Decision as to whether a provider was obliged to offer 2015 fees to student who withdrew from the course and opted to defer his studies until 2016, or to provide a full refund of fees paid.

Friday, November 24, 2017
S V P  [2017]  ISC November 2017 (2)

Issue

  1. This decision relates to a complaint from the Student against the education provider [the Provider].
  2. The Student enrolled in a full year course with the Provider, paying the full years fee $19,755.00 prior to the course commencement. The Student completed the first semester albeit commencing late and obtaining poor results and repeated the first semester again which increased the study length from 1 year to 18 months.  Prior to commencing the second semester, the Student elected to withdraw from the programme stating that the 2016 course fee had increased unfairly and they could not afford to pay it. (The Student was apparently unlawfully in NZ therefore unable to attend class).
  3. The Student applied to the Provider for a reduced (2015 level) fee or to complete their studies for free. The Provider offered a place to the student in the 2016 and 2017 years and declined a reduction of fee to 2015 level. The Student stated “ I just want [the Provider] to [sic] responsible for my condition and let me finish my degree free of cost.” ([Student name] email Sent: Wednesday, September 6, 2017 10:20 AM)
  4. Given the parties could not resolve the dispute directly, the Student made a complaint to the International Student Contract Dispute Resolution Scheme.
  5. A mediation was programmed to be undertaken on 28th September 2017 with the adjudicator as mediator - from which a settlement could not be reached. The Student did not attend the mediated meeting. The Provider did attend in good faith. I now proceed to issue an adjudicated decision on the complaint.

Outcome

  1. The Student’s complaints cannot be upheld. The Provider’s ‘fee schedules’ (for 2015 and 2016) and refund policy does not require that a partial refund be provided or that the Provider’s fee was incorrect. I cannot see any other legal obligation held by the Provider requiring any refund or adjustment of course fees as requested by the Student.

Background

  1. The Provider is an internationally recognised Education provider, which delivers various courses in [City name].
  2. On 10th June 2015 the Student, [Student name] accepted an offer to study toward a Graduate Diploma in [subject name]. The acceptance form records a start date of 17/07 2015, and end date of 30/06 2016. On the respective forms, the Student ticked a box indicating he had “read and understood the International Refund Policy’, which was attached to the offer of study.
  3. The Student commenced the programme a little late and under certain conditions, completing the first semester with poor results. 
  4. The Student, [Student name], asked the Provider, in a face to face meeting in early 2016, to apply for instalments for his study to the following year (2016) as they had been unwell and fell behind in their studies (this was approved). The Provider considered that the medical certificate offered for 2015 did not relate to the period of study. The Student was however offered a place in their 2016 (and 2017) enrolment. The Student was advised that each year the fees are adjusted and the Student is liable for payment of the fees applicable to the year of study.
  5. About tuition fees, and the 10/06 2015 Offer, [Provider contact] submitted that ‘the 1st offer of place states that the tuition fees for the 2015 enrolment were set at NZ $19,200.00. The four papers the Student enrolled in from July to November 2015 were $2,400.00 each totalling $9,600.00 for that intake. Page 5 of the ‘offer of place’, states that “the tuition fees quoted on the invoice are the tuition fees for the programme offered, -enrolling into extra/repeating papers additional charges will apply” and 
  6. The Student’s [Students name] academic Transcript shows the papers they were enrolled in 2015 (and failed) and repeated again in 2016. Given there was a fee increase in 2016 the four papers were $2,500.00 per paper in total NZ$10,000.00. The last papers the Student needed to do were ‘[Topic names] -total fees being NZ$10,800.00.
  7. [Provider contact] advised the Provider was prepared to defer the student’s course for a period of up to one full year with full preservation of the course fee already paid. This has not been taken up by the student.  
  1. (c) Summary of the Account
         RECEIPTS

         21/07/2015                                                                $19,775.00

         Total                                                                          $19,775.00

          INVOICES

          Insurance 29/07/2015 to 31/07/2016                             $581.00

          Tuition July to Nov 2015                                             $9,600.00

          Tuition Feb to June 216                                            $10,000.00

          Instalment application fee                                                $75.00

          Total                                                                         $20,256.00

  1. Given the parties could not resolve the dispute directly, the Student lodged a complaint with the International Student Contract Dispute Resolution Scheme;
  2. A mediated meeting was convened 28/09 2017 to take place in [City name] by skype (for the Student) and in person [for the Provider] to attempt to resolve the dispute. The Student did not attend the mediation. The Provider was represented by [Provider contact names] - a settlement of the dispute could not be reached at mediation in the absence of the Student.

Position of the parties

Students position as submitted to the Provider 27/07/ 2017

I am writing to you today as I wish to make a formal complaint about unfair fees for the second year of the course.  I have already taken the initial steps to resolve this on a department level, by speaking to [Provider contact], however up to this point they have failed to provide a satisfactory outcome or the explanation given to me. The explanation given I don’t believe is acceptable so I am taking the action to raise my concerns with you.

