                 IN THE COURT OF APPEALS OF TENNESSEE
                            AT KNOXVILLE
                                 November 12, 2002 Session

           TZE-PONG "RAYMOND" KU v. STATE OF TENNESSEE

                Appeal from the Claims Commission of the State of Tennessee
                   No. 20200433     Vance W. Cheek, Jr., Commissioner

                                  FILED DECEMBER 17, 2002

                                 No. E2002-01076-COA-R3-CV


Tze-Pong “Raymond” Ku (“Plaintiff”) is a student at the East Tennessee State University College
of Medicine (“College”). After completing his first two years of study, Plaintiff was required to take
the USMLE Step 1 examination. He took this examination and failed. Thereafter, the College
removed Plaintiff from his third year clerkships and eventually created a list of requirements he had
to meet in order to be allowed to resume his classes. After successfully suing the College in federal
court based on a procedural due process violation, Plaintiff brought the present lawsuit for damages
against the State of Tennessee claiming breach of written contract, to wit: his letter of acceptance
to the College and the College’s student handbook. The Claims Commission concluded these
documents did not constitute a written contract and dismissed the lawsuit for lack of subject matter
jurisdiction. Plaintiff appeals, and we affirm.



                    Tenn. R. App. P. 3 Appeal as of Right; Judgment of the
                       Claims Commission Affirmed; Case Remanded.


D. MICHAEL SWINEY, J., delivered the opinion of the court, in which HOUSTON M. GODDARD , P.J.,
and HERSCHEL P. FRANKS , J., joined.


Arthur F. Knight, III, and Samuel W. Brown, Knoxville, Tennessee, for the Appellant Tze-Pong
“Raymond” Ku.


Paul G. Summers, Attorney General, Michael E. Moore, Solicitor General, and Donald R. Ungurait,
Assistant Attorney General, Nashville, Tennessee, for the Appellee State of Tennessee.
                                              OPINION

                                             Background

                 This case involves a claim by Plaintiff against the State for breach of contract.
According to the complaint, Plaintiff was accepted to medical school and began his first year in the
fall of 1996. Plaintiff successfully completed his first and second year courses. During the summer
following the second year, Plaintiff was required to take the USMLE Step 1 examination, as set forth
in the College’s policies and procedures. This examination must be passed before the beginning of
the student’s fourth year. Plaintiff claims students who do not pass this examination are allowed to
begin their third year clerkships, but they are subject to dismissal if they do not pass this examination
after three attempts. Plaintiff failed the examination on his first attempt and intended to retake the
examination in October of 1998. Plaintiff began his third year clerkship in the summer of 1998, but
claims he was pulled from all of his rotations by the College’s administration. The reasons given
Plaintiff for being pulled from rotations were alleged behavioral problems. Plaintiff claims he never
was told of any behavioral problems prior to being pulled from the rotations.

                Plaintiff pursued the College’s internal appeal procedures in an attempt to maintain
his enrollment. He was denied relief at each level of the process. Plaintiff even underwent
psychological testing at the College’s request. In September of 1999, Plaintiff requested he be
allowed to return to his medical studies. In response, Daniel Wooten (“Wooten”), the Executive
Associate Dean for Academic and Faculty Affairs, sent Plaintiff a letter detailing certain conditions
Plaintiff had to agree to in order to return to classes. These conditions were: 1) Plaintiff’s retaking
his sophomore classes; 2) always being on time for class; and 3) being given a “battery” of oral
exams at the end of the 1999 fall semester and the 2000 spring semester which must be passed.
Plaintiff also was informed a structured evaluation of his performance would be conducted at the end
of each semester prior to his continuing in school. According to Wooten’s letter, only if Plaintiff
successfully completed the foregoing would he be allowed to retake the USMLE Step 1 examination.

                Plaintiff sued in federal court asserting, among other things, that he was denied
procedural due process by the College. On June 7, 2001, the United States District Court for the
Eastern District of Tennessee issued a memorandum opinion finding Plaintiff’s constitutional due
process rights had been violated. The United States District Court ordered the College to allow
Plaintiff to re-enter medical school, resume his junior clerkships, and take the USMLE Step 1
examination when he felt ready to do so.

              Plaintiff then brought this lawsuit against the State claiming breach of a written
contract. According to Plaintiff, he had a written contract for the provision of educational services
between him and the College by virtue of the College’s letter of acceptance, the College’s catalogs,
and other relevant written policies and procedures. Plaintiff sought one million dollars in
compensatory damages.




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              The State filed a motion to dismiss claiming there was no written contract as required
by Tenn. Code Ann. § 9-8-307(a)(1)(L), which provides for a cause of action against the State based
on:

               Actions for breach of a written contract between the claimant and the
               state which was executed by one (1) or more state officers or
               employees with authority to execute the contract ….

