IN THE CASE OF:	  

		BOARD DATE:	  6 March 2012

		DOCKET NUMBER:  AR20110002991 


THE BOARD CONSIDERED THE FOLLOWING EVIDENCE:

1.  Application for correction of military records (with supporting documents provided, if any).

2.  Military Personnel Records and advisory opinions (if any).


THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests, in effect, relief of financial liability imposed against him in the Financial Liability Investigation of Property Loss (FLIPL), #10-xxx-03, initiated on 28 July 2009.

2.  The applicant states:

* the FLIPL is legally insufficient as it did not establish that he was responsible, culpable, or that his actions were the proximate cause of the loss under Army Regulation 735-5 (Policies and Procedures for Property Accountability)
* he was made to sign for the property of three units after the incumbent supply sergeant retired
* he did as he was requested, then found some property to be missing

3.  The applicant provides a FLIPL packet.

CONSIDERATION OF EVIDENCE:

1.  The applicant is a Georgia Army National Guard (GAARNG) Sergeant First Class (SFC/E-7).  In November 2007, he was assigned to the 874th Engineer Company, a subordinate unit of the 878th Engineer Battalion.  He was assigned as a Platoon Sergeant and Readiness Noncommissioned Officer (NCO).  The parent unit was in a state of transition as subordinate units were being activated and inactivated.

2.  The supply sergeant for the parent unit was being retired based on her mandatory removal date.  The applicant was directed to sign for unit property until a replacement supply sergeant could be assigned.  He did so, becoming responsible for the property books of the 874th and the 75th Engineer Companies.  He initiated an inventory, but because the supply sergeant was already retired, it was not a joint inventory.  He immediately found some discrepancies.

3.  In January 2008, a new supply sergeant was assigned and a new inventory was begun.  The new supply sergeant discovered missing protective masks and a missing Survey Set.  He informed the applicant, who said he already knew of the protective mask issue, but didn't know anything about the Survey Set.  Both individuals conducted a thorough search, but could not account for the missing items.  

4.  Following a considerable delay, a FLIPL investigation was ordered and a major was appointed as the investigating officer (IO) on 14 December 2009.  The IO completed his investigation on or about 11 August 2010.  The IO concluded:

After careful evaluation and review of the evidence…it is my belief that the [missing items] were lost as a result of improper inventory on the part of the 874th supply sergeant and the past practices going back years. I, investigating officer, has [sic] not been given any documentation showing the M40 Mask was apart [sic] of the 75th EN DET [Engineer Detachment] property book and is missing.  Records show that during an inspection, by the 874th EN TM [Engineer Team], the Surveying Equipment was part of that Units [sic] property book.  874th…AGR [Active Guard Reserve] personnel made several attempts to locate the Surveying [sic] by searching throughout FT Stewart NGTC [National Guard Training Center].  Past practices have been that both military and civilian personnel would borrow equipment from the unit without a hand receipt. Knowing this, the supply sergeants would wait in anticipation for the return of that equipment.  Since then, measures have been taken to properly account for equipment through the use of hand receipts.

Below are findings which helped me form my decision:

* 20071114 – 874th EN TM Organization Property Book (Hand Receipt)
   does not show Survey Equipment



* 20071204 – 75 EN DET Organization Property Book (Hand Receipt)
is showing the Survey Equipment On-Hand

* 20071212 – DA Form 3161 – Request for Issue or Turn-in
DA Form shows [former supply sergeant] turned-in Survey Equipment
from the 75th EN DET and (issue-to) the 874th.

* 20080429 – 874th EN TM Organization Property Book (Hand Receipt)
is showing Survey Equipment On-Hand

Recommendation:  That [applicant] be held liable for only a third of the loss for improperly inventorying [sic] the equipment.  Along with the past practices, the amount should be at a minimum (1/3 base pay).  Reason is, his actions derive from past guidance and actions from their leadership.  [Former Supply Sergeant] should not be held responsible for any actions.  Records show [she] transferred the equipment and there wasn't a representative from the 874th to receive them.

5.  After calculating equipment depreciation of 25%, the FLIPL IO established the value of the loss at $41,625 and determined the applicant should be charged 1/3 of his base pay, or $1,427.80 for his role in the loss of Government property.

6.  The FLIPL was completed and the applicant was notified on 6 August 2010 he was being recommended for charges of financial liability in the amount of $1,427.80.  He acknowledged notification and submitted a rebuttal.

7.  On 20 August 2010, a legal review found the FLIPL to be legally sufficient.  On 24 August 2010, the applicant was notified an approved charge of financial liability had been approved against him.

