Does the MAB mean students can claim a refund?

Whether we’re talking about the MAB specifically, or the year of industrial strife (including strikes) more generally, the Office for Students’ note on industrial action makes clear that in the event of disruption caused by industrial action, students may be entitled to remedies.

In the event of lost learning opportunities, that might mean they are rescheduled or delivered later in some way. We’ve been over that on here before.

This could mean providers giving students options to re-take certain elements of the course, rescheduling activities for a later date or delivering course content in a different way.

In addition CMA guidance explains that if a provider delivers a “substandard” service, then a student may be entitled to ask the provider to put this right.

Even if we set aside debates about the way in which some universities are getting marking done – and whether they meet the “reasonable skill and care” test – the significant delay to getting actual final marks in others that is now ensuing across parts of some universities would surely represent a substandard service.

In its note OfS says that if it got a concern, it would look at:

Whether the provider can demonstrate that it has followed its own processes and procedures for maintaining standards.

Does that mean following its procedures for marking and assessment, or following its own procedures for changing its own procedures for marking and assessment? Who knows.

But where a university isn’t going down the get-it-marked-by-someone-else route and is instead doing provisional awards and delayed final versions, Part 1 of the Consumer Rights Act provides statutory remedies to consumers for a breach of contract for the supply of services, in particular the right to repeat performance or (in certain circumstances) a refund.

No university with a MAB I’m aware of is giving up on getting the final degree marks to a student eventually. But while CMA would talk about “repeat performance” or delayed performance – a delay in performance can’t be indefinite.

CMA highlights where a provider might “only offer options outside a reasonable timeframe” or “with significant inconvenience to students” as situations where students may be entitled to a refund.

You can certainly see how some of the announcements to students about when they might get their work marked and therefore their final degree at least sound like they fit this bill.

The question then comes back to whether providers would be reasonable in treating industrial action as an act of god that’s outside of their control, or not. In other words, even if a university-student contract seeks to limit or exclude liability for strikes, the question is whether that clause is lawful.

A typical exclusion clause looks something like this – where the vast majority include industrial action on their list of god-acts:

The University shall not be liable to any person for any failure or delay in performing its obligations in the event that the University is unable to deliver programmes of study, research opportunities and other services or facilities described due to any cause beyond its reasonable control which will include, but not be limited to, any governmental action, strike action, civil and/or international commotion, fire, flood, war, labour disputes or act of God.

Such clauses don’t mean that a provider is totally off the hook – even if the act of God happens, there’s still a duty to minimise disruption, keep consumers informed, deliver in the end and so on.

But can a provider actually limit their liability at all?

The new CMA guidance on universities and students says this (my bolding):

Terms limiting liability are more likely to be regarded as fair where they are restricted in scope to problems unavoidably caused by factors beyond the trader’s control. The relevant circumstances should be clearly and specifically described, and in the CMA’s view there should be no listing of matters that could be within the trader’s control – for example industrial disputes with the trader’s own employees.

Some might say well, that only came out two weeks ago. But the line is derived from CMA guidance on unfair contract terms from 2015:

…to be clearly fair [exclusions] should only be matters which are genuinely outside the trader’s control, not situations such as…labour problems etc which can be the fault of the trader.

Another section, in relation to the right to cancel for fairness to be achieved, states:

…there should be not listing of matters that could be within the trader’s control – for example, industrial disputes with the trader’s own employees…

Almost all universities’ Ts and C’s include industrial action as something outside of its control – and so may argue that a national dispute is genuinely outside of their control.

The problem is that the clauses don’t say “national disputes” – they almost all say “industrial action” in general. And who knows whether a national dispute is one that would fit CMA’s definition.

At OfS’ recent event on consumer protection law, the clause on industrial disputes wasn’t really lingered on. The letter OfS has been sending to providers with a MAB does at least say:

Where the industrial action is having, or is likely to have, an adverse impact on your ability to complete marking and assessment to the timetable students expect, we would be extremely concerned about the possible impact of this on students.

It goes on to say:

If you are not confident you can secure these outcomes we expect there to be proactive engagement with the students directly affected to ensure they understand when they will receive assessment outcomes and are informed of the full range of options available to them. This includes their rights under consumer protection law and their right to complain to the Office of the Independent Adjudicator if they are dissatisfied with the outcomes of any internal complaints processes.

You’ll note it doesn’t mention what those rights might be in this scenario. It does however require providers to tell OfS – having reminded readers of the “reportable event” requirements, it makes clear that:

In the context of the current industrial action we are likely to consider that a decision to award degrees at a materially later date than originally planned, or to award unclassified, rather than classified, degrees, would need to be reported to us.

OfS’ reason for taking such a keen interest in this scenario – which you would assume would be a key issue in one of any number of sections in its regulatory framework – is not disclosed.

So – can providers limit their liability for this kind of substandard performance in contracts? If so, would the big delay to performance be reasonable? If not, what is anyone going to do about the contract clauses that are apparently in breach? And if universities are in breach of contract, do rights to a price reduction and/or claiming damages kick in?

Whether you regard students as consumers, students or both, these are very much the sorts of questions that need answers from the regulators that regulate on behalf of consumers and students respectively – but yet as ever clarity for them seems as distant as ever.