## Facts

- The Regents of the University of California set systemwide student fees, including a general “educational fee” and, beginning in 1994, a “professional degree fee” (PDF) for certain professional graduate programs.
- When adopting the PDF, the University represented in official materials (including budget documents, websites, and catalogues) that any future PDF increases would apply only to new students and that continuing students’ PDFs would remain fixed for the duration of their professional program.
- From 1994 through 2002, the University increased PDFs but applied those increases only to new students, consistent with its representations and practice.
- In late 2002 and 2003, during a budget crisis, the Regents approved fee increases that departed from those representations and certain billing practices:
  - A PDF increase for Spring 2003 applied to both new and continuing professional students.
  - Educational fee increases for Spring 2003 were adopted after students had already received bills listing the prior amount.
  - Educational fee increases for Summer 2003 were adopted after students had been billed at the prior rate months earlier.
- Students sued individually and on behalf of certified subclasses, seeking declaratory and injunctive relief and damages for breach of contract based on (i) the University’s PDF promises and (ii) term bills specifying exact fee amounts.

## Issues

1. Whether the University’s specific statements and conduct created enforceable implied-in-fact contracts limiting fee increases for (a) continuing professional students and (b) students who received individualized bills stating a specific fee amount for a term.
2. Whether general disclaimers that fees were “subject to change without notice,” or the Regents’ constitutional autonomy, prevented contract formation or enforcement.
3. Whether damages for overcharged fees had to be reduced by University-provided grants or financial aid.

## Decision

- The Court of Appeal affirmed summary judgment for the student classes.
- The court held implied-in-fact contracts existed between the University and the students based on specific representations and the parties’ conduct.
- The University breached its contracts by:
  - Increasing PDFs for continuing professional students after promising such fees would remain unchanged for the duration of their enrollment in the professional program; and
  - Increasing Spring and Summer 2003 educational fees after issuing individualized bills specifying the amount due for those terms.
- The court rejected the University’s request to offset damages by alleged grant or aid amounts because the record did not establish the claimed offset.

## Legal Principles

- A public university’s specific, promissory statements in official publications and communications, combined with student enrollment and payment, can create enforceable implied-in-fact contracts.
- Specific promises regarding fees can control over general “fees subject to change without notice” disclaimers when the promise is clear and directed to a defined student group.
- An individualized billing statement specifying an exact fee amount for a term can form a contract for that term’s fees once students accept by registering, remaining enrolled, or paying; a unilateral post-billing increase may constitute breach absent a contractual basis.
- The Regents’ constitutional autonomy does not exempt the University from liability for breaching voluntarily assumed contractual obligations.
- A damages offset requires an evidentiary record quantifying the amount to be deducted; unsupported assertions are insufficient.

## Conclusion

The court held that the University’s concrete fee promises to continuing professional students and its issuance of term bills for specific amounts created implied contracts that the University breached by later imposing higher fees, and it affirmed the resulting damages where the University failed to prove any offset.


Kashmiri v. Regents of the Univ. of Cal., 156 Cal. App. 4th 809, 67 Cal. Rptr. 3d 635 (Ct. App. 2007)