B-163637, JUN. 3, 1968

B-163637, JUN. 3, 1968

TO TWIN HARBORS LUMBER COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTERS OF FEBRUARY 21 AND 28, 1968, REQUESTING RELIEF UNDER THE MERITORIOUS CLAIMS STATUTE OF APRIL 10, 1928, 31 U.S.C. 236, FOR LOSSES SUSTAINED UNDER DEPARTMENT OF THE INTERIOR, BUREAU OF LAND MANAGEMENT (BLM), TIMBER SALE CONTRACT NO. 14 11-0001-/17/- 46. YOU REQUEST OUR OFFICE TO PROPOSE LEGISLATION WHICH WOULD AUTHORIZE THE PAYMENT TO YOUR COMPANY OF $35,330.99 AS REIMBURSEMENT FOR LOSSES SUSTAINED UNDER THE CONTRACT RESULTING FROM AN ALLEGED ERROR BY BLM IN ESTIMATING THE VOLUME OF TIMBER AVAILABLE FOR CUTTING. IT IS YOUR VIEW THAT THE RELIEF SOUGHT IS SIMILAR TO THAT GRANTED IN THE ELLIS TIMBER COMPANY CASE (PRIVATE LAW 86-1).

BLM REPORTS THAT A CRUISE OF THE SALE AREA TOOK PLACE IN NOVEMBER AND DECEMBER 1963. A TOTAL OF 127 ACRES WAS CRUISED AND MARKED ON A 100 PERCENT BASIS. BASIC MEASUREMENTS DETERMINED WERE DIAMETER BREAST HEIGHT OUTSIDE BARK (DBHOB) AND HEIGHT IN LOGS OF EACH TREE. AN AVERAGE FORM CLASS WAS DETERMINED BY SAMPLING TECHNIQUES AND VOLUME DETERMINATIONS WERE COMPUTED BY MACHINE PROCESSING UNDER THE SCRIBNER LOG RULE IN 16-FOOT LOGS. THE FOLLOWING VOLUME ESTIMATES RESULTED:

STANDING GROSS VOLUME MARKED 9,083 MBF

GROSS MERCHANTABLE VOLUME 7,053 MBF

VOLUME IN CULL LOGS 2,030 MBF

NET MERCHANTABLE VOLUME 6,349 MBF

MBF (THOUSAND BOARD FEET) AS THE STAND WAS MARKED AND CRUISED A REPRESENTATIVE SAMPLE WAS GRADED AND UNMERCHANTABLE MATERIAL WAS ESTIMATED IN TWO CATEGORIES, I.E. (A) TOTAL CULL LOGS OR TREES AND (B) PARTIAL CULL IN LOGS DUE TO DEFECT AND BREAKAGE. RESULTS OF THE GRADE SAMPLING AND ANALYSIS WERE APPLIED TO THE VOLUME FIGURES TO DERIVE THE FOLLOWING ESTIMATES BY LOG GRADE:

NO. 1 PEELER - 72,692 BF 1 PERCENT

NO. 2 PEELER - 455,263 BF 7 PERCENT

NO. 3 PEELER - 495,978 BF 8 PERCENT

NO. 2 SAWLOGS - 1,590,715 BF 25 PERCENT

NO. 3 SAWLOGS - 3,734,663 BF 59 PERCENT

TOTAL NET VOLUME - 6,349,311 BF 100 PERCENT

(NOTE: 5 MBF UNGRADED MATERIAL WAS ADDED AFTER

SALE WAS CONSUMMATED.) WITH REFERENCE TO THE NOTICE OF SALE, BLM HAS ADVISED THAT:

THE TIMBER VOLUME ESTIMATES WERE DERIVED FROM INDIVIDUAL TREE MEASUREMENTS USING FORM CLASS VOLUME TABLES AS BASED ON THE SCRIBNER DECIMAL C LOG RULE FOR 16-FOOT LOGS. THE VOLUME OF THE AVERAGE TREE WOULD BE APPROXIMATELY 13.2 PERCENT LESS IF THE SCRIBNER DECIMAL C LOG RULE FOR 32-FOOT LOGS WERE TO BE USED. A TOTAL OF APPROXIMATELY 1,043 TREES WHICH ARE CONSIDERED TO BE NONMERCHANTABLE ARE DESIGNATED FOR CUTTING. WITH RESPECT TO MERCHANTABLE TREES OF ALL SPECIES THE AVERAGE TREE IS 40 INCHES DBHOB; THE AVERAGE LOG CONTAINS 389 BOARD FEET. THE TOTAL GROSS VOLUME IS APPROXIMATELY 9,083 MBF; AND 70 PERCENT RECOVERY IS EXPECTED. THE SALE VOLUME IS ESTIMATED ON THE BASIS OF A 100 PERCENT CRUISE WITH THE UNDERSTANDING THAT THE PURCHASER IS LIABLE FOR THE TOTAL PURCHASE PRICE EVEN THOUGH THE QUANTITY OF TIMBER SEVERED OR REMOVED IS LESS THAN THE ESTIMATED VOLUME SHOWN ABOVE.

