LONDON, Ky. (AP) - A jury ruled Friday that the University of the Cumberlands in eastern Kentucky was justified in not honoring a deal that would have required it to pay a former president nearly $400,000 in salary and benefits for the remainder of his life.
Former president Jim Taylor and his wife Dinah were seeking a lump-sum payment of $4.5 million in a federal lawsuit, The Lexington Herald-Leader reported . Friday’s ruling means the Baptist-affiliated university in Williamsburg doesn’t have to pay.
Taylor’s lawsuit turned on the issue of whether a retirement deal was a valid contract.
Taylor had been the university’s president from 1980 to October 2015. In 2005, the university’s board of trustees approved a plan for him to be named chancellor when he retired as president. It called for him to continue receiving the same pay that he had as president for the rest of his life as well as other benefits, according to the lawsuit. If Taylor died before his wife, she was to continue receiving his salary and benefits.
The package was worth at least $395,000 annually, the lawsuit said. Trustees approved the deal as a contract in 2012 and then reaffirmed it in 2015, the lawsuit stated.
A new administration balked at paying and, according to a court document, the school cut off salaries for Jim and Dinah Taylor in 2016. The university said the retirement package didn’t require him to work.
A court document says the school continued paying for some things including long-term care insurance for the couple.
The university’s attorney, Barbara B. Edelman, said trustees didn’t approve the deal. Edelman said a longtime board chairman who signed it was close to Taylor and didn’t have the authority to do so.
The deal was not on the agenda of the meeting where it was allegedly approved, was not passed out for trustees to go over, and was not filed in the university’s records, Edelman said.
John M. Sosbe, who represented the Taylors with D. Duane Cook, said that trustees approved the retirement package because Taylor had been a prolific fundraiser.
Sosbe said some trustees later claimed they couldn’t recall that, or didn’t vote for the package, because of a concern that they could have a problem with the Internal Revenue Service for approving an improper benefit for the Taylors. Sosbe said the deal was not excessive or improper, but that trustees got bad advice that it could be.
The university president, Larry Cockrum, said he was pleased that the jury ruled for the school.
“This verdict allows the university to direct all of its resources toward its mission of providing a quality, affordable education to students from all backgrounds,” Cockrum said in a statement.
Many of the school’s students come from Appalachia.
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Information from: Lexington Herald-Leader, http://www.kentucky.com
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