Dieckhaus v. Bd. of Governors of The Univ. of N.C.

• Court: Court of Appeals of North Carolina
• Decided: January 17, 2023
• Docket: 21-797
• Status: Published

Opinion

IN THE COURT OF APPEALS OF NORTH CAROLINA

2023-NCCOA-1

No. COA21-797

Filed 17 January 2023

Orange County, No. 20CVS564

DEENA DIECKHAUS, GINA MCALLISTER, BRADY WAYNE ALLEN, JACORIA STANLEY, NICHOLAS SPOONEY and VIVIAN HOOD, each individually and on behalf of all others similarly situated, Plaintiffs,

v.

BOARD OF GOVERNORS OF THE UNIVERSITY OF NORTH CAROLINA, Defendant.

Appeal by plaintiffs from order entered 17 June 2021 by Judge Edwin G.

Wilson, Jr. in Superior Court, Orange County. Heard in the Court of Appeals 10 May

2022.

Anastopoulo Law Firm, LLC, by Blake G. Abbott, for plaintiffs-appellants.

Brooks, Pierce, McLendon, Humphrey & Leonard, LLP, by Jim W. Phillips, Jr. and Jennifer K. Van Zant, and Attorney General Joshua H. Stein, by Special Deputy Attorneys General Laura McHenry and Kari R. Johnson, for defendant- appellee.

STROUD, Chief Judge.

¶1 Plaintiffs Deena Dieckhaus, Gina McAllister, Brady Wayne Allen, Jacoria

Stanley, Nicholas Spooney, and Vivian Hood appeal an order granting Defendant

Board of Governors of the University of North Carolina’s Motion to Dismiss Plaintiffs’ DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

Opinion of the Court

Amended Complaint. The Amended Complaint included both contract and unjust

enrichment claims. Because sovereign immunity bars the unjust enrichment claims

and because statutory immunity bars both the unjust enrichment and contract

claims, we affirm the trial court’s order dismissing all claims.

I. Background

¶2 Since this case is at the pleading stage, we rely upon the facts as alleged in

Plaintiffs’ Amended Complaint.1 Defendant is the Board of Governors for the

University of North Carolina System, and that System includes 17 “constituent

institutions throughout the State” (collectively “Universities”). “As a precondition for

enrollment” for the Spring 2020 Term, Defendant required students planning to

attend the Universities to pay tuition. When charging tuition, Defendant charged

students different rates depending on which of two types of programs the students

chose, an “in-person, hands-on program[]” and a “fully online distance-learning

program[.]” In addition to the differential pricing, Defendant marketed the two

programs differently through its and the Universities’ “website[s], academic

catalogues, student handbooks, marketing materials and other circulars, bulletins,

1 We focus on the Amended Complaint because the order on appeal ruled on Defendant’s Motion to Dismiss the Amended Complaint. On 22 May 2020, Plaintiffs filed their original Complaint. On 14 August 2020, Defendant filed a Motion to Dismiss the Complaint. Before that motion was heard, Plaintiffs filed their Amended Complaint on 30 December 2020, as discussed more below. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

and publications” that differentiate between “fully online” programs and “non-online”

programs with “references to and promises about the on-campus experience[.]”

¶3 Plaintiffs here all paid tuition and enrolled in the in-person program for the

Spring 2020 Term, with one exception. Plaintiffs Dieckhaus, McAllister, Allen,

Stanley, and Spooney all enrolled as undergraduates in different Universities in the

system. Plaintiff Hood paid tuition to enroll her daughter at one of the Universities’

campuses for the Spring 2020 Term.

¶4 Beyond the tuition students paid to enroll, they paid additional fees.

Defendant charged students, including Plaintiffs, “certain mandatory student fees.”

In Defendant and its Universities’ “publications” including “catalogs” and

“website[s],” Defendant “specifically describe[d] the nature and purpose of each fee.”

The student fees paid by students were then “intended by both the students and

Defendant to cover the services, access, benefits and programs for which the fees were

described and billed.” Plaintiffs paid all applicable fees for the Spring 2020 Term.

Finally, a certain subset of students, including Plaintiffs McAllister, Spooney, and

Hood paid additional fees “for the right to reside in campus housing and for access to

a meal plan providing for on campus dining opportunities.”

¶5 Plaintiffs and other students started the Spring 2020 Term with on-campus,

in-person education and with access to the services for which they paid student fees,

housing fees, and on-campus meal fees. “On or about March 11, 2020, in response to DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

the COVID-19 pandemic, Defendant issued a system-wide directive to all” the

Universities “requiring that they transition from in-person to online instruction no

later than March 23, 2020.” As a result, starting on 23 March 2020 through the end

of the Spring 2020 Term, “there were no in person classes at” the Universities, “and

all instruction was delivered online.” Another directive from Defendant to all the

Universities “[o]n or about” 17 March 2020 “instruct[ed] students living in campus

housing to remain at or return to their perme[n]ant residences.” As a result of this

directive, the Universities closed their on campus residences and prevented student

access to dining facilities. The campus shutdowns also meant students “no longer

ha[d] the benefit of the services for which” they paid student fees. Defendant

“announced” it would be offering “pro-rated credits or refunds for students who pre-

paid housing and meal costs for the Spring 2020” Term—and did offer some refunds—

but it did not offer refunds for tuition or student fees.

¶6 Based on these alleged facts, Plaintiffs filed their Amended Complaint on 30

December 2020. The Amended Complaint includes both breach of contract claims

and unjust enrichment claims seeking “refunds . . . on a pro-rata basis” for “tuition,

housing, meals, [and student] fees . . . that Defendant failed to deliver for the second

half of the Spring 2020” Term after shutting down the Universities’ campuses in

response to COVID-19. As to all these claims, the Amended Complaint alleges the

General Assembly “has explicitly waived sovereign immunity in suits against DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

Defendant” because Defendant “is a body politic” that is, inter alia, “capable in law to

sue and be sued in all courts whatsoever.” The Amended Complaint also asserts

Plaintiffs “bring this action on behalf of themselves and as a class action” on behalf

of four classes for each of the four categories of payments: tuition, fees, on-campus

housing, and on-campus meals. As a result, the Amended Complaint includes “Class

Action Allegations[,]” (capitalization altered), but the class action component of the

lawsuit is not at issue in this appeal.

¶7 As to the tuition breach of contract claim, the Amended Complaint alleges

Defendant offered to Plaintiffs and the proposed class its on-campus “live, in-person

education” for the Spring 2020 Term in contrast to its “separate and distinct” online-

only educational program. In addition to the descriptions through online and written

materials discussed above, Defendant and its Universities differentiated between the

two programs with respect to the Spring 2020 Term specifically by differences in how

students registered for on-campus versus online instruction and “the parties’ prior

course of conduct” in starting classes “for which students expected to receive in-

person instruction” with such instruction and with class materials with in-person

“schedules, locations, and . . . requirements.” Plaintiffs and the proposed class then

“accepted that offer by paying tuition and attending classes during the beginning of

the Spring 2020” Term. The Amended Complaint alleges Defendant then breached

the contract by shutting down its campuses and shifting “all classes” to online DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

learning “without reducing or refunding tuition accordingly.” Finally as to this claim,

the Amended Complaint states “[t]his cause of action does not seek to allege

‘educational malpractice’” but instead focuses on how “Defendant provided a

materially different product,” online learning, from the one Plaintiffs and the

proposed class paid for, “live[,] in-person[,] on-campus education[.]” As a result of

this breach, Plaintiffs allege they suffered damages “amounting to the difference in

the fair market value of the services and access for which they contracted, and the

services and access which they actually received.”

¶8 The Amended Complaint also alleges a breach of contract claim for student

fees. Defendant and its Universities offered “services, access, benefits and programs”

by “specifically describ[ing] the nature and purpose of each fee” in “publications,” in

particular in “catalogs . . . and website[s.]” Plaintiffs and the proposed fees class then

accepted the terms and paid the fees, thereby forming a contract. The Amended

Complaint alleges Defendant then breached the contract by shutting down the

Universities’ campuses and “cancelling most student activities” halfway through the

Spring 2020 Term—thereby not providing “recreational and intramural programs;

fitness centers or gymnasiums; campus technology[,] infrastructure[,] or security

measures; or Spring intercollegiate competitions”—without giving students any

“discount or refund” on “any fees” as Defendant does for “fully online students[.]” As

a result of Defendant’s breach, Plaintiffs and the rest of the proposed class suffered DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

damages.

¶9 The Amended Complaint includes two final breach of contract claims for on-

campus housing and meals. The Amended Complaint alleges Defendant offered the

relevant Plaintiffs and proposed classes “on-campus housing” and “meals and on-

campus dining options” in return for additional fees. The relevant Plaintiffs and

proposed class members then accepted by paying those fees. When the Universities

shut down their campuses, they “requir[ed] students to move out of on-campus

housing facilities” and closed “most campus buildings and facilities, including dining

facilities[,]” thereby breaching the contract. Defendant then “issued arbitrary and

insufficient refunds” for on-campus housing and meals for most students because the

campus shutdowns started earlier than the date applied to pro-rate the refunds.

