Isabelle Schuessler sat reading the newspaper in her house in Potomac March 8 when the phone rang. It was the rector of St. Patrick's, the church where she had headed the parish school for 21 years. He told her she was fired, effective immediately.

For Jim Steen, the 42-year-old rector of St. Patrick's, the firing was the final exchange in an increasingly bitter struggle over Schuessler and control of the school that had been going on for several years. An Episcopal priest all his adult life, he had been pilloried in public ;meetings about her, called a liar, a deceiver, a stonewaller and a fool. It had been the worst ordeal of his professional life.

St. Patrick's is a small (under 400 students) private elementary school connected to a small (around 200 in regular attendance) church off Foxhall Road. But its size is deceptive; during Schuessler's tenure the school had become one f the leading private elementary schools in Washington, attracting the children of the well-to-do and well-connected, parents who wanted their children on the track that leads to St. Albans, Landon, Sidwell Friends, National Cathedral School, Holton Arms or another of the schools considered appropriate by Washington's middle and upper classes. The waiting list at St. Patrick's -- annual tuition $5,025 -- is always long.

So the parents included people like Sen. Ted Stevens (R-Alaska), developer Carter Cafritz and columnist George Will, as well as lesser-known lobbyist and lawyers, and many of them were intensely involved in the school. The church, as well, had its separate share of wealthy and influential people.

But while their children frolicked on their new $170,000 ball field, these two groups -- and others somewhere between the camps -- were engaged in an intensely emotional struggle over Schuessler land her authority over a school even her opponents concede she had built into a model educational institution.

Parents found themselves crying in the school driveway, or crossing the street to avoid someone "on the other side.". More than one woman had to leave town for a while to get away from the pressure.

In the end, nearly half the board of trustees resigned, many in tears, as did all the officers of the Parents' Association. A few pledges of money to the school were withdrawn. Several people left the church as well. Judith Richards Hope, who is Bob Hope's daughter-in-law, has asked that a trust fund she established at the school in her mother's memory be moved to Holton Arms.

A group of disaffected parents set up a new school, the Washington Episcopal School, with Schuessler as its head. About 60 students and 13 faculty members are leaving St. Patrick's at the end of the school year this week to join it.

"I am not an emotional man," said lawyer Robert Freer, who now heads the board of the new school. "But I would drop my kids off and as I drove to my office I would find myself weeping. This has been a real tragedy."

The tale of Schuessler's downfall says something about the high stakes of private education in Washington, and the passion with which normally rational people react when they think their carefully crafted plans for their children are threatened. It also deals with problems of personality, money and the balance of power in a particular community, the community of St. Patrick's School, which has now undergone a rather public, very bitter divorce.

Like the famous Episcopal prep schools in New England, which were founded in part to allow Boston Brahmin youth to escape the wave of immigrants, Washington's non-Catholic private schools expanded in the '60s, in the wake of desegregation and the demise of the "honors" track in D.C. public schools. The shift was not simply a racial question -- although many viewed it as such -- but the result of a gradual erosion of confidence in the public schools. At any rate, today the harsh fact is that most white people in Washington -- like many middle-class blacks -- do not send their children to public schools. As the racial balance in the public schools began to change, the pressure on schools like St. Patrick's to add grades was immense.

Schuessler was hired at St. Patrick's in 1962, the year she graduated from George Washington University, a mother of four children. At that time the school was limited to the nursery grades; when Schuessler became assistant director in 1965, plans to expand were under way. She became director in 1966, and in 1967 the school began adding elementary grades, housing them in a succession of other locations until a new building was completed in 1977. But a few years later the church vestry and the school board decided to build a new building, connected to the one completed in 1977, that would house the church as well as the school.

Steen, who was hired by the church in 1979 to bring a more aggressive style of leadership to the parish, set up a joint church-school committee, using the slogan "Building Together for the future," to raise money. Two acres were purchased from Mount Vernon College for $750,000, and an chitect George Hartman was hired to produce a plan.

It was then, according to Schuessler and others, that the troubles realy began.

