Understanding Enrollment Agreements

Understanding Enrollment Agreements
Attorney Sara Goldsmith Schwartz answers my questions and provides some general guidance regarding best practices for enrollment agreements.

Editor's note:

I asked Attorney Sara Goldsmith Schwartz, whose "practice is focused on the critical issues facing school administrators and leadership," to answer my questions and provide some general guidance regarding best practices for enrollment agreements. This article is intended for the information of owners, administrators, and trustees of small to medium size private schools. ~ Rob Kennedy

The relationship between parents, students, and the school is determined by contract law. Can you tell us what that means?

The relationship between parents, students, and the school is based on a lot of documents, including the student/parent handbook, the code of conduct, the enrollment agreement, and more. The enrollment agreement, however, is the only legal contract, and it memorializes the relationship between the parents, students, and the school, binding the parties to the terms and conditions laid out in the agreement. The agreement assists schools in collecting tuition and fees in cases of non-payment and in assessing late fees in cases of late payment. However, a comprehensive agreement addresses far more than tuition and fees.

This short clip explains why contracts are important legal documents.

How can a professionally written enrollment agreement prevent litigation in the future?

A properly drafted enrollment agreement is a cornerstone of a school’s risk management strategy. For instance, it can help deter parents from bringing claims against the school, as well as help the school prevail on such claims.

An enrollment agreement that comports with best practices and applicable law will establish behavioral standards and require compliance with handbooks, policies, and codes of conduct. We include a broad parental comportment provision, for instance, as well as a statement about divorce and custody disputes.

The ideal enrollment agreement will exclude provisions and language that should not be included in the agreement, and that may expose the school to liability. For example, a school might decide to remove language in the enrollment agreement that serves as an “all-purpose permission slip” because a blanket release may not be as enforceable as carefully tailored trip permission and release forms.

Many schools are embracing electronic enrollment agreements. These have certain advantages, but they require additional legal hoops to help ensure the enforceability of the electronic signature.

Finally, many schools’ tuition plans trigger The Truth in Lending Act (TILA), a federal law that applies to institutions that regularly extend credit in certain scenarios. If schools are not in compliance with TILA, the school could face civil and criminal penalties. An experienced education attorney will prepare an ideal enrollment agreement, analyze electronic signature considerations, and help the school determine if it is covered by TILA and, if so, how to comply with TILA.

What informational and training sessions should the school hold in order to explain the terms of its enrollment agreement and the enforcement of those terms? Who should attend those sessions?

Administrators who are responsible for the implementation of the enrollment agreements at the school (often employees in the Admissions, Business, and Registrar’s Offices), whether they are responsible for distributing, collecting, or maintaining the agreements, should understand all of the provisions. We offer a webinar for schools about drafting and enforcing enrollment agreements and also provide checklists that schools can use when drafting their agreements. We encourage schools to attend this webinar so that they will learn about key provisions that should be included in the enrollment agreements, common enrollment agreement traps, how to handle online enrollment agreements, enforcement strategies, and more.

This brief video outlines how corporate governance works.

I rarely see private school enrollment agreements available online. Shouldn't this important document be available for parents to peruse and think about when deciding which private school to send their children to?

While the enrollment agreement is an important document for parents to carefully review, the agreement is also an important document for the schools to protect. Posting the document online could be risky, from a legal perspective, for the school. For example, a plaintiff’s attorney could try to use the agreement against the school. There may also be different agreements for different students, (e.g., an international student versus a domestic student or a day student versus a boarding student. Additionally, there may be a specific enrollment agreement for a specific family due to past issues with that family. The school may not want to publicly highlight these differences.

Should enrollment agreements ever be updated?

We advise clients to review enrollment agreements every few years after an initial comprehensive update of the enrollment agreement. There may be a few changes to consider each year, based on newly evolved best practices, but these changes are not necessarily substantial.

Questions? Contact us on Facebook. @privateschoolreview

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