Appeal of
LARRY J. MILLER
Under Contract No. HCR 93546
PSBCA No. 3632

APPEARANCE FOR APPELLANT:
Larry J. Miller

APPEARANCE FOR RESPONDENT:
Robyn M. A. Sembenini, Esq.

OPINION OF THE BOARD

            Respondent, United States Postal Service, terminated a mail delivery contract held by Appellant, Larry J. Miller, after discovering that Appellant had discarded mail.  Appellant appealed the termination, and requested that the appeal be processed under the Board's Accelerated procedure.  However, Appellant included in his complaint a claim for money damages in excess of $50,000, and the request for accelerated treatment was denied in the Board's Order of April 20, 1994.

            At the election of the parties, the appeal is being decided on the record without an oral hearing, pursuant to 39 C.F.R. § 955.12.

FINDINGS OF FACT

            1.  On May 15, 1990, Respondent renewed contract HCR 93546 with Appellant for mail box delivery service along a route originating at the Caliente, California, Post Office for the term July 1, 1990, through June 30, 1994 (Appeal File Tabs ("AF") 1, 2).

            2.  The contract required Appellant to "carry all mail tendered for transportation under this contract, whatever may be its size and weight, with certainty, celerity, and security," to "[d]eposit all mail matter received for that purpose from a post office into the appropriate mail boxes of patrons placed along the line of the route," and to "protect the mail from loss, depredation, or damage."  (AF 1, Contract Section 13.E.; AF 2, Basic Surface Transportation Services Contract General Provisions, PS Form 7407T, March 1989 ("GP") 4 (a), (b)(1)i, and (c)).  Appellant was accountable for "loss, rifling, damage, wrong delivery, depredation upon, and other mistreatment of mail . . . ."  (AF 2, GP 8(c)).

            3.  The contract provided that the contracting officer could terminate the contract for default under the following circumstances:

"(1) For Contractor's failure to perform service according to the terms of the contract;

(2) If the Contractor is the subject of administratively determined violations of the Postal laws and regulations and other laws related to the performance of the service;

***

(6) For the Contractor's failure properly to account, deliver and pay over moneys, mail and other property pursuant to Clause 8 of this contract.

(7)  If the Contractor . . . is not reliable, trustworthy or of good character."  (AF 2, GP 16 (a)(1), (2), (6), (7)(c)).

            4.  If Appellant had extra pieces of "occupant" or "boxholder" advertising mail remaining after delivering one to each customer on his route, he was required under his contract to return the extras to the Caliente Post Office (AF 16, 21).[1]

            5.  On February 8, 1994, 97 pieces of a Carol Wright coupon mailing for delivery to customers on Appellant's route were found in a trash receptacle just outside Caliente.  The Caliente Postmaster reported the discovery to the Postal Inspection Service.  (Complaint; AF 16, 21).

            6.  On February 11, 1994, a postal inspector interviewed Appellant regarding the discarded mail.  The postal inspector gave Appellant the Miranda warnings and told him that he would not be arrested or fired if he cooperated and answered questions truthfully (Complaint; Answer).  Appellant cooperated with the investigation (id.).  Appellant initially denied discarding any mail, asserting that he had had just enough of the Carol Wright pieces for his route on February 8.  When the inspector mentioned the possibility of examining the discarded mail for fingerprints, Appellant admitted he had discarded approximately 50 pieces of the Carol Wright mailing in the trash on February 8, but he claimed that each of his customers had received one and that those he discarded were extras.  (AF 16, 21).

            7.  Appellant knew that discarding the mail as he did violated Postal Service requirements (AF 16, 21).

            8.  The postal inspector prepared an Investigative Memorandum that recounted the results of his investigation and included a copy of a written statement given by Appellant during the interview.  A copy of the Investigative Memorandum was sent to the postmaster who sent a copy to the contracting officer.  (AF 16, 17; Declaration of Ty Walker dated August 19, 1994).

            9.  After receipt of the Investigative Memorandum, the contracting officer, on March 4, 1994, terminated Appellant's contract for default effective March 8, 1994.  In his final decision, the contracting officer cited General Provisions 16(a)(2) and (6) and stated the reason for the termination was "violation of Postal laws and regulations and mishandling the mail."  (AF 19).  The sole reason for the termination was Appellant's improper disposal of mail (Declaration of Ty Walker dated August 19, 1994).  Appellant appealed the termination.

