On April 26, 2024, the Texas Supreme Court in case number 23-0565 answered “No” to the following certified question presented by the 5th Circuit in the case of Luke Hogan, on Behalf of Himself and Other Individuals Similarly Situated v. Southern Methodist University, and Other Affiliated Entities and Individuals, 74 F.4th 371 (5th Cir. 2023).
Does the application of the Pandemic Liability Protection Act to Hogan’s breach-of-contract claim violate the retroactivity clause in article I, section 16 of the Texas Constitution?
Essentially, Hogan sued SMU for breach of contract for his loss of what he believed was a reasonable expectation of in-person education arising from SMU forcing remote education during the COVID-19 pandemic that began in 2020. For the spring 2020 semester, Hogan paid roughly $28,000 in tuition and fees, and after moving classes online, SMU did not refund any of those amounts.
In response to the claims, SMU asserted that the Pandemic Liability Projection Act (“PLPA”), which was enacted on June 14, 2021. The PLPA provides that “[a]n educational institution is not liable for damages or equitable monetary relief arising from a cancellation or modification of a course, program, or activity of the institution if the cancellation or modification arose during a pandemic emergency and was caused, in whole or in part, by the emergency.” Tex. Civ. Prac. & Rem. Code § 148.004(b).
Hogan, on the other hand, asserted that the PLPA could not be used to bar his claims because the PLPA was enacted after Hogan was allegedly harmed by SMU’s remote education program was installed. Hogan based his theory on the Texas Constitution, article I, section 16 which, pursuant to ratification made at a legislative convention in 1876, states in relevant part: “No . . . retroactive law, or any law impairing the obligation of contracts, shall be made.” Tex. Const. art. I, § 16 (emphasis added).
The Texas Supreme Court was tasked to explain the “unexplained prohibition on ‘retroactive law[s]’ as that phrase is used in article I, section 16 of the Texas Constitution. In colorful fashion (which is well-worth a read), the Court acknowledged the complex nature of what is the Texas Constitution, noting that “this Court’s varied precedents on retroactivity came to resemble a tangled wad of Christmas lights pulled from the attic after Thanksgiving.” (Slip opin. 8-9).
After colorfully discussing the history of the “no retroactive laws” provision in article I, section 16 of the Texas Constitution, the Texas Supreme Court concluded as follows:
“Elementary considerations of fairness dictate that individuals should have an opportunity to know what the law is and to conform their conduct accordingly[.]” “In other words, the rules should not change after the game has been played.” Id. In Hogan’s case, there were no settled rules governing a student’s ability to recover damages from a university when the government forces the school to move online during a pandemic. That game had never been played before. The PLPA created new rules governing novel litigation in the wake of a novel and previously unimaginable event. Article I, section 16’s prohibition on “retroactive law[s]” is not violated by the application of the PLPA to bar Hogan’s breach-of-contract claim against SMU.
For these reasons, the answer to the certified question is No.
(Slip opin. at pg. 21) (internal citations omitted).
Notably, the Fifth Circuit did not certify a question to the Texas Supreme Court with regard to the portion of article I, section 16 of the Texas Constitution that provides “No . . . law impairing the obligation of contracts, shall be made.” Thus, the Texas Supreme Court provided no comment on that. (Slip. opin. at pg. 8 fn. 5).
The Texas Supreme Court’s opinion may be viewed here.
