61 Agric. Dec. 164 Administrative Record contains no explanation for the dramatic drop in value. Tabs 2, 12. To the resale $74,820.00 stumpage value, the "overbid" of $16,336.40 was added, for a total of $91,156.40. This is the credit that Advantage Timber was given for the 254G Contract timber, all of which was still standing. Advantage Timber was also given credit for the money it paid on the contract, a total of $33,500.00, consisting of the performance guarantee of $14,000.00 and the downpayment of $19,500.00. Thus, Advantage Timber received credit for $124,656.40. Tabs 2, 12. When Advantage Timber's $124,656.40 credit was applied to what the U. S. Forest Service expected under the 254G Contract, Advantage Timber still fell short. The U. S. Forest Service calculated it had the right to collect (1) the contract stumpage value; (2) plus interest; (3) plus the costs of resale. Those three components were calculated as follows. The U. S. Forest Service multiplied the 2,303 CCF contract stumpage by the $57.88 per CCF contract price, for a contract stumpage value of $133,297.64, owed by Advantage Timber. That figure was then multipled by 7.25% to arrive at "interest on the uncollected stumpage value" in the amount of $9,664.08. [Advantage Timber was charged interest on even the $33,500.00 it had paid.] Re-[]sale costs of $771.00 were then added, $574.00 for "Dawson," and $197.00 for "Wagner." The total, calculated by adding together $133,297.64 contract stumpage value, plus $9,664.08 interest, plus $771.00 costs, is $143,732.72. The $143,732.72 total that the U. S. Forest Service calculated it had the right to collect, was $19,076.32 more than Advantage Timber's $124,656.40 credit. Thus, the U. S. Forest Service demanded that Advantage Timber pay $19,076.32 damages. Tabs 2, 6, 12. On May 9, 2001, the U. S. Forest Service began charging Advantage Timber 6% per year interest on the $19,076.32. The U. S. Forest Service indicated that it would also add 6% per year penalty charge to the interest charge, plus administrative costs to cover processing and handling of the claim. Tab 2. As of June 5, 2001, the last calculation in the Administrative Record, Advantage Timber's unpaid obligation totaled $19,196.70. Tab 1. Advantage Timber failed to pay the $19,196.70. Whether, under these circumstances, Advantage Timber and Ricky Johnson proved themselves to be unreliable and not presently responsible to do business with the Federal Government is a matter upon which reasonable minds can differ. Likewise, whether, in the interest of protecting the Federal Government's and the public's interest, suspension and debarment needed to be imposed, is also a matter upon which reasonable minds can differ. Based on Advantage Timber's breach of contract and its failure to pay the damages for breach ($19,196.70 as of June 5, 2001), the U. S. Forest Service decided that Advantage Timber was not presently responsible to do business with the Federal Government and suspended Advantage Timber effective June 26, 2001, and then debarred Advantage Timber for three years, until June 26, 2004. Further, the U. S. Forest Service applied the same sanction to three individuals that it found to be affiliated with Advantage Timber: Ricky Johnson, Yolanda Johnson, and James C. Johnson. Findings of Fact 1. Advantage Timber failed to pay to the U. S. Forest Service the balance of damages for breach of the 254G Contract, which, as of June 5, 2001, amounted to $19,196.70, with interest, penalties, and costs continuing to accrue. 2. The Administrative Record does not establish by a preponderance of the evidence that the integrity of the U. S. Forest Service's timber sale program was threatened by the actions of Advantage Timber and Ricky Johnson. 3. Thus, the Administrative Record does not establish by a preponderance of the evidence that Advantage Timber's breach of the 254G Contract constitutes a "(v)iolation of the terms of a public agreement or transaction so serious as to affect the integrity of an agency program, such as: .. (2) A history of failure to perform or of unsatisfactory performance of one or more public agreements or transactions" as would be required under 7 C.F.R. § 3017.305(b)(2). .... 4. Ricky Johnson, President of Advantage Timber, made the 254G Contract decisions for Advantage Timber and controlled Advantage Timber's actions with respect to the 254G Contract. 5. The seriousness of Advantage Timber's and Ricky Johnson's failure to pay is lessened and is mitigated by several circumstances concerning the 254G Contract, including: (a) their having been unaware when they entered into the 254G contract that "excessive amounts of bullets" would be found embedded in the timber from that area; (b) their having taken nothing under the 254G Contract and nothing tangible from the U. S. Forest Service, because they cut no timber, removed no timber, and did not impact the physical environment; (c) their safety issues, including their need to avoid exposing their customers' equipment and personnel to the potential dangers of bullets embedded within the timber; (d) their having no customers who would accept the 254G timber; 61 Agric. Dec. 164 (e) their inability to cancel the contract, due to the U. S. Forest Service's position that "cancellation by agreement may be permitted only in those instances where it's in the best interest of the government;" (f) the damages calculation triggered by the dramatic drop in appraised value from the price they were required to pay, $57.88 per CCF, to the reappraised or resale price of only $29.00 per CCF, roughly half the price; and (g) their $33,500.00 payment to the U. S. Forest Service [the performance guarantee of $14,000.00 plus the downpayment of $19,500.00], for which they derived no benefit. 6. Yolanda Johnson merely certified, as Secretary of Advantage Timber, that Ricky Johnson was President of Advantage Timber and that the corporation's entering into the 254G Contract was authorized. [She was not initially regarded by the U. S. Forest Service as an "affiliate," as only Ricky Johnson was deemed responsible by the officials closest to the contracting. Tabs 4, 6.] Neither her having made a certification, nor her position as an initial director and officer [Secretary-Treasurer] in 1997, nor any other evidence, established that she controlled Advantage Timber's or Ricky Johnson's actions with respect to the 254G Contract. 