Ted D. Malone v. Jefferson County Board of Education ( 2021 )

RENDERED: JANUARY 15, 2021; 10:00 A.M.
NOT TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2019-CA-1398-MR
TED D. MALONE APPELLANT
APPEAL FROM JEFFERSON CIRCUIT COURT
v. HONORABLE SUSAN SCHULTZ GIBSON, JUDGE
ACTION NO. 12-CI-002968
JEFFERSON COUNTY
BOARD OF EDUCATION APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE: CALDWELL, MAZE, AND MCNEILL, JUDGES.
MCNEILL, JUDGE: Ted D. Malone (“Malone”) appeals from orders of the
Jefferson Circuit Court granting summary judgment on his claims of breach of
contract, breach of implied covenant of good faith and fair dealing, fraudulent
inducement, tortious interference with a prospective advantage, state wage and
hour law violations, and wrongful discharge, as well as several discovery orders.
Finding no error, we affirm.
Malone was employed by the Jefferson County Board of Education
(“JCBE”) as a special education teacher at Shawnee High School (“Shawnee”)
from 1989 until his resignation on May 1, 2011. His resignation was prompted by
two incidents of alleged misconduct occurring in early 2011.
On January 10, 2011, Shawnee Assistant Principal Don Dillard
(“Dillard”) met with Malone about deficiencies in his students’ alternate portfolios
that are completed and submitted for state assessment. The portfolio entries were
unorganized, some lacked dates, others were not graded, and some students had no
entries whatsoever. Perhaps most concerning, the assessment lacked sufficient
complexity to allow students to demonstrate proficient scores. Dillard instructed
Malone to restart the portfolio process, provided sample portfolios, and set a series
of deadlines and progress checks to ensure the alternate portfolios were timely
completed and reflected the true abilities of the students.
However, when Malone submitted the portfolios for a final in-school
review on March 28, 2011, they exhibited many of the same problems as before.
Malone argued the portfolios were a work in progress and alleged Dillard’s
directive to restart the portfolio process violated state law. On April 15, 2011,
Malone received a five-day suspension for his ongoing disorganization, disregard
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of the testing code, and failure to follow administrative directives regarding the
alternate portfolios.
The second incident occurred on April 11, 2011, four days prior to
Malone’s suspension, when Malone allegedly dispensed the wrong dosage of
medication to a student. Several weeks prior, Malone had received an
“Authorization to Give Prescription Medication” form for the student to begin
receiving 1 mg of Valium on March 23, 2011, in addition to the student’s current
medication, Carbidopa-Levodopa. Additionally, on April 1, Malone received an
email from Anna Maria Mayberry (“Mayberry”), the student’s guardian and a
licensed practical nurse, informing Malone of a doctor’s order increasing the
Valium dosage to 3 mg on beginning April 11, 2011.
However, Malone misread the email as ordering Valium
administration to begin on that date, not merely the increased dosage.
Consequently, Malone did not administer the Valium from March 23, 2011, the
date of the authorization, to April 11, 2011, the date of the incident. It is unknown
why Malone did not dispense the Valium prior to receiving the email.
On the day of the incident, Mayberry was at the school to insert a new
feeding tube and assisted Malone in the process of administering the student’s
medicine. According to Mayberry’s affidavit, Malone handed her what she
believed to be 3 mg of Valium but was in fact three doses of Carbidopa-Levodopa.
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Discovering the mistake, Mayberry attempted to remove the medicine from the
feeding tube. Malone did not report the incident to school administrators.
Following an investigation, Shawnee’s principal recommended that Malone be
terminated for his negligence. JCBE also reported the incident to the Education
Professional Standards Board (“EPSB”) pursuant to KRS1 161.120.
Facing termination, Malone, through the Jefferson County Teachers
Association (“JCTA”), negotiated with JCBE to resign on April 29, 2011, in
exchange for the removal of the performance evaluations and suspension letter
from his personnel file. On April 25, 2011, Malone tendered a letter of
resignation, effective May 1, 2011. Malone also notified school staff and parents
of his students he was resigning.
