SYDNEY (JTA) — The fired principal of a major Jewish school in Melbourne reached an out-of-court settlement on the eve of his unfair dismissal case in the Federal Court.

Joseph Gerassi, who is gay, sued Bialik College for millions of dollars in damages to his reputation and for lost income after he was dismissed by the board in 2011. The two parties settled for an undisclosed sum, according to a report in the Sydney Morning Herald.

In a letter, Bialik President Graham Goldsmith said the relationship between Gerassi and the college’s board “had irretrievably broken down” but that his termination was not due to “any dishonesty or misconduct on his part whatsoever.”

There is no evidence that Gerassi, who is believed to be the first openly gay principal of a Jewish school in Australia, was fired because of his sexuality, according to the Herald.

Gerassi, a former teacher at the King David School in Johannesburg,South Africa, was ordered to resign or his employment would be terminated immediately.

Goldsmith acknowledged in his letter that the board could have handled the “manner in which his dismissal was carried out” differently.

“I don’t know of any private schools in Australia where there are openly gay principals,” the newspaper quoted Gerassi as saying. “Boards of schools are quite conservative and would prefer not to have to deal with the issue. I’m not saying they are homophobic — it’s just easier having someone who is not gay heading up a school.”