Moran vs. Uni. Coll. Salford (2) 1993 (original) (raw)
Court of Appeal
MORAN vs. UNIVERSITY COLLEGE SALFORD (2)
[1994] ELR 187
HEARING DATE 12 November 1993
University admissions procedures - Polytechnics' Central Admissions System - Unconditional offer given to plaintiff as a result of a clerical error - Intention to create legal relations - Binding agreement - Consideration - Detriment - Estoppel by convention - Exercise of discretion to grant mandatory injunction at interlocutory stage
HEADNOTE
M, aged 34, was employed by the Manpower Services Commission. He wished to obtain a qualification as a physiotherapist. He applied for degree courses in physiotherapy at four polytechnics, including University College Salford ('UCS'). These applications were made through the Polytechnics' Central Admissions System ('PCAS'), for a fee of �7. Applications to five other institutions were made through the Universities' Central Council for Admissions ('UCCA'). Having been made after the closing date of 15 December 1992, M's application was 'late'. Therefore, the institutions had a discretion whether to consider the application or not, subject to suitable vacancies remaining. All of the applications, except that at UCS, were rejected without interview. On 22 June 1993 M received from PCAS a 'statement of decision' indicating that he had received an unconditional offer from UCS. A leaflet accompanying the statement of decision explained that an unconditional offer meant that 'the institution is satisfied, from the information given, that you have fulfilled all its entrance requirements, and that it is prepared to admit you to the course'. M replied with a 'firm acceptance' of the offer from UCS. This meant that he was not eligible to seek an alternative place in 1993 through PCAS. In particular, it meant that he was not eligible to enter the 'clearing' process under which applicants who had received no offers, or had not satisfied the conditions of a conditional offer, could apply to be considered for any remaining suitable vacancies. PCAS acknowledged M's acceptance of the offer and requested him to complete a reply slip to confirm finally to UCS that he would be taking up the place. M signed the declaration in the reply slip and sent it to the college admissions officer at UCS. M gave notice to leave his accommodation in Lewisham and to terminate his employment. He did not attend a second interview for a job for which he had applied. On 16 August 1993 M telephoned S, the course leader at UCS, to request certain information. He was informed that he had never been offered a place on the course, and that there was no place for him. The course was funded by the Department of Health and the funding covered thirty-four places. S had made sufficient offers to be confident that the course would be full. M's application should have been rejected, but because of a clerical error he was made an unconditional offer. M sought: (i) specific performance of the agreement; (ii) a mandatory injunction compelling UCS to admit him onto the physiotherapy course in September 1993; and (iii) further, or alternatively, damages for breach of contract.
Held
Refusing to grant a mandatory injunction
(1) The unconditional offer apparently made by UCS of a place for M was on the face of it intended to create a legal relationship between the parties, and appeared to be an offer capable of acceptance. When M accepted it, at the latest when he notified UCS of his acceptance on 8 July 1993, there was a strong case for saying that an agreement was reached under which UCS agreed to offer him a place if he sought to enrol on the due date. However, M would not have been bound to enrol or to pay fees until he did enrol. He was entitled to withdraw completely from the scheme, and to give up any place he was holding, up to 30 September 1993. If he had enrolled, he would then have been bound by a separate contract to pay fees.
Orphanos v Queen Mary College distinguished.
(2) By accepting the unconditional offer M gave up the chance, however small, which entry into clearing would have offered. This was a sufficient detriment to provide consideration for the agreement.
(3) Given this conclusion, there was no need to decide the arguments on 'estoppel by convention'.
(4) In the exercise of the court's discretion, a mandatory injunction would not be issued at the interlocutory stage.
CASES REFERRED TO
Amalgamated Investment & Property Co (in liquidation) v Texas Commerce International Bank [1982] QB 84, [1981] 3 WLR 565, [1981] 3 All ER 577, CA
Central London Property Trust v High Trees House [1947] KB 130, [1956] 1 All ER 256
Combe v Combe [1951] 2 KB 215, [1951] 1 All ER 767, CA
Evenden v Guildford City Association Football Club [1975] l QB 917, [1975] 3 WLR 251, [1975] 3 All ER 269, CA
Films Rover International v Cannon Film Sales [1987] 1 WLR 670, [1986] 3 All ER 772
Kenny v Kelly [1988] IR 457
Leisure Data v Bell [1988] FSR 367, CA
Orphanos v Queen Mary College [1985] AC 761, [1985l 2 WLR 703, [1985] 2 All ER 233, T4L
Shephard Homes v Sandham [1971] Ch 340, [1970] 3 WLR 348, [1970] 3 All ER 402
Webb v Ireland [1988] IR 353
COUNSEL
Lord Campbell of Alloway QC and Nan Alban-Lloyd for the appellant
Joe Smouha for the respondent
PANEL: Glidewell, Evans and Waite LJJ
JUDGMENT BY GLIDEWELL LJ.
In this action, begun by writ issued on 27 September 1993, the plaintiff, Mr Moran, claims that on 29 June 1993 the respondent, University College, Salford ('UCS') entered into a written agreement with him to accept him for the degree course in physiotherapy for the year commencing September/October 1993, and that in breach of that agreement UCS has refused to accept him on the course. In his statement of claim Mr Moran claims, by way of relief:
(i) specific performance of the agreement;
(ii) a mandatory injunction compelling the defendant to admit the plaintiff upon the said course at its commencement on 28 September 1993;
(iii) further or alternatively, damages for breach of contract.
At the same time as they issued the writ, the plaintiff's solicitors also made an application, ex parte, for a mandatory order requiring UCS to admit Mr Moran to the BSc Physiotherapy course at its commencement on 28 September 1993.
Sedley J required that notice of the application should be given to the defendants, and the application came on for hearing before Mr Hugh Bennett QC sitting as a deputy judge of the High Court. After a 2-day hearing on 8 October 1993 he dismissed the application.