According to the Amended Complaint, the relevant Plaintiffs and proposed class

members suffered damages for the additional amounts they should have been

refunded.

¶ 10 In the alternative to each of the four breach of contract claims, the Amended

Complaint alleges unjust enrichment claims. Each of the claims follows a similar

pattern. The Amended Complaint alleges Plaintiffs and the proposed class “conferred

a benefit” non-gratuitously on Defendant by paying the relevant tuition or fees, and

Defendant “realized this benefit by accepting such payment.” Plaintiffs and the class

members did not receive “the full benefit of their bargain[,]” i.e. the services and DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

benefits they paid for, but Defendant “retained this benefit” unjustly. The Amended

Complaint then alleges “[e]quity and good conscience require” Defendant “return a

pro-rata portion of the monies paid” as tuition or the relevant fees, especially

considering the money Defendant and its Universities saved by operating online

rather than in-person, their “billions of dollars in endowment funds,” and the

“significant aid from the federal government” Defendant received. Finally, the claims

request Defendant “be required to disgorge this unjust enrichment[.]”

¶ 11 On 15 January 2021, Defendant filed a “Motion to Dismiss [the] Amended

Complaint” under Rules of Civil Procedure 12(b)(1), 12(b)(2), and 12(b)(6) based on

five grounds. (Capitalization altered.) First, Defendant argued Plaintiffs’ claims

were barred by N.C. Gen. Stat. § 116-311, which is part of Article 37 entitled “An Act

to Provide Immunity for Institutions of Higher Learning.” Next, Defendant

contended Plaintiffs’ claims were “barred by sovereign immunity.” According to

Defendant, Plaintiffs also failed to state claims for relief for breach of contract and

unjust enrichment, including on the grounds that the Amended Complaint was “an

attempt to assert a claim for educational malpractice which is not a cognizable claim

under North Carolina state law.” Then, Defendant argued the Amended Complaint

failed to allege “damages were proximately caused by Defendant.” Finally, Defendant

contended Plaintiffs lacked standing because they “failed to allege a sufficient injury

and they purport to allege claims against [U]niversities with whom they had no DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

relationship.”

¶ 12 The trial court held a hearing on Defendant’s Motion to Dismiss on 19 May

2021. At the hearing, Defendant discussed each argument raised in its Motion to

Dismiss. When discussing statutory immunity under North Carolina General

Statute § 116-311, the parties argued about both the applicability and

constitutionality of the statute. Plaintiffs argued the statute was unconstitutional on

a number of grounds, including “the federal contracts clause.”2 In addition to arguing

Plaintiffs had failed to show § 116-311 was unconstitutional on the merits, Defendant

argued Plaintiffs were making a facial constitutional challenge to the statute but had

not followed the correct procedure to make such a challenge so Plaintiffs had “waived

their right to challenge the statute.” Plaintiffs repeatedly argued they were not

raising a facial challenge but instead were making an as-applied challenge to the

constitutionality of § 116-311. The trial court ended the hearing without making a

ruling on Defendant’s Motion to Dismiss or any discussion of whether Plaintiffs were

making an as-applied or facial challenge to §116-311.

2Our record does not include information about all the grounds on which Plaintiffs argued § 116-311 was unconstitutional. The transcript only includes this reference to “the federal contracts clause[,]” an argument “this law was passed specifically because of this case[,]” and a couple other references to impairing contracts in violation of the federal Constitution. Based on the transcript, the parties filed briefing on Defendant’s Motion to Dismiss, but we do not have those briefs in our record. As a result, we do not know the details of Plaintiffs’ arguments before the trial court as to the unconstitutionality of § 116-311. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

¶ 13 On 17 June 2021, the trial court entered an order granting Defendant’s Motion

to Dismiss without specifying the grounds for that decision. On 15 July 2021,

Plaintiffs filed a written notice of appeal from the order granting Defendant’s Motion

to Dismiss.

II. Analysis

¶ 14 On appeal, Plaintiffs argue, “The trial court erred in granting Defendant’s

Motion to Dismiss because Plaintiffs adequately plead claims for breach of a contract

and unjust enrichment.” (Capitalization altered.) As part of this overarching

argument, Plaintiffs make five contentions. First, Plaintiffs argue they “state[d] a

claim for breach of contract.” (Capitalization altered.) Plaintiffs also argue they

“state[d] a claim for unjust enrichment.” (Capitalization altered.) Third, Plaintiffs

assert “Defendant is not entitled to sovereign immunity.” (Capitalization altered.)

Plaintiffs then contend “N.C. Gen. Stat. § 116-311 is unconstitutional and

inapplicable to this action.” (Capitalization altered.) That statute grants

“institution[s] of higher education . . . immunity from claims” for “tuition or fees paid

. . . for the spring academic semester of 2020” when the claims “allege[] losses or

damages arising from an act or omission by the institution of higher education during

or in response to COVID-19, the COVID-19 emergency declaration, or the COVID-19 DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

essential business executive order.”3 N.C. Gen. Stat. § 116-311(a) (2021). Finally,

Plaintiffs argue they “hav[e] standing on all claims.” (Capitalization altered.)

¶ 15 We will address Plaintiffs’ contentions as to why the trial court erred in

granting Defendant’s Motion to Dismiss in the following order. First, we will address

the immunity issues—both sovereign immunity and the potential statutory immunity

of N.C. Gen. Stat. § 116-311—because of the special nature of immunity as more than

“just a mere defense in a lawsuit” in comparison to other defenses raised under Rule

of Civil Procedure 12. See Lannan v. Board of Governors of the University of North

Carolina, 2022-NCCOA-653, ¶¶ 23, 29 (citation and quotation marks omitted) (when

considering the interlocutory nature of an appeal, recognizing this nature of sovereign

immunity means its loss affects a substantial right but requiring a petition for writ

of certiorari to address the Rule 12(b)(6) failure to state a claim issue); see also Stahl

v. Bowden, 274 N.C. App. 26, 28, 850 S.E.2d 588, 590 (2020) (recognizing claims of

immunity in general, including specifically statutory immunity, affect a substantial

right when considering an interlocutory appeal). Within the two types of immunity,

we will address sovereign immunity first because Plaintiffs raise constitutional issues

around statutory immunity and “it is well settled that ‘the courts of this State will

3The statute has additional requirements we will discuss more below. See N.C. Gen. Stat. § 116-311(a) (including four subsections of requirements). We only include enough information here to demonstrate the relevance of Plaintiffs’ argument about the statute. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

avoid constitutional questions, even if properly presented, where a case may be

resolved on other grounds.’” See Holdstock v. Duke University Health System, Inc.,

270 N.C. App. 267, 277, 841 S.E.2d 307, 314 (2020) (quoting Anderson v. Assimos, 356

N.C. 415, 416, 572 S.E.2d 101, 102 (2002)). Because we ultimately hold sovereign

and/ or statutory immunity bar all of Plaintiffs’ claims, we do not reach the remaining

issues of stating claims for breach of contract and for unjust enrichment or the

standing issue.

A. Sovereign Immunity

¶ 16 Focusing on sovereign immunity first, Plaintiffs argue “Defendant is not

entitled to sovereign immunity.” (Capitalization altered.) Sovereign immunity is at

issue because “[s]overeign immunity protects the State and its agencies from suit

absent waiver or consent” and “Defendant Board of Governors is an agency of the

State” that “can claim the protection of sovereign immunity.” See Lannan, ¶ 22

(citations and quotation marks omitted). As a result, if Defendant is entitled to

sovereign immunity, Plaintiffs’ claims are barred and the trial court did not err in

dismissing them.

¶ 17 Turning to Plaintiffs’ specific arguments against the application of sovereign

immunity, Plaintiffs contend as to the contract claims the State, including Defendant

as a state agency, waives sovereign immunity when entering into an implied-in-fact

contract. Defendant responds only an express contract, not a contract implied-in-fact, DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

waives sovereign immunity. Then, Defendant contends even if an implied-in-fact

contract is sufficient to waive sovereign immunity, “the Amended Complaint is

completely void of any factual allegations establishing the existence of even an

implied contract.” Plaintiffs do not include any argument on the waiver of sovereign

immunity for their unjust enrichment claims, which Defendant highlights. After

setting out the standard of review, we examine whether Defendant has sovereign

immunity first as to the unjust enrichment claims and then as to the contract claims.

¶ 18 At the outset, we note many of these questions have been addressed by this

Court’s recent decision in Lannan v. Board of Governors of the University of North

Carolina. That case also involved contract claims arising out of a “switch from in-

person to online learning” during the COVID-19 pandemic, although it covered the

Fall 2020 Term rather than the Spring 2020 Term at issue in this case. See Lannan,

¶¶ 5-6. And in Lannan this Court addressed identical issues surrounding the

applicability of sovereign immunity to implied-in-fact contract claims. See id. ¶¶ 30-

31 (involving issues of whether an implied-in-fact contract could waive sovereign

immunity and whether the plaintiffs had “pled a valid implied-in-fact contract”).