The school has always been governed by a 27-member board of trustees. made up of parents, church members and other people from the community Technically, the board reports to the vestry, the group of lay people that runs the church, but over the years the board came to consider itself an autonomous body; it issued condtracts approved budgets, raised tuition, and performed other routine functions.

Many parents felt equally casua about the school's link with the church. They felt that meant a sound value system and a certain nonrepressive strictness. They knew their children would be going to chapel once a week and taking a religion class, but that was all. Schuessler, after all, wasn't even an Episcopalian -- she's a Methodist -- and more than 85 percent of the school parents were not members of the church.

The church vestry, on the other hand, while content to let the school run itself, saw it as very much a product of the church. Its members thought, for example, that children of church members should have priority in admissions. Schuessler did not wholly agree. If two candidates were equally qualified she would take the parish member. But if the parish member was a less appealing student, she would not. Still, the issue was rarely put to the test.

Isabelle Schuessler, 52, is a tall, rather prim-looking woman. She grew up in Cleveland and Washington where her grandfather, Robert Crosser (D-Ohio), served as a congressman for 42 years. She married while still in college; her husband, a teacher, recently retired from the Montgomery County school system. She is the immidiate past president of the National Association of Episcopal Schools.

Schuessler's supporters as well as her detractors often describe her as "a strong personality.

"I don't know what that means," she said during a long interview. "But it's been my observation that you don't find leadership in weak personalities. A strong head means a strong school. With a weak head you get PR."

For most parents, her most outstanding attribute is evidenced by the school she has built. They describe a "warm, loving environment," with clear standards of achievement, dress and behavior, "wonderful teachers," and a lot of individual attention. Several parents said their children had entered the school with learning problems that disappeared after a while at St. Patrick's.

The leve of parent involvement in the school is extraordinarily high; a preliminary accreditation report called it "utopian." Former Parents Association president Virginia Snider, who resigned because of Schuessler's firing, said that 80 percent of the parents volunteered to help with activities or fund-raising, and as many contributed to the building fund.

Many parents sent their children to all six years at St. Patrick's, after which the youngsters hopefully would be accepted by one of the exclusive secondary schools in the area. Some parents, however, would move their children to Landon or St. Albans in the fourth or fifth grade to "beat the rush." The pressure to get children into the "right" secondary school is even greater than getting them into elementary school, and parents get very anxious about it.

(One board member recalled overhearing a child declare, "My father says if I don't get into St. Albans, I'll never get into Harvard Medical School.")

Several parents said Schuessler sometimes regarded these "beating the rush" departures as a betrayal, refusing to speak to the offending parents for as long as a year. Nonetheless, some of these same parents are throwing their lot in with her new school.

The parents interviewed generally believe that Schuessler has a direct pipeline to the heads of other local schools, and that if she thinks a child should be in St. Albans or NCS, she will get him or her in. "She always says your child will go to the school that is right for him," said board member and oil executive William McSweeney. "And most kids that I know will say years later she was right."

But those who disagreed with Schuessler's assessment of what was "right" for their child found her hard to deal with.

She also had a reputation for being tactless or indiscreet, making pejorative remarks about a person to that person's close friend, for example, or about another school without realizing her listener's daughter attended it. More serious was the complaint that she failed to respect confidentiality.

In addition, staff members complained that she was unable to delegate, second-guessed their work or did it over when it was turned in. This last matter, several people suggested, was a function of her dedication to the school, a commitment that bordered on obsession. It was not uncommon for her to work 18 hours a day, seven days a week, she said. Some admired this commitment; others found it excessive.

"Jim Steen told me that my problem was that I came to meetings too well prepared," she said.

Actually, Steen said, what he meant was that she came to meetings with her mind made up, unwilling to reach a consensus with others.

These complaints and others surfaced during an "evaluation" of Schuessler that began a year ago as part of an elaborate process she initiated to gain accreditation for St. Patrick's from the Middle States Association of Colleges and Schools.

At the same time, the new building was dedicated, amid balloons and blessings from the bishop. It is a lovely structure, the entrance framed by a brick courtyard, the sanctuary enclosed by sliding paneled glass doors that give an almost Oriental effect. But the building has been purchased with a lot of controversy.

