## Facts

- Bloomfield College, a private New Jersey college, faced declining enrollment and chronic financial strain, with significant liquidity problems but substantial assets.
- Faculty employment terms were governed by a Faculty Handbook establishing a tenure system: after seven years, faculty received tenure and could be terminated only for cause, except in “extraordinary circumstances” of institutional financial exigency.
- The Handbook required that any termination for financial exigency be “demonstrably bona fide.”
- In June 1973, the trustees adopted Resolution R-58, which terminated 13 tenured faculty members based on asserted financial exigency and converted remaining faculty appointments into one-year terminal contracts for 1973–1974.
- The resolution also created a faculty evaluation process to determine any retention beyond 1973–1974.
- After invoking financial exigency and terminating tenured faculty, the college hired 12 new, untenured faculty members between June and September 1973.
- The AAUP chapter and affected faculty sued for declaratory and equitable relief, including reinstatement and enforcement of tenure rights.

## Issues

1. Whether the Faculty Handbook’s tenure and termination provisions constituted binding contractual obligations between the college and faculty.
2. Whether the college’s 1973 financial condition qualified as “extraordinary circumstances” of institutional financial exigency permitting termination of tenured faculty.
3. Whether the college proved that its assertion of financial exigency and resulting terminations were “demonstrably bona fide,” as required by the Handbook.
4. Whether equitable relief, including reinstatement and restoration of tenure protections, was an appropriate remedy for a contractual breach of tenure rights.

## Decision

- The court held that the Faculty Handbook’s tenure provisions were part of the contractual relationship and bound the college.
- The court found the college did not establish the kind of institutional financial exigency contemplated by the Handbook and did not demonstrate that the asserted exigency and terminations were bona fide.
- Resolution R-58’s terminations of tenured faculty and conversion of continuing appointments into one-year terminal contracts were declared invalid.
- The court ordered equitable relief, including reinstatement of terminated faculty and restoration of the tenure system, concluding damages would be inadequate.

## Legal Principles

- A private college’s faculty handbook may create enforceable contractual rights when it is adopted, relied on, and integrated into the employment relationship.
- A contractual “financial exigency” exception to tenure is construed narrowly and requires proof of a genuine, institution-threatening financial emergency, not merely chronic deficits or cash-flow difficulties.
- Where a handbook requires that exigency terminations be “demonstrably bona fide,” the institution bears the burden to substantiate both the existence of exigency and the good-faith necessity of the resulting measures.
- Conduct inconsistent with asserted exigency—such as hiring additional faculty shortly after terminating tenured faculty—may support a finding that exigency was not bona fide.
- When tenure is treated as a central contractual protection, specific performance and reinstatement may be appropriate where damages would not adequately remedy the loss of position and tenure rights.

## Conclusion

The court enforced the faculty handbook’s tenure provisions as contractual commitments, rejected the college’s unsupported claim of bona fide financial exigency, invalidated the mass terminations and conversion to terminal contracts, and ordered reinstatement and restoration of tenure protections.


Am. Ass’n of Univ. Professors, Bloomfield Coll. Chapter v. Bloomfield Coll., 129 N.J. Super. 249, 322 A.2d 846 (Ch. Div. 1974)