Armstrong v. Clarkson College, 297 Neb. 595

Background

Armstrong was a Clarkson College CRNA student who completed didactic work and entered clinical rotations; after attending an AANA conference she was placed on clinical probation and then administratively withdrawn when clinical sites refused to take her back.
Clarkson’s program/student handbooks contained disclaimers that many provisions were not contractual; Clarkson nevertheless acknowledged a duty to provide clinical placements and told Armstrong it would make a reasonable attempt to reassign her if UNMC refused to accept her.
After UNMC and other affiliated clinical sites refused to accept Armstrong, Clarkson administratively withdrew her rather than dismissing her; Armstrong sued for breach of contract and obtained a $1 million jury verdict.
At trial Clarkson sought jury instructions on (a) failure to exhaust the college’s grievance procedure (condition precedent), (b) impossibility/impracticability of performance, and (c) mitigation of damages; the district court refused all three and excluded evidence of alleged prior plagiarism.
The Nebraska Supreme Court reversed and remanded for a new trial because the court erred in refusing Clarkson’s instruction that Armstrong’s failure to exhaust the internal grievance procedure could be a condition precedent to suit; the court upheld exclusion of plagiarism evidence and refusal of impossibility and mitigation instructions.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether directed verdict should have been granted because Clarkson’s actions were academic judgments entitled to deference	Armstrong: jury could find Clarkson breached an ongoing duty to provide clinical placement; academic deference not applicable to failure to provide site	Clarkson: academic deference insulated its disciplinary/placement decisions from contract liability; no arbitrary or capricious action	Denied directed verdict; jury could find an implied ongoing contractual duty to provide clinical placement and no deference applied to failure to secure a site
Admissibility of alleged prior plagiarism	Armstrong: plagiarism evidence irrelevant and unfairly prejudicial under Neb. Evid. R. 403	Clarkson: plagiarism was part of res gestae for discipline and withdrawal	Evidence excluded; court did not abuse discretion because probative value was minimal and risk of unfair prejudice great
Whether failure to exhaust Clarkson’s internal grievance procedure was a condition precedent barring suit	Armstrong: exhaustion doctrine inapplicable to private college or grievance not required	Clarkson: grievance procedure was mandatory part of contractual scheme and exhaustion is a condition precedent	Reversed district court: jury must be instructed on condition-precedent/exhaustion because instruction was correct, warranted by evidence, and its omission prejudiced Clarkson
Whether impossibility (impracticability) or failure-to-mitigate instructions should have been given	Armstrong: impracticability not applicable; mitigation unreasonable due to nontransferability/cost	Clarkson: clinical sites’ refusals made performance impossible; Armstrong could have mitigated by reapplying elsewhere	Court affirmed refusal of both instructions: impracticability was unwarranted (event was foreseeable; Clarkson didn’t enforce agreements) and mitigation was unwarranted (reapplication/relocation was unreasonable and likely unaffordable for Armstrong)

Key Cases Cited

Winder v. Union Pacific R.R. Co., 296 Neb. 557 (review standard for directed verdict and evidence)
Doe v. Board of Regents, 283 Neb. 303 (academic deference in breach of contract suits)
McGuire v. Continental Airlines, Inc., 210 F.3d 1141 (10th Cir. 2000) (internal grievance procedures must be exhausted before suit)
Neiman v. Yale University, 270 Conn. 244 (Conn. 2004) (exhaustion doctrine applies to private academic grievance procedures)
Lucero v. UNM Bd. of Regents, 278 P.3d 1043 (N.M. Ct. App. 2012) (employee must exhaust handbook grievance before contract suit)