# THIS OPINION WAS INITIALLY ISSUED UNDER PROTECTIVE

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## Record

- **Collection:** Agency decision
- **Document type:** Agency decision

## Text

THIS OPINION WAS INITIALLY ISSUED UNDER PROTECTIVE
ORDER AND IS BEING RELEASED TO THE PUBLIC
IN ITS ENTIRETY ON MARCH 23, 2020
DENIED: March 9, 2020

CBCA 5863

FUTURE FOREST, LLC,
Appellant,
v.
DEPARTMENT OF AGRICULTURE,
Respondent.
Alan I. Saltman, Jacob W. Scott, and Alexander Gorelik of Smith, Currie & Hancock
LLP, Washington, DC, counsel for Appellant.
Lori Polin Jones, Office of the General Counsel, Department of Agriculture,
Washington, DC; and Andrew Moore, Office of the General Counsel, Department of
Agriculture, Albuquerque, NM, counsel for Respondent.
Before Board Judges VERGILIO, SHERIDAN, and ZISCHKAU.
SHERIDAN, Board Judge.
The White Mountain Stewardship contract (WMSC) was an indefinite
delivery/indefinite quantity (ID/IQ) contract under which respondent, United States
Department of Agriculture, Forest Service (Forest Service), agreed to pay appellant, Future
Forest, LLC (Future Forest), to treat and remove small diameter trees and biomass in the
Apache-Sitgreaves National Forest in Arizona. Previously, the Board ruled that the contract
minimum was 5000 acres per year for a total of 50,000 acres over the ten-year term of the

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contract. Future Forest, LLC v. Department of Agriculture, CBCA 5764, 19-1 BCA ¶ 37,238
(2019).1
In this appeal, Future Forest posits that the comments of the Forest Service employees
created a “reasonable expectation” that the agency would provide Future Forest with 150,000
acres, and that the Forest Service violated the implied duty of good faith and fair dealing
when it failed to fulfill Future Forest’s “reasonable expectation.” Future Forest further
alleges that actions of the Forest Service interfered with that duty when 150,000 acres were
not released.
The Forest Service moved for summary judgment and the Board ordered Future Forest
to address only the threshold legal issue presented by the motion—whether the duty of good
faith and fair dealing can be the basis for this claim for acreage amounts beyond the contract
minimum in an ID/IQ contract.
Future Forest does not survive summary judgment because the premise underlying its
theory of relief is unsustainable. There could be no legal “reasonable expectation” to receive
150,000 acres under this ID/IQ contract, as this ID/IQ contract did not create such an
expectation. What Future Forest and certain agency personnel may have anticipated or hoped
for at the time of contract signing or during post-award discussions represents inadmissible
parole evidence. The written language of the contract with the guaranteed minimum dictates
the parameters of reasonable expectations. Future Forest attempts to transform the ID/IQ
contract into something it is not, such as a definite quantity or requirements contract.
Legally, the theory as presented fails such that summary judgment is appropriate and the
appeal is denied.
Background
I.

Contract Terms and Performance

The Forest Service awarded the WMSC to Future Forest in August 2004. Despite the
original pre-award project, in which the Forest Service anticipated releasing approximately
150,000 acres over the ten year contract, at regular intervals of 15,000 acres a year, the

1

By modification 1, the parties authorized the Forest Service to offer task orders
that met the minimum guarantee, either in acres or green tons, whichever was reached first.
A conversion factor was included in modification 1 to derive the equivalency, and the parties
agreed that 53,550 green-tons of material was the equivalent of the 5000 acre minimum
guaranteed in the original contract.

