2006.11.27

2005 (Ju) 1158

Minshu Vol. 60, No. 9

Judgment concerning the nature of an enrollment contract concluded between a university and a university's student

Case to seek refund of unjust enrichment

Judgment of the Second Petty Bench, partially quashed and remanded, partially quashed and decided by the Supreme Court, partially dismissed

Tokyo High Court, Judgment of March 10, 2005

1. An enrollment contract to be concluded between a university, on one hand, and the university's students, on the other, is, in its primary aspect, intended to stipulate that the university is obliged to provide students with the educational services in line with the purposes of universities by implementing educational activities such as lectures and practical training and experimental programs, and is also obliged to provide students with access to necessary educational and other facilities, whereas students are obliged to pay consideration for these services, and there is also the aspect of enabling students to obtain and maintain the status and position of a student of a university, an organization constituting an independent society, while obliging them to abide by the university's comprehensive guidance and discipline; in short, an enrollment contract is a non-statutory contract under private law that has the nature of a bilateral contract for value, which is expected to be governed by educational statutes and the philosophy of education.

2. An admission fee payable by applicants who have passed a university's admission examination has the nature of consideration payable by such applicants for obtaining the position to enroll in the university unless there are special circumstances where it seems to have another nature because the amount thereof is unreasonably large, and it is expected to also be used as expenses for necessary administrative work in order for the university to accept applicants who have passed the admission examination as its students.

3. Applicants who have concluded an enrollment contract, etc. with a university or made a reservation therefor can, in principle, voluntarily at any time cancel the enrollment contract or the reservation for the future.

4. Where a student who has passed a university's admission examination and concluded an enrollment contract with the university notifies the university of his/her declination of admission, as long as the student's conclusive intention is indicated, even when it is made orally, it is, in principle, a valid manifestation of the intention to cancel the enrollment contract. Even where it is provided in the university's basic requirements for the applicants of admission examination or a similar document that the required fees except for admission fee shall be returned to applicants who have notified the university of their declination of admission in writing within a specified time limit or that applicants who decline admission shall make notification in writing, such oral notification of declination of admission still has the effect of canceling the enrollment contract.

5. Where applicants who have passed a university's admission examination have concluded an enrollment contract with the university or made a reservation therefor and paid admission fee, which has the nature of consideration for obtaining the position to enroll in the university, even if the enrollment contract or the reservation therefor is canceled or loses its effect after the payment, the university is not obliged to return the admission fee to such applicants.

6. A special provision of an enrollment contract concluded between an applicant who has passed a university's admission examination, on one hand, and the university, on the other, to the effect that the tuition fee, etc. already paid shall not be returned, shall be seen as a provision which liquidates in advance the amount of damages or defines the penalty upon cancellation of the enrollment contract.

7. An enrollment contract concluded between an applicant who has passed a university's admission examination, on one hand, and the university, on the other, or a reservation therefor falls under the category of consumer contract prescribed in Article 2, para.3 of the Consumer Contract Act.

8. Where a special provision is included in an enrollment contract concluded between an applicant who has passed a university's admission examination, on one hand, and the university, on the other, to the effect that the tuition fee, etc. already paid shall not be returned, although there is room for making some presumption based on facts, the applicant who argues that the whole or part of the special provision is void shall basically bear the burden of going forward with evidence with regard to the average amount of damage prescribed in Article 9, item 1 of the Consumer Contract Act and the amount that exceeds it.

9. With regard to a special provision included in an enrollment contract concluded between an applicant who has passed a university's admission examination, on one hand, and the university, on the other, to the effect that the tuition fee, etc. already paid shall not be returned, under the factual circumstances where (i) national universities and public universities announce applicants who have passed the second admission examinations by around March 24 every year, (ii) most private universities have announced regular successful applicants by that day, and (iii) they announce additional successful applicants by the end of March, if the applicant manifests the intention to cancel the enrollment contract by March 31, the day before April 1, a (private) university, in principle, suffers no average amount of damage that would normally be suffered by the university as prescribed in Article 9, item 1 of the Consumer Contract Act, and therefore the whole of the special provision should be void; on the other hand, if the applicant manifests the intention to cancel the enrollment contract on or after April 1, in principle, the tuition fee, etc. already paid to the university should not be regarded to exceed the average amount of damage if the amount of such payment is not beyond that payable for the first academic year, and therefore the whole of the special provision should be valid.

10. Where a university requires applicants to designate the university or department thereof as their only or first choice or definitely promise to enroll in the university or department, as a qualification for the university's examination for admission based on recommendation under its basic requirements for the applicants of admission examination, a special provision included in an enrollment contract concluded between an applicant who has passed the examination for admission based on recommendation (or other similar admission examination), on one hand, and the university, on the other hand, to the effect that the tuition fee, etc. already paid shall not be returned, should be regarded as being valid, because the tuition fee, etc. already paid should be regarded as not exceeding the average amount of damage as prescribed in Article 9, item 1 of the Consumer Contract Act if the amount of such payment is not beyond that payable for the first academic year, and unless there are special circumstances where the cancellation of the enrollment contract occurs at a time when it has not yet become generally impossible for the university to easily recruit additional students to fill vacancies generated due to the cancellation by holding an additional admission examination.

(Concerning 1, 2, and 5) Civil Code, Part III, Chapter 2 Contract; (Concerning 1) Article 52 and Article 69-2, para.1 of the School Education Act, Article 6, para.1 of the Education Basic Act; (Concerning 2, 5, 6, and 8 to 10) Article 6 of the School Education Act; (Concerning 2 and 5) Article 4, para.1, item 7 of the Ordinance for Enforcement of the School Education Act; (Concerning 3 and 4) Article 540, para.1 of the Civil Code; (Concerning 3) Article 26, para.1 of the Constitution, Article 67 of the Ordinance for Enforcement of the School Education Act; (Concerning 5) Article 703 of the Civil Code; (Concerning 6, and 8 to 10) Article 420 of the Civil Code; (Concerning 7) Article 2 of the Consumer Contract Act; (Concerning 8 to 10) Article 9 of the Consumer Contract Act; (Concerning 8) Code of Civil Procedure, Part II, Chapter 4, Section 1 General Provisions; (Concerning 9) Article 44 and Article 72, para.1 of the Ordinance for Enforcement of the School Education Act

Article 52 of the School Education Act
(Purpose of Universities)
The purpose of universities is, as the centers of academic excellence, to impart a broad range of knowledge to students as well as teach and research specialized arts and sciences in depth and develop students' intellectual ability, morals, and skill at applying their knowledge.

Article 69-2, para.1 of the School Education Act
(Junior Colleges)
Instead of the purposes set forth in Article 52, universities may designate it as their major purpose to teach and research specialized arts and sciences in depth and develop students' abilities necessary for their profession or daily living.