THE TOTAL APPRAISED VALUE WAS $18.40 PER MBF OR A TOTAL OF $116,821.60, BUT AS A RESULT OF THE AUCTION, THE TIMBER (6,349 MBF)WAS SOLD TO YOUR COMPANY FOR $28.50 PER MBF FOR A TOTAL OF $180,946.50. YOU STATE THAT BECAUSE OF BAD WEATHER AND ACCESS PROBLEMS DURING THE PERIOD FROM FEBRUARY 14, 1964, TO THE DATE OF THE CONTRACT, MARCH 9, 1964, AS WELL AS COINCIDENT OFFERINGS OF NATIONAL FOREST TIMBER THAT HAD TO BE EXAMINED, YOUR COMPANY WAS NOT ABLE TO CAREFULLY CHECK BLM'S ESTIMATES OF TIMBER VOLUME IN THE SHORT TIME AVAILABLE TO IT.

THE NATURE OF YOUR CLAIM AGAINST THE GOVERNMENT IS THAT THE ACTUAL VOLUME OF TIMBER CUT WAS ABOUT 1,239,684 BOARD FEET LESS THAN THE TOTAL VOLUME ESTIMATED BY BLM. IN YOUR LETTER OF FEBRUARY 21, 1968, YOU STATE THAT:

"WE RECOGNIZE THAT THE TIMBER CONTRACT IS WRITTEN IN SUCH A FASHION THAT WE WOULD HAVE DIFFICULTY IN SEEKING COURT RECOVERY FOR OUR LOSS DUE TO THE ERROR OF THE BUREAU OF LAND MANAGEMENT. HOWEVER, WE DO NOT BELIEVE THAT IT IS THE INTENT OF THE UNITED STATES GOVERNMENT TO MAKE SUCH GROSSLY ERRONEOUS REPRESENTATIONS AS ARE EVIDENT IN THIS CASE AND TO TAKE ADVANTAGE OF THE CONTRACT LANGUAGE TO REQUIRE A TIMBER PURCHASER TO PAY FOR TIMBER HE DID NOT RECEIVE. * * *"

SECTION 3 OF THE CONTRACT PROVIDED THAT THE PURCHASER SHALL BE LIABLE FOR THE TOTAL CONTRACT PURCHASE PRICE EVEN THOUGH THE QUANTITY OF TIMBER MAY BE MORE OR LESS THAN THE ESTIMATED QUANTITY. THUS, THE GOVERNMENT WAS UNDER NO LEGAL OBLIGATION TO REIMBURSE YOUR COMPANY FOR CONTRACT LOSSES EVEN IF THEY RESULTED FROM AN UNDER-ESTIMATE OF VOLUME BY BLM. THE COURTS HAVE HELD THAT A PURCHASER HAS NO STANDING TO COMPLAIN THAT GOODS ARE DEFICIENT IN QUANTITY WHEN THE SALES CONTRACT SPECIFICALLY WAS TENDERED ON AN "ESTIMATED" QUANTITY BASIS. BRAWLEY V UNITED STATES, 96 U.S. 168; PINE RIVER LOGGING CO. V UNITED STATES, 186 U.S. 279. IN THOSE CASES, THE COURTS HELD THAT ALL THAT WAS REQUIRED OF THE PARTY MAKING THE ESTIMATE WAS THAT IT SHOULD BE MADE IN GOOD FAITH WITHOUT GROSS DISREGARD OF THE FACTS.

