Dan Hampton v. Macon County Board of Education

IN THE COURT OF APPEALS OF TENNESSEE

AT NASHVILLE

November 19, 2013 Session

DAN HAMPTON v. MACON COUNTY BOARD OF EDUCATION

Direct Appeal from the Circuit Court for Macon County

No. 2012-cv-81 John D. Wooten, Judge

No. M2013-00864-COA-R3-CV - Filed January 10, 2014

A school administrator filed the instant lawsuit, alleging that his employment was terminated

in violation of both the Open Meetings Act and his contract of employment. The trial court

granted summary judgment to the defendant school board on the Open Meetings Act claims

on the basis of laches, finding that the school administrator failed to bring his claim in a

timely manner. The trial court also granted summary judgment as to the contract claim,

finding that the school administrator could not prove damages. We reverse the trial court’s

ruling with regard to the school administrator’s claims for declaratory and injunctive relief

pursuant to the Open Meetings Act, but affirm as to the remainder of the trial court’s

decision. Reversed in part, affirmed in part, and remanded.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed in

part; Reversed in part; and Remanded

J. S TEVEN S TAFFORD, J., delivered the opinion of the Court, in which A LAN E. H IGHERS, P.J.,

W.S., and D AVID R. F ARMER, J., joined.

Fletcher W. Long and John E. Herbison, Clarksville, Tennessee, for the appellant, Dan

Hampton.

Kenneth S. Williams, Cookeville, Tennessee, for the appellee, Macon County Board of

Education.

OPINION

I. Background

Plaintiff/Appellant Dan C. Hampton, who has worked in education since 1973, was

employed by the Defendant/Appellee Macon County Board of Education (“the School

Board”) as Director of Schools. According to Mr. Hampton’s contract with the School Board,

executed on August 24, 2009, Mr. Hampton was employed for a fixed term from September

1, 2009 to June 30, 2011. Part of Mr. Hampton’s job was to prepare the agenda for the

School Board meetings, which are held on the second Thursday of every month.

On November 17, 2010, Mr. Hampton was informed by the Chairman of the School

Board that a specially called meeting of the School Board was to be held on Friday,

November 19, 2010. When asked, the Chairman allegedly refused to divulge the purpose of

the meeting. The November 19 meeting occurred, with no written agenda, despite the fact

that the preparation of a written agenda was the usual practice at the meetings. At the

meeting, Mr. Hampton’s employment was terminated by a vote of 4 to 1. According to the

School Board’s brief, the School Board voted to pay the remainder of Mr. Hampton’s salary

and benefits over the term of his employment contract, ending in June 2011. It is undisputed

that Mr. Hampton received all salary and benefits under his contract of employment,

notwithstanding the termination of his employment. According to Mr. Hampton, during his

tenure with the School Board, he was never accused of criminal or professional misconduct.

Also according to Mr. Hampton, the School Board gave no indication concerning the reason

for the termination of his employment. The School Board then voted to rehire the School

Board’s prior Director of Schools, as the Interim Director, without publicly posting the

vacancy in accordance with their usual custom.

According to Mr. Hampton’s brief, after his employment was terminated, he diligently

searched for replacement employment, but the fact that he was fired operated as a blemish

on his record that prevented him from obtaining suitable full-time replacement employment.

According to Mr. Hampton, he never had difficulty obtaining employment prior to his

termination. Mr. Hampton’s only work subsequent to his termination was that of a part-time

consultant.

On January 24, 2012, Mr. Hampton filed a Complaint for a Declaratory Judgment,

Injunctive Relief, and Damages, asserting that the Open Meetings Act had been violated, and

that the School Board had breached Mr. Hampton’s contract of employment. Specifically,

the Complaint asked:

d) That the Court declare the actions of the [School Board] in its

special [sic] called meeting of November 19, 2010 to be void

and of no effect under Tenn[essee] Code Ann[otated] § 8-44-

105.

e) That the Court order the [School Board] to reinstate Plaintiff

in his employment as Director of Schools;

f) That the Court permanently enjoin members of the [School

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Board];

g) That he be awarded compensatory damages in an amount

appropriate according to the proof in this cause;

h) That the costs of this action, including discretionary costs, be

assessed against [the School Board]:

i) That he have further or general relief as may be appropriate

under the facts and circumstances of this case.