Article 6, para.1 of the Education Basic Act
(School Education)
Schools prescribed by Acts shall be of public nature, and in addition to the State and local public entities, only juridical persons prescribed by Acts may establish schools.

Article 6 of the School Education Act
(Tuition Fees)
Schools may collect tuition fees; provided, however, that no tuition fee may be collected for compulsory education in national or public elementary schools or lower secondary schools, or schools for the blind, schools for the deaf or schools for the otherwise disabled which are equivalent to elementary or lower secondary schools, or in the lower division of secondary schools.

Article 4, para.1, item 7 of the Ordinance for Enforcement of the School Education Act
School regulations set forth in the preceding Article shall provide for, at least, the following matters:
(vii) Matters concerning the collection of tuition fee, admission fee and other expenses

Article 540, para.1 of the Civil Code
(Exercise of Right of Cancellation)
Where either party has a right of cancellation by contract or by provisions of Acts, such party may make cancellation by making a manifestation of intention to the other party.

Article 26, para.1 of the Constitution
(1) All people shall have the right to receive an equal education correspondent to their ability, as provided for by law.

Article 67 of the Ordinance for Enforcement of the School Education Act
The principal shall, after obtaining resolution of the board of professors, determine admission to the university, withdrawal from the university, transfer to other university, overseas study, absence from the university, and graduation from the university.

Article 703 of the Civil Code
(Obligation to Return Unjust Enrichment)
A person who, without any legal ground, obtains profit from another person's property or services, thereby causing damage to the latter (referred to as "Beneficiary" in this Chapter), shall be obliged to return such profit to the extent that it still exists.

Article 420 of the Civil Code
(Liquidated Damages)
(1) The parties may agree on the amount of the liquidated damages with respect to the failure to perform the obligation. In such case, the court may not increase or decrease the amount thereof.
(2) The liquidated damages shall not preclude the demand for performance or the exercise of the cancellation right.
(3) Any penalty is presumed to constitute liquidated damages.

Article 2 of the Consumer Contract Act
(Definitions)
(1) The term "consumer" as used in this Act shall mean an individual (excluding, however, any individual who becomes a party to a contract in the course of, or for the purpose of, his/her business).
(2) The term "business operator" as used in this Act shall mean a juridical person, and other type of association, and an individual who becomes a party to a contract in the course of, or for the purpose of, his/her business.
(3) The term "consumer contract" as used in this Act shall mean a contract concluded between a consumer, on the one hand, and a business operator, on the other.

Article 9 of the Consumer Contract Act
(Invalidation of Clause which Stipulates the Amount of the Damages to be Paid by Consumer)
The clauses of a consumer contract set forth in the following items shall be void to the extent specified in the respective item:
(i) Any provision which liquidates in advance the amount of damages, or defines the penalty, associated with any termination of the relevant consumer contract where the aggregate sum of such amounts exceeds the average amount of damages which, depending on the category established in such provision such as the cause or timing of termination, should normally be suffered by the relevant business operator in association with the consumer contract similar to such consumer contract: To the extent of the amount which so exceeds.
(ii) Any provision which liquidates in advance the amount of damages, or defines the penalty, in case the relevant consumer fails to pay any money due and payable under the relevant consumer contract, in whole or in part, by the due date of payment (in case of any payment in two or more installments, hereinafter in this Item referring to the due date of the respective date of installment payment) where the aggregate sum of such amounts exceeds the amount which is calculated on a daily pro-rata basis by multiplying (a) the amount to be paid on such due date of payment less such portion of the amount to be paid on such due date of payment as has been already paid by (b) the rate of 14.6% per annum, covering the period from (and including) the date immediately following such due date of payment through the date when such payment is actually made: To the extent of the amount which so exceeds.

Article 44 of the Ordinance for Enforcement of the School Education Act
The academic year of elementary school shall start on April 1 and end on March 31 of the following year.

Article 72 of the Ordinance for Enforcement of the School Education Act
The provisions of Article 28 and Article 44 shall apply mutatis mutandis to universities.

1. The original judgment is quashed with respect to the part dismissing the appeal to the court of the second instance filed by the appellant at the court of the last resort in 2005 (Ju) No. 1158 against the appellee at the court of the last resort in the same case, and the part quashing the judgment of the first instance based on the appeal to the court of the second instance filed by the appellee at the court of the last resort in 2005 (Ju) No. 1159 against the appellant at the court of the last resort in the same case.
2. This case is remanded to the Tokyo High Court with respect to the part concerning the appellant at the court of the last resort in 2005 (Ju) No. 1158 mentioned in the preceding paragraph.
3. The appeal to the court of the second instance filed by the appellee at the court of the last resort in 2005 (Ju) No. 1159 is dismissed with respect to the part concerning the appellant at the court of the last resort in the same case mentioned in paragraph 1.
4. The remaining part of the appeal to the court of the last resort filed by the appellant at the court of the last resort in 2005 (Ju) No. 1159 is dismissed.
5. Between the appellant and appellee at the court of the last resort in 2005 (Ju) No. 1159, the costs of the lawsuit in the second instance and in this instance shall be divided into five, three parts of which shall be borne by the appellee and the rest by the appellant.

