Castella v. Long

• Decision Date: 29 April 1988
• Docket Number: Civ. A. No. 3-87-1141-H.
• Citation: 701 F. Supp. 578
• Parties: John Fred CASTELLA, Plaintiff, v. John Edward LONG, Personally and in his official capacity as Commander, Harold D. Lynch, Personally and in his official capacity as Senior Management Official, Army and Air Force Exchange Service, the United States Dept. of Army and the United States of America, Defendants.
• Court: U.S. District Court — Northern District of Texas

701 F. Supp. 578

John Fred CASTELLA, Plaintiff, v. John Edward LONG, Personally and in his official capacity as Commander, Harold D. Lynch, Personally and in his official capacity as Senior Management Official, Army and Air Force Exchange Service, the United States Dept. of Army and the United States of America, Defendants.

Civ. A. No. 3-87-1141-H.

United States District Court, N.D. Texas, Dallas Division.

April 29, 1988.

Joshua Turin, Cazorla Bates & Turin, Dallas, Tex., for plaintiff.

Marvin Collins, U.S. Atty., Stafford Hutchinson, Asst. U.S. Atty., Dallas, Tex., Captain Richard O. Hatch, Office of the Judge Advocate General, Dept. of the Army, Washington, D.C., for defendants.

MEMORANDUM OPINION AND ORDER

SANDERS, District Judge.

Before the Court are Defendants' Partial Motion to Dismiss the Complaint, filed September 15, 1987; Plaintiff's Response, filed December 3, 1987; Defendants' Reply, filed January 15, 1988; Individual Defendants' Separate Motion to Dismiss, or alternatively, for Summary Judgment, filed September 15, 1987; Plaintiff's Response, filed December 7, 1987; Defendants' Reply, filed January 13, 1988; Individual Defendants' Statement of Undisputed Facts and Issues of Law, filed September 15, 1987; Plaintiff's Response to Individual Defendants' Statement of Facts and Law, filed November 5, 1987; Plaintiff's Cross-Motion for Summary Judgment as to Count Six, filed December 3, 1987; Defendants' Response, filed January 22, 1988; Plaintiff's Reply, filed February 1, 1988; Plaintiff's Statement of Undisputed Facts and Issues of Law, filed December 3, 1987; Defendants' Response to Plaintiff's Statement of Facts and Law, filed January 22, 1988; Defendants' Motion for Summary Judgment as to Count Seven, filed March 4, 1988; Plaintiff's Response, filed March 25, 1988; Defendants' List of Undisputed Facts and Issues of Law, filed March 4, 1988; Plaintiff's Cross-Motion for Summary Judgment as to Count Seven, filed March 4, 1988; Defendants' Response, filed March 25, 1988; Plaintiff's Reply, filed April 1, 1988; Plaintiff's Statement of Undisputed Facts and Issues of Law, filed March 4, 1988; Defendants' Response to Plaintiff's Statement of Facts and Law, filed March 25, 1988; and last, but certainly not least, 17 Volumes of the Administrative Record for the Administrative Proceedings pertinent to this case, filed September 15, 1987.

In their various Motions, Defendants are seeking Dismissal for lack of subject matter jurisdiction and for failure to state a claim upon which relief can be granted. Dismissal for failure to state a claim can be granted only when Plaintiff "can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-102, 2 L.Ed.2d 80 (1957). Both parties have also filed numerous motions for summary judgment. Summary judgment is proper when the pleadings and evidence on file show that no genuine issue exists as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56.

FACTS

A. Background Facts.

On July 25, 1985, Plaintiff, his wife, and three minor children began a permanent change of station (PCS) move from Fort Devens, Massachusetts to AAFES Headquarters in Dallas, Texas. Amended Complaint, ¶ 11. Documents submitted by Plaintiff to AAFES reflect that he and his family commenced travel on August 7, 1985, arriving in Dallas on August 22, 1985, after making several authorized intermediate stops. Administrative Record ("Ad. Rec.") Vol. XIV, Tab 5. Under AAFES regulations, Plaintiff's family was authorized a subsistence allowance for lodging, food, and laundry expenses on the PCS move for the period they were occupying temporary quarters. Id. at Tabs 3 and 4. The temporary allowance was terminated on November 12, 1985, the date Plaintiff had his household goods delivered to his permanent quarters. Ad.Rec. Vol. XV, Tab 18 at 3-4.

On August 27, 1985, Plaintiff brought a draft subsistence voucher to Ms. Mulder, an accounting clerk in AAFES Comptroller Division. Ad.Rec. Vol. I at 38-42, 60, 61. Ms. Mulder told Plaintiff to attach all lodging and dry-cleaning receipts when he submitted the finalized voucher. She also advised Plaintiff to save his meal receipts since they could be requested. Id. at 40. Plaintiff informed Ms. Mulder that he had not saved his meal receipts because no one told him to do so. Id. at 41-42.

The next day, Plaintiff returned and submitted his initial subsistence voucher covering the period from July 25, 1985 to August 27, 1985 (Ad.Rec. Vol. XIV, Tab 5). Ad. Rec. Vol. I at 60. Sometime after September 17, 1985, Plaintiff submitted a second voucher (Ad.Rec. Vol. XIV, Tab 6). Ad. Rec. Vol. I at 43-44. Ms. Mulder examined the two vouchers and, based on her experience, believed that the amounts claimed for meals were excessive. Id. at 43-44, 67, 71, 76. She consulted with her supervisor, Mr. Petrou, received approval to request meal receipts from Plaintiff, and sent Plaintiff a written request for meal receipts to support his claims (Ad.Rec. Vol. XIV, Tab 23). Ad.Rec. Vol. I at 61-62; Vol. IV at 791.

