What a sad story! I hope you will find a new daycare ASAP. Personally, I would not want to send my child back to that daycare...if she is struggling so much with it and so unhappy with it, that is not a good environment for your child to be in! Is there any way you can take a leave of absence from work in order to find a daycare? I just would worry that she has no reason to provide excellent care to your child now that she doesn't need your business nor does she need your reference as she won't be doing daycare...plus her character has shown some less than wonderful traits with keeping your security deposit...and she has admitted she is struggling...sounds like a recipe for disaster to me