For reasons we do not know, the commencement of the course was delayed from 28 September to 11 October 1993. If the deputy judge had granted a mandatory order, Mr Moran could thus have joined the course from its inception.
The plaintiff applied to us for leave to appeal against that decision. In due course we granted leave, and have treated the hearing of the application as the hearing of the appeal.
I make two initial comments. The first is that the hearing of the application and the appeal were completed, and we announced our decision, within a month after the issue of the writ. The second comment is that if the court makes a mandatory order in the terms sought by Mr Moran, it will effectively be granting not merely interlocutory but permanent relief. By the time the full hearing comes on, Mr Moran will be many weeks if not months into the course.
At the conclusion of the hearing we announced that we should dismiss the appeal and give our reasons later. This we now do.
The facts
By the time the application came on for hearing before the deputy judge the plaintiff had sworn three affidavits. Five affidavits had been filed on behalf of UCS, four of which were sworn on either 29 or 30 September 1993. Inevitably they must have been sworn on hasty instructions. It is therefore not surprising that there are some questions which are not answered by the defendants' affidavits.
The majority of the facts found by the judge or disclosed by the affidavits are not in issue. The plaintiff, Mr Paul Moran, is 34 years of age; he will be 35 in November 1993. He is employed by the Manpower Services Commission. However, he wishes to obtain a qualification as a physiotherapist. Several universities or university colleges offer a degree course in physiotherapy, amongst them the respondent, UCS. Applications for admission to these courses are made through either of two bodies providing clearing systems - the Universities' Central Council for Admissions ('UCCA') and the Polytechnics' Central Admissions System ('PCAS'). We are told that for the future, the two bodies have been amalgamated.
In May 1993 Mr Moran applied for admission to courses leading to a degree in physiotherapy through PCAS at four institutions of which UCS was one. He also applied through UCCA to a further five institutions. Of these nine applications, all except the application for a place at UCS were rejected without him being called for an interview. We do not, however, know the reasons for any of these rejections.
An applicant for admission to one or more of the institutions in the PCAS system is required to pay a fee of �7 to PCAS. In return PCAS transmits his application to each of the institutions to which he applies, in due course informs him of the decision on each application, and (if he is made one or more offers of a place) transmits his response to the offers to the institutions.
I break off from the recital of facts to say that in my opinion, as a matter of law PCAS acts as agent both for the intending student and for each of the institutions to transmit this information from the one to the other, but is not authorised to enter into a contract on behalf of either the student or an institution with the other.
I return to the facts. When the student receives an application form from PCAS, he also receives the PCAS guide for applicants wishing to enter an institution in the autumn of 1993. This guide says, in relation to the date by which an application should be made:
'For entry in autumn in 1993 your application form should reach... PCAS between 1 September 1992 and is December 1992.'
If you are unable to apply between the above dates, you may still submit an application form which PCAS will process as detailed below:
'(a) Between 16 December 1992 and 26 May 1993 PCAS will despatch your application to the institutions listed on your form for consideration at their discretion, subject to suitable vacancies remaining.'
The guide also contains this passage which is relevant to any future contract between the student and an institution:
'Should you become a student at (an institution in PCAS) it will be a term of your contract with that institution that it will take all reasonable steps to provide the educational services described in its prospectus and other promotional material.'
Mr Moran completed a PCAS application form in accordance with the guide. He applied for a place on a physiotherapy course at four institutions of which UCS was the first. He wrote on the form details of the subjects in which he had passed examinations whilst at school in Ireland, together with the grades achieved. He sent this to PCAS, where it was received on 21 May 1993. His application was thus 'late'; the institutions had, in accordance with the guidance, a discretion whether to consider the application or not, subject to suitable vacancies remaining.
In response to his application Mr Moran received from PCAS their 'statement of decision' on Form PA4F which is dated 22 June 1993. The decision for Salford, his first choice, was 'U' meaning 'unconditional offer'. The other three were 'R' meaning 'rejection'. A pro forma letter to him from the chief executive of PCAS on the reverse of the document told him:
'You must now complete the boxes on the reply slip and return it to PCAS by the date printed on the reply slip...'
He also received a leaflet entitled 'Statement of decisions - 1993 entry'. This again was a detailed and comprehensive document, which introduced itself as follows:
'INTRODUCTION
1. This leaflet has been written to help you through the next stages of the PCAS procedures...
2. You have now received decisions from all your initial applications...
3. The first part of the leaflet explains how to fill in the reply slip, and the consequences of your replies.'
The effect of the unconditional offer which he had received from Salford was explained in para 7:
'What each type of offer means . . .
Unconditional offer
This means that the institution is satisfied, from the information given, that you have fulfilled all its entrance requirements, and that it is prepared to admit you to the course.'
Under the heading 'Your possible replies' the effect of a firm acceptance, which was the appellant's response to Salford, was described as follows:
'Firm acceptance (F)
If you firmly accept an offer, this means that you are sure that the offer is your first preference of all the offers you have received through PCAS. You can make this reply once only. You will not be able subsequently to change or cancel your reply. Your decision will have different effects according to the type of course and offers made.'
The PA4F reply slip was returned to PCAS on 29 June 1993, duly marked 'F' against the 'U' (unconditional offer) from Salford. The significance of this reply was described in the relevant section of the 'Statement of decisions':
'UF
35. If you firmly accept an unconditional offer (UF) for any course (degree Dip HE or HND) this means that you will definitely take up this course at this institution (subject to the result of applications outside the PCAS scheme). PCAS will acknowledge your reply, cancel all your other applications and tell the other institutions to which you have applied.
36. Your dealings with PCAS will now finish and your PCAS record will be closed. You will not be eligible to seek an alternative place this year through PCAS.
37. At a later date the institution will write to you about verification of your qualifications, registration for the course, accommodation, etc.
38 ...
39. The PCAS acknowledgement letter includes a reply slip. If, after making your decision, you decide not to take up the place, please return this slip to the institution. It is also helpful to the institutions if you use the slip to confirm nearer to enrolment, that you intend to take up the place.'
