Opinion ID: 511875
Heading Depth: 2
Heading Rank: 2

Heading: Method Used by USFS to Redetermine Timber Rates

Text: 11
12 The Claims Court held that the USFS used the correct methods to redetermine and implement timber rates under Cedar's extended contract. Specifically, the court approved of the USFS' choice of February 15, 1981 (45 days before the original termination date of the contract) as the date from which the appraisal data in effect would be selected, and its choice of January 1, 1986 as the date on which the redetermined rates would go into effect. On the latter point, the court noted that the USFS could have selected an even earlier date, September 4, 1984 (the adjusted termination date of the contract) as the date on which to put the redetermined rates into effect. Instead, USFS chose to be lenient. 13 Cedar challenges that ruling by urging on this court a reading of the relevant contract terms and governing regulations that would, if accepted, create a needless disharmony among them. The relevant documents that compose the parties' obligations (original contract, MSEP extension agreement, the settlement agreement, and the MSEP policy statements) almost uniformly concur that any rate reappraisal under an extended contract shall be made using appraisal data in effect 45 days prior to the original termination date. 14 Cedar seizes upon seemingly contrary language in the USFS' December 7, 1983 commentary to the MSEP policy. Although condition 3 of the USFS' August 1983 interim MSEP policy statement stated that [t]he timber covered by the extension will be reappraised under terms set forth in the initial contract to extablish [sic] rates applicable during the extension period, 48 Fed.Reg. 38,862, 38,863-64 (1983), the USFS' December 1983 commentary, explaining that condition in its final adoption of the MSEP policy, appears, at first glance, to set a different timetable. That commentary reads, in part: Therefore, in conformance with the original contract precepts, the extended timber will be reappraised. In accordance with current practice, the reappraisal will use data in effect 45 days before the effective date of the extension. Id. at 54,816 (emphasis added). 15 However, this apparent conflict disappears when one examines the context surrounding the commentary. As the Claims Court opinion noted, the USFS, in its commentary, was responding to requests from timber companies that the USFS grant them CTAs, instead of conducting a rate reappraisal. In rejecting that request, the USFS refers to the effective date of the extension instead of the original termination date. The significance of this difference diminishes when one considers that in contract extensions in which no CTAs have been granted, the effective date of the extension will be the same day as the original termination date. Since the USFS did grant CTAs to Cedar, the portion of the commentary (discussing contract extensions in which no CTAs have been granted) to which Cedar directs our attention does not apply to Cedar's situation. 16 Furthermore, we agree with the Claims Court that were it necessary to choose between the language in the August 1983 MSEP policy statement and the December 1983 commentary to that policy, we would consider the former to be the more authoritative. Therefore, we hold that the USFS correctly selected February 15, 1981 (45 days prior to the original termination date) as the operative date from which to select rate reappraisal data. 17
18 As we noted above, the Claims Court determined that the correct date for implementation of the reappraised rates was the adjusted termination date of the contract, September 4, 1984. The USFS' choice of January 1, 1986 as the effective date of the new rates worked no disadvantage to Cedar because it only postponed implementation of higher rates. In practical effect, this delay meant little since it appears that Cedar harvested no timber under this contract between those two dates. 19 Cedar does not complain about this difference. Rather, it argues that the effective date of the reappraised rates should have been much later because Interim Directive No. 105, Forest Service Manual p 2433.12a(5)(b)(2)(o), provides that earned CTAs be tacked on to the original contract termination date to determine the effective date for the new, higher rates. However, the Claims Court found that Cedar could not avail itself of this provision. Even though it may have had up to 96 earned but unused CTA days remaining as of September 4, 1984, the court found that Cedar had offered no plausible justification for its failure to use those days before the adjusted termination date of the original contract. Cedar's only explanation was that it was unable to harvest timber while an injunction issued in North Side, halting logging after the end of the 1982 season, was in effect. 20 As the Claims Court noted, this explanation amounts to a suggestion that Cedar should have been entitled to additional CTAs beyond the September 4, 1984 adjusted termination date because of the injunction. However, this potential entitlement is defeated by the very words of one of the contract terms setting out the conditions for additional CTAs. That term reads as follows: 21 (a) Purchaser experiences delay in starting scheduled operations or interruption in active operations ... for 10 or more consecutive calendar days during a Normal Operating Season due to causes beyond Purchaser's control, including but not limited to acts of God, acts of the public enemy, acts of Government, labor disputes, fires, insurrections or floods. 22 p B8.21(a) (emphasis added). Not only did the injunction in North Side run against the Government, but the plaintiff class (including Cedar) was the party that obtained the injunction. As such, Cedar cannot claim that a cause beyond its control prevented it from logging. We agree with the Claims Court that Cedar had no entitlement to outstanding CTAs that would have prevented the USFS from making the reappraised rates effective on January 1, 1986, or even on the earlier adjusted termination date of the original contract, September 4, 1984. 23