On the 29th of February, I was advised what my total course fee would be for the year. It was $15,486.00 as listed in Attachment 1. Now I have received further information stating that in fact I owe $20,000 not the $15,486.00 as originally advised (email dated July 21st).

I believe this sudden increase of my fee has caused me distress and anxiety which I have been engaging in professional Counselling services to manage my anxiety.

I enrolled in this college as to get my degree in grad dip in [Subject] on July 2015, due to my late enrolment, I couldn’t catch up the course and I couldn’t manage to take part in the exam due to my health (mental issue). I lodged a companionate consideration to the international office, after the investigation, they made an arrangement and I was entitled to make a payment for the whole course as mentioned in my attachment 1.

After that I was convinced my fees were to be $15,486.00 as listed in Attachment 1. Therefore, I attended every class, studied well, understand the course better and passed every subject of first semester.

Since I am from poor country and manage $20,000 loan to get here and get a degree and have experience here, I cannot afford more money to pay in any cost, now my visa is running out and I don’t have the additional money which they are asking for. When I get there and meet with [Provider Contact] to whom I correspond with since from beginning, [they] mail me with stating that the instalment [they] had made is for just 6 subject, which wasn’t mentioned anywhere in [their] previous mail.

As I am aware the [Provider] grad dip has 7 subjects for the degree. It is common knowledge that particular Degree is 7 Subjects, which is more confusing as to why the original cost did not reflect that as [Provider Contact] mentions.  

I enjoy my studies here at [Provider name] and would very much like to continue on.

Thank you and I look forward to hearing from you.

Yours sincerely

 [Student name]

AND to ISC online 02/08 2017

(a) I wish to make a complaint about unfair fees for the second year of the course.  I have already taken the initial steps to resolve this [with the] department of International Student, by taking lots of appointments, writing letter of complaint to [Provider contacts], however [this] failed to provide a satisfactory outcome or the explanation given to me.

The explanation given, I don’t believe is acceptable so I am taking the action to raise my concerns with you.

(b) On the 29th of February 2016, I was advised what my total course fee would be for the year. It was $15,486.00 as listed in Attachment 1. Now I have received further information stating
that in fact I owe $20,000 not the $15,486.00 as originally advised (email dated July 20).

I believe this sudden increase of my fee has caused me distress and anxiety which I have been engaging in professional Counselling services to manage my anxiety.

(c) I enrolled in this [Provider] as to get my degree in grad dip in [Subject] on July 2015, due to my late enrolment, I couldn’t catch up the course and I couldn’t manage to take part in the exam due to my health (mental issue). I lodged a companionate consideration to the international office, after the investigation, they made an arrangement and I was entitled to make a payment for the whole course as mentioned in my attachment 1.

(d) After that I was convinced my fees were to be $15,486.00 as listed in Attachment 1. Therefore, I attended every class, studied well, understand the course better and passed every subject of first semester.

(e) Since I am from poor country and manage $20,000 loan to get here and get a degree and have experience here, I cannot afford more money to pay in any cost, now my visa is running out and I don’t have the additional money which they are asking for.

(f) When I get there and meet with [Provider contact] to whom I correspond with since from beginning, [they] mail me with stating that the instalment [they] had made is for just subject, which wasn’t mentioned anywhere in [their] previous mail.

(g) As I am aware the [Provider name] grad dip has 7 subjects for the degree. It is common knowledge that particular Degree is 7 subjects, which is more confusing as to why the original cost did not reflect that as [Provider contact] mentions.

(h) I enjoy my studies and wish to continue.

  1. While the student acknowledged that the Provider had made offers to continue the course in a later semester, my impression from the submission was that the Student did not wish to / could not afford to continue the training at that level of fee. The Student did accept that when they enrolled with the provider, there was an intention to undertake a full one year programme.
  2. The student was advised to withdraw from the course as they could not afford the fee. They were advised to defer their studies to a later year.
  3. The Student’s position is that a reduction of the course fees should be made, and they consider this would be fair given that they had enrolled for the degree course at a certain fee. The Student explained in emails that declining to provide a reduction in fee (to the 2015 fee level) or study for free will result in hardship for the Student and their family.

Providers position

  1. The Providers position is that a refund / reduction in fees cannot be given, primarily as such a refund would fall outside the Fees Schedule / refund policy. Each year the fees reflect the cost of providing the course of study and the Student had not completed their studies in the year in which they had contracted to complete them.
  2. For [Provider name] [ Provider contact] explained that the Provider had a range of fixed and variable costs which had been incurred, on the basis that the Provider had undertaken to provide training to the Student over the remaining semesters. That included course materials that have already been provided to the student, staff and building costs. Furthermore, a commission had been paid to an agent who facilitated the Students enrolment. [Provider contact] advised it would not be possible to find a replacement student at short notice to offset any loss incurred, especially for this level of course.
  3. [Provider contact] considers that the Provider should be able to rely on the Fees schedules set each year and refund policy, provided prior to the students enrolling in the course, and reemphasised during the compulsory orientation for the course.
  4. Again, [Provider contact] confirmed that the student had been offered places on later courses at the appropriate fee level for that year, but as noted above, that offer was declined.

