ATTORNEYS FOR APPELLANT: ATTORNEY FOR APPELLEE:
JEFFREY A. MODISETT KENNETH J. FALK
Attorney General of Indiana Indiana Civil Liberties Union
JANET BROWN MALLETT
Deputy Attorney General
SUELLEN REED, individually and in her ) official capacity as Indiana State Superintendent ) of Public Instruction, ) ) Appellant-Defendant, ) ) vs. ) No. 49A02-9807-CV-598 ) GEOFFREY F. SCHULTZ, ) ) Appellee-Plaintiff. )
required to (i) determine whether a child is disabled under the applicable laws, (ii) develop
individual educational programs for each disabled child, and (iii) offer support services that
will allow the child to benefit from the education.See footnote
Generally, the cost of the education is the
responsibility of the child's local public school.See footnote
If the child's disabilities require expenses
beyond those of children of the same age and grade level in the child's school corporation,
then the State Department of Education assumes responsibility for payment.See footnote
When a child's
parents or guardians disagree with a school's assessment of a child's disability or decision
regarding the implementation of an educational program, they have the right to an impartial
due process hearing before an independent hearing officer. A party may appeal an adverse
judgment of the hearing officer to the Board of Special Education Appeals.See footnote
is then available.See footnote
Federal and state law forbid the independent hearing officer from being an employee of the public agency involved in the education or care of the child.See footnote 7 Selection of an independent hearing officer in Indiana is governed by 511 I.A.C. 7-15-5, which provides in pertinent part:
(d) The state superintendent of public instruction shall appoint the independent
hearing officer. When a due process hearing request is received, the public
agency and the parent will be sent a written notice of the name of the
independent hearing officer who has been assigned to the matter.
(e) A person who may be appointed as an independent hearing officer shall:
(1) be trained in the due process hearing procedure;
(2) have no personal or professional interest that would conflict with the person's objectivity in the hearing; and
(3) not be an officer, employee, or agent of the public agency, the department of education, or any other agency that may be involved in the education or care of the student.
(f) A person who otherwise qualifies as a hearing officer is not considered an
employee of the agency solely because the person is paid by the agency to
serve as a hearing officer. The division of special education and the public
agencies shall maintain a current listing of the persons who serve as hearing
officers, including information on the qualifications of those persons.
Dr. Schultz as a hearing officer for an additional two-year period beginning March 1, 1995,
and ending March 1, 1997.
In 1996, Dr. Schultz presided over a hearing in case No. 881-96. In that case, the parents of a student sought reimbursement from the State Department of Education for educational expenses they had incurred. Dr. Schultz decided the case in the parents' favor and ordered the Department to reimburse the parents $121,021.12 based on his finding that special education laws had been violated. The Department appealed Dr. Schultz's decision to the Board of Special Education Appeals. The Board reversed Dr. Schultz's decision. At the conclusion of the hearing, the Board expressed concerns regarding Dr. Schultz's handling of the case and directed its attorney, Joel Hand, to contact Dr. Schultz. In a letter dated August 27, 1996, Hand informed Dr. Schultz that the Board found several of his findings of fact to be inaccurate in that they were not supported by the evidence and referred to incorrect dates. Hand also informed Dr. Schultz that when writing conclusions of law, it was inappropriate for a hearing officer to make arguments for or against a party or to express his or her personal feelings about a case. Hand further informed Dr. Schultz that the Board felt he may have exceeded the scope of his role as an independent hearing officer by attempting to define "educationally related services" rather than complying with the definitions provided in Article 7 of the Indiana Administrative Code. Hand delivered a copy of the letter to Superintendent Reed. On September 4, 1996, the Superintendent sent Dr. Schultz a letter informing him that she had received a copy of Hand's August 27, 1996, letter and was
directing the Division of Special Education to remove Dr. Schultz from the list of available
On December 16, 1996, Dr. Schultz filed a complaint under 42 U.S.C. § 1983 alleging that his right to due process of law had been violated because the Superintendent did not afford him adequate process before removing him from the list of hearing officers. The complaint sought declaratory as well as injunctive relief and damages. Thereafter the parties filed cross-motions for summary judgment. On March 20, 1998, the trial court granted partial summary judgment in favor of Dr. Schultz. The court found that the Superintendent's March 1, 1995, letter to Dr. Schultz created an understanding or implied contract over which Dr. Schultz had a property interest protected by the Due Process Clause of the Fourteenth Amendment. The court remanded the case to the Superintendent for a hearing in which the Superintendent would have to show cause for Dr. Schultz's removal from the list. The trial court finalized its ruling on May 14, 1998. This appeal followed.See footnote 8
Anderson Banking Co., 597 N.E.2d 1307, 1308 (Ind. Ct. App. 1992). On appeal, the
appellant bears the burden of proving that the trial court erred in determining that there are
no genuine issues of material fact and the moving party was entitled to judgment as a matter
of law. Etienne v. Caputi, 679 N.E.2d 922, 924 (Ind. Ct. App. 1997).
