November 13, 1992

Appeal of

JOSEPH DICKSON

Under Contract No. HCR 08030

PSBCA No. 3249

APPEARANCE FOR APPELLANT:

Samuel H. Bullock, Esq.

APPEARANCE FOR RESPONDENT:

John T. Farrell, Jr., Esq.

OPINION OF THE BOARD

This appeal is from a final decision of the Contracting Officer which terminated for default Appellant’s highway transportation contract. Appellant has elected to have the appeal processed under the Board’s Small Claims (Expedited) procedure (39 C.F.R. §955.36).

FINDINGS OF FACT

1. On June 15, 1989, Respondent, United States Postal Service, renewed Contract No. HCR 08030, held by Appellant, Joseph Dickson, for a term from July 1, 1989, to June 30, 1993 (Appeal File Section, page (AF) I 3). The contract called for transportation service between Management Sectional Center (MSC) South Jersey, located at Bellmar, New Jersey, and Bridgeton, New Jersey, at an annual contract rate of $59,211.78 (AF I 3, 3C; see Transcript page (TR) 31). Appellant had been a contractor with the Postal Service since 1981 (Tr 8, 47, 67).

2. Appellant’s route schedule under the contract included three round trips on weekdays between MSC South Jersey and Bridgeton New Jersey, with intermediate stops on some of the trips at Monroeville, Elmer, Deerfield St. and Seabrook Farms (AF I 3C).

3. Incorporated into the contract was PS Form 7407T, March 1989, “Basic Surface Transportation Services Contract General Provisions” (AF I 3E), which included the following clauses:

“4. SERVICE REQUIREMENTS AND PROHIBITIONS. – (a) The Contractor shall carry all mail tendered for transportation under this contract . . . with certainty, celerity, and security, in accordance with the operating schedule and between the points fixed in the solicitation . . . .

* * * * *

16. TERMINATION BY THE POSTAL SERVICE FOR DEFAULT.

(a) The Contracting Officer may terminate this contract for default:

(1) For Contractor’s failure to perform service according to the terms of the contract . . . .”

Subparagraph (c) of Clause 16 provided that if it is determined that the contractor was not in default or the default was excusable, the parties’ rights and obligations would be the same as if a termination for convenience had been issued under Clause 17. Clause 17, “Termination for Convenience,” allows the contractor as an indemnity the liquidated damages amount specified in Clause 12(d).

4. A number of contract route irregularities (PS Forms 5500) occurred along Appellant’s route between July 5, 1989, and September 20, 1989, including several instances of “omitted service” (AF II 22, 22A, 23, 24-26; Tr 25).

5. On October 11, 1989, a counseling session was held at which Respondent’s officials advised Appellant that his service had been unacceptable and that unless he could restore service to 100 percent efficiency, further action would be taken (AF II 21; Tr 27-28).

6. Service improved thereafter through the remainder of 1989 although by letter dated December 15, 1989, Respondent’s Administrative Official in commenting on Appellant’s replies to irregularity reports noted that Appellant was being paid to “layover” at Bridgeton until 1505 and that he should not leave early even is someone at Bridgeton authorized it (AF II 19).

7. Chargeable irregularities for failure to observe the contract schedule were issued to Appellant on March 28, 1990, April 17, 1990, and May 8, 1990 (AF IV 35, 49-51A). By letter dated May 14, 1990, Respondent’s Philadelphia TMSC Manager, referring to the 5500’s that had been issued since October 1989, notified Appellant that the letter was a final warning and that unless satisfactory service was restored Respondent would terminate the contract (AF II 17).

8. From June through December 1990 several more chargeable reports of contract route irregularities were issued to Appellant for failure to follow schedule (3), omitted service (2), failure to pick up empty equipment, and delayed mail (AF III 35-36, 52-58A).

9. By letter dated January 25, 1991, the Contracting Officer, referring to the warning letter of May 14, 1990, noted that several PS Forms 5500 for unsatisfactory performance had been issued to Appellant since May of 1990 (AF II 13, 13A). Appellant was advised that further poor performance would not be tolerated and that the letter was a final warning to restore service within three days or termination action would be taken (id.).

10. In a subsequent letter dated March 21, 1991, the Contracting Officer stated that a review of the irregularity file showed there had been six PS Forms 5500 issued to Appellant between February 9 and February 28, 1991 (AF II 11, 12, 12A). Appellant was requested to attend a conference in Respondent’s Philadelphia TMSC Office to discuss “unsatisfactory service” (AF II 11).