While we now have the benefit of Lannan in making our decision, Lannan had not

come out when the parties originally briefed this case.

1. Standard of Review

¶ 19 In Lannan, this Court explained the standard of review on sovereign immunity DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

issues as follows:

Our Supreme Court recently explained an appellate court “reviews a trial court’s decision to grant or deny a motion to dismiss based upon the doctrine of sovereign immunity using a de novo standard of review.” State ex rel. Stein [v. Kinston Charter Academy, 379 N.C. 560, 2021-NCSC-163], ¶ 23 (citing White v. Trew, 366 N.C. 360, 362–63, 736 S.E.2d 166 (2013)); see also Wray v. City of Greensboro, 370 N.C. 41, 47, 802 S.E.2d 894, 898 (2017) (“Questions of law regarding the applicability of sovereign or governmental immunity are reviewed de novo.” (quoting Irving v. Charlotte-Mecklenburg Bd. of Educ., 368 N.C. 609, 611, 781 S.E.2d 282, 284 (2016))).

To the extent the question of whether Plaintiffs[] pled a valid contract should be reviewed under the standard for orders on motions to dismiss under Rule 12(b)(6), the standard is the same, i.e. de novo. See State ex rel. Stein, ¶ 25 n.2 (explaining standard is the same because “the only factual materials presented for the trial court’s consideration were those contained in the complaint”); see also Wray, 370 N.C. at 46-47, 802 S.E.2d at 898 (stating appellate courts “review appeals from dismissals under Rule 12(b)(6) de novo” immediately before stating same standard for sovereign immunity (quotations and citations omitted)). In conducting such a review of the complaint, appellate courts treat as true the complaint’s allegations. Deminski on behalf of C.E.D. v. State Board of Education, 377 N.C. 406, 2021-NCSC-58, ¶ 12, 858 S.E.2d 788 (“When reviewing a motion to dismiss, an appellate court considers ‘whether the allegations of the complaint, if treated as true, are sufficient to state a claim upon which relief can be granted under some legal theory.’” (quoting Coley v. State, 360 N.C. 493, 494–95, 631 S.E.2d 121, 123 (2006))); see also State ex rel. Stein, ¶ 25. An appellate court “is not, however, required to accept mere conclusory allegations, unwarranted deductions of fact, or unreasonable inferences as true.” Estate of Vaughn v. Pike Elec., LLC, DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

230 N.C. App. 485, 493, 751 S.E.2d 227, 233 (2013).

See id. ¶¶ 32-33 (brackets from original omitted).

2. Unjust Enrichment Claims

¶ 20 As Defendant identifies, Plaintiffs do not argue on appeal Defendant consented

to suit or otherwise waived its sovereign immunity. Under our Appellate Rules,

Plaintiffs have therefore abandoned the issue of whether sovereign immunity was a

valid ground on which to dismiss their unjust enrichment claims. See N.C. R. App.

P. 28(a) (“Issues not presented and discussed in a party’s brief are deemed

abandoned.”).

¶ 21 Even if Plaintiffs had argued sovereign immunity did not bar their unjust

enrichment claims, we would reject that argument. As this Court recently reaffirmed

in Lannan, “contracts implied in law, which are also called quasi contracts and which

permit recovery based on quantum meruit, do not waive sovereign immunity.” See

Lannan, ¶ 37 (citing, inter alia, Whitfield v. Gilchrist, 348 N.C. 39, 41-42, 497 S.E.2d

412, 414 (1998)). As Whitfield in turn explains, “Quantum meruit is a measure of

recovery for the reasonable value of services rendered in order to prevent unjust

enrichment. It operates as an equitable remedy based upon a quasi contract or a

contract implied in law.” Whitfield, 348 N.C. at 42, 497 S.E.2d at 414-15 (emphasis

added) (citations omitted). Thus, claims for unjust enrichment do not waive sovereign

immunity because they involve contracts implied in law. See M Series Rebuild, LLC DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

v. Town of Mount Pleasant, Inc., 222 N.C. App. 59, 67, 730 S.E.2d 254, 260 (2012)

(“[W]e decline to imply a contract in law in derogation of sovereign immunity to allow

a party to recover under a theory of unjust enrichment.” (citation and quotation

marks omitted)). Since Plaintiffs have provided no other reason Defendant waived

sovereign immunity, their unjust enrichment claims are barred by sovereign

immunity. The trial court did not err in dismissing those claims.

3. Contract Claims

¶ 22 Turning to Plaintiffs’ remaining contract claims, the parties’ arguments

present two questions: (1) whether a valid implied-in-fact contract can waive

sovereign immunity and (2) whether Plaintiffs pled valid implied-in-fact contracts.

¶ 23 Lannan answers the first question; “a contract implied in fact can waive

sovereign immunity under the contractual waiver holding” in Smith v. State. See

Lannan, ¶ 51 (referencing Smith v. State, 289 N.C. 303, 222 S.E.2d 412 (1976)); see

also Smith, 289 N.C. at 320, 222 S.E.2d at 423-24 (“[W]henever the State of North

Carolina, through its authorized officers and agencies, enters into a valid contract,

the State implicitly consents to be sued for damages on the contract in the event it

breaches the contract.”). Lannan reached that conclusion after an extensive analysis

of our caselaw on contracts waiving sovereign immunity. Lannan, ¶¶ 35-50. Lannan

also explained the existence of N.C. Gen. Stat. § 116-311, i.e. the basis of the statutory

immunity issue here, indicated the General Assembly did not believe the contract DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

claims were already barred by sovereign immunity because otherwise “[t]here would

be no need for this separate immunity statute[.]” See Lannan, ¶ 50.

¶ 24 In undertaking that analysis, this Court also rejected the same arguments

Defendant now advances when arguing a valid implied-in-fact contract does not

waive sovereign immunity. First, the Lannan Court rejected Defendant’s argument

Whitfield and Eastway Wrecker Service, Inc. v. City of Charlotte, 165 N.C. App. 639,

599 S.E.2d 410 (2004), require an express contract for a waiver of sovereign immunity

because those two cases were limited to situations involving contracts implied in law

even though they included “overly broad” statements at times. See Lannan, ¶¶ 38-

41 (analyzing cases before concluding “Whitfield and Eastway Wrecker Service only

allow the State to defend itself based on sovereign immunity against contracts

implied in law, not contracts implied in fact”).

¶ 25 Lannan’s rejection of Defendant’s arguments also relied on “another line of

cases holding the State waives its sovereign immunity when it enters into a contract

implied in fact.” Id. ¶ 41; see also, id. ¶¶ 41-43 (full analysis of that line of cases,

namely Archer v. Rockingham County, 144 N.C. App. 550, 548 S.E.2d 788 (2001),

Sanders v. State Personnel Com’n, 183 N.C. App. 15, 644 S.E.2d 10 (2007), and Lake

v. State Health Plan for Teachers and State Employees, 234 N.C. App. 368, 760 S.E.2d

268 (2014)). Defendant here contends those cases were limited to “employment

settings” rather than the “educational setting” present here, (emphasis omitted), but DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

the Lannan court rejected a similar argument for several reasons. See Lannan, ¶¶

44-48. First, the reasoning of that line of cases “extends beyond the employment

context.” Id. ¶ 45. Second, “the employment context and the educational context are

not so different that we can disregard the cases addressing contracts implied in fact

in the employment context.” Id. ¶ 46. Finally, extending that line of cases “beyond

the employment context is consistent with our treatment of implied in fact contracts

in general” because “[o]ur Supreme Court has long held ‘an implied in fact contract

is valid and enforceable as if it were express or written.’” Id. ¶ 47 (quoting Snyder v.

Freeman, 300 N.C. 204, 217, 266 S.E.2d 593, 602 (1980)) (brackets omitted).

¶ 26 Since Lannan already determined a “contract implied in fact can waive

sovereign immunity[,]” we turn to the remaining question, whether Plaintiffs pled a

valid implied-in-fact contract. See id. ¶ 51. “[T]o plead a valid implied-in-fact

contract, Plaintiffs needed to plead offer, acceptance, and consideration.” Id. ¶ 54.

We examine this issue as to each of the four contract claims: tuition, student fees, on-

campus housing, and meals.

¶ 27 Plaintiffs adequately pled their tuition claim. Specifically, the Amended

Complaint alleges “Defendant offered to provide, and members of the Tuition class

expected to receive, instruction on a physical campus” rather than the “separate and

distinct product[]” of “online distance education” based on: (1) Defendant and the

Universities’ “website[s], academic catalogues, student handbooks, marketing DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

materials and other circulars, bulletins, and publications” that differentiate between

“fully online” programs and “non-online” programs with “references to and promises

about the on-campus experience,” which Plaintiffs included examples of in the

Amended Complaint; (2) differences in how students register for on-campus versus

online instruction; and (3) “the parties’ prior course of conduct” in starting classes “for

which students expected to receive in-person instruction” with such instruction and

with class materials with in-person “schedules, locations, and . . . requirements.”