On October 25, 2012, the School Board filed an answer, denying that Mr. Hampton

was entitled to relief and specifically raising the defense of laches. Thereafter, on December

6, 2012, the School Board filed a motion for summary judgment, along with a statement of

undisputed facts, affidavits, and exhibits. With regard to the Open Meetings Act claims, the

School Board asserted that Mr. Hampton’s action was barred by the doctrine of laches due

to his delay in filing. The School Board further argued that there was no breach of contract

because Mr. Hampton had been paid the full amount to which he was entitled under his

employment contract. Finally, the School Board argued that as to any defamation or damage

to reputation claims that may be fairly read from the Complaint, those actions sounded in tort

and were barred by the applicable statute of limitations. Mr. Hampton filed a response on

February 19, 2013. With regard to the laches argument, Mr. Hampton asserted that he

delayed filing his case because he believed that pending litigation would prevent him from

obtaining replacement employment. In addition, Mr. Hampton stated that had he been able

to obtain appropriate employment, he would not have felt the need to file his Complaint;

however, because he was unable to obtain replacement employment, he filed his Complaint

for damages and, essentially, to clear his name. After arguments of counsel, the trial court

entered an order granting summary judgment to the School Board on March 7, 2013.

Specifically, the trial court stated:

1. With regard to [Mr. Hampton’s] claims of damage to

reputation and for compensatory damages as set out in the

Complaint[,] the Court finds that these claims sound in tort, and

are barred by the provisions of the Governmental Tort Liability

Act[,] as well as the statute of limitations applicable to damage

to reputation claims.

2. Concerning [Mr. Hampton’s] contract claim[], the Court

finds that [Mr. Hampton] received all the benefits to which he

was entitled, and so has failed to establish the existence of any

damages which are an essential element of his contractual

claims.

3. As to [Mr. Hampton’s] Open Meetings Act violation claims,

the Court further finds that [Mr. Hampton] accepted his

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contractual payments and waited quietly and without excuse,

from the date of his termination until after his contract expired,

without filing suit seeking to void any actions taken by the

School Board in violation of the Open Meetings Act. The Court

finds that laches applies under these facts, and that the plaintiff

is equitably estopped from asserting violations of the Open

Meetings Act.

Based on the foregoing, the Court finds the [School

Board’s] motion to be well taken and summary judgment is

hereby granted in favor of the [School Board] as to all theories

and claims, with costs to the [School Board] for which

execution may issue. This is a final order.

From this order, Mr. Hampton now appeals.

II. Issues Presented

Mr. Hampton raises one issue for review, which is taken from his brief:

1. Whether the trial court erroneously granted summary

judgment to the Appellee where uncontested facts

showed a violation of the Open Meetings Law by the

Appellee Board of Education, in contravention of Mr.

Hampton’s contract of employment and that the Mr.

Hampton has sustained damages resulting from such

breach

However, as we perceive it, there are two issues in this case:

1. Whether the trial court erred in granting summary judgment on Mr. Hampton’s claims

under the Open Meetings Act?

2. Whether the trial court erred in granting summary judgment on Mr. Hampton’s

contract claim?

We conclude that the trial court erred in dismissing Mr. Hampton’s claims for declaratory

and injunctive relief under the Open Meetings Act on the basis of laches. However, we

affirm summary judgment as to Mr. Hampton’s request to be reinstated/returned to duty, as

well as to Mr. Hampton’s contract claim.

II. Standard of Review

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A trial court’s decision to grant a motion for summary judgment presents a question

of law. Our review is therefore de novo with no presumption of correctness afforded to the

trial court’s determination. Bain v. Wells, 936 S.W.2d 618, 622 (Tenn. 1997). This Court

must make a fresh determination that the requirements of Tenn. R. Civ. P. 56 have been

satisfied. Abshure v. Methodist Healthcare-Memphis Hosps., 325 S.W.3d 98, 103 (Tenn.

2010).

When a motion for summary judgment is made, the moving party has the burden of

showing that “there is no genuine issue as to any material fact and the moving party is

entitled to judgment as a matter of law.” Tenn. R. Civ. P. 56.04. According to the Tennessee

Legislature:

In motions for summary judgment in any civil action in

Tennessee, the moving party who does not bear the burden of

proof at trial shall prevail on its motion for summary judgment

if it:

(1) Submits affirmative evidence that negates an essential

element of the nonmoving party's claim; or

(2) Demonstrates to the court that the nonmoving party's

evidence is insufficient to establish an essential element of the

nonmoving party's claim.

