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liable for all damages resulting from the breach. The concept 

 pursuant to which damages are measured is placing the 

 non-breaching party — i.e. . KPC — in as good a position as it 

 would have been in if its contract was fully performed by the 

 government. Under this standard, damages normally include at 

 least the contractor's expenditures and losses in performing 

 the contract and, if properly proved, the full measure of the 

 profits that would have been realized through full contract 

 performance. The breach would also be subject to the interest 

 provision of the Contract Disputes Act. The $50,000 

 performance bond paid by KPC would also be subject to recovery. 



If considered to result in a Fifth Amendment taking, 

 legislative cancellation of the KPC contract would require the 

 government to pay just compensation to KPC — that amount which 

 would reflect the full monetary value of the taken property. 

 Under "takings" analysis, the contractor is to be put in the 

 same position, monetarily, as if its property had not been 

 taken. Here, KPC would be entitled to be placed in the same 

 position it would have occupied if the contract was not 

 cancelled. As the contract guarantees KPC a sufficient 

 quantity of timber at competitive rates for the "full scale 

 operation" of its mill, one must look at the effect on KPC of 

 the loss of such assured supply, an essential component of any 

 viable pulp mill operation. In addition, another component of 

 just compensation would be the added cost to KPC of obtaining 

 from other assured sources (if other assured sources are shown 

 even to exist) assured volumes of timber of sufficient quality 



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