Jesse A. Vail v. Board of Education of Paris Union School District No. 95, Terrance C. Parks, Charles R. Fox and Bernie Rinehart

706 F.2d 1435, 1983 U.S. App. LEXIS 28724, 11 Educ. L. Rep. 410

• Court: Court of Appeals for the Seventh Circuit
• Decided: April 19, 1983
• Docket: 82-1202
• Status: Published

Opinions

HARLINGTON WOOD, Jr., Circuit Judge.

In this § 1983 action this court must once again address the meaning of “property” as used in the Due Process Clause. The district court in a bench trial awarded $19,-850.99 in damages for the unlawful termination of the plaintiff-appellee from a position in the school system of Paris, Illinois. We affirm.

I.

This case arose because of the efforts of the Board of Education of Paris Union School District No. 95 (Board) to secure the services of the plaintiff-appellee Jesse A. Vail (Vail) as an athletic director and football coach. At the time the Board sought his services Vail was employed as supervisor of recreation and physical education for the Stateville Correctional Center in Joliet, Illinois.

On June 15, 1980 a search committee for the Board traveled to Joliet. They held a breakfast meeting with Vail, visited his place of employment, and later met with Vail in his home. In addition to talking about the nature of the job duties and the salary, discussion between the search committee and Vail centered on job security and the length of the term of the proposed contract.

Vail was concerned about the amount of time necessary to correct deficiencies that existed in the athletic program in Paris as well as giving up his job at Stateville. In response to these concerns the committee stated that the length of the term of the contract was a matter to be determined by the full Board and that the committee itself could make no commitment beyond one year.

According to the findings of fact, on June 24,1980 the Board met in special session to consider hiring Vail. At that meeting the Board unanimously agreed to offer Vail a contract of employment as athletic director and football coach. It was the consensus of the Board that it would assure Vail of two years in that position.

The Board instructed Dr. James Cherry, the superintendent, to convey an offer to Vail and to explain the Board’s intention to renew the one-year contract at the end of the first year. Vail was informed of the offer and told that while the Board could not offer him more than a one year contract, it could assure him of extending the contract for a second year. Vail accepted, traveled to Paris to execute a written contract, and subsequently assumed the duties of athletic director and football coach.

On March 2,1981 the Board met in public session and voted not to renew Vail’s contract for the ensuing year. Vail was not given any explanation as to the reason for his termination, nor was he given any sort of a hearing.

II.

On these findings of fact the district court held that Vail had a constitutionally protected property interest in his continued employment with the Board. Citing Perry v. Sindermann, 408 U.S. 593, 92 S.Ct. 2694, 33 L.Ed.2d 570 (1972), the court held that the Board acting under color of state law had deprived Vail of property without due process of law and awarded $19,850.99 in stipulated damages.

The Board’s principal argument on appeal is that the district court erred in concluding that Vail had any constitutionally sufficient property interest to state a claim under 42 U.S.C. § 1983. The Board contends that Vail had no more than a mere subjective expectation of continued employment and his sole rights as a new teacher are governed by Illinois law which only requires the Board to give 60 days notice before the end of a school term of its decision to terminate.¹

The nature of property interests to be protected by the Due Process Clause of the Constitution has been addressed in many contexts by the Supreme Court. Most relevant to the present case are a pair of cases where the Court assessed the property interests of two state university professors each terminated at the end of a one-year contract without a hearing. In Board of Regents v. Roth, 408 U.S. 564, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972), the Court held that a teacher terminated after , one year had no property interest in his continued employment where his unilateral expectations had no basis in statute, contract, or mutually explicit understanding with the university. Id. at 578, 92 S.Ct. at 2709. In the companion case, Perry v. Sindermann, 408 U.S. 593, 92 S.Ct. 2694, 33 L.Ed.2d 570 (1972), the plaintiff had been terminated after having worked for a number of years under a series of one-year contracts. Here the Court found a property interest in continued employment that had been fostered by the rules and the policy of the university, despite the lack of tenure or a contractual provision. Id. at 599-601, 92 S.Ct. at 2698-2699.

In defining the nature of a protected property interest Justice Stewart stated in Sindermann:

We have made clear in Roth, that “property” interests subject to procedural due process protection are not limited by a few rigid, technical forms. Rather “property” denotes a broad range of interests that are secured by “existing rules or understandings.” A person’s interest in a benefit is a “property” interest for due process purposes if there are such rules or mutually explicit understandings that support his claim of entitlement to the benefit and that he may invoke at a hearing.

