Hiatt v. Brigham Young University

Filing 31

MEMORANDUM DECISION AND ORDER DENYING DEFENDANT'S MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM -denying 21 Motion to Dismiss for Failure to State a Claim. See Order for details. Signed by Judge Ted Stewart on 1/7/21. (jrj)

Case 1:20-cv-00100-TS-CMR Document 31 Filed 01/07/21 PageID.255 Page 1 of 12

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH
CENTRAL DIVISION

CHASE HIATT,
MEMORANDUM DECISION AND
ORDER DENYING
DEFENDANT’S MOTION TO
DISMISS FOR FAILURE TO
STATE A CLAIM

Plaintiff,
v.
BRIGHAM YOUNG UNIVERSITY,
Defendant.

Case No. 1:20-CV-00100-TS
Judge Ted Stewart

This matter is before the Court on Defendant Brigham Young University’s (“BYU”)
motion to dismiss (“Motion”), which asks the Court to dismiss this matter for failure to state a
claim. For the following reasons, the Court denies the Motion.
I.

BACKGROUND

Coronavirus Disease 2019 (“COVID-19”) is a deadly, novel coronavirus that was
discovered in late 2019 and spread very quickly in the first months of 2020. COVID-19 caused a
global pandemic that has affected all facets of regular life. As one example, in and around March
2020 many universities in the United States, including BYU, adjusted the ways they conducted
classes and other campus activities to prevent the spread of COVID-19. 1 This included moving

1

See Docket No. 2 ¶¶ 21–24.
1

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most or all in-person classes to an online format and closing or cancelling many on-campus
facilities and services. 2 These changes set the stage for Plaintiff’s claims.
Plaintiff was an undergraduate student at BYU during the relevant semesters, 3 and his
Complaint presents a proposed class action on behalf of himself and BYU students who paid
tuition for any semester or term affected by COVID-19. 4 Undergraduate students at BYU paid
between $2,895 and $5,970 in tuition,5 and graduate students paid between $430 to $860 per
credit hour in tuition for the Winter 2020 semester. 6 The students also paid mandatory fees in
addition to their tuition.7 According to the Complaint, BYU “agreed to . . . provide an in-person
and on-campus live education as well as the services and facilities to which the Mandatory fees
they paid pertained” in return. 8 Plaintiff supports this alleged agreement by referencing BYU’s
website, promotional materials, and acceptance letters that market and promote the in-person
education and campus services BYU provides. 9 Then, during the Winter 2020 semester, BYU
unexpectedly changed its in-person classes to online classes and stopped providing many oncampus services to prevent the spread of COVID-19. 10 Despite these changes, BYU has not
refunded any part of the tuition or mandatory fees it assessed for the Winter semester or any

2

Id.

3

Id. ¶ 10.

4

Id. ¶ 3.

5

Id. ¶ 2.

6

Id. ¶ 19.

7

Id. ¶ 2.

8

Id. ¶ 50.

9

Id. ¶¶ 52–55.

10

Id. ¶¶ 3–4.
2

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other semester affected by COVID-19. 11 Plaintiff brought this Complaint against BYU for
breach of contract and, in the alternative, unjust enrichment because of the changes BYU made
due to COVID-19. 12 Now, with this Motion, BYU challenges the entire Complaint for failure to
state a claim. 13
II.

STANDARD OF REVIEW

A court may dismiss a complaint when it fails to state a claim upon which relief can be
granted. 14 “To survive a motion to dismiss, a complaint must contain sufficient factual matter,
accepted as true, to state a claim to relief that is plausible on its face.” 15 Legal conclusions alone
are not sufficient. 16 When reviewing a motion to dismiss, a court must assume all the facts
alleged in the complaint are true. 17 The court must also limit its review to the four corners of the
Complaint and documents incorporated by reference in the Complaint. 18
III.

ANALYSIS

BYU seeks dismissal on Plaintiff’s breach of contract and unjust enrichment claims. Both
of the claims are governed under Utah law, as detailed below.

11

See generally id.