On May 11, 2011, almost two weeks after resigning, Malone
submitted to JCBE a “Notice of Intent to Retire,” effective July 2011. Malone
completed a Kentucky Teachers’ Retirement System “Application for Service
Retirement” and gave it to JCBE to complete Section IX-Certification by
Employer. Therein, JCBE represented Malone had earned zero days of sick leave.
The bottom of the section contained a certification which was completed and
signed by a JCBE representative:
I hereby certify that the employee named in this
application has terminated his/her contract and the last
1
Kentucky Revised Statutes.
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date of performed duties is April 29, 2011. The
employee requests retirement from the Kentucky
Teachers’ Retirement System in accordance with the
provisions of the Kentucky Revised Statutes to begin on
July 1, 2011. I further certify that the above information
is accurate and complete to the best of my knowledge.
On May 31, 2011, Malone sent a letter to JCBE questioning why he
did not receive any retirement benefits in the form of payment for accumulated
sick days. JCBE responded that Malone was ineligible for the unused sick leave
payout benefit extended to retirees because Malone had resigned, citing the JCTA
labor agreement.
Pursuant to Article 27, Section C of the labor agreement between
JCBE and JCTA:
Upon retirement from the Jefferson County Public
School District, a teacher shall receive thirty (30) percent
of the teacher’s unused accumulated sick leave as a cash
payment (less appropriate deductions) up to a maximum
equal to the teacher’s accumulated sick leave on the
thirtieth (30) year of credited service in the teacher’s
retirement systems. The cash payment shall be
calculated by using the teacher’s last year of service daily
rate.
The heading of Section C contains a footnote qualifying that the section applies to
“regular full-time teachers working on limited or continuing contracts and other
full-time employees.”
On May 25, 2012, Malone filed a complaint in the Jefferson Circuit
Court alleging he was constructively discharged for “refus[ing] to comply with
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illegal actions requested by his Vice Principal, with regard to state-mandated
student portfolios.” Malone further alleged JCBE breached the JCBE-JCTA labor
agreement and the resignation agreement by failing to pay him for the unused sick
days he was entitled to under the contract and reporting the allegations of his
misconduct to the EPSB. The complaint asserted claims for breach of contract,
breach of implied covenant of good faith and fair dealing, fraudulent inducement,
tortious interference with a prospective advantage, state wage and hour law
violations, and wrongful discharge.
Following a period of protracted discovery disputes, Malone moved
for partial summary judgment on his wage and hour claim. JCBE made a counter-
motion for partial summary judgment to dismiss the claim. The circuit court
granted JCBE’s motion and dismissed the claim. Subsequently, JCBE moved for
summary judgment on the remaining claims, and the circuit court granted the
motion. This appeal followed. Additional facts will be set forth below as
necessary.
The standard of review on appeal of a summary judgment is whether
the trial court correctly found there were no genuine issues as to any material fact
and that the moving party was entitled to judgment as a matter of law. CR2 56.03.
“The record must be viewed in a light most favorable to the party opposing the
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Kentucky Rules of Civil Procedure.
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motion for summary judgment and all doubts are to be resolved in his favor.”
Steelvest, Inc. v. Scansteel Service Center, Inc., 807 S.W.2d 476, 480 (Ky. 1991)
(citations omitted). “Because summary judgment involves only legal questions and
the existence of any disputed material issues of fact, an appellate court need not
defer to the trial court’s decision and will review the issue de novo.” Lewis v. B &
R Corporation, 56 S.W.3d 432, 436 (Ky. App. 2001) (citation omitted).
Malone advances six arguments in support of his contention that
summary judgment was improperly granted: 1) the circuit court erred in failing to
view evidence in the light most favorable to him; 2) the circuit court erred in
holding he is not entitled to sick leave payout pursuant to the parties’ employment
contract or statute; 3) the circuit court erred in holding JCBE did not breach its
contract in reporting his alleged misconduct to the EPSB; 4) the circuit court erred
in failing to consider his declaration made pursuant to 28 U.S.C.3 § 1746 in
response to the summary judgment motion; 5) the circuit court erred in granting
summary judgment on his fraudulent inducement claim; and 6) the circuit court
erred in failing to address JCBE’s intentional destruction and withholding of
evidence.
