In the Matter of the Petition by                               )
                                                                              )
MICHAEL J. MASSIE                                              )
57 Hooper Street                                                   )
                                                                              )
               at                                                            )
                                                                              ) 
Port Jefferson Station, NY 11776-3803                )    P.S. Docket No. DCA 98-357

APPEARANCE FOR PETITIONER:                           Charles Scialla
                                                                               453 Preakness Avenue, #5
                                                                               Paterson, NJ 07502-1121

APPEARANCE FOR RESPONDENT:                        Charles Spina
                                                                               Labor Relations Specialist
                                                                               United States Postal Service
                                                                               P.O. Box 7401
                                                                               Hauppauge, NY 11760-9401

FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982

Petitioner, Michael J. Massie, filed a 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 June 25, 1998. The Notice advised Petitioner that he was indebted to the Postal Service in the amount of $1,052.82 resulting from a shortage in his accountability for the Main Stock^1/ at the South Branch office of the Farmingdale, New York Post Office.

A hearing was held on October 20, 1998, in Farmingdale, NY. The Postal Service presented the testimony of four employees. Petitioner presented the testimony of three additional employees, and Petitioner testified on his own behalf. In addition to the transcript of the hearing, the record also contains Respondent's Exhibits R-1 through R-10, and Petitioner's Exhibits P-1 through P-13.

FINDINGS OF FACT

1. Petitioner is a supervisor of customer services in the Farmingdale, NY Post Office (Petitioner's Exhibit P-1). He assumed responsibility for the reserve stock of the South Branch office of the Farmingdale Post Office in September of 1996 (Transcript pages (Tr.) 11, 110).

2. There is no formal training provided by the Postal Service for stamp stock custodians (Tr. 60, 91). However, prior to assuming this responsibility, he received two days of training as a stamp stock custodian at the Ronkonkoma, NY Post Office, as well as receiving "on-the-job" training by working with the main stock custodian at the Farmingdale Post Office (Tr. 11, 12).

3. On October 3, 1996, Petitioner issued stamps to Nate Chaimowitz, a window clerk at the South Branch. Shortly after issuing the stamps, Petitioner became concerned that he had issued 5000 "flag over porch" $.32 stamps, and that Mr. Chaimowitz had mistakenly acknowledged receipt of only 500 of these $.32 stamps. Petitioner discussed this matter with Mary Falcone who was another employee in the Farmingdale Post Office and then called Mr. Chaimowitz to ask whether he had mistakenly issued 5000 "flag over porch" $.32 stamps instead of 500 stamps. Mr. Chaimowitz denied receiving 5000 "flag over porch" $.32 stamps. (Tr. 111-113, 117, 118; P-12).

4. On December 3, 1996, Petitioner informed Sal Modena, the main stock custodian, that Petitioner's Integrated Retail Terminal (IRT) indicated that he had an apparent $96 overage in his accountability (Tr. 13, 14, 28, 29). The Postmaster overheard this discussion and directed Mr. Modena to investigate the cause of the $96 discrepancy in Petitioner's accountability. (Tr. 13, 14, 61).

5. This investigation disclosed that on October 3, 1996, Petitioner may have made two errors while issuing stamps to Mr. Chaimowitz. Petitioner's Form 17 memorializing the transaction indicated he had issued 300 self-stick $.32 "Christmas" stamps on sheets, for a total value of $96.00. However, at that time, October of 1996, those stamps were issued in book form, not on sheets. Therefore, this entry could not have been correct. Mr. Modena also noted that there may have been a problem with the "flag over porch" $.32 stamps because the quantity issued, originally indicated to be 5000, was crossed out and changed to 500. These two discrepancies led Mr. Modena to conclude that further investigation was necessary. (Tr. 14, 15).

6. Thereafter, a December 10, 1996 audit of Mr. Chaimowitz's stamp stock disclosed that he had an overage of $2,371.18 in his accountability (Tr. 21, 63; Respondent's Exhibit R-6).

7. An audit of Petitioner's stamp stock on December 11, 1996, disclosed a total shortage of $3,520.00 in Petitioner's accountability. Petitioner was short $1,920 in Christmas stamps, $1,440 in "flag over porch" stamps and was missing a $160 coil of stamps. Petitioner signed the audit documents, thereby indicating his agreement with the accuracy of the audit's findings. (Tr. 63, 64, 72, 73; R-7, R-10).

