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Ridge Runner Forestry v. Veneman - 287 F.3d 1058 (Fed. Cir. 2002)


To be valid and enforceable, a contract must have both consideration to ensure mutuality of obligation and sufficient definiteness so as to provide a basis for determining the existence of a breach and for giving an appropriate remedy. To constitute consideration, a performance or a return promise must be bargained for. And the promise or apparent promise is not consideration if by its terms the promisor or purported promisor reserves a choice of alternative performances.


Ridge Runner Forestry is a fire protection company located in the Pacific Northwest. In response to a request for quotations (RFQ) issued by the Forestry Service, Ridge Runner submitted a proposal and ultimately signed a document  entitled Pacific Northwest Interagency Engine Tender Agreement (Tender Agreement). The Tender Agreement incorporated the RFQ in its entirety, including the following two provisions in bold faced lettering: (1) "Award of an Interagency Equipment Rental Agreement based on response to this Request for Quotations (RFQ) does not preclude the Government from using any agency or cooperator or local EERA resources"; and (2) "Award of an Interagency Equipment Rental Agreement does not guarantee there will be a need for the equipment offered nor does it guarantee orders will be placed against the awarded agreements."  Additionally, because the government could not foresee its actual equipment needs, the RFQ contained language that allowed the contractor to decline the government's request for equipment for any reason: "Because the equipment needs of the government and availability of contractor's equipment during an emergency cannot be determined in advance, it is mutually agreed that, upon request of the government, the contractor shall furnish the equipment offered herein to the extent the contractor is willing and able at the time of order. " The RFQ also included a clause informing bidders that they would not be reimbursed for any costs incurred in submitting a quotation. Ridge Runner signed Tender Agreements in 1996, 1997, 1998, and 1999. In 1999, it presented a claim for $180,000 to the contracting officer alleging that the Forestry Service had violated an "implied duty of good faith and fair dealing" because Ridge Runner had been "systematically excluded for the past several years from providing services to the Government." In response, the contracting officer told Ridge Runner that she lacked the proper authority to decide the claim. Ridge Runner timely appealed the decision to the Department of Agriculture Board of Contract Appeals. The board granted the government's motion to dismiss concluding that because no contract had been entered into, it lacked jurisdiction under the Contract Disputes Act (CDA)


Was the Tender Agreement a binding contract that placed specific obligations upon the government? 




The appellate court determined the agreement was nothing but an illusory promise. The appellate court noted the agreement contained no clause limiting the government's options for firefighting services; the government merely "promised" to consider using the company for firefighting services. Also, the agreement placed no obligation upon the company. If the government came calling, the company "promised" to provide the requested equipment only if it was "willing and able."

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