Read together, these allegations appear to encompass every claim
asserted in Malone’s complaint. Therefore, for conciseness, we will address them
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United States Code.
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as we review the circuit court’s grant of summary judgment as to each individual
claim.
Turning first to the wage and hour law claim, Malone contends JCBE
violated KRS 337.055, KRS 337.060(1) and KRS 337.010(1)(c)1 by not
compensating him for 30% of his earned sick leave pursuant to the JCBE-JCTA
labor agreement. KRS 337.055 provides in relevant part: “Any employee who
leaves or is discharged from his employment shall be paid in full all wages or
salary earned by him[.]” Further, KRS 337.060(1) states that “[n]o employer shall
withhold from any employee any part of the wage agreed upon.” Finally, KRS
337.010(1)(c)1 defines “[w]ages” as “any compensation due to an employee by
reason of his or her employment, including salaries, commissions, vested vacation
pay, overtime pay, severance or dismissal pay, earned bonuses, and any other
similar advantages agreed upon by the employer and the employee or provided to
employees as an established policy.” (Emphasis added.)
Reading these statutes together, the circuit court correctly concluded
that JCBE’s failure to compensate Malone for his earned sick leave would
constitute a violation of the wage and labor laws if Malone were entitled to such
payment pursuant to the JCBE-JCTA labor agreement. However, the court went
on to hold that “Malone is not eligible for the unused sick leave pay out benefits
extended to retirees under Article 27, § C, of the JCBE-JCTA Labor Agreement as
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a matter of law, since he was not a regular full-time teacher working on a limited
or continuous contract when he gave his notice of his intent to retire.” Thus, the
court concluded there was no violation of statute, and JCBE was entitled to
summary judgment. We agree.
“The interpretation of a contract, including determining whether a
contract is ambiguous, is a question of law to be determined de novo on appellate
review.” Kentucky Shakespeare Festival, Inc. v. Dunaway, 490 S.W.3d 691, 695
(Ky. 2016) (citation omitted). “In the absence of ambiguity, a written instrument
will be enforced strictly according to its terms, and a court will interpret the
contract’s terms by assigning language its ordinary meaning and without resort to
extrinsic evidence.” Id. at 694 (citation and internal quotation marks omitted).
“A contract is ambiguous if a reasonable person would find it
susceptible to different or inconsistent interpretations.” Maze v. Bd. of Directors
for Commonwealth Postsecondary Educ. Prepaid Tuition Tr. Fund, 559 S.W.3d
354, 363 (Ky. 2018) (citation omitted). “The fact that one party may have intended
different results, however, is insufficient to construe a contract at variance with its
plain and unambiguous terms.” Id. (citation omitted).
Article 27, Section C of the JCBE-JCTA labor agreement is clear and
unambiguous. Pursuant to that section, teachers are entitled to 30% of their unused
accumulated sick leave upon retirement. The agreement does not provide that
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employees are entitled to accumulated sick leave upon resignation. It is undisputed
that Malone resigned effective May 1, 2011, almost two weeks before he submitted
his notice of intent to retire, signifying that he recognized resignation and
retirement as separate actions.
Further, the heading to Section C contains a footnote qualifying its
application to “regular full-time teachers working on limited or continuing
contracts and other full-time employees.” The agreement itself does not define
“continuing contract”; however, KRS 161.720(4) provides that a “continuing
service contract” is a contract for the employment of a teacher which remains in
effect until the teacher “resigns or retires” or the “contract is terminated or
suspended as provided in KRS 161.790 and 161.800[.]” Because Malone had
already resigned, he was not “a regular full-time teacher[] working on [a] limited
or continuing contract[]” when he gave his notice of intent to retire. Thus, as a
matter of law, he was not entitled to the value of his accumulated sick leave
pursuant to the plain terms of the agreement.
Likewise, summary judgment was also appropriate as to Malone’s
breach of contract claim and his claim for breach of implied covenant of good faith
and fair dealing. In his complaint, Malone alleges that JCBE breached the JCBE-
JCTA labor agreement as well as the resignation agreement negotiated by JCTA
and entered into between Malone and JCBE.
