Private school parents denied refund of €2,800 deposit

The family of two private school students have been denied the full refund of their €2,800 contributory deposit, after a court disputed the ‘automatic’ nature of the intended refund.

The Farrugia family insisted that their contribution fees to the San Andrea School for the induction of their two sons, should have been refunded as agreed in the enrolment contract.

The San Andrea School, which belongs to the Parents Foundation for Education, had laid down in 1988 a contribution fee that was to be refundable, but with a proviso that it would be the same Foundation to determine when such refunds are made, as well as the method of such refund – and of course, without any interest in favour of the contributor.

In 1993, the rules were updated by providing that the contributions would only be refunded from the pool of contributions from newer students and then “only when the Foundation has, in its sole discretion, completed the necessary capital investment programme in any school. Refunds of Contributions shall be financed from the new Contributions committable to that same school.”

Again in 1998, the rules were once again changed to issue such refunds only to contributors whose first registered child was born on 1 January 1998, or after.

The Farrugias demanded they be refunded their contributions, which at the time of registration, amounted to Lm600 for each student (around €1,380 each).

But the Small Claims Tribunal decreed that these contributions were only refundable under the conditions of the school contract with parents, which appears to give full discretion to the school administrators when to issue the refund.

It transpires that the agreement itself does not state unequivocally when the contributions will be refunded. “In this case, the Foundation has not stated when it would be able to, or when it would have the means to carry out the refunds.... once the parties have decided to bind themselves with an agreement, neither party can of its own will decide that such agreement no longer suits it, because that goes against the bona fide spirit that both sides must apply in a binding contract,” the Tribunal ruled.