Tenn. Code Ann. § 20-16-101 (effective on claims filed after July 1, 2011).

IV. Analysis

Open Meetings Act Claims

We begin first with Mr. Hampton’s claims based on alleged violations of the Open

Meetings Act. The Open Meetings Act, Tennessee Code Annotated Section 8-44-101, et.

seq., requires that meetings of any governing body are to be “open to the public at all times,

except as provided by the Constitution of Tennessee.” Tenn. Code Ann. § 8-44-102(a).

Actions taken in violation of the Open Meetings Act are void ab initio: “Any action taken

at a meeting in violation of this part shall be void and of no effect; provided, that this

nullification of actions taken at such meetings shall not apply to any commitment, otherwise

legal, affecting the public debt of the entity concerned.” Tenn. Code Ann. § 8-44-105. Mr.

Hampton argues that the School Board violated the Open Meetings Act when it terminated

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his employment because the School Board’s action in so doing was “unlawfully

predetermined . . . prior to the November 19, 2010 meeting and was merely ratified at that

meeting as a fait accompli.”

For purposes of this appeal, the School Board does not deny that their meetings are

subject to the Open Meetings Act. Instead, the School Board argues that Mr. Hampton’s

claims pursuant to the Open Meetings Act are barred by the doctrine of laches. This Court

recently explained the doctrine of laches as an affirmative defense to a claim:

“Unreasonable delay in pursuing rights calls the equitable

doctrine of laches into play to prevent assertion of stale claims.”

Tennessee Pine Co. v. Via, No. W1999-00558-COA-R3-CV,

2000 WL 34411147, at *5 (Tenn. Ct. App. Aug. 25, 2000)

(citing Nunley v. Nunley, 925 S.W.2d 538, 542 (Tenn. Ct.

App.1996)). However, delay, by itself, is not sufficient to invoke

the doctrine of laches. Id. The determinative test “is not the

length of time that has elapsed, but whether, because of such

lapse of time, the party relying on laches as a defense has been

prejudiced by the delay.” Id. (quoting Nunley, 925 S.W.2d at

542). “Generally, the doctrine of laches applies to actions not

governed by a statute of limitations.” 1 Briceno v. Briceno, No.

M2006-01927-COA-R3-CV, 2007 WL 4146280, at *4 (Tenn.

Ct. App. Nov. 21, 2007) (citing Gleason v. Gleason, 164

S.W.3d 588, 592 (Tenn. Ct. App. 2004); Dennis Joslin Co. v.

Johnson, 138 S.W.3d 197, 201 (Tenn. Ct. App. 2003)). Where

the action is governed by a statute of limitations, the doctrine of

laches may shorten that time period if the plaintiff is guilty of

gross laches by unreasonably acquiescing in adverse rights for

a long duration of time, causing “prejudice to the defendant such

as the loss of evidence and witnesses or a considerable

accumulation of interest resulting from the unjustified delay of

the plaintiff.” Id. (citations omitted). “It is an equitable defense

which requires the finder of fact to determine whether it would

be inequitable or unjust to enforce the claimant's rights.” Estate

of Baker v. King, 207 S.W.3d at 264.

Grand Valley Lakes Property Owners Ass'n, Inc. v. Burrow, 376 S.W.3d 66, 83–84 (Tenn.

1

It is undisputed that the Open Meetings Act contains no express statute of limitations. See Tenn.

Code Ann. § 8-44-101, et. seq.

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Ct. App. 2011).

The trial court’s decision to dismiss a claim on the basis of laches is reviewed under

the abuse of discretion standard:

A trial court's decision regarding whether to apply the doctrine

of laches will not be reversed absent an abuse of discretion. Id.

at *3; Estate of Baker, 207 S.W.3d at 264; Griffin v. Lester,

No. W2004-02072-COA-R3-CV, 2005 WL 3199279, at *5

(Tenn. Ct. App. Nov. 30, 2005); Tennessee Pine Co., 2000 WL

34411147 at *6. Under the abuse of discretion standard, the trial

court's decision “will be upheld so long as reasonable minds can

disagree as to the propriety of the decision made.” Camp v.

Camp, No. W2010-01037-COA-R3-CV, 2011 WL 2567542, at

*5 (Tenn. Ct. App. June 29, 2011) (quoting Eldridge v.

