FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982

Petitioner, Ronald D. Phillips, filed a timely petition for a 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 from Respondent, the United States Postal Service. The Notice informed Petitioner that Respondent intended to deduct a total of $1,168.00 from his salary based on a loss in that amount of vending machine credit under his responsibility.

Petitioner elected a hearing based solely on written submissions, and the parties were afforded an opportunity to submit additional evidence and argument in support of their positions.

FINDINGS OF FACT

1. Petitioner was a clerk⁽¹⁾ whose duties included responsibility for the vending machines at the McLean, Virginia Main Post Office. Since 1991, he received more than 200 hours of individual training as a window clerk and vending machine technician. (Respondent's Exhibits (RX) 10, 17).

2. On the morning of April 11, 1995, Petitioner removed the money receipts from a vending machine in the post office lobby. He placed the money in a zippered bank deposit bag and deposited the bag in the customer parcel drop. This placed the funds in the adjacent room which was accessible only by Postal Service employees, but out of his sight and control. (RX 6, 10).

3. After placing the funds in the customer parcel drop, Petitioner began working on a coin jam in the vending machine. Upon completing this task, Petitioner proceeded to the adjacent room to retrieve the funds and place them in the safe assigned to Petitioner for safekeeping of vending machine funds. The bank bag, with the funds, was missing from the location where Petitioner had placed it. (Id.).

4. Petitioner immediately notified his supervisor of the loss. The supervisor, along with Petitioner and another employee, conducted a search of the entire parcel drop area, including the mail in the local and out-of-town drops. Outside collection boxes were checked and the vending machine was reopened to check inside it for the missing funds. The supervisor then contacted the Postal Inspection Service. (RX 12). The funds were never recovered.

5. Petitioner's total vending credit was audited on April 13, 1995, and was found to have a shortage of $1,253.07. Petitioner signed the audit documents. The portion of this shortage which was lost on the morning of April 11, 1995 ($1,168.00), was determined based on Petitioner's statement as to the amount recorded on the vending machine counter. (RX 6, 9, 15).

6. Postal Service Handbook PO-102, Retail Vending Operational and Marketing Program (January 30, 1990), Section 560 requires vending machine servicing personnel to keep all cash locked in a safe between servicing visits (RX-18).

DECISION

Respondent's position is that Petitioner failed to exercise reasonable care in safeguarding the Postal Service funds he removed from the vending machine and should, therefore, be liable to repay the resulting loss. Petitioner argues that Respondent was negligent in training him in the proper handling of vending machine funds and that Respondent was negligent in conducting an investigation into the loss. Petitioner further alleges that he was instructed to immediately fix jams in the vending machines and that, therefore, his actions at the time were reasonable. Finally, Petitioner argues that it was "unfair" of Respondent to conclude that $1,168.00 was lost as a result of his actions since the machine he removed the funds from had malfunctioned in the past.

The standard of liability for losses from vending machines, unlike losses from main stock or clerk credits, is a negligence standard rather than a strict liability standard. See Beverly M. Dennis, P.S. Docket No. DCA 97-107 (May 22, 1997)⁽²⁾. Thus, to the extent Petitioner was negligent in carrying out his duties with respect to servicing the vending machines, he may be held liable for resultant losses.

Such is the case in this Petition. Under section 560 of Handbook PO-102, Petitioner was instructed to keep all cash locked in a safe between servicing visits (Finding of Fact No. (FOF) 6). Petitioner had a safe assigned to him for this purpose (FOF 3). Petitioner was negligent in leaving the funds he removed from the vending machine out of his sight and unsecured while he repaired a jam in the machine, rather than taking the few moments required to first place the money in his safe.

Petitioner's argument that he lacked proper training is not supported by the record. Since 1991, he received over 200 hours of training as a window clerk and vending machine technician (FOF 1).

Equally unpersuasive is Petitioner's argument that Respondent was negligent in conducting an investigation into the loss. The record demonstrates that Petitioner's supervisor conducted a thorough search for the missing funds immediately after Petitioner notified him of the loss. (FOF 4). Petitioner has failed to explain what else Respondent should have done.

I find no merit to Petitioner's argument that he acted reasonably when he failed to safeguard a bag containing $1,168.00 in Postal Service funds while he serviced a vending machine.

Finally, although Petitioner alleges that the particular machine from which the funds were removed would malfunction on occasion, and that the amount of loss being charged against him may not be accurate, he has not offered any proof of a lesser amount. Petitioner does not dispute that some amount of money was lost. An examination by Respondent of Petitioner's vending machine established that the amount of loss was $1,168.00. An audit of Petitioner's total vending credit disclosed a shortage of $1,253.07. (FOF 5). Respondent is seeking only the $1,168.00 it believes was lost as a result of Petitioner's negligent actions on the morning of April 11, 1995. In the absence of any evidence rebutting Respondent's evidence of a $1,168.00 loss, I find that Petitioner is liable for the full amount claimed by Respondent.

Accordingly, this Petition is denied. Petitioner is liable to repay the Postal Service the $1,168.00 loss from his vending machine credit⁽⁴⁾.

William K. Mahn
Administrative Judge

1. Petitioner retired from the Postal Service on August 30, 1997.

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4. By letter dated October 6, 1997, Petitioner notified this office that Respondent had already deducted $1,168.00 from his terminal leave payment, contrary to Section 5 of the Debt Collection Act. This decision, however, has rendered moot the need to correct this action on the part of Respondent.