IN THE CASE OF:  

		BOARD DATE:  16 September 2020

		DOCKET NUMBER:  AR20190003657


APPLICANT REQUESTS: Through counsel, correction of his record to show:

*	he was relieved of all financial liability stemming from a Financial Liability 
	Investigation of Property Loss (FLIPL)
*	reimbursement of all monies paid totaling $12,474.00
*	in the alternative assessment of one month's base pay for the FLIPL and 
	reimbursement of $8,331.00
*	a personal hearing before the Board

APPLICANT'S SUPPORTING DOCUMENTS CONSIDERED BY THE BOARD:

*	DD Form 149 (Application for Correction of Military Record)
*	Enclosure 2; DD Form 200 (FLIPL) and allied documents
*	Enclosure 3; Memorandum, Subject: Appeal of Assessment of Financial Liability, 
	FLIPL number 11-21, dated 13 January 2019
*	Enclosure 4; Attorney affidavit
*	Enclosure 5; Master Military Pay Summary
*	Enclosure 6; Leave and Earnings Statement (LES)
*	Enclosure 7; excerpt Army Regulation (AR) 735-5 (Policies and Procedures for 
	Property Accountability)

FACTS:

1.  The applicant states through counsel in part:

	a.  The appeal regards the assessment of $12,474.00 in financial liability in 2011 by
Headquarters and Headquarters Company ("HHC"), 3rd U.S. Infantry Regiment, Fort 
Myer, Virginia pursuant to FLIPL number 11-21.  Although more than three years have 
passed since the initial assessment of financial liability, the error was not discovered 
until counsel first met the applicant during a legal assistance appointment at Fort 
Stewart, GA in 2015 and reviewed FLIPL number 11-21 documents then made 
available to him.

	b.  On or around September 2015, counsel filed a petition to the Board on behalf of 
the applicant and enclosed all of the available documents (Docket Number: 
AR20150016188).  On or around October 2016, that petition was returned because 
certain documents were allegedly missing from FLIPL number 11-21 and the Board 
lacks the ability to gather, subpoena, or procure documents on its own.  The alleged 
missing documents were identified by Headquarters, Department of the Army, G-4 
(HQDA G-4) after the Board requested an advisory opinion from HQDA G-4 regarding 
FLIPL number 11-21.

	c.  The applicant was assigned to the 3rd U.S. Infantry Regiment at Fort Myer as a 
platoon sergeant and public affairs broadcast noncommissioned officer-in charge from 
January 2010 until May 2011 and was the platoon's hand receipt holder.  On 3-5 May 
2011, he and his replacement, Staff Sergeant (SSG) A- G-, conducted a joint inventory 
of the platoon's hand receipt and three items remained missing after searching the unit: 
(1) a video camera, (2) a camera lens, and (3) a microphone.

	d.  On 12 May 2011, the applicant informed SSG G- that he was unable to find the 
items and the "only thing he can think of is that someone came in while the door was 
open and grabbed the bag that [the items] were in."  He later filed a police report to 
document the items were likely stolen from the public affairs office.

	e.  On 22 June 2011, First Lieutenant (1LT) D- was appointed to investigate the lost 
items as the FLIPL number 11-21 Investigating Officer (IO).  On 14 July 2011, the IO 
concluded "the articles [of property lost, with a] total cost of $13,860.04, were lost 
through gross negligence of the applicant.  The evidence does not deviate from the 
personal, direct, and supervisory responsibility and accountability that the applicant was 
entrusted to by the U.S. Army in maintaining 100 percent accountability of all property to 
which he signed for and sub-hand receipted down through his leadership.  The 
applicant committed gross negligence in the loss of the equipment."  The IO found him 
at fault for failing to sub-hand receipt the lost items to the lowest level user and failing to 
lock all doors and store the items in the correct storage area.  In addition, the IO also 
found a "failure in command responsibility as the physical standards were not met 
because of a lack of command responsibility on physical security in the [public affairs 
office] areas" and a failure by the command to conduct required security inspections. 
Finally, when initiating the investigation, the HHC Commander acknowledged that 
although his "command guidance for hand receipt holders had been to sign property 
down to the lowest level [t]hroughout Fiscal Year 2010, with hand receipt holders 
changing positions this guidance had been overlooked."  Ultimately, the IO 
recommended only the applicant be held financially liable for the full value of the items 
minus depreciation: $12,474.00.

