COA says town didn’t defame employee after audit

The Indiana Court of Appeals reversed a decision denying a town summary judgment after a former employee claimed defamatory damages when the town fired her after completing an audit.

The COA remanded the case to the trial court, ordering it to grant summary judgment in favor of West Terre Haute.

Judy Roach was an employee of the town of West Terre Haute when during an audit, the State Board of Accounts found around $360,000 was missing. After an investigation by the SBOA, the clerk-treasurer and deputy clerk-treasurer were found liable in 2011 for the missing cash. The audit also found Roach had cashed personal checks from money paid by customers on more than one occasion. Roach’s personal assets were later unfrozen, the garnishment of her assets was dissolved and criminal charges were not filed against her after the investigation was completed. She was terminated in August 2011.

However, almost two years, later Roach filed a complaint against the state of Indiana, the SBOA and the town alleging defamation, negligence, malicious prosecution of a civil action and wrongful discharge and damage to reputation, seeking damages.

All defendants moved for summary judgment, and it was granted for everyone but the town. The town moved to certify the trial court’s order for interlocutory appeal; the court granted the motion and the COA accepted jurisdiction.

Roach alleged that the town’s failure to hold a pre-termination or name clearing hearing supported her claim for money damages. Her argument was based on Article 1, Section 12 of the Indiana Constitution, which says among other things “justice shall be administered freely, and without purchase; completely, and without denial; speedily, and without delay.” Roach said that didn’t happen, but the COA said the state constitution does not provide a specific remedy for violations of state constitutional rights. It found the trial court erred by denying the town summary judgment on that point.

Also, the COA said the trial court erred by saying there is material fact precluding summary judgment. Roach claimed defamation, but the COA said there were no grounds for it. Roach needed to include specific examples of defamatory statements in her suit, and did not. The statements she included were not defamatory, therefore there was no case and summary judgment should have been granted to the town.

The case is Town of West Terre Haute vs Jody Roach, 84A01-1503-CT-106.