The 'statement of decisions' leaflet also contained a section headed 'Clearing'. It explained in paras 70 and 71 that this is the process by which, in late August/September 1993, applicants who had received no offers, or had not satisfied the conditions of a conditional offer, might apply to be 'considered for any remaining suitable vacancies'. An applicant was only eligible to enter clearing if he had not withdrawn from the PCAS scheme. As para 36 made clear, Mr Moran's acceptance of the unconditional offer meant that he was not eligible to seek an alternative place in 1993 through PCAS, and thus was not eligible to enter clearing.
On 6 July PCAS acknowledged Mr Moran's acceptance of the offer on form PA6. It said:
'...please complete the reply slip below and send it to the institution to confirm finally that you will be taking up the place reserved for you.'
The reply slip gave the name of Andrew Kemp, the college admissions officer, and his address at Salford. The appellant signed the declaration:
'I confirm that I will be taking up the unconditional offer of a place on the above course',
dated it 8 July 1993 and sent it to Mr Kemp.
On the following day PCAS sent to UCS a computer print-out which recorded Mr Moran's acceptance of an unconditional offer.
There, so far as the appellant was concerned, matters rested until 16 August 1993. Believing that he had a definite place on the Salford course, he gave notice to leave his accommodation in Lewisham and to terminate his employment with the Manpower Services Commission, and he did not attend a second interview for a job for which he had applied. Then, on 16 August 1993 he telephoned and spoke to Mr Simpson, a senior lecturer and the course Icader, in order to ask for some information which his bank manager required. Mr Simpson told him that he had never been offered a place on the course, and that there was no place for him.
In an affidavit sworn on 30 September 1993, Mr Simpson deposes that the BSc Physiotherapy degree course is the most popular course run by UCS. There were over 1200 applications for thirty-four places on the 1993 course. The course is funded by the Department of Health, which funding covers thirty-four places. Mr Simpson says that all candidates are told this fact.
Mr Simpson's affidavit continues:
'By 2 April 1993, which was the end of the spring term, I had already made forty-six offers, thirty-two of them conditional, in respect of the thirty-four places available. In addition, I had a priority listing of reserve candidates who would be the first to be approached if vacancies developed. All applicants to whom a place offer was made had been previously interviewed.
After Easter 1993, all "late" applications received were rejected automatically by me. Out of courtesy to students applying I did review such applications but the reality was that by this time there were simply no places available. The application made by Mr Moran was a "late" application. My recollection is that "late" applications were returned to the admissions unit in a batch indicating that they were to be rejected.'
He goes on to say that he certainly did not indicate that an offer was to be made to Mr Moran.
When Mr Simpson says that after Easter 1993 'there were simply no places available', this in one sense cannot strictly be accurate since it could not be known how many of those applicants to whom conditional offers had been made would achieve examination results which would satisfy the conditions - that would not be known until the results were published in August 1993. But in my view Mr Simpson must be understood as meaning that having made altogether thirty-two conditional offers in addition to fourteen unconditional offers, he was quite confident that sufficient people would satisfy the conditions, or there would be on his reserve list other persons who would satisfy the same conditions, to mean that from those who had made applications in time the course would be filled. He does not in his affidavit depose that it was in fact so filled, but I think it only right to infer that this was the situation. In a letter to which I shall refer later, other members of the UCS staff said that the course was full.
Mr Simpson deposes that on Sunday, 11 July 1993 he was admitted to hospital for surgery. He did not return to his office until late July 1993. Whilst he was away, the admissions department had received the computer print-out from PCAS dated 9 July 1993 to which I have referred, and presumably Mr Kemp had received the confirmation from Mr Moran that he was accepting the offer on Form PA6 dated 8 July 1993. Mr Simpson says that neither piece of information came to his attention when he returned to work, and he did not know that Mr Moran was saying that he had been offered a place on the course until 16 August 1993 when he spoke to Mr Moran on the telephone.
There is one paragraph in Mr Simpson's affidavit which is controversial. In the last paragraph, he deposes:
'I have reviewed the application submitted by Mr Moran. Even if he had submitted his application at a "non-late" stage he would not have qualified for an interview. There have been many applications from candidates of a higher quality which sadly I have had to reject.'
Mr Moran then received a letter dated 17 August 1993 from Mr Kemp, the college admissions officer. This read:
'I write to inform you that unfortunately, as you have not returned your PA6 form to Salford admissions within 7 days of receipt of our offer, your place on BSc (Hons) Physiotherapy has been withdrawn from 1993 entry. I believe you also had this indicated to you in a telephone conversation with the course leader, Mr Simpson.'
There are two allegations in this brief letter which are incorrect. Mr Moran had returned his PA6 form immediately and in time, well within, 7 days, and Mr Simpson had not told him anything about non-receipt of his PA6 form in time. Moreover, the explanation given by Mr Kemp in his affidavit for the first incorrect statement is itself insufficient. He says that he wrote the letter on the advice of the deputy chief executive of PCAS, but of course that person did not know how quickly Mr Moran had returned his PA6 form, since it was returned to Mr Kemp himself. These blatant errors in the handling of Mr Moran's complaint are most unfortunate and I have no doubt have played a part in the initiation and continuance of these proceedings.
Mr Moran then sought the assistance of the North Lewisham Law Centre, who on 1 September 1993 wrote to Mr Kemp a wholly accurate and admirable letter, setting out Mr Moran's complaint in detail. The letter concluded:
'We have advised our client that you entered into a binding contract with our client the moment he firmly accepted your offer. Can you please confirm that you will honour this contract and that our client will be able to enrol at your college on 7 September 1993 for the above-mentioned course.'
