St. Charles Community Unit School District 303 officials agreed to pay more than $660,000 to a former insurance carrier earlier this month with the hopes of ending a decade-long lawsuit stemming from the 2001 discovery of mold at St. Charles East High School.
After a closed session at an Aug. 11 meeting, school board members voted unanimously to pay the Illinois School District Agency $660,000 plus court fees and interest in accordance with a recent order by a Cook County Circuit Court judge “with the understanding that this finalizes all actions by ISDA against the school district,” the resolution read.
In 2003, the agency sued District 303, alleging that the district breached its contract with the agency when it received $660,000 in settlements from three other insurance carriers as a result of the mold problem.
The agency argued that it, not the district, was due the settlement money because it helped litigate and pay for costs associated with mold-related injury claims, according to court documents.
“The district’s contention was that there were a lot of additional costs that were not covered by the insurance company,” said Superintendent Don Schlomann, who added that he has tried to settle with the agency twice before since joining the district in 2007.
In the order, issued July 30, the court ruled that the district owed the agency the $660,000 in damages, after finding earlier this year that the district breached its contract with the agency. The court fees and interest amount to an additional $3,000, Schlomann said.
“We’ve paid that amount to them as per the court order,” Schlomann said, adding that the payment came out of the district’s tort fund. “Our expectation is they probably will appeal based on legal fees that they’re seeking.”
The agency paid nearly $1 million to defend and settle mold injury claims brought against the district and was seeking an additional $374,000 in pre-judg ment interest, according to the 8-page court order. The court determined, however, that “especially in light of the length of these proceedings” an award of $660,000 was appropriate because it “neither betters ISDA’s pre-breach position nor gives ISDA a windfall,” the order read.
On Aug. 13, the agency filed a motion to include the prejudgment interest in the award, according to court documents. A hearing on that motion is set for Sept. 16.
A call to the agency was not returned on Monday.
“I think it would be time for this thing to be settled and go away and hopefully it is,” Schlomann said.
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