11. During the ensuing conference held on March 26, 1991, the items discussed included mechanical failures, omitted service, adherence to the contract schedule, picking up empty equipment and failing to respond to PS Forms 5500 and to communicate with the South Jersey office (AF II 10). Appellant stated that he would implement measures to correct the problems (AF II 10A). Respondent’s representative stated that unless Appellant took immediate corrective action within five days and maintained service at a satisfactory level for the remainder of the contract term, the matter may be forwarded to the Contracting Officer for termination action (id.).

12. The record indicates that thereafter for the remainder of the calendar year 1991 (i.e., April through December 1991), seven contract route irregularities, including three instances of omitted service, were charged against Appellant (AF II 7A, IV 64, 64A, 65, 65A, 65B, 66, 66A, 67, 67A, 68, 69, 69A, 69B, 69C).

13. In 1992 Appellant was issued PS Forms 5500 on February 24, March 9, and April 11, for failures to observe the schedule (AF II 9B, 9C, IV 37, 38, 70, 70A, 71A, 72). The route irregularity charged on February 24, 1992, involved a flat tire in Elmer which prevented Appellant from completing a portion of the route and required the Postal Service to handle the mail (TR 36-38, 50-52). The PS Forms 5500 for March 9 and April 11 involved Appellant or his drivers leaving stations early which resulted in mail being left behind (AF IV 71A, 72; Tr 39-40, 41-43, 54-56). Appellant filed no replies to the PS Forms 5500 for February 24 and April 11 (AF IV 70, 70A, 72; Tr 64, 74). Appellant’s reply to the PS Form 5500 for March 9, 1992, did not deny that he left early but was to the effect that he was fully loaded and had asked the dock supervisor if there was any more mail before he left (AF II 9B, 9C). On March 10, 1992, when confronted by Respondent’s administrative official and told that both the platform supervisor and the coordination supervisor were witnesses to his leaving early without permission, Appellant was unable to furnish the name of the person with whom he talked (Tr 38-40, 77; AF 9B, 71A). At the hearing Appellant stated that the platform supervisor (who reported the violation) had authorized his leaving early (Tr 55).

14. During the contract period, July 5, 1989, to May 6, 1992, Appellant was issued over 40 PS Forms 5500, although some were for the same days. Thirteen PS Forms 5500 were issued for omitted service, seven in 1989, two in 1990, and four in 1991. Appellant was charged with failure to observe the schedule in 17 PS Forms 5500. With respect to virtually all of the PS Forms 5500, either no replies were filed by Appellant, or in his reply, he did not deny the charge. (See AF IV 35-72). Respondent’s contract administrator at the South Jersey MSC evaluated Appellant’s performance as very poor, worse than other contractors whose routes she supervised (Tr 29).

15. In a final decision dated May 6, 1992, the Contracting Officer notified Appellant that his right to perform service under the contract was terminated under Clause 16(a)(1) of the General Provisions for failure to perform service according to the terms of the contract (AF II 6). It was further stated that Appellant had been advised in a formal conference on March 26, 1991, of continuing irregularities on the route and was given five days to restore service to an acceptable level and maintain service at such a level. The Contracting Officer then listed the irregularities occurring between February 24, 1992, and April 11, 1992, and referred to a letter issued to Appellant on March 25, 1992 (AF II 8), for continued unsatisfactory service. (Id.)

16. A timely appeal was filed by Appellant (AF V 75).

DECISION

In this appeal Respondent argues that the contract was properly terminated because Appellant failed to satisfactorily perform service. Respondent points out that despite repeated warnings and counseling sessions, Appellant was unable to improve contract service.

The record evidences numerous serious contract route irregularities throughout the contract period of slightly less than three years. Also, several warnings were issued to Appellant to improve his service and he was counseled on two occasions concerning performance deficiencies.

In his Complaint and argument at the hearing, Appellant has challenged the PS Forms 5500 issued in 1992, contending that only those alleged violations formed the basis of the termination and that Appellant had legitimate excuses. Although there is some conflict in the evidence concerning the irregularities, based on the preponderance of the evidence, it is concluded that those irregularities were excusable, but were properly chargeable against Appellant (see Finding 13). Moreover, even though the Contracting Officer in his termination letter referred only to the 1992 irregularities, Appellant’s entire record since 1989 may be considered by the Board in determining whether the termination action was justified. F.W.H. Motor Transport, Inc., PSBCA No. 1317 (July 30, 1985).

As indicated in the findings, the record amply demonstrates that Appellant’s performance was unsatisfactory, and, despite several opportunities given by Respondent, Appellant was unable to improve service significantly on a consistent basis. It is concluded that the default termination issued by the Contracting Officer was a proper exercise of her discretion to take such action.

Accordingly, the appeal is denied.

James E. Lemert

Administrative Judge

Board Member