12

Id. ¶¶ 10, 38, 48–70.

13

Docket No. 21, at 1.

14

Hall v. Bellmon, 935 F.2d 1106, 1109 (10th Cir. 1991).

15

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation and internal quotation marks

omitted).
16

Id. at 679 (“While legal conclusions can provide the framework of a complaint, they
must be supported by factual allegations.”).
17

Hall, 935 F.2d at 1109.

18

Smith v. United States, 561 F.3d 1090, 1098 (10th Cir. 2009); Mobley v. McCormick,
40 F.3d 337, 340 (10th Cir. 1994).
3

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A. BREACH OF CONTRACT
In its Motion, BYU argues that Plaintiff’s breach of contract claim should be dismissed
for two reasons. First, BYU argues there is no contract term requiring BYU to provide in-person
education and campus services, so BYU did not breach the contract. Second, BYU argues that
even if the contract does contain a term requiring BYU to provide in-person education and
services, BYU is excused because it would be impracticable to provide in-person education and
services during a global pandemic. Each of these arguments will be addressed individually.
1. Prima Facie Case
In Utah, the necessary elements of a breach of contract claim are “(1) a contract, (2)
performance by the party seeking recovery, (3) breach of the contract by the other party, and (4)
damages.” 19 While BYU admits, for the purposes of its Motion, that Plaintiff sufficiently alleges
the existence of a contract, the parties do not agree about the terms of the contract. BYU argues
that it did not agree to provide in-person instruction or on-campus services and therefore did not
breach the agreement. But Plaintiff argues that BYU’s website, promotional materials, and his
acceptance letter establish a contract in which BYU agreed to provide in-person education and
on-campus services, and BYU did breach this agreement. Thus, the relevant question is whether
Plaintiff, in the Complaint, sufficiently alleges a contract in which BYU agreed to provide inperson instruction and on-campus services.
As an initial matter, the Court will address BYU’s argument that there is no contract
requiring BYU to provide in-person education and services. Importantly, “a court should
consider no evidence beyond the pleadings on a Rule 12(b)(6) motion to dismiss” except for
“documents referred to in the complaint if the documents are central to the plaintiff’s claim and

19

Am. W. Bank Members, L.C. v. State, 2014 UT 49 ¶ 15, 342 P.3d 224.
4

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the parties do not dispute the documents’ authenticity.” 20 BYU supports its argument with two
documents: the Financial Responsibility Declaration and BYU’s catalog. Plaintiff does not
explicitly reference either of these documents in the Complaint, but Plaintiff does broadly refer
to the BYU website. Though these documents are not listed by name in the Complaint, they can
be found on the BYU website. Thus, it is not clear whether the Financial Responsibility
Declaration and the catalog are referred to in the Complaint or central to Plaintiff’s claim, but
Plaintiff does not dispute their authenticity. Plaintiff also does not argue that these documents
should not be considered. In an attempt to give BYU every allowance supported by law, the
Court will consider these documents.
The two documents BYU submitted do not support dismissal. First, the Financial
Responsibility Declaration states “I understand that when I register for any class or receive any
service from BYU I accept full responsibility to pay all tuition, fees, and other associated costs
assessed as a result of my registration and/or receipt of services.” 21 While this declaration does
not explicitly require BYU to provide in-person learning, it does not conflict with Plaintiff’s
claim. Further, BYU’s argument that its obligation to Plaintiff is complete when he registers for
classes or receives any service defies logic. Under this interpretation, BYU would be permitted
to require full tuition payment for the mere privilege of registration without providing any type
of instruction. Such a reading of the Financial Responsibility Declaration is untenable and
inconsistent with the relationship between a university and its students. While BYU is correct
that nothing in this declaration requires in-person instruction, it surely suggests that BYU owes
more to its students than simply allowing them to register or receive some modicum of services.
20

Alvarado v. KOB-TV, L.L.C., 493 F.3d 1210, 1215 (10th Cir. 2007) (quoting Jacobsen
v. Deseret Book Co., 287 F.3d 936, 941 (10th Cir. 2002)).
21