8.  On 29 October 2010, the applicant requested reconsideration of the approved charge of financial liability.  He stated although he may have been responsible for the property by virtue of having signed the hand receipts for several units in an effort to assist the command during unit turbulence his actions/inactions were not the proximate cause of the loss.

9.  On 10 November 2010, the applicant's request for reconsideration was denied.



10.  In the processing of this case, an advisory opinion was obtained from the Chief, Personnel Policy Division, National Guard Bureau (NGB).  The advisory official recommended approval of the applicant's request for relief from financial liability stating:

* the applicant should not be held financially liable
* the former supply sergeant did not affect proper transfer of accountability  or conduct a joint inventory prior to retirement
* the FLIPL investigation was deficient in establishing responsibility, culpability, proximate cause, and loss
* the IO stated the former supply sergeant was responsible due to "improper inventory" and "past practices going back years"
* the IO further stated "the failure to conduct a proper inventory lies on the command and not an individual"
* under Army Regulation 735-5, chapter 13-28, the applicant cannot be the proximate cause of the loss because after signing for the property, he did everything he could to locate and account for the property

11.  The applicant was furnished a copy of the advisory opinion for information and to allow him the opportunity to submit comments or a rebuttal.  On 11 January 2012, he concurred with the advisory opinion.

12.  Army Regulation 735-5 (Policies and Procedures for Property Accountability) prescribes the basic policies and procedures in accounting for Army property and sets the requirement for formal property accounting within the Army.  It implements specific property accounting procedures; defines accountability and responsibility; identifies the categories of property and the accounting procedures to be used with each; and identifies the basic procedures for operating a property account.  The regulation also prescribes the accounting procedures to be used when Department of the Army (DA) property is discovered lost, damaged, or destroyed through causes other than fair wear and tear.  It provides authorized methods to obtain relief from property responsibility and accountability.  It also prescribes the DA policy on such losses and financial liability.  Army Regulation 735-5, chapter 13, details the FLIPL process and states the Government may impose a finding of pecuniary liability whenever negligence or willful misconduct is found to be the proximate cause of any loss, damage, or destruction of Government property.

13.  Army Regulation 735-5, chapter 13, states that a FLIPL documents the circumstances concerning the loss, damage, or destruction (LDD) of Government property and serves as, or supports, a voucher for adjusting the property from accountable records.  It also documents a charge of financial liability assessed against an individual or entity, or provides for the relief from financial liability.  Chapter 13 also states:

	a.  FLIPL are initiated and processed within a specific number of days, following the discovery of the LDD of U.S. Government property.  When delayed beyond the prescribed processing times, the person responsible for the delay will prepare a written statement explaining the reason for the delay and attach it to the FLIPL as an exhibit.  

	b.  The initiator of a FLIPL will normally be the hand receipt (HR) holder or the accountable officer.  When the HR holder or the accountable officer is not available, the person with the most knowledge of the incident will serve as the initiator.

	c.  The approving authority is defined as an Army officer, or DA civilian employee authorized to appoint a financial liability officer and to approve the FLIPL.  For Army garrisons, garrison commanders will be the approving authority for a FLIPL arising within their command or under their supervision.

	d.  Before a person can be held financially liable, the facts must show that he/she, through negligence or willful misconduct, violated a particular duty involving the care of the property.  It also states, in effect, that before holding a person financially liable for a loss to the Government, the facts must clearly show that the person's conduct was the "proximate" cause of the loss.  That is, the person's acts or omissions were the cause that produced the loss and without which the loss would not have occurred.

14.  Army Regulation 735-5, chapter 13, states that the Government may impose a finding of pecuniary liability whenever negligence or willful misconduct is found to be the proximate cause of any loss, damage or destruction of Government property.  The total amount of pecuniary liability for Soldiers will be established as the equivalent of 1 month’s basic pay at the time of the loss, or the actual amount of the loss to the Government, whichever is the lesser amount.  Civilian employees’ maximum exposure is 1/12 of their annual salary.  Proximate cause is defined as a cause which, in a natural and continuous sequence, unbroken by a new cause, produced loss or damage and, without which, loss or damage would not have occurred.

15.  The Consolidated Glossary for Army Regulation 735-5 defines negligence as simple or gross, with simple negligence being the failure to act as a reasonably prudent person would have acted under similar circumstances.  Gross negligence is defined as an extreme departure from the course of action to be expected of a reasonably prudent person, all circumstances being considered, and accompanied by a reckless, deliberate, or wanton disregard for the foreseeable consequences of the act.  Willful misconduct is defined as any intentionally wrongful or unlawful act dealing with the property concerned.  Proximate cause is defined as a cause which, in a natural and continuous sequence, unbroken by a new cause, produced loss or damage and, without which, loss or damage would not have occurred.