	f.  After receiving FLIPL number 11-21, the applicant immediately sought legal 
assistance at Fort Myer, but there were no available appointments within the allotted 
response time and the legal assistance office did not seek an extension of time to 
respond nor inform him of his right to seek such an extension.  Instead, he briefly 
consulted with a paralegal/clerk in the office who informed him that a rebuttal would not 
likely succeed since he was the signed hand-receipt holder and the property was lost. 
Regrettably, the paralegal/clerk did not review the available FLIPL number 11-21 
documents before advising the applicant, and he relied on this flawed advice when he 
declined to submit a rebuttal.

	g.  On 18 July 2011, the approving authority, approved financial liability in the 
amount of $12,474.00 without making any comments or any changes to FLIPL number 
11-21.  There is no evidence in the documents originally made available to the applicant 
nor in the entire FLIPL number 11-21 file finally provided by the unit that a military or 
civilian attorney ever conducted a legal review to determine whether the investigation 
was factually and legally sufficient before assessing financial liability.  While there is no 
legal review, FLIPL number 11-21 includes a review and recommendation by the 
regimental S-4 section.  By November 2011, the applicant paid the entire assessed 
amount, $12,474.00.

	h.  Under Army Regulation (AR) 735-5 (Policies and Procedures for Property 
Accountability) (28 February 2005), paragraph 13-29, no person may be held financially 
liable unless: (1) property was lost; (2) the person was responsible for the lost property; 
(3) the person was negligent or committed willful misconduct regarding the care and 
safeguarding of the property; and (4) the person's negligence or willful misconduct was 
the proximate cause of the loss.  Each of these four requirements must be satisfied by 
specific findings, which are "supported by evidence" and may not include "personal 
speculation, suspicion, or opinion not supported by evidence."  AR 735-5, paragraph. 
13-32.  The applicant concedes the property was lost and he was responsible for the 
lost property as the hand-receipt holder.

	i.  Negligence.  Even as the hand-receipt holder for lost property, however, the 
applicant may not be held financially liable unless he was negligent or committed willful 
misconduct.  The IO found his actions constituted "gross negligence."  Gross 
negligence is an "extreme departure from due care resulting from an act or omission of 
a person ... which falls far short of that degree of care for the property that a reasonably 
prudent person would have taken under similar circumstances.  It is accompanied by a 
reckless, deliberate, or wanton disregard for the foreseeable loss or damage to the 
property."  AR 735-5, paragraph 13-29b(3).  The IO failed to explain how the applicant's 
actions or omissions satisfied this high standard.  The failure to sub-hand receipt items 
is not only something which occurs with relative frequency in the Army, but the IO also 
found that the applicant himself used and worked with the items that were lost, which 
makes his decision not to sub-hand receipt the items reasonable and prudent.  In 
addition, it is not reasonably foreseeable that a failure to sub-hand receipt items would 
have necessarily led to the items being lost.  Finally, the IO's finding that the applicant's 
failure to always lock the door or store the items in the proper storage area constituted 
"gross negligence" is incongruent considering the IO failed to also find the chain of 
command grossly negligent and financially liable despite: repeated failures to meet 
"physical security standards ... because of a lack of command emphasis on physical 
security" and conduct required security inspections, not to mention that the HHC 
Commander himself acknowledged his command guidance to sub-hand receipt items 
"ha[d] been overlooked."

	j.  Even if the applicant's actions or omissions constituted negligence, financial
liability may still not be assessed unless this negligence was the "proximate cause" for 
the loss.  "Proximate cause" is the "cause, which in a natural and continuous sequence 
of events unbroken by a new cause produced the loss and without this cause, the loss 
or damage would not have occurred."  AR 735-5, section 2, Terms.  In FLIPL number 
11-21, neither the IO nor the approving authority ever even used the term ''proximate 
cause," let alone established facts to demonstrate that anything the applicant allegedly 
did or did not do was the proximate cause for the loss.  This despite specific instructions 
from the appointing authority to make a finding of proximate cause, and the clear 
mandate of AR 735-5, paragraph 13-29 requiring it.

	k.  The IO's failure to make any finding regarding "proximate cause" is fatal to FLIPL
number 11-21 for two reasons.  First and most importantly, without a finding of 
"proximate cause," financial liability is per se factually and legally insufficient under AR 
735-5 and the assessment of $12,474.00 must be reversed.  Second, the IO's failure to 
analyze and settle the issue of "proximate cause" is particularly significant in this case 
because there were at least two other plausible proximate causes for the property loss 
that escaped scrutiny: (1) the lost property may have been stolen, and (2) the IO found 
the chain of command repeatedly failed to secure the building and conduct required 
security inspections, which greatly increased the chances of theft.  Each of these 
independent acts could reasonably sever the causal chain of responsibility and
relieve the applicant of financial liability---even if he was negligent.  As a result, without 
the IO or approval authority specifically finding the applicant was in fact the proximate 
cause of the loss in FLIPL number 11-21, there is no legal determination that it would be 
appropriate to hold him (and not another person) financially liable for the loss.  And for 
this reason, financial liability is factually and legally insufficient.  AR 735-5 requires a 
finding of proximate cause specifically for this type of case: to ensure financial liability is 
accurately and fairly assessed only against a legally determined responsible person.