Docket No. 21-1, at 5.
5

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Next, BYU points to a disclaimer in its catalog, which states
The university makes every reasonable effort to provide accurate information in the
contents of this catalog but reserves the right to make changes at any time without
prior notice. The university reserves the right to change or discontinue graduation
requirements, department majors, individual courses, instructors, and all other
aspects of university operations. In the event the university determines to make
changes in curriculum, it will post these changes as soon as practical within this
online catalog. It is recommended that students regularly check this catalog for
possible changes. 22
In the employment context, courts have held that a clear and conspicuous waiver may
prevent the creation of an implied-in-fact contract. 23 “The prominence of the text, the placement
of the disclaimer, and the language of the disclaimer are all relevant factors in determining
whether a disclaimer is clear and conspicuous.” 24 Here, there is insufficient information for the
Court to determine whether this disclaimer bars Plaintiff’s claim as a matter of law.
BYU also argues that the Court should not interfere with BYU’s academic decisions. 25
BYU cites to several cases in which courts have declined to interfere in academic decisions such
as academic dismissals. 26 However, Plaintiff is not asking the Court to interfere in BYU’s
academic or pedagogical choices by requiring BYU to provide in-person education or change its
methods of education. Rather, Plaintiff is asking for a refund of tuition and/or mandatory fees for

22

Docket No. 21, at 10.

23

Hodgson v. Bunzl Utah, Inc., 844 P.2d 331, 334 (Utah 1992).

24

Tomlinson v. NCR Corp., 2014 UT 55 ¶ 24, 345 P.3d 523.

25

Docket No. 21, at 10–11.

26

See Bd. of Curators of Univ. of Mo. v. Horowitz, 435 U.S. 78, 90 (1978) (declining to
interfere in the decision to dismiss a student); Gaspar v. Bruton, 513 F.2d 843, 850 (10th Cir.
1975) (declining to interfere in the decision to dismiss a student); Assenov v. Univ. of Utah, 553
F. Supp. 2d 1319, 1328 (D. Utah 2008) (declining to interfere in the decision to dismiss a
student); Axson-Flynn v. Johnson, 356 F.3d 1277, 1292 n.14 (10th Cir. 2004) (citing cases in
which the Supreme Court has declined to interfere in academic dismissals, expulsions, discipline,
and uniform requirements).
6

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the breach of contract alleged. The requested relief does not require the Court to ask BYU to
change its operations or otherwise interfere in BYU’s academic decisions, so this argument does
not support granting the Motion.
Next, the Court will address whether Plaintiff sufficiently alleges a contract in which
BYU agreed to provide in-person instruction and on-campus services. Under Utah law, a
contract can consist of an express contract or an implied-in-fact contract. 27 Contracts implied in
fact are “contracts established by conduct” and, like express contracts, “require a meeting of the
minds.” 28 Utah courts have not specifically addressed whether students can use a university’s
publications as evidence of an implied-in-fact contract, but they “have stated that an employee
may use an employer’s written policies, bulletins, or handbooks as evidence of an implied-in-fact
contract.” 29 The principle exists to “give effect to the intent of the parties,” which would apply to
other contracts, including student-university contracts. 30 Utah law also does not foreclose the
enforceability of an implied-in-fact contract when there is also an express contract between the
parties. 31
Though BYU argues that Plaintiff’s Complaint is lacking, Plaintiff sufficiently alleges
facts to support the breach of contract claim. First, Plaintiff supports the existence of a contract
with reference to BYU’s website, promotional and marketing materials, and Plaintiff’s

27

See Sachs v. Lesser, 2007 UT App 169 ¶ 16, 163 P.3d 662 (analyzing breach of
contract under an express contract and an implied in fact contract theory), rev’d on other grounds
by Sachs v. Lesser, 2008 UT 87, 207 P.3d 1215; Berube v. Fashion Ctr., Ltd., 771 P.2d 1033,
1044 (Utah 1989) (“An employee may demonstrate that his at-will termination breached an
express or implied agreement with the employer to terminate him for cause alone.”).
28

Jones v. Mackey Price Thompson & Ostler, 2015 UT 60 ¶ 44, 355 P.3d 1000.