408 U.S. at 601, 92 S.Ct. at 2699 (citations omitted). Justice Stewart went on to state that the “existing rules or understandings” need not be a formal tenure system or even an explicit contractual provision, citing implied contracts as sufficient to constitute a protected property interest. Id. at 601-02, 92 S.Ct. at 2699-2700. See also Connell v. Higginbotham, 403 U.S. 207, 91 S.Ct. 1772, 29 L.Ed.2d 418 (1971) (applying due process to teacher without tenure or a formal contract but with a clearly implied promise of continuing employment).

Sindermann does not turn on the implied contractual provision being one of tenure. The case law clearly establishes that a property interest can be created through a statutory entitlement, the operation of institutional common law, or through principles of contract law. In addition to Sindermann the Supreme Court has stated explicitly: “A property interest in employment can, of course, be created by ordinance or by an implied contract.” Bishop v. Wood, 426 U.S. 341, 344, 96 S.Ct. 2074, 2077, 48 L.Ed.2d 684 (1976). Accord, Jago v. Van Curen, 454 U.S. 14, 18-19, 102 S.Ct. 31, 34-35, 70 L.Ed.2d 13 (1981) (per curiam); Leis v. Flynt, 439 U.S. 438, 442, 99 S.Ct. 698, 700, 58 L.Ed.2d 717 (1979) (per curiam). It is the binding nature of the contract rather than its length which is significant. This circuit has also stated rather bluntly: “A term of employment set by contract has been recognized as a property interest which the state cannot extinguish without conforming to the dictates of procedural due process.” Hostrop v. Board of Junior College District No. 515, 471 F.2d 488, 494 (7th Cir.1972), cert. denied, 411 U.S. 967, 93 S.Ct. 2150, 36 L.Ed.2d 688 (1973). Accord, Adams v. Walker, 492 F.2d 1003 (7th Cir. 1974).

In this case we deal with the unlawful termination of a government employee, not some other matter of state business, a subject which the Supreme Court repeatedly has held to implicate constitutional rights under both the “property” and the “liberty” interests protected by the Due Process Clause. Arnett v. Kennedy, 416 U.S. 134, 94 S.Ct. 1633, 40 L.Ed.2d 15 (1974); Roth, supra; Sindermann, 408 U.S. at 597, 92 S.Ct. at 2697 and cases cited therein; Cafeteria Workers v. McElroy, 367 U.S. 886, 81 S.Ct. 1743, 6 L.Ed.2d 1230 (1961). Cf. Hampton v. Mow Sun Wong, 426 U.S. 88, 102, 96 S.Ct. 1895, 1904, 48 L.Ed.2d 495 (1976) (liberty interest in obtaining government employment). When the government acts as employer, the application of the Due Process Clause protects the individual from arbitrary and capricious conduct and legitimizes governmental action when exercised through proper channels.

Vail had a two-year employment promise rather than a commitment for indefinite employment, as in the case of tenure. The length of time that an individual retains an asset affects the weight or value of the interest, but not the nature of the interest. Had Vail been successful in rebuilding the school’s athletic program to the school’s satisfaction, as no doubt all parties hopefully anticipated, Vail would have benefited after two years from statutory tenure, as do other teachers. Athletic directors and coaches are generally not regarded as second class members of a balanced school program. Roth, 408 U.S. at 570-71, 92 S.Ct. at 2705-06. We affirm the finding that the Board deprived Vail of hifc legitimate expectation of continued employment in terminating him without cause before the expiration of his employment period, and that such deprivation is a violation of due process and actionable under the Civil Rights Act.

The Board argues that under Illinois law there was no evidence of an implied employment contract for two years. Under Illinois law, an implied contract is proven by circumstances showing that the parties intended to contract or by facts and circumstances from which a meeting of the minds can be inferred. See generally, 12 Illinois Law & Practice Contracts § 4 (1982); United States ex rel. J.C. Schaefer Electric, Inc. v. O. Frank Heinz Construction Co., 300 F.Supp. 396 (S.D.Ill.1969); Arthur Rubloff & Co. v. Drovers National Bank, 80 Ill.App.3d 867, 36 Ill.Dec. 194, 400 N.E.2d 614 (1st Dist.1980). While it is true that property interests stem from rules and understandings governed by state law, the Illinois law of implied contracts is quite sufficient in this case to create a property interest protected under 42 U.S.C. § 1983.