            10.  After the termination, a large number of customers from Appellant's route signed petitions and wrote letters to the post office and to local newspapers objecting to Appellant's termination.  Some of the customers stated that the discarded mail was mail they were not interested in receiving.  (Attachments to Complaint).

            11.  Approximately a year and one half before Appellant's contract was terminated, he had filed a complaint of sexual harassment against the Caliente Postmaster.  Respondent had investigated the complaint but had taken no action.  (AF 21).

            12.  Respondent included in its complaint a counterclaim for $5,610 in damages against Appellant for costs incurred in replacing Appellant with another contractor after the termination.

DECISION

            Appellant admits discarding the advertising mail on February 8, but contends his actions do not warrant termination of the contract.  He argues that the reason he discarded the mail was that he feared the postmaster would be angry and accuse him of not delivering all of the mail if he returned to the post office with so many extra pieces.  He asserts that in the past, with the knowledge of postal clerks, he had discarded extra advertising mail after he returned to the post office, and that his actions on February 8 were little different.  Appellant also contends his termination was improper because it violated the promise made by the postal inspector who interviewed him on February 11, 1994, that Appellant would not be arrested or fired if he told the truth and cooperated.  Finally, Appellant argues that the termination was the culmination of a campaign of harassment by the Caliente Postmaster to get Appellant fired in retaliation for his filing of a sexual harassment complaint against her in the past, and that her report of the discarded mail to the Postal Inspection Service instead of handling it locally is evidence of her intent to harm him.

            Respondent contends that the decision to terminate Appellant's contract was solely the contracting officer's and was justified by the information in the Investigative Memorandum that Appellant had discarded mail in the trash.  Additionally, Respondent argues that Appellant's disposal of mail was not excused by his alleged fear of returning to the post office with extra pieces of advertising mail, the alleged harassment by the postmaster, prior instances of disposal of similar mail with the knowledge of postal clerks or representations made by postal inspectors during their interview with Appellant.  Finally, Respondent argues that the customers' petitions and letters supporting Appellant are irrelevant and do not warrant setting aside the termination for default.

            The Postal Service has the burden of proving that the termination was justified, but once Respondent shows that Appellant failed to perform as required by the contract, the burden shifts to Appellant to present evidence of excusable causes, Patricia J. Stevens, PSBCA No. 3272, 94-1 BCA ¶ 26,419; Pamela J. Sutton, PSBCA No. 1622, 88-3 BCA ¶ 21,031, or to show the termination was an abuse of the contracting officer's discretion, Jesse A. Farmer, PSBCA No. 2702, 91-3 BCA ¶ 24,181; Quality Environment Systems, Inc., ASBCA No. 22178, 87-3 BCA ¶ 20,060 at 101,569.

            Appellant's disposal of the extra advertising mail on February 8 violated his contractual duties.  Although the contract did not state explicitly that extra advertising mail was to be returned to the Caliente Post Office, both parties understood that Appellant was required to do so.  In any event, there is nothing in the contract that could be read or understood to authorize Appellant to discard any mail in trash bins before returning to the post office.  His actions on February 8, therefore, were serious, knowing violations of Postal Service delivery requirements that he was required to follow under his contract, and, unless Appellant can demonstrate his disposal of mail was excusable, termination of his contract was warranted.  See Francis E. Fekkers, PSBCA No. 1259, 84-3 BCA ¶ 17,557; Larry J. Bunker, PSBCA No. 1067, 83-1 BCA ¶ 16,542.

            Appellant has not established that his prior disposal of advertising mail excused his actions on February 8.  The evidence did not show that any prior instances where Appellant disposed of extra mail after returning to the post office were comparable to Appellant's actions on February 8 or that such disposal was permitted by Respondent.  Postal Service clerks that he alleges knew of his previous actions were not authorized to allow him to dispose of mail contrary to Postal Service regulations.  See Bonnie Dolin, PSBCA No. 2394, 92-2 BCA ¶ 25,014.  Moreover, regardless of any past practice, Appellant knew discarding the mail in the trash on February 8 violated Postal Service delivery requirements.  That the discarded mail had little intrinsic value or may have been the type of mail some customers cared little about receiving is of no moment.  See Richard Lewis Danel, PSBCA No. 3470, 94-2 BCA ¶ 26,687; Francis E. Fekkers, PSBCA No. 1259, 84-3 BCA ¶ 17,557 at 87,476.

