In the Matter of the Petition by ) January 6, 1998 ) DONALD J. DORAN ) P. O. Box 105 ) ) at ) ) Blanchard, ID 83804-0105 ) P.S. Docket No. AO 97-335 APPEARANCE FOR PETITIONER: Daniel J. Bosse 1223 S. Lynn Street Moscow, ID 83843-3910 APPEARANCE FOR RESPONDENT: Mitchell J. Hicks Senior Labor Relations Specialist United States Postal Service 707 W. Main Avenue, Suite 600 Spokane, WA 99299-9402
Petitioner, Donald J. Doran, filed a Petition for review of a deduction from his retirement annuity made at the request of Respondent, United States Postal Service, to satisfy an alleged debt to Respondent. The Petition was docketed under the procedures set forth in 39 C.F.R. Part 966, which allow a former employee to challenge collection of a debt alleged by Respondent. The claim was based on shortages occurring in the accounts of the Blanchard, Idaho Post Office at a time when Petitioner was the postmaster and responsible for the accounts of the office.
At the parties' election, the matter is being decided on the record without an oral hearing.
1. Prior to his retirement in late 1996, Petitioner was the postmaster of the Blanchard, Idaho Post Office. He was custodian of the office's main stock as well as a flexible credit assigned to him for sales to customers. (Respondent's Exhibit ("RX") 5).
2. On November 27, 1996, the main stock and Petitioner's flexible credit were counted incident to transfer of responsibility for the office to an officer-in-charge. The count of the main stock showed an apparent shortage of $51.57, and Petitioner's flexible credit was $7.29 short (RX 5.5, 5.6). Petitioner paid Respondent $58.86 by personal check to cover the shortages (RX 5; Kramer Memorandum of April 23, 1997).
3. After the counts, migratory bird stamps valued at $90 were discovered that should have been included in the count of the main stock. Had they been properly included, the main stock would have shown an overage of $38.43. (RX 5, 5.5, 5.9).
4. At the time of transfer, total office accountability of the Blanchard Post Office, consisting of the sum of the main stock, Petitioner's flexible credit and the credit of the postmaster replacement/clerk, as shown in the office Accountbook was $12,386.35. The total accountability as shown on the office's Consolidated PS Form 1412, which records the same accountabilities, was $12,111.72, or $274.63 less than the Accountbook figure. (RX 5, 5.1, 5.2, 5.3, 5.4).
5. After Petitioner retired on December 1, 1996, the post office received a Statement of Differences, which is a report from Respondent's Minneapolis accounting office indicating that the post office had made an accounting error in the past and directing adjustments to the office's records (RX 5, 5.7). That Statement of Differences reflected an "Audit Shortage" of $146.37 identified as "Audit Differences Money Order Division (See Form 800 Attached)"(1) and an "Inventory Shortage" of $38. The Statement instructed the office, "Immediately enter the net difference(s) shown above in your Accountbook." (RX 5.7).
6. On December 6, 1996, Respondent issued Petitioner a Notice of Debt Determination asserting a claim for $459 ($274.63 (Finding 4) + $146.37 + $38 (Finding 5)). The figure was revised to $362.14,(2) and on April 11, 1997, Respondent sent a Statement (invoice) to Petitioner claiming that amount. (Attachment to Petition).
7. Respondent notified the Office of Personnel Management of its claim and requested that the claim be satisfied from Petitioner's retirement annuity. On April 14, 1997, Office of Personnel Management sent Petitioner a notice that it intended to collect $364.10(3) from his annuity payments on behalf of Respondent. (Attachment to Petition).
8. The amount of $364.10 was deducted from Petitioner's annuity payments, and Petitioner has filed this Petition for review of that deduction. (Petition).
Respondent concedes that the $51.57 Petitioner paid on account of the apparent shortage in the main stock (Finding 2), was paid in error because, when the late-discovered bird stamps are included (Finding 3), the main stock was over and not short. Accordingly, if it has not already been reimbursed to Petitioner, Respondent is to reimburse $51.57.
Respondent concedes that giving Petitioner credit for the $51.57 overpayment reduces the amount of its claim to $310.57(4), but contends that it has demonstrated that it suffered a loss of $310.57 for which Petitioner is responsible. Petitioner argues that he should have been notified of any shortages before he retired so he would have had an opportunity to investigate them, plus he claims the office shortages are accounted for by a shortage disclosed on December 2, 1996, in the credit of the postmaster replacement/clerk.
Respondent has shown that there was a $274.63 difference between the total office accountability as shown in the Accountbook and as shown in the Consolidated PS Form 1412, which is supposed to reflect the same credit totals. However, it is Respondent's burden to demonstrate that that discrepancy equates to an actual financial loss to the Postal Service, and it has not done so. Not every accounting discrepancy results in a loss to Respondent, and there is insufficient evidence in the record to show that Respondent suffered a loss of $274.63.
The remainder of Respondent's claim stems from the Statement of Differences' "Audit Shortage" related to an error made in recording a money order transaction before Petitioner retired. Again, Respondent has failed to meet its burden to demonstrate that the reported "Audit Shortage" constitutes a loss to Respondent. Other than what is reflected in the Statement of Differences, there is no evidence of the source of the money order error or the basis for Respondent's claim that it suffered a loss due to Petitioner's actions.
Accordingly, Respondent has not demonstrated that it suffered a loss for which Petitioner is responsible. Therefore, the deductions from Petitioner's annuity payments were improper, and the amount of $364.10 is to be reimbursed to Petitioner immediately. Adding to this the $57.71 Respondent concedes should not have been collected due to the main stock "shortage" results in a total payment due Petitioner of $421.81. The Petition is granted.
Norman D. Menegat Administrative Judge
2. The original figure was reduced by $38 because an offset was found for the inventory shortage in that amount shown on the Statement of Differences and further reduced by the $58.86 Petitioner had already paid to arrive at the final claim figure of $362.14 (RX 5).
3. The record does not indicate why Office of Personnel Management's figure was $1.96 higher than Respondent's.
4. This calculation is in error, as Respondent had already given Petitioner credit for the $58.86 he paid in reducing its claim from the original $459 (See footnote 2, above).