Eldridge, 42 S.W.3d 82, 85 (Tenn. 2001)). The abuse of

discretion standard involves “a less rigorous review of the lower

court's decision and a decreased likelihood that the decision will

be reversed on appeal.” Lee Medical, Inc. v. Beecher, 312

S.W.3d 515, 524 (Tenn. 2010) (citing Beard v. Bd. of Prof'l

Responsibility, 288 S.W.3d 838, 860 (Tenn. 2009)). The

standard “reflects an awareness that the decision being reviewed

involved a choice among several acceptable alternatives.” Lee

Medical, Inc., 312 S.W.3d at 524 (citing Overstreet v. Shoney's,

Inc., 4 S.W.3d 694, 708 (Tenn. Ct. App. 1999)). Accordingly,

appellate courts are not permitted to “second guess” the trial

court's determinations or to substitute their judgment for that of

the trial court. Lee Medical, Inc., 312 S.W.3d at 524 (citing

White v. Vanderbilt Univ., 21 S.W.3d 215, 223 (Tenn. Ct. App.

1999)). “The abuse of discretion standard of review does not,

however, immunize a lower court's decision from any

meaningful appellate scrutiny.” Lee Medical, Inc., 312 S.W.3d

at 524 (citing Boyd v. Comdata Network, Inc., 88 S.W.3d 203,

211 (Tenn. Ct. App. 2002)).

Grand Valley, 376 S.W.3d at 84.

Thus, in order for laches to apply, the School Board must show not only that Mr.

Hampton unreasonably delayed the filing of the action, but that the delay in filing caused

prejudice to the party asserting the laches defense. See Dennis Joslin Co., LLC v. Johnson,

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138 S.W.3d 197, 200 (Tenn. Ct. App. 2003) (“[The doctrine of laches] requires an

unreasonable delay that prejudices the party seeking to employ laches as a defense, and it

depends on the facts and circumstances of each individual case.”). We turn to consider these

two elements, delay and prejudice, as applied to the undisputed facts of this case.

Here, the trial court clearly determined that Mr. Hampton’s action in waiting nearly

nineteen months from his termination and seven months from the expiration of his contract

constituted an unreasonable and inexcusable delay. We find no abuse of discretion in the trial

court’s determination that Mr. Hampton’s delay was unreasonable. Mr. Hampton asserts that

he delayed bringing his suit in order to pursue replacement employment. However, we cannot

conclude that the trial court abused its discretion in concluding that Mr. Hampton’s

apparently unsuccessful attempt to obtain replacement employment justifies his delay.

Indeed, Mr. Hampton was fully aware of any wrong that may have been committed on

November 19, 2010. The voluntary decision to delay filing this lawsuit for strategic purposes

is simply insufficient to show that the trial court abused its discretion in finding that the delay

was unjustified.

The trial court, however, made no findings or conclusions at to whether the School

Board was prejudiced by the delay, an essential element of the defense of laches. As

discussed above, the decision to apply the doctrine of laches is reviewed under the abuse of

discretion standard. See Grand Valley, 376 S.W.3d at 84. However, when the trial court fails

to make findings of fact or conclusions of law to support its decisions, we must

independently review the record to determine whether the appropriate elements have been

met. See Williams v. Singler, No. W2012-01253-COA-R3-JV, 2013 WL 3927934, at *10

(Tenn. Ct. App. July 31, 2013) (declining to apply the abuse of discretion standard in a

parenting plan case when the trial court failed to make sufficient findings of fact to support

its decision). Accordingly, we will review the record to determine whether the undisputed

facts support a finding that the School Board was prejudiced by Mr. Hampton’s delay.

At the outset, in order to determine whether the School Board was prejudiced by Mr.

Hampton’s delay, we must first determine what claims Mr. Hampton asserts with regard to

his allegation that the School Board violated the Open Meetings Act. The Complaint in this

case is not a model of clarity, and consequently, there was considerable dissension in the trial

court as to the claims asserted by the Mr. Hampton. From our reading of the Complaint, we

conclude that Mr. Hampton seeks three forms of relief from the alleged Open Meetings Act

claim: (1) A request for a Declaratory Judgment that the termination was in violation of the

Open Meetings Act, and that, therefore, the termination was void ab initio; (2) Reinstatement

of his employment, which we will refer to as “return to duty;” and (3) A request for an

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injunction preventing the School Board from engaging in such behavior in the future.2

With regard to the “return to duty” claim, we agree with the School Board that Mr.