ON THE BASIS OF YOUR REPRESENTATIONS, YOU REQUEST OUR OFFICE TO PROPOSE LEGISLATION ON YOUR BEHALF AS A MATTER OF EQUITY AND IN ACCORDANCE WITH OUR ACTIONS TAKEN WITH RESPECT TO THE ELLIS CASE. UNDER THE PROVISIONS OF THE ACT OF APRIL 10, 1928, 31 U.S.C. 236, OUR OFFICE IS AUTHORIZED TO SUBMIT A REPORT AND RECOMMENDATION TO THE CONGRESS ON ANY CLAIM AGAINST THE UNITED STATES NOT SUBJECT TO LAWFUL ADJUSTMENT BY THE USE OF AN APPROPRIATION THERETOFORE MADE BUT CONTAINING IN OUR JUDGMENT SUCH ELEMENTS OF LEGAL LIABILITY OR EQUITY AS TO BE DESERVING OF THE CONSIDERATION OF THE CONGRESS. IN THE ELLIS TIMBER COMPANY CASE, THE GOVERNMENT'S ESTIMATE OF THE AMOUNT OF TIMBER CONTAINED IN THE SALE AREA WAS GROSSLY ERRONEOUS. AT THE COMPLETION OF CUTTING OPERATIONS, ONLY ABOUT 20 PERCENT OF THE ESTIMATED QUANTITY OF TIMBER WAS LOGGED AND RECOVERED BY ELLIS. OUR OFFICE SUBMITTED A REPORT TO THE CONGRESS ON ELLIS' CLAIM FOR RECOVERY OF HEAVY LOSSES OCCASIONED BY HIS PERFORMING THE CONTRACT FOR THE FOLLOWING REASONS. THE RECORD ESTABLISHED THAT THE CONTRACT CONTAINED THE LARGEST PERCENTAGE OF ERROR EVER MADE AT THAT TIME IN THE GOVERNMENT'S ESTIMATE OF VOLUME OF TIMBER TO BE SOLD BY THE BLM; THAT NORMALLY A VERY SMALL PERCENTAGE OF ERROR MAY BE EXPECTED IN SUCH AN ESTIMATE; THAT DESPITE THE MAGNITUDE OF THE TIMBER UNDERRUN, ELLIS DILIGENTLY PERFORMED THE CONTRACT OPERATIONS TO COMPLETION; AND THAT ELLIS' FELLING OF UNMERCHANTABLE SNAGS WHILE PERFORMING THE CONTRACT OPERATIONS RESULTED IN MATERIAL BENEFITS OF SUBSTANTIAL VALUE TO THE GOVERNMENT.

BLM HAS RECOMMENDED THAT YOUR CLAIM FOR RELIEF UNDER THE MERITORIOUS CLAIMS STATUTE BE DENIED ON THE BASIS OF THE RECORD AS SET OUT BELOW.

IT IS REPORTED THAT LOGGING STARTED IN JUNE 1964 AND THE FIRST INSPECTION REPORT IS DATED JUNE 23, 1964. TWIN HARBORS SUBCONTRACTED CUTTING AND REMOVAL OF THE TIMBER TO ROUSE BROS. LOGGING COMPANY. BLM FILES DO NOT INDICATE WHAT CONTROLS, IF ANY, WERE ESTABLISHED TO ASSURE THAT ALL MATERIAL REMOVED WAS ADEQUATELY ACCOUNTED FOR. LOGGING WAS SHUT DOWN OCTOBER 15, 1964, FOR WINTER WEATHER AND ROAD CONDITIONS. AT THAT TIME AN INSPECTION REPORT SHOWS THAT 99.5 ACRES WERE CUT OVER WITH AN ESTIMATED NET VOLUME OF 4,681 MBF. AT THIS TIME 5 MBF ADDITIONAL TIMBER WERE MARKED AND SUBSEQUENTLY ADDED TO THE CONTRACT BY A MODIFICATION.

THERE WAS NO CUTTING REPORTED DURING THE SUMMER OF 1965 AND THE NEXT ACTION IS REPORTED ON SEPTEMBER 8, 1965. TWIN HARBORS REPORTED THAT JOHN ROUSE WAS KILLED ON SEPTEMBER 7, 1965, ON ANOTHER OPERATION AND REQUESTED AN EXTENSION OF TIME ON THIS CONTRACT. THE VERBAL REQUEST FOR EXTENSION WAS CONFIRMED IN WRITING BY LETTER DATED SEPTEMBER 17, 1965, CITING AS REASONS: 1. FLOOD DAMAGE TO ROADS IN DECEMBER 1964. 2. SOUND LUMBER CO., MANUFACTURING SUBSIDIARY MILL, BURNED OUT ON MAY 24, 1965. 3. PARTNER OF LOGGING CONTRACTOR KILLED.