The State argued that because there was no written contract, the Claims Commission lacked subject
matter jurisdiction over the claim.

              Plaintiff responded to the motion to dismiss by claiming the East Tennessee State
University Medical Student Handbook (“Handbook” or “Catalog”) and his acceptance letter, both
of which were signed by a representative of the College, constituted a written contract. The
Handbook is signed by Wooten, and the introduction states, inter alia:

                        Complex social institutions such as medical schools must
               have pervasive rules that govern conduct and operational
               effectiveness. Thus, the James H. Quillen College of Medicine has
               proclaimed policies, procedures, and guidelines to monitor student
               affairs that are designed to ascertain that all members of our academic
               community are knowledgeable about what is expected of them and
               are treated justly.

                       The primary purpose of this manual is to incorporate into a
               single volume those policies, procedures, and guidelines that most
               directly impact students. Thus, it is imperative that all students
               familiarize themselves with the contents.

                       Obviously, no policy statement, whatever craft accompanies
               its establishment, can fully anticipate all situations. However, our
               College of Medicine recognizes its obligation to maintain
               responsiveness to individual needs. Therefore, any student who
               believes that individual circumstances justify action inconsistent with
               a certain policy stated herein should come to my office without
               hesitation.…

              At the beginning of the section of the Handbook setting forth the College’s Policies
and Procedures, the following “disclaimer” is found:




                                                -3-
                                                      Disclaimer

                  The policies contained herein are provided to give a general
                  understanding of the regulations governing East Tennessee State
                  University and the James H. Quillen College of Medicine. They are
                  subject to revision at any time with little or no advance notification.
                  The College of Medicine assumes no responsibility for errors in or
                  misrepresentation of these policies. For more information on the
                  official policies of ETSU and the College of Medicine contact the
                  Office of Academic Affairs.

                The Commissioner agreed with the State’s position and concluded there was no
written contract between the parties, and, therefore, dismissed the Complaint for lack of subject
matter jurisdiction. Plaintiff appeals, arguing the letter of acceptance and the Handbook constitute
a written contract.

                                                      Discussion

               Since matters outside the pleadings were considered by the Commission when it
granted the State’s motion to dismiss, we will treat the State’s motion as a motion for summary
judgment in accordance with Rule 12.02.1 The standard for review of a motion for summary
judgment is set forth in Staples v. CBL & Associates, Inc., 15 S.W.3d 83 (Tenn. 2000):

                         The standards governing an appellate court’s review of a
                  motion for summary judgment are well settled. Since our inquiry
                  involves purely a question of law, no presumption of correctness
                  attaches to the lower court’s judgment, and our task is confined to
                  reviewing the record to determine whether the requirements of Tenn.
                  R. Civ. P. 56 have been met. See Hunter v. Brown, 955 S.W.2d 49,
                  50-51 (Tenn. 1997); Cowden v. Sovran Bank/Central South, 816
                  S.W.2d 741, 744 (Tenn. 1991). Tennessee Rule of Civil Procedure
                  56.04 provides that summary judgment is appropriate where: (1) there
                  is no genuine issue with regard to the material facts relevant to the
                  claim or defense contained in the motion, see Byrd v. Hall, 847
                  S.W.2d 208, 210 (Tenn. 1993); and (2) the moving party is entitled
                  to a judgment as a matter of law on the undisputed facts. See
                  Anderson v. Standard Register Co., 857 S.W.2d 555, 559 (Tenn.

         1
            In relevant part, Rule 12.02 provides that if, “on a motion asserting the defense numbered (6) to dismiss for
failure to state a claim upon which relief can be granted, matters outside the pleading are presented to and not excluded
by the court, the motion shall be treated as one for sum mary judgm ent and dispo sed o f as pro vided in Rule 5 6, and all
parties shall be given re asonable o ppo rtunity to present all material mad e pertinent to such a m otion by Rule 56.”




                                                           -4-
               1993). The moving party has the burden of proving that its motion
               satisfies these requirements. See Downen v. Allstate Ins. Co., 811
               S.W.2d 523, 524 (Tenn. 1991). When the party seeking summary
               judgment makes a properly supported motion, the burden shifts to the
               nonmoving party to set forth specific facts establishing the existence
               of disputed, material facts which must be resolved by the trier of fact.
               See Byrd v. Hall, 847 S.W.2d at 215.

                       To properly support its motion, the moving party must either
               affirmatively negate an essential element of the non-moving party’s
               claim or conclusively establish an affirmative defense. See McCarley
               v. West Quality Food Serv., 960 S.W.2d 585, 588 (Tenn. 1998);
               Robinson v. Omer, 952 S.W.2d 423, 426 (Tenn. 1997). If the moving
               party fails to negate a claimed basis for the suit, the non-moving
               party’s burden to produce evidence establishing the existence of a
               genuine issue for trial is not triggered and the motion for summary
               judgment must fail. See McCarley v. West Quality Food Serv., 960
               S.W.2d at 588; Robinson v. Omer, 952 S.W.2d at 426. If the moving
               party successfully negates a claimed basis for the action, the non-
               moving party may not simply rest upon the pleadings, but must offer
               proof to establish the existence of the essential elements of the claim.

