More consumer rights cases emerge from OfS and NTS

Two higher education providers have changed the terms and conditions in their student contracts after the Office for Students (OfS) referred concerns to National Trading Standards (NTS).

Jim is an Associate Editor (SUs) at Wonkhe

Terms that were considered to be unfair have now been removed or changed by Oxford Brookes University and Fairfield School of Business.

Trading Standards advised OfS that terms used by the providers caused a significant imbalance in the rights and obligations of each provider and its students, which caused detriment to students.

Some terms were not written in plain language, some were not transparent and others included payment terms that were not clear, as is required in law.

OfS originally announced its partnership with NTS two years ago. Then everything went very quiet – until case reports from three providers emerged in July. DK summarised them at the time – and I noted a few… consistency issues in the reports.

Oxford Brookes University

There’s a saga in the first one. OfS says it first engaged with Oxford Brookes in 2021 after it identified some aspects of terms and conditions in its enrolment contract with students that it considered were likely to be unfair.

Crucially, it was “aware” that the university had sought to rely on and enforce some of the terms it was concerned about on at least one occasion. The university then conducted a comprehensive review of its terms and conditions of enrolment as part of its response to OfS’ engagement and made several changes to its terms for the 2022-23 academic year.

We don’t know what those were – or if students entitled to any resolution got one – but then OfS identified several other issues in the updated terms that gave rise to other concerns about compliance with consumer protection law.

One was a clause limiting the university’s liability to 150 per cent of fees paid by students, except in cases of death or personal injury – ”capping” accountability is a practice considered “blacklisted” under contract law and the Consumer Rights Act 2015.

The second was an issue we’ve been tracking since the Competition and Markets Authority clarified its position back in May 2023 – a term limiting liability for “events outside our control” raised concerns due to its inclusion of scenarios like industrial action and staff illness, that “could reasonably fall within the university’s control and thus not qualify as force majeure”.

That sort of clause contradicts CMA guidance, which discourages using these events to limit liability. Although the term commits the university to mitigate impacts on students, it nonetheless seeks to limit the university’s responsibility in these areas.

A third concern was a strict order of precedence for university documents – it excluded any oral representations made to students that may have influenced their decision to enter the contract. That also contradicts CMA guidance, which asserts that information provided to students, whether written or spoken, should be considered part of the contract if it impacts their decision to enrol – making it legally binding.

Brookes removed all three.

Fairfield School of Business

For Fairfield, OfS engaged in 2023 over terms in its contracts regarding extra costs, which were unclear and potentially violated the Consumer Protection from Unfair Trading Regulations 2008, the Consumer Contracts Regulations 2013, and CMA guidance for UK higher education providers.

FSB made some revisions, but as far as OfS was concerned, further issues remained in the updated terms – so referred to NTS.

As in the Brookes case, one clause sought to override all prior communications, including oral statements – NTS deemed that likely unfair and unenforceable under the Consumer Rights Act 2015.

Another, requiring FSB students to cover the cost of a DBS check within three days without specifying the fee or providing a publicly available policy, was considered potentially misleading under consumer protection regulations. NTS thought the lack of upfront information breached CMA guidance, which says that essential details, like additional costs, must be clearly presented to prospective students before they decide on a course to avoid “misleading omissions.”

Some clauses allowed FSB to make extensive alterations to course delivery, including changes to timetables, class numbers, delivery methods, and location. NTS thought they gave FSB overly broad discretion to adjust significant course elements – CMA guidance suggests that changes should be narrowly defined, occur under specific circumstances, and be clearly communicated to help students anticipate potential impacts.

Another imposed a £15 late fee per missed instalment, 8 per cent interest on overdue payments, and a £30 charge for dishonoured cheques raised concerns – that didn’t align with CMA guidance, which advises that significant financial sanctions should be explicitly highlighted to students.

And a clause limiting FSB’s liability for losses related to the use of its computer equipment or software raised concerns because it sought to disclaim responsibility, a practice deemed “blacklisted” under contract law and the Consumer Rights Act 2015. Again, CMA guidance prohibits terms that unreasonably limit a provider’s liability to students.

The upshot of all of that was that FSB revised or removed all of the problematic clauses.

What’s next?

The theory of change here remains that OfS/NTS identifies bad practice, emails everyone, and hopes that providers will change tack.

Is it working? The last time I looked late on in the summer, I could only find 31 universities in England that had deleted industrial action with their own staff from their force majeure clause – presumably because many are awaiting the results of the UCL part of the Student Group Claim, where that clause appears to be a key issue.

More broadly, OfS has been promising a consultation on the C conditions for an age now – it was in the 2022-23 business plan, the 2023-24 business plan, and the 2024-25 one too – having been repeatedly promised ever since Jo Johnson promised it would on the creation of the regulator in 2017.

When it comes, OfS could just suggest a nationally compliant contract on a comply or explain basis. It really can’t be that hard to create one where providers delete the word Fibchester and replace with their own name – after all, we shouldn’t really be depending on a model that relies primarily on individual students challenging a provider for a breach of contract, because that places a burden on students in an undesirable way.

That last sentence is something that OfS said in its board paper on the issue in December 2019. It was right five years ago, and it’s right now.

2 responses to “More consumer rights cases emerge from OfS and NTS

  1. What, the OfS not doing things it said it would in a timely fashion – shock horror !!!

  2. Yes a standard contract – these days compliant with consumer law – was first suggested by me in ‘The University-Student Contract ‘ in 1992. Over time, I’ve been working with David Palfreyman to revise and update the text, latest ©️version published in our OUP textbook in 2021, pp 570-575 of ‘The Law of Higher Education’ 3rd edition, new edition planned for 2027. Currently drafting a revamp of the 1992 article to be published, I hope, in the same journal which accepted the original. Not necessary to wait for the new edition or the outcome of the UCL case in 2026/27! OfS could as Jim says, suggest a template. We have one ‘oven-ready.’ Anyone interested do feel free to contact me or David at OxCHEPS, New College Oxford.

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