In reply, in a letter dated 3 September 1993, Mr Kemp said that the course was full before Mr Moran's application and no offer should have been made; that unfortunately an offer was indicated as a result of a clerical error; and that if Mr Moran had accepted the information given to him on 16 August 1993 by Mr Simpson it would still have been possible for him to enter clearing 'had you accepted the fact that no place was available'. By a further letter dated 15 September 1993, Dr Lucas, the head of centre, repeated the information that the course was already full and that there had been a clerical error. He informed Mr Moran that there were still one or two vacancies on an alternative course which he described as 'a cognate discipline to physiotherapy', and asked if Mr Moran was interested in applying for that course. Mr Moran was not.
The 'clerical error' to which these letters referred was on the form on which UCS indicated its decision on Mr Moran's application to PCAS. This form could be completed by filling in one of three boxes, two of which indicated 'reject' or 'unconditional'. Whoever completed the form filled in the box marked 'unconditional', and this carried through thereafter throughout the process. I should say that the form also has on it in manuscript the words 'reject by', but we have no evidence who wrote these words or what their significance is.
The issues
As an alternative to the allegation in the statement of claim that UCS had entered into an agreement with the plaintiff to enrol him on the physiotherapy course, by amendment there was added a further claim based upon what is said to be the 'equitable doctrine of promissory estoppel'. The issues for the deputy judge, and for this court, can therefore be summarised as follows:
(1) Was a legally binding agreement made between Mr Moran and UCS as pleaded? If not,
(2) On the facts disclosed, is UCS estopped from denying that it offered Mr Moran a place on the physiotherapy course, and if so does this give him a cause of action?
(3) If Mr Moran is likely to succeed on either issue 1 or issue 2 should a mandatory injunction be granted at this stage?
The proper approach
This is an appeal relating to an interlocutory application for a mandatory order. In his judgment, the deputy judge, after discussion of several recent authorities, adopted the principles which are derived from the judgments in this court of Dillon and Neill LJJ in Leisure Data v Bell [1988] FSR 367. He quoted passages from the relevant parts of both judgments. He also referred to the judgment of Hoffmann J in Films Rover International v Cannon Film Sales [1986] 3 All ER 772. He concluded that if there was a divergence between the views expressed in Leisure Data v Bell and those of Hoffmann J, the judgments in the Court of Appeal must prevail, but he also took the view that there was no such divergence. In my judgment, the deputy judge was entirely correct to base himself on the judgments in Leisure Data v Bell.
In short, the proper approach for the court in this case was to apply the following tests:
(1) 'The case must he unusually strong and clear before a mandatory injunction were to be granted, even if it is sought to enforce a contractual obligation... The court must feel a high degree of assurance that at the trial it will appear that the injunction was rightly granted; and this is a higher standard than is required for a prohibitory injunction': see the judgment of Megarry J in Shephard Homes v Sandham [1971] Ch 340 at pp 349 and 351, cited with approval by the Court of Appeal in Leisure Data v Bell.
(2) If so, should such an order be made on the interlocutory application in the interests of justice?
In answering this question, it must in particular be borne in mind that in the present case the grant of the order would be equivalent to making an order for specific performance of the alleged contract.
Conclusion
1. Was there a legally binding agreement between the parties?
Mr Moran's case is that he received through PCAS the unconditional offer of a place on the physiotherapy course at UCS, which he accepted by completing the reply slip PA4F, by inserting the letter 'F' for 'firm acceptance', with his signature and the date 26 June 1993, and returning the slip to PCAS, who in turn informed UCS of his acceptance.
Moreover, he further indicated his acceptance by signing the reply slip PA6 and sending it to Mr Kemp at UCS on 8 July 1993. Thus an agreement was reached not later than the second of these dates.
Mr Smouha, for UCS, submits that no binding agreement was made. Properly analysed, UCS did not make an offer of a place on the course; it issued a mere invitation to Mr Moran to enter into discussions which might lead to an agreement to accept him on the course and provide him with appropriate instruction, in return for his promise to arrange for his fees to be paid. It was not intended that any contract would come into existence until the student enrolled and agreed to pay the fees. Moreover, there was no consideration to support such an earlier agreement as is alleged. These were the arguments which persuaded the deputy judge to conclude that there was no binding agreement.
Mr Smouha relies in particular; on passages in the judgments in this court and the speeches in the House of Lords in Orphanos v Queen Mary College [1985] AC 761. In that case the issue was whether Mr Orphanos could reclaim fees paid to the college calculated on the basis that he was an overseas student, when he should have been treated as a home student. He was offered a place in March 1982, but given the opportunity to contend that he should only pay fees on the home student basis. However, when he enrolled in October 1982 he agreed to pay fees at the higher overseas' student rate.
Griffiths LJ said at page 2 of the transcript of his judgment:
'Against this background I turn to the first issue raised in the appeal: what was the contractual term entered into between the parties in 1982 relating to the payment of fees?'
He referred to the letter of 3 March 1982 in which the college had offered Mr Orphanos a conditional place, and continued:
'Although the letter speaks of a firm acceptance of an offer, at this stage of the relationship neither party was bound to the other because, as yet, the vital question of fees had not been settled between them. If Mr Orphanos had accepted the offer of a place in the belief that he would be classified as a home student, he could not have been held to that acceptance if his classification turned out to be an overseas student with fees that he could not afford. It was conceded by Queen Mary College that Mr Orphanos was not irrevocably contractually bound until he enrolled for the first session in October 1982.'
May LJ agreed, as did the House of Lords - see in particular the speech of Lord Fraser at page 76, where he said:
'I agree with [Griffiths LJ] that, as the college conceded, the contract was not concluded until Mr Orphanos enrolled at the college in October 1982 for the first session of his 3-year course.'