	l.  Conclusion.  Although the applicant was the hand receipt holder for the three lost 
items, this alone is not enough to satisfy AR 735-5 and hold him financially liable.  The 
IO's finding that he met the high standard of "gross negligence" is highly suspect based 
on the facts discovered in the investigation.  Even worse, neither the IO nor the 
approval authority made a specific finding that anything he allegedly did or did not do 
was the proximate cause for the loss.  For these reasons, FLIPL number 11-21 is 
factually and legally insufficient, financial liability may not be lawfully assessed under 
AR 735-5, and he should be reimbursed for all of the $12,474.00.

	m.  After receiving a financial investigation of property loss, the approval authority 
must "obtain a legal opinion as to its legal sufficiency prior to determining whether to 
assess financial liability.  A legal advisor will provide a written opinion as to the legal 
sufficiency of the FLIPL [that] will be attached to the FLIPL prior to the approving 
authority's review and decision."  AR 735-5, paragraph 13-38a, b; see also DD Form 
200, section H.  If the legal advisor determines the investigation is legally insufficient, 
the advisor will provide corrective actions that must be implemented before taking final 
action to assess financial liability.

	n.  There is no evidence in the original documents made available to the applicant 
nor the entire file provided by the 3rd U.S. Infantry Regiment S-4 section that an 
independent legal review of FLIPL number 11-21 was ever conducted---either before or 
after the approving authority approved the investigation.  This conclusion is further 
supported by the FLIPL number 11-21 DD Form 200 checklist, which does not indicate 
that the approval authority sought or received such a legal opinion.  Notably, although 
there is no legal review, FLIPL number 11-21 includes a review and recommendation by 
the regimental S-4 section, which is not required.  This demonstrates that the IO and 
approval authority knowingly took the opportunity to seek a written opinion of the 
investigation by the S-4 section and were aware that such an opinion could be included 
with the investigation.  It also strongly suggests the IO and approval authority declined 
to seek a similar written opinion by the legal office---or it would have been included in 
the file.

	o.  While the failure to seek an independent legal review is a per se violation of AR 
735-5, this case exhibits precisely why a legal opinion is required under AR 735-5 the 
opinion would have timely identified the factual and legal insufficiencies and excessive 
assessment of financial liability, which could have been corrected and addressed at the 
time.  An independent legal opinion serves not only the interest of the person being held 
financially liable, but also the command and the Army to ensure financial liability is fairly 
and accurately assessed only against a legally determined responsible person in 
compliance with Army regulations-and such a legal review may never be ignored or 
overlooked.

	p.  Conclusion.  As there is no evidence that an independent legal review of FLIPL 
number 11-21 was ever conducted, financial liability may not be lawfully assessed 
pursuant to AR 735-5, paragraph 13-38 and the applicant should be reimbursed for all 
of the $12,474.00.

	q.  Under AR 735-5, paragraph 13-41, "a. When negligence or willful misconduct are 
shown to be the proximate cause for a loss, the following individuals/entities should be 
assessed the full amount of the Government's loss, minus amounts charged to others. 
(1) Accountable officers. (2) States and Territories of the United States. (3) Contractors 
and contractor employees. (4) Non-appropriated fund activities. (5) Persons losing 
public funds. (6) Soldiers losing personal arms or equipment. (7) Persons, who lose, 
damage or destroy Government quarters, and/or furnishings and equipment provided by 
the Government for use in quarters, through gross negligence or willful misconduct. (8) 
Individuals or entities not federally employed, b. In all other cases, the amount equal to 
one month 's basic pay at the time of the loss, or the actual amount of the loss to the 
Government, whichever is less, may be assessed." (emphasis added).

	r.  The applicant is not within the eight categories of persons or entities that may be
assessed the full amount of lost property identified in AR 735-5, paragraph 13-41a.  He 
was not serving as an "accountable officer."  He was an active duty Soldier.  He did not 
lose public funds or his personal arms or equipment.  The lost property was not 
"Government quarters" nor was it provided for "use in quarters."  Accordingly, any 
assessment of financial liability against him is strictly limited to a maximum of one-
month's base pay pursuant to AR 735-5, paragraph 13-41b.  As of July 2011, the 
applicant's monthly base pay at time of loss was $4,143.00.  The assessment of 
$12,474.00 is extraordinarily excessive (more than three times the monthly base pay) 
and clearly prohibited.

	s.  Conclusion.  Even assuming FLIPL number 11-21 is factually and legally 
sufficient, the applicant's financial liability may not exceed a maximum of one-month's 
base pay, or $4,143.00, pursuant to AR 735-5, paragraph 13-41.  If the Board 
determines that financial liability against him was appropriate, the amount of this liability 
must be reduced to $4,143.00 and he should be reimbursed for all of $8,331.00 
overpaid.