Turning to acceptance, Plaintiffs allege they accepted the offer for “live, in-person

education” by “paying tuition and attending classes during the beginning of the

Spring 2020” Term. Finally, the Amended Complaint states Plaintiffs and the

proposed class “paid valuable consideration in exchange” for in-person learning,

which refers back to the tuition money they paid to accept the offer.

¶ 28 For the student fees contract claim, Plaintiffs allege Defendant “[i]n its

publications and, particularly in its catalogs and website” described the “purpose of

each fee” such that everyone understood “the monies Plaintiff[s] and other members

of the [proposed class] paid towards these fees were intended . . . to cover the services,

access, benefits and programs for which the fees were described and billed,” thereby

constituting an offer. The Amended Complaint includes various descriptions of these

fees. Plaintiffs then allege they paid the fees to the Universities, which constituted

acceptance and consideration and therefore formed a contract. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

¶ 29 Similarly, as to the on-campus housing and meals claims, the Amended

Complaint alleges the Universities offered “on-campus housing” and “meals and on-

campus dining options” to students who agreed to pay certain fees. As pled, the

students then accepted those offers and gave consideration when they paid the

required fees to receive on-campus housing or dining and meals. Thus, Plaintiffs

adequately pled a valid implied-in-fact contract as to each of the four contract claims.

¶ 30 None of Defendant’s arguments persuade us otherwise. While Defendant’s

section on sovereign immunity only includes a single sentence arguing “the Amended

Complaint is completely void of any factual allegations establishing the existence of

even an implied contract,” Defendant later includes additional arguments about the

ways in which “Plaintiffs’ Amended Complaint fails to identify a contract” in its

section on how Plaintiffs failed to state a claim for breach of contract. (Capitalization

altered.) Specifically, Defendant first argues “every contract requires a promise” and

Plaintiffs did not include any such allegations of promises or, specifically, promises

to refunds. This argument is partially premised on two cases, Ryan v. University of

North Carolina Hospitals, 128 N.C. App. 300, 494 S.E.2d 789 (1998) and Montessori

Children’s House of Durham v. Blizzard, 244 N.C. App. 633, 781 S.E.2d 511 (2016),

that, according to Defendant, require allegations to be based on “identifiable

contractual promises” such that “statements made in a university policy manual or

other university publication are insufficient to support a breach of contract claim DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

unless they are explicitly included or incorporated into a contract.” (Emphasis

omitted.)

¶ 31 Defendant’s contention the Amended Complaint does not allege promises

underlying a contract cannot be squared with the pleading. While the Amended

Complaint does not include the specific term “promise” when describing what the

Universities offered to students, the offers constitute promises to act nonetheless. As

laid out above, the Universities offered in-person education, benefits as described in

the student fee descriptions, and on-campus housing and meals according to the

Amended Complaint. Those offers were promises to provide those services if

Plaintiffs and other members of the proposed classes paid the fees. In other words,

by their acceptance and payment of consideration, Plaintiffs converted Defendant’s

offer into promises. See Wilkins v. Vass Cotton Mills, 176 N.C. 72, 81, 97 S.E. 151,

155 (1918) (“An acceptance by promise or act, and communication thereof when

necessary, while an offer of a promise is in force, changes the character of the offer.

It supplies the elements of agreement and consideration, changing the offer into a

binding promise, and the offer cannot afterwards be revoked without the acceptor’s

consent.” (citation and quotation marks omitted)). Thus, by properly alleging the

contract, Plaintiffs have pled a promise necessary to form a contract.

¶ 32 Defendant’s reliance on Ryan and Montessori Children’s House is also

misplaced. As this Court explained in Lannan, Ryan and Montessori Children’s DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

House both involved pre-existing written contracts. See Lannan, ¶¶ 57-58. As such,

they differ from the case here where Plaintiffs allege the statements made in

university publications “are the contract.” See id. ¶ 62. And thus their statements

about requiring an “identifiable contractual promise” or incorporation of publications

into a contract do not apply here to bar Plaintiffs’ contract claims. See id. ¶¶ 57-58

(citation and quotation marks omitted).

¶ 33 Next, Defendant argues none of the described fees “support[] Plaintiffs’ claim

that a contract exists entitling them to a refund for fees in the event the format of

instruction changed” because Plaintiffs did not plead they took advantage of services,

services ceased with the shift to online learning, or the pre-existing refunds for meals

and housing were insufficient. First, while these arguments are under a heading

labeled “Plaintiffs’ Amended Complaint fails to identify a contract and thus fails to

state a contract claim[,]” they address breach because they all focus on the provision

of services or remedy for lack of the allegedly contracted for services. This matters

because the waiver of sovereign immunity only requires pleading a valid contract, not

pleading breach; pleading breach is only relevant when looking at Rule of Civil

Procedure 12(b)(6) and dismissal for failure to state a claim. See Lannan, ¶¶ 27-28

(explaining a valid contract is necessary to both waive sovereign immunity and

survive a Rule 12(b)(6) motion to dismiss but breach is also necessary to state a

breach of contract claim that survives such a motion) and ¶ 66 (addressing only DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

breach to rule on 12(b)(6) motion to dismiss contract claims because this Court had

“already determined above [the p]laintiffs pled a valid contract”).

¶ 34 Even if Defendant’s arguments on breach could impact whether Plaintiffs pled

a valid contract sufficient to waive sovereign immunity, we would still reject its

contentions. As to the contention Plaintiffs did not plead they took advantage of the

services for which they paid student fees, the Amended Complaint alleges “as a result

of being moved off campus,” Plaintiffs and the proposed class “no longer have the

benefit of the services for which these fees have been paid” and lists numerous

services. The language “no longer” suggests the Plaintiffs had used the services in

the past. Further, some of the services, such as “campus . . . security measures” are

things Plaintiffs would passively benefit from rather than actively take advantage of

in many circumstances. As to Defendant’s argument Plaintiffs failed to plead services

ceased when students shifted to online instruction, the Amended Complaint plainly

states that transition included “closing most campus buildings and facilities, and

cancelling most student activities.” That followed a more specific allegation that “as

a result of being moved off campus” Plaintiffs “were unable to participate in

recreational and intramural programs; no longer had access to campus fitness centers

or gymnasiums; no longer benefit[t]ed from campus technology[,] infrastructure[,] or

security measures; and no longer had the benefit of enjoying Spring intercollegiate

competitions.” The Amended Complaint also includes allegations detailing why the DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

refunds for housing and meals failed to fully reimburse Plaintiffs for the services they

could not access due to campus shutdowns by calculating the dates of the shutdowns

versus the dates upon which the refunds were based.

¶ 35 Finally, Defendant argues “Plaintiffs’ claims are veiled educational

malpractice claims which are not allowed in North Carolina,” again relying on Ryan

as the only binding authority. (Capitalization altered.) While Defendant is correct

North Carolina does not permit educational malpractice claims, see Ryan, 128 N.C.

App. at 302-03, 494 S.E.2d at 791 (only permitting claim to go forward because it

“would not involve an inquiry into the nuances of educational processes and theories”

(quotation marks omitted)), Plaintiffs are not making such a claim. In Ryan, this

Court clarified educational malpractice claims require “an inquiry into the nuances

of educational processes and theories.” See id. at 302, 494 S.E.2d at 791. The Ryan

Court also relied heavily on a Seventh Circuit case that clarified an educational

malpractice claim alleged “the school breached its agreement by failing to provide an

effective education” or “simply . . . that the education was not good enough.” See id.

(quoting Ross v. Creighton Univ., 957 F.2d 410, 416-17 (7th Cir. 1992)).

¶ 36 Reviewing Plaintiffs’ contract claims does not require an investigation into

educational processes or theories or a determination of whether the education was

adequate. The student fees, housing, and meals claims do not involve education

practices at all; they involve separate amenities Plaintiffs allege they paid to access DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

as discussed above. And Plaintiffs’ tuition claim alleges they paid for “live, in-person,

on-campus education” but instead received instruction via “online distance learning

platforms[.]” Defendants do not indicate any place where Plaintiffs’ tuition claim

turns on whether one of those types of education is better than the other in terms of

educational quality. Defendant’s best argument to the contrary is that calculating

damages for Plaintiffs’ tuition claim would require determining “the difference in

value between in-person and distance learning.” But the trial court would not need

to do that in the future if this case reaches a damages stage because Defendant has

already set different tuitions for on-campus and distance learning programs

according to the allegations in the Amended Complaint. At its heart, Plaintiffs’

tuition claim alleges they contracted and paid for product A and received product B

for part of the Spring 2020 Term. Products A and B can represent anything in that

scenario, demonstrating that the claim does not rely on reviewing educational

processes or even on the educational setting itself.

¶ 37 Having rejected all Defendant’s arguments, we conclude after our de novo

review sovereign immunity does not bar Plaintiffs’ contract claims, although it does

bar their unjust enrichment claims.