I. Outline of the case
1. The outline of the facts legally determined by the court of the second instance is as follows:
(1) The appellant at the court of the last resort in 2005 (Ju) No. 1158/appellee at the court of the last resort in 2005 (Ju) No. 1159 (hereinafter referred to as "Defendant University") is a school corporation that has established University Y as a university operating under the School Education Act (hereinafter, University Y established by Defendant University may also be referred to as "Defendant University").
(2) The appellee at the court of the last resort in 2005 (Ju) No. 1158 (hereinafter referred to as "Plaintiff X1"), on November 17, 2001, participated in the examination for admission on general recommendation (open recruitment) to Defendant University, College of Art, Drama Department (Stage Direction Course) in FY2002 (hereinafter referred to as the "Examination for Admission Based on Recommendation"), and passed the examination on November 27. Then, in accordance with the "Basic Requirements for the Applicants of the Examination for Admission Based on General Recommendation (Open Recruitment) to University Y, College of Art in FY2002" and the "Basic Requirements for the Enrollment Procedure of University Y, College of Art in FY2002 [Successful Applicants in the Examination for Admission Based on General Recommendation (Open Recruitment)]," Plaintiff X1 paid to Defendant University, by the predetermined due date, 980,000 yen in total as the payment for enrollment, and submitted the enrollment documents, thereby completing the enrollment procedure. The breakdown of the amount paid was as follows: 260,000 yen as admission fee; 710,000 yen as tuition fee, etc. (tuition fee, facility expenses, expenses for practical training and experimental programs), and; 10,000 yen as membership fee for the university supporters' association (the due date of payment was December 4, 2001; the amounts paid as the tuition fee, etc. and the membership fee were half of the amounts payable in the first academic year).
The "Basic Requirements for the Applicants of the Examination for Admission Based on General Recommendation (Open Recruitment) to University Y, College of Art in FY2002" provided for the following qualification of applicants for the Examination for Admission Based on Recommendation: "persons who have strong passion for respective disciplines, a wealth of artistic talent, and future potential, and are able to definitely promise to enroll in the college if they pass the examination."
(3) The appellant at the court of the last resort in 2005 (Ju) No. 1159 (hereinafter referred to as "Plaintiff X2"; Plaintiff X1 and Plaintiff X2 may hereinafter be collectively referred to as the "Plaintiffs") participated in and passed the general admission examination for Defendant University, College of Humanities and Science, Psychology Department in FY2002, and in accordance with the "Basic Requirements for the Applicants of the Admission Examination for University Y in FY2002" and the "Basic Requirements for the Enrollment Procedure of University Y, College of Humanities and Science in FY2002," paid to Defendant University, by the predetermined due dates, 690,000 yen in total as the payment for enrollment, and submitted the enrollment documents, thereby completing the enrollment procedure. The breakdown of the amount paid was as follows: 260,000 yen as admission fee (fee for enrollment application) (due date of payment: March 1, 2002); 420,000 yen as tuition fee, etc. (tuition fee, facility expenses, expenses for practical training and experimental programs), and; 10,000 yen as membership fee for the university supporters' association (the due date of payment of the tuition fee, etc. and the membership fee was March 25, 2002; the amounts paid as the tuition fee, etc. and the membership fee were half of the amounts payable in the first academic year).
(4) All of the basic requirements for the applicants for the admission examination and the basic requirements for the enrollment procedure mentioned in (2) and (3) above (hereinafter collectively referred to as the "Basic Requirements") provided that the enrollment documents and the payment for enrollment submitted and paid to the university shall not be returned for any reason. According to this provision, agreements were made between Plaintiff X1 and Defendant University and between Plaintiff X2 and Defendant University, respectively, to the effect that Defendant University shall not return, for any reason, the payment for enrollment mentioned in (2) and (3) that had been paid by the Plaintiffs (hereinafter collectively referred to as the "Payment for Enrollment," of which the admission fee, tuition fee, etc., and membership fee for the university supporters' association shall hereinafter be referred to as the "Admission Fee," "Tuition Fee, etc.," and "Membership Fee," respectively) (these agreements shall hereinafter be referred to as the "Special Provisions on Non-Return").
(5) On March 13, 2002, Plaintiff X1, by submitting a document entitled "Notice of Withdrawal from University," notified Defendant University of his/her declination of admission to Defendant University.
(6) Around March 29, 2002, Plaintiff X2 notified Defendant University by phone of his/her declination of admission to Defendant University, and on April 3, 2002, the document entitled "Notice of Declination of Admission to University" sent by Plaintiff X2 arrived at Defendant University.
(7) The Defendant University's university regulations contain the following provisions: (i) A student who intends to withdraw from the university because of illness or for any other unavoidable reasons shall submit to the dean of his/her department a written notice of withdrawal from university signed jointly by him/her and his/her guarantor, with a document proving the reason for withdrawal, and obtain permission from the dean; (ii) The expenses and/or fees already paid to the university shall not be retuned for any reason.

2. In this case, the Plaintiffs, alleging that they cancelled the enrollment contracts concluded with Defendant University by declining admission to Defendant University, seek from Defendant University, based on the right to claim return of unjust enrichment, payment of the amount equivalent to the amount of the Payment for Enrollment and delay damages thereon. Against this claim, Defendant University argues that the Special Provisions on Non-Return made between the university and the Plaintiffs are valid.

II. Concerning the reasons for petition for acceptance of appeal to the court of the last resort argued by the appeal counsel in 2005 (Ju) No. 1158, SHINOZAKI Yoshiaki, et al. and the reasons for petition for acceptance of appeal to the court of the last resort argued by the appeal counsel in 2005 (Ju) No. 1159, IBARAKI Shigeru, OGURI Natsuki, and HARA Keiichiro
1. Based on the facts mentioned above, the court of the second instance upheld Plaintiff X1's claim to the extent to seek payment of 720,000 yen in total, which is equivalent to the sum of the Tuition Fee, etc. and the Membership Fee, and delay damages thereon, and dismissed Plaintiff X2's claim as a whole, on the following grounds:
(1) At the time when the Plaintiffs paid the Payment for Enrollment in full to Defendant University with necessary documents, and Defendant University received the fees and documents without objection, the enrollment contracts were established between the Plaintiffs and Defendant University, respectively (these contracts shall hereinafter be collectively referred to as the "Enrollment Contracts").
(2) Applicants who have passed a university's admission examination and concluded an enrollment contract with the university may, in principle, cancel the contract at any time. When such applicants have notified the university of their declination of admission to the university after an enrollment contract was effected, such notification can be regarded to be a manifestation of the intention to cancel the enrollment contract, and therefore by means of this notification, the enrollment contract shall be canceled for the future.
(3) For the termination of an enrollment contract, a uniform or clear procedure should be implemented, and it is necessary to confirm that applicants' intention to decline admission to university is final and conclusive. For these reasons, a notification of the declination of admission to university must be made in writing or any other objective and clear means, and even where applicants orally notify the university of their declination of admission, such oral notification shall not, in principle, have the effect of canceling the enrollment contract unless there are special circumstances where the university should necessarily treat the applicants who have made such notification as those who decline admission.
It follows that the Enrollment Contract between Plaintiff X1 and Defendant University was cancelled on March 13, 2002, when Plaintiff X1 submitted the "Notice of Withdrawal from University" to Defendant University. On the other hand, Plaintiff X2's notification by phone to Defendant University of his/her declination of admission cannot be deemed to have the effect of canceling the enrollment contract because no such special circumstances can be found, and therefore it should be construed that by means of the "Notice of Declination of Admission" that arrived at Defendant University on April 3, 2002, the Enrollment Contract between Plaintiff X2 and Defendant University was cancelled.
(4) Of the Payment for Enrollment, the Admission Fee has the nature of fee for performing administrative work for the enrollment procedure, consideration for obtaining the position to enroll in the university, and consideration for obtaining the position of the university's student after the enrollment procedure is completed. Since the Plaintiffs have received, by paying the Admission Fee, benefits from obtaining the position to enroll in the university and the position of the university's student, they cannot claim return of the Admission Fee even though they subsequently declined admission.
(5) Of the Payment for Enrollment, the Tuition Fee, etc. and the Membership Fee are consideration for educational services as well as other services including facility access and services for granting the status of student, which are to be provided by Defendant University under the enrollment contract. In the case of Plaintiff X1 whose enrollment contract with Defendant University was cancelled before April 1, the first day of the academic year, he/she did not receive any services mentioned above. Therefore, whether or not Defendant University is obliged to return the Tuition Fee, etc. and the Membership Fee to Plaintiff X1 depends on the validity of the Special Provisions on Non-Return. On the other hand, in the case of Plaintiff X2 whose enrollment contract with Defendant University was cancelled after April 1, he/she obtained the status of Defendant University's student as of April 1, 2002, and because of this, Defendant University started to provide Plaintiff X2 with the educational services as required under the enrollment contract. Therefore, Plaintiff X2 cannot claim return of the Tuition Fee, etc. and the Membership Fee from Defendant University.
(6) An enrollment contract to be concluded between a school corporation that has established and manages a university, on one hand, and an applicant who has passed the university' admission examination, on the other, falls under the category of consumer contract prescribed in Article 2, para.3 of the Consumer Contract Act, and the Special Provisions on Non-Return are deemed to be "any provision which liquidates in advance the amount of damages, or defines the penalty" as provided in Article 9, item 1 of the same Act (such provisions are hereinafter referred to as the "Penalty Clause").
(7) In the case of Plaintiff X1 whose enrollment contract was canceled before April 1, the cancellation of the enrollment contract cannot be deemed to have caused any damage to Defendant University. Accordingly, of the Special Provisions on Non-Return, the part concerning the Tuition Fee, etc. and the Membership Fee is void under Article 9, item 1 of the Consumer Contract Act, and therefore Defendant University is obliged to pay to Plaintiff X1 720,000 yen in total, which is equivalent to the sum of the Tuition Fee, etc. and Membership Fee, and delay damages thereon.