7. James C. Johnson was an initial director and officer [Vice President] in 1997. [He was not initially regarded by the U. S. Forest Service as an "affiliate," as only Ricky Johnson was deemed responsible by the officials closest to the contracting. Tabs 4, 6.] Neither his positions within the corporation nor any other evidence, established that he controlled Advantage Timber's or Ricky Johnson's actions with respect to the 254G Contract. Conclusions of Law 1. Suspension and debarment could not be imposed under 7 C.F.R. § 3017.305(b)(2). 2. Suspension and debarment could be imposed under 7 C.F.R. § 3017.305(c)(3), because the Administrative Record does establish by a preponderance of the evidence that Advantage Timber failed to pay to the U. S. Forest Service a single substantial debt, in the amount of $19,196.70. 3. The U. S. Forest Service acted within its discretion to suspend and debar Advantage Timber, under 7 C.F.R. § 3017.305(c)(3). 4. Ricky Johnson was an "affiliate" of Advantage Timber within the meaning of 7 C.F.R. § 3017.105, and debarment may include such an affiliate. 7 C.F.R. § 3017.325(a)(2). 5. The U. S. Forest Service acted within its discretion to suspend and debar Ricky Johnson as an affiliate, under 7 C.F.R. § 3017.325(a)(2). 6. Suspension and debarment for a period no longer than one year is commensurate with the seriousness of Advantage Timber's and Ricky Johnson's failure to pay and adequately protects the Federal Government's interest in conducting business only with responsible persons. 7 C.F.R. §§ 3017.115, 3017.320. 7. Yolanda Johnson could not be suspended or debarred as an affiliate, because the Administrative Record does not establish by a preponderance of the evidence that she controlled Advantage Timber's or Ricky Johnson's actions with respect to the 254G Contract. 7 C.F.R. § 3017.105. 8. James C. Johnson could not be suspended or debarred as an affiliate, because the Administrative Record does not establish by a preponderance of the evidence that he controlled Advantage Timber's or Ricky Johnson's actions with respect to the 254G Contract. 7 C.F.R. § 3017.105. Order 1. The suspension and debarment of Advantage Timber are affirmed, for a period ending no later than June 26, 2002. 2. The suspension and debarment of Ricky Johnson are affirmed, for a period ending no later than June 26, 2002. 3. The suspension and debarment of Yolanda Johnson are hereby vacated. 4. The suspension and debarment of James C. Johnson are hereby vacated. 5. This decision is final and is not appealable within the United States Department of Agriculture. 7 C.F.R. § 3017.515. Copies of this Decision and Order shall be served by the Hearing Clerk upon each of the parties. [This Decision and Order became final March 15, 2002.-Editor] 61 Agric. Dec. 173 HORSE PROTECTION ACT DEPARTMENTAL DECISIONS In re: ROBERT B. McCLOY, JR. HPA Docket No. 99-0020. Decision and Order. Filed March 22, 2002. HPA – Allowing entry – Guarantor – Baird test – Burton test - Lewis test - Crawford test · Credibility determinations - Relevant evidence defined - Self-serving testimony – Affidavit defined – Civil penalty – Disqualification – Sanction policy. The Judicial Officer (JO) affirmed the decision by Administrative Law Judge Dorothea A. Baker (ALJ) concluding that Respondent allowed the entry of a horse in a horse show while the horse was sore in violation of 15 U.S.C. § 1824(2)(D) and assessing Respondent a $2,200 civil penalty. In addition, the JO disqualified Respondent for 1 year from exhibiting, showing, or entering any horse and from managing, judging, or otherwise participating in any horse show, horse exhibition, horse sale, or horse auction. The JO found that Respondent's residence and place of business are in Oklahoma and concluded that, under 15 U.S.C. § 1825(b)(2), (c), Respondent may obtain judicial review in the United States Court of Appeals for the Tenth Circuit and the United States Court of Appeals for the District of Columbia Circuit. Therefore, the JO rejected Respondent's request that the JO apply the tests adopted in Lewis v. Secretary of Agric., 73 F.3d 312 (11th Cir. 1996); Baird v. United States Dep't of Agric., 39 F.3d 131 (6th Cir. 1994); and Burton v. United States Dep't of Agric., 683 F.2d 280 (8th Cir. 1982), to determine whether Respondent violated 15 U.S.C. § 1824(2)(D). The JO rejected Complainant's contention that the ALJ's credibility determinations were error, stating the JO gives great weight to the ALJ's credibility determinations because of her opportunity to see and hear the witnesses testify. The JO also rejected Complainant's contention that the ALJ erred by receiving and finding credible self-serving testimony. The JO stated that neither the Administrative Procedure Act nor the Rules of Practice prohibits the reception of self-serving testimony and self-serving testimony is not as a matter of law unworthy of belief. The JO rejected Complainant's argument that Respondent's Exhibit C was irrelevant stating that it had a tendency to make the existence of a fact of consequence to the determination of the proceeding more likely than it would be without the exhibit. The JO agreed with Complainant's contention that the ALJ erroneously referred to two written statements as "affidavits." The JO stated that one of the statements was clearly not a writing made on oath or affirmation before a person having authority to administer the oath or affirmation. The JO found that the other written statement lacked a notary seal. Therefore, there was not sufficient proof that the person who administered the oath had authority to administer the oath. Colleen A. Carroll, for Complainant. Respondent, Pro se. Initial decision issued by Dorothea A. Baker, Administrative Law Judge. Decision and Order issued by William G. Jenson, Judicial Officer. PROCEDURAL HISTORY |