B. Statutory Immunity

¶ 38 As the contract claims survive sovereign immunity, we next turn to statutory

immunity. As explained above, Plaintiffs argue N.C. Gen. Stat. § 116-311, which DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

provides immunity to claims for tuition and fees for COVID-19 related university

closures, “is unconstitutional and inapplicable to this action.” (Capitalization

altered.) See N.C. Gen. Stat. § 116-311(a). Following the doctrine of constitutional

avoidance, see Holdstock, 270 N.C. App. at 277, 841 S.E.2d at 314 (“[T]he courts of

this State will avoid constitutional questions, even if properly presented, where a case

may be resolved on other grounds.”), we will first consider whether § 116-311 is

applicable here and then address the constitutionality of the statute.

1. Applicability of North Carolina General Statute § 116-311

¶ 39 Plaintiffs first argue § 116-311 is “inapplicable to this action.” (Capitalization

altered.) North Carolina General Statute § 116-311 provides, in relevant part:

Notwithstanding any other provision of law and subject to G.S. 116-312, an institution of higher education shall have immunity from claims by an individual, if all of the following apply:

(1) The claim arises out of or is in connection with tuition or fees paid to the institution of higher education for the spring academic semester of 2020. (2) The claim alleges losses or damages arising from an act or omission by the institution of higher education during or in response to COVID-19, the COVID-19 emergency declaration, or the COVID-19 essential business executive order. (3) The alleged act or omission by the institution of higher education was reasonably related to protecting the public health, safety, or welfare in response to the COVID-19 emergency declaration, COVID-19 essential business executive order, or applicable guidance from the Centers for Disease DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

Control and Prevention. (4) The institution of higher education offered remote learning options for enrolled students during the spring academic semester of 2020 that allowed students to complete the semester coursework.

N.C. Gen. Stat. § 116-311(a). Plaintiffs’ first argument is that

the “plain meaning of this statute is to provide immunity for tort claims” because it

includes the language “act or omission.” Plaintiffs also contend “Defendant’s refusal

to provide fair tuition and [fee] refunds” is not “reasonably related to protecting public

health or safety.”

¶ 40 As questions of statutory interpretation, we review Plaintiffs’ arguments de

novo. See Winkler v. North Carolina State Board of Plumbing, 374 N.C. 726, 730, 843

S.E.2d 207, 210 (2020) (“Thus, this case presents an issue of statutory interpretation,

which we review de novo.” (citing Applewood Props., LLC v. New S. Props., LLC, 366

N.C. 518, 522, 742 S.E.2d 776, 779 (2013))). “When the language of a statute is clear

and without ambiguity, it is the duty of this Court to give effect to the plain meaning

of the statute, and judicial construction of legislative intent is not required.” Id.

(quoting N.C. Dep’t of Corr. v. N.C. Med. Bd., 363 N.C. 189, 201, 675 S.E.2d 641, 649

(2009) (brackets omitted)).

¶ 41 Section 116-311(a), by its plain language, provides “immunity from claims[.]”

N.C. Gen. Stat. § 116-311(a). Plaintiffs argue the term claims should be limited to

tort claims, and thus not cover their contract claims, because the claim must “allege[] DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

losses or damages arising from an act or omission.” N.C. Gen. Stat. § 116-311(a)(2).

But this argument ignores the statutory definition of claims. N.C. Gen. Stat. § 116-

310 defines “Claim” as, “A claim or cause of action seeking any legal or equitable

remedy or relief” for the purpose of the article on “Covid-19 Immunity for Institutions

of Higher Education,” which includes § 116-311. N.C. Gen. Stat. § 116-310(1) (2021).

That definition includes any claim or cause of action that could be brought, so it

necessarily includes Plaintiffs’ contract claims, and, as an alternative basis for our

decision, Plaintiffs’ unjust enrichment claims. “If a statute ‘contains a definition of a

word used therein, that definition controls.’” Lovin v. Cherokee County, 248 N.C. App.

527, 529, 789 S.E.2d 869, 871 (2016) (quoting In re Clayton-Marcus Co., Inc., 286 N.C.

215, 219, 210 S.E.2d 199, 202 (1974)). Therefore, we reject Plaintiffs’ argument the

statutory immunity provided by § 116-311 applies only to tort claims; it applies to all

claims, including all of Plaintiffs’ contract and unjust enrichment claims.

¶ 42 The remainder of § 116-311 provides five requirements for immunity to apply.

First, the statute imports the limits provided in § 116-312, which limits the timeframe

of the immunity to “alleged acts or omissions occurring on or after the issuance of the

COVID-19 emergency declaration until June 1, 2020.” See N.C. Gen. Stat. § 116-311

(making clear the immunity is “subject to G.S. 116-312”); N.C. Gen. Stat. § 116-312

(including quoted language on timeframe of immunity). Then, § 116-311 has the four

individually numbered requirements listed above. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

¶ 43 Of these five requirements, Plaintiffs only contest the requirement in § 116-

311(a)(3) that the “alleged act or omission by the institution of higher education was

reasonably related to protecting the public health, safety, or welfare in response to .

. . COVID-19 . . . .” N.C. Gen. Stat. § 116-311(a)(3). Specifically, Plaintiffs contend

“Defendant’s refusal to provide fair tuition and [fee] refunds” is not “reasonably

related to protecting public health or safety.” In making that argument, Plaintiffs

misunderstand the relevant “alleged act or omission.” N.C. Gen. Stat. § 116-311(a)(3).

The alleged act or omission that gave rise to Plaintiffs’ claims was, at least in part,

Defendant and its Universities shutting down their campuses and moving classes

online according to Plaintiffs’ own Amended Complaint. For example, the tuition

contract claim explains: “However, the University breached the contract with

Plaintiffs and other members of the Tuition Class by moving all classes for the Spring

2020 semester to online distance learning platforms, and restricting the on-campus

experience without reducing or refunding tuition accordingly.” Similarly, the tuition

unjust enrichment claim states:

Instead, Plaintiffs and other members of the Tuition Class conferred this benefit on Defendant in expectation of receiving one product, i.e., live in-person instruction in a physical classroom along with the on-campus experience of campus life as described more fully above, but they were provided with a materially different product carrying a different fair market value, i.e., online instruction devoid of the on-campus experience, access, and services. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

And Plaintiffs’ Amended Complaint also pleads the shift to online instruction was a

result of the COVID-19 pandemic: “On or about March 11 , 2020, in response to the

COVID-19 pandemic, Defendant issued a system-wide directive to all constituent

institutions requiring that they transition from in-person to online instruction no

later than March 23, 2020.” (Emphasis added.) As part of that paragraph on the

transition to online instruction, Plaintiffs include a footnote to a press release on

Defendant’s website about the directive, which clarifies the decision to transition to

online classes was related to “the health and safety of [the Universities’] students,

faculty, and staff . . . .” UNC System Issues Update on Coronavirus Preparations, The

University of North Carolina System (Mar. 12, 2020).4 Thus, contrary to Plaintiffs’

argument, the alleged acts or omissions were “reasonably related to protecting the

public health, safety, or welfare in response to . . . COVID-19 . . . .” N.C. Gen. Stat. §

116-311(a)(3).

¶ 44 The remaining four requirements for statutory immunity under § 116-311(a)

are also met here. As to timing, the above allegation about the system-wide directive

indicates the decision to shift to online learning was announced on 11 March 2020.

Governor Roy Cooper had already entered “the first of many emergency orders . . . in

response to the COVID-19 pandemic” on 10 March 2020, Hall v. Wilmington Health,

4 Available at: https://www.northcarolina.edu/news/unc-system-issues-update-on- coronavirus-preparations/. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

PLLC, 282 N.C. App. 463, 2022-NCCOA-204, ¶ 6; see also E.O. 116, Cooper, 2020, §

1 (declaring a state of emergency based on “the public health emergency posed by

COVID-19”), which started the period of immunity under § 116-312. See N.C. Gen.

Stat. § 116-312 (applying immunity to “alleged acts or omissions occurring on or after

the issuance of the COVID-19 emergency declaration until June 1, 2020”). The

remaining actions related to the campus shutdowns all took place within this time

period as well.

¶ 45 Turning to the next requirement, the claims all arose “out of or [are] in

connection with tuition or fees . . . for the spring academic semester of 2020.” See

N.C. Gen. Stat. § 116-311(a)(1). The Amended Complaint’s introduction explains the

claims arise from “Defendant’s decision not to issue appropriate refunds for the

Spring 2020 semester” for “tuition, housing, meals, fees and other costs that

Defendant failed to deliver for the second half of the Spring 2020 semester . . . .”

Similarly, the four groups of claims (one each for breach of contract and unjust

enrichment) are for: tuition, student fees, on-campus housing fees, and meal fees.

Further, as we have already discussed, the actions by Defendant and the Universities

were taken “in response to COVID-19[.]” See N.C. Gen. Stat. § 116-311(a)(2). Finally,

Plaintiffs acknowledge “[f]rom March 23, 2020 through the end of the Spring 2020

semester, there were no in-person classes at Defendant’s institutions, and all

instruction was delivered online[,]” (emphasis added), thereby meeting the final DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

requirement in § 116-311(a)(4). See N.C. Gen. Stat. § 116-311(a)(4).

