Cordero v. Mont. St. Univ.

417 Mont. 385

ANTHONY CORDERO, on behalf of himself and all others similarly situated, Plaintiffs and Appellants,

v.MONTANA STATE UNIVERSITY and WADED CRUZADO, Defendants and Appellees.

No. DA 23-0564.

Submitted on Briefs June 5, 2024.

Decided August 6, 2024.

2024 MT 167.

417 Mont. 385.

__P.3d__.

Appeal from the District Court of Lewis and Clark County.

First Judicial District Court, Cause No. BDV-2020-1975.

Honorable Michael F. McMahon, Judge.

Because a student had not specifically alleged that a university violated an express, written promise to provide in-person educational services and an on-campus experience in exchange for tuition, he had not stated a claim for breach of express contract, Mont. Code Ann. § 28-2-103; the district court properly awarded summary judgment in favor of the university because there was no genuine issue of material fact regarding whether it breached its contractual duties with respect to tuition. There was no express promise in the students application and documents that the university would provide a complete in-person, on-campus educational experience; because the university kept its facilities open, maintained, or available for students to use in person or online, the student was not entitled to a prorated refund of the mandatory fees he paid.

Affirmed.

For Appellants: Adrian A. Miller, Michelle M. Sullivan, Sullivan Miller Law PLLC, Billings; Michael Tompkins, Anthony Alesandro, Leeds Brown Law, P.C., Carle Place, New York.

For Appellees: Dale R. Cockrell, Eric M. Brooks, Braden S. Murphy, Moore, Cockrell, Goicoechea & Johnson, Kalispell.

JUSTICE GUSTAFSON delivered the Opinion of the Court.

¶1 Anthony Cordero (Cordero) was a student at Montana State University (MSU) during the Spring semester of 2020. Cordero sued MSU, requesting prorated reimbursement of his tuition and fees, when it transitioned to online learning due to the COVID-19 pandemic. The First Judicial District Court of Lewis and Clark County dismissed four of Cordero’s six claims against MSU in its Dismissal Motion Order on October 26, 2021, and granted summary judgment in favor of MSU on Cordero’s remaining claims in its Order on Pending Motions on August 22, 2023. Cordero appeals both Orders. We affirm.

¶2 We restate the issues on appeal as follows:

1. Whether MSU had an express contractual duty to provide in-person and on-campus education and services to Cordero during the spring semester of 2020.

2. Whether the District Court erred when it dismissed Cordero’s implied contract claim under M. R. Civ. P. 12(b)(6).

3. Whether the District Court erred when it dismissed Cordero’s unjust enrichment claim under M. R. Civ. P. 12(b)(6).

FACTUAL AND PROCEDURAL BACKGROUND

¶3 On March 23, 2020, MSU transitioned its campus services and educational instruction online due to the COVID-19 pandemic. However, MSU kept the majority of its physical campus open and operational through the remainder of the Spring 2020 semester to offer services to students who required them. The campus fitness center and fitness domes were temporarily closed, but MSU continued to maintain them. Intramural activities were stopped for the remainder of the semester, but the practice fields remained open to students. Computer labs remained open. The library was closed to in-person patrons, but library services remained available online, and students could still arrange to check out books. The health centers on campus remained open, as did the parking lots. As a result of these transitions, Cordero filed an amended complaint on February 26, 2021, against MSU and the university’s President, Waded Cruzado. Cordero asserted six claims: (1) breach of express contract, (2) breach of implied contract, (3) a due process violation, (4) unjust enrichment, (5) violation of the takings clause, and (6) inverse condemnation.

¶4 Cordero asserted MSU entered a contract with him through the admission process whereby MSU promised to provide an on-campus education with in-person instruction, campus facilities, services, and resources in exchange for his tuition and fee payments. Cordero claims he did not register or enroll in MSU’s online program, but rather he enrolled and paid the full price of tuition to attend MSU’s physical campus. Cordero alleges he paid $19,901 for his Spring 2020 semester, including a student building fee of $22.50, a non-resident building fee of $15.20, a bus fee of $5.25, an equipment fee of $23.22, an intramural fee of $23.70, an information technology fee of $46.10, an outdoor recreation fee of $8.31, a recreational facility fee of $13.38, a student facilities enhancement fee of $27.90, a student leadership fee of $6.37, a student organization fee of $9.89, a student press fee of $2.70, and several other fees.