2. However, the determination of the court of the second instance mentioned in (3), (5), and (7) above cannot be affirmed on the following grounds. This determination was made based on the facts found by the court of the second instance, the facts known to the public, and the facts obvious to the court.
(1) General issues
(a) Nature of an enrollment contract
The purpose of universities (including junior colleges; the same shall apply hereinafter) is, as the centers of academic excellence, to impart a broad range of knowledge to students as well as teach and research specialized arts and sciences in depth and develop students' intellectual ability, morals, and skill at applying their knowledge (Article 52 and Article 69-2, para.1 of the School Education Act). An enrollment contract concluded between a school corporation, etc. that has established and manages a university (such school corporations that establish and manage universities may hereinafter also be referred to as "universities") and students of the university (the term "students" may hereinafter include applicants who have passed the university's admission examination and concluded an enrollment contract with the university or made a reservation therefor but have not yet enrolled in the university) is, in its primary aspect, intended to stipulate that the university is obliged to provide students with the educational services in line with the purposes mentioned above by implementing educational activities such as lectures, practical training and experimental programs, and is also obliged to provide students with access to necessary educational and other facilities, whereas students are obliged to pay consideration for these services. The provision of educational services, etc. is conducted in accordance with the university's education philosophy and education policy, with the use of its human and material resources for education, continuously and collectively based on the relationship of mutual trust with students. Accordingly, an enrollment contract also has the aspect of enabling students to obtain and maintain the status and position as a student of a university, which is an organization constituting an independent society, while obliging them to abide by the university's comprehensive guidance and discipline. Thus, an enrollment contract has multiple aspects as explained above. In addition, in light of the purposes and public nature of universities (Article 6, para.1 of the Education Basic Act), an enrollment contract is expected to be governed by educational statutes and philosophy of education, and there are some aspects that do not go along with the principle of trade law. Taking all of these points into consideration, it is appropriate to construe that an enrollment contract is a non-statutory contract under private law that has the nature of a bilateral contract for value.
(b) Time when an enrollment contract is established
Universities, in their regulations, the basic requirements for admission examination and the basic requirements for enrollment procedure (basic requirements for admission examination and for enrollment procedure shall hereinafter be collectively referred to as "basic requirements"), generally specify the time limit during which applicants who have passed the university's admission examination should, before enrollment, complete the enrollment procedure, such as paying fees including admission fee and tuition fee, etc. (these fees may be called "payment for enrollment," "fees required upon enrollment," "fees payable to university," and the like; hereinafter referred to as "payment for enrollment") and submitting necessary documents. Universities do not admit applicants who have failed to complete the enrollment procedure within the time limit, while treating those who have completed the procedure as expected students and preparing to accept them as the university's students. Therefore, unless there are any special circumstances, it is appropriate to construe that when a student has completed the enrollment procedure including payment of payment for enrollment within the time limit as specified by the basic requirements, an enrollment contract is established between the student and the university. If universities, in the basic requirements, set different time limits for the admission fee and other items of payment for enrollment, and grant applicants who have paid the admission fee the position to establish an enrollment contract by paying the remaining part of payment for enrollment later within a specified time limit, it is appropriate to construe that a reservation for an enrollment contract is made when applicants implement the initial part of the enrollment procedure by paying the admission fee in accordance with the procedures provided for by universities, and then an enrollment contract is established when they complete the remaining part of the enrollment procedure within the time limit, whereas the reservation for enrollment contract expires if they fail to complete the procedure. However, it is on the date of enrollment specified by the university (typically, April 1 of the enrollment year) that those who have completed the enrollment procedure and concluded an enrollment contract obtain the status of the university's student, and it is on the same day or thereafter that universities start to provide educational services, etc. Consequently, the obligation to pay consideration under an enrollment contract, a bilateral contract, comes into existence on that day (April 1) or thereafter.
(c) Nature of payment for enrollment
Payment for enrollment required under university regulations and basic requirements to be paid upon implementation of the enrollment procedure generally include: (i) admission fee; (ii) tuition fee (usually the amount payable for the first term of the first academic year or for the first academic year); (iii) expenses for practical training and experimental programs, facility expenses, expenses for advanced educational programs, and other expenses; (iv) membership fees for various associations such as the students' union, alumni association, and parents' association, as well as casualty insurance (hereinafter collectively referred to as "membership fees, etc."). Among these, (ii) and (iii) (hereinafter collectively referred to as "tuition fee, etc.") can be generally construed, in light of their names, to have the nature of consideration for educational and other services to be provided by the university to the students under an enrollment contract, and (iv) membership fees, etc. can also generally be construed to be paid as necessary expenses to be incurred when students receive education from the university or maintain their status of the university's student, with their purposes clearly specified. On the other hand, (i) admission fee is to be paid only upon enrollment, and generally treated in a manner different from that for other items of payment for enrollment; for instance, most universities' basic requirements set different time limits of payment for the admission fee and for other items of payment for enrollment, or provide that payment for enrollment except for the admission fee shall be returned to applicants who have notified the university of their declination of admission within a specified time limit. Admission fee is also distinguished from tuition fee under laws and regulations (e.g. Article 4, para.1, item 7 of the Ordinance for Enforcement of the School Education Act).
In Japan, the time of enrollment in university is generally set as the first day of the academic year, i.e. April 1 (Article 72 and Article 44 of the Ordinance for Enforcement of the School Education Act, and university regulations), and student recruitment is conducted in a limited period of each year. However, since admission examinations differ with universities or departments or depending on the types of examination, it is possible for an applicant to participate in admission examinations for more than one university or department in the same academic year. Because of this, the majority of applicants participate in admission examinations for more than one university or department, and, based on his/her preference and other consideration, choose one university in which they will actually enroll from among the universities for which they have passed examinations. In addition, since the date of announcement of the examination result or the period for the enrollment procedure also differ with universities or departments or depending on the types of examination, applicants who have passed admission examinations for more than one university or department generally decide whether or not to implement the whole or part of the enrollment procedure including payment of admission fee in order to conclude an enrollment contract or make a reservation therefor (hereinafter collectively referred to as "enrollment contract, etc.") with a particular one of the universities or departments, taking into consideration various factors