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competed and awarded contract expressly guaranteed a minimum of 5000 acres per year for
a total of 50,000 acres over the ten-year term of the contract. Future Forest, 19-1 BCA at
181,270. The contract described the contract as an ID/IQ contract and stated the guaranteed
amounts:
B.1.0. This schedule describes the type(s) of work the
Contractor may anticipate under the White Mountain
Stewardship Project (WMSP), Indefinite Delivery/Indefinite
Quantity (ID/IQ) contract.
....
Minimum Guarantee: The Government will guarantee a
minimum, for each program year of work, of 5,000 (five
thousand) acres for a total of 50,000 acres over the 10 year
term of the contract of forest land that is in need of landscape
biomass management with approved environmental analysis.
The contract included the clause found at Federal Acquisition Regulation (FAR)
52.216-22, Indefinite Quantity (OCT 1995), which provides:
(a) This is an indefinite-quantity contract for the supplies or
services specified, and effective for the period stated, in the
Schedule. The quantities of supplies and services specified in
the Schedule are estimates only and are not purchased by this
contract.
(b) Delivery or performance shall be made only as authorized
by orders issued in accordance with the Ordering clause. The
Contractor shall furnish to the Government, when and if
ordered, the supplies or services specified in the Schedule up to
and including the quantity designated in the Schedule as the
maximum. The Government shall order at least the quantity of
supplies or services designated in the Schedule as the minimum.
48 CFR 52.216-22 (2019) (FAR 53.216-22).
Approximately one month into the contract, the parties entered into modification 1,
that authorized the Forest Service to offer task orders that met the minimum guarantee, either

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in acres or green tons, whichever was reached first. A conversion factor was included in
modification 1 to derive the equivalency, and the parties agreed that 53,550 green-tons of
material was the equivalent of the 5000 acre minimum guaranteed in the original contract.
2

Between September 2004 and May 2014, the Forest Service issued task orders
releasing 71,737.90 acres, from which Future Forest treated 2,601,846.15 green tons of
material. Future Forest operated the WMSC until the contract expired in August 2014.
II.

Future Forest’s Claims

In September 2015, Future Forest submitted a certified claim to the contracting officer
alleging that in program years eight and ten the Forest Service failed to release the amounts
of acreage required by the WMSC. Future Forest also claimed that it was entitled to
$14,743,430.72 in “lost gross profits” based on the Forest Service’s alleged failure to provide
a total of at least 150,000 acres over the ten-year period of contract performance. Future
Forest appealed the deemed denial of its claim to the Board, where it was docketed as CBCA
5764.
In June 2017, Future Forest submitted its second claim, the one that underlies this
appeal. In this second claim, Future Forest sought $14,743,430.72 in “lost gross profits”
based on the Forest Service’s alleged breach of the duty of good faith and fair dealing in not
releasing 150,000 acres during the ten years of contract performance. After the Forest
Service denied the claim, Future Forest timely filed this appeal.
In its complaint, Future Forest alleges that:
[T]he Contracting Officer, the Forest Supervisor and her contracting staff
made statements at meetings with all [the] offerors and elsewhere that,
notwithstanding the Amendments [setting forth the guaranteed minimum of
5000 acres for a total of 50,000 acres over the term of the contract], the Forest
Service would, nevertheless, still treat 150,000 acres over the term of the
contract.
As a result of these representations, Future Forest states that the Forest Service created a
“reasonable expectation” that it would release 150,000 acres. Future Forest further alleges
that the Forest Service failed to fulfill this reasonable expectation as the result of animus of
2

In referring to 5000 acres, we note that the Forest Service could also release
an equivalent amount in green tons.

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a Forest Service official toward Future Forest and the decision to direct funding to another
Forest Service contract instead of the WMSC. The failure of the Forest Service to fulfill
these reasonable expectations, Future Forest asserts, constitutes a breach of the duty of good
faith and fair dealing. Finally, Future Forest describes the damages it seeks in this appeal
as an alternative, not in addition to, the damages it seeks in CBCA 5764.3
Discussion
I.

The Parameters of the Duty of Good Faith and Fair Dealing

Implied in every contract is a duty of good faith and fair dealing in its performance
and enforcement. Lakeshore Engineering Services, Inc. v. United States, 748 F.3d 1341,
1349 (Fed. Cir. 2014); Metcalf Construction Co. v. United States, 742 F.3d 984, 990 (Fed.
Cir. 2014). It is well settled that the covenant of good faith and fair dealing “imposes
obligations on both contracting parties that include the duty not to interfere with the other
party’s performance and not to act so as to destroy the reasonable expectations of the other
party regarding the fruits of the contract.” Centex Corp. v. United States, 395 F.3d 1283,
1304 (Fed. Cir. 2005). “What is promised or disclaimed in a contract helps define what
constitutes ‘lack of diligence and interference with or failure to cooperate in the other party’s
performance.’” Metcalf, 742 F.3d at 991 (quoting Malone v. United States, 849 F.2d 1441,
1445 (Fed. Cir. 1988)). “[T]he nature of that bargain is central to keeping the duty focused
on ‘honoring the reasonable expectations created by the autonomous expressions of the
contracting parties.’” Id. (quoting Tymshare, Inc. v. Covell, 727 F.2d 1145, 1152 (D.C. Cir.
1984)). “The implied covenant of good faith and fair dealing is limited by the original
bargain: it prevents a party’s acts or omissions that, though not proscribed by the contract
expressly, are inconsistent with the contract’s purpose and deprive the other party of the
contemplated value.” Metcalf, 742 F.3d at 991. However, the implied duty “cannot expand
a party’s contractual duties beyond those in the express contract or create duties inconsistent
with the contract’s provisions.” Precision Pine & Timber, Inc. v. United States, 596 F.3d
817, 831 (Fed. Cir. 2010); see also Bell/Heery v. United States, 739 F.3d 1324, 1335 (Fed.
Cir. 2014).
II.

