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Schau v. Board of Education of Peoria Public School District No. 150

United States District Court, Seventh Circuit

December 5, 2013

PAMELA SCHAU, Plaintiff,
v.
THE BOARD OF EDUCATION OF PEORIA PUBLIC SCHOOL DISTRICT NO. 150, Defendant.

OPINION

JAMES E. SHADID, Chief District Judge.

This matter is now before the Court on Defendant, the Board of Education of Peoria Public School District No. 150's (the "Board"), Motion for Reconsideration of the Order denying its prior Motion for Summary Judgment. The Motion is fully briefed. For the reasons set forth below, Defendant's Motion for Reconsideration [22] is DENIED.

BACKGROUND

On July 1, 2009, the Board and Plaintiff, Pamela Schau ("Schau"), entered into an employment agreement titled "The Treasurer/Comptroller Contract" (the "Contract"). Sections 3 (a) and (b) of the Contract provided Schau with the right to "written charges, notice of and a hearing before the Board" in the event that shw was subject to discharge for "good and just cause." Section 3(e) of the Contract allowed either party to terminate the agreement without cause by giving the other party 60 days written notice of such termination and payment in the dollar amount equal to 30% of Schau's base annual salary.

On January 25, 2010, the parties mutually agreed to extend the term of the Contract for an additional year and revise Section 3(e) (hereinafter referred to as the "Amendment"). The Amendment provides:

Paragraph 3.e. is hereby deleted and in its stead the following is added...
If the Board desires to terminate this Contract, without cause, effective prior to the end of the Contract, then the Board shall pay to the Comptroller-Treasurer an amount of liquidated damages, which shall be equal to ten (10%) percent of the Comptroller-Treasurer's unpaid salary computed from the effective date of the notice of termination to June 30 of that Contract year, but in no event less than $5, 000.00

At the July 1, 2010, meeting of the Board, Schau was reappointed to the Office of the Treasurer of the District. In August 2010, the Board terminated Schau's employment, effective August 9, 2010. The Board stated that it was relying on the termination without cause provisions of the Amendment and tendered her a check for any accrued vacation pay and a sum of money equal to the liquidated damages contemplated under Section 3(e) of the Amendment to the Contract. Schau never deposited the check, despite the fact that it indicated that it would expire if not tendered for payment within 90 days.

Following her termination, Schau applied for unemployment compensation benefits. She was advised that the Board objected to her application because she was discharged from her employment with the District for cause. The Board has since conceded that at the time of Schau's termination, it believed that she had engaged in conduct warranting her discharge.

Schau brought this suit, alleging that she was denied due process in her termination and that the Board breached the terms of the Contract and Amendment. The Board moved for summary judgment, alleging that Schau somehow conceded that she was terminated without cause. The Motion was denied, and the Board now seeks reconsideration of that ruling. This Order follows.

Legal Standard

"Motions for reconsideration serve a limited function: to correct manifest errors of law or fact or to present newly discovered evidence." Caisse Nationale de Credit v. CBI Industries , 90 F.3d 1264, 1269 (7th Cir. 1996). Furthermore, it is not appropriate to argue matters that could have been raised in prior motions or rehash previously rejected arguments in a motion to reconsider. Id. at 1270.

The Board's Motion for Summary Judgment largely rested on the suggestion that Schau had conceded that she was terminated without cause based on an admission that "At the time of the termination, the District tendered to her a sum of money equal to the liquidated damages which it was required to pay her for a termination without cause under provisions of Section 3(e) of the amended employment agreement" and that the Board "terminated Schau relying upon the termination without cause provisions of the employment agreement and paid her the severance pay as contemplated under Section 3.e. of the agreement." However, the Court found that her admission that the Board cited the termination without cause provision or tendered the amount of damages that would have been due under that provision was simply not equivalent to an admission that she was actually terminated for reasons other than cause.

The Court further noted that although the Board indicated that it was terminating her employment without cause, they opposed her application for unemployment benefits by suggesting that she had been terminated for cause, and that even in the pleadings in this case, the Board has referenced unspecified misconduct warranting Schau's discharge. The Court found that in taking these inconsistent positions, the Board appeared to be trying to have its cake and eat it, too. If Schau could prove that she was actually terminated for misconduct constituting cause, then she was deprived of her contractual right to written charges, notice, and a hearing prior to her discharge. The Court therefore found a genuine issue of material fact as to whether Schau's termination was ...


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