In the Matter of the Petition by ) June 24, 1997 ) LAVERNE BAPTIST ) 3209 Dynasty Drive ) ) at ) ) Forestville, MD 20747-3856 ) P.S. Docket No. DCA 97-102 APPEARANCE FOR PETITIONER: Carlos A. Wharry United States Postal Service 515 S. Camp Meade Road Linthicum Heights, MD 21090-9998 APPEARANCE FOR RESPONDENT: Julia A. Bills Labor Relations Specialist United States Postal Service 900 Brentwood Road, NE Washington, DC 20066-7602
Petitioner, Laverne Baptist, filed a timely petition requesting an oral hearing under the Debt Collection Act of 1982, as amended, 5 U.S.C. §5514(a), after receiving a Notice of Involuntary Administrative Salary Offsets on March 6, 1997. The Notice advised Petitioner that she was indebted to the Postal Service in the amount of $9,150.91 resulting from a shortage in her stamp accountability at the Cabin John, Maryland Post Office.
A hearing was held on May 8, 1997, in Washington, DC. The Postal Service presented the testimony of two employees. Petitioner presented the testimony of one employee, as well as testifying on her own behalf. In addition to the transcript of the hearing, the record also contains Respondent's Exhibits RX-1 through RX-5 and RX-7 through RX-9 (RX-6 is a duplicate of RX-8), and Petitioner's Exhibits PX-1 through PX-11. The parties submitted written closing arguments after receipt of the transcript.
FINDINGS OF FACT
1. Petitioner is the postmaster and custodian of the main stock at the Cabin John, Maryland Post Office. On October 6, 1995, Petitioner's main stock was audited. Petitioner participated in this audit. Petitioner did not agree with the results of this audit, and a second audit was held on October 23,1995 (in which Petitioner again participated). This second audit disclosed a shortage of $15,164.41. Petitioner signed this audit, thereby indicating her agreement with its content. (Respondent's Exhibit No. (RX) 1, 2; Transcript page (Tr.)12, 13).
2. Subsequent audits of other accounts in the post office disclosed overages in the amount of $11,204.10. These overages were credited against the $15,164.41 shortage in Petitioner's main stock, reducing the overall shortage to $3,960.31. (RX 7; Tr. 38-41).
3. An additional $5,190.60 debt was charged against Petitioner based on a "Statement of Account Audited" which was issued by the Postal Accounts Section in Minneapolis, Minnesota. This document identified four shipments of stamps to Petitioner in May and June of 1993, which were never recorded by Petitioner in her accounts (RX-8; Tr. 44-46).
4. Shipments of stamps, such as those identified in the "Statement of Account Audited", are sent by registered mail, which is signed for by the recipient, and are followed by an invoice which is sent by regular mail. The recipient of a stamp shipment then compares the amount listed on the invoice with the actual amount received in the registered mail shipment to determine if the invoice is accurate. A copy of the invoice is also sent to the Postal Accounts Section in Minneapolis. A recipient of a shipment who believes the amount indicated on the invoice is incorrect should immediately contact the Stamp Distribution Office. (Tr. 44-46). However, in the case of an automatic shipment of stamps (as opposed to shipments and quantities specifically requested by Petitioner), the invoice accompanies the shipment. Thus, Petitioner would not become aware of the fact that a particular automatic shipment never arrived until the quarterly issuance of a Statement of Account Audited. (Tr. 59-61).
5. Petitioner disagreed with the information on the "Statement of Account Audited" and requested reconsideration(1) (RX-6; Tr. 48, 65, 66).
6. A 1995 audit of the Stamp Distribution Office servicing Petitioner's post office disclosed an overage in the stock at that office. In preparation for this hearing Petitioner requested a copy of this audit to determine whether that overage was related to her shortage. However, Respondent did not provide Petitioner a copy of the audit. (Tr. 75-77).
7. On March 6, 1997, Respondent sent Petitioner a Notice of Involuntary Administrative Salary Offsets asserting a claim of $9,150.90, and Petitioner filed a timely petition challenging the alleged debt (Petitioner's Exhibit PX-1).
DECISION
The standard of liability in this dispute can be found in Section 130, Liability, of Handbook F-1, Post Office Accounting Procedures. (2) This section provides, inter alia, that postmasters who act as custodian of the main stock of their post office will be held strictly liable for any loss to their stock unless they can demonstrate that they exercised reasonable care in the performance of their duties. Thus the Postal Service must first show that a financial loss to the Postal Service actually occurred and that Petitioner was accountable for the funds lost. If Petitioner is to avoid liability once the Postal Service shows a loss, then she must demonstrate that she exercised reasonable care in the management of the main stock.
Respondent argues that the audit of Petitioner's accountability establishes that a loss of $3,960.31 to the Postal Service occurred at the Cabin John, Maryland Post Office and that the "Statement of Account Audited" from the Minneapolis Postal Data Center (PDC) establishes that a further loss of $5,190.60 should be charged to Petitioner. Petitioner did not present any evidence that she exercised reasonable care in the performance of her duties. Instead, Petitioner challenges the Postal Service's findings that any loss occurred.
For the reasons set forth below, I find that Respondent has established that a loss to the Postal Service occurred with respect to the $3,960.31 shortage found in Petitioner's accountability at the Cabin John Post Office.
Respondent's audit of Petitioner's accountability was conducted on two separate occasions. On both occasions Petitioner fully participated in the audit. Petitioner did not agree to the results of the initial audit, conducted on October 6, 1995, and it was carried out once again on October 23, 1995. Petitioner concurred in the results of this second audit and signed the audit documents. The $15,164.41 shortage found in this audit was subsequently reduced to $3,960.31 as a result of overages found in other accounts in Petitioner's post office. (Finding of Fact No. (FOF) 1, 2). Petitioner has not offered any evidence to challenge the accuracy of this audited shortage.
Respondent's claim of a further $5,190.60 loss has not been established. The existence of this loss is premised entirely on a "Statement of Account Audited" issued in September of 1993 by the Minneapolis PDC. According to testimony by Respondent's witness, this statement indicates that stamp shipments to Petitioner were not recorded into her accounts. (FOF 3, 4). Although Respondent's witness also testified that such shipments were made by registered mail and that Petitioner would have had to sign for the registered mail shipment, no evidence was offered purporting to show that Petitioner had signed for receipt of the shipments in question.
Petitioner disagreed with the "Statement of Accounts Audited" and asked for reconsideration of its conclusion (FOF 5). Respondent offered no explanation of the results of Petitioner's request for reconsideration. Furthermore, Respondent failed to provide Petitioner information she had requested regarding the results of an audit of the Stamp Distribution Office that services her post office. This information was sought by Petitioner because she believed that it would show that overages found in the audit of that office coincided with the stamp shortages she was being charged with. (FOF 6).
Respondent 's reliance on the 1993 "Statement of Account Audited," standing alone, is not sufficient proof that a loss in the amount of $5,190.60 was actually incurred by the Postal Service. See Eulalia Anne S. Lee, P.S. Docket No. 97-38, June 13, 1997. Accordingly, I find that Petitioner is not liable for this amount.
This petition is sustained to the extent that Petitioner's liability to the Postal Service is reduced to $3,960.31.
William K. Mahn Administrative Judge
2. The F-1 Handbook was revised effective November 1996. However, as the events relevant to this case arose under the old version, that is the version which will be applied to determine Petitioner's liability in this case.