Ordering Obligations in ID/IQ Contracts

ID/IQ contracts provide that over the stated period of time the Government will order
an amount of goods or services within the minimum and maximum order amount stipulated
3

Future Forest makes clear that it does not base its claim on allegations of bad
faith on actions of Forest Service officials.

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in the contract. FAR 16.504. This allows the Government considerable flexibility in meeting
its needs, without some of the obligations of a requirements contract and can provide more
latitude than a definite quantities contract. Travel Centre v. Barram, 236 F.3d 1316, 1318
(Fed. Cir. 2001) (citing Stratos Mobile Networks U.S.A. v. United States, 213 F.3d 1375,
1380 (Fed. Cir. 2000)); FAR 16.501-2. However, unlike a requirements contract where the
contractor is entitled to an exclusive relationship to provide the Government with particular
goods/services, the contractor in an ID/IQ contract is only guaranteed to receive the
minimum quantity set forth in the contract. Travel Centre, 236 F.3d at 1319; FAR 16.503.504. This minimum order quantity is the principal consideration provided by the
Government in an ID/IQ contract. TranBen, Ltd. v. Department of Transportation, CBCA
5448, 17-1 BCA ¶ 36,635, at 178,430 (citing Maxima Corp. v. United States, 847 F.2d 1549,
1557 (Fed. Cir. 1988)).
The importance of the minimum guarantee terminology in this and other ID/IQ
contracts is an essential element of the contract. Under the clear terms of the WMSC, the
Forest Service was required to release 5000 acres each year. Future Forest, LLC, 19-1 BCA
at 181,269. We do not look to extrinsic evidence, such as particular individuals’
expectations, to interpret the WMSC provisions because they are clear on their face. Id.
(citing McAbee Construction, Inc. v. United States, 97 F.3d 1431, 1435 (Fed. Cir. 1996).
Simply put, intentions, plans, or anticipations on the part of agency officials, even a
contracting officer, to order more than the stated minimums set forth in an ID/IQ contract do
not equate to contractual commitments. See Travel Centre, 236 F.3d at 1319.
Despite these well-settled principles, Future Forest asserts that there were two
“phases” in this contract, a “minimum guarantee ordering phase” in which the Forest Service
was required to order at least the minimum set forth in the WMSC, and a “discretionary
ordering phase” in which the Forest Service was required to place discretionary orders based
on purported expectations. We find no support for the idea of a discretionary ordering phase
in ID/IQ contracts, the WMSC, regulations, or case law, other than to note that an agency
could, but was not required to, place orders after the minimum had been reached.
The Government’s obligation under the WMSC was to release a minimum of 5000
acres a year. Future Forest’s arguments improperly rely on parole evidence. Expressed or
unexpressed expectations of contractor or agency officials regarding the ultimate volume to
be purchased do not alter the written minimum guarantees. Future Forest or agency officials
could have anticipated releasing a greater volume of work, but legally there can be no
“reasonable expectation” that such hopes will be satisfied.

CBCA 5863
III.