29

Hodgson, 844 P.2d at 333.

30

Berube, 771 P.2d at 1044.

31

See Wood v. Utah Farm Bureau Ins., 2001 UT App 35 ¶ 14, 19 P.3d 392.
7

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acceptance letter. According to Plaintiff, BYU “promoted its in-person educational services as
being valuable to students’ educational experiences,” and impliedly promised these in-person
educational experiences, opportunities, and services in its acceptance letter to Plaintiff. While
Plaintiff could certainly do more to shore up these allegations, these are facts that could support
an enforceable implied-in-fact contract under Utah law with a term requiring BYU to provide inperson education and services. And an express agreement would not necessarily preclude the
enforceability of the alleged implied-in-fact contract. These facts support the first element for the
breach of contract claim.
The Complaint also alleges facts supporting the other three elements for a breach of
contract claim. According to the Complaint, BYU announced that it would cancel in-person
classes and begin offering all classes online on March 13, 2020. This is a breach of the alleged
agreement in which BYU agreed to provide in-person education and services. Next, the
Complaint states that Plaintiff performed his obligation by paying the tuition and fees. Finally,
the Complaint alleges that Plaintiff has damages from the breach of contract because he did not
receive the valuable education and other services for which he paid. Therefore, Plaintiff has
stated sufficient facts to satisfy the liberal requirements to plead a claim for breach of contract
under Rule 8(a).
2. Impracticability
Next, BYU argues the Court should grant its Motion because, even if it did breach the
contract, BYU is excused from this alleged obligation because it is impracticable for BYU to
provide in-person education and services during the COVID-19 pandemic. In Utah,
impracticability is a defense against a breach of contract claim. 32 “Dismissal of a claim under

32

See W. Props. v. S. Utah Aviation, Inc., 776 P.2d 656, 658 (Utah Ct. App. 1989).
8

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Rule 12(b)(6) on the basis of an affirmative defense . . . is proper where that defense is clear
from the face of the Complaint.” 33 Thus, the relevant question is whether BYU’s defense of
impracticability is clear from the face of Plaintiff’s Complaint.
“The doctrine of impracticability excuses a party’s performance ‘if an unforeseen event
occurs after formation of the contract and without fault of the obligated party, which event makes
performance of the obligation impossible or highly impracticable.’” 34 However, “a party may not
defend on grounds of impracticability when that party takes on the risk that a supervening event
will occur and render performance impracticable or impossible.” 35 BYU asks the Court to take
judicial notice of governmental orders related to COVID-19 and argues that the COVID-19
pandemic and the related governmental orders constitute the “unforeseen event” that made its
performance impracticable. And BYU argues that Plaintiff, not BYU, bore the risk of a
supervening event because of the language of the Financial Responsibility Declaration in which
Plaintiff agreed to “pay all tuition upon registration.” 36
Even if this Court took judicial notice of the governmental orders, the Court could not
grant the Motion on the impracticability defense. It is essential to know which party bears the
risk of the agreement before determining whether impracticability is a valid defense. BYU
argues that “the question [of who bears risk] is unequivocally answered in this case by the

33

VanLandingham v. Grand Junction Reg’l Airport Auth., 46 F. Supp. 3d 1119, 1124 (D.
Colo. 2014); see also Bullington v. United Air Lines, Inc., 186 F.3d 1301, 1310 n.3 (10th Cir.
1999) (overruled on other grounds).
34

Cent. Utah Water Conservancy Dist. v. Upper E. Union Irrigation Co., 2013 UT 67 ¶
28, 321 P.3d 1113 (quoting W. Props., 776 P.2d at 658).
35

Id.