Discussion

  1. The question the International Student Contract Dispute Resolution Scheme must determine, is whether the Provider was correct in declining to amend the fee structure (to the 2015 level) or refund all or a portion of the Students course fees.
  2. The parties agree that the Student had enrolled in a full year course, and the Student confirmed it was initially their intention to attend and successfully complete the full year. It is also agreed that the Student failed to gain credits for all the papers and withdrew from the course before completing their degree because they would / could not pay the 2016 course fee as identified on the 29 February 2016 letter / summary of Account (referred to as Attachment 1 elsewhere). This stated that; 1st Instalment $9,292.00 due 22/02/16; 2nd instalment $6,194.00 due 25/07/16 – Student account credit was $9,499.00 therefore 1st instalment paid by that credit balance. Total to pay $15,486.00 for complete course. One more semester to complete the course in February 2017 would incur a fee of $10,901.00.

Contractual obligations

  1. At the time of enrolment, a contract was formed which created obligations for both parties. In short, the Student could expect the Provider to deliver the training, and the Provider could expect the fee to be paid for that training.
  2. When determining what the legal obligations are under the contract, I must consider what the terms of that contract are. The terms of the contract include the Fee schedule for the Contracted year (2015) and refund policy. That policy states in part:
  • By accepting a place in a program or course at [the Provider] a student enters a contract with [the Provider] for the period of one academic year (or the length of the course if less than one year). This contract means there is an obligation to pay the fee for the year (or the length of the shorter course). There is no automatic right to a refund of fees if a student changes his / her mind about studying at [Provider name].
  • Students who have paid fees for a programme that subsequently cancels, will receive a full refund.
  1. Importantly, I consider that the programme is the full year course for [the] 2015 -2016 year, not just a single semester course. I reach that view for the following reasons:
  1. The offer of study agreed to by the student, was for a programme running between 27/07 2015 and 30/06 2016.
  2. The Fee Schedule and refund policy refers to acceptance of the offer, as acceptance for a full year programme in 2015 - 2016.
  3. The programme is for a year which I accept cannot be achieved in only one semester, rather would be a two- semester course. Failure to complete the course and or attempt to repeat course in the following year will incur the fee schedule applying to that year (2016).
  1. Despite the terms of the contract for Fee Schedule and refund policy, the Provider could be found liable to refund fees etc. under the law of contract, if there was evidence to show that the Provider has breached the contract in some material way. However, there is no evidence supporting that situation. 

Other legal obligations

  1. As I have indicated above, the fee schedule and refund policy does not support eligibility to any level of refund to the student in this situation. I cannot see that the Provider would be liable to provide a refund on the basis of any mistake;
  2. I have also considered whether the Fees Schedule or refund policy, which forms part of the contract, would be breach the FairTrading Act 1986. That Act prohibits a contract term which is unfair. I cannot see that the terms would be unfair. The Provider has given sound justification for the fees set and declining to refund fees, when a withdrawal occurs part way through a course. In particular, the provider will incur costs in reliance of the student attending the course, and I also accept that it would not be realistic to anticipate that a replacement student could be found at short notice if the student left prematurely. That is especially the case for any withdrawal in the second or third trimester, when passing the first semester course is a pre-requisite to the later trimester training.

Code compliance

  1. I have considered the dispute in light of the Education (Pastoral Care of Internal Students) Code of Practice 2016 (“the Code”). 
  2. The Code provides a range of obligations on providers, which includes the requirement to have clear terms and conditions relating to the enrolment process, including termination.
  3. In my assessment the offer of enrolment form, including the obligations under the refund policy, are clear.  They are written using plain English. Clauses 29 and 30 of the Code specifically relate to managing withdrawal from courses, and provides specific requirements for refund policies. I am satisfied that the policy which applies with respect to voluntary withdrawal, does comply with those obligations.

Proposed Decision

  1. In the circumstances of this complaint, the Provider may decline to adjust its fee schedule or reimburse course fees as it has done. I can see no breach of any obligation on the part of the Provider; which show that the Provider has committed a wrong doing or that would require that any portion of the fees be reimbursed.

For those reasons, the proposed decision of the International Student Contract Dispute Resolution Scheme is that the complaint be dismissed.

Final Decision

As there have been NO submissions received to change / amend my Draft Decision. Accordingly, my Draft decision, circulated 24 November is now confirmed as my 'Final Decision'.

 

Dated: 24 November 2017 
Jay Clarke
Resolution Practitioner
International Student Contract Dispute Resolution Scheme