Implied Contract in Higher Education: The Necessity for Specific Promises in In-Person Learning Claims

Introduction

In this landmark decision, the Supreme Court of New York’s Fourth Department addressed a contentious issue arising from the educational disruptions caused by the COVID-19 pandemic. The case, Caleb McCudden on behalf of himself and similarly situated individuals versus Canisius College, centers on whether an implied contract existed between a university and its students promising exclusively in-person instruction. In the wake of the pandemic, when Canisius College shifted from in-person to remote online instruction for the spring 2020 semester, the plaintiff asserted causes of action for breach of contract, unjust enrichment, and conversion. The dispute primarily revolved around the adequacy of the student’s allegations concerning the loss of an in-person educational experience, especially as they pertained to the recovery of tuition and mandatory fees.

At the heart of the matter was the question of whether marketing materials, course catalogs, and other institutional communications could be interpreted as creating an implied contractual obligation to provide in-person instruction. The college, facing unprecedented disruption due to the public health crisis, defended its decision to transition to remote learning, arguing that no specific promise of in-person instruction was made. The case, after a bifurcated analysis of the various causes of action, resulted in a split decision at the motion to dismiss stage, leading both to a direct appeal from the plaintiff and a cross-appeal from the defendant.

Summary of the Judgment

The Fourth Department affirmed the order of the Erie County Supreme Court entered on September 7, 2023. The appellate decision upheld the dismissal of the breach of contract cause of action as it related to tuition and the unjust enrichment claim, while it maintained the court’s retention of the breach of contract claim regarding mandatory fees. Notably, the court’s opinion underscored that the plaintiff’s allegations were merely conclusory, lacking the necessary specificity required under New York law to establish a breach of an implied contract.

The majority opinion carefully examined factual allegations and legal standards, including a review of precedents whereby courts required a specific promise to provide exclusively in-person instruction. The appellate court rejected the plaintiff’s reliance on a more general promised educational experience, emphasizing that the requirements for breach of contract claims under an implied contract necessitate showing an unambiguous promise to deliver in-person learning. The dissent, however, argued for a broader interpretation, contending that the evidentiary record could support claims based on a general expectation of in-person services.

Analysis

Precedents Cited

The judgment extensively cites several precedents that have shaped the court’s approach to claims arising from educational settings:

Rynasko v. New York Univ.: The decision in Rynasko was pivotal in the plaintiff’s argument that an implied contract could exist based on general promises of in-person instruction. The plaintiff pointed to Rynasko as support for the idea that even vague promises could potentially give rise to a contractual obligation. However, the majority countered that the particular facts in Rynasko—a case involving a student with unique needs due to a chosen major—differ significantly and that New York law requires a more specific promise.
Croce v. St. Joseph’s Coll. of N.Y.: Here, the court emphasized that an implied contract claim must be underpinned by a specific promise to provide exclusively in-person learning. This case guided the majority in concluding that the plaintiff’s complaint, with only general allegations of in-person educational benefits, was insufficient.
KEEFE v. NEW YORK LAW SCHOOL: Cited to underline the principle that the establishment of an implied contract requires clear, unequivocal communication from the institution regarding the mode of education.
Other Cases (Maas, Olsson, Hansbrough, and Carr): These cases reinforce the broader legal perspective of deference to academic institutions’ internal decision-making and delineate the boundaries concerning the evaluation of implied contractual obligations in academic contexts.

The majority opinion draws heavily on these precedents to argue that vague or general promises do not satisfy the legal threshold required to establish a breach of an implied contract.

Legal Reasoning

The court’s legal reasoning was methodical and grounded in established New York contract law principles:

Standard for Motions to Dismiss: The court reiterated that on a motion to dismiss, presentations in the complaint are to be given a liberal construction. The factual allegations are accepted as true and accorded every favorable inference to the plaintiff, yet the allegations must still articulate a remedyable legal theory. The court referenced cases such as LEON v. MARTINEZ and Connaughton v. Chipotle Mexican Grill, Inc. to outline the balance between accepting allegations and dismissing bare legal conclusions.
Requirement of Specificity in Implied Contracts: Central to the reasoning was the need for specificity. The majority emphasized that for an implied contract claim to succeed, the plaintiff must allege not just a promise of some form of in-person education, but a clear commitment to provide exclusively in-person learning—a promise that was not sufficiently alleged in the amended complaint.
The Role of Factual Allegations: While the court concedes that factual allegations may sometimes support an implied contract claim, here they were largely conclusory. The details regarding the plaintiff’s specific course of study and the unique benefits expected from in-person learning were insufficiently elaborated to meet the statutory and case law standards.