¶5 According to Cordero, his contract with MSU arose from language within MSU’s course catalogue, student bill of rights, student handbook, acceptance letter, and website. Cordero claims these documents, combined with representations made during the application, acceptance, enrollment, and registration processes, defined the terms of their agreement to provide on-campus education in exchange for tuition and mandatory fees. For example, Cordero points to language in the course catalogue that provides students will be able to make friends in the residence hall, connect with the community, use the computers throughout campus, participate in music ensembles, and eat on campus.

¶6 Cordero asserted that MSU breached its contract when it closed its campus and stopped providing in-person instruction and on-campus facilities while retaining his tuition. Cordero claimed MSU replaced its in-person program with MSU online without allowing him to pay the lower price MSU online students pay. Cordero argued he was entitled to an award of money damages including prorated reimbursement of the tuition, fees, and other expenses for services and facilities that MSU failed to fully deliver.

¶7 MSU filed a M. R. Civ. P. 12(b)(6) motion to dismiss Cordero’s complaint. The District Court dismissed Cordero’s claims for breach of implied contract, due process, takings, and unjust enrichment, but found Cordero’s claims for breach of express contract and inverse condemnation withstood Rule 12(b)(6) scrutiny.¹ MSU then filed a motion for summary judgement, arguing the alleged express contract between Cordero and MSU did not exist, and MSU’s actions were pursuant to the State’s power to protect the health and safety of students and employees. Cordero also filed a motion to certify the case as a class action for all MSU students impacted by the on-campus closure. The District Court granted MSU’s summary judgment motion and denied Cordero’s class certification motion. The court determined Cordero’s breach of express contract claim failed because he did not identify a specific, bargained-for promise made by MSU. As for Cordero’s inverse condemnation claim, the court determined Cordero had no compensable property interest in the tuition and fees he voluntarily paid for his Spring 2020 semester. Cordero appeals only the District Court’s Order dismissing his implied contract and unjust enrichment claims under M. R. Civ. P. 12(b)(6) and the court’s Order granting summary judgment in favor of MSU for the express contract claim.

STANDARD OF REVIEW

¶8 [1] This Court reviews a district court’s ruling on a M. R. Civ. P. 12(b)(6) motion to dismiss de novo. Marshall v. Safeco Ins. Co., 2018 MT 45, ¶ 6, 390 Mont. 358, 413 P.3d 828. When reviewing an order dismissing a complaint under M. R. Civ. P. 12(b)(6), we construe the complaint in the light most favorable to the plaintiff. Marshall, ¶ 6. The district court must not dismiss a complaint for failure to state a claim, "unless it appears beyond doubt the plaintiff can prove no set of facts in support of his claim that would entitle him to relief." Marshall, ¶ 6. The district court’s ruling that a complaint failed to state a claim is a conclusion of law that we review for correctness. Marshall, ¶ 6.

¶9 [2] We review district court summary judgment rulings de novo for conformance to the applicable standards specified in M. R. Civ. P. 56. Dick Anderson Constr., Inc. v. Monroe Prop. Co., 2011 MT 138, ¶ 16, 361 Mont. 30, 255 P.3d 1257. Summary judgment is only appropriate when there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. M. R. Civ. P. 56(c)(3). A genuine issue of material fact is a fact materially inconsistent with proof of an essential element of a claim or defense at issue. Lawrence v. Pasha, 2023 MT 150, ¶ 8, 413 Mont. 149, 533 P.3d 1029.

¶10 [3] To meet the Rule 56 burden of demonstrating that a genuine issue of material fact exists, the non-moving party must in proper form, and by more than mere denial, speculation, or pleading allegation, set out specific facts showing the existence of a genuine issue of material fact. M. R. Civ. P. 56(e)(2). The opposing party’s "proffered evidence must be material and of a substantial nature, not fanciful, frivolous, gauzy or merely suspicious." Estate of Willson v. Addison, 2011 MT 179, ¶ 14, 361 Mont. 269, 258 P.3d 410. Whether a genuine issue of material fact exists or whether a party is entitled to judgment as a matter of law are conclusions of law that we review de novo for correctness. Lawrence, ¶ 9.

DISCUSSION

¶11 1. Whether MSU had an express contractual duty to provide in-person and on-campus education and services to Cordero during the spring semester of 2020.

A. Tuition²

¶12 The District Court determined there was no express contract between Cordero and MSU that required MSU to provide, at all times, in-person educational services. The court noted there was nothing in the record indicating an actual bargained-for agreement between Cordero and MSU. Cordero asserts he does not challenge MSU’s decision to close campus during the COVID-19 pandemic, rather he challenges MSU’s failure to provide him a refund for the fees and...