¶ 46 Since all the statutory requirements are met here, § 116-311(a) applies to

Plaintiffs’ claims, both their contract claims and their unjust enrichment claims.

Thus, after our de novo review and under the statute’s plain language, Defendant has

immunity from these claims. N.C. Gen. Stat. § 116-311(a).

2. Constitutionality of North Carolina General Statute § 116-311

¶ 47 Having decided § 116-311 applies to Plaintiffs’ claims and grants Defendant

immunity, we now address Plaintiffs’ argument the statute is unconstitutional.

Plaintiff argues the law is unconstitutional for five reasons: (1) “such a law squarely

violates U.S. Con[s]t. art. I, § 10 cl. 1 which reads, in pertinent part, ‘[n]o State shall

. . . pass any . . . law impairing the Obligation of Contracts[;]’” (2) “the statute would

violate the equal protection clause of both the United States and North Carolina

Constitutions[;]” (3) “the statute violates the due process clauses of the United States

and North Carolina Constitutions[;]” (4) “the statute would violate U.S. Const.

amend. V which prohibits the taking of private property without just compensation[;]”

and (5) “the statute intrudes upon the separation of powers because it is a law that

was passed in response to specific litigation already pending in the courts with the

purposes of directing the courts on how to adjudicate the pending actions.”

¶ 48 Before arguing § 116-311 “is not unconstitutional[,]” Defendant contends

“Plaintiffs have waived any purported constitutional challenges to” the statute. After DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

discussing the standard of review, we first review whether Plaintiffs have waived the

issue and then the merits of Plaintiffs’ argument the statute is unconstitutional.

a. Standard of Review

¶ 49 For challenges under both the federal and State Constitutions, we review the

constitutionality of statutes de novo. See North Carolina Ass’n of Educators, Inc. v.

State, 368 N.C. 777, 786, 786 S.E.2d 255, 262 (2016) (stating, in a case where a party

argued a statute was unconstitutional under Article I, § 10 of the United States

Constitution, “we review de novo any challenges to a statute’s constitutionality”);

Cooper v. Berger, 376 N.C. 22, 33, 36, 852 S.E.2d 46, 56, 58 (2020) (stating, in a case

challenging the constitutionality of a statute under our State Constitution,

“[a]ccording to well-established North Carolina law,” appellate courts “review[]

constitutional questions using a de novo standard of review”). “In exercising de novo

review, we presume that laws enacted by the General Assembly are constitutional,

and we will not declare a law invalid unless we determine that it is unconstitutional

beyond a reasonable doubt.” Cooper, 376 N.C. at 33, 852 S.E.2d at 56 (citation and

quotation marks omitted); see also North Carolina Ass’n of Educators, 368 N.C. at

786, 786 S.E.2d at 262 (“This Court presumes that statutes passed by the General

Assembly are constitutional, and duly passed acts will not be struck unless found

unconstitutional beyond a reasonable doubt[.]” (citations omitted)). DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

b. Waiver

¶ 50 In its waiver argument, Defendant specifically asserts “[a] facial constitutional

challenge to a state statute is governed by the procedure found in N.C. Gen. Stat. §§

1-267.1, 1-81.1, and [1A-1,] N.C. R. Civ. P. 42(b)(4).” Defendant alleges “Plaintiffs

failed to comply with the requirements of Rule 42(b)(4)[5] for raising a facial challenge

to the constitutionality” of § 116-311 and thus “have waived their ability to do so.”

¶ 51 Defendant’s argument rests on a faulty premise because Plaintiffs only raised

as-applied constitutional challenges below. During the hearing on Defendant’s

Motion to Dismiss the Amended Complaint, Plaintiffs’ attorney emphasized four

separate times they were making as-applied challenges:

• “The first thing I will say and that I want to make very clear is that we

have not made a facial challenge to the statute. We are alleging as

applied in this case, as they wish to apply it, it is unconstitutional

particularly among a number of other sections against the federal

contracts clause.”

• “Again, I would posit that we are not making a facial challenge but an

5 The requirements of Rule 42(b)(4) control the application of the other two statutes Defendant previously mentioned, §§ 1-267.1 and 1-81.1. See Holdstock, 270 N.C. App. at 273, 276, 841 S.E.2d at 312, 314 (explaining how Rule 42(b)(4) “limits the application of N.C.G.S. § 1-267.1(a1)” and then discussing how § 1-81.1 also “restricts” its “requirement to only properly raised challenges as set forth in Rule 42(b)(4)” (emphasis from original omitted)). DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

as-applied challenge.”

• “We’re making an as-applied challenge.”

• “That is not what we’re trying to do is make a facial challenge to this.”

¶ 52 The as-applied nature of the challenge matters because the statutes Defendant

directs our attention towards “only apply to ‘facial challenges to the validity of an act

of the General Assembly, not as applied challenges.’” See Cryan v. National Council

of Young Men’s Christian Associations of the United States, 280 N.C. App. 309, 2021-

NCCOA-612, ¶ 19 (quoting Holdstock, 270 N.C. App. at 271, 841 S.E.2d at 311). And

Plaintiffs clarifying they were not making a facial challenge, combined with the lack

of a trial court ruling that Plaintiffs were actually making a facial challenge, means

no facial challenge was made to trigger the requirements set out by §§ 1-267.1, 1-81.1,

and 1A-1, Rule 42. See Cryan, ¶ 21 (“As Defendant made clear they were only making

an as applied challenge to the 2019 amendments, and the trial court did not make a

determination itself that Defendant’s constitutional challenges were in fact a facial

challenge, no facial challenge was made in the time prescribed by Rule 42(b)(4) for a

court to be able to transfer a facial challenge to a three-judge panel.”).

¶ 53 Although Plaintiffs argued their constitutional challenge was only an as-

applied claim, we recognize that Plaintiffs’ own characterization of the claim is not

necessarily the end of the analysis. Recently, this Court in Kelly v. State held “a court

is not restricted per se by a party’s categorization of its challenge as facial or as- DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

applied and may conduct its own review to determine whether the party’s challenge

is facial or as-applied.” Kelly v. State, 2022-NCCOA-675, ¶ 23. As Judge Hampson’s

dissent in Kelly indicates, id. ¶¶ 47-48 (Hampson, J. Dissenting), this holding may

conflict with Cryan because Cryan focused primarily on whether a party itself said

they were making a facial or as-applied challenge. Cryan, ¶ 21 (“As [the d]efendant

made clear they were only making an as applied challenge . . . no facial challenge was

made . . . .”). If the tests from Cryan and Kelly were to lead to different outcomes, we

would need to address this potential conflict in precedent. See, e.g., Huml v. Huml,

264 N.C. App. 376, 395, 826 S.E.2d 532, 545 (2019) (explaining how to resolve “a

conflict in cases issued by this Court addressing an issue”).

¶ 54 But we do not need to address this potential conflict in precedent. Whether we

apply the test announced in Kelly or we rely upon Cryan, the result is the same:

Plaintiffs’ challenge to § 116-311 here is an as-applied challenge. See Kelly, ¶¶ 24, 26

(setting out test for “determining whether a challenge is as-applied or facial”). The

Kelly Court explained the test to differentiate between as-applied and facial

challenges requires a court to “look to the breadth of the remedy requested.” Kelly, ¶

24. The Kelly Court then differentiated between the two types of challenges:

A claim is properly classified as a facial challenge if the relief that would accompany it “reach[es] beyond the particular circumstances of these plaintiffs.” Doe [v. Reed], 561 U.S. [186,] 194, 130 S. Ct. [2811,] 2817, 177 L. Ed. 2d [493,] 501. A claim is properly classified as an as-applied DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

challenge if the remedy “is limited to a plaintiff’s particular case.” Libertarian Party v. Cuomo, 300 F. Supp. 3d 424, 439 (W.D.N.Y. 2018), overruled on other grounds by N.Y. State Rifle & Pistol Ass’n v. Bruen, --- U.S. ----, 142 S. Ct. 2111, 213 L. Ed. 2d 387 (2022).

Id. (first brackets in original). In Kelly, this Court determined the plaintiffs made a

facial challenge because (1) the relief requested “would, if successful, effectively

preclude all enforcement of the statute[;]” and (2) the plaintiffs did not allege any

facts from which an as-applied determination could be made because they had not

sought to be part of the challenged program. Id. ¶¶ 27-31 (citations and quotation

marks omitted).

¶ 55 Here, examining Plaintiffs’ challenge with Kelly’s test, we again conclude

Plaintiffs have made an as-applied challenge. First, looking at the relief requested,

see id. ¶ 28, Plaintiffs made the constitutional challenge in the context of their specific

case where they are seeking to recover money they and the proposed classes paid for

tuition, fees, on-campus housing, and meals. This situation differs from Kelly where

the plaintiffs sought a declaratory judgment the challenged program was

unconstitutional and a permanent injunction against continued operation of that

program. See id. ¶ 27. Here, we could find an as-applied constitutional violation that

opens a limited pathway to allow Plaintiffs and the proposed class to recover the

monies they seek without “effectively preclude[ing] all enforcement” of § 116-311

since Plaintiffs do not seek a declaratory judgment that the statute is DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

unconstitutional or injunctive relief barring its enforcement. See id. ¶ 28. Plaintiffs

merely seek a ruling § 116-311 cannot be used to grant Defendant immunity from

their lawsuit. For example, they argued before the trial court: “That is not what we’re

trying to do is make a facial challenge to this. I don’t care whether the state and

Lenoir-Rhyne or Gardner-Webb try to enforce this immunity on any other students

that might run this. I’m concerned about the case that I’ve brought.”

