In the Matter of the Petition by                        )
                                                                        )
MICHAEL D. BOOK                                          )
23 Forest Glen Court                                       )
                                                                        )
             at                                                        )
                                                                        )
Reisterstown, MD 21136-1630                       )       P.S. Docket No. DCA 99-98


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

APPEARANCE FOR RESPONDENT:                 Anthony W. Franklin
                                                                         Labor Relations Specialist
                                                                         United States Postal Service
                                                                         900 E. Fayette Street, Room 403
                                                                         Baltimore, MD 21233-9401

Petitioner, Michael D. Book, filed a timely 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 March 2, 1999. The Notice advised Petitioner that he was indebted to the Postal Service in the amount of $11,096.89 resulting from a shortage in his accountability for the reserve stock at the Mount Washington Station of the Baltimore, Maryland Post Office.

A hearing was held on June 3, 1999, in Baltimore, Maryland. The Postal Service presented the testimony of two employees. Petitioner presented the testimony of five employees as well as testifying on his own behalf. In addition to the transcript of the hearing the record contains Respondent’s Exhibits R-1 through R-5, and Petitioner’s Exhibits P-1 through P-5.

1. Petitioner was a supervisor of customer services and acting manager of the Mount Washington Station of the Baltimore, Maryland Post Office. In this position he also had the responsibility of reserve stock custodian. (Respondent’s Exhibit R-1).

2. On September 6, 1996, Petitioner audited and took over responsibility for the closed out accountability of Michael Frederick, one of the former clerks at the station. The audit disclosed that Mr. Frederick’s accountability contained $20,544.55 in stamps, envelopes and cash. Petitioner immediately turned in the cash portion of Mr. Frederick’s accountability, approximately $286.00, but retained the stamp and envelope portion in his own accountability. (Transcript pages (Tr.) 79, 80; R-1).

3. Petitioner initially kept the stamp portion of Mr. Frederick’s accountability separate from the reserve stock by keeping it in the former clerk’s drawer in the clerks’ safe. However, in November of 1996, Petitioner had to give Mr. Frederick’s drawer to another clerk with a broken drawer. Because he lacked space in the safe he used for the reserve stock, he then moved a portion of Mr. Frederick’s stamp stock (approximately $11,900 of loose $.32 stamps) to a locked metal cabinet in the safe room.⁽¹⁾ (Tr. 82-86, 92; R-1)

4. A lockable metal cabinet is an approved stamp storage device, although it is considered to be the least secure of five levels of security. (Tr. 99; PE 5)

5. Petitioner attempted to requisition another safe for the Mount Washington Station, but, at the time of his attempted requisition, no safes were available (Tr. 47, 53, 86).

6. Over the next few months Petitioner issued approximately $7000 worth of Mr. Frederick’s former stamp stock to another clerk. However, the $11,900 of $.32 stamps were still present in the paper tray on January 3, 1997, Petitioner’s last day as acting manager at the station. (Tr. 84-86, 91-93, 110; R-1).

7. On January 5, 1997, Petitioner reported to Potomac, Maryland to attend a training course. However, on January 7, 1997, Petitioner was called back to the Baltimore Post Office, relieved of the position of acting manager of the Mount Washington station and placed on administrative leave. On January 10, 1997, Petitioner was reassigned to the South Station in Baltimore and instructed not to return to the Mount Washington Station unless directed to do so. (Tr. 34, 108, 109).

8. During the period of Petitioner’s involuntary absence from the station, the lock broke on the door to the room containing the locked metal cabinet and the room was left unlocked for a few days (R-1).

9. On January 28, 1997, Petitioner participated in an audit of his reserve stock accountability at the Mount Washington Station. This audit disclosed a shortage of $11,096.89 in his total accountability (reserve stock, plus Mr. Frederick’s former accountability). (Stipulation; Tr. 5, 9, 12). At the commencement of the audit, Petitioner immediately noticed that almost all of the $.32 stamps he left in the cabinet were missing (Tr. 110).

10. No effort was made to transfer Petitioner’s accountability for the reserve stock when he was removed from the Mount Washington station on January 7, 1997, until the commencement of the audit on January 28, 1997 (Tr. 109).

Petitioner does not dispute that there was an $11,096.89 shortage in his accountability at the Mount Washington Station. He argues however, that he exercised reasonable care in the performance of his duties as reserve stock custodian and that management should be held responsible for the shortage because of their failure to promptly transfer responsibility for the reserve stock once they removed him from the Mount Washington Station.

Respondent argues that there was no need to transfer responsibility for the reserve stock because the clerks at the station had adequate stock during the twenty-five day period between Petitioner’s last day at the station and the commencement of the transfer audit on January 28, 1998. Respondent further argues that Petitioner’s failure to keep all his stamp stock in the safe, as opposed to a locked cabinet, demonstrates a failure to exercise reasonable care.

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 (such as Petitioner) "are held strictly accountable for any loss unless evidence establishes that they followed postal procedures established when performing their duties." Postal Service Handbook F-1, Post Office Accounting Procedures (November 1996), Section 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 act of dereliction, or act of negligence, by Petitioner. In this case, a loss of $11, 096.89 has been established by stipulation of the parties (Finding of Fact No. (FOF) 9). The burden, therefore, shifts to Petitioner to show that he followed established procedures, or to present other evidence that would warrant relieving him of liability.

Petitioner has met that burden in this proceeding. The evidence demonstrates that Petitioner followed Postal Service policies and procedures and exercised reasonable care in protecting his accountability for both the reserve stock and Mr. Frederick’s former accountability. When it was evident that the safe assigned to him to safeguard his accountability was no longer adequate to contain the reserve stock as well as Mr. Frederick’s stamp stock, Petitioner attempted to requisition another safe. He was informed however, that no safes were available. (FOF 4). Lacking sufficient space in his reserve stock safe (and there no evidence that there was space in any other container of comparable security), Petitioner did the next best thing and secured Mr. Frederick’s stamp stock in a locked cabinet in a room accessible only to himself and the station’s window clerks (FOF 3).

Accordingly, Petitioner is not liable to repay the loss of $11,096.89 and the Petition is sustained.

William K. Mahn
Administrative Judge

1. Petitioner had the only keys to this locked cabinet. The cabinet itself was located in a locked room that contained the reserve stock safe and the window clerks' safe and was accessible to only Petitioner and the window clerks (Tr. 110, 111).