The issue in that case was, when was Mr Orphanos committed by contract to pay fees at the higher rate? The answer reached was, when he enrolled in October 1982. But the question whether the college had earlier committed itself to honour its offer of a place was not in issue. Moreover it is not strictly correct to say, as Lord Fraser did, that the college 'conceded that the contract was not concluded until Mr Orphanos enrolled at the college in October 1982...' The concession was that Mr Orphanos was not contractually bound until he enrolled. What was in issue was when was he bound to pay the fees? The question which arises in the present case, namely, whether the college was bound to honour the offer of a place which it made to him in March 1982 (provided he satisfied the academic condition) did not arise in that case. Thus in my judgment the decision is not relevant to the issue which we have to determine on this appeal.
The unconditional offer apparently made by UCS of a place for Mr Moran on the physiotherapy course was on the face of it intended to create a legal relationship between the parties, and appeared to be an offer capable of acceptance. When Mr Moran accepted it, at the latest when he notified UCS of his acceptance on 8 July 1993, there is a strong case for saying that an agreement was reached under which UCS agreed to offer him a place if he sought to enrol on the due date. However, Mr Moran would not have been bound to enrol or to pay fees until he did enrol. Under the specific terms of the PCAS 'statement of decisions' leaflet, he was entitled to withdraw completely from the scheme, and to give up any place he was holding, up to 30 September 1993. If he had enrolled, he would then have been bound by a further separate contract to pay fees. I therefore conclude that there is a strong case for saying that there was a binding agreement under which UCS committed itself to accept Mr Moran for the physiotherapy course.
2. Was there consideration for that promise from UCS in the sense of a detriment suffered by Mr Moran arising out of the agreement?
The deputy judge concluded that there was not. What appears to have been argued at that stage was that there was consideration in Mr Moran being bound by that agreement to pay the fees - I have already made it clear that in my view he was not. Alternatively, it was argued that the detriment Mr Moran suffered by giving up his job and his flat amounted to consideration. However these were not directly related to the agreement, though they arose indirectly out of it. It is thus not surprising that the deputy judge rejected these submissions.
Before us, a more sophisticated submission was advanced. It was that by accepting the unconditional offer, Mr Moran finished his dealings with PCAS, and in particular ceased to be eligible to seek an alternative place through clearing. Thus he gave up the chance, however small, which entry into clearing would offer. That was a detriment which provided consideration for the agreement.
Mr Smouha, in reply, argued that Mr Moran could have sought to rejoin clearing when he spoke to Mr Simpson on 16 August 1993 and was told that there was no place for him. But in my view this is not so. At that stage he was not told the reason why there was no place, and he only learned the correct reason when he received the letter from Mr Kemp of 3 September 1993. By then it was too late - the clearing was almost, if not quite, concluded. In any case, in my view this would go to mitigation rather than destroy this element as consideration.
I therefore conclude that there is a strong and clear case, on which Mr Moran has a good chance of success, that in late June/early July 1993 the parties reached a binding agreement, for good consideration, that UCS would accept Mr Moran for the degree course in physiotherapy commencing in September/October 1993.
3. Does Mr Moran have a cause of action based on estoppel?
In his submission to us, Lord Campbell for Mr Moran bases this part of his case on the type of estoppel sometimes called 'estoppel by convention'. Since I have concluded that Mr Moran has a 'strong and clear' argument that UCS entered into a binding agreement with him, I do not need to consider the arguments on estoppel. However, my first reaction to these arguments is that they are appreciably less likely to found a right of action for Mr Moran than is the argument based on contract.
4. Should an interlocutory mandatory injunction be granted?
The deputy judge, having decided that there was no contract and no right of action based on estoppel, was not required to answer this question. Since I disagree with him on the first of these issues, and conclude that there is a strong case for holding that there was a binding agreement between the parties, I must decide whether an interlocutory mandatory injunction should be granted. Clearly this is a matter for our discretion.
On the one side, on the evidence, Mr Moran was clearly misled into believing that there was a place on the course available to him. As a result, he abandoned his chance (which may not have been great) of obtaining another offer at the clearing stage, he gave up his job (though he has succeeded in retaining it temporarily), and he gave notice of his intention to leave his flat. If in the end he succeeds in this action, he will at least be entitled to some damages. Lord Campbell argues that damages will be so difficult to quantify or prove that this remedy will be useless. I am not wholly persuaded by this argument; I can see no reason why Mr Moran should have greater difficulty in proving his damages than do many other plaintiffs.
On the other side, if UCS were bound by an agreement to make available to Mr Moran a place on the course, that agreement arose out of a simple clerical error by a member of its staff. That error in legal phraseology was a mistake which was unilateral, and thus does not vitiate the agreement. Nevertheless it is very relevant to the question, is it just to compel UCS to provide a place on the course?
Moreover, we have the evidence on behalf of UCS that forty-six places were offered, although the course is restricted to the number of thirty-four for which the regional health authority provides funding. I discount the possibility which was canvassed before us that the regional health authority might increase the number in order to accommodate Mr Moran. I see no reason why they should do so.
Clearly there were more than enough applicants with satisfactory qualifications to fill the course. This contrasts with the evidence, controversial but unchallenged, from Mr Simpson that if Mr Moran had submitted his application before 15 December 1992, he would not even have qualified for an interview, presumably because his academic record was not good enough. So the effect of a mandatory order would be to require UCS to increase the size of the course by one (which might be inconvenient but would probably not be impossible) having already refused many applicants with far better qualifications.
Taking all these matters into account, I am clearly of the view that it would be wrong to grant a mandatory order at this interlocutory stage. Indeed, in my judgment the grant of such an order might very well create injustice. It is for these reasons that I concluded that the appeal should be dismissed.
JUDGMENT BY EVANS LJ
The respondents, University College Salford, provide a physiotherapy course which is funded by the North Western Regional Health Authority of the NHS. The funding agreement provides for thirty-four student places but there is provision for this number to be varied by agreement, up or down. The appellant applied for a place on the 1993 course. He did so through PCAS (the Polytechnics' Central Admissions System) which is the central clearing house with whom the respondents deal for this purpose. PCAS is distinct from UCCA, at least as regards the academic year 1993/94, although they share certain computer facilities which enables some cross-referencing to be made.