According to the final accreditation report, for example, the vaulted ceilings in the nursery caused acoustical problems that had to be remedied at extra cost, the sinks are too high for the 3- and 4-year-olds who use them, and the rooms are too small.

In addition, no one seems to know just what it cost. Stephen Davenport, the school's chaplain and assistant director, who acted as contractor on some of the secondary work, says the total price tag will be about $4.5 million, including the purchase of the land, architects' fees and all construction costs.

But when board member Carter Cafritz asked for an accounting earlier this year, he was given only a handwritten list that included nine unpriced items. According to the document, the construction costs could be anything from $3.3 million to $3.7 million.

Prior to this, a group of parents who feared money they contributed for the new school rooms was being spent instead on the church had an unpleasant meeting with Steen and Joanne Kingdon, the church's senior warden. Although the immediate misunderstandings were smoothed over, many remained unhappy about the accounting of funds. A new computer and language lab, for which Freer and another parent contributed $40,000, is only now being finished, to their dismay.

An elaborate use analysis of the building was devised with Schuessler proportion shares of the building's cast between the church and the school. But in the minds of many the school, with its nearly $2 million a year income and wealthy backers, had a clear advantage over the church, with an income of around $350,000 a year. The church plans to pay for a large part of its share by selling its old building, possibly by the end of the swimmer, after which a church debt of $2.8 million will remain.

Several borad members said they believed the real reason for Schuesder's firing was to release her tight hold on the school's purse strings, allowing the church to use the school's steady flow of income to service its debts. Steen adamantly denies this.

By July, Steen said, Schuessler had been told of the results of her evaluation, with a clear understanding that if complaints against her persisted her contract would not be renewed. She denies any such understanding.

Most board members saw the evaluation of Schuessler as part of a useful effort to improve an already exempla- school. She had never had a job descrsiption, and this was an opportunity to develop one. A number of them -- possibly even a majority -- were not opposed to the idea that she might be urged to consider retirement in a year or so -- after having served 25 years. Yet slowly they began to realize that a can school employes were very unhappy and that Steen was quite determined to set a date for Schuessler's departure.

In September Steen reported lto the board that Schuessler had been defen- quarters with the church. It wasn't working out.

Now that Steen was in the same building wijth the school, those who had problems with Schuessler found in the rector a sympathetic ear. Suddenly they realized Schuessler had a boss. Schuessler and board member sympathetic to her began to notice new alliances and friendships developing. Were those people talking or plotting? Was Steen counseling people on their problems or becomingthe complaint center, legitimizing their discontent? Schuessler said she found mundane school work being neglected by her shared staff in favor of "more fun" work for the church, like planning parties. Feeling more isolated, she said, "I just withdrew to my office." To others "she was becoming paranoid." One teacher let it be known she could no longer work with Schuessler and would not return next year. But the liaison committee, according to one member, found that most of the teachers it had been told were unhappy were not.

Davenport, a rumpled man who looks a bit like a schoolboy who's always late to class, said he was hired as the school's assistant director to be "a buffer" between Schuessler and the church. He saw her as a "Lone Ranger," content only when she was in charge. She saw him as a warmhearted but sloppy fellow, always promising to do things that didn't get done. The two coexisted with apparent civilijty, but a collision was inevitable.

In Janurary the personnel committee reported back to the board, which decided to continue the liaison committee for Schuessler in an effort to work out the problems; the matter of renewing her contract was not to be discussed until June. But Steen said quite firmly that "absent radical change" she should leave; the only question was when.

Few on the board realized that his comment was more than an opinion: ing to several board members, Ackerly, a lawyer with Covington and Burling, was furious and called David Beers, the bishop's chancellor. Beers explained that under canon law the rector of a parish has the "spiritual jurisdiction" over a parish and the vestry controls the money. Thus, Steen and the vestry had the power to fire Schuessler; the school board was merely a group of opinions.

Over the next few days various board and vestry members managed to agree that Schuessler's contract would be extended for one year; she would be given a chance to respond to complaints against her and if Steen saw no improvement after a year he would ask her to leave.