such as the degree of their desire to go to the university or department, the result of, or prospect for, the admission examinations for other universities or departments in which they have also participated, and the degree of their desire to go to such other universities or departments. As a general practice, those who have passed an admission examination of a university can, by concluding an enrollment contract, etc. with the university, secure the position not to be subject to cancellation of the enrollment contract, etc. by the university without justifiable reasons, or in other words, the position to enroll in the university, and then wait for the announcement of their success or failure in the admission examinations for other universities or departments in which they have also participated, thereby finally choosing the university or department in which they will actually enroll (with respect to the universities or departments that they do not choose to enroll in although they have implemented the whole or part of the enrollment procedure, they do not implement the remaining part of the enrollment procedure or they make notification of the declination of admission). In the case where they fail to pass admission examinations for such other universities or departments, they usually enroll in the university or department where they have in advance secured the position to enroll, thereby avoiding the situation where they have no university to which to go. On the other hand, universities treat all students who have implemented the whole or part of the enrollment procedure including payment of admission fee, thereby concluding an enrollment contract, etc., as expected students irrespective of whether or not they will actually enroll in the university, and perform administrative work for the enrollment procedure in order to accept such students as the university's students.
The admission fee, in light of the circumstances described above concerning this, as well as its name, should be deemed to have the nature of consideration payable by students for obtaining the position to enroll in the university, unless there are special circumstances where it seems to have another nature because the amount thereof is unreasonably expensive, and it should be construed that the admission fee is expected to also be used as expenses for necessary administrative work in order for the university to accept applicants who have passed the admission examination as its students. Furthermore, it cannot be concluded that it is against public policy for universities to oblige applicants to pay an admission fee with such nature upon concluding an enrollment contract, etc.
(d) Cancellation of an enrollment contract, etc.
(d.1) In light of the purpose of Article 26, para.1 of the Constitution, which guarantees the right to receive education, as well as the philosophy of education, when students, who have concluded an enrollment contract, etc. with a university, decide whether or not to actually receive education at that university, the students' intention must be respected to the fullest extent. Therefore, it is appropriate to construe that students can, in principle, voluntarily at any time cancel the enrollment contract, etc. for the future, whereas the university is not allowed to unilaterally cancel the enrollment contract, etc. without justifiable reasons. Although Article 67 of the Ordinance for Enforcement of the School Education Act provides that the principal of the university shall determine students' withdrawal from university after obtaining resolution of the board of professors, and some universities provide in their university regulations that students who wish to withdraw from the university (cancel the enrollment contract) shall obtain permission from the principal, etc, when taking into account the reasoning mentioned above, these provisions of the School Education Act and university regulations should not be construed to be intended to restrict students from exercising the right to cancel the enrollment contract or adversely affect the validity of the students' cancellation of the enrollment contract.
(d.2) When students, after completing the enrollment procedure and concluding an enrollment contract with a university, have lost the intention to enroll in the university and declined admission because they have made up their mind to enroll in another university for which they also participated in and passed an admission examination or for other reasons, their declination of admission can be regarded as a manifestation of the intention to cancel the enrollment contract.
(d.3) Declination of admission (cancellation of the enrollment contract) significantly affects the student's status or position. In addition, each university performs administrative procedures for a number of students. Therefore, it is desirable for universities that manifestation of a student's intention to decline admission is made by means that enable confirming such intention as clearly and uniformly as possible, for example, by manifestation in writing. However, since there are no laws or regulations providing a procedure for declining admission, as long as the student's conclusive intention is indicated, it is appropriate to basically regard such notification, even when it is made orally, as a valid manifestation of the intention to cancel the enrollment contract. Considering that, as mentioned above, students can in principle cancel the enrollment contract voluntarily at any time, even where it is provided in the university's basic requirements that payment for enrollment except for admission fee shall be returned to applicants who have notified the university of their declination of admission in writing within a specified time limit or that an applicant who intends to decline admission shall make notification in writing, these provisions cannot be construed to mean that a notification of declination of admission does not have the effect of canceling the enrollment contract unless it is made in writing.
Furthermore, where it is provided in the university's basic requirements that "students who, without notice, fail to appear at the enrollment ceremony shall be deemed to have declined admission" or "admission shall be canceled if students, without notice, fail to appear at the enrollment ceremony," it is appropriate to construe that when students, without notice, fail to appear at the enrollment ceremony, their nonappearance is an implicit manifestation of the intention to cancel the enrollment contract, unless there are any special circumstances.
(d.4) When an enrollment contract is canceled, it shall lose its effect for the future. Accordingly, where a student cancels the enrollment contract before the day when he/she enrolls in the university (typically, April 1 of the enrollment year), he/she does not obtain the status of the university's student or the opportunity to receive educational services, etc. from the university, and in such case, unless there are any special provisions, the university has no grounds to receive tuition fee, etc. as consideration for providing services under the enrollment contract, and therefore the university is obliged to return tuition fee, etc. to the student. Even where the enrollment contract is canceled after that date, if the cancellation is made during the academic term or year for which tuition fee, etc. has been paid in advance, the university is not eligible to necessarily obtain the portion of the tuition fee, etc. corresponding to the period for which the university has not yet provided the services under the enrollment contract. In addition, with respect to membership fees, etc., considering that such fees are typically paid to the university as expenses of the nature described above and are required to be paid together with tuition fee, etc. upon conclusion of an enrollment contract, where the enrollment contract is canceled and loses its effect for the future, there is no reason, in principle, to distinguish membership fees, etc. from tuition fee, etc. in terms of the obligation to return. Even if the university must pay some of the membership fees, etc. to other entities, this cannot be a reason for the university to avoid the obligation to return by reason that the university does not obtained any profit from such fees. On the other hand, admission fee is the nature of consideration payable by students to obtain the position to enroll in the university, and a student can obtain such position by paying it. Therefore, even if the enrollment contract, etc. is canceled or loses its effect after it is paid, the university has no reason to be obliged to return it.
(e) Nature of Special Provision on Non-Return
