The University of Manchester

Students have a right to fair, clear and accessible terms and conditions in the contract they have with their university or college so that they benefit from the protections of consumer law and understand their rights. This case study provides an example of our work to protect students’ consumer rights before and during their studies.

We have also published a version of this case study for students to explain the sort of contract terms that could undermine their consumer rights, and what they should look out for when reviewing terms and conditions.

Where students, their representatives and students’ unions have concerns about terms and conditions, they should raise these with their university or college. If this doesn’t lead to a satisfactory outcome, they can raise a complaint with the Office for the Independent Adjudicator. They can also notify us about concerns that a university or college is not meeting its obligation to uphold students’ consumer rights.

Only a court can determine whether consumer law has been breached. This case report sets out work the OfS and Trading Standards have done to ensure providers’ student contracts do not contain terms and conditions that could be deemed unfair or to affect students’ consumer rights.

Case overview

The OfS referred the University of Manchester to National Trading Standards in 2023, because we identified some aspects of the terms and conditions in the university’s enrolment contract with students that we considered were likely to be unfair. A Trading Standards assessment identified terms in the university’s terms and conditions that it considered could be deemed to be unfair and may not comply with the provisions of Part 2 of the Consumer Rights Act 2015. The university worked with Trading Standards to change its terms, and informed current and re-enrolling students of the revised terms and conditions. Because the university took action to address these issues, the OfS is taking no further regulatory action.

This case study sets out the OfS’s role in protecting students’ consumer rights, and shows how our partnership with National Trading Standards works in practice to identify and assess whether a higher education provider’s terms and conditions could be deemed to be unfair under consumer protection law.¹ It explores the terms and conditions we had concerns about in this case, and how these were resolved through our partnership with Trading Standards and the action it took.

We encourage other universities and colleges to use this case study to familiarise themselves with their legal obligations and to revisit their own terms and conditions where that is necessary to ensure compliance with consumer protection legislation. Any changes should be communicated clearly to students.

The consumer rights issue

The OfS engaged with the University of Manchester in 2022 after we identified some aspects of terms and conditions in its enrolment contract with students that we considered were likely to be unfair. The university told us that it had not sought to enforce some of these terms and that it had made changes to its terms for the 2023-24 academic year.

However, we identified several issues in the updated terms which gave rise to other concerns about compliance with consumer protection law.

The clauses we were particularly concerned about were:

'Our liability to you for all loss or damage suffered by you shall be limited to the total amount of the Tuition Fees payable by you to the University whilst enrolled on the Programme at the University'.

We were concerned about this term because it seeks to limit the university’s liability. Such terms are blacklisted² because they contradict contract law and the provisions of the Consumer Rights Act 2015 as outlined in paragraph 5:30 of the Competition and Markets Authority (CMA) guidance for higher education providers,³ as well as paragraph 5.6.1 of the CMA’s Unfair Contract Terms Guidance,⁴ which states 'If a contract is to be fully and equally binding on both trader and consumer, each party should be entitled to full compensation where the other fails to honour its obligations. Clauses which limit the trader’s liability are open to the same objections as those which exclude it altogether.'

The university said that it had never sought to rely on or enforce this term. However, we remained concerned because the term is blacklisted and its inclusion in the contract could mean that students assumed that it was acceptable and they had no choice but to accept it. Students may have taken this into account when making decisions on where to study.

'We shall not be liable to you for the impact of events outside our control which we could not have foreseen or prevented, even if we had taken reasonable care, as long as we have taken reasonable and proportionate steps to mitigate the impact of these events. Such events include: strikes; other industrial action; staff illness […].'

We were concerned about this term because it listed examples that could reasonably be within the university’s control and therefore unlikely to be classified as a force majeure (an event for which no party can be held accountable) and should not be used to limit liability.⁵ This is contrary to paragraphs 5.22 to 5.24 of the CMA guidance to higher education providers. While the clause goes on to commit the university to taking reasonable and proportionate steps to mitigate the impact on students, the term still seeks to limit liability.

'We will review Tuition Fees annually and may increase Tuition Fees for subsequent academic years in the circumstances and on the basis of identified in your offer letter.'