            Any representations made by the postal inspectors who interviewed Appellant that he would not be fired if he cooperated and told the truth do not preclude the contracting officer from terminating Appellant's contract.  The contract authorizes the contracting officer to terminate a mail delivery contract for a contractor's mistreatment of mail, and the postal inspectors do not have authority to commit the contracting officer to refrain from acting on information of a contract violation and to overlook Appellant's discarding the mail.  See Sharon Rhoades, PSBCA No. 3455, 94-2 BCA ¶ 26,950; Bonnie Dolin, PSBCA No. 2394, 92-2 BCA ¶ 25,014; F&B Realty, PSBCA No. 2529, 91-2 BCA ¶ 23,788 at 19,142.

            Also, there is ample evidence in the record, in addition to Appellant's statement to the postal inspectors, to demonstrate that he discarded the advertising mail in the trash on February 8.  The Investigative Memorandum, to which Appellant has not objected, reports that the mail was found in the trash and that it was mail for customers on Appellant's route.  In correspondence with Respondent after the termination, Appellant admitted discarding the mail and that he knew it violated his duties under the contract.  In this proceeding, Appellant has not denied discarding the mail.  Therefore, even if Appellant could point to authority that would require suppression of his statement to the postal inspectors, Respondent has established that Appellant discarded the advertising mail.

            Appellant has not demonstrated that the termination resulted from the malicious actions of the postmaster.  Her report to the Inspection Service of the mail discovered in the trash was proper.  The Inspection Service is responsible for investigating violations of laws relating to protection of mail, 39 C.F.R. § 224.3 (b), and reporting an incident of possibly unlawful disposal of mail to the Inspection Service was appropriate.  Likewise, the postmaster's transmittal of the Inspection Service report to the contracting officer was appropriate, as the contracting officer is the representative of Respondent authorized to take contractual actions with respect to Appellant's contract.  Appellant cited a number of instances of the postmaster's conduct he considered to constitute harassment, but even if he had shown the postmaster to have acted as he alleged, Appellant has not demonstrated that those actions had a bearing on his termination or that they justified discarding the mail.  See Karen L. Wilson, PSBCA No. 1494, 86-3 BCA ¶ 19,256; Francis E. Fekkers, PSBCA No. 1259, 84-3 BCA ¶ 17,557.

            Appellant has not shown that the decision to terminate his contract constituted an abuse of the contracting officer's discretion, or that for any other reason the termination was improper.

            We do not have jurisdiction over Respondent's counterclaim for reprocurement costs because there is no evidence the contracting officer has issued a final decision asserting a Postal Service claim against Appellant followed by an appeal of the decision.  See 41 U.S.C. §605(a); Sharman Co. v. United States, 2 F.3d 1564, 1568-69 (Fed. Cir. 1993); Sharon Rhoades, PSBCA No. 3455, 94-2 BCA ¶ 26,950; East-Wind Indus., Inc., ASBCA No. 25684, 86-1 BCA ¶ 18,698; Victoria Trading, ASBCA No. 29006, 85-3 BCA ¶ 18,474 at 92,799.

            The appeal is denied.  Respondent's counterclaim is dismissed without prejudice.

Norman D. Menegat
Administrative Judge
Board Member

I concur:
James A. Cohen
Administrative Judge
Chairman

I concur:
James D. Finn, Jr.
Administrative Judge
Vice Chairman

[1]  Sections 332.1 and 332.2 of Postal Service Handbook PO-504, Highway Contract Routes--Box Delivery Service, March 1, 1989, specifically provide that undeliverable or extra "boxholder" advertising mail is to be returned to the post office.  Handbook PO-504 was not placed in the record by either party, but Appellant has admitted he understood that under his contract any extra pieces of an advertising mailing were to be returned to the post office.  (AF 16, 21).