36

Docket No. 29, at 12.
9

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financial responsibility declaration.” 37 But the language in the declaration does not
“unequivocally” answer which party bears the risk. It simply states that Plaintiff agreed to pay
tuition and fees at the time of registration or receipt of services—there is no mention of risk.
Moreover, the other facts Plaintiff references in the Complaint do not provide a clear answer to
whether Plaintiff or BYU would bear the risk either. Therefore, BYU’s defense is not clear on
the face of the Complaint. Further, even if it was impossible for BYU to provide in-person
education, BYU could still be required to provide restitution. 38 For these reasons, the Court will
not dismiss the breach of contract claim.
B. UNJUST ENRICHMENT
BYU also argues that Plaintiff’s unjust enrichment claim should be dismissed because the
contract between Plaintiff and BYU precludes the unjust enrichment claim. Rule 8 explicitly
states that complaints can include claims for “relief in the alternative,” 39 but “where an express
contract covering the subject matter of the litigation exists, recovery for unjust enrichment is not
available.” 40
While the Court agrees that Plaintiff cannot ultimately succeed on both the breach of
contract claim and the unjust enrichment claim, Plaintiff sufficiently alleges these two claims in
the alternative, and both claims can survive the Motion. Though some decisions in Utah courts
and in this district have granted motions to dismiss unjust enrichment claims under Utah law
because of the existence of a contract, those cases are distinguishable from this case.

37

Id.

38

Restatement (Second) of Contracts § 377 (Am. Law Inst. 1981).

39

Fed. R. Civ. P. 8(a)(3).

40

U.S. Fid. v. U.S. Sports Specialty, 2012 UT 3 ¶ 13, 270 P.3d 464 (quoting Selvig v.
Blockbuster Enters., LC, 2011 UT 39 ¶ 30, 266 P.3d 691).
10

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Specifically, those cases all had obvious, express, written contracts between the parties and no
dispute about the enforceability of those contracts. 41 But here, as mentioned previously,
Plaintiff’s Complaint does not necessarily allege an express contract. One of the questions
presented by the Complaint is whether there is an enforceable contract between the parties. The
facts and evidence may establish an express contract, an implied-in-fact contract, or no
enforceable contract between the parties. Thus, the unjust enrichment claim is not precluded at
this stage.
In addition, the Complaint sufficiently alleges facts supporting all of the necessary
elements of an unjust enrichment claim. In Utah, the elements of an unjust enrichment claim are
“(1) a benefit conferred on one person by another; (2) an appreciation or knowledge by the
conferee of the benefit; and (3) the acceptance or retention by the conferee of the benefit under
such circumstances as to make it inequitable for the conferee to retain the benefit without
payment of its value.” 42 Plaintiff alleges that he conferred a benefit on BYU when he paid tuition
and mandatory fees for the relevant semesters and terms. BYU knew about the benefit and
allowed Plaintiff to register for classes and receive campus services. BYU then retained the full
tuition and mandatory fees after BYU cancelled in-person classes and campus services, which is
allegedly inequitable because Plaintiff did not receive the valuable in-person education or the

41

Id. at ¶ 14 (dismissing an unjust enrichment claim when there is a written insurance
policy); Wilcox v. Career Step, No. 2:08-CV-998-CW, 2010 WL 624863, at *6 (D. Utah Feb. 19,
2010) (unpublished) (dismissing an unjust enrichment claim where the complaint alleged an
express, written contract for the work plaintiff did); Anapoell v. Am. Express Bus. Fin. Corp.,
No. 2:07-CV-198-TC, 2007 WL 4270548, at *5–*6 (D. Utah Nov. 30, 2007) (unpublished)
(dismissing an unjust enrichment claim when there was a written lease agreement).
42

Rawlings v. Rawlings, 2010 UT 52 ¶ 29, 240 P.3d 754 (internal citation and quotation
marks omitted).
11

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services and facilities for which he paid. Therefore, the Court will not dismiss the unjust
enrichment claim.
IV.

CONCLUSION

It is therefore
ORDERED that Defendant’s Motion to Dismiss for Failure to State a Claim (Docket No.
21) is DENIED.
DATED January 7, 2021.
BY THE COURT:

________________________________________
TED STEWART
United States District Judge

12