Armstrong v. Clarkson College, 297 Neb. 595

Background

Armstrong was a student in Clarkson College’s CRNA (nurse anesthesia) program; after attending an AANA conference she was placed on clinical probation and then administratively withdrawn when her primary clinical site (UNMC) refused to accept her back.
Clarkson’s program materials included multiple handbooks; some expressly disclaimed contractual obligations or reserved unilateral amendment; the CRNA handbook incorporated the AANA Code of Ethics and contained a grievance procedure and probation/dismissal rules.
Clarkson told Armstrong it would make a “reasonable attempt” to place her at an alternative clinical site if UNMC would not allow her to return; Clarkson contacted other sites but none accepted her, and Clarkson administratively withdrew Armstrong rather than dismissing her.
Armstrong sued for breach of contract and won a $1,000,000 jury verdict. Clarkson appealed, raising directed-verdict, evidentiary, and jury-instruction errors (including failure-to-exhaust/grievance, impossibility/impracticability, and mitigation instructions).
The district court excluded evidence of a prior alleged plagiarism incident and refused several Clarkson proffered instructions; the Nebraska Supreme Court reversed and remanded for a new trial because the court erred by refusing to instruct the jury on Armstrong’s alleged failure to fulfill a condition precedent (exhaustion of Clarkson’s grievance procedure).

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Clarkson was entitled to directed verdict because its actions were protected by academic deference	Armstrong: jury could find Clarkson breached an implied contract (ongoing duty to provide clinical placement); academic deference not applicable to failure to provide a clinical site	Clarkson: academic judgments entitled to deference; no arbitrary/capricious action; thus judgment as a matter of law	Denied directed verdict; jury question existed because failure to provide clinical site was not an academic judgment entitled to deference under these facts
Admissibility of evidence about prior alleged plagiarism	Armstrong: such evidence is unfairly prejudicial and minimally probative	Clarkson: plagiarism was part of the res gestae of its decision to discipline/withdraw Armstrong	Admission excluded; court did not abuse discretion because probative value was low and unfair prejudice high
Whether jury should have been instructed that Armstrong failed to fulfill a condition precedent by not exhausting Clarkson’s grievance procedure	Armstrong: exhaustion doctrine inapplicable to private entity or grievance not a contract term; substantial-performance instruction sufficed	Clarkson: grievance procedure was a mandatory, contract-based condition precedent; failure to exhaust bars suit	Reversible error to refuse instruction—exhaustion can be a contractual condition precedent for private institutions and jury must decide whether the grievance procedure was a contract term or an exception applied
Whether Clarkson was entitled to instruction on impossibility (impracticability) and mitigation of damages	Armstrong: impossibility inapplicable; mitigation unreasonable to require re-enrollment or out-of-state relocation	Clarkson: clinical sites’ refusals made performance impossible; Armstrong could have mitigated by reapplying elsewhere	Court correctly refused impossibility instruction (events not unexpected; Clarkson did not reasonably attempt to enforce agreements) and correctly refused mitigation instruction (evidence showed mitigation would be unreasonable/impracticable for Armstrong)

Key Cases Cited

Winder v. Union Pacific R.R. Co., 296 Neb. 557 (standards for directed verdict and review)
Doe v. Board of Regents, 283 Neb. 303 (academic judgments entitled to deference in some university breach-of-contract claims)
McGuire v. Continental Airlines, Inc., 210 F.3d 1141 (exhaustion of employer grievance procedure required before suit)
Neiman v. Yale Univ., 270 Conn. 244 (exhaustion of internal academic grievance procedures in private university context)
Lucero v. UNM Bd. of Regents, 278 P.3d 1043 (exhaustion of handbook grievance required before judicial contract claim)