VALUATION OF DAMAGES TO IMMATURE TIMBER 181 



The truth of this last statement is clearly shown if one considers, for 

 instance, two 25-year-old stands of Douglas fir — one in Colorado, where 

 growth is slow, yields low, cost of successful planting fairly high, and 

 the other in western Oregon, where growth is rapid, rotations fairly 

 short, yields large, cost of planting low. By the cost method the Colo- 

 rado stand would appear to be worth at least as much and usually more 

 than the Oregon stand, which would be contrary to fact. Roth^'^ says 

 that timber values in the United States will eventually be determined 

 by the cost of growing timber, as is now the case to a certain extent in 

 parts of Europe. While this might be true if the business were entirely 

 in private hands and if forests were grown for no other purpose than 

 the production of timber, it seems open to question as long as the Fed- 

 eral Government and States adhere to the policy of maintaining a forest 

 cover on the headwaters of important streams partly for timber pro- 

 duction, but even more for the public benefits involved in watershed 

 protection and other influences of forests. Douglas fir prices may be 

 determined by what it costs to produce it in the Northwest, but Douglas 

 fir will continue to be grown and sold in the Rocky Mountain region, 

 even though the cost considerably exceeds the returns. 



Several writers,^^ to overcome the objection that two similar stands 

 are of equal value, though their cost has actually been different, advo- 

 cate using cost of replacement at present prices rather than the actual 

 cost. This is open to the same objection as the use of actual cost and 

 is even less satisfactory, because it not only does not represent the value 

 of the stand, but does not even represent what the owner has actually 

 paid out. Since the principle underlying all estimates of damage should 

 be to restore the owner to the same financial position he was in before 

 the damage was done,'" he should not receive either more or less than 

 he would have received had his forest not been injured. If it is not 

 injured, he will receive whatever the crop will bring in the market, less 

 future costs up to maturity, or if young stands had a market value, he 

 would receive this market price, which would be equal to cost of pro- 

 duction plus any profit he may have made by good management or 

 favorable conditions, or minus any loss he may have incurred through 

 poor management. Damages awarded to him should therefore include 

 this profit or loss, as well as actual cost ; if he has spent too much on 

 his stand and lost money, he is not entitled to get back his loss bv burn- 



" Forest Valuation, p. 42. 



"Albert: Lehrbuch der Waldwertberecliiiung, pp. 2ofF. 



Stoetzer : Waldwertrechnung und forstliche Statik, p. 118. 

 " See Standard Instructions for the Determination of Fire Damages. 



