MBA Student’s Breach of Contract against Duke Fails to State a Claim — Elements of the Contract between a Student and Educational Institution

From Yurimindi v. Fuqua School of Business, 2011 U.S. App. LEXIS 13482 (3d Cir. July 1, 2011):

In his 119-page third amended complaint, Vamsidhar Vurimindi sued Duke University's Fuqua School of Business ("Duke"), his fellow students in a Duke weekend MBA program, and corporations that employed or allegedly employed those students. ***

In alleging a breach of contract, Vurimindi cited, as a basis for his purported contract with Duke, Duke's mission statement, its diversity statement, and its general statements against harassment. Vurimindi also alleged that Duke represented that it would help him advance his entrepreneurial activity, facilitate new relationships for him, prepare him to lead others and manage resources, and otherwise let him experience the "finest" weekend MBA program. In return, he noted that he paid Duke its tuition fee, incurred travel expenses, and lost income. He contended that Duke breached the alleged contract by allowing and encouraging his fellow students and professors to pick on and otherwise harass him; failing to offer a real estate finance course to advance his entrepreneurial interests or a business writing course that would help him achieve his networking and career goals; and by characterizing him as a threat on campus. ***

In Swartley [v. Hoffner, 734 A.2d 915, 919 (Pa. Super. Ct. 1999)], the Pennsylvania court describes the source of the terms of the contract — the guidelines, policies, and procedures contained in written materials provided to students over the course of their enrollment. See 734 A.2d at 919. It does not appear that a North Carolina court has explicitly held the same. However, in Ryan, in which the Court of Appeals of North Carolina considered whether a student could sue a university for breach of contract as a matter of first impression, the court cited Ross v. Creighton Univ., 957 F.2d 410 (7th Cir. 1992), at length. In Ross, in describing the limits of a contract action brought by a student against a school, the court stated that there is "'no dissent'" from the proposition that "'catalogues, bulletins, circulars, and regulations of the institution made available to the matriculant'" become part of the contract. See 957 F.2d at 416 (citations omitted). Although the Ryan court did not specifically cite to this part of the Ross analysis, we will assume that a North Carolina court would apply the rule from which the Seventh Circuit has said there is no dissent. But see Guiliani v. Duke Univ., 2010 U.S. Dist. LEXIS 32691, at *23-24 (M.D.N.C. Mar. 30, 2010) (requiring the incorporation of Duke's handbooks and policy manuals into a separate contract as in an employment context); Love v. Duke University, 776 F. Supp. 1070, 1075 (M.D.N.C. 1991) (holding that an academic bulletin is not a binding contract between a school and its students).

Applying these principles, Vurimindi cannot recover on his breach of contract claim. To the extent that Vurimindi presented a general complaint about the quality of the education that he received, his claim was not actionable. Furthermore, even though guidelines and policies can include specific promises on which to base a cause of action, Vurimindi did not point to any specific and definite terms that were violated in his case. In the portion of the mission statement that he presented, Duke describes its desire to provide the "highest quality education." The quoted statement contains no specific term that can be considered binding as a contract. Cf. Minehan v. United States, 75 Fed. Cl. 249, 260 (Fed. Cl. 2007) (holding that the aspirational mission statement of the IRS, which made no specific promise, could not be deemed the basis for a contract). Similarly, there are no definite contractual terms in the diversity statement, which explains that Duke "appreciates and values differences." The general anti-harassment policy that Vurimindi described did no more than present Duke's view that harassment is unacceptable because it is inconsistent with its stated commitment to excellence. Vurimindi cited no promises that Duke made regarding how he would be received by the other students or professors. Although Vurimindi also alleged that Duke did not offer courses that he wanted (and which he described as important to his educational experience), he did not claim that Duke had guaranteed him a real estate finance or business writing course in exchange for his tuition dollars. For these reasons, the District Court did not err in dismissing his breach of contract claim for failure to state a claim upon which relief can be granted.

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