¶ 56 Further, unlike the plaintiffs in Kelly, Plaintiffs here could and did allege facts

on which an as-applied constitutionality determination could be made because they

were impacted by the challenged statute. See id. ¶ 30. For example, Plaintiffs’

attorney argued below the challenge was partially based on “the federal contracts

clause.” As discussed above, Plaintiffs’ Amended Complaint alleges they personally

entered into contracts with the Universities, so they could challenge § 116-311 on the

ground it impaired their contracts specifically. See North Carolina Ass’n of

Educators, 368 N.C. at 786, 786 S.E.2d at 262 (explaining the Contract Clause of the

United States Constitution bars a state from passing “any Law impairing the

Obligation of Contracts” (quoting U.S. Const. art. I, § 10 (ellipses omitted))).

Although we do not have in our record Plaintiffs’ precise arguments before the trial

court on this ground, see Fn. 2, supra, their separation of powers argument

demonstrates the as-applied nature of their challenge to § 116-311 even more clearly.

On appeal, Plaintiffs argue § 116-311 unconstitutionally “intrudes upon the DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

separation of powers because it is a law that was passed in response to specific

litigation already pending in the courts with the purposes of directing the courts on

how to adjudicate the pending actions.” This argument relies on when Plaintiffs filed

their specific lawsuit, i.e. before the General Assembly passed the immunity statute,

so it necessarily relies on facts “specific to” Plaintiffs “from which to determine

whether the statute is unconstitutional as applied.” See Kelly, ¶ 30 (requiring such

facts for a challenge to be as-applied).

¶ 57 Under both of Kelly’s factors, see id. ¶¶ 27-31, Plaintiffs here make an as-

applied challenge to the immunity statute. Thus, applying Kelly’s test, we reach the

same conclusion as our previous analysis based on Cryan. Therefore, we reject

Defendant’s argument Plaintiffs have waived their constitutional challenges to § 116-

311 and the statutory immunity it provides against Plaintiffs’ claims.

c. Merits

¶ 58 Turning to the merits, Plaintiffs argue § 116-311 is unconstitutional on five

grounds: (1) the United States Constitution’s clause barring states from impairing

contracts; (2) the Equal Protection Clauses of the United States and North Carolina

Constitutions; (3) the Due Process Clauses of the United States and North Carolina

Constitutions; (4) the Takings Clause in the Fifth Amendment of the United States

Constitution; and (5) the separation of powers doctrine. We address each of those five

arguments in turn. DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

¶ 59 Under the Contract Clause of the United States Constitution, “no State shall

pass any Law impairing the Obligation of Contracts.” North Carolina Ass’n of

Educators, 368 N.C. at 786, 786 S.E.2d at 262 (quoting U.S. Const. art. I, § 10)

(ellipses and brackets omitted). Our courts use a three-factor test to “determine

whether a Contract Clause violation exists.” Id. (citing Bailey v. State, 348 N.C. 130,

141, 500 S.E.2d 54, 60 (1998)). That test, adopted from the Supreme Court of the

United States’s decision in U.S. Trust Co. of N.Y. v. New Jersey, “requires a court to

ascertain: (1) whether a contractual obligation is present, (2) whether the state’s

actions impaired that contract, and (3) whether the impairment was reasonable and

necessary to serve an important public purpose.” Bailey, 348 N.C. at 140-41, 500

S.E.2d at 60 (citing U.S. Trust Co. of N.Y. v. New Jersey, 431 U.S. 1, 52 L.Ed.2d 92

(1977)). Here, we have already determined Plaintiffs pled a valid contractual

obligation when we decided the contract claims survived sovereign immunity, thereby

meeting the first prong of the test. Assuming arguendo the second prong, impairment

of the contract, is met, Plaintiffs fail at the third prong.

¶ 60 The third prong, “whether the impairment was reasonable and necessary to

serve an important public purpose[,]” recognizes “[n]ot every impairment of

contractual obligations by a state violates the Contract Clause” because the state can

still permissibly use its police power. Bailey, 348 N.C. at 151, 500 S.E.2d at 66 (citing

U.S. Trust Co., 431 U.S. at 21, 25-26, 52 L.Ed.2d at 109, 111-12). The third prong DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

“involves a two-step process, first identifying the actual harm the state seeks to cure,

then considering whether the remedial measure adopted by the state is both a

reasonable and necessary means of addressing that purpose.” North Carolina Ass’n

of Educators, 368 N.C. at 791, 786 S.E.2d at 265 (citing Energy Reserves Group, Inc.

v. Kansas Power and Light Co., 459 U.S. 400, 412, 74 L.Ed.2d 569, 581 (1983)); see

also Lake v. State Health Plan for Teachers and State Employees, 380 N.C. 502, 2022-

NCSC-22, ¶ 64 (quoting that portion of North Carolina Ass’n of Educators).

¶ 61 Here, the Article on immunity explains the purpose of the statute: “It is a

matter of vital State concern affecting the public health, safety, and welfare that

institutions of higher education continue to be able to fulfill their educational

missions during the COVID-19 pandemic without civil liability for any acts or

omissions for which immunity is provided in this Article.” N.C. Gen. Stat. § 116-313

(2021). In North Carolina Ass’n of Educators, our Supreme Court explained

“maintaining the quality of the public school system is an important purpose.” See

North Carolina Ass’n of Educators, 368 N.C. at 791, 786 S.E.2d at 266. While the

case did so in the context of elementary and secondary school public education, see id.

at 781, 786 S.E.2d at 259 (referencing history of N.C. Gen. Stat. § 115C-325 (2012));

N.C. Gen. Stat. Chapter 115C (covering elementary and secondary education), the

quality of post-secondary education is also an important purpose for the State,

especially when it has decided to create a public university system to, inter alia, DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

“improve the quality of education[.]” See N.C. Gen. Stat. § 116-1(a) (2021) (“In order

to foster the development of a well-planned and coordinated system of higher

education, to improve the quality of education, to extend its benefits and to encourage

an economical use of the State’s resources, the University of North Carolina is hereby

redefined in accordance with the provisions of this Article.”).

¶ 62 Turning to the second part of the third prong, we must determine “whether the

remedial measure adopted by the state is both a reasonable and necessary means of

addressing that purpose.” See North Carolina Ass’n of Educators, 368 N.C. at 791,

786 S.E.2d at 265. The immunity statute was a reasonable means of ensuring the

quality of education because it allowed the Universities to focus on how to best deliver

education online rather than trying to continue in person and expending resources

on all the public health measures necessary to try to achieve that prospect safely.

With the benefit of hindsight, there are many different opinions on the effectiveness

or wisdom of closures of educational institutions as a response to the COVID-19

pandemic, but this Court need not attempt to resolve these questions as they are not

presented by this case. The General Assembly limited the application of N.C. Gen.

Stat. §116-311 to the spring semester of 2020 only, and this was the only semester

during which the Universities had to deal with an immediate response to the COVID-

19 pandemic for students who were already enrolled and on campus when the

Governor’s Emergency Directives were issued. See N.C. Gen. Stat. § 116-311(a)(1) DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

(“The claim arises out of or is in connection with tuition or fees paid to the institution

of higher education for the spring academic semester of 2020.”); see generally E.O.

116, Cooper, 2020, § 1 (first COVID-19 Emergency Directive). The immunity statute

was a reasonable response to the COVID-19 pandemic at the time it was adopted, in

the context of the Governor’s Emergency Directives. See, e.g. E.O. 116, Cooper, 2020,

§ 1 (declaring a state of emergency based on “the public health emergency posed by

COVID-19”); E.O. 120, Cooper, 2020, § 4 (closing other educational institutions,

namely public schools, from 16 March 2020 to 15 May 2020 pursuant to, inter alia,

the state of emergency); E.O. 121, Cooper, 2020, § 1-2, 7 (imposing a 30-day stay-at-

home order effective 30 March 2020 pursuant to, inter alia, the state of emergency

with a limited exception for educational institutions, including public colleges and

universities, only for “facilitating remote learning, performing critical research, or

performing essential functions, provided” social distancing of at least six feet from

other people was respected). The statute was also a necessary response to the

COVID-19 pandemic and the need to ensure educational quality during the early days

of the pandemic. Removing the possibility of liability from the Universities ensured

they could shift to online learning and focus on education without worrying about

either public health measures to continue in person or the prospect of lawsuits arising

from having to change the method of instruction mid-semester. Put another way, it

is unclear what else the General Assembly could have done to achieve the same goal DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

of ensuring the focus was on continuing the Universities’ educational mission in light

of the uncertainty caused by the early days of the COVID-19 pandemic. Because we

find the immunity statute to be reasonable and necessary, we reject Plaintiffs’

argument the statute violates the federal Constitution’s Contract Clause.