(e.1) Most universities provide, in their basic requirements, that "payment for enrollment already paid shall not be returned for any reason" or "payment for enrollment except for admission fee shall be returned only to applicants who have notified the university of their declination of admission within a specified time limit." Students who have made payment for enrollment and concluded an enrollment contract, etc. with a particular university are, unless there are any special circumstances, deemed to have made the payment for enrollment after understanding or recognizing these provisions. Therefore, in such case, it is deemed that between the students and the university, a special agreement concerning the enrollment contract, etc. has been established based on these provisions (such agreement shall hereinafter referred to as "special provision on non-return").
(e.2) As explained above, with respect to the admission fee, even where the enrollment contract, etc. is canceled or loses its effect after it is paid, the university is not obliged to return it because of its nature. Therefore, the part of the special provision on non-return concerning the admission fee is nothing more than a cautionary provision.
(e.3) On the other hand, the part of the special provision on non-return concerning tuition fee, etc. is an agreement that in the case of cancellation of the enrollment contract, the university shall obtain money that is equivalent to tuition fee, etc., which otherwise should be returned to the students who have cancelled the contract. Under the present situation in Japan where applicants participate in admission examinations and choose universities as described above, it is very uncertain whether applicants who have passed a university's admission examination and concluded an enrollment contract, etc. with the university will actually enroll in the university. In the case of private universities, however, tuition fee, etc. collected from students are their major financial source to cover their expenses, and national subsidies, another important financial source, may be reduced or stopped if the number of students or the number of new enrollees is far beyond or far below the student quota or admission quota (Article 5, item 2 and item 3 and Article 6 of the Private School Promotion Subsidy Act; the "Guideline for Handling Subsidies for Current Expenditure of Private Universities" established by the Promotion and Mutual Aid Cooperation for Private Schools of Japan, etc.) In addition, universities are governed by laws and regulations and are subject to the supervision of the competent government agency with regard to their establishment and management, and they are obliged to secure human and material resources for education as required under the Standards for Establishment of Universities (or Standards for Establishment of Junior Colleges) depending on the student quota set under the university regulations (Article 3 of the School Education Act, Article 66 of the Ordinance for Enforcement of the School Education Act). Therefore, it is not easy to reduce expenditure even when the number of new enrollees decreases. Furthermore, universities can recruit new students only in a limited period of each year and it is difficult to additionally recruit new students after that period. Also, since the period of study at university is considerably long (generally four or six years; two or three years in the case of junior college) (Article 55 and Article 69-2, para.2 of the School Education Act), it is also not always easy to recruit students who are studying at other universities or departments (including graduates from other universities or departments). On the other hand, if universities, in a desperate attempt to recruit more new students, offer admission even to applicants who are inferior in academic ability, expecting that a large number of applicants will decline admission, such attempt would cause problems or disadvantages with the level of the university's education and study or its social evaluation. In light of these circumstances, the purpose and significance of a special provision on non-return can be deemed to be to avoid or compensate any loss of income from tuition fee, etc. or other tangible or intangible loss or disadvantage that universities are likely to suffer from applicants' declination of admission (cancellation of the enrollment contract). A special provision on non-return is also helpful in securing a sufficient number of expected students with superior academic ability at an early stage.
For the reasons stated above, it is appropriate to construe that the part of a special provision on non-return concerning tuition fee, etc. is of the nature of a provision which liquidates in advance the amount of damages or defines the penalty upon cancellation of the enrollment contract. This seems to be basically applicable to the part of a special provision on non-return concerning membership fees, etc.
Consequently, as long as a special provision on non-return (the parts thereof concerning tuition fee, etc. and membership fees, etc.; the same shall apply hereinafter) is found to be valid, universities are not obliged to return tuition fee, etc. and membership fees, etc.
(f) Application of the Consumer Contract Act to an enrollment contract, etc.
The Consumer Contract Act defines contracts concluded between consumers prescribed in Article 2, para.1 of the same Act, on one hand, and business operators prescribed in para.2 of the same Article, on the other, as consumer contracts, and comprehensively governs such contracts entirely (para.3 of the same Article). Since every juridical person, for-profit or non-profit, including public corporations and non-profit corporations, can be deemed to fall under the category of "juridical person" and therefore can be deemed as a business operator (para.2 of the same Article), students and universities (school corporations, etc.) who conclude an enrollment contract are consumers and business operators for the purpose of the same Act. Therefore, an enrollment contract, etc. concluded after the said Act came into force obviously falls under the category of consumer contract prescribed in para.3 of the same Article, and this is not affected by the fact that an enrollment contract has some aspects that do not go along with the principle of trade law as explained above.
Consequently, a special provision on non-return included in an enrollment contract, which should be regarded as a consumer contract, should be deemed to be a Penalty Clause.
(g) Whether a special provision on non-return is contrary to public policy
As explained above, the purpose and significance of a special provision on non-return is to avoid or compensate any loss of income from tuition fee, etc. or other tangible or intangible loss or disadvantage that universities are likely to suffer from cancellation of the enrollment contract, and such provision is also helpful in securing a sufficient number of expected students with superior academic ability at an early stage. Therefore, its reasonability cannot indiscriminately be denied. Such a special provision on non-return has been included in enrollment contracts established by most private universities over many years. Applicants who want to go to university, having recognized and understood the existence and content of a special provision on non-return based on the basic requirements, choose universities for which they participate in admission examinations of their own free will, and then decide whether or not to make payment for enrollment to the universities where they have passed admission examinations, and also decide whether or not to decline admission to the universities to which they have paid payment for enrollment, by comparing benefit and loss. Furthermore, the tuition fee, etc. and membership fee, etc. subject to a special provision on non-return are generally for the first term of the enrollment year or for the enrollment year.
Consequently, a special provision on non-return, in light of its purpose and significance, cannot be deemed to be contrary to public policy unless it is found to be significantly unreasonable in that it excessively restricts students from making free decisions to choose universities or causes other extreme disadvantages to students while enabling universities to obtain excess profits.
(h) Validity of a special provision on non-return under the Consumer Contract Act
(h.1) Under Article 9, item 1 of the Consumer Contract Act, a Penalty Clause shall be void to the extent of the amount which exceeds the "average amount of damage which... should normally be suffered by the relevant business operator in association with the consumer contract similar to such consumer contract" (hereinafter referred to as "Average Amount of Damage"). It is appropriate to construe that the Average Amount of Damage that would normally be suffered by a university upon cancellation of an enrollment contract is the amount of damage that is deemed to be generally and objectively suffered by a university when an enrollment contract with a student is cancelled. Although there is room for making some presumption based on facts, it is the student who argues that the whole or part of the special provision, a Penalty Clause, exceeds the Average Amount of Damage and is void to the extent of the amount which so exceeds that shall basically bear the burden of going forward with evidence for the Average Amount of Damage and the amount that exceeds it.