Hampton’s failure to file his claim until after his contract for employment had expired caused

prejudice to the School Board. As previously discussed, Mr. Hampton’s contract expired on

June 30, 2011. However, Mr. Hampton did not file this suit until January 24, 2012, nearly

seven months later. As of June 30, 2011, however, regardless of whether Mr. Hampton’s

employment was properly or improperly terminated, Mr. Hampton had no right to “return to

duty.” If this Court were to return Mr. Hampton to duty now, after the natural expiration of

his contract, this Court would be rewriting Mr. Hampton’s contract of employment. That is

simply something this Court cannot do. See Bernier v. Morrow, No. M2012-01984-COA-

R3-CV, 2013 WL 1804072 (Tenn. Ct. App. April 26, 2013) (“[T]his Court simply cannot

rewrite the parties’ contract.”). In addition, during the period of Mr. Hampton’s contract after

his termination, the School Board paid for an Interim Director to fill Mr. Hampton’s position

for the remainder of his contract. The School Board also undisputedly continued to pay the

balance on Mr. Hampton’s contract for employment. If Mr. Hampton had promptly brought

his suit and had successfully obtained reinstatement for the duration of his contract, the

School Board would not have been required to pay both salaries. See 30A C.J.S. Equity §

147 (2013) (noting that one form of prejudice occurs when “money or valuable services will

be wasted as a result of the delay”). Under these circumstances, we conclude that the School

Board would be prejudiced in having to defend against the reinstatement of an employee who

has no right to be reinstated beyond the original contract terms. Accordingly, we affirm the

dismissal of this claim on the basis of laches.

The School Board, however, has submitted no evidence that it would be prejudiced

in having to defend against Mr. Hampton’s remaining Open Meetings Act claims. Indeed,

2

From our review of Mr. Hampton’s Complaint, his request for monetary damages is based on the

allegation that the School Board breached the duty of good faith implied in Mr. Hampton’s employment

contract, discussed infra. However, to the extent that Mr. Hampton’s Complaint may be read to seek damages

solely as a result of alleged violation of the Open Meetings Act, we conclude that such request is

inappropriate. The appropriate remedies for violations of the Open Meetings Act are defined by Tennessee

Code Annotated Sections 8-44-105 and 8-44-106. First, Section 8-44-105 directs a court to declare void any

action taken in violation of the Open Meetings Act. Tenn. Code Ann. § 8-44-105. Second, Section 8-44-106

allows the court to “issue injunctions, impose penalties, and otherwise enforce the purposes of this part.”

Tenn. Code Ann. § 8-44-106(a). The Tennessee Supreme Court, in considering the constitutionality of the

previous version of the Open Meetings Act, held that the ability of courts to “impose penalties” for violations

of the Open Meetings Act “is limited to citation for contempt for violation of an injunction issued after a

finding of failure to comply with the requirements of the Act.” Dorrier v. Dark, 537 S.W.2d 888, 892 (Tenn.

1976). There is no allegation that the School Board violated an injunction already in place in this case.

Accordingly, the court is not at liberty to impose any monetary penalties solely as a result of the alleged

violation of the Open Meetings Act.

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the School Board, in its brief to this Court, does not appear to assert any alleged prejudice

or harm that would occur by allowing Mr. Hampton to proceed on his claims for declaratory

and injunctive relief. This Court has previously held that in order for laches to apply, there

must be some showing of actual prejudice by the party asserting the defense of laches. For

example, in Keith v. Regas Real Estate Co., No. E2011-00337-COA-R3-CV, 2011 WL

6009625 (Tenn. Ct. App. Dec. 2, 2011), this Court noted that in usual cases of laches, the

trial court finds prejudice through the loss of evidence, the death of witnesses, or the loss of

memory caused by the delay. Id. at *6 (citing Brown v. Ogle, 46 S.W.3d 721, 726 (Tenn. Ct.

App. 2000)). However, because the party asserting the defense of laches in Keith “ha[d] not

provided any [such] examples of actual prejudice that would occur if the suit were to

proceed,” the Court concluded that the trial court erred in dismissing the case on the basis

of laches. Keith, 2011 WL 6009625, at *6. Thus, a party asserting the defense of laches must

submit some evidence that it was prejudiced by the delay in filing suit:

Prejudice is an essential element of the assertion of

laches. "Legal prejudice" results when there is a loss or injury to

a person who relies on another person's voluntary failure to

exercise a legal right. The mere passage of time will not give

rise to an inference of prejudice, for the purposes of establishing

that element of a laches claim. Accordingly, in addition to delay

by a person asserting a legal right, laches requires a resultant

injury or prejudice by reason of the delay, or a change in the

condition of the property or relations of the parties rendering it

inequitable to enforce the legal right.

