The government entered into a one year with four option years requirements contract to supply an estimated 104,000 meals per year which was broken down into quarterly amounts.  The contract provided that price adjustments would be made “each calendar quarter” for actual quantities served outside the estimated range.  The number of meals fell substantially below the estimates for almost all quarters over the five years.  Contractor twice notified the CO about the shortfalls but was told they would be addressed if they became a problem.  At the end of the five years, the government pressed for a price adjustment of $192,000 for the shortfall and explained that quarterly price adjustments were not taken because they were “missed”.  The  Appeals Board sided with the contractor saying the government could not reduce the contract amount at the end of the contract because the contract required the government to exercise its right for price adjustment at the end of each quarter (M&C Cumberland, DOTBCA 3014).  

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