(h.2) Meanwhile, students' free decisions to choose universities must be fully respected as explained above. In fact, not all applicants who have passed a university's admission examination will actually conclude an enrollment contract, etc. with the university, and it is very uncertain whether students who have concluded an enrollment contract, etc. will actually enroll in the university. For these reasons, universities determine successful applicants, while expecting that a large number of them will not complete the enrollment procedure, or even after completing the enrollment procedure and concluding an enrollment contract, etc., will cancel it or make it lose its effect. Also, based on such expectation, universities estimate budgets and prepare human and material resources for education. Furthermore, universities hold more than one admission examination for the same faculty or department or employ various selection methods, in order to secure a sufficient number of excellent students, or take measures to offer admission to additional students to fill vacancies. Under these circumstances, even where a student has concluded an enrollment contract with a particular university and then cancels the contract, if the university has anticipated such cancellation when determining successful applicants, it cannot be said that the cancellation has caused damage to the university. Upon cancellation of an enrollment contract by a student, the university may incur unnecessary expenses for having prepared to accept the student or additional expenses for implementing administrative work again. However, such expenses can be deemed to be covered by admission fee.
Consequently, with respect to the cancellation of an enrollment contract which the university has anticipated when determining successful applicants, or in other words, the cancellation that has occurred prior to the point in time when the student can be obviously expected with high probability to enroll in the university (receive education as the university's student), it should be concluded in principle that there exists no Average Amount of Damage that would normally be suffered by the university, and the whole amount of the tuition fee, etc. and membership fee, etc. already paid by the student should basically be deemed to be beyond the Average Amount of Damage that would normally be suffered by he university.
On the other hand, with respect to the cancellation of an enrollment contract by a student that has occurred after that point in time, the university cannot be deemed to have anticipated such cancellation when determining successful applicants. In addition, universities draw up budgets for each academic year (Article 48 of the Private School Act, etc.), and it is difficult to reduce human or material resources for education or cut expenses by revising the expenditure plan based on the budget for the respective year. In general, universities prepare services to be provided for students under an enrollment contract in units of an academic year. In light of such practices, in the case of an unanticipated cancellation, it should be construed in principle that the university suffers damage equivalent to the amount of tuition fee, etc. and membership fee, etc. payable by the student for the respective year (excluding the amount corresponding to the services already provided by the university under the enrollment contract), and such damage can be deemed to be the Average Amount of Damage that would normally be suffered by the university upon the cancellation of the enrollment contract at such later point in time. Consequently, it should be concluded in principle that with respect to the tuition fee, etc. and membership fee, etc. payable for the first academic year by the student who has cancelled the enrollment contract at the later point in time, there is no part that exceeds the Average Amount of Damage that would normally be suffered by the university.
(h.3) National universities and public universities announce applicants who have passed the second admission examinations by around March 24 every year. Most private universities have announced regular successful applicants by that day, and they announce additional successful applicants by the end of March. This means that most applicants who have participated in admission examinations choose or become able to choose which university to go by the end of March, and therefore by the end of March, they can manifest the intention to cancel the enrollment contract concluded with the universities which they have not chosen. On April 1, the enrollment year begins and students who have concluded an enrollment contract with a university obtain the status of the university's student. In light of these circumstances, it is generally possible to anticipate objectively with high probability that each student enrolls in a particular university on April 1. It follows that where a student manifests the intention to cancel the enrollment contract by March 31, the day before April 1, there exists, in principle, no Average Amount of Damage that would normally be suffered by the university, and therefore the whole of the special provision on non-return should be void; on the other hand, where a student manifests the intention to cancel the enrollment contract on or after April 1, in principle, the tuition fee, etc. and membership fee, etc. already paid by the student does not exceed the Average Amount of Damage that would normally be suffered by the university if such payment is not beyond the amount payable for the first academic year, and therefore the whole of the special provision on non-return should be valid.
Where a university requires applicants to designate the university or department thereof as their only or first choice or definitely promise to enroll in the university or department, as a qualification for the university's examination for admission based on recommendation under its basic requirements for the applicants of admission examination, students who passed the examination and concluded an enrollment contract with the university can be deemed to have participated in the examination and concluded the enrollment contract after having recognized and understood the existence and content of the above-mentioned qualification for the examination. Also, such students are generally able to secure the position to enroll in the university at an earlier stage and under more favorable conditions than applicants for a regular admission examination. Therefore, it should be concluded that it is possible to anticipate objectively with high probability at the time when such students conclude the enrollment contract that they will enroll in the university. Consequently, if they cancel the enrollment contract, unless there are special circumstances where the cancellation occurs at a time when it has not yet become generally impossible for the university to easily recruit additional students to fill vacancies generated due to the cancellation by holding an additional admission examination, the university would normally suffer, due to the cancellation, an Average Amount of Damage equivalent to the amount of tuition fee, etc. and membership fee, etc. payable for the first academic year.
(i) Applicability of Article 10 of the Consumer Contract Act to a special provision on non-return, etc.
As explained above, a special provision on non-return is void under Article 9, item 1 of the Consumer Contract Act only with respect to the part concerning the amount that exceeds the Average Amount of Damage. In light of the purpose and significance of a special provision on non-return mentioned above, it is obvious that the remaining part of the special provision on non-return that is not void under the said item does not "harm the interest of the consumers one-sidedly in contravention of the basic principle provided in Article 1, para.2 of the Civil Code" as set forth in Article 10 of the same Act. Also, since the provision on payment of admission fee is a provision on consideration for obtaining the position to enroll in the university, it does not fall under the category of "any provision which, in comparison with the case applied by the provision of the Civil Code, Commercial Code and other Acts which do not relate to the public order, restricts the right of the consumer, or aggravates the duties of the consumer." Therefore, Article 10 of the Consumer Contract Act is not applicable to the provision on payment of admission fee.
(2) Examination on issues specific to this case
By applying the above-mentioned general reasoning to this case, we can make determination as follows.
(a) When the Plaintiffs paid the Payment for Enrollment in full to Defendant University and completed the enrollment procedure, the Enrollment Contracts were established between the Plaintiffs and Defendant University respectively. We cannot find any special circumstances mentioned in (1)(b).
