IS EXTENDED BY THE FOREST SERVICE. ALL OTHER OBLIGATIONS OF THE PURCHASER LIKEWISE SHALL BE DISCHARGED PRIOR TO THE ABOVE DATE, OR ANY ADJUSTMENT OR EXTENSION THEREOF: PROVIDED, THAT IF THE PURCHASER FAILS TO DISCHARGE ALL OF SUCH OBLIGATIONS BY THE DATE STATED ABOVE OR AS ADJUSTED OR EXTENDED, AND IS GIVEN WRITTEN PERMISSION TO DO SO AFTER SUCH DATE, HE SHALL NOT THEREBY BE RELIEVED DURING THE PERIOD OF SUCH PERMISSION OF ANY OBLIGATIONS UNDER THIS CONTRACT TO PREVENT DAMAGE TO IMPROVEMENTS, SOIL AND COVER, TO PREVENT AND SUPPRESS FOREST FIRES, TO MAINTAIN FIRE PRECAUTIONARY MEASURES AND SUCH OTHER OF HIS OBLIGATIONS HEREUNDER WHICH ARE NECESSARY TO PROTECT NATIONAL FOREST INTERESTS.

"2. IF THE PURCHASER, WITHIN FIFTEEN (15) DAYS FROM THE TERMINATION OF AN ABNORMAL INTERRUPTION OF TEN (10) OR MORE OPERATING DAYS IN THE PERFORMANCE OF THIS CONTRACT AFTER OPERATIONS HAVE STARTED AND BEFORE OPERATIONS HAVE CLOSED DURING A NORMAL OPERATING SEASON, BEGINNING ON MAY 1, AND ENDING ON NOVEMBER 15 OF ANY YEAR, WHICH WAS DUE TO CAUSES BEYOND THE CONTROL AND WITHOUT THE FAULT OR NEGLIGENCE OF THE PURCHASER, INCLUDING BUT NOT LIMITED TO, ACTS OF GOD, OR OF THE PUBLIC ENEMY, ACTS OF THE GOVERNMENT, STRIKES, FIRES, AND FLOODS, GIVES WRITTEN NOTICE OF AN ACCEPTABLE REASON FOR THE INTERRUPTION AND THE NUMBER OF OPERATING DAYS LOST, THE FOREST SERVICE SHALL ADJUST THE TERMINATION DATE OF THIS CONTRACT TO INCLUDE AN EQUIVALENT ADDITIONAL NUMBER OF OPERATING DAYS: PROVIDED, THAT THE RATES FOR STUMPAGE AND FOR REQUIRED DEPOSITS IN EFFECT WHEN THE ADJUSTMENT IS MADE SHALL CONTINUE DURING THE ADJUSTED PERIOD UNLESS SUCH RATES ARE INCREASED OR DECREASED THROUGH REDETERMINATION, IF PROVIDED FOR HEREIN.

"3. IF THE CONTRACT PERIOD IS EXTENDED, THE FOREST SERVICE MAY MODIFY THE TERMS OF THIS CONTRACT AND SHALL REDETERMINE THE RATES FOR STUMPAGE AND FOR REQUIRED DEPOSITS AS OF AND EFFECTIVE ON THE DAY FOLLOWING THE ORIGINAL TERMINATION DATE, BUT REDETERMINED RATES FOR EACH SPECIES-PRODUCT SHALL BE NO LOWER THAN THE RATE IN EFFECT IMMEDIATELY PRIOR TO THE EFFECTIVE DATE OF THE EXTENSION OF TIME, UNLESS OTHERWISE SPECIFIED IN THE APPROVAL OF THE EXTENSION. SUCH REDETERMINED RATES SHALL APPLY TO ALL TIMBER SCALED OR RELEASED FOR CUTTING DURING THE EXTENDED PERIOD * * *"

IT APPEARS THAT DURING THE CALENDAR YEAR 1964 KIMBERLY PROSECUTED ITS REQUIRED ROAD IMPROVEMENT ON THE SOUTH FORK ROAD UNTIL, IN DECEMBER 1964, IT HAD REACHED A POINT OF APPROXIMATELY 73-PERCENT COMPLETION. DECEMBER 22, 1964, AND DURING THE DAYS IMMEDIATELY FOLLOWING, ALL OF THE WORK THERETOFORE ACCOMPLISHED BY KIMBERLY AND SUBSTANTIAL PORTIONS OF THE SUBGRADE (THE ROAD EXISTING AT THE DATE OF THE CONTRACT) WERE WASHED OUT AND DESTROYED BY FLOODS. THE ROADBED WAS RESTORED ON AUGUST 19, 1966, OVER 1-1/2 YEARS FROM THE DATE OF ITS DESTRUCTION. IMMEDIATELY THEREAFTER KIMBERLY PERFORMED ITS ROAD BETTERMENT OBLIGATIONS AND THE WORK WAS ACCEPTED BY THE FOREST SERVICE ON OCTOBER 14, 1966. ON AUGUST 31, 1966, KIMBERLY REQUESTED THAT THE CONTRACT TERM BE EXTENDED. ON NOVEMBER 30, 1966, THE CONTRACT WAS EXTENDED BY AGREEMENT TO DECEMBER 1, 1967, WITH PROVISION FOR DEFERRING THE ESTABLISHMENT OF RATES FOR 30 DAYS. KIMBERLY WAS NOTIFIED OF THE REDETERMINED RATES ON DECEMBER 16, 1966. WHEN KIMBERLY LEARNED THAT THE RATES WERE TO BE INCREASED IT REQUESTED AN ADJUSTMENT OF THE CONTRACT UNDER SECTION 5A2 BY A NUMBER OF DAYS EQUAL TO THE NUMBER OF DAYS LOST BY AN ABNORMAL INTERRUPTION TO ITS OPERATIONS UNDER THE CONTRACT, WITHOUT REDETERMINATION OF THE STUMPAGE PRICES PROVIDED FOR IN THE CONTRACT. THE FOREST SERVICE REFUSED ITS REQUEST BECAUSE THE CONTRACT HAD BEEN EXTENDED BY AGREEMENT AND, FURTHER, BECAUSE THE DELAY INVOLVED DID NOT COME WITHIN THE PROVISIONS OF SECTION 5A2 OF THE CONTRACT.