We were concerned about this term as it gave the university a broad discretion to increase fees over the duration of the course with no explanation of how any increases would be made, the circumstances in which an increase would be made and whether there is a mechanism for an increase or a cap on any increase. In addition, there is no reference within the term about whether a student has the right to cancel the contract if the final price is too high. There is also no attempt to limit this wide variation to 'minor adjustments which are unlikely to negatively impact students’, or to ‘changes that are required by necessity’ as advised in paragraph 5.18 of the CMA guidance for higher education providers. The university told us that it had never sought to rely on or enforce this term. However, we remained concerned because students could have assumed that the university would enforce this term and they may have taken its inclusion in the terms of enrolment into account when making decisions about where to study.

'In the rare event that applicants have accepted offers with us and we are then not able to accommodate them on their Programme (this will usually only occur if there is a UK Government or Professional, Statutory or Regulatory Body imposed limit on numbers), we will look to offer those applicants various choices, including offering to defer their place to a later year, joining a different Programme with us, or being assisted to find a place on a similar programme with another higher education provider. We will also consider paying financial recompense depending on the options applicants choose.'

We were concerned about this term because it required further explanation and clarification to ensure it was not open to more than one interpretation. We were also concerned that its vague wording gave the university broad discretion to decide when it could be used.

The Trading Standards assessment

Due to our concerns about the university’s updated terms, we referred the case to National Trading Standards. Through our partnership, Trading Standards will examine each referral it receives from the OfS. The agreement means that we are supported by Trading Standards’ expertise in understanding and enforcing consumer protection legislation so that together we are able to effectively protect students’ consumer rights.

Trading Standards advised the university that some aspects of its terms and conditions may not comply with the provisions of the Consumer Rights Act 2015, Part 2 Unfair Terms. Trading Standards advised the OfS that it considered these terms could be deemed unfair under the legislation because the terms as written caused significant imbalance in the rights and obligations of the university and students, which causes detriment to students.⁶

Resolving the issue

The university responded to the advice from Trading Standards by updating its contract with students for the 2024-25 academic year. The main changes the university made were:

• The clause which limited liability to students for all loss or damage suffered to the total amount of the tuition fees paid while enrolled at the university was removed.
• The wording which limited liability for industrial action was narrowed to apply only to industrial action by non-university staff.
• The clause which related to tuition fees was amended to clearly state that tuition fees will remain the same as those applied in the first year of study unless stated otherwise in the offer letter.
• The wording relating to oversubscribed programmes was updated to state that the provider would consider paying evidenced expenses for finding a suitable course at another institution if it is unable to accommodate applicants. This update included further information about where students can access information on the provider’s refund and compensation policy which sets out the factors it would normally consider, and the approach the university would follow when assessing appropriate compensation payments.

These changes were also made to the terms for the 2023-24 academic year, with the changes highlighted to the students affected. The university updated the enrolment page on its website to make new and re-enrolling students aware of the changes, as requested by Trading Standards.

The university received general advice on compliance with consumer protection law and Trading Standards closed the case with no further action. The OfS is not taking any further regulatory action on these issues. We will continue to refer cases to National Trading Standards where we have concerns, and we expect to publish further case reports explaining the outcomes of these cases.

Notes

[1] See 'New OfS-National Trading Standards partnership to protect students’ rights as consumers'.

[2] Part 2 of the Consumer Rights Act 2015 contains terms and notices that are automatically unenforceable against consumers. Part 1 of the Act also blacklists certain terms and notices, making them automatically unenforceable and open to challenge.

[3] The CMA updated this guidance in May 2023. However, all references to specific parts of the guidance in this case report refer to the CMA guidance published in 2015 and in place when the concerns were first identified by the OfS and referred to NTS. As a result, some paragraph numbers have changed in the updated guidance.

[4] See 'Unfair contract terms guidance: Guidance on the unfair terms provisions in the Consumer Rights Act 2015'.

[5] Force majeure is a contract clause that removes liability for certain acts, events or circumstances beyond the reasonable control of parties.

[6] The Consumer Rights Act 2015 contains an indicative and non-exhaustive list in Part 2 Schedule 2 of terms that may be regarded as unfair, known as the grey list. This also applies to terms that have the same purpose or effect as terms on the grey list. However, these terms are not automatically unfair.