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Release doesn't cover "willful and wanton" misconduct
by Gerard Panaro, BOL Guru

A release is invalid as to willful and wanton misconduct, the Court of Appeals of Ohio, Tenth District, held in Peitsmeyer v. Jackson Tp. Bd. of Trustees, 2003 WL 21940713 (Ohio App. 10 Dist., 2003). Future liability exists if the alleged conduct involves intentional, reckless, willful or wanton misconduct.

The plaintiff was an assistant fire chief. As a result of an employment dispute, he entered into a settlement agreement and release ("release") with the township, under which he received approximately $70,000. He agreed to resign and to release all claims against the town. At the time of signing, he was told that he would have time to gather his office belongings but while he was packing them, his wife called and he left on a personal emergency. While at home, his belongings were delivered to his house. When he went back to the fire station, he discovered that someone had gone into his locked office and unlocked his desk drawer and locker, and discarded some of his personal belongings, including sensitive personal documents dealing with his son's legal problems. Some things were thrown away. He was forced to sort through his personal items in front of other firefighters on a folding table and had to retrieve a trash bag containing personal items from a trash container. Further, various Vietnam War mementos were thrown away which he was unable to find. Three years later, the plaintiff sued the township for retaliation, invasion of privacy, violation of public policy, intentional infliction of emotional distress, bad faith breach of contract and conversion. In the meantime, he had kept the $70,000. The town defended on the basis of the release.

The court of appeals stated the legal principles governing releases as follows: Generally, a release of a cause of action is an absolute bar to a later action on any claim "encompassed" within the release. Where a party has taken and kept the benefits of an agreement of compromise and settlement, s/he will not be allowed to assert any claim that was released by the agreement. A release is a contract and, as such, the overriding consideration in interpreting a release is to ascertain the intent of the parties, which intent is presumed to reside in the language the parties chose to employ in the agreement. A court will not resort to extrinsic evidence unless the language is unclear or ambiguous.

Ohio law is equally clear, however, the court went on, that a release is invalid as to "willful and wanton misconduct." In this case, the court went on, there was no need to address the question of the parties' intent because the release at issue did not bar the plaintiff's claims, because he alleged willful and intentional misconduct on the part of the township. (Ironically, despite the plaintiff's success on his challenge to the release, the court ruled in favor of the township on each of his individual claims and the court of appeals affirmed.)

First published October 2003 in Fair Employment Practices Guidelines, a semimonthly publication by Aspen Publishers, 1185 Avenue of the Americas. New York, NY.

About the Author:
Gerard P. Panaro has more than 25 years' experience in employment law and is available to assist readers on an individual basis. You may reach him at 202-861-1314. Mr. Panaro is of counsel with Howe & Hutton, in the Washington, DC office.

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