KIMBERLY CONTENDS THAT IT SIGNED THE MODIFICATION AGREEMENT OF NOVEMBER 30, 1966, TO KEEP THE CONTRACT OPEN AND THAT IT BELIEVED ITS REQUEST OF AUGUST 31, 1966, WAS STILL BEING CONSIDERED. KIMBERLY ALSO CONTENDS THAT SECTION 5A2 SHOULD BE CONSTRUED TO MEAN THAT THE INTERRUPTION, AND NOT THE CAUSE OF THE INTERRUPTION, MUST OCCUR DURING THE OPERATING SEASON.

WE AGREE WITH THE CONCLUSION OF THE FOREST SERVICE THAT THE CONTRACT DOES NOT LEGALLY PROVIDE FOR ADJUSTMENT OF THE TERMINATION DATE WITHOUT RATE REDETERMINATION AS A RESULT OF THE DECEMBER 1964 STORMS. IT IS CLEAR THAT, UNDER THE PROVISIONS OF SECTION 5A2 OF THE CONTRACT, THE CONTRACT MAY BE EXTENDED WITHOUT ANY RATE REDETERMINATION ONLY WHEN THE CAUSE OF THE INTERRUPTION TO THE OPERATIONS OCCURS DURING THE OPERATING SEASON. THE INSTANT CASE THE FLOOD OCCURRED IN DECEMBER 1964, A TIME NOT WITHIN THE NORMAL OPERATING SEASON.

ALSO, WE SEE NO LEGAL BASIS FOR SETTING ASIDE OR REFORMING THE NOVEMBER 30, 1966, EXTENSION AGREEMENT TO ELIMINATE THE REQUIREMENT FOR A RATE REDETERMINATION. THE EXTENSION OF THE CONTRACT PERIOD WAS STRICTLY IN ACCORDANCE WITH THE TERMS OF SECTION 5A3 OF THE CONTRACT AND THERE IS NOTHING IN THE RECORD TO INDICATE THAT SUCH AGREEMENT RESULTED FROM A MUTUAL MISTAKE OF THE PARTIES TO THE CONTRACT. THE GENERAL RULE IS THAT A MISTAKE, TO JUSTIFY THE REFORMATION OF AN INSTRUMENT, MUST HAVE BEEN MADE IN DRAWING THE INSTRUMENT AND NOT IN MAKING THE CONTRACT OUT OF WHICH IT GREW. THAT IS, IT MUST OCCUR IN REDUCING TO WRITING THE CONTRACT UPON WHICH THE PARTIES HAD AGREED. SEE 26 COMP. GEN. 654 AND COURT CASES CITED THEREIN. SINCE, AS STATED ABOVE, THE CONTRACTING OFFICER WAS OF THE OPINION THAT KIMBERLY WAS NOT ENTITLED TO AN ADJUSTMENT IN THE TERMINATION DATE OF THE CONTRACT UNDER SECTION 5A2, IT SEEMS APPARENT THAT THE NOVEMBER 30 AMENDMENT EXPRESSED HIS INTENTION AND THAT THERE WAS NO ERROR ON HIS PART IN EXECUTING THE AMENDMENT WITH A PROVISION THEREIN FOR THE REDETERMINATION OF THE STUMPAGE RATES. CONSEQUENTLY, IT APPEARS THAT ANY ERROR AS MAY HAVE BEEN MADE IN EXECUTING THE AMENDMENT WAS UNILATERAL ON THE PART OF KIMBERLY AND THEREFORE DOES NOT ENTITLE THE CORPORATION TO RELIEF.

ACCORDINGLY, THERE APPEARS NO LEGAL BASIS FOR MODIFYING THE CONTRACT SO AS TO AUTHORIZE THE DELAY OF THE EFFECTIVE DATE OF THE RATE DETERMINATION BY THE NUMBER OF OPERATING DAYS LOST DUE TO THE DESTRUCTION OF THE FOREST SERVICE ROAD BY THE HEAVY STORMS OF DECEMBER 1964.

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