2.  A review of the applicant's official records shows the following:

	a.  On 6 July 1999, the applicant enlisted in the Regular Army and served 
continuously until his disability retirement.

	b.  On 18 September 2016, the applicant was honorably retired from active duty in 
the rank/grade of sergeant first class (SFC)/E-7.  

3.  The applicant provides through counsel:

	a.  DD Form 200 providing the supporting documentation and results of the FLIPL.  
The results and recommendations summarized by counsel in his opening statement.

	b.  Memorandum, Subject: Appeal of Assessment of Financial Liability, FLIPL 
number 11-21, wherein counsel states the five alleged missing documents needed to 
adjudicate the applicant's case were located by HQDA, G-4 and the unit, and the 
documents available to the Board were more than sufficient to adjudicate the case.

	c.  Attorney affidavit wherein counsel states he and the applicant had made 
extensive efforts to discover any and all documents related to FLIPL number 11-21 
because the Board returned the applicant's case for missing certain documents.  He has 
provided an accurate and complete copy of every FLIPL number 11-21 document he 
has received from the applicant.

	d.  Master military pay summary showing the applicant at the time was indebted for 
$12,474.00 with a final balance of $0.00.

	e.  LES showing at the time the applicant no longer had a debt.

	f.  Excerpt from AR 735-5 providing the procedures for conducting an investigation in 
the loss of U.S. property.  

4.  On 27 July 2020, the Office of the Deputy Chief of Staff, G-4 reviewed the applicant's 
records and rendered an advisory opinion in his case.  After a thorough review, the 
Director of Supply Policy opined that:

	a.  After a thorough review, the Office of the Deputy Chief of Staff, G-4 concluded 
that the FLIPL was not conducted in accordance with (IAW) AR 735-5 and the 
recommendation to hold the applicant liable is not legally sufficient nor administratively 
sound.  Their recommendation is based on the following:

		(1)  The applicant's base pay at the time of loss was $4,143.70 but $12,474.00 
was collected from him.  IAW AR 735-5, chapter 13-41b, when determining
the amount to charge, the IO can only recommend to charge the amount equal to one 
month’s basic pay at the time of the loss, or the actual amount of the loss to the 
Government, whichever is less.  The set of circumstances involving the applicant does 
not meet the requirement to be able to charge him more than one month’s base pay.

		(2)  According to the IO, the unit did not conduct security inspections of buildings
nightly, or follow security protocol.  On numerous occasions the building was found to
be unsecure.  The commands failure to secure the building calls into question the
proximate cause of the loss of this equipment.

		(3)  The applicant was not allotted the time to obtain a legal review of the IO’s 
findings once he was notified of the recommendations.  When he received notification 
that he was being recommended for financial liability, he tried to obtain a legal review 
but there were no available appointments during the allotted time he had to review the 
findings.  A paralegal clerk in the legal office told him that since he was the hand receipt 
holder he would be found liable, so challenging the IO’s findings would be futile.  IAW 
AR 735-5, chapter 13-35, individuals against whom a charge of financial liability is 
recommended may obtain legal advice from the servicing legal office, (Office of The 
Staff Judge Advocate, Post Judge Advocate, Command Counsel, or Legal Counsel).

		(4)  The approving authority failed to ensure that a legal review was conducted 
for this FLIPL.  IAW AR 735-5, chapter 13-39, the approving authority will obtain a legal 
opinion, if not already obtained by the appointing authority, as to determining its legal 
sufficiency prior to establishing whether to assess financial liability.  This did not 
happen.  A legal advisor will provide a written opinion as to the legal sufficiency of the 
financial liability investigation of property loss.  A legal opinion would have identified the 
factual and legal insufficiencies and excessive assessment of financial liability, which 
could have been corrected and addressed in a timely manner.

5.  On 7 August 2020, through counsel, the applicant responded to the advisory opinion 
essentially concurring with the recommendation of the advisory opinion.

