Opinion
Civil Action No. 17270-NC.
Submitted: March 13, 2000.
Decided: March 17, 2000.
Neil R. Lapinski, P.O. Box 1429, Wilmington, DE 19899.
Ellen Marie Cooper, Morris, James, Hitchens Williams, P.O. Box 2306, Wilmington, DE 19899-2306.
Counsel:
Plaintiff William Theis, a school principal, brings this action seeking equitable relief in the form of specific performance and a mandatory injunction against defendant Board of Education of the Brandywine School District.
Theis complains that the District breached his employment contract by: (1) unilaterally modifying the salary provision in the employment contract; and, (2) unilaterally modifying the salary provision without additional consideration. The District's alleged breach caused Theis' past and prospective annual salaries to be reduced thereby adversely lowering the contributions the District made and will make to Theis' State administered retirement fund.
The District moves to dismiss for lack of subject matter jurisdiction arguing that Theis has an adequate remedy at law.
The Court of Chancery can not exercise its equity jurisdiction where a complainant has an adequate legal remedy in the form of an action for money damages or a petition for a writ of mandamus. I, therefore, grant the motion to dismiss.
I. BACKGROUND
Plaintiff William Theis is employed by the Board of Education for the Brandywine School District as Principal of Talley Middle School in Wilmington, Delaware. The District is an administrative agency of the State of Delaware.
Joseph P. DeJohn, Ed.D., is the Superintendent of the Brandywine School District.
Theis agreed to the District's School Administrators Contract effective July 1, 1995. The employment contract includes provisions regarding salary composition and contract modifications. The salary provision contains an Administrative Salary Schedule that determines the salaries and yearly salary increases of all administrators employed by the Board of Education. The contract provides for changes in salary and benefit by addendum "signed by both" parties.
The provision regarding modification states in relevant part "[t]his Agreement may be modified annually or as required with respect to [Salary] and [Benefits] by written addendum signed by both parties and attached to the original executed counterpart." School Administrators Contract ¶ 10.
On July 15, 1996, the Board of Education eliminated the Administrative Salary Schedule referred to in all administrators' contracts and placed the determination of administrative salaries solely within DeJohn's authority for the 1996-97 school year. The net effect of the new procedure reduced Theis' annual salary for fiscal years 1995-96, 1996-97, and 1998-99.
On July 21, 1996, Theis first recognized the salary adjustment in his paycheck. In later fiscal years, Theis would receive a letter from DeJohn stating his salary for the forthcoming school year. Under the former Administrative Salary Schedule, Theis was to receive a salary of $71,915.35 during the 1996-97 fiscal year, $81,239.60 during the 1997-98 fiscal year, and $83,677.40 during the 1998-99 fiscal year. The new procedure for determining salaries reduced those amounts to $63,047, $67,761, and $75,581 respectively.
On July 1, 1999, Theis brought this action in the Court of Chancery against the District for breach of his employment contract. He requests monetary damages for the 1995-96 through 1998-99 fiscal years and specific performance of the salary provision through the 1999-2000 fiscal year. After the District filed a memorandum in support of a motion to dismiss for lack of subject matter jurisdiction, Theis amended, with leave of Court, the original complaint. On February 25, 2000, he requested additional equitable relief in the form of a permanent injunction mandating that the District make supplemental contributions to the State Employees' Retirement Fund and communicate to the Board of Pension Trustees those amounts in order to fund appropriately his pension plan. The State plan is, of course, administered according to statute.
II. CONTENTIONS
Theis contends that the District breached its contractual obligation because it: (1) unilaterally modified the salary provision in the employment contract without his signed consent; and, (2) unilaterally modified the salary provision without additional consideration. The breach resulted in lower past, present and future salary payments and corresponding reductions in pension contributions. Theis seeks monetary damages, specific performance of the salary provision contained in the employment contract, and permanent mandatory injunctive relief directing the District to make appropriate pension contributions to the State plan.
The District now renews its motion to dismiss. The District continues to assert that the Court of Chancery lacks subject matter jurisdiction because as to each of Theis' claims for relief, he has an adequate remedy at law.
III. LEGAL STANDARD
This Court can not exercise its equity jurisdiction on any claim where an adequate remedy at law is available. An adequate remedy at law must be as complete, practical, and efficient to the ends of justice and to its prompt administration as the equitable remedy. In order to divest this Court of its equity jurisdiction, the legal remedy must afford plaintiff "full, fair and complete relief."
10 Del. C. § 342.
International Business Machines Corp. v. Comdisco , Del. Ch., 320 A.2d 74, 78 (1991); Elster v. American Airlines , Del. Ch., 100 A.2d 219 (1953).