However, not every change in conditions will constitute

prejudice within the doctrine of laches, and whether an injury

cognizable under the doctrine of laches occurs depends on

assessing the inherent equities of the particular case. Laches is

usually involved in situations where the delay in prosecuting the

claim has made the claim harder to defend against, or where

money or valuable services will be wasted as a result of the

delay. Prejudice, supportive of laches, may thus be demonstrated

by a showing of injury, change of position, loss of evidence,

unavailability of witnesses, or some other disadvantage resulting

from delay, which diminish a defendant's chances of success.

Plaintiff is only held accountable for that degree or

amount of prejudice which flows from, and was accrued during,

plaintiff's period of unreasonable and [i]nexcusable delay and

plaintiff is not held responsible for prejudice which cannot be

directly traced to plaintiff's own dilatory actions.

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Thus, in the context of a defense based on laches, delay

is not a bar unless it works to the disadvantage or prejudice of

other parties. Where no one has been harmed in any legal sense

and the situation has not materially changed, the delay is not

fatal. Thus, even where impermissible delay is present under the

circumstances presented, if the delay has not prejudiced the

party asserting the laches defense, it will not bar the equitable

action. Furthermore, a party cannot assert the defense of laches

if he or she actually benefitted from the delay.

Prejudicial harm does not occur merely because one loses

what he or she otherwise would have kept. There must be a

delay which causes a disadvantage in asserting and establishing

a claimed right or defense, or other damage caused by

detrimental reliance.

Prejudice is not presumed, but rather must be

affirmatively demonstrated. The party asserting the defense of

laches must present evidence demonstrating prejudice from the

lapse of time that he or she claims has resulted from the

opposing party's failure, due to want of diligence, to promptly

institute an action.

30A C.J.S. Equity § 147 (2013) (footnotes omitted).

In this case, we conclude that the School Board has failed to meet its burden to show

prejudice based on the undisputed facts of the case with regard to Mr. Hampton’s declaratory

and injunctive relief claims pursuant to the Open Meetings Act. Therefore, the School Board

is not entitled to summary judgment on the basis of laches for these claims. The School

Board has not shown that it will be unable to defend against the remaining claims, that it has

been disadvantaged in any way, or that money or valuable services have been wasted as result

of the delay in filing these particular claims. Without some showing of prejudice, the

application of the doctrine of laches is inappropriate. Consequently, we reverse the trial

court’s grant of summary judgment in favor of the School Board with regard to Mr.

Hampton’s claims for declaratory relief and injunctive relief pursuant to the Open Meetings

Act. Because summary judgment was inappropriate as to Mr. Hampton’s requests for a

declaratory judgment and an injunction pursuant to the Open Meetings Act, we remand to

the trial court for further proceedings on these two claims. We express no opinion as to the

question of whether Mr. Hampton is ultimately entitled to either declaratory or injunctive

relief upon remand.

Contract Claim

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We next consider whether the trial court erred in granting summary judgment to the

School Board with regard to Mr. Hampton’s breach of contract claim. The trial court granted

the School Board’s motion, finding that as Mr. Hampton had been paid the full amount of

salary and benefits under his contract, he was unable to prove damages, an essential element

of his contract claim. We agree.

There are two forms of employment in Tennessee—employment at-will and

contractual employment. According to the Tennessee Supreme Court:

[The employment at-will] doctrine applies in the absence

of a contract of employment, and it means that an employment

relationship generally can be terminated by either the employer

or the employee with or without cause. See Bennett v. Steiner-

Liff Iron and Metal Co., 826 S.W.2d 119, 121 (Tenn. 1992).

Therefore, in Tennessee, unless there is a contract of

employment for a definite term, a discharged employee may not

recover against an employer because there is no right to

continued employment. See Forrester v. Stockstill, 869 S.W.2d

328, 330 (Tenn. 1994).

In contrast, a definite term employment contract

ordinarily may not be terminated before the expiration of the

contract period, except for good cause or by mutual agreement.