6.  See applicable references below.

BOARD DISCUSSION:

After review of the application and all evidence, the Board determined there is sufficient 
evidence to grant partial relief.

1.  The Board agreed with the G-4 Advisory Opinion that the applicant should be 
relieved of liability and be reimbursed for $12,474.00 that he was charged in connection 
with a legally insufficient and administratively incorrect FLIPL.  The amount charged 
was more than allowed by regulation and based on faulty security procedures, it is 
unclear that the applicant’s actions or omissions were the proximate cause of the loss.  
Furthermore, it appears that the applicant’s regulatory right to obtain legal advice was 
impeded.

2.  The applicant's request for a personal appearance hearing was carefully considered.  
In this case, the evidence of record was sufficient to render a fair and equitable 
decision.  As a result, a personal appearance hearing is not necessary to serve the 
interest of equity and justice in this case.
?
BOARD VOTE:

Mbr 1	Mbr 2	Mbr 3

:	:	:	GRANT FULL RELIEF

: XX	:XX	:XX	GRANT PARTIAL RELIEF

:	:	:	GRANT FORMAL HEARING

:	:	:	DENY APPLICATION


BOARD DETERMINATION/RECOMMENDATION:

1.  The Board determined the evidence presented is sufficient to warrant a 
recommendation for partial relief.  As a result, the Board recommends that all 
Department of the Army records of the individual concerned be corrected by 

*	relieving him of all financial liability stemming from a FLIPL #11 -21, dated 19 
May 2011, and
*	reimbursement of all monies paid totaling $12,474.00

2.  The Board recommends no personal appearance.


		  
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.


REFERENCES:

1.  AR 735-5 (Policies and Procedures for Property Accountability) provides
basic policies and procedures for accounting for U.S. Army property and accounting
for lost, damaged, or destroyed U.S. Army property.

	a.  Paragraph 13-29 states a financial liability officer's responsibility is to determine 
the cause and value of the loss, damage or destruction of Government property listed 
on the FLIPL, and to determine if assessment of financial liability is warranted.  That 
determination must be determined from the facts developed during a thorough and 
impartial investigation.  However, before beginning the investigation the financial liability 
officer must have an understanding of the terms "responsibility, culpability, proximate 
cause, and loss."

	b.  Paragraph 13-34 states the financial liability officer will give any individual, 
against whom he or she makes a recommendation to assess financial liability, a chance 
to examine the FLIPL after the findings and recommendations have been recorded on 
the DD Form 200, and the opportunity to make a rebuttal statement in his or her behalf.

	c.  Paragraph 13-35 states Individuals have the right to submit a rebuttal statement, 
or other added evidence, and to have that statement or evidence considered and 
attached to the FLIPL for consideration by higher authority.  Individuals against whom a 
charge of financial liability is recommended may obtain legal advice from the servicing 
legal office, (Office of the Staff Judge Advocate, Post Judge Advocate, Command 
Counsel or Legal Counsel).  

	d.  Paragraph 13-38 states upon receiving a FLIPL on which the approving authority 
believes financial liability is appropriate, the approving authority will obtain a legal 
opinion as to its legal sufficiency prior to determining whether to assess financial 
liability.  A legal advisor will provide a written opinion as to the legal sufficiency of the 
FLIPL.  If, in the legal advisor’s opinion, the FLIPL is not legally sufficient, the opinion 
will state the reasons why and make appropriate recommendations.  The opinion will be 
attached to the FLIPL prior to the approving authority’s review and decision.  The 
approving authority should ensure corrective actions are taken before taking final action 
to assess financial liability.

	e.  Paragraph 13-41b states liability limits in all other cases, will not exceed the 
amount equal to one month’s basic pay at the time of the loss, or the actual amount of 
the loss to the Government, whichever is less, may be assessed.

2.  Title 10, United States Code, section 1552 states the Secretary of a military 
department may correct any military record of the Secretary’s department when the 
Secretary considers it necessary to correct an error or remove an injustice.
3.  AR 15-185 (Army Board for Correction of Military Records (ABCMR)) prescribes the 
policies and procedures for correction of military records by the Secretary of the Army, 
acting through the ABCMR.  The ABCMR may, in its discretion, hold a hearing or 
request additional evidence or opinions.  Additionally, it states in paragraph 2-11 that 
applicants do not have a right to a hearing before the ABCMR.  The Director or the 
ABCMR may grant a formal hearing whenever justice requires.

//NOTHING FOLLOWS//
ABCMR Record of Proceedings (cont)	 AR20190003657


9

ARMY BOARD FOR CORRECTION OF MILITARY RECORDS

RECORD OF PROCEEDINGS


1