But the compromise broke down. Joanne Kingdon and Steen didn't want to sisgn Schuessler's contract because they felt it would "send the wrong signals to the people with problems," as one board member put it. Both the vestry and the board met on Feb. 10. After a seven-hour meeting, the board adjourned thinking Steen would consider giving it authority to renew Schuessler's contract.

Over the following month the deal unraveled, as did the St. Patrick's community. There were endless meetings and endless rumors. In one meeting Steen was actually asked by a board member if he was having an affair with one of the discontended staff members. He denied it, as do others who should know. One pro-Schuessler board member was accused by an opponent of being part of a "Jewish cabal" on the board. Both incidents illustrate the level of hostility that developed.

On Feb. 20 Steen went to Schuessler's office and asked her to resign, effective in June. According to Schuessler, Steen said matters had gone too far; that he could no longer work with her. That nijght the executive committee of the Parensts Association met, as well as the board of trustees; both groups pleaded with Steen to rescind his request. He did.

Meanwhile a group of angry parents got together to talk about starting a new school. According to The next day Schuessler met with the St. Patrick's School faculty, a meeting that has since become a subject of some controversy.

According to one version, Schuessler told the teachers about the new school "in the interest of letting them know there were other options." According to Schuessler, she merely responded to a teacher's question about the new school, saying it was an inappropriate subject for discussion in St. Patrick's.

Davenport, who was at the meeting, said Schuessler brought up the subject of the new school but left the meeting when he objected to the inappropriateness of the topic.

Two days later a parents meeting was called. Between 350 and 400 parents showed up, and many of them were furious. They wanted to know if Schuessler was being fired, and if so why.

Both Schuessler and Steen were summoned. Schuessler, after gauging the emotional pitch of the gathering, retired to her office. Steen arrived sometime later, and reports of his performance vary.

"He came late and refused to answer any questions," said parent J. Thomas Malatesta, who is now helping the new school. "People came prepared to treat him with respect but when he wouldn't do anything we got pissed."

"It was embarrassing, it was appalling how rude the parents were to him," said parent Michael C. Durney, an attorney who is keeping his child at St. Patrick's. "A decision was made by the rector that she should go; it seemed like a reasonable management decision."

Steen said he told the parents that a school, like a child, needs "a different kind of parenting" as it grows and develops. Schuessler, he felt, "was incapable of changing, and there is no positive purpose to be served by going into particulars in great detail."

But these parents were men and women accustomed to having their questions avsnwered. Furthermore, 80 percent of them had been active volunteers, and they felt "owed" -- if not for their tuitions and annual gifts, then for their sweat and concern.

They wanted to know what exactly was wrong with Schuessler. If Stern wouldn't discuss "the charges" how substantial could they be?

The Parents Association passted out a questionnaire which included a question about setting up a new school. The results showed a majority in favor of some form of change in the official relationship between church and school. But Three days later the new school was formally incorporated.

Three days after that, March 8, Schuessler was told to clear out her desk, charged, in effect, with treason -- that she had aided and abetted the formation of a new school, a charge that she and her supporters vehemently deny.

The next day parents returned to the school for a meeting with Bishop Walker. Again some parents expected answers, and again the meeting turned ugly.

At one point a parent, trying to tell the bishop that people couldn't hear him, walked toward him, gesturing. The bishop, according to several people at the meeting, reacted as though he were being physically attacked, and called an end to the meeting. He later described the group as a "lynch mob."

Instead of answering questions, Walker and Steen were there to introduce the new interim headmaster, the Rev. Richard Downes, a former seminary classmate of Steen's. Downes was at work the next day.

The representative of the Middle States Association arrived the day before Schuessler was fired. MSA's preliminary accreditation report said the evaluation team had found not a school "in harmony, but in crisis . . . A school . . . truly at risk."

Accreditation was tabled until the school's "governance" is clear.

"Whether they fired her or not is not my business," said one member of the evaluation team. "But they should not destory the school in the process. It was so surreptitious you have to think there was something emotional and personal going on. We never ggot any straight answers from the vestry or clergy."