At a later date, Plaintiff brought a memo (Ad.Rec. Vol. XIV, Tab 24) and copies of some meal receipts (Ad.Rec. Vol. XIV, Tabs 17 and 18) to Mr. Petrou. Ad.Rec. Vol. IV at 791-95. Because the handwriting on the receipts appeared to be similar to that on Plaintiff's voucher, Mr. Petrou asked Plaintiff if he had written the receipts. Ad.Rec. Vol. IV at 799. Plaintiff acknowledged that he had written in the amounts on some of the receipts. Id. Mr. Petrou indicated to Plaintiff that this was permissible as long as the amount filled in was the amount Plaintiff actually spent. Id. Plaintiff stated that he filled in the amounts to the best of his recollection. Id. at 803. Mr. Petrou then had Ms. Mulder compare the receipts submitted to the subsistence vouchers. Id. at 794-95. See also Ad.Rec. Vol. XIV, Tabs 29 and 30.

Subsequently, Mr. Petrou took the vouchers and receipts to his supervisor, Mr. Schulz, the Chief of the General Accounting Division. Ad.Rec. Vol. III at 408, 441. Mr. Petrou did not mention that the receipts were filled in to the best of Plaintiff's recollection. Id. at 441. After he reviewed the receipts and vouchers, Mr. Schulz concluded, based on his twenty years of experience as an auditor, that Plaintiff had submitted false vouchers, claiming money he had not spent. Id. at 420-21. He referred the matter to AAFES Safety and Security Division, who then referred the case to the Air Force Office of Special Investigation ("AFOSI"). Id. at 510, 553-54. AFOSI conducted an investigation and submitted a final report. Ad. Rec. Vol. XIII, Tab 13. AAFES Safety and Security later prepared a supplemental report. Ad.Rec. Vol. XV, Tab 9.

On October 22, 1985, prior to the initiation of the AFOSI investigation, Plaintiff submitted a third subsistence voucher. Ad.Rec. Vol. XIV, Tab 7. Because this voucher covered a period of time when Plaintiff was staying first at a hotel and then at an apartment, Mr. Schulz asked Plaintiff on November 7, 1985 to put his apartment expenses on a separate voucher. Ad.Rec. Vol. III at 416-17; Vol. IX at 1600; Vol. XV, Tab 19. Plaintiff complied and on December 16, 1985, he prepared and submitted a fourth voucher. Ad.Rec. Vol. XIV, Tab 8. On December 17, 1985, Plaintiff prepared and subsequently submitted a fifth and final voucher. Id., Tab 9.

B. Administrative Proceedings.

The statutory procedures generally applicable to federal employees subjected to separation for cause (see 5 U.S.C. §§ 7513, 7701, 7703) are inapplicable to AAFES employees. See 5 U.S.C. § 2105(c). Instead, the applicable rights and procedures are provided by regulation. See Army Regulation (AR) 60-21/Air Force Regulation (AFR) 147-15 (reproduced in pertinent part at Ad.Rec. Vol. XIV, Tab 1).

Following his review of the investigative reports, defendant Colonel Lynch caused an Advance Notice of Separation for Cause to be prepared and issued to Plaintiff on February 24, 1986. Ad.Rec. Vol. XIII, Tab 1. The Advance Notice specified the basis for the proposed action and advised Plaintiff of his right to reply. Id. On March 3, 1986, Plaintiff submitted a written response to the Advance Notice through his attorney. Id. at Tab 4. Following considerable deliberation and consideration of Plaintiff's reply (Ad.Rec. Vol. VII at 1245-46), Colonel Lynch issued a Final Notice of Separation for Cause, which was delivered to Plaintiff on March 12, 1986. Ad.Rec. Vol. XIII, Tab 6. Although some of the specific allegations of misconduct were resolved in Plaintiff's favor by Colonel Lynch, the Final Notice stated essentially the same basis for the action as appeared in the Advance Notice. Id. Plaintiff was separated on June 3, 1986. Amended Complaint, ¶ 2.

Plaintiff appealed Colonel Lynch's decision. Ad.Rec. Vol. XIII, Tab 8. An evidentiary hearing before Mr. Compton, an AAFES Hearing Examiner, began on April 28, 1986, and continued on April 29, 30, May 2, 5, 7, 9, 12, 13, and 14, and concluded on May 16, 1986. Ad.Rec. Vol. XVI, Tab D at 1. Following submission of post-hearing briefs by both counsel (Ad.Rec. Vol. XVI, Tabs E and F), Mr. Compton rendered a report including proposed findings and a recommendation that the separation for cause be confirmed. Id. at Tab D. Thereafter, following review by AAFES Office of General Counsel (id. at Tab C), General Long reviewed the record, including the transcript, and, on December 1, 1986, adopted the findings and recommendation of the Hearing Examiner. Id. at Tab B. General Long's decision constituted final administrative action. AR 60-21/AFR 147-15, para. 3-39a.

COUNTS ONE, TWO, AND THREE

In Count One of his Amended Complaint, Plaintiff alleges that Colonel Lynch's and AAFES's negligent decision to terminate him resulted in a deprivation of a property interest without due process in violation of the Fifth Amendment....