LOGGING OPERATIONS WERE CARRIED OUT BETWEEN SEPTEMBER 8, 1965, AND OCTOBER 28, 1965, WHEN SHUT DOWN FOR WINTER WEATHER CONDITIONS BECAME NECESSARY. BY OCTOBER 28, 1965, SOME 114.5 ACRES HAD BEEN CUT OVER WITH AN ESTIMATED NET VOLUME OF 5,628 MBF CUT. MOST OF THE TIMBER CUT DURING THIS PERIOD WAS REPORTEDLY SOLD ON THE OPEN MARKET BUT BLM HAS NO INFORMATION CONCERNING WHAT CONTROLS, IF ANY, WERE ESTABLISHED TO ASSURE THAT ALL MATERIAL REMOVED OR SOLD WAS PROPERLY ACCOUNTED FOR.

THE REQUEST FOR EXTENSION OF TIME WAS REPEATED IN A LETTER OF FEBRUARY 8, 1966, AND A 6-MONTH EXTENSION WAS GRANTED IN DUE ORDER AFTER FULL PAYMENT OF THE BALANCE DUE AS REQUIRED BY TERMS OF THE CONTRACT.

THE FIRST COMPLAINT OF AN UNDERCUT AROSE ON MARCH 28, 1966, IN A LETTER FROM MR. GEORGE CRAIG, SECRETARY-MANAGER, WESTERN LUMBER MANUFACTURERS, INC. TWIN HARBORS NEVER FILED ANY SUCH COMPLAINT WITH BLM. MR. GEORGE CRAIG FOLLOWED UP WITH MORE DETAIL IN A LETTER OF APRIL 1, 1966, WHEREIN HE STATED:

"TO DATE, THE PURCHASER HAS REMOVED 3,693,000 FT., NET SCALE, A GROSS VOLUME OF 4,439,440 FT. IT IS ESTIMATED THAT THERE REMAINS 350 M FT. NET SCALE.'

PRELIMINARY INVESTIGATIONS BY BLM AND A CHECK WITH COMPANY OFFICIALS FOLLOWED. IMMEDIATELY FOLLOWING THE GRANTING OF THE 6-MONTH EXTENSION OF TIME UNDER THE CONTRACT TWIN HARBORS WAS INFORMED THAT THERE WAS AT LEAST 700,000 BOARD FEET UNCUT AND FURTHERMORE THAT A CONSIDERABLE VOLUME OF NO. 3 SAWLOGS HAD BEEN LEFT IN THE WOODS DURING PRIOR OPERATIONS. NO FURTHER ACTION WAS NOTED ON THE SALE AREA UNTIL AUGUST 1966, WHEN TWIN HARBORS STARTED OPERATIONS AGAINST THE SALE AREA. ON JULY 18, 1966, A VERBAL WARNING WAS ISSUED THAT YOUR COMPANY WOULD HAVE TO FINISH THE OPERATION BY THE FIRST OF NOVEMBER. THIS WAS CONFIRMED IN WRITING ON SEPTEMBER 16, 1966, SETTING THE EXACT DATE FOR COMPLETION AT NOVEMBER 6, 1966.

IT IS REPORTED THAT ON OCTOBER 26, 1966, AN INSPECTION REPORT INDICATED THAT CUTTING WAS COMPLETED AND NO REQUEST FOR FURTHER EXTENSION HAVING BEEN RECEIVED, THE DISTRICT MANAGER NOTIFIED TWIN HARBORS ON NOVEMBER 10, 1966, BY LETTER THAT THE SALE WAS COMPLETED AND THE CONTRACT WOULD BE TERMINATED UPON RECEIPT OF CERTAIN REPORTS. A RELINQUISHMENT SIGNED BY G. E. ANDERSON, VICE-PRESIDENT OF TWIN HARBORS DATED DECEMBER 5, 1966, WAS RECEIVED AND THE CONTRACT WAS TERMINATED BY A NOTICE SIGNED AND DATED DECEMBER 28, 1966. A LOG SCALE REPORT, DATED DECEMBER 1, 1966, FILED BY TWIN HARBORS SHOWS A NET VOLUME OF 4,220,260 FT. SCALED BY "COMPANY EMPLOYEE" AND ,SCALING BUREAU.' THIS REPORT INDICATES THAT THE SCRIBNER LOG RULE SCALE WAS USED AND LOGS UP THROUGH 40 FT. IN LENGTH WERE MEASURED WITHOUT TAPER. AN UNREPORTED TAPER ALLOWANCE WAS INDICATED FOR LOGS 42- FOOT LONG AND OVER. A LETTER DATED DECEMBER 6, 1966, WAS DIRECTED TO GEORGE CRAIG BY ROBERT BARRETT OF TWIN HARBORS AND REFERRED TO BLM BY GEORGE CRAIG. IN THIS LETTER ROBERT BARRETT STATES, IN BRIEF, THAT:

1. THEY BID AND PAID FOR 6,354,000 BOARD FEET.

2. GROSS VOLUME REMOVED WAS 5,169,080 BOARD FEET, SOME 18.6 PERCENT UNDER BLM.

3. NET VOLUME REMOVED WAS 4,220,260 BOARD FEET, SOME 33.6 PERCENT UNDER BLM NET. IN A LETTER DATED JANUARY 10, 1967, SIGNED BY E. J. PETERSEN AS ACTING STATE DIRECTOR, BLM NOTIFIED GEORGE CRAIG THAT:

1. THE PRIMARY DIFFERENCE INVOLVES SCALING METHODS.

2. BETWEEN 700,000 AND 1,000,000 FT. OF LOW VALUE LOGS WERE LEFT ON THE GROUND.

3. THE ORIGINAL ESTIMATE OF VOLUME BY BLM WAS QUITE ACCURATE. SUBSEQUENTLY, BLM ENTERED INTO A CONTRACT WITH CARLOTTA LUMBER CO. FOR SALVAGE RIGHTS ON THE SALE AREA. CARLOTTA INSPECTED THE AREA IN ADVANCE AND PAID $7,500 FOR AN ESTIMATED VOLUME OF 750,000 BOARD FEET IN SALVAGE LOGS. PRIOR TO THE SHUT DOWN WITH WINTER WEATHER IN THE FALL OF 1967 CARLOTTA REMOVED 660,730 BOARD FEET, GROSS VOLUME BY LONG LOG SCALE, IN SALVAGE LOGS. THEY REPORTED RECOVERY AS FOLLOWS IN SCRIBNER LONG LOG SCALE:

231,508 BOARD FEET GRADED LUMBER

104,742 BOARD FEET CULL PEELERS AND CHIPS

336,250 BOARD FEET NET. (51 PERCENT) FURTHER CORRESPONDENCE AND CONFERENCES ENSUED, PRIMARILY BETWEEN GEORGE CRAIG AND BLM REPRESENTATIVES. THIS WAS CULMINATED AT A CONFERENCE IN ARCATA ON FEBRUARY 1, 1968.