Bennett, 826 S.W.2d at 121. When a contract of employment is

breached, the proper measure of damages is the salary that

would have been earned had the contract not been breached, less

any amount the employee earned or should have earned in the

exercise of reasonable diligence in some other employment

during the unexpired contract term. See State ex rel.

Chapdelaine v. Torrence, 532 S.W.2d 542, 550 (Tenn.1975);

Jeffers v. Stanley, 486 S.W.2d 737, 739 (Tenn. 1972); Akers v.

J.B. Sedberry, Inc., 39 Tenn. App. 633, 286 S.W.2d, 617, 622

(1955); Godson v. MacFadden, 162 Tenn. 528, 39 S.W.2d 287,

288 (1931).

Cantrell v. Knox County Bd. of Educ., 53 S.W.3d 659, 662 (Tenn. 2001).

The employment at issue in this case was based on a contract. Mr. Hampton alleges

that the School Board breached his contract when it terminated his employment in violation

of the Open Meetings Act, which he alleges is a violation of the duty of good faith implied

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in all contracts. See Dick Broadcasting Co., Inc. of Tennessee v. Oak Ridge FM, Inc., 395

S.W.3d 653, 660 (Tenn. 2013) (“It is well-established that “[i]n Tennessee, the common law

imposes a duty of good faith in the performance of contracts.”) (quoting Wallace v. Nat'l

Bank of Commerce, 938 S.W.2d 684, 686 (Tenn.1996)). Thus, Mr. Hampton’s claim is one

for breach of contract. “The essential elements of any breach of contract claim include (1)

the existence of an enforceable contract, (2) nonperformance amounting to a breach of the

contract, and (3) damages caused by the breach of the contract.” ARC LifeMed, Inc. v.

AMC-Tennessee, Inc., 183 S.W.3d 1, 26 (Tenn. Ct. App. 2005). To prevail on any breach

of contract claim, the plaintiff must prove all elements.

The School Board argues, and the trial court found, that Mr. Hampton was unable to

prove the he suffered any damages as a result of any alleged breach of the employment

contract. As previously discussed, the measure of damage in a breach of employment contract

context is “the salary that would have been earned had the contract not been breached, less

any amount the employee earned or should have earned in the exercise of reasonable

diligence in some other employment during the unexpired contract term.” See Cantrell, 53

S.W.3d at 662. The contract at issue provided that Mr. Hampton would be paid his salary and

benefits through June 30, 2011. Accordingly, his damages for any alleged breach of that

contract would be his full salary and benefits through June 30, 2011. See id. In this case,

however, it is undisputed that Mr. Hampton was paid the full amount of his salary and

benefits for the duration of his contract, notwithstanding the termination of his employment.

Accordingly, Mr. Hampton can prove no damages as a result of the alleged breach of his

employment contract.

Mr. Hampton argues, however, that he has suffered damages other than just the loss

of salary due to his allegedly wrongful termination, including harm to his reputation. Mr.

Hampton fails to cite any authority for his assertion that he can claim loss of reputation as

a result of an alleged breach of contract. From our research it appears that such damages are

usually not favored. See 22 Am. Jur. 2d Damages § 61 (“A plaintiff cannot recover for

damage to its reputation arising out of an alleged breach of contract.”); 30 C.J.S.

Employer–Employee § 130 (“In an action for wrongful discharge in breach of contract,

damages are not recoverable for noneconomic loss. Such losses include injury to reputation,

goodwill, or health, or for physical pain and suffering, or mental or emotional distress or

suffering.”) (footnotes omitted); 24 Williston on Contracts § 66:4 (4th ed. 2013) (“[T]he

courts are in agreement that consequential damages for harm to reputation are not

recoverable [in a breach of contract action], because they are altogether nonquantifiable and

speculative.” but see 96 A.L.R.3d 437, § 2 (noting that special damages for harm to

reputation are sometimes allowed in contracts involving those in the literary, artistic, or

entertainment fields); 24 Williston on Contracts § 66:4 (providing that a wrongfully

discharged professional employee “may recover consequential damages for the loss of

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‘identifiable professional opportunities;’” however, noting that the employee must “allege[]

and prove[] with specificity that the defendant's breach actually adversely influenced or

affected future job opportunities”).

Regardless of whether damage to reputation is properly recoverable in a breach of

contract action, we conclude that Mr. Hampton is not entitled to such damages because he

failed to seek them in the trial court. From our review of Mr. Hampton’s Complaint, Mr.

