December 29, 2003
In the Matter of the Petition by
VINCENT PELLECHIA
36 Eldorado Drive
at
Wayne, NJ 07470-6528
P.S. Docket No. DCA 03-322
APPEARANCE FOR PETITIONER:
Charles Scialla
453 Preakness Avenue #5
Paterson, NJ 07502-1121
APPEARANCE FOR RESPONDENT:
Kathy Thomas
Paralegal Specialist
United States Postal Service
380 W. 33rd Street, Room 4516
New York, NY 10199-9003
FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982
Petitioner, Vincent Pellechia, filed a Petition for Hearing after being issued a Notice of Involuntary Administrative Salary Offsets by his supervisor in November 2002. This Notice stated the Postal Service's intention to withhold $3,100.51 from Petitioner's salary to recover a shortage in an account for which Petitioner was responsible.
A hearing was held in Newark, New Jersey on November 5, 2003.[1] The Postal Service presented testimony from a former postmaster and two other postmasters, who conducted an audit at Petitioner’s post office in November 2000, and a customer service analyst. Petitioner testified on his own behalf, and also presented testimony from a window clerk at Petitioner’s post office. Both parties also relied on documents that had been filed previously. The following findings of fact are based on the entire record.
FINDINGS OF FACT
1. At the time pertinent to this case, Petitioner was the officer-in-charge of the Roseland, New Jersey Post Office, and was custodian of the main stamp stock at Roseland (Tr. 17, 40, 52, 119).[2]
2. In late November 2000, three postmasters were assigned to conduct an audit of the Roseland main stock because Petitioner was leaving that office and the main stock was to be turned over to another supervisor.[3] On November 28, 2000, the three of them, along with Petitioner, counted the main stock. The count showed a shortage of $3,100.51. (Tr. 18-19, 21-22, 40, 44, 51; PS Ex. 1).
3. Before beginning the count, they printed out an inventory list from the POS system that showed the opening balance in the account to be $50,602.84. Their count showed that only $47,502.33 was present. A PS Form 3294, Cash and Stamp Stock Count and Summary, was signed by Petitioner, indicating that he agreed with the accuracy of the count. (Tr. 24-25, 45-46, 54, 132; PS Ex. 1).
4. At the time the shortage was found, Petitioner stated that he thought it was caused by a computer “glitch,” or that someone else had the stock. No count of any clerks’ stamp stock was done at that time. (Tr. 44, 55, 62-63).
5. A count of the retail floor stock at Roseland on November 29, 2000, showed an overage of $1,066.77. The retail floor stock, i.e., stamps sold to customers, is supplied from the main stock. This amount was not offset against the main stock shortage because there were no documents to show that the two were related.[4] (Tr. 22-23, 33, 60; PS Ex. 10).
6. Petitioner’s supervisor issued Petitioner a Notice of Involuntary Administrative Salary Offsets, dated November 18, 2002, alleging a debt of $3,100.51. Petitioner filed a Petition for Hearing on August 4, 2003.[5]
DECISION
The standard for determining an employee’s liability in a case such as this provides that employees to whom postal funds and accountable paper are consigned “are held strictly accountable for any loss unless evidence establishes that they followed the postal procedures established when performing their duties.” Handbook F‑1, Post Office Accounting Procedures (November 1996), §141.
Respondent’s burden of proof in a case of unexplained shortage is to show that a loss occurred from an account for which the employee is accountable. Respondent is not required to prove any specific dereliction, or act of negligence, by Petitioner. When a properly conducted inventory, or audit, shows a stock shortage relative to a previously established balance, this constitutes proof of loss unless other evidence raises sufficient doubt about the accuracy of the inventory or the previously established balance, or otherwise suggests that there may have been no actual loss.
Respondent’s contention is that the audit of the Roseland main stock conducted on November 28, 2000 was properly performed, that Petitioner agreed that the count was accurate, and that there is no dispute over the fact that Petitioner was the main stock custodian at that time. Therefore, Respondent argues, the evidence proves a loss of $3,100.51, and there is no basis for relieving Petitioner of liability.
Petitioner’s defense is centered on a count of his main stock that he says was conducted by another supervisor approximately a month or two before the November 28, 2000 audit, and a count of a clerk’s account approximately three weeks before that. There are no records of either of these counts, and that is also part of Petitioner’s defense. Because all these events took place three years before the hearing, he argues that the absence of these records has damaged his ability to present his case (Tr. 8-9, 139-40).
Petitioner testified that, sometime in September 2000, he counted his clerk’s account and found a $1400 overage. Approximately three weeks later, he and another supervisor found that the main stock was short 100 coils of 33¢ stamps – total value $3,300. (Tr. 122-27, 133-34). His theory is that the 100 coils missing from the main stock, with a value very close to the alleged loss, had been transferred to the clerk sometime earlier.
Even if the records Petitioner sought to find were available, at most they would show a $3,300 shortage in Petitioner’s account, and a $1,400 overage in the clerk’s account three weeks earlier. They would not show that the overage and the shortage were related. Also, some doubt is cast on Petitioner’s theory by other evidence. The clerk testified at some length about an error she made in cashing a check for another employee,[6] but gave no testimony about a $1,400 overage in her account on an audit the next day. Further, Petitioner did not pursue this matter at the time of the November 28, 2000 audit, when it would likely have been fresh in his mind, and when any pertinent records would likely have still been available.
As to any computer “glitch” that may have occurred, Petitioner did not present evidence that demonstrates how this could have created a false shortage at the November 28, 2000 audit.
Respondent’s evidence is sufficient to prove a loss of $3,100.51, and Petitioner has not shown a basis for relieving him of liability under the standard quoted above. The Petition is denied. Respondent may collect $3,100.51 from Petitioner’s salary.
Bruce R. Houston
Chief Administrative Law Judge
[1] The hearing was conducted by the undersigned Administrative Law Judge via speaker telephone from Arlington, Virginia. All other participants, including the court reporter, were present in a conference room at the hearing site.
[2] References to the hearing transcript are “Tr._.” References to documents filed by the parties prior to the hearing will be identified by exhibit number.
[3] As there is no indication that Petitioner’s successor participated in the audit, it might also be that this audit was related to the conversion of the Roseland office to a segmented inventory accounting (SIA) system, which occurred at about the same time.
[4] Although some of Respondent’s witnesses were asked about the unit reserve being the source of the retail floor stock, Petitioner did not mention this overage in his testimony, and made no argument at the hearing that this floor stock overage should be offset against the main stock shortage.
[5] Respondent filed a motion to dismiss the Petition because it was not timely filed, i.e., that it was not filed within fifteen (15) days of Petitioner's receipt of the Notice of Involuntary Administrative Salary Offsets. The motion was granted, in a Final Decision issued on September 25, 2003. Petitioner filed a request for reconsideration under 39 C.F.R. §961.9. Respondent then agreed that the case should go forward and be decided on the merits. Accordingly, the September 25, 2003 Final Decision was vacated and the case was reinstated on our docket.
[6] To the extent that this testimony was relevant at all, Petitioner later explained that the reason he counted the clerk’s account was that she told him about her apparent check cashing error the day after it happened.