AT THE END OF THE FEBRUARY 1 CONFERENCE, MR. CRAIG AND COMPANY OFFICIALS APPEARED CONVINCED THAT ADMINISTRATIVE ACTION OR APPEAL TO THE DIRECTOR OR SECRETARY OF INTERIOR WOULD BE FRUITLESS AND THAT CIVIL SUIT IN COURT WOULD NOT BE LIKELY OF SUCCESS. THE DECISION IN THE CASE OF RUSSELL AND PUGH LUMBER CO. VS UNITED STATES, 290 F.2D 938, 941-942 WAS CITED AND DISCUSSED AT LENGTH. A COPY WAS PRESENTED TO COMPANY OFFICIALS FOR FURTHER STUDY. GEORGE CRAIG THEN PROPOSED ACTION VIA PRIVATE BILL THROUGH CONGRESS. AN ANALYSIS MADE IN THE OFFICE BY FORESTERS EUGENE DROWN AND CHARLES HAYHURST FOR BLM BASED ON VARIOUS REPORTS AND STATEMENTS SUBMITTED BY TWIN HARBORS REVEALS NUMEROUS VARIATIONS IN YOUR COMPUTATIONS AND MISAPPLICATION OF CONVERSION FACTORS IN ATTEMPTING TO RELATE YOUR LONG LOG SCALE TO THE BLM 16-FOOT LOG SYSTEM. IT IS IMPORTANT TO NOTE THAT ALL SCALING REPORTS SUBMITTED TO BLM SHOW THAT NO TAPER WAS ALLOWED ON LOGS UP TO AND INCLUDING 40 FT. IN LENGTH. THE ENTIRE SALE AREA WAS LOGGED BY SUBCONTRACTORS AND MUCH OF THE VOLUME REMOVED WAS SOLD TO OTHER MILLS. CONTROLS, IF ANY, ESTABLISHED BY TWIN HARBORS, TO ASSURE PROPER SCALING AND ACCOUNTING FOR ALL MATERIAL REMOVED ARE NOT APPARENT AND BLM HAS ASSUMED NO RESPONSIBILITY FOR VERIFICATION OF THE SCALING RECORDS. HOWEVER, AT THIS TIME, ACCEPTING REPORTS AND STATEMENTS FROM TWIN HARBORS AND CARLOTTA LUMBER CO. AT FACE VALUE AND USING AVERAGE TREE MEASUREMENTS TO DETERMINE THE INDICATED VARIATION IN SCALING METHODS BLM OFFICIALS HAVE DETERMINED THAT ACTUAL RECOVERY REPORTED IS APPROXIMATELY 6,055,337 BOARD FEET WHEN CONVERTED TO SCRIBNER RULE IN 16-FOOT LOGS. THIS IS 95.3 PERCENT OF THE ORIGINAL BLM ESTIMATE. AT THE END OF CARLOTTA'S SALVAGE OPERATION BLM FORESTERS ESTIMATED THAT APPROXIMATELY 250,000 BOARD FEST OF MERCHANTABLE MATERIAL IN LOW VALUE LOGS STILL REMAINED IN THE WOODS. HOWEVER, IT IS WIDELY SCATTERED, MIXED WITH CULL LOGS, AND AFTER LAYING OVER THE WINTER OF 1967-68 IS NOW ESSENTIALLY UNSALVAGEABLE FROM THE ECONOMIC VIEWPOINT.

ACCORDING TO BLM COMPUTATION OF THE INDICATED RECOVERY VOLUME, THE AVERAGE TREE OF 40 INCHES DEHOB WITH 5 PLUS MERCHANTABLE LOGS AND FORM CLASS 78 CONTAINS A GROSS VOLUME OF 2310 BOARD FEET. IF CUT INTO 2 LOGS, 40-FOOT TO 48-FOOT IN LENGTH, AS WAS THE PRACTICE, AND SCALED WITHOUT TAPER ALLOWANCE AS REPORTED THE RESULT WOULD BE A GROSS SCALE OF 1770 BOARD FEET. THEREFORE, THE GROSS 16-FOOT LOG SCALE IS 2310/1770, OR 130.5 PERCENT OF THE GROSS LONG LOG SCALE. THIS FACTOR SHOULD BE APPLIED TO THE GROSS LOG SCALE BEFORE THE DEFECT DEDUCTION IS MADE TO DETERMINE NET VOLUME. A MAJOR ERROR MADE BY TWIN HARBORS IS THE APPLICATION OF AN ADJUSTMENT FACTOR TO THE NET VOLUME AND THE APPLICATION OF THE ADJUSTMENT FACTOR FOR 32-FOOT LOGS TO THE SCALE OF 40-FOOT LOGS. BLM CAN, HOWEVER, ASSUME THAT SOME SHORT LOGS WERE INCLUDED, AS YOU CONTEND.

ON THE BASIS OF THE ANALYSIS MADE BY BLM IT APPEARS THAT THE ORIGINAL CRUISE BY BUREAU FORESTERS WAS A VERY ACCURATE ESTIMATE (WITHIN 5 PERCENT) AND THE MAJOR REASONS FOR THE ALLEGED SHORTAGE BY TWIN HARBORS ARE TWO PROBLEMS IN YOUR OWN OPERATION.

1. USE OF A LONG LOG SCALING METHOD WITHOUT CONSIDERATION OF THE ACTUAL MILL RECOVERY.

2. POOR UTILIZATION STANDARDS AS YOU LEFT MUCH LOW VALUE MATERIAL IN THE WOODS (NO. 3 SAWLOGS).

FOR THE REASONS STATED ABOVE AND FROM THE RECORD BEFORE US, IT IS OUR VIEW THAT YOUR CLAIM REFLECTS NEITHER LEGAL LIABILITY NOR EQUITY AND, THEREFORE, WE MUST DENY YOUR REQUEST FOR EQUITABLE RELIEF UNDER THE ACT OF APRIL 10, 1928, 31 U.S.C. 236.