notified promptly that it was never an eligible institution under section 1141(a)(5)(B) because the three listed students never enrolled at Touro College. In addition, the ED requested that plaintiff repay the student aid funds disbursed subsequent to this mistaken certification. Plaintiff asserts a property interest in the funds it received and claims that the sudden revocation of its eligible institution status without an opportunity for a hearing was a violation of its due process rights.
The determination that plaintiff failed to satisfy the definition of the term "institution of higher education" is not a "termination" requiring a "hearing on the record" as called for in section 1094(b)(1)(D); see also 34 C.F.R. § 668.71(c)(1) (no right to notice and hearing for failure to meet eligibility requirements of section 1141). Nevertheless, Beth Rochel officials did meet with ED officials who entertained several appeals concerning Beth Rochel's loss of eligibility and liability. Supra slip op. at 8-9.
The Court finds the application and verification forms issued by the ED in October 1980, were somewhat unclear in setting out the requirements for 3IC eligibility. The Court also notes that ED officials were concerned enough to clarify later 3IC verification forms to note expressly the requirement that transfer students enroll and attend classes. See Plaintiff's Exhibits 13, 18, 19. None of this, however, provides plaintiff any defense. Significantly, plaintiff had applied for 3IC eligibility once before, in 1979, and was rejected for the same reason that plaintiff's eligibility was revoked in 1981. In 1979, the ED was advised that the three students who were listed as having transferred to Hofstra University never enrolled there. Supra slip op. at 6.
Plaintiff had been through the 3IC process once before and was familiar with the various forms and requirements. Beth Rochel's 3IC eligibility was rejected by the ED for the same reason in 1981 as in 1979. It is clear, therefore, that there is no basis to plaintiff's claims that defendants acted arbitrarily and capriciously in retroactively imposing new eligibility requirements on Beth Rochel. The ED acted in accordance with section 1141(a)(5)(B), 34 C.F.R. § 668.2(a)(5)(iv), and the August 20, 1979, rule on both occasions.
The Constitution does not require a hearing where there is no dispute of fact to decide. Codd v. Velger, 429 U.S. 624, 51 L. Ed. 2d 92, 97 S. Ct. 882 (1977) (per curiam). There is no dispute as to the critical facts of this case. Plaintiff admits that none of the three students it listed in its October 1980 3IC application actually transferred and enrolled in Touro College. Plaintiff's Statement para. 13. Plaintiff was never in compliance with section 1141(a)(5)(B), 34 C.F.R. 668.2(a)(5)(iv), and the August 20, 1970, rule and, accordingly, never had a right to receive student financial aid funds under the HEA. Plaintiff must return the mistakenly disbursed student financial aid funds to the ED. An order is attached.
Upon consideration of plaintiff's motion for summary judgment; defendants' opposition thereto and cross-motion for summary judgment; plaintiff's reply and opposition to defendants' motion; defendants' reply; affidavits; exhibits; supplemental materials; and the oral argument in this matter, it is by the Court this 19th day of December 1985,
ORDERED that plaintiff's motion for summary judgment is denied; it is further
ORDERED that defendants' motion for summary judgment is granted; it is further
ORDERED that plaintiff repay defendants the sum of $52,268.00, plus interest at the rate of 11 percent from August 17, 1983, pursuant to 31 U.S.C. § 3717, to date of judgment and from the date of judgment at the legal rate until paid, plus costs; and it is further
ORDERED that this action is dismissed.