Unfair sanctions in student contracts

The Office of Fair Trading has now published a report into its investigation of the fairness of certain terms in student-university contracts under various pieces of consumer protection legislation.

The OFT report notes that ultimately it would be a matter for a court to decide, but its view is that:

"use of and reliance upon contract terms that allow the university to withhold graduation or progression or otherwise exclude students from tuition for non-payment of ancillary services, in a blanket fashion and regardless of the circumstances, is open to challenge as potentially unfair under the Unfair Terms in Consumer Contracts Regulations 1999..."

Although noting no widespread concern, the OFT has also taken the view under the 1999 Regulations that:

"terms providing a university with a wide discretion in matters of student discipline, without the requirement to liaise with the student concerned or the ability for students to contest the issue and appeal against any decision, would be likely to be unfair..."

The OFT recommends that:

"universities review their rules and regulations, other terms and conditions, and practices in light of the OFT's views outlined in this report, and make amendments where necessary. We would expect universities to refrain from using unfair terms and practices, and from misleading students about either the university or student's legal rights."

The OFT has confirmed that it has closed this investigation but that its findings will be fed into its broader "call for information" about the provision of undergraduate higher education in England. Further details about the OFT's next steps have been promised in March.

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