Government Accurately Estimated Available Timber

A claim seeking an equitable adjustment or breach of contract damages was denied by the Civilian Board of Contract Appeals because the timber sale contract accurately represented the volume of timber available for removal. The dispute arose when the estimated volume of timber in the fixed-price contract proved to be greater than the actual volume of timber harvested by the contractor. Alleging the timber estimate in the contract was inaccurate, the contractor sought an equitable adjustment pursuant to the contract's Adjustment for Quantity Error clause. Alternatively, the contractor claimed breach of contract and breach of the duty of fair dealing based on the government's failure to comply with estimating procedures contained in a government handbook. The contractor also claimed the government was negligent in its preparation of the estimated timber volume and sought reformation of the contract on the basis of mutual mistake regarding the available timber quantity.

However, the record showed the government's estimate was based on sound methodology that accurately quantified the available timber. The government's failure to follow the handbook procedures was not a breach of the contract, because the contract did not represent that the government would follow the handbook in calculating the estimate, and compliance with the handbook was not mandated by statute or regulation. Furthermore, the government's estimate did not contain errors subject to correction under the Adjustment for Quantity Error clause, and its chosen methodology did not constitute negligence or a breach of duty. The contract contained disclaimers that explicitly stated the estimate was not a guarantee, and they provided no adjustments would be made for variations in accuracy. Although these types of disclaimers do not insulate the government from liability for "grossly erroneous or negligently prepared" estimates, the record showed the government used a reasonable methodology that was free of erroneous measurements, calculations, or data input errors. In contrast, the evidence revealed fundamental errors in the contractor's competing calculations. (Carr Forest Products, Inc. v. Dept. of Agriculture, CBCA, ¶92,317)

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