¶ 63 Second, Plaintiffs argue § 116-311 violates the equal protection clauses of the

federal and State Constitutions because it “aimed at protecting only one group of

specific entities[,]” Defendant and its Universities “against the claims of another

specific group” and did not extend to other industries that also “suffered financially

from the pandemic” such as “[g]yms, restaurants, and countless other businesses . . .

forced to close their physical locations.” Since Plaintiffs’ argument rests on differing

classifications of universities versus other businesses affected by the COVID-19

pandemic, the tests under the federal and State Constitutions are identical. See

Liebes v. Guilford County Dept. of Public Health, 213 N.C. App. 426, 428, 724 S.E.2d

70, 72 (2011) (“Our courts use the same test as federal courts in evaluating the

constitutionality of challenged classifications under an equal protection analysis.”

(quoting Richardson v. N.C. Dept. of Correction, 345 N.C. 128, 134, 478 S.E.2d 501,

505 (1996))). This Court has described those tests as follows:

Upon the challenge of a statute as violating equal protection, our courts must “first determine which of several tiers of scrutiny should be utilized” and then whether the statute “meets the relevant standard of review.” Department of Transp. v. Rowe, 353 N.C. 671, 675, DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

549 S.E.2d 203, 207 (2001). Where “[t]he upper tier of equal protection analysis requiring strict scrutiny of a governmental classification applies only when the classification impermissibly interferes with the exercise of a fundamental right or operates to the peculiar disadvantage of a suspect class,” we apply the lower tier or rational basis test if the statute neither classifies persons based on suspect characteristics nor impinges on the exercise of a fundamental right. White v. Pate, 308 N.C. 759, 766-67, 304 S.E.2d 199, 204 (1983).

See Liebes, 213 N.C. App. at 428-29, 724 S.E.2d at 72-73. Here, Plaintiffs do not argue

any suspect classification or fundamental right is involved, so we apply only rational

basis. See id. at 428-29, 724 S.E.2d at 73.

¶ 64 “The pertinent inquiry under rational basis scrutiny is whether the

‘distinctions which are drawn by a challenged statute or action bear some rational

relationship to a conceivable legitimate governmental interest.’” Id. at 429, 724

S.E.2d at 73 (quoting Texfi Industries v. City of Fayetteville, 301 N.C. 1, 11, 269 S.E.2d

142, 149 (1980)). While we need not determine the actual purpose when conducting

rational basis review, see id., here the statutory explanation in § 116-313 we

excerpted above provides the required rational basis. Not only are the educational

missions of institutions of higher learning a legitimate government interest, but the

importance of education is also enshrined in our State’s Constitution. See N.C. Const.

Art. IX, § 1 (“Religion, morality, and knowledge being necessary to good government

and the happiness of mankind, schools, libraries, and the means of education shall DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

forever be encouraged.” (emphasis added)). And the immunity law helped further that

purpose by allowing the Universities to focus on educational quality rather than

worry about lawsuits or what public health measures would be needed to allow

schools to continue in person during the early stages of the pandemic. Since there is

a rational basis for treating institutions of higher learning different than gyms or

restaurants, the immunity statute survives equal protection analysis.

¶ 65 Third, Plaintiffs argue § 116-311 “violates the due process clauses of the United

States and North Carolina Constitutions” because they were “deprived of their

property rights in the contract, and their property rights in the chose of action that

they have acquired as a result of Defendant’s breach of said contract.” Plaintiffs

provide no authority in support of this argument. As with the Equal Protection

Clauses, the Due Process Clause of the Fourteenth Amendment to the United States

Constitution is “synonymous” with the “term ‘law of the land’ as used in Article I,

Section 19, of the Constitution of North Carolina,” see, e.g., In re Moore’s Sterilization,

289 N.C. 95, 98, 221 S.E.2d 307, 309 (1976), so our analysis is identical under both

the federal and State Constitutions.

¶ 66 The Supreme Court of the United States has long made clear “the State

remains free to create substantive defenses or immunities for use in adjudication . . .

.” See Logan v. Zimmerman Brush Co., 455 U.S. 422, 432, 71 L.E.2d 265, 276 (1982).

In such a case, “the legislative determination provides all the process that is due.” DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

Id. at 433, 71 L.E.2d at 276 (citing Bi-Metallic Investment Co. v. State Bd. of

Equalization, 239 U.S. 441, 445-46, 60 L.Ed. 372 (1915)). For example, in Martinez

v. California, 444 U.S. 277, 62 L.Ed.2d 481 (1980), the Supreme Court of the United

States “upheld a California statute granting officials immunity from certain types of

state tort claims.” See Logan, 455 U.S. at 432, 71 L.E.2d at 276. While “the grant of

immunity arguably did deprive the plaintiffs of a protected property interest . . . they

were not thereby deprived of property without due process” because of the legislative

determination. Id. at 432-33, 71 L.E.2d at 276. The only requirement was that the

legislative action had “a rational relationship” to the legislature’s “purposes.”

Martinez, 444 U.S. at 282, 62 L.Ed.2d at 487 (quotation marks omitted); see also

Martinez, 444 U.S. at 282, 62 L.Ed.2d at 487 (“[E]ven if one characterizes the

immunity defense as a statutory deprivation, it would remain true that the State’s

interest in fashioning its own rules of tort law is paramount to any discernible federal

interest, except perhaps an interest in protecting the individual citizen from state

action that is wholly arbitrary or irrational.”).

¶ 67 Here, faced with another immunity statute, we also only need to determine if

there was a rational relationship between § 116-311 and its purpose. See id. As laid

out above, the statute grants immunity to allow the Universities to fulfill their

academic missions. See N.C. Gen. Stat. § 116-313. As noted above in our discussion

of the reasonableness of the immunity statute when discussing the Contract Clause, DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

there is a rational relationship between the grant of immunity and that goal because

immunity freed up the Universities to focus on how to best deliver education online

rather than trying to continue in person and take all the public health measures

necessary to do that, which would have necessarily taken resources away from efforts

to ensure educational quality. Therefore, we reject Plaintiffs’ contention § 116-311

violates the Fourteenth Amendment’s Due Process Clause or our Constitution’s

corresponding Law of the Land Clause.

¶ 68 Fourth, Plaintiffs argue the immunity statute violates the Takings Clause of

the Fifth Amendment to the United States Constitution because their “chose in

action” from Defendant’s breach of contract is property that was taken without just

compensation. The only authority Plaintiffs cite in support of this contention is Frost

v. Naylor, 68 N.C. 325 (1873) and its statement “a chose in action is property.” See

Frost, 68 N.C. at 326. But Frost focused on “our Constitution,” not the federal

Constitution’s Takings Clause. See id. Plaintiffs present no caselaw showing a chose

in action, or a right to sue in general, see Chose in Action, Black’s Law Dictionary

(11th ed. 2019) (defining a chose in action as “[t]he right to bring an action to recover

a debt, money, or thing”), can be the basis of a Takings Clause violation under the

United States Constitution. Therefore, we reject this argument.

¶ 69 Finally, Plaintiffs argue § 116-311 unconstitutionally “intrudes upon the

separation of powers because it is a law that was passed in response to specific DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

litigation already pending in the courts with the purposes of directing the courts on

how to adjudicate the pending actions.” Plaintiffs provide no other argument, law, or

citations to support that argument; the entire argument is that sentence. As such,

even assuming arguendo passing a law in response to specific litigation already

pending would violate separation of powers, Plaintiffs have failed to provide any

evidence this law was passed in such a manner. Therefore, we reject Plaintiffs’

separation of powers argument.

¶ 70 Thus, after our de novo review we are not convinced beyond a reasonable doubt

that § 116-311 is unconstitutional. Because we uphold the constitutionality of § 116-

311 against all of Plaintiffs’ arguments and have already decided it applies to this

case, we now hold Plaintiffs’ claims are barred by statutory immunity. This holding

applies to bar Plaintiffs’ contract claims that survive sovereign immunity, and it also

represents an alternative bar to Plaintiffs’ unjust enrichment claims. Therefore, the

trial court did not err in dismissing Plaintiffs’ claims.

III. Conclusion

¶ 71 We affirm the trial court’s dismissal of Plaintiffs’ claims. Sovereign immunity

bars Plaintiffs’ unjust enrichment claims, but it does not bar their contract claims

because they have pled valid implied-in-fact contracts. Statutory immunity from N.C.

Gen. Stat. § 116-311 bars Plaintiffs’ contract claims and, in the alternative, their

unjust enrichment claims, because the statute applies to their claims based on its DIECKHAUS V. BD. OF GOVERNORS OF THE UNIV. OF N.C.

plain language and meaning and is constitutional.

AFFIRMED.

Judges COLLINS and CARPENTER concur.