## Facts

- Nova University, a Florida nonprofit, operated a campus in Fort Lauderdale and offered graduate and doctoral programs.
- Nova ran “cluster” programs for out-of-state students: small groups met periodically in their home states for seminars, lectures, and examinations led or supervised by faculty.
- Nova sought to conduct these cluster instructional meetings in North Carolina for North Carolina residents; the in-state coursework would count toward Nova degrees.
- Students were required to attend summer institutes in Florida, and degrees were physically awarded in Florida.
- North Carolina’s Board of Governors claimed authority under N.C. Gen. Stat. § 116-15 to license and regulate nonpublic institutions that confer degrees in North Carolina.
- Although disputing the Board’s jurisdiction, Nova applied for a license; the Board denied the application.
- Nova filed a declaratory-judgment action asserting the Board lacked authority because Nova did not formally confer degrees in North Carolina.

## Issues

1. Whether N.C. Gen. Stat. § 116-15 authorizes the Board of Governors to license or regulate an out-of-state university conducting degree-oriented instruction in North Carolina when the formal act of conferring the degree occurs outside the state.
2. Whether “confer degrees in this State,” as used in § 116-15, is limited to the physical location where the diploma is awarded or includes in-state educational operations that are part of earning the degree.

## Decision

- The North Carolina Supreme Court reversed the Court of Appeals.
- The Court held that § 116-15 authorized the Board to regulate and require licensing of Nova’s North Carolina instructional program even though degrees were formally awarded in Florida.
- The Court rejected the view that the Board lacks power “so long as” degrees are not formally conferred in North Carolina.
- The effect of the decision was to deny Nova declaratory relief that the Board lacked statutory authority over Nova’s in-state program.

## Legal Principles

- Statutory terms concerning degree conferral under § 116-15 are construed functionally, not solely by the geographic location of the final conferral ceremony.
- The Board’s licensing authority extends to nonpublic institutions conducting substantial instructional activity in North Carolina that is intended to lead to academic degrees, even if the degree is issued outside North Carolina.
- Courts interpret § 116-15 in light of its protective purpose, including preventing circumvention of oversight through formalistic arrangements about where a diploma is awarded.
- When in-state instruction (e.g., lectures, discussions, examinations) is an integral component of a degree program offered to state residents, the program may be treated as within the statute’s regulatory reach.

## Conclusion

The court construed § 116-15 to permit North Carolina to regulate out-of-state universities that operate degree-oriented instructional programs within the state, holding that an institution cannot avoid licensing and oversight merely by arranging for the formal act of degree conferral to occur outside North Carolina.


Nova Univ. v. Bd. of Governors of Univ. of N.C., 305 N.C. 156, 287 S.E.2d 872 (N.C. 1982)