Handicapped Children’s Educ. Bd. v. Lukaszewski

Brief Fact Summary. Employee terminated her employment contract forcing her employer to hire a replacement at a higher salary.

Synopsis of Rule of Law. The non-breaching party is entitled to full compensation for the loss of the benefit of the bargain.

Facts. The Plaintiff, Handicapped Children’s Education Board (Plaintiff), hired the Defendant, Lukaszewski (Defendant), as a speech and language therapist. The Plaintiff offered to renew the Defendant’s contract and the Defendant accepted. However, prior to the beginning of the next school year, the Defendant accepted another job offer that paid a higher salary and that was closer to her home. The Plaintiff refused to release the Defendant from her contract. The Defendant then obtained a doctor’s note stating that she had high blood pressure and submitted a letter of resignation. She then began her new position. Only one qualified person applied to be the Defendant’s replacement. This applicant had more teaching experience than the Defendant and therefore, the Plaintiff was forced to pay her a hire salary. The Plaintiff filed suit against the Defendant for the difference in salary it was forced to pay when Defendant breached her contract.

Issue. Is an employer entitled to damages resulting from breach of an employment contract?

Held. Yes. Judgment reversed. The Defendant did breach her employment contract and therefore the Plaintiff is entitled to have the benefit of its bargain restored.

Dissent. The dissent disagrees with the court when it found that the Defendant breached her employment contract. Instead, the dissent argues that she legitimately terminated her employment contract due to health reasons.

Discussion. The court reasoned that damages resulting from breach of contract are measured by the expectations of the parties. The court rejected the Defendant’s argument that the Plaintiff was not damaged by her breach because it gained a more experienced teacher. The court found that the Plaintiff’s expectations were not to hire a more experienced teacher. Instead it expected to receive the services specified in the Defendant’s contract for the salary specified in the Defendant’s contract. The court also reasoned that although Plaintiff had a duty to mitigate damages, since only one qualified applicant applied for the position, Plaintiff had done all it could to mitigate.