A would-be student pays a �7 fee to PCAS and in return he receives the benefits of a clearing system which involved the new universities established by the Higher and Further Education Act 1992, including the respondents. The PCAS Guide for applicants is distributed free of charge. It is a comprehensive document which includes detailed instructions for completing the application form.
The history of dealings between the appellant, PCAS and the respondents is set out in Glidewell LJ's judgment, and I gratefully adopt his statement of the facts. I should also refer to the PCAS operations manual, a substantial (forty pages) booklet which contains a detailed account of the PCAS scheme. This was supplied by PCAS to the institutions, but not to applicants. The appellant therefore did not see it, and in my judgment its terms cannot form part of any contract between him and the respondents. The terms are relevant, however, to the scope of PCAS's authority to act as agent for the respondents, and in a general sense, since they reflect the operation of the PCAS scheme to which the appellant subscribed, they do to that extent form part of the relevant 'matrix' of facts when considering the relationship between them.
Was there a contract?
It cannot be disputed that there was an agreement between the appellant and the respondents, formed through the agency of PCAS. The appellant invited the offer of a place on the physiotherapy course and the respondents in terms made such an offer to him. He accepted this offer by his response to PCAS, and even if no agreement was concluded at that stage, because PCAS had no authority to enter into legal relations on behalf of the respondents, his acceptance was in fact notified to the respondents, by PCAS on 9 July 1993 and by the appellant himself on 8 July 1993 on Form PA6, as he was requested and required to do by the PCAS rules. If the date of receipt is relevant, then it may be inferred that the respondents received it on 9 July 1993 or at latest on Monday, 12 July 1993.
The respondents contend that this agreement had no contractual force, first, because there was no common intention of forming legal relations; this may perhaps be restated as a contention that the agreement was provisional only, no contract coming into being until such time as the student-applicant enrols and is accepted as such; and secondly, that there was no consideration for the agreement, so that it is unenforceable as a matter of law.
The consideration issue is more straightforward and can be taken first. Lord Campbell QC's first submission is that consideration is provided by the plaintiff's undertaking to take up a place on the course. But Lord Campbell also asserted that the plaintiff was not bound to do this, so that the agreement was in the nature of an option, given to the plaintiff, to take up the place if he decided to do so. If this is correct, then in my judgment the consideration for the grant of such an option cannot lie in the plaintiff's undertaking, which he was not bound to perform. Such consideration must be found elsewhere.
Lord Campbell's alternative submission is that the appellant gave consideration for the respondents' offer of a place, by giving up the rights which he would otherwise have exercised to seek a place in some other physiotherapy course under the PCAS clearing scheme, which operates 'in late August/September'. Its purpose is to enable unplaced applicants to be considered for any 'remaining suitable vacancies' ('statement of decisions' leaflet, para 70). The plaintiff was only eligible to enter clearing if he had not withdrawn from the PCAS scheme and was holding no offers (para 71). The effect of his UF acceptance of the respondents' offer was to close his PCAS record, and the rules expressly provided that he thereby became ineligible to seek an alternative place through PCAS (para 36, already quoted).
In my judgment, giving up the chance of obtaining another place through PCAS clearing in this way was a sufficient detriment to constitute consideration moving from the plaintiff for the purposes of these technical rules of the law of contract: Chitty on Contracts (Sweet & Maxwell, 26th edn, 1989), vol 1, para 184. Mr Smouha submits on behalf of the respondents that this was not done at their request. The answer to this objection, in my judgment, is that the respondents having made their offer through PCAS, and in accordance with the PCAS scheme, did impliedly request the plaintiff, by inviting his acceptance of their offer, to take a step which to their knowledge necessarily involved his removal from the scheme and with it any opportunity to enter clearing in accordance with its rules.
Mr Smouha's second submission, which he supported with references to additional evidence which he produced during the hearing before us, was that the appellant could have re-entered the scheme and been eligible for clearing if he had approached PCAS promptly after Mr Simpson told him on 16 August 1993 that no place had been offered to him. In my judgment, this further objection fails on the facts. The appellant did contact PCAS. They confirmed that a place had been offered and accepted. The respondents did not suggest that there had been a clerical error until their letter of 3 September 1993. By that time, even if there was admissible evidence that PCAS would have readmitted him to the scheme (and I make this assumption in the respondents' favour, but without deciding that there was), the position clearly had changed since the date in mid-July 1993 when, if Mr Simpson had not been absent on sick leave, the error would have been noticed, according to Mr Simpson's evidence. Remaining places are widely advertised during August in the national press, and clearly the picture had changed.
I would also hold, if necessary, that the appellant was entitled to take the PCAS rules at their face value. They stated that the effect of his UF acceptance was to remove him from the scheme. He did not, in fact, enter clearing during August 1993 as he might have done. This was a sufficient detriment, even if, had he foreseen the need to do so, he might have induced PCAS to apply the rules exceptionally in his case.
Different submissions with regard to consideration were addressed to the deputy judge. They are summarised at pp 37-38 of the judgment. Mr Smouha relied upon the fact that the applicant, prior to enrolment, undertakes no liability with regard to fees. That is correct, but the plaintiff alleges, not a contract to educate in return for the payment of fees, but a contract to enrol the student in due course upon his arrival at the institution. Before the deputy judge, Lord Campbell QC relied upon the facts that the plaintiff had given up his job and accommodation, and other matters, and Mr Smouha responded that these were not given up at the respondents' request. The judgment held merely that there was no consideration (p 40) and in the light of the deputy judge's primary conclusion, that no legal relations were created, it was unnecessary for him to deal with this matter further.
For the reasons already given, I would hold that consideration for the respondents' undertaking was given. It is sufficient for the purposes of this interlocutory application that a strong and clear case is made out. I should refer to a possible further argument, which is also relevant to the respondent's submission that there was no intention to create legal relations. This involves some reference to the overall nature of the PCAS scheme, and in particular to the question whether the student-applicant who accepts an unconditional offer - the UF acceptance - is bound to take up that place, and if so, the extent to which he, or she, is so bound.