In contrast, the dissenting opinion argued for a more expansive interpretation. It pointed to evidence in marketing materials and course catalogs that the plaintiff contended implied an overall promise of immersive, in-person education. Nonetheless, the majority maintained that legal precedent, particularly from Croce, demands a narrowly tailored allegation to support such claims in the procedural posture of a motion to dismiss.

Impact on Future Cases and Legal Landscape

This decision is expected to have significant ramifications in the realm of higher education law, particularly as it relates to claims arising from rapid shifts in educational delivery:

Clarification on Implied Contract Claims: The ruling reinforces that allegations of an implied contractual promise in higher education must be specific and clearly state that exclusively in-person services were promised. This limits the scope of breach of contract claims based solely on general promises, thereby potentially reducing frivolous litigation in the wake of emergency institutional decisions.
Guidance for Educational Institutions: The decision provides universities and colleges with clear guidance on the extent of their obligations regarding instructional promises. Institutions may now rely on the precedent as justification for transitioning to alternative learning modalities in emergency circumstances without incurring significant breach of contract liability.
Future Litigation Trends: Plaintiffs in similar situations will need to muster more precise evidence of contractual promises related to in-person education. The emphasis on specificity may compel institutions to be clearer in their marketing and official communications regarding educational delivery formats.

Overall, while the decision affirms significant deference to academic institutions’ discretion in structuring educational delivery, it also sets a stringent standard for when such discretion will be legally binding in contractual terms.

Complex Concepts Simplified

Several legal concepts and terminologies that may appear daunting are explained clearly within the context of the judgment:

Implied Contract: This refers to a contractual obligation that is not explicitly written or spoken but is inferred from the actions, statements, or conduct of the parties. In this case, the plaintiff argued that marketing materials and course catalogs implied that an in-person educational experience was guaranteed.
Conclusory Allegations: These are statements in a legal complaint that assert a legal conclusion without providing the factual details necessary to support that conclusion. The court found that the plaintiff’s allegations regarding the promised in-person education were mostly bare assertions rather than detailed factual claims.
Motion to Dismiss under CPLR 3211: This is a legal tool that allows a defendant to argue that even if all factual allegations are taken as true, the complaint does not constitute a viable legal claim. The court’s analysis centered on whether the plaintiff’s complaint met this baseline standard.

By breaking down these concepts, the judgment not only addresses the merits of the case but also serves as an instructive example for litigants and legal practitioners on the importance of detailed factual allegations in claims based on implied contracts.

Conclusion

The decision in McCudden v. Canisius College is a significant contribution to the evolving jurisprudence on implied contract claims in higher education contexts. The majority’s insistence on the need for a specific promise—namely, the promise to provide exclusively in-person learning—underscores a rigorous standard for establishing contractual obligations derived from institutional marketing and other representations. At the same time, the dissent’s broader interpretation highlights ongoing debates concerning deference to institutional decision-making in times of crisis.

Key takeaways from the judgment include:

The necessity for precise factual allegations in order to claim a breach of an implied contract in educational settings.
The reaffirmation of judicial deference to academic institutions when interpreting the scope of their promotional and operational commitments.
An emphasis on established New York law, as evidenced in Croce and related cases, which delineate the boundaries for acceptable claims based on implied contracts.

As higher education institutions continue to navigate the post-pandemic landscape, this case serves as an important precedent, guiding both universities and plaintiffs regarding the contractual expectations for in-person educational experiences. It marks a clear demarcation of legal thresholds that future cases will undoubtedly reference, thereby shaping contract claims within the academic domain for years to come.