7

Interplay Between Contract Minimums and Duty of Good Faith and Fair Dealing

The Federal Circuit addressed the duty of good faith and fair dealing in Travel Centre,
which involved an ID/IQ contract to purchase travel management services for federal
agencies.4 Specifically discussing the ordering obligations in ID/IQ contracts, the Federal
Circuit noted:
[W]hile an IDIQ contract provides that the government will
purchase an indefinite quantity of supplies or services from a
contractor during a fixed period of time, it requires the
government to order only a stated minimum quantity of supplies
or services. That is, under an IDIQ contract, the government is
required to purchase the minimum quantity stated in the
contract, but when the government makes that purchase its legal
obligation under the contract is satisfied. Moreover, once the
government has purchased the minimum quantity stated in an
IDIQ contract from the contractor, it is free to purchase
additional supplies or services from any other source it chooses.
An IDIQ contract does not provide any exclusivity to the
contractor. The government may, at its discretion and for its
benefit, make its purchases for similar supplies and/or services
from other sources.
Travel Centre, 236 F.3d at 1319 (citations omitted) (emphasis added). Regarding Travel
Centre’s “reasonable expectations,” the Federal Circuit concluded:
Regardless of the accuracy of the estimates delineated in the
solicitation, based on the language of the solicitation for the
IDIQ contract, Travel Centre could not have had a reasonable
expectation that any of the government’s needs beyond the
4

The General Services Administration (GSA) estimated that the contract was
worth approximately $2,500,000 per year, but the contract minimum guaranteed no more
than $100 of revenue. Prior to the start of the contract, GSA received notice that certain
government agencies, comprising half of the expected revenue, would not be using the
contract, but failed to pass that information on to prospective bidders. Although it received
more than $500,000 in gross sales, Travel Centre submitted a breach of contract claim to
GSA alleging a breach of the duty of good faith and fair dealing.

CBCA 5863

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minimum contract price would necessarily be satisfied under
this contract.
....
In sum, when an IDIQ contract between a contracting party and
the government clearly indicates that the contracting party is
guaranteed no more than a non-nominal minimum amount of
sales, purchases exceeding that minimum amount satisfy the
government’s legal obligation under the contract.

Id. (citations omitted) (emphasis added). Neither faulty estimates nor “less than ideal
contracting tactics” are sufficient to overcome the Government’s obligation to order only the
minimum guaranteed in an ID/IQ contract. Id.
The gravamen of Future Forest’s claim is that the duty of good faith and fair dealing
required the Forest Service to order 150,000 acres to fulfill Future Forest’s reasonable
expectations regarding the quantities under the contract:
The Government is bound by its duty of good faith and fair
dealing with respect to placing additional orders and cannot
avoid violating that duty simply because it has fulfilled its
minimum ordering obligation under the contract. Meeting the
contract’s minimum ordering requirement simply does not
ensure that the Government will meet all the implied duties that
continue to apply to placing orders during the subsequent
discretionary ordering portion of the contract – a period that
could well last for many years after the minimum has been
ordered.
Future Forest acknowledges that “[a]n implied duty cannot expand any express
contract duty, including the Government’s express obligation under an ID/IQ contract to
order the minimum amount specified,” but then asserts that “[b]ecause of the creation of a
reasonable expectation with regard to the discretionary ordering portion of the contract, the
Government had an implied duty not to take any action to prevent the ordering of an
additional 100,000 acres in excess of the contract minimum.”
The duty of good faith and fair dealing applies while any contract is being performed,
even after the minimum has been ordered. See TranBen, 17-1 BCA at 178,430. Implied

