Three days before a board election, a school district board of trustees entered into an eight-month contract with its interim superintendent. Under the terms of the contract, the superintendent was to be paid $10,000 per month. Within a month after the election, the new board placed the superintendent on administrative leave with pay. It subsequently terminated his employment after it determined the superintendent engaged in misconduct in his handling of contracts and employee stipends, and violated the district’s bidding procedures.

The superintendent’s contract contained an early termination provision that specified he would not challenge the termination if the board paid him severance pay equal to the pay he would have received for the remainder of his contract, up to $60,000. The superintendent requested that the board pay the severance pursuant to this clause, and the board refused. The superintendent then filed a grievance, which was denied by the board.

The issue was litigated and appealed to the Third Court of Appeals, which ruled that the district did not have to pay the severance pay. When the superintendent engaged in the misconduct for which his employment was terminated, he failed to fulfill a requirement in his contract that he “faithfully execute the duties of the superintendent in accordance with applicable laws, TEA rules and regulations, and board policies.” Therefore, he was in breach of the contract at the time his employment was terminated and was not entitled to severance pay.