In brief - Schools are strongly encouraged to review student enrolment contracts in light of a recent Supreme Court decision which found that an independent Catholic school was unable to recover unpaid tuition fees due to ambiguous provisions in the school’s enrolment documentation.
The enrolment contract
The enrolment contract between the school and parents is a legally binding document. In the event of disputes, such as unpaid fees, the enrolment contract will be the basis of any fee recovery action. It is therefore critically important that its terms clearly outline the relationship between the school and the student’s parents or guardian.
Unfortunately, many enrolment contracts we see schools using are outdated, inadequate, and in some cases contain unlawful terms.
Recent supreme court case
A recent case in South Australia found that an independent Catholic school was unable to recover almost $20,000 in unpaid tuition fees from a parent because the original enrolment contract signed by the parents in 2009 contained the following deficiencies:
it did not make it clear that the relationship between the school and the parents was an ongoing one;
it did not expressly state that the contract would continue in force beyond the end of each school year unless subsequent steps were taken;
it indicated that school fees would be reviewed each year, which was suggestive of a series of annual contracts, rather than one underlying contract.
The application for enrolment issued by the school included acknowledgments that the signing parent agreed to pay the fees “in accordance with the College Board policy”, as well as any debt recovery costs.
Following lengthy litigation, the Supreme Court of South Australia determined that the school was unable to rely upon the original enrolment contract to recover unpaid school fees in respect of the 2017 and 2018 school years, because the school and the mother had entered into a series of annual contracts inadvertently, which superseded the original enrolment contract.
While the outcome of the case largely turned on the particular facts, it demonstrates that parents are more willing than ever to engage in litigation when schools seek to recover unpaid tuition fees. As a consequence, enrolment documentation must be robust enough to withstand judicial scrutiny.
Key terms in enrolment documentation that require attention
Enrolment documentation should be drafted to ensure the following issues are addressed with sufficient detail:
parents must disclose information about the physical, learning or other disabilities of their child and the process the school will undertake to consider reasonable adjustments, in accordance with disability discrimination laws;
family law court orders should be provided, thereby enabling the school to understand any obligations imposed in relation to the information that can be provided to separated parents, such as school reports or school photos;
fee recovery must be carefully articulated including the circumstances where fees are payable even where there has been some disruption to the child’s education, such as illness or allegations of student-on-student bullying;
conditions of enrolment, containing the school’s policies and procedures should be expressly incorporated into the enrolment documentation as binding contractual obligations on students and parents;
schools who accept enrolments from international students must include various mandatory terms in enrolment documentation stipulated by the National Code of Practice for Providers of Education and Training to Overseas Students 2018; and
consideration should be given to whether a dedicated Parent Code of Conduct is required, to set expectations relating to appropriate behaviours and responsibilities of parents/guardians including the consequences of non-compliance.
Considering the array of statutory and common law responsibilities facing schools today, along with the tendency for parents to litigate in response to fee recovery, a careful review of enrolment documentation is strongly recommended to guard against the emerging legal risks in this area.
This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2020.