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duties, such as a duty not to evade the spirit of the bargain and a duty not to hinder
performance, continue during contract performance. Here, however, the bargain was that the
Forest Service would order treatment of no less than 5000 acres a year. To find, based upon
the representations and actions of Forest Service personnel, that the implied duty required
the release of a greater number of acres would violate the contract’s express terms and create
obligations that are “inconsistent with the contract’s purpose.” Metcalf, 742 F.3d at 991.
Future Forest cannot have had “reasonable expectations” rooted in the duty of good
faith and fair dealing that the Forest Service would have ordered more than the contract
minimum because, in this ID/IQ contract, the Government’s obligations regarding quantity
were defined by the contract minimum. “The implied duty of good faith and fair dealing
cannot expand a party’s contractual duties beyond those in the express contract or create
duties inconsistent with the contract’s provisions.” Metcalf, 742 F.3d at 991 (citing Precision
Pine & Timber, Inc., 596 F.3d at 831). Contractors with the government “cannot rely on the
implied covenant of good faith and fair dealing to change the text of their contractual
obligations.” Century Exploration New Orleans, LLC v. United States, 745 F.3d 1168, 1179
(Fed. Cir. 2014). To find otherwise would negate the parts of the contract addressing the
minimum guarantee and the long-standing tenets associated with minimum guarantees in
ID/IQ contracts. Future Forest’s claim for damages based upon the implied duty of good
faith and fair dealing fails because Future Forest could not have reasonable expectations that
reformed the contract into something other than an ID/IQ contract with a minimum guarantee
of 5000 acres a year.
Future Forest posits that the pending motion for summary judgment should be treated
as a motion for failure to state a claim and, therefore, the Board must accept all of Future
Forest’s allegations as true. Future Forest also asserts that “[t]he implied duty also precluded
the Government from not ordering those 100,000 acres for nefarious reasons.” Accepting
these statements as true, we still cannot allow the duty of good faith and fair dealing to
expand the contract minimum on an ID/IQ contract because it would substitute an
aspirational amount for the contract minimum. This Board is mindful that “[t]he implied
duty of good faith and fair dealing does not entitle a contractor to damages for every dubious
action by the contracting agency that impairs the value of the contract.” TranBen, 17-1 BCA
at 178,431. Here the Board need not explore any purported dubious actions, because Future
Forest seeks to impose on the Government extra-contractual obligations.
Future Forest relies upon Burke Court Reporting Co., DOT BCA 3058, 97-2
BCA ¶ 29,323. In Burke, the contractor alleged a violation of the duty of good faith and fair
dealing in the placing of orders for work over the contract minimum. The Board denied the
Government’s motion for summary judgment because the contractor had “a right to rely on

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other contract provisions implying that it will be fairly considered for additional work, if
required by the government.” Burke Court Reporting, 97-2 BCA at 145,801. Future Forest
does not allege a violation of other provisions of the WMSC. Its allegations are rooted in the
quantity to be ordered under the contract. The applicable provision on that point is the
contract minimum; any statements made by agency officials as to ordering expectations were
not contractual guarantees.5
Future Forest also relies on ALK Services, Inc. v. Department of Veterans Affairs,
CBCA 1789, 10-2 BCA ¶ 34,518, in which the Board denied a motion for summary relief in
favor of further discovery. Following fuller development of the record, the Board
determined that ALK involved a requirements contract and involved allegations of bad faith.
See ALK Services, Inc. v. Department of Veterans Affairs, CBCA 1789, et al., 13 BCA
¶ 35,260. That scenario is not applicable to this ID/IQ contract, and the assertion by Future
Forest that the agency’s failure to order anticipated volumes constitute instances of lack of
good faith that are compensable.6
Contrary to presumptions of Future Forest, expectations do not change the express
nature of the minimum guarantee. TranBen, 17-1 BCA at 178,430 (“We know of no decision
finding a breach of the duty where the Government satisfied its minimum ordering obligation
under an ID/IQ contract.”); Dot Systems, Inc. v. United States, 231 Ct. Cl. 765, 769-70
(1982) (finding that it was not reasonable for the contractor to believe that it was entitled to
an estimation rather than the stated minimum). In fact, the opposite conclusion has been
reached consistently by courts and boards, which reveals the importance of the written
agreement. Travel Centre, 236 F.3d at 1319; Abatement Contracting Corp. v. United States,
58 Fed. Cl. 594, 613 (2003); VSE Corp. v. Department of Justice, CBCA 5116, 18-1 BCA
¶ 36,928, at 179,92-13; Electronic Data Systems, LLC v. General Services Administration,
CBCA 1552, 10-1 BCA ¶ 34,316 at 169,507; Crown Laundry & Dry Cleaners, Inc., ASBCA
39,982, 90-3 BCA ¶ 22,993, at 115,481. Expectations do not increase purchasing obligations
or alter the nature of a contract.

5

The decision in Burke was issued several years before the Federal Circuit’s
clarifications in Travel Centre and Metcalfe.
6

The decision on summary relief was issued before the Federal Circuit’s
decision in Metcalf.

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Decision

For the foregoing reasons, respondent’s motion for summary judgment is granted.
The appeal is DENIED.

Patricia J. Sheridan
PATRICIA J. SHERIDAN
Board Judge
We concur:

Joseph A. Vergilio
JOSEPH A. VERGILIO
Board Judge

Jonathan D. Zischkau
JONATHAN D. ZISCHKAU
Board Judge

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/agency%3Acbca%3A558cef94cd460732. Public record. Not legal advice.