One situation is dealt with expressly in para 35, quoted above. The student remains free to take up a place outside the PCAS scheme. Particular reference to the UCCA scheme is found in paras 38 and 58-62 ('Applicants with offers in both PCAS and UCCA'). This does not apply in the present case.
Directly relevant, however, are paras 79-81, under the heading 'Notifying institutions of amended details'. These paragraphs read:
'Changing your mind
79. Once you have made your reply you cannot change it.
80. You cannot cancel a firm acceptance except by withdrawal from the scheme as detailed in earlier paragraphs.
81. However, in exceptional cases of hardship (eg a change in family circumstance) or genuine error, you should ask your referee to write to PCAS to recommend that you should be allowed to alter your applications and acceptances. Such requests will be considered sympathetically, and if it proves possible to amend your choice PCAS will write to you to explain what you should do.'
Then, paras 93-94 (heading 'Withdrawal') read as follows:
'93. If you decide to withdraw entirely from the PCAS scheme for this session (ie to give up all offers or places you may be holding) a slip is provided in the back of this leaflet which you should complete and send to PCAS immediately (and not later than 30 September 1993). Please bear in mind that if you decide to withdraw while holding a place but fail to do so promptly, you may deprive another applicant of the place.
94. PCAS will notify the institutions concerned. Withdrawal from the scheme excludes you from PCAS clearing.'
The respondents emphasise the provisional nature of some of these paragraphs, eg paras 93 and 39 (quoted above) as showing, as is undoubtedly correct, that there is a considerable amount of flexibility built into the scheme. This is in the interests of applicants, they submit, who need to remain free for as long as possible, that is, until the time of enrolment at the beginning of the October term, to choose the best available course for themselves. It also frees individual applicants from any risk of being held liable in damages to the institution concerned, if they fail to take up a place which they have undertaken to do. Therefore, Mr Smouha submits, the student is free from any obligation to take up a place, even when he has accepted an unconditional offer in the terms of Form PA6.
But it is the PCAS rules themselves which give the applicant this flexibility. Moreover, the time-limit of 30 September 1993 imposed by para 93 suggests that after that date the applicant is not free to withdraw from the scheme, and by para 80 he is not entitled to cancel a firm acceptance without withdrawing from it. The obligation, therefore, is minimal, but nevertheless according to the rules it does exist, and in my judgment it is fully arguable that the applicant does give consideration in this form. This is Lord Campbell's first submission, though in modified form, and the essence of it is that, far from being an option, the contract does include a limited undertaking by the applicant that he will not resile from his UF acceptance.
Intention to create legal relations
I have already referred to the respondents' contention that this is a flexible scheme, which as Mr Smouha submits was not intended to give rise to legal obligations until the applicant duly enrols as a student at the institution in question. The 'Conditions of acceptance' in the Guide for applicants include the following:
'Any offer of a place you may receive is made on the understanding that in accepting it you undertake to observe the rules and regulations of the institutions.
Should you become a student at a polytechnic, college or one of the new universities established under the Further and Higher Education Act 1992, it will be a term of your contract with that institution that it will take all reasonable steps to provide the educational services described in its prospectus...'
The latter part of this extract contemplates that a contract will come into being when the student does enrol, although there is no reference, it may be noted, to any further acceptance by the institution at that stage. (Mr Smouha's analysis, as I understood it, is that the offer made through PCAS remains open for acceptance by the student, but only when he presents himself for enrolment.) But it does not follow that no contract is concluded at an earlier stage, and, notwithstanding the flexibility which the scheme allows to applicants until 30 September 1993, it would no doubt come as a surprise to many thousands of applicants, who give firm acceptances in response to unconditional offers, were they told that the institution is not bound to provide them with a place, and is free to withdraw the offer at any time before they present themselves for enrolment at the beginning of the academic year.
The nature and terms of the PCAS documents are such, in my judgment, that they point to agreements made under and in accordance with the scheme being intended to have legal effect. That is admittedly the case as regards the relationship between the applicant and PCAS and, presumably, as between PCAS and the institutions which use its services. I would reject the respondents' submission that the agreement concluded between themselves and individual applicants is not binding upon them in accordance with its terms.
The respondents relied upon the judgment of the Court of Appeal in the Orphanos case (reported in the House of Lords as Orphanos v Queen Mary College [1985] AC 761). The underlying issue was whether the plaintiff had enrolled as a home or overseas student, the difference significantly affecting his fees. The place was applied for through the UCCA scheme, and the college had written to the applicant in terms which included a reference to his decision 'to give a firm acceptance of our offer of a place on the above-named course'. After quoting this, in his judgment in the Court of Appeal, Griffiths LJ said (at page 4C):
'Although the letter speaks of a firm acceptance of an offer, at this stage of the relationship neither party was bound to the other because, as yet, the vital question of fees had not been settled between them.'
May LJ agreed (page 9A).
The reason given by Griffiths LJ in that case does not apply in the present case. If a vital term such as the payment of fees was not agreed, then clearly there could be no contract, whatever the terms of the agreement between them. The question whether that agreement, fees apart, was intended to create legal relations therefore did not arise. It is true that an earlier passage in Griffiths LJ's judgment gives some support to Mr Smouha's 'flexibility' argument, particularly the sentence (at page 2F):
'The relationship between the parties was built up step by step... culminating when he enrolled at Queen Mary College in October 1982.'
But the question whether the agreement which is concluded when the institution offers and the applicant accepts a firm place is enforceable as a contract did not arise. Whether or not such an agreement is legally enforceable depends primarily upon the terms of the particular agreement and secondly upon the 'matrix' which is provided by the scheme itself. In my judgment, the terms and the circumstances in the present case were such that a contract did arise. The express provisions in the PCAS documents were sufficient to give the student extensive rights of withdrawal. There are no provisions which give the institution any corresponding rights to withdraw an unconditional offer once duly accepted, and if such a term is necessary in order to protect the institutions, who undoubtedly have a difficult task in making up their courses year by year, with many thousands of applicants for each one, then it could easily be included in the PCAS scheme.
