A Capehart Scatchard Blog

Contract Rescission Does Not Avoid Need for Public Notice and Hearing

By on March 15, 2019 in Labor & Employment with 0 Comments

By: Robert A. Muccilli, Esq.
Editor: Sanmathi (Sanu) Dev, Esq.

Statutes are to be read sensibly rather than literally. This was the message sent by the New Jersey Appellate Division on March 14, 2019 in Wall Township Education Association v. Board of Education of the Wall Township School District when it reversed the Commissioner of Education’s decision and held that a superintendent and school district may not avoid the requirements for public comment and public hearing under N.J.S.A. 18A:11-11 simply by rescinding an existing superintendent employment contract.

The Superintendent had a contract which was to expire on June 30, 2019. After new salary caps were put in place, the Superintendent and the Wall Township Board of Education (“Board”) agreed in principle to rescind the Superintendent’s five-year contract and approve a three year contract in its place that provided for increased compensation in accordance with the new caps. The Executive County Superintendent approved the new contract, and the Board, following direction from the Executive County Superintendent, voted to approve the contract without public notice and a public hearing. N.J.S.A. 18A:11-11 requires notice and a public hearing when a board renegotiates, extends, amends, or otherwise alters the terms of a contract with a superintendent and certain other school administrators.

Trouble came quickly. The Wall Township Education Association (“Association”), certain members of the Association, and a taxpayer in the school district challenged the Board’s action through a petition of appeal. The Commissioner dismissed the petition. The Commissioner adopted the administrative law judge’s recommended decision which concluded that the Board’s action constituted a rescission of the contract and that there was no amending, extending, or altering of the terms which would trigger the statute’s notice and hearing requirements.

The Appellate Division reversed the Commissioner on appeal. It directed the Board to vote on a new employment contract for the Superintendent subject to satisfying the public notice and public hearing requirements of N.J.S.A. 18A:11-11. In reaching its decision, the Court primarily relied upon a rule of statutory construction which provides that where a literal rendering will lead to a result not in accord with the essential purpose of the act, the spirit of the law will control. The Court found that the purpose of N.J.S.A. 18A:11-11 is to provide greater transparency between the public and boards of education with respect to employment contracts of certain administrators by requiring public notice and a public hearing when the board renegotiates, extends, amends, or alters an existing contract with its superintendent. The Court concluded that renegotiation and alteration were exactly what occurred in the case, and that a mutual rescission cannot be used to circumvent the statute’s requirements. Otherwise the result would be absurd since boards could routinely avoid the requirements by executing a contract rescission. The Court also relied upon the fact that the original contract had not “expired” thus pulling the exception to the notice and hearing requirements in an instance where the contract is a replacement for an expired contract.

Boards that have followed the same path taken by the Wall Township Board of Education should consult with their solicitor about whether corrective action is necessary.

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Robert Muccilli

About the Author

About the Author:

Robert A. Muccilli, Esq. is Co-Chair of Capehart Scatchard’s School Law Group and a Shareholder in the Labor and Employment Group. For over 25 years, he has focused his practice in the areas of school law, and labor and employment. He has represented school districts with respect to a variety of education law issues involving students, teachers, school construction and special education issues including questions pertaining to inclusion, least restrictive environment, discipline, behavior management, transition, evaluation, discrete trial instruction, medically fragile students, dyslexia, Down Syndrome, Aspergers Syndrome, and equal access to activities and services for disabled individuals. He has also been recognized as one of South Jersey’s Top Attorneys as published by SJ Magazine. Mr. Muccilli is admitted to practice law in New Jersey, the United States District Court for the District of New Jersey and Washington, DC.

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