Shan't pay, won't pay…

Pursuing parents for unpaid fees can be a fraught process, reports Tabitha Cave

A N Parent says: "We do not consider that we are liable to pay fees in lieu of notice because the school breached the contract in failing to make Britney use a fountain pen at school, therefore depriving her of the opportunity to be national handwriting champion."

This is an extreme example of the type of creative argument used by parents to try to avoid payment of outstanding fees, but nevertheless it is a real-life case and one which required careful consideration by the school in question.
There has been a one-third increase in the number of new instructions from schools for fee recovery specialists. In addition, there has been a significant increase in the number of those claims that are defended, and more creativity in the reasons given in defence of claims for unpaid fees. While such defences may often be spurious or even vexatious, they nonetheless need to be considered carefully by those in charge of financial management within the school.

Gone are the days when a parent whose child attended the school admits liability to pay fees for the period that the child attended, let alone for fees in lieu of notice (a term's fees being the sector standard) if insufficient notice is given of a pupil's withdrawal.

What you’re up against
Arguments against paying outstanding fees run from "I can't afford to pay" which, incidentally, is no defence to the school's claim but may cause the school to question whether it is worth issuing proceedings to attempt to recover the debt, to the legalistic: the school breached its contractual or statutory obligations in some way. For example, it breached the Data Protection Act or mis-sold fee protection insurance, or the terms of the contract itself were unfair.
Parents have used a broad raft of defences, ranging from those possibly valid issues of failure to educate or failure to protect a child from bullying to the frankly ridiculous, such as "the school's bollards damaged the mother's car" (only when she drove into them, of course!).

Face up to the allegations
No matter how tempting it may be to ignore such allegations, particularly those which obviously lack merit and to progress a claim through the courts, it is recommended otherwise. Many seemingly ridiculous defences could conceivably give rise to a valid defence if the circumstances alleged are proven – if they are deemed to be sufficiently serious to give rise to a fundamental breach of the contract for educational services – and the Courts will generally allow parents to pursue such defences.

It should always be borne in mind that, when pursuing a fees claim, it is the school's obligation, as claimant, to prove its case and its contractual entitlement to the unpaid fees, and the allegations raised by the parent will therefore need to be dealt with by adducing evidence. This can be costly in terms of time (often involving personnel across the school) and legal fees, quite apart from the emotional energy involved.

A balanced view
Schools should balance their wish to pursue outstanding fees with their prospects of success on each fees claim, factoring in the availability of key personnel to give evidence, and give proper consideration of the costs involved to make a commercial decision about whether to pursue the debt. Schools should also consider other generic factors such as the number of related debtors, the reputational risk to the school of pursuing the debt to trial and the need to send a strong message to the parent cohort that the school will not give in to spurious allegations, and is prepared to fight its corner.

Be aware that defences to fees claims can be raised by parents at any time – on receipt of invoices or chasers, or following formal letters before action sent by solicitors on the school's behalf, or in response to the service of court proceedings or even after judgement has been entered in the school's favour – typically, in support of an application to set that judgement aside. Unfortunately, the parents can pursue that defence even if they had sent a complimentary letter to the school when the child was withdrawn and the defence is only raised for the first time after litigation has been commenced.

Regardless of when the defence is raised, if it is in the form of a complaint, the school will need to consider whether or not the concerns raised should be dealt with under the school's complaints procedure. Complaints procedures do not necessarily apply to former pupils of the school or to their parents, but your own procedure may do so. If the complaints are raised formally, in writing, it is usual for a school's procedure to require any investigation to be carried out by a senior member of staff.

If the nature of the defence is such as to raise an issue which triggers the complaints procedure, this should be exhausted before litigation is commenced. The Civil Procedure Rules, which govern the behaviour of the parties to legal proceedings conducted in the civil courts, expect the school to respond to the defence before issuing court proceedings and failure to do so could give rise to penalties to the school in terms of time and costs.

Finally, once concerns are raised, it makes sense to deal with them rather than ignore them. A failure to deal appropriately with complaints made by parents in defence to a request for a payment of fees can be of itself a breach of the school's terms and conditions. This may result in a claim by parents seeking a refund of fees paid, which the school will be required to defend and possibly to counterclaim for unpaid fees, placing it on the defensive from the outset.

Tabitha Cave is a partner in the Commercial Litigation Department at Veale Wasbrough Lawyers. Tabitha can be contacted at tcave@vwl.co.uk or on 0117 9314 5381.

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