Lachman v. Cabrillo Pacific University

California Court of Appeal Sep 18, 1981 No. Civ. 22652Published

Before: Staniforth

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Holding. The court held that the doctrine of exhaustion of administrative remedies does not apply to the plaintiffs' civil action for damages and injunctive relief because the relevant Education Code sections do not provide an administrative mechanism for adjudicating or awarding such damages.

Issues

Whether Education Code sections 94321 and 94332 require plaintiffs to exhaust administrative remedies before filing a civil action for damages and injunctive relief against an educational institution.

Disposition. reversed

Quotations verified verbatim against the opinion

“the plain explicit language of the statute indicates an intent that the right granted be adjudicated in a civil court rather than in an administrative hearing.”

“The Superintendent of Public Instruction has no authority whatsoever to award the damages that plaintiffs here seek.”

“The doctrine of exhaustion of administrative remedies is wholly inapplicable; here no effective administrative remedy is available.”

Opinion

STANIFORTH, J.

The multiple (16) plaintiffs’ (Privett) complaint alleged breach of contract and fraudulent misrepresentations made by the Cabrillo Pacific University (Cabrillo) by its agents to Privett and others as an inducement to enroll in the San Diego College of Business. The trial court sustained a general demurrer to Privett’s pleadings for the announced reason of failure to exhaust administrative remedies before filing this lawsuit. The trial court dismissed the action and this appeal followed.

Discussion

For the purposes of these proceedings we assume to be true the facts properly pleaded in plaintiffs’ complaint and amendments thereto. Privett and others sued Cabrillo, seeking injunctive relief and damages. The complaint alleged breach of contract, fraud, conspiracy to defraud, negligent misrepresentation, negligent hiring and a violation of Education Code section 94318, formerly section 29035, and sought rescission and restitution based on fraud, failure of consideration and mutual mistake of fact. The trial court sustained the demurrers and dismissed the proceeding based upon its interpretation of Education Code section 94332. The trial court held the sections provided an administrative remedy required to be exhausted before Privett was entitled to file this lawsuit.

The sole question presented by this appeal is whether Education Code sections 94321 and 94332 require these plaintiffs who seek money damages, and injunctive relief for fraud, and breach of contract against Cabrillo to “exhaust their administrative remedies” before commencement of their civil action against Cabrillo. Section 94321, subdivisions (a), (b), (c), (e) and (f), sets forth certain prohibited activities covering educational institutions. After an enumeration of the prohibited activities, section 94321 provides: “Any institution willfully violating any provisions of this section shall be unable to enforce any contract or agreement arising from the transaction in which the violation occurred, and it may be one of the grounds for losing the

approval

or authorization to operate in this state.

In addition, in the event of such violation, the institution shall refund to the student any tuition or fees that have

[944]

Lachman v. Cabrillo Pacific University

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STANIFORTH, J.

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