What the Board actually challenges is the district court’s findings of fact. After analyzing conflicting evidence on the question of the deliberations of the Board and the representations made to Vail concerning the length of his employment, the district court credited the testimony of certain Board members, Davis and McHenry. This decision was based on the demeanor of the witnesses as well as lack of recollection and impeachment on certain points testified to by the opposing witnesses. A credibility finding is a finding of fact which, under Rule 52 of Federal Rules of Civil Procedure, “shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses.” Fed.R.Civ.P. 52. Based on the record in this case we cannot reverse these findings as clearly erroneous.

III.

The Board argues that even if an implied contract is found between Vail and the Board that the contract is unenforceable under Illinois law and therefore not sufficient to constitute a property interest. First, the Board contends that the provisions of the Illinois Teacher Tenure Act, Ill.Rev.Stat. ch. 122, § 24-11 (1979), preempt any property interest created by the implied, contract. Such a conclusion is not supported by § 24-11 or any other provision of the Illinois School Code, Ill.Rev.Stat. ch. 122, § 1-1 et seq. (1979).

Section 24-11 itself contemplates just such a two-year probationary period as was promised Vail. The statute states:

Any teacher who has been employed in any district as a full-time teacher for a probationary period of 2 consecutive school terms² shall enter upon contractual continued service unless given written notice of dismissal stating the specific reason, therefor, by registered mail by the employing board at least 60 days before the end of such period.

Ill.Rev.Stat. ch. 122, § 24-11 (1979). The fact that the same section provides a different procedure to terminate probationary teachers during their first year of teaching does not suggest that a two-year contract is not permitted under Illinois law.³ It is significant that Vail is not claiming any right to tenure under the Code which would have been extinguished by the actions of the Board in compliance with § 24-11. He merely claims an agreement for a two-year contract as promised by the Board. There is simply no provision of the Code placing an express statutory one-year time limit on contracts to be offered to probationary teachers.⁴

The Board also argues that any implied contract would be unenforceable because it arises from an ultra vires Board act. The appellants contend that a two-year contract would be an ultra vires limitation on the Board’s ability to terminate teachers at will. Appellants cite the provision of § 10-22.4 as granting the Board discretionary power to dismiss, or to fail to renew a teacher’s employment. While it is true that these powers cannot be delegated or contracted away to a third party, the Board’s exercise of its discretion in this case in offering a two-year contract in no way violates the express or implied requirement of § 10-22. See Libertyville Education Association v. Board of Education of School District No. 70, Lake County, 56 Ill.App.3d 503, 13 Ill.Dec. 741, 371 N.E.2d 676 (2d Dist.1977).

Appellant’s final contention is that the oral promise to renew employment after the first year is unenforceable under the Illinois Statute of Frauds.⁵ This argument has no merit given, under Illinois law, as elsewhere, the Statute of Frauds would not bar enforcement of the contract where there has been partial performance by the parties. Anastaplo v. Radford, 14 Ill.2d 526, 153 N.E.2d 37 (1958); Yorkville National Bank v. Schaefer, 71 Ill.App.3d 137, 27 Ill.Dec. 263, 388 N.E.2d 1312 (2d Dist.1979); Grundy County National Bank v. Westfall, 13 Ill.App.3d 839, 301 N.E.2d 28 (3rd Dist. 1973).

Even if we were to assume arguendo that no enforceable contract under state law existed between Vail and the Board, we are not prepared to hold that this alone precludes the establishment of a protected property interest. The Civil Rights Act itself speaks of actions taken under color of state law and not under authority of state law. The Supreme Court has stated:

Although the underlying substantive interest is created by “an independent source such as state law,” federal constitutional law determines whether that interest rises to the level of a “legitimate claim of entitlement” protected by the Due Process Clause.

Memphis Light, Gas & Water Division v. Craft, 436 U.S. 1, 9, 98 S.Ct. 1554, 1560, 56 L.Ed.2d 30 (1978).

More recently, the Court has refused to limit constitutional “property” rights to mere contract rights. Jago v. Van Curen, 454 U.S. 14, 102 S.Ct. 31, 70 L.Ed.2d 13 (1981). Legitimate and reasonable reliance on a promise from the state can be the source of property rights protected under the Due Process Clause and the civil rights statutes. Sindermann, 408 U.S. at 602, 92 S.Ct. at 2700. In Soni v. Board of Trustees of the University of Tennessee, 513 F.2d 347 (6th Cir.1975), cert. denied, 426 U.S. 919, 96 S.Ct. 2623, 49 L.Ed.2d 372 (1976), the court held that reasonable reliance on assurances and conduct by university officials that the plaintiff had a tenure track position was sufficient to create a property interest despite state law and university regulations which prohibited an alien from receiving such an appointment. See also Harris v. Arizona Board of Regents, 528 F.Supp. 987 (D.Ariz.1981). Our own decision in McElearney v. University of Illinois, Chicago Circle, 612 F.2d 285 (7th Cir.1979), is in no way inconsistent with this reliance standard given that the plaintiff in McElearney received only informal assurances thus failing to meet the legitimate and reasonable reliance necessary to create a property interest.

