OFT expectation fails and most OFT there where most it promises

The OFT has just published its report into universities’ terms and conditions. The report is at pains to remind us that the final decision on whether any term is unfair rests with the courts and the OFT’s latest views do not bind even itself in the future, let alone any other enforcement body, so there is a question as to how much reliance can be placed on its analysis. It is also, in this writer’s opinion at least, a report that lacks rigour in its analysis in key areas. Nevertheless, some of its more interesting findings include:
Student conduct
  • Rules about student conduct and the consequences of not following those rules need to be clearly set out to students and flagged up in advance. Some of the more arcane disciplinary procedures still in use in the sector may need a refresh to satisfy this requirement.
  • A reminder that rules around conduct should not include “surprising or onerous restrictions” on what would otherwise be students’ legal rights, with a special mention for freedom of expression and of association (if only I could go back and challenge my Pictionary-related episode of misconduct).
  • An emphasis on the paramount importance of due process and proportionality.
Academic sanctions and student debt
  • Terms that allow a university to impose academic sanctions for non-payment of ancillary services “in a blanket fashion and regardless of the circumstances” are “potentially unfair”, and may amount to unfair commercial practices. This seems to leave open the question of whether the practice of linking services is inherently unfair or only unfair if it meets these conditions.
  • One of the arguments relied on by the OFT in deciding that these terms are unfair is the fact that 25% of universities do not rely on them. Many institutions changed their terms in response to earlier indications that the OFT and others (eg the ARMED website) regarded such terms as unfair, so there is an element of self-fulfilling prophesy here.
  • The OFT highlights the need for earlier intervention to prevent debts accumulating and taking action, such as pursuing debt claims or withholding services of the same type. Will we therefore see more students sued in the small claims court, evicted from accommodation mid-way through their studies and/or denied, for example, childcare support? What impact will this have on the student’s overall experience and studies? The OFT suggests any adverse impact will be minimal, but this remains to be seen.
  • The OFT states that terms with which consumers do not have the chance to become acquainted prior to being bound by them may be challenged as unfair. Providing the relevant rules and regulations at enrolment is unlikely to meet the requirement for advance notice. Further, the OFT identifies that some terms and conditions do not meet the requirements for plain and intelligible language.
The OFT recommends that, in light of its findings, universities should proactively review their terms and conditions. For some at least this might mean an extended period of redrafting, as well as the need for a fundamental overhaul of some pretty long-standing practices.

Smita Jamdar
Partner and Head of Education
For and on behalf of SGH Martineau LLP
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E: smita.jamdar@sghmartineau.com
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