(b) Of the Payment for Enrollment, the Tuition Fee, etc. and the Membership Fee have the nature of consideration or expenses for services to be provided by Defendant University for students under the enrollment contract, whereas the Admission Fee has the nature of consideration for obtaining the position to enroll in Defendant University, and should be deemed to be expected to be used as expenses for administrative work necessary in order for Defendant University to accept applicants who have passed the admission examination as its students. There are no reasons to regard the provision on payment of the Admission Fee as being contrary to public policy and therefore void, and Article 10 of the Consumer Contract Act is not applicable to this provision. We cannot find any circumstances that go against the principles explained in (1)(c) above or any other special circumstances.
Consequently, without needing to make determination on other points, Plaintiff X2's claim is groundless with respect to the part seeking the return of the Admission Fee.
(c) Plaintiff X2, around March 29, 2002, notified Defendant University by phone of his/her declination of admission to Defendant University, and it should be construed that by this notification, Plaintiff X2's conclusive intention to decline admission was manifested (we cannot find any provisions on declination of admission in the Basic Requirements applicable to Plaintiff X2). This is also obvious from the fact that on April 3, 2002, about five days following the notification by phone, the "Notice of Declination of Admission" sent by Plaintiff X2 arrived at Defendant University. Furthermore, we cannot find any circumstances that go against the principles explained in (1)(d) above. Consequently, the said X2's notification by phone should be regarded as a valid manifestation of intention to cancel the Enrollment Contract. Therefore, the Enrollment Contract concluded between Plaintiff X2 and Defendant University can be deemed to have been canceled around March 29, 2002.
The Enrollment Contract concluded between Plaintiff X1 and Defendant University was cancelled on March 13, as the court of the second instance determined.
(d) The part of the Special Provision on Non-Return concerning the Tuition Fee, etc. and the Membership Fee can be deemed to have the nature of a provision which liquidates in advance the amount of damages or defines the penalty upon cancellation of the enrollment contract.
(e) The Enrollment Contract is a consumer contract, and the Special Provision on Non-Return (the parts thereof concerning the Tuition Fee, etc. and the Membership Fee; the same shall apply hereinafter) is a penalty clause.
(f)(f.1) Plaintiff X1 applied for and participated in the Examination for Admission Based on Recommendation, for which it is provided as a qualification for applicants that applicants must be "persons who have strong passion for respective disciplines, a wealth of artistic talent, and future potential, and are wiling to definitely promise to enroll in the college if they pass the examination." Having passed the examination, Plaintiff X1 paid the Payment for Enrollment by the predetermined due date, December 4, 2001, and concluded the Enrollment Contract with Defendant University. This means that when the Enrollment Contract was concluded, it was possible to anticipate objectively with high probability that Plaintiff X1 would enroll in Defendant University. Therefore, unless there are special circumstances where on the day when Plaintiff X1 cancelled the Enrollment Contract, March 13, 2002, it had not become impossible for Defendant University to easily recruit additional students to fill vacancies by holding an additional admission examination, the Average Amount of Damage that would normally be suffered by Defendant University from the cancellation of the enrollment contract cannot be deemed to be below the amount equivalent to the Tuition Fee, etc. and the Membership Fee paid by Plaintiff X1. We cannot find any reasons to regard the Special Provision on Non-Return applicable to Plaintiff X1 as being contrary to public policy and therefore void. Nor can we find any reasons to hold Special Provision on Non-Return to be void under Article 10 of the Consumer Contract Act or any other reason to find its invalidity. Therefore, the whole of the Special Provision on Non-Return applicable to Plaintiff X1 can be deemed to be valid, and Defendant University is not obliged to return the Tuition Fee, etc. and the Membership Fee to Plaintiff X1.
(f.2) Consequently, the determination of the court of the second instance contains a violation of laws and regulations that apparently affects the judgment in that, without making examination regarding the special circumstances mentioned above, the court denied the existence of an Average Amount of Damage that would normally be suffered by Defendant University from Plaintiff X1's cancellation of the Enrollment Contract and found the full amount of the Tuition Fee, etc. and the Membership Fee paid by Plaintiff X1 to be exceeding such Average Amount of Damage. Of Defendant University's arguments, the one alleging this point (Reason V.2(2)(b)(D)(d) for petition for acceptance of appeal) is well-grounded, whereas other arguments are groundless to the extent that they contravene the above reasoning. The original judgment should inevitably be quashed with respect to the part dismissing the appeal to the court of the second instance filed by Defendant University against Plaintiff X1.
(g)(g.1) Plaintiff X2 cancelled the Enrollment Contract around March 29, 2002, before March 31, and we cannot find any circumstances that go against the principles explained in (1)(h) above. Therefore, at that point of time, it was impossible to anticipate objectively with high probability that Plaintiff X2 would actually enroll in Defendant University. Consequently, Plaintiff X2's cancellation of the Enrollment Contract does not cause any Average Amount of Damage that would normally be suffered by Defendant University, and this means that the full amount of the Tuition Fee, etc. and the Membership Fee paid by Plaintiff X2 should be deemed to be exceeding the Average Amount of Damage, and therefore the whole of the Special Provision on Non-Return applicable to Plaintiff X2 should be void. It follows that Defendant University is obliged to return the Tuition Fee, etc. and the Membership Fee to Plaintiff X2.
(g.2) Consequently, the determination of the court of the second instance contains a violation of laws and regulations that apparently affects the judgment in that the court denied the validity of the cancellation of the Enrollment Contract as of around March 29, 2002, holding that a notification of declination of admission not made in writing cannot be deemed to be a valid manifestation of the intention to cancel an enrollment contract, and based on the determination that the enrollment contract was cancelled on April 3, 2002, dismissed Plaintiff X2's claim with respect to the part seeking return of the Tuition Fee, etc. and the Membership Fee. Of Plaintiff X2's arguments, the one alleging this point (Reason III for petition for acceptance of appeal) is well-grounded, whereas other arguments are groundless to the extent that they contravene the above-mentioned reasoning. The original judgment should inevitably be quashed with respect to the part dismissing Plaintiff X2's claim to seek refund of the Tuition Fee, etc. and the Membership Fee.

III. Conclusion
For the reasons stated above, regarding Plaintiff X1's claim, based on the appeal to the court of the last resort filed by Defendant University, the original judgment is quashed with respect to the part dismissing the appeal to the court of the second instance filed by Defendant University against Plaintiff X1 (the part upholding Plaintiff X1's claim to seek refund of the Tuition Fee, etc. and the Membership Fee), and for further examination, this case is remanded to the court of the second instance with respect to said part. Regarding Plaintiff X2's claim, the judgment of the first instance upholding Plaintiff X2's claim to seek refund of the Tuition Fee, etc. and the Membership Fee is appropriate, and therefore, based on the appeal to the court of the last resort filed by Plaintiff X2, the original judgment is quashed with respect to the part rescinding the judgment of the first instance based on the appeal to the court of the second instance filed by Defendant University against Plaintiff X2, the appeal to the court of the second instance filed by Defendant University with respect to said part is dismissed, and the remaining part of Plaintiff X2's appeal to the court of the last resort is dismissed.

Therefore, the judgment has been rendered in the form of the main text by the unanimous consent of the Justices.

Justice FURUTA Yuki
Justice TAKII Shigeo
Justice TSUNO Osamu
Justice IMAI Isao
Justice NAKAGAWA Ryoji