The actions of the Board worked to deny Vail’s legitimate expectations of continued employment. The extent of his reliance on the Board’s promise is shown by the fact he left Joliet where he and his family had lived for thirteen years, left a job he had held for ten years, and even took a salary cut to take the job in Paris. The reasonableness of the reliance is illustrated by the concerns over security Vail raised from his very first meeting with Dr. Cherry to the final actions of the Board and the promises Vail received as an inducement to taking the job.

Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981), held a claim was not stated under 42 U.S.C. § 1983 when certain hobby materials ordered by mail by an inmate of a Nebraska prison were not delivered to him due to the unauthorized failure of state agents to follow established state procedures. The remedy was found to lie under state law. In our recent decision in Wolf-Lillie v. Sonquist, 699 F.2d 864 (7th Cir.1983), we held that Parratt applied to that plaintiff’s § 1983 due process allegations. In that case the sheriff had executed a writ of restitution to seize plaintiff’s house trailer contrary to the state statute. In both Parratt and Wolf-Lillie the plaintiffs were relegated to post-deprivation state law tort remedies. Predeprivation hearings were neither practical nor appropriate in either case where clearly established state policies were involved and ignored due to negligence or otherwise. We see neither ease as controlling the present case. The Supreme Court had the opportunity but refused to expand Parratt beyond “a tortious loss of property or result of a random and unauthorized act by a state employee.” See Logan v. Zimmerman Brush Co., 455 U.S. 422, 102 S.Ct. 1148, 71 L.Ed.2d 265 (1982).

IV.

Finally, the appellants argue that the district court’s award of damages is improper. They contend that the proper remedy in this case is either a hearing to determine whether the termination was justified or a remand to have the plaintiff come forward with proof of actual losses.

The issue of “good cause” having been put into issue by the pleadings and fully tried and decided by the district court negates the need for any further proceedings on this issue. The district court’s finding that the Board was in breach of contract and, therefore, that Vail’s termination was not for good cause, distinguishes this case from Carey v. Piphus, 435 U.S. 247, 98 S.Ct. 1042, 55 L.Ed.2d 252 (1978). The stipulated damages awarded in this case adequately afford a remedy for the harm suffered from the deprivation of Vail’s property interest without due process of law.

V.

Accordingly, this case is

Affirmed.

1 . There is no contention that the Board failed to act in compliance with this requirement. See, infra, p. 1439.

2 . A term is defined as “the portion of the school year, July 1 to the following June 30, when school is in actual session.” Ill.Rev.Stat. ch. 122, § 24-11 (1979).

3 . The Board relies on the portion of that section which states:

Any full-time teacher who is completing the first year of the probationary period described in the preceding paragraph, or any teacher employed on a full-time basis not later than January 1 of the school term, shall receive written notice from the employing board at least 60 days before the end of any school term whether or not he will be re-employed for the following school term. If the board fails to give such notice, the employee shall be deemed re-employed, and not later than the close of the then current school term the board shall issue a regular contract to the employee as though the board had re-employed him in the usual manner.

4 . Appellant’s citation of our decision in McElearney v. University of Illinois, Chicago Circle, 612 F.2d 285 (7th Cir.1979), is therefore inapposite. First, and foremost, McEleamey received only “informal assurance” in contrast to. the instant case in which Vail received promises which rose to the level of an implied contract. Second, the explicit mies governing tenure in McElearney suggest that any reliance to be based on a supposed entitlement to tenure by virtue of the informal assurances McElearney received would be unreasonable. Finally, our holding in Hostrop v. Board of Junior College District No. 515, 523 F.2d 569 (7th Cir. 1975), cert. denied, 425 U.S. 963, 96 S.Ct. 1748, 48 L.Ed.2d 208 (1976), suggests that a cause of action for state action in violation of due process would exist even if Illinois law only permitted a one-year contract.

5 . Ill.Rev.Stat. ch. 59, § 1 (1981) states:

No action shall be brought . . . upon any agreement that is not to be performed within the space of one year from the making thereof, unless the promise .. . shall be in writing.