8. The Postmaster determined that a sufficient correlation existed between the overage found in Mr. Chaimowitz's accountability and the shortage in Petitioner's accountability to allow him to credit Petitioner's indebtedness with the $2,371.18 overage. The Postmaster, therefore, reduced the amount sought from Petitioner to $1,052.82 and, on June 25, 1998, issued Petitioner a Notice of Involuntary Administrative Salary Offsets seeking to recover that amount from Petitioner^2/. (Tr. 64, 65; P-1).

DECISION

Respondent argues that the evidence demonstrates there was a loss to the Postal Service in the amount of $1,052.82 resulting from a shortage in the unit reserve at the South Branch office of the Farmingdale Post Office while the stock was under Petitioner's responsibility. Respondent further argues that the Postmaster acted promptly to investigate the shortage and that Petitioner received appropriate training before assuming the responsibility of stamp stock custodian.

Petitioner contends that his training for the responsibility of stamp stock custodian was inadequate. He further argues that Postal Service officials failed to act promptly to investigate a possible mistake he made in issuing stamps on

October 3, 1996, and that, had they acted promptly, the loss would not have occurred.

The applicable standard of liability in this dispute can be found in Subsection 132, Other Employees, of Handbook F-1, Post Office Accounting Procedures.^3/ This section provides that employees who are assigned responsibility for postal funds and other accountable paper will be held strictly liable for any loss unless they can demonstrate that they exercised reasonable care in the performance of their duties. To establish a prima facie case, the Postal Service must only prove that a loss occurred and that Petitioner was accountable for the stock from which the loss occurred. Respondent is not required to prove any negligence or dereliction on the part of Petitioner. Thereafter, Petitioner is required to demonstrate that he exercised reasonable care. In this case, Respondent has met its burden.

When an audit shows a shortage relative to a previously established balance, this constitutes proof of a loss unless other evidence raises sufficient doubt about the accuracy of the audit. See Alma Souice-Williams, P.S. Docket No. DCA 97-176 (November 4, 1997). Petitioner does not dispute the accuracy of the audit.

Petitioner has failed to establish that Respondent neglected to promptly investigate the cause of his shortage. Although there is conflicting testimony concerning whether Petitioner notified his Postmaster on October 3, 1996, of a possible mistake he made on that date while issuing stamps to Nate Chaimowitz, a

preponderance of evidence supports the conclusion that December 3 was the first time the Postmaster learned of a possible discrepancy in Petitioner's accountability^4/ (See Finding of Fact No. (FOF) 4). Thereafter, the Postmaster acted promptly to investigate and correct the problem.

Likewise, Petitioner has failed to establish that the Postal Service did not provide adequate training before assigning him the responsibility of stamp stock custodian. Before assuming the duties of stamp stock custodian, Petitioner received training both at the Ronkonkoma Post Office, as well as "on-the-job" training with the main stock custodian at the Farmingdale Post Office (FOF 2).

Finally, Petitioner has offered no evidence to demonstrate that he exercised reasonable care in the performance of his duties. Accordingly, I find Petitioner liable for repaying $1,052.82 to the Postal Service.

The Petition is denied.

William K. Mahn
Administrative Judge

_________________________

1. The stamp stock at the South Branch office is technically referred to as a "unit reserve" (Transcript page (Tr.) 82).

2. The $3,520.00 shortage in Petitioner's accountability reduced by the $2,371.18 overage in Mr. Chaimowitz's accountability equals $1,148.82, --- not $1,052.82. Although not explained anywhere in the record, it is likely that the Postmaster also credited Petitioner with the apparent $96.00 overage he initially believed he had in his accountability when he discussed the issue with Mr. Modena on December 3, 1996 (See Finding of Fact No. 4).

3. The F-1 Handbook was revised effective November 1996. However, because the loss herein most likely arose before then, the April 1991 edition applies. References in this decision to the F-1 Handbook are to the 1991 edition.

4. Three witnesses testified that Petitioner did not alert his superiors on October 3, 1996, concerning possible mistakes made when issuing stamps to Nate Chaimowitz and that December 3 was the first time any of Petitioner's superiors became aware of possible problems (Tr. 37, 38, 60, 75, 106). On the other hand, although insisting that he did notify the Postmaster of a problem on October 3, Petitioner could supply few details of how or when he actually notified his superiors (Tr. 125, 126).