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LOUISVILLE, Ky. (WDRB) – The University of the Cumberlands used “economic coercion against an elderly couple” to threaten the loss of benefits promised to its former president and his wife under a retirement agreement, according to a federal lawsuit.

James Taylor and his wife, Dinah, sued the Southern Baptist-affiliated school in Williamsburg, Ky., in U.S. District Court in London on Monday. They claim university officials are trying to renege on a deal promising to cover their health insurance, provide an apartment and continue to pay Taylor a salary even after he retired.

The Taylors, who live in Florida, allege in the lawsuit that the school’s board of trustees voted in 2005 to keep paying the couple’s salary and benefits – at least $395,000 a year -- after James Taylor’s retirement and appoint him as chancellor. Those commitments were outlined in a 2012 contract between the couple and the university, the lawsuit says.

The Taylors filed a motion Wednesday night asking a judge to keep the university from terminating the benefits the couple claims they’re owed.

The university said in a statement that it tried to settle the dispute for more than a year before the lawsuit was filed and offered James Taylor benefits of more than $150,000 a year for “part-time employment.”

“The university could not agree to use student’s tuition payments and the faithful support from its donors in such an irresponsible manner,” the statement says. “The university exists to provide an opportunity for students of all backgrounds, especially those in the Appalachian region, to have a college education. The university does not exist to unfairly benefit a single individual, no matter how long he has served the university.”

James Taylor, 70, was named president of Cumberland College in 1980; it changed its name to the University of the Cumberlands in 2005.

He became the university’s chancellor after he retired last October, but the school offered him a one-year contract at a “salary substantially below” the one agreed to in 2012, the couple claims in the lawsuit.

If he didn’t agree to the new contract, the lawsuit says, the school would end its relationship with him, stop paying benefits and cut off use of a university apartment in Williamsburg, cell phone and vehicle.

The university has told the Taylors it will no longer honor the agreement reached in 2012 and “their retirement benefits have been terminated,” according to court documents.

The Taylors are suing for breach of contract, emotional distress and slander, saying people acting on behalf of the university have told others that Taylor hid the agreement from trustees and “had the contract drawn up in a deceitful or scheming manner.”

James C. Oaks, a former university board chairman, said in an affidavit filed with the lawsuit that trustees voted unanimously in 2005 to pay James Taylor’s salary and benefits after his retirement. He said “it was the sense of all board members” that James Taylor was paid less than presidents at comparable institutions and the couple had helped raise hundreds of millions of dollars for the university.

But the university said in its statement that the 2012 agreement was not disclosed to the board until eight months after James Taylor retired and the university is “strongly of the opinion that the document was never shown to the Board of Trustees before it was signed, nor properly approved by the Board.”

The lawsuit says the couple don’t know how they will pay healthcare and other costs.

“The Taylors are just heartbroken about this,” said D. Duane Cook, the couple’s Georgetown, Ky., attorney.

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