Board seeks dismissal from suit

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Cannelton school trustees were added to Chapman civil filing

Managing Editor

CANNELTON – Members of Cannelton’s school board will be represented in a mediation session Dec. 16 about their being added as defendants in a civil lawsuit against former Schools Superintendent Al Chapman.

Indiana Attorney General Greg Zoeller filed the lawsuit Aug. 24, 2012 against Chapman and the Indiana Insurance Co. As the News reported in several stories, the board fired Chapman in December 2011 after accusing him, among other things, of failing “to manage the financial affairs of the school corporation in a prudent, reasonable, or professional manner resulting in financial problems and extra expense for the corporation.”

The civil lawsuit was amended Dec. 13 to include board members Bill Garrett, Barbara Beard, Jerry Harris, Cory Faulkenberg and James Lawson. The document adding them asserts “defendants are either delinquent officers or sureties of the officers … against whom recovery of misappropriated, diverted or unaccounted for funds may be had.”

Chapman was also named in a Jan. 14, 2013 criminal filing charging him with two counts of theft, a Class C felony, and two counts of official misconduct, a Class D felony. Those charges stemmed from a state audit that found Chapman allegedly collected $206,688 more than his contract authorized and misspent a $333,333 trust.

Current Superintendent Alva Sibbitt provided board members in a regular meeting Nov. 21 a letter from James Stephenson of the Stephenson, Morow and Semler legal firm of Indianapolis. It notes a mediation session has been scheduled for Dec. 16 in Bloomington. None of the board members are required to attend it.

Sibbitt also provided a document showing Dubois Superior Court Special Judge Mark McConnell granted the board a hearing on a motion to dismiss them from the civil suit. It’s scheduled for 1 p.m. Jan. 23 in Dubois Superior Court. Acting on a Sept. 24, 2012 motion for a change of judge, McConnell was named special judge in the case 16 days later.

Stephenson thinks the judge will grant the dismissal, Sibbitt told the board. “I do, too. I’m not a lawyer, but I don’t think … it’s legal to sue school-board members individually when they have not committed any crime. That’s what (Zoeller) did and I think they’re wrong. Our attorneys think they’re wrong; they represent the Evansville-Vanderburgh (County) schools and they know what they’re doing.”

Money from the trust was supposed to have been deposited so interest could be generated to benefit the city’s school system. Instead, it was put into the school corporation’s general fund, then transferred to its capital-projects fund and spent, the current superintendent explained.

The amendment notes school-board members have a duty to account for all of the corporation’s funds and “wrongfully or negligently expended, approved and/or allowed to be expended the principle of the Dorothy von Solbrig Income Trust.”

In his original suit, the attorney general was seeking repayment of that trust money, Sibbitt told the board, but corporation attorney Patrick Shoulders “thinks they may drop that part and try to get back from the  insurance company the portion that Mr. Chapman was overpaid, plus (some) fictitious claims he turned in … I don’t know if the insurance company will do that, but that’s what this meeting is for.”

“They always have mediation in a civil suit before you go to trial,” he added. “They try to settle it out of court.”

Sibbitt has been working since he replaced Chapman to relieve the corporation of a budget deficit exasperated by the alleged financial misdeeds.

“I’m optimistic,” he said. “If we could get the $300,000 back, we’d be about $170,000 in the black. We could pay off all of our debts except the IRS. And Mr. Shoulders thinks he can settle with them for $100,000.”

As the News reported in late 2011, board members listed failure to pay state and federal taxes when due among reasons for firing Chapman.

“So things are looking a little bit better,” Sibbitt concluded.

The board will next meet Dec. 12, a change from the originally scheduled Dec. 19.