                       The standards governing the assessment of evidence in the
               summary judgment context are also well established. Courts must
               view the evidence in the light most favorable to the nonmoving party
               and must also draw all reasonable inferences in the nonmoving
               party’s favor. See Robinson v. Omer, 952 S.W.2d at 426; Byrd v.
               Hall, 847 S.W.2d at 210-11. Courts should grant a summary
               judgment only when both the facts and the inferences to be drawn
               from the facts permit a reasonable person to reach only one
               conclusion. See McCall v. Wilder, 913 S.W.2d 150, 153 (Tenn.
               1995); Carvell v. Bottoms, 900 S.W.2d 23, 26 (Tenn. 1995).

Staples, 15 S.W.3d at 88-89. A fact is “material” for summary judgment purposes, if it “must be
decided in order to resolve the substantive claim or defense at which the motion is directed.” Luther
v. Compton, 5 S.W.3d 635, 639 (Tenn. 1999)(quoting Byrd v. Hall, 847 S.W.2d at 211).

               Tenn. Code Ann. § 9-8-307 confers jurisdiction on the Tennessee Claims
Commission to entertain monetary claims against the State based upon certain specified causes of
action. Tenn. Code Ann. § 9-8-307(a)(1)(L) states that the Commission has jurisdiction to determine
a monetary claim against the State based upon “[a]ctions for breach of a written contract between
the claimant and the state which was executed by one (1) or more state officers or employees with



                                                 -5-
authority to execute the contract ….” What we must decide on this appeal is whether the undisputed
material facts demonstrate Plaintiff did not have a written contract with the State.

                Plaintiff’s main argument that the Handbook constitutes a written contract is based
on Lesure v. State, No. 89-347-II, 1990 Tenn. App. LEXIS 355 (Tenn. Ct. App. May 18, 1990). In
Lesure, this Court concluded there was a contract between that plaintiff and the state based on
Tennessee State University’s catalog. The catalog in that case, however, expressly stated the
provisions of the “catalog constitute a contract between the university and a student who commences
any program of study insofar as it relates to the degree requirements for that program during the
effective period of this catalog . . . .” Lesure, 1990 Tenn. App. LEXIS 355 at * 6. No such language
is contained in the College’s handbook. In addition to the quoted language, the Lesure case was
decided pursuant to a version of Tenn. Code Ann. § 9-8-307(a)(1)(L) which no longer exists. These
are distinctions with a difference, as recently noted by this Court in Petty v. State, 2002 Tenn. App.
LEXIS 193 (Tenn. Ct. App. Mar. 18, 2002), no appl. perm. appeal filed, which involved a claim that
the University of Tennessee’s student catalog constituted a written contract. In Petty, this Court
stated:

                       Plaintiff alleges that she has a written contract with the
               University of Tennessee which is embodied in the student catalog.
               She relies upon the unreported opinion of this Court in Lesure v.
               State, 1990 WL 64533 (Tenn. Ct. App. May 18, 1990), wherein this
               Court held that the catalog of Tennessee State University constituted
               a contract pursuant to Tenn. Code Ann. §9-8-307(a)(1)(L). Reliance
               on the Lesure case is misplaced, because the catalog at issue in
               Lesure expressly stated that its provisions constituted a contract
               between the university and the student, and the University of
               Tennessee catalog at issue does not. Moreover, the Lesure case was
               decided when a prior version of Tenn. Code Ann. §9-8-307(a)(1)(L)
               was in effect, which merely required the action to be founded upon
               “any express contract or breach thereof” but did not require the
               contract to be written and signed by an authorized officer or
               employee. Thus, the Lesure case is not applicable.

                       Finally, plaintiff seeks to bolster her argument that a written
               contract existed by stating that the University’s catalog, in
               conjunction with her transcript of grades which contains the signature
               of the registrar, satisfies the requirements of Tenn. Code Ann. §9-8-
               307(a)(1)(L). The transcript, however, does nothing more than report
               the grades which plaintiff earned in her course work. We find no
               language in the transcript which would constitute the terms of a
               contract.




                                                 -6-
                         As the Supreme Court observed in Johnson v. Central Nat'l
                  Ins. Co., 356 S.W.2d 277, 281 (Tenn. 1962):

                           While a contract may be either expressed or implied, or
                           written or oral, it must result from a meeting of the minds of
                           the parties in mutual assent to the terms, must be based upon
                           a sufficient consideration, free from fraud or undue influence,
                           not against public policy and sufficiently definite to be