Kashmiri v. Regents of the University of California

In Kashmiri v. Regents of the University of California (2007) 156 Cal.App.4th 809, the court concluded that because the University's statement promising not to raise the professional degree fee was sufficiently specific, unequivocal, and unqualified, "the reasonable expectation of the parties would be that once the student enrolls in the University and the University accepts his or her payment of the professional degree fee (PDF), the PDF will remain the same of the duration of the student's enrollment in that program." (Kashmiri, supra, 156 Cal.App.4th at p. 833.) The court observed, "It is reasonable that an institution of higher education would promise not to increase the PDF for continuing students in exchange for the student's promise to attend that institution." (Ibid.) The court also stated that "students at UC presumably made choices about which professional program to attend based on the University's promises about fees." (Id. at p. 841.) The Kashmiri court rejected the University's contention that its policy regarding increases in the professional degree fee was binding for one academic year only. (See Kashmiri, supra, 156 Cal.App.4th at pp. 839-841.) The court stated: "The contractual relationship between students and educational institutions can encompass promises that expire at the end of the term and other promises that extend throughout the student's enrollment in the program. When an institution of higher learning makes a promise that extends for the entire length of a student's enrollment in the institution or program, courts have not limited the agreement to a single term or semester." (Id. at p. 840.) In support of its conclusion that the promise not to raise the professional degree fee extended beyond the current academic year, the Kashmiri court noted that, unlike promises that do not contain a time period and presumptively apply only to the year in which they are made, the promise not to raise the professional degree fee expressly stated it would apply for the duration of a student's enrollment. (Id. at p. 841.) The court in Kashmiri also rejected the University's claim that it could disregard its commitment to maintain professional degree fees constant for continuing students in light of its general disclaimer that fees could be changed without notice. (Kashmiri, supra, 156 Cal.App.4th at pp. 833-834.) The court relied upon the general principle in contract interpretation that " 'a particular intent will control a general one that is inconsistent with it.' " (Id. at p. 833; see Civ. Code, 1650.) The court also observed that the University had complete control over the language it used in its catalogues and on its Web sites. Under standard rules of contract interpretation involving uncertainty not resolved by other rules, " 'the language of a contract should be interpreted most strongly against the party who caused the uncertainty to exist.' " (Kashmiri, supra, 156 Cal.App.4th at p. 834.) According to the court, "if the University intended to retain the right to raise the PDF for continuing students, it should have so specified." (Ibid.) Thus, the University could not complain that its more specific promise not to raise the professional degree fee for continuing students took precedence over its general disclaimer that fees could change without notice. (Ibid.) In Kashmiri, the trial court rejected the University's argument that the plaintiffs' recovery should be reduced by all grant aid awarded, including amounts that students would have received even if the University had not increased the fees. (Kashmiri, supra, 156 Cal.App.4th at p. 848.) On appeal, the University abandoned its argument that damages should be reduced by all financial aid received, regardless of source, and instead claimed the damages award should be reduced by amounts of aid actually provided by the University, as distinguished from financial aid provided from other sources. (Id. at p. 849.) However, the University conceded that the factual record did not provide a basis for distinguishing between gift aid provided by the University and that provided by third-party sources. The appellate court rejected the University's challenge to the award of damages on the ground it could not support its new argument with evidence from the record. (Ibid.)