The requirements of procedural due process apply only to the deprivation of interests encompassed by the Fourteenth Amendment's protection of liberty and property. Board of Regents of State Colleges v. Roth, 408 U.S. 564, 569 92 S. Ct. 2701, 2705, 33 L. Ed. 2d 548 (1972). When protected interests are implicated, the right to some kind of prior hearing is paramount. Roth, 408 U.S. at 569-70, 92 S. Ct. at 2705. A protected property interest generally arises from a statute, ordinance, or contract. Speckman v. City of Indianapolis, 540 N.E.2d 1189, 1193 (Ind. 1989). Although a person does not have a federal due process right to a hearing prior to discharge merely because he is a public employee, id., nonetheless, a written contract with an explicit tenure provision is evidence of a formal understanding that supports a party's claim of entitlement to continued public employment unless sufficient cause is shown. Perry v. Sindermann, 408 U.S. 593, 602, 92 S. Ct. 2694, 2700, 33 L. Ed. 2d 570 (1972). An entitlement may also be shown by an implied agreement gleaned from the promisor's words and conduct in light of the surrounding circumstances, and the meaning of the promisor's words and acts as found by relating them to the usage of the past. Id. See footnote 9
whether an interest in property rises to the level 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). To determine whether due process requirements apply, courts must
look not to the weight but to the nature of the interest at stake. Roth, 408 U.S. at 571, 92 S.
Ct. at 2705-06 (1972). A court must look to see if the interest is within the Fourteenth
Amendment's protection of liberty and property. Id. 408 U.S. at 571, 92 S. Ct. at 2706.
As the Superintendent points out in her brief, placement on the list was no guarantee that Dr. Schultz would be assigned hearings.See footnote 10 Any agreement between the parties must be considered in conjunction with applicable statutes that govern the relationship. Lutz v. New Albany City Plan Comm'n, 230 Ind. 74, 101 N.E.2d 187, 191 (1951). The governing provisions of Indiana law do not guarantee or even contemplate appointment of hearing officers by the Superintendent beyond each individual case.See footnote 11 Further, neither the letter before us nor the course of dealing between the parties guaranteed that the Superintendent would select Dr. Schultz to preside over any cases. In like fashion, neither the letter nor the parties' course of dealing placed any requirement upon Dr. Schultz to accept future case assignments. Rather, the substance of the agreement between the parties was that the Superintendent agreed to place Dr. Schultz on a list for service as a Special Education
Hearing Officer, and Dr. Schultz agreed to serve if and when called. It is true that at the time
Dr. Schultz was removed, the Superintendent used a rotation system for selecting hearing
officers from the list. However, whether he was ever called into service was left strictly to
the discretion of the Superintendent. See 511 I.A.C. 7-15-5(d). Within this discretion
necessarily includes the option to do away with the rotation system, to place more persons
on the available list thereby greatly decreasing the number of hearings available to Dr.
Schultz, or simply to choose not to assign cases to Dr. Schultz. Cf. Pritchett v. Alford, 973
F.2d 307, 316-18 (4th Cir. 1992) (Wrecker service had property interest in remaining on list
of towing companies utilized by police where regulations required police to use a rotation
system when selecting a company and only those towing companies called by police were
entitled to respond to an accident.). When an official action is truly discretionary under local
law, "one's interest in a favorable decision does not rise to the level of a property right
entitled to procedural due process protection." Walentas, 862 F.2d at 419 (quoting RR
Village Ass'n, Inc. v. Denver Sewer Corp., 826 F.2d 1197, 1202 (2d Cir.1987) (citations
omitted)). Furthermore, Dr. Schultz received no compensation for being on the list and was
paid by the public agency involved in the hearing only after he was assigned and presided
over a case.
Dr. Schultz relies on cases finding a protected right to continued employment to support his claim. However, Dr. Schultz's asserted interest is not in continued employment or even the assignment of cases. Instead, the interest claimed is the right to remain on a list of persons to be considered for hearing assignment. As such, his case is readily
distinguishable from cases where a protected property interest was found in continued public employment guaranteed by contract or agreement.See footnote 12 In this context, the United States Supreme Court has carefully limited its decisions in which due process rights are implicated to situations that involve employment contracts with tenure provisions, or where a clearly implied promise of continued employment has been made. Walentas, 862 F.2d at 418; see Perry, 408 U.S. at 600-01, 92 S. Ct. at 2699-700. An interest in continuing employment guaranteed by contract or understanding is far more significant and based on a much greater degree of certainty than Dr. Schultz's mere expectation that he would be assigned cases without guarantee. "To have a property interest in a benefit [such as a job] a person clearly must have more than an abstract need or desire for it. He must have more than a unilateral expectation of it. He must, instead, have a legitimate claim of entitlement to it." Speckman, 540 N.E.2d at 1193 (quoting Roth, 408 U.S. at 577, 92 S. Ct. at 2709). Mere placement on a list of available hearing officers is far too attenuated from receipt of the actual benefit, case assignment, to constitute a property interest protected by the Due Process Clause.See footnote 13
employment without hearing or inquiry required by due process" also applied to a teacher recently hired without tenure or a formal contract, but nonetheless with a clearly implied promise of continued employment. Roth, 408 U.S. at 577, 92 S. Ct. at 2709 (citing Connell v. Higginbotham, 403 U.S. 207, 208, 91 S. Ct. 1772, 1773, 29 L. Ed. 2d 418 (1971). In Perry v. Sindermann, the Court held that a college professor who relied on rules and understandings regarding tenure and the renewal of contracts was entitled to due process regarding his nonretention as a professor. 408 U.S. 593, 92 S. Ct. 2694, 33 L. Ed. 2d 570 (1972).
("There is . . . no indication in Illinois law that possession of a certificate from the Board of Examiners means anything more than that one is to be placed on the eligibility list and considered at the appropriate time by the Board of Education. Claims of entitlement to promotion sufficient to evoke constitutional protection must be based on surer footing.").
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