This leads to one final matter in the form of an extract from the PCAS operations manual, which was provided for the respondents but not to the applicant:
'4.12 Errors in transmitting decisions
Very occasionally an incorrect decision may be sent to the applicant either because of a coding or software error by the institution, or because the institution's decision has been incorrectly read by PCAS. Applicants are warned that errors may occur and can be corrected, but it would be unreasonable to amend a decision, except in the applicant's favour, unless the amendment is made fairly soon after communicating the erroneous decision.'
No such term was made known to the applicant, nor was any warning given. If it had been a term of their agreement, then its presence would tend to suggest that firm arrangements were intended to be binding, and the question would have arisen whether the respondents acted reasonably or 'fairly soon' after their erroneous decision was communicated to him. Since they made no communication until he contacted them on 16 August 1993, and it was not until 3 September 1993 that they asserted that they had made an error, it seems unlikely that they would have succeeded on this issue, if it had arisen.
Estoppel
Lord Campbell QC's alternative submission on behalf of the plaintiff before the deputy judge was based on equitable estoppel. The judgment records the submission as follows (at page 41):
'He argued that the defendants had represented to the plaintiff that they (the university) had accepted him for the course but the plaintiff had altered his position, i.e. that his dealings with PCAS were at an end, that he could not apply for a course at any other university and that he had given notice to terminate his employment and to sublet his accommodation.'
The authority relied on was a passage from Halsbury's Laws of England (4th edn), vol 44, para 438 but, as the judgment records, no decided case was cited in support. The judge referred to a recent Irish report, Kenny v Kelly [1988] IR 457, and he concluded (at page 44):
'there must be, it seems, a pre-existing agreement prior to conduct which is said to found the estoppel. As I have found that no contract was made, in my judgment the claim for promissory estoppel will also fail...'
Before us, Lord Campbell QC relied upon two decisions of the Court of Appeal, first Evenden v Guildford City Association Football Club [1975] 1 QB 91, and secondly Amalgamated Investment & Property Co (in liquidation) v Texas Commerce International Bank [1982] QB 84, and he referred in particular to the judgments of Lord Denning MR in both cases. The submission in essence is that there was a course of dealing between the parties, involving a representation by the respondents that a place was available for the appellant and detriment suffered by him in reliance on that promise, from which in fairness and justice the respondents should not be permitted to resile.
Whether the doctrine of 'estoppel by convention' permits a plaintiff to succeed in an action where he cannot establish a cause of action based on breach of contract is not decided finally by the Amalgamated Property case: see Chitty on Contracts (above), vol 1, para 222/4. The question is a variant, and possibly no more than a restatement, of the issue raised by the High Trees decision [1947] KB 130: can the equitable estoppel be used as a sword, or only as a shield (Combe v Combe [1951] 2 KB 215)?
That this is the pedigree of the issue raised in the present case is confirmed by the fact that the decision of Barron J in Kenny v Kelly (above) was based on judgment of the Supreme Court of Ireland in Webb v Ireland [1988] IR 353 where Amalgamated Property was discussed.
The matter was not fully argued before us, because it became unnecessary for Mr Smouha to respond to Lord Campbell's submission, and I would add only this. Lord Campbell suggested that a remedy based on estoppel might be open to the appellant even if the respondents succeeded in their contention that the dealings were not intended to create legal relations. I find this difficult to accept, because the usual definition of estoppel includes an express or implied representation which was 'intended to be binding and intended to be acted upon' (per Lord Denning MR [1975] 1 QB 91, at p 924A).
Discretion
Mr Simpson states (affidavit, para 11):
'I have reviewed the application submitted by Mr Moran. Even if he had submitted his application at a "non-late" stage he would not have qualified for an interview.'
The significant facts in my judgment are that the offer of a place was undoubtedly based on a clerical error, although this was compounded by the respondents' failure to discover and rectify it until prompted to do so by the appellant's own inquiry, and that on the evidence before us the appellant could only be accommodated on the course by increasing the number of students for which it is designed. Moreover, if an extra place had been available, it would have been filled by another more highly qualified applicant. There is no room for any suggestion that the applicant was excluded for some other reason, for example, that he is a mature student. He was not offered an interview by any of the five UCCA or three other PCAS institutes to which he applied.
For these reasons, and in agreement with Glidewell LJ's judgment, I would hold that no order for specific performance or by way of an interlocutory injunction should be made in this case. I should add however, that if the only objections to such an order were those based on administrative matters, such as the agreement with the regional health authority, then I would have regarded the application with greater sympathy. The contract relied upon is an agreement to enrol, not to educate, and the respondents do not suggest that, if enrolled, a student who was properly qualified for the course could not perform satisfactorily upon it. There would be no element of personal services such as might, in certain circumstances, preclude the grant of a mandatory injunction: see Spry's Principles v Equitable Remedies (Sweet & Maxwell, 3rd edn), page 111.
Conclusion
For these reasons, and those given by Glidewell LJ, I would hold that the appellant makes out a sufficient case for breach of contract to justify the making of the order which he seeks, but that in the circumstances of this case no order should be made. I would therefore dismiss the appeal.
JUDGMENT BY WAITE LJ
My own agreement to the decision (already announced) to dismiss the appeal was reached for the same reasons as those set out in the judgments already delivered, with which I fully concur, and to which (although we are differing from views which the judge set out with impressive clarity and care) I do not wish to add anything.
DISPOSITION
Appeal dismissed. Leave to appeal to the House of Lords refused. No order as to costs.
SOLICITORS
North Lewisham Law Centre for the appellant
Eversheds Alexander Tatham for the respondent
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