Hampton sought only compensatory and general damages from the alleged breach of

contract; Mr. Hampton’s Complaint does not seek recovery of any consequential or special

damages. Rule 9.07 of the Tennessee Rules of Civil Procedure provides that: “When items

of special damage are claimed, they shall be specifically stated.” “The fundamental purpose

of the pleading requirement in [Rule] 9.07 is notice.” Keisling v. Keisling, 92 S.W.3d 374,

377 (Tenn. 2002); Castelli v. Lien, 910 S.W.2d 420, 429 (Tenn. Ct. App. 1995). According

to the Tennessee Practice Series:

Several significant procedural rules govern special and

general damages. General damages need not be identified with

particularity in the plaintiff's complaint, because they are the

proximate and necessary result of the breach, and a defendant

has notice of them as a matter of law of their existence. The law

does not imply special damages from a breach, however,

because they are not the necessary result of the defendant's

breach. Therefore, to prevent unfair surprise to the defendant at

trial, the plaintiff must specify these damages in the complaint,

or else risk not being able to give evidence upon them at trial.

22 Tenn. Prac. Contract Law and Practice § 12:10 (2013). Thus, special damages must be

specifically pleaded to prevent unfair surprise to the defendant.

This Court has previously treated “special damages” as synonymous with

“consequential damages” and has stated:

Consequential or “special” damages are defined in

Black’s [Law Dictionary] as “[s]uch damage as does not flow

directly and immediately from the act of the party, but only from

some of the consequences or results of such act.” The rule from

the venerable and familiar case of Hadley v. Baxendale, 9 Ex.

341, 156 Eng. Rep. 145 (1854) states that consequential

damages will only be awarded if they could reasonably be

supposed to have been within the contemplation of the parties at

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the time of contracting, as a probable consequence of a breach

of contract. The Baxendale rule has been seconded many times

by our Tennessee courts. See, for example, Lane v. Associated

Housing Developers, 767 S.W.2d 640 (Tenn. Ct. App. 1988);

Turner v. Benson, 672 S.W.2d 752 (Tenn. 1984).

Wills Electric Co., Inc., v. Mirsaidi, M2000-02477-COA-R3-CV, 2001 WL 1589119, at *4

(Tenn. Ct. App., Dec.13, 2001). Accordingly, both special and consequential damages are

subject to the requirements of Rule 9.07.

Tennessee courts have referred to harm caused by loss of reputation as a form of

consequential damages. See, e.g., Austin v. Sneed, No. M2006-00083-COA-R3-CV, 2007

WL 3375335, at *11 (Tenn. Ct. App. Nov. 13, 2007) (“[C]onsequential damages can include

damages for emotional distress and related personal injuries, injuries to reputation, [and]

economic losses.”); Sabaski v. Wilson County Bd. of Educ., No. M2010-00872-COA-R3-

CV, 2010 WL 5289798, *5 (Tenn. Ct. App. Dec.17, 2010) (referring to harm to reputation

as a form of consequential damages) (citing United States v. Burke, 504 U.S. 229, 239, 112

S.Ct. 1867, 1873, 119 L.Ed.2d 34 (1992)). In addition, as previously discussed, the

Tennessee Supreme Court has defined the typical measure of damages in a breach of an

employment contract context; harm to reputation is not included in the Tennessee Supreme

Court’s measure of damages in this context. See Cantrell, 53 S.W.3d at 662. Thus, we must

conclude that damages caused by harm to reputation in a breach of an employment contract

context, if recoverable at all, are special damages pursuant to Rule 9.07. Accordingly,

regardless of whether harm to reputation is an appropriate measure of damages in a breach

of employment contract case, Mr. Hampton’s failure to plead such damages pursuant to Rule

9.07 is fatal to his claim. The trial court’s decision to grant summary judgment to the School

Board on this claim is, therefore, affirmed.

V. Conclusion

The judgment of the Macon County Circuit Court is reversed in part, affirmed in part,

and remanded to the trial court for all further proceedings as may be necessary and are

consistent with this Opinion. Costs of this appeal are taxed one-half to Appellant Dan C.

Hampton, and his surety, and one-half to Appellee Macon County Board of Education, for

all of which execution may issue if necessary.

_________________________________

J. STEVEN STAFFORD, JUDGE

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