Thursday, 30 June 2022

Are Private Universities and Colleges Really Private?

 Abbreviations used in this article

Act 555 - Private Higher Educational Institutions Act 1996

EA – Education Act 1996

PHEI - private higher educational institution

UUCA - Universities and University Colleges Act 1971 (Act 30)

 

The Question

Are private universities and colleges established under Act 555 private, in the sense that they are not government institutions? Or are they hybrid institutions, established and funded by private companies but controlled and managed by the government through the office of the Registrar General of Private Higher Educational Institutions? These are not idle questions but arise from provisions of the Act that deal with the management of private higher educational institutions (PHEIs). The  answers to the questions may have far-reaching implications on who bears the responsibility for breaches of duty and other failures by the institution.

Act 555

The Act enables the establishment of a higher education institution by almost anyone, so long as the application to establish is made by a registered company, local or foreign, and in accordance with the establishment procedures laid down in the Act. The Act defines PHEIs to include all levels and types of higher education institutions, from colleges to universities, irrespective of size and regardless of their mode of delivery, whether by traditional face-to-face methods, online, or by distance education and includes universities established in this country as branches of foreign universities. The single definition also embraces within its scope, professional bodies that offer courses leading to membership in those bodies. The Private Higher Educational Institutions (Amendment) Act 2017 added two new definitions to the Act. A foreign branch campus is now defined as a branch of a foreign university or university college. College, which was a term that was not defined before the passing of the Amendment Act, is now defined as a PHEI without the status of a university, university college, or foreign branch campus.

When passed in 1996, the Act made ground-breaking changes to the way higher education has since developed in this country. Its most important contribution to that development is the establishment of a framework for private higher education institutions that had the immediate effect of legitimising an already vibrant private sector that had existed for many decades without any roots in any enabling laws.

The Company and the PHEI it establishes

Institutions established under the Act are private because they are defined, inter alia, ‘as not established or maintained by the government’. The definition, does not, however, stipulate where control and governance of these institutions lie. A reasonable assumption would be that the PHEI is managed and controlled by the company that established the institution. But such an assumption is not supported by the provisions of the Act. Instead, many provisions of the Act treat the PHEI as if it is a legal entity capable of acting on its own with powers of its own and without the agency of the company. Every imposition in the Act that in any way concerns the delivery of educational programmes is directed at the PHEI and not the company. It is doubtful whether these provisions as currently worded can be enforced against the company which is the legal entity carrying out the business of higher education. The statutory impositions on a PHEI must be imposed on the company that established the PHEI and not on the PHEI which does not have the capacity to do anything in law. The error in the Act probably arises because of the assumption that a PHEI is like a university established under the UUCA, which is an incorporated body.

The attempt to correct the anomaly

The Amendment Act 2017, attempted to correct the anomaly by introducing a new section 75A, which provides that ‘Where the Act requires a private higher educational institution to do or prohibits it from doing something, the obligation to comply is imposed on the company . . .’ This is at best only a limited solution as it still treats the company and the PHEI as two separate entities. It is also unlikely that the section will be enforceable because a PHEI, not being a legal entity, cannot be required or prohibited from doing anything. Hence, the company establishing the PHEI cannot be made liable to do something which cannot be done.

The Chief Executive

Section 31 of the Act requires every PHEI to have a chief executive appointed by the company. Section 33 provides that the chief executive is to exercise general supervision over arrangements for instruction, day-to-day administration, and the welfare and discipline in the PHEI.  Under s. 46 of the Act, the chief executive is also the disciplinary authority over student discipline. In all these matters concerning the powers/duties of the chief executive, the Act makes no reference to the company or its rights or obligations over those same powers that the chief executive is empowered to exercise.

An ordinary interpretation of the sections referred to will make the chief executive the sole governor and administrator of the PHEI. Section 46 confers on the Chief Executive the right to delegate his disciplinary authority, but he is not given any delegatory powers in respect of his other duties/powers. The prescribed constitutions allow for the board of directors of the company to be included in the management, but notwithstanding that, the statutory powers of the chief executive are not ousted by those provisions. There is also nothing in the Act to make the Chief Executive answerable to the board of directors of the company nor is there any provision that gives the board powers over the chief executive. When the chief executive is in a quandary as to who to obey, he will have no choice but to comply with the statute.

The PHEI as a separate entity

We earlier remarked on the position of the company as the animating legal entity, but the Act is ambivalent on that point treating the company and the PHEI as separate entities. The sections in the Act that treats the PHEI as separate from the company might also support a conclusion that in law that it is the Minister, Ministry, and the Registrar General who are responsible for the proper management of the PHEI.

Minister’s and Registrar General’s powers over the chief executive

Such a conclusion is strengthened by the provisions of section 5 of the Act. The section states that (the) Minister may, from time to time, give a board of directors, a chief executive, or an employee of a PHEI directions, not inconsistent with the provisions of this Act, in relation to matters in respect of which regulations may be made under this Act, and such board of directors, chief executive or employee shall give effect to every such direction. 

To add to the confusion and the unenviable position of the chief executive, s. 37 of Act 555, gives the Registrar General wide powers over the chief executive which include, giving the chief executive directions in writing as to the exercise of the latter’s powers and the discharge of his duty.

Registrar General’s Responsibilities over PHEIs

Part VI of the Act, and the sections dealing with the chief executive specifically, suggest that the Registrar General is duty-bound to monitor the conduct of the chief executive and give him the appropriate directions. Read together, these provisions appear to impose on the Registrar General not only the power of overseeing the management of PHEIs but also a duty to ensure its proper management. Any failure in that duty may therefore impose on the Registrar General liability for any loss suffered by the shareholders.

Act 555 in an attempt to maintain control PHEIs, may have imposed unintended liability on the Registrar General and the Ministry for the failures of the chief executive and the company establishing the PHEI.

There is an urgent need to reevaluate Act 555 as it now stands.