16.  The glossary also defines responsibility.  Responsibility is the obligation of an individual to ensure Government property and funds entrusted to his or her possession, command, or supervision are properly used and cared for and that proper custody and safekeeping are provided.  There are five types of responsibility:

	a.  Command responsibility is the obligation of a commander to ensure all Government property within his or her command is properly used and cared for, and that proper custody and safekeeping of Government property are provided.  Command responsibility is inherent in command and cannot be delegated.  It is evidenced by assignment to a command position at any level and includes:
ensuring the security of all property of the command, whether in used or in storage. 

* observing subordinates to ensure their activities contribute to the proper custody, care, use, and safekeeping of all property within the command
* enforcing all security, safety, and accounting requirements
* when necessary, taking administrative or disciplinary measures

	b.  Supervisory responsibility is the obligation of a supervisor to ensure all Government property issued to, or used by, his or her subordinates is properly used and cared for, and that proper custody and safekeeping of the property are provided.  It is inherent in all supervisory positions and is not contingent upon signed receipts or responsibility statements.  It arises because of assignment to a specific position and includes:

* providing proper guidance and direction
* enforcing all security, safety, and accounting requirements
* maintaining a supervisory climate that will facilitate and ensure the proper care and use of Government property

	c.  Direct responsibility is the obligation of a person to ensure all Government property for which he or she has receipted, is properly used and cared for, and that proper custody and safekeeping are provided.  Direct responsibility results from assignment as an accountable officer, receipt of formal written delegation, or acceptance of the property on HR from an accountable officer.  Commanders and/or supervisors will determine and assign, in writing, the individuals who will have direct responsibility for property.

	d.  Custodial responsibility is the obligation of an individual for property in storage awaiting issue or turn-in to exercise reasonable and prudent actions to properly care for, and ensure proper custody and safekeeping of the property are provided.  Custodial responsibility results from assignment as a supply sergeant, supply custodian, supply clerk, or warehouse person who is rated by and answerable directly to the accountable officer or the individual having direct responsibility for the property.  Responsibilities include:

* ensuring the security of all property stored within the supply room and storage annexes belonging to the supply room or "SSA" is adequate
* observing subordinates to ensure their activities contribute to the proper custody, care, and safekeeping of all property within the supply room and storage annexes belonging to the supply room or "SSA"
* enforcing all security, safety, and accounting requirements
* when unable to enforce any of these, reporting the problem(s) to their immediate supervisor

	e.  Personal responsibility is the obligation of a person to exercise reasonable and prudent actions to properly use, care for, and safeguard all Government property in their possession.  It applies to all Government property issued for, acquired for, or converted to a person's exclusive use, with or without receipt.

DISCUSSION AND CONCLUSIONS:

1.  The applicant seeks relief from financial liability imposed against him by FLIPL #10-xxx-03.

2.  The applicant signed an HR at Fort Stewart in November 2007 accepting responsibility for, among other items:

* M40 Protective Masks

* Survey Instrument, Electric  RICC 2

3.  Only HR documents showed the items to be present – a physical joint inventory was never conducted between the applicant and the retiring supply sergeant.  Only after the supply sergeant retired and a new supply sergeant was assigned was it determined the Survey Instrument was not present.

4.  Army Regulation 735-5 states that in order to assess liability, the approving authority must find the person to be held liable had a duty/responsibility to take care of the property; the person failed to carry-out that duty (negligence); and the person's failure led to the loss (proximate cause).

5.  The advisory opinion clearly states the FLIPL and the IO's investigation did not establish the applicant's liability.  In fact the IO established the former Supply Sergeant's negligence as the proximate cause of the loss and laid loss of accountability on the commander for not exercising good supply discipline.

6.  The IO's investigation was deficient and the FLIPL is fatally flawed.  The applicant's negligence was never established, nor were his acts or omissions established as the proximate cause of the loss.  In view of the foregoing, the applicant is entitled to the relief as outlined below.

BOARD VOTE:

___x____  ____x___  ___x____  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The Board determined that the evidence presented was sufficient to warrant a recommendation for relief.  As a result, the Board recommends that all DA records of the individual concerned be corrected by:

	a.  showing he was not held financially liable by FLIPL #10-xxx-03, initiated on 28 July 2009; and 

	b.  refunding him any monies already collected as a result of the FLIPL.



      _______ _   _x______   ___
       	   CHAIRPERSON
      
I certify that herein is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in this case.
ABCMR Record of Proceedings (cont)                                         AR20110002991



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ABCMR Record of Proceedings (cont)                                         AR20110002991



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