Hughes Tool Co. v. Fawcett Publications, Inc ., Del. Supr., 315 A.2d 577, 579 (1974).
A request for equitable relief fashioned by "the artful use [or] the wholesale invocation of familiar chancery terms" will not automatically confer jurisdiction in this Court. If the legal remedy is available and fully adequate, this Court will not accept jurisdiction.
McMahon v. New Castle Assocs ., Del. Ch., 532 A.2d 601, 603 (1987).
Id.
IV. ANALYSIS
A. Specific PerformanceI first turn to Theis' claim for breach of the salary provision in his employment contract. He seeks equitable relief in the form of an order to the District requiring that it pay him according to the original salary provision before unilateral modification through the 1999-2000 fiscal year.
Theis claims that the District unilaterally modified the salary provision which reduced his yearly salary, which in turn significantly affected the amount of money deposited into his Retirement Fund, thereby reducing his ultimate pension benefit. Theis argues that the District modified the contract in violation of the contract provision which required both parties' consent
Theis seeks both monetary damages for past inappropriately reduced salary payments and an order directing the District to specifically perform its contractual obligations by paying salary benefits consistently with his interpretation of the employment contract. Where parties seek money damages for prior wrongful conduct coupled with a request to prevent such wrongful conduct in the future, the latter does not confer equitable jurisdiction. If in fact Theis states a claim for breach of the contract for the fiscal years 1995-96 through 1998-99, there is no reason why the alleged future breach cannot be remedied by the award of monetary damages. In fact, what Theis asserts to be an equitable claim for specific performance is nothing more than a claim of anticipatory breach of his employment contract. I find that plaintiff's claim for equitable relief in the form of specific performance is merely a disguised claim for damages for breach and anticipatory breach of his employment contract As Chancellor Allen stated in McMahon :
International Business Machines , supra.
Chancery jurisdiction is not conferred by the incantation of magic words. Neither the artful use nor the wholesale invocation of familiar chancery terms in a complaint will itself excuse the court, upon a proper motion, from a realistic assessment of the nature of the wrong alleged and the remedy available in order to determine whether a legal remedy is available and fully adequate.
The wrong alleged here is past breach of contract and anticipated breach of contract. The remedy available is an award of money damages for the difference between the amount the District should have paid or should pay and what they did pay and would be anticipated to pay, without a judgment in Theis' favor. Because plaintiff can adequately seek monetary damages in a court of law for his breach of contract claims, this Court does not have jurisdiction to hear and decide this matter.
B. Injunctive Relief
Plaintiff amended his complaint seeking additional equitable relief in the form of a permanent injunction mandating that the District make supplemental contributions to Theis' retirement fund and forward those amounts to the Board of Pension Trustees.
The threshold issue is whether this Court has jurisdiction over plaintiff's request for injunctive relief. It is unquestionable that an injunction constitutes equitable relief. Where the party seeking relief can obtain the relief requested at law, equity will not exercise jurisdiction. Theis may obtain the relief he requests in the law court in the form of a writ of mandamus.
DONALD J. WOLFE, JR. MICHAEL A. PITTENGER, CORPORATE AND COMMERCIAL PRACTICE IN THE DELAWARE COURT OF CHANCERY § 2-3(b) (1998 Supp. 2000); see also Clark v. Teeven Holding Co ., Del. Ch., 625 A.2d 869 (1992).
McMahon , supra at 603.
Theis' amended complaint requests a mandatory injunction, the terms of which would order the District to make supplemental contributions to his retirement fund in accordance with the statute. While his inartful invocation of equity terminology attempts to invoke the jurisdiction of the Court of Chancery, what Theis really requests is relief that should come in the form of a writ of mandamus, ordering a state agency to do what it must pursuant to statute, an action exclusively within the jurisdiction of the Superior Court. The determination of amount and method of payment of the pension contributions Theis seeks is clearly governed by statute. It is apparent from the applicable statutes that should Theis prevail on his breach of contract claim, the District would be required to adjust accordingly his pension contribution.
10 Del. C. § 564 and 29 Del. C. § 10143.
See Title 29, Chapter 55 of the Delaware Code titled "State Employees' Pension Plan." Specifically, 29 Del. C. § 5543 5547 highlight employee and employer pension plan contributions.
A full and adequate legal remedy is available. The mandatory injunctive relief plaintiff seeks is available through a writ of mandamus.
V. CONCLUSION
This Court lacks subject matter jurisdiction to hear and decide Theis' breach of contract and ancillary claims. The District's motion to dismiss is granted .
IT IS SO ORDERED.