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“To prove a breach of contract, the complainant must establish three
things: 1) existence of a contract; 2) breach of that contract; and 3) damages
flowing from the breach of contract.” Metro Louisville/Jefferson Cty. Gov’t v.
Abma, 326 S.W.3d 1, 8 (Ky. App. 2009) (citation omitted). As to the labor
agreement, as held above, Malone was not entitled to accumulated sick leave
pursuant to the terms of the agreement because he resigned prior to submitting his
notice of intent to retire. Therefore, he cannot prove a breach of the agreement
based on JCBE’s refusal to compensate him.
Concerning the resignation agreement, Malone argues that JCBE
breached the agreement by reporting the allegations of his misconduct to the
EPSB. The resignation agreement, in its entirety, reads as follows:
The Parties hereby agree:
1. Ted Malone will resign his position effective close of
business April 29, 2011;
2. The Form E-2 and letter, referencing disciplinary
action, will be removed from the personnel file;
3. This settlement is the complete resolution of all issues
related to the subject of this memorandum of agreement
and JCTA will not support any other grievance
concerning this issue.
Malone interprets “this settlement is the complete resolution of all
issues related to the subject of this memorandum of agreement” as JCBE’s
agreement it would not take any further action in relation to his misconduct.
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Without considering the reasonableness of this interpretation, “contracts of public
bodies, including boards of education, are made with reference to existing statutes
and [] the applicable statutory provisions enter into the contracts by operation of
law.” Bd. of Educ. of Perry Cty. v. Jones, 823 S.W.2d 457, 459 (Ky. 1992).
KRS 161.120(2)(a) requires JCBE to send a written report to the
EPSB concerning any teacher “who resigns from, or otherwise leaves, a position
under threat of contract termination . . . or who otherwise may have engaged in any
actions or conduct while employed in the school district that might reasonably be
expected to warrant consideration for action against [a] certificate[.]” JCBE’s
compliance with this duty was not a breach of contract, and summary judgment as
to this issue was properly granted.
Similarly, Malone argues that JCBE breached the covenant of good
faith and fair dealing “by intentionally withholding critical information from
Malone, and then . . . submitting false allegations of misconduct to the EPSB[.]”
“Within every contract, there is an implied covenant of good faith and fair dealing,
and contracts impose on the parties thereto a duty to do everything necessary to
carry them out.” Farmers Bank & Tr. Co. of Georgetown, Kentucky v. Willmott
Hardwoods, Inc., 171 S.W.3d 4, 11 (Ky. 2005) (citation omitted).
Malone essentially argues that by reporting his misconduct to the
EPSB, JCBE did not do everything in its power to fulfill its promise that the
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agreement would be “the complete resolution of all issues related to the subject of
[his misconduct].” Malone, again, appears to interpret the resignation agreement
as assuring him that JCBE would not take any further action against him. As held
above, JCBE did not breach the agreement by reporting Malone’s misconduct to
the EPSB. That reporting obligation was part of the contract. As such, JCBE did
not, and could not, breach the covenant of good faith and fair dealing by doing so.
The circuit court properly granted summary judgment as to this claim.
Summary judgment was also appropriate as to Malone’s fraudulent
inducement claim. Malone argues that he relied upon JCBE’s representation that
he would be fired for his misconduct in administering medication to his student
when he signed the resignation agreement. “In Kentucky, a party claiming harm
resulting from fraud in the inducement must establish six elements of fraud by
clear and convincing evidence as follows: a) material representation b) which is
false c) known to be false or made recklessly d) made with inducement to be acted
upon e) acted in reliance thereon and f) causing injury.” Bear, Inc. v. Smith, 303
S.W.3d 137, 142 (Ky. App. 2010) (citing United Parcel Service Co. v. Rickert, 996
S.W.2d 464, 468 (Ky. 1999)).
