UPS changed the address on my pkg and delivered it into the wrong hands.Pkg worth over $3000.Who's at fault?

Over 2 months ago my son was deployed and he tried to send my sons and I some gifts but as soon as the package made it to Shreveport, Louisiana a clerk at UPS changed the address and didn't follow up on it so my package was delivered to the wrong address but the driver tried to go back and retrieve the package but the lady gave him the run around and now UPS wants to send us a check for 250 dollars when the package was worth over 3000 dollars.This is not right.My son wanted to surprise his 14 year old brother with a Xbox 360 elite for his birthday which was on August 23 which is is 2 months late.Am I suppose to investigate this matter or UPS?