Sources said Steen has privately expressed regret at the wayy things unfolded, and holds himself responsible for the turmoil. Publicly he will say only "I did not think it would be easy, but I was as clear as I could be that it was something I had to do . . . I am truly sorry that there are people offended and hurt by this."

He and Downes said emphasically that the school is not at risk. Rather, a new note of enthusiasm and resolve is apparent. Several parents noted that Downes has put pictures drawn by the children in his office, and that he shakes each child's hand when he enters the school every day. Schuessler scoffed at this as "artificial," and said parents have told her of children asking "Do I have to shake his hand every day?"

The parents involved with the new school, which will lease space from the Pilgrim Lutheran Church in Bethesda, said they, too, are galvanzied. Board president Robert Freer said that over $10,000 has been given to the new school by parents who for one reason or another decided to stay at St. Patrick's; a total of $25,000 in gifts was received in a matter of weeks. Another $500,000 in loan guarantees was pledged within two days of the March 2 meeting with Steen, he said, and will be used to guarantee teachers' salaries and school expenses until tuitionLOFT 2,COPY,SY,ACT,COPY,,,long time," Miller said. "We needed big spaces, high ceilings and an industrial feel to the building. We didn't want to try this kind of development in a Victorian row house."

The building is a nondescript, three-story concrete-block structure that most recently housed Wood's Auto Repair. Large new windows and bright blue paint make the building stand out on the small street.

Each of the lofts is basically one large room. The four smaller units each have 1,100 square feet of floor space, 14-foot ceilings, the original 12-inch-wide pine floorboards, outdoor decks and elaborate security systems; indoor parking is provided. The largest unit measures 2,200 square feet, with two huge skylights and a spiral staircase leading to a 1,500-square-foot deck.

One of the units retains the five-foot gears that were used to raise the building's hand-cranked elevator. The elevator itself did not survive the renovation, but the gears mounted on the ceiling create a built-in industrial sculpture.

"The first two people who looked at the unit with the gears said they wanted them out," Miller said. "We were determined to keep them, and the third person grabbed the unit because of the gears. They are the focal point for that loft." Across the hall in Wennett's unit, paint that long ago was spattered on a wall by artist Sam Gilliam has been turned into high art. Gilliam, who used the top floor of the building as a studio in the mid-1960s, left walls speckled with gray, red, orange and blue paint. When the loft was painted white recently, Miller instructed the painters to carefully preserve two large patches of the colorful spatters.

The lofts commanded an up-scale price for condominiums of their size, said Steve Mowbray, a Realtor who has sold real estate in the 14th Street area for more than 10 years.

"There is a demand for a special product, and people are willing to pay a high price for something as special as those lofts," he said. "The type of person who would buy a loft near 14th Street is a forward-thinking person who can overlook the rustic aspects of the neighborhood."

Not everyone was taken by the open space concept of the lofts, Campbell said. "Some people who looked at them had to ask "Where is the bedroom?' " he said. "And others wanted to cover over the bare brick walls with plasterboards."

Wennett, 25, said that he looked at about 300 apartments and houses in April when he came to Washington to take a job as an acquisition officer for a realty firm and that buys and manages shopping centers. "I looked at everything available," he said. "I knew this was what I wanted as soon as I saw it."

Wennett said he wasn't put off by the nearby drugs and prostitution. "I like transitional neighborhoods because they tend to be eclectic," he said. "I don't want to live in a gentrified neighborhood. I've walked on 14th Street, and what is there is everyday life in New York."

The everyday life of 14th Street may be changing more quickly than expected now that a trendy restaurant is expected to open around the corner from the new condominiums.

Herb White, former owner of Herb's Restaurant near Dupont Circle, said he has a contract to buy 1714-16 14th St. NW. "If everything goes right, we will be open by next spring," White said. "We will have performance space, a gallery and a restaurant."

Miller applauded White's decision, but worried that the new interest in the area will exhaust the supply of buildings suitable for lofts. "Everything is getting bought up around 14th Street," he said. "We'd love to do some more lofts but there may not be anything left that we can afford to convert."