Here, there is no evidence JCBE made any false representation to
induce Malone to sign the agreement. Malone points to Mayberry’s April 10, 2018
statement to JCBE that she was the one who technically delivered the medication
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to the student. Thus, Malone asserts that any allegation or reporting that it was he
who administered the medicine is false. This appears to be semantics. Malone
was responsible for preparing and administering the student’s medication daily.
According to Mayberry’s affidavit, it was Malone who prepared and handed the
medicine to Mayberry, which she then gave the student.
In recommending that Malone be terminated, Shawnee Principal
Keith Look observed
Mr. Malone’s negligence my [sic] omission is in
violation of [Kentucky] statute. His failure to follow
JCPS procedures of reading labels repeatedly to assure
the correct med goes in the correct dosage to the correct
student put the student in severe danger. His failure to
report the error and to complete the form only when
asked raises danger as well.
Further, the record shows that Malone had not been administering the
student’s Valium, as required, for several weeks. Thus, Malone has not shown
evidence supporting his claim of fraudulent inducement.
Turning to Malone’s claim for tortious interference with a prospective
business advantage, to succeed on such a claim, a plaintiff must prove: “1) the
existence of a valid business relationship or expectancy; 2) that the defendant was
aware of this relationship or expectancy; 3) that the defendant intentionally
interfered; 4) that the motive behind the interference was improper; 5) causation;
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and 6) special damages.” Seeger Enterprises, Inc. v. Town & Country Bank & Tr.
Co., 518 S.W.3d 791, 797 (Ky. App. 2017) (citation omitted).
Malone argues that he had a “valid business relationship or its
expectancy” with respect to his retirement benefits and potential teaching
opportunities elsewhere and that JCBE’s actions “vis-à-vis the retirement benefits”
and “in making intentionally false allegations to the EPSB” interfered with these
expectations.
As held above, Malone was not entitled to receive sick leave payout,
and there is no evidence JCBE made any false allegations to the EPSB. Malone’s
quibble about the meaning of “administer” does not create a genuine issue of
material fact as to this or any other of his claims. Further, to prove tortious
interference with a prospective business advantage, a party seeking recovery must
show malice, meaning “intentional interference without justification.” PBI Bank,
Inc. v. Signature Point Condominiums LLC, 535 S.W.3d 700, 715 (Ky. App. 2016)
(citation omitted). Malone cannot meet this burden because JCBE was statutorily
required to report his misconduct to the EPSB. Therefore, summary judgment was
properly granted.
Finally, summary judgment was also appropriate as to Malone’s claim
for wrongful discharge. “To establish a cause of action for wrongful discharge, an
employee must show that the termination was contrary to public policy evinced by
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a constitutional or statutory provision[4], or that the discharge directly resulted from
the employee’s refusal to violate the law during the course of his employment.”
Greissman v. Rawlings & Assocs., PLLC, 571 S.W.3d 561, 566 (Ky. 2019) (citing
Grzyb v. Evans, 700 S.W.2d 399, 401 (Ky. 1985)).
We first point out that Malone was not “discharged,” but instead
negotiated his resignation with the assistance of the JCTA. Malone appears to
recognize this fact, alleging instead that he was “constructively discharged” for
refusing to “engage in illegal activities related to his students’ portfolios.” A
constructive discharge occurs when “based upon objective criteria, the conditions
created by the employer’s action[s] are so intolerable that a reasonable person
would feel compelled to resign.” Brooks v. Lexington-Fayette Urban County, 132
S.W.3d 790, 807 (Ky. 2004) (citation omitted).
Here, there is no evidence that Malone’s working conditions were so
intolerable as to compel resignation; in fact, the evidence shows that Malone
resigned to avoid being terminated for cause. Malone states in his sworn
declaration that when given the option to resign in lieu of termination, he told
Principal Look that he wanted to keep working. Based upon this admission, no
4
JCBE argues that Malone’s wrongful discharge claim fails as a matter of law because it is
based on 703 Kentucky Administrative Regulations (“KAR”) 5:080, a regulation, not a
constitutional or statutory provision. For purposes of this appeal we will assume 703 KAR
5:080 qualifies as public policy for purposes of a wrongful discharge claim.
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reasonable factfinder could conclude that Malone felt his workplace was so
intolerable that he felt compelled to resign. Further, facing termination, Malone
agreed to resign in exchange for a clean personnel file, allowing him to continue to
teach elsewhere. This evidence again fails to support a claim for constructive
discharge because it does not relate to work environment but instead shows
Malone’s resignation was a calculated decision based upon a potential benefit.
Even assuming Malone was constructively discharged, Malone’s
claim for wrongful discharge still fails because he cannot show that he was asked
to violate the law or, at the time of his resignation, had a reasonable, good-faith
belief that he had been asked to do so. In an unpublished Opinion, a panel of this
Court held that “an employee claiming wrongful discharge due to a refusal to
violate the law must show an affirmative request to him/her by the employer to
violate the law.” Welsh v. Phoenix Transp. Servs., LLC, No. 2007-CA-001231-
MR, 2009 WL 2475206 (Ky. App. Aug. 14, 2009) (ordered not to be
published) (Ky. Mar. 10, 2010).
Malone cannot meet this requirement. While Malone argues JCBE’s
instructions to manipulate and tamper with student portfolios violated 703 KAR
5:080, the Kentucky Department of Education (“KDE”) determined otherwise.
After investigating Malone’s allegations, the KDE concluded that
since the re-administration of the baseline assessment
probes was approved by KDE staff and based on
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evidence that several of the baseline probes Mr. Malone
originally administered did not align with the grade level
assessment standards for the assessed content areas, there
is not enough evidence to support a violation of 703
KAR 5:080.
In Greissman, 571 S.W.3d 561, our Supreme Court, at least implicitly,
acknowledged that a wrongful discharge claim for refusal to violate the law could
stand if an employee had a “reasonable, good faith belief” the request was illegal.
Id. at 568. Again, Malone cannot show that he had a reasonable, good faith belief
that he had been asked to violate the law, at least not at the time of his resignation.
While Malone alleges that he contacted Dan Pike, another JCBE
employee, as well as Kevin O’Hair from KDE, and was informed that
manipulating student portfolios would be illegal, in an email provided as an exhibit
to Malone’s response to the summary judgment motion, O’Hair states he informed
Malone on April 6, 2011, that altering the portfolios under the circumstances as
they existed was permitted. Thus, viewing the evidence in the light most favorable
to Malone, at the time of his resignation, Malone’s belief that he was being asked
to violate 703 KAR 5:080 was no longer reasonable or in good faith. Thus, it
could not have reasonably informed his decision to resign.
Malone also argues the circuit court erred in failing to consider his
declaration made pursuant 28 U.S.C. § 1746 to rebut JCBE’s summary judgment
motion. While the circuit court concluded the document was not affirmative
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evidence because it was unverified, the court proceeded to address Malone’s
arguments as if supported by affirmative evidence. Therefore, we decline to
address this issue.
Lastly, Malone argues the circuit court erred in failing to address
JCBE’s intentional destruction and withholding of evidence. During discovery,
Malone repeatedly alleged that JCBE violated both state law and school policy
concerning record retention. Malone filed numerous motions to compel, most of
which were granted by the circuit court. In his notice of appeal, Malone lists six
different discovery orders he is appealing from. However, they are not addressed
in his brief. It is unknown, therefore, specifically what relief he seeks.
Importantly, Malone does not state how any alleged missing evidence is relevant or
how he has been prejudiced by its absence.
“[I]t is well-settled that a trial court has broad discretion in resolving
disputes in the discovery process, and we will not disturb a discovery ruling absent
an abuse of that discretion.” Blue Movies, Inc. v. Louisville/Jefferson Cty. Metro
Gov’t, 317 S.W.3d 23, 39 (Ky. 2010) (citation omitted). Because Malone has not
identified any specific error of the circuit court with regard to discovery, we
decline to find it abused its discretion.
For the foregoing reasons, the orders of the Jefferson Circuit Court are
affirmed.
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ALL CONCUR.
BRIEFS FOR APPELLANT: BRIEF FOR APPELLEE:
James M. Morris C. Tyson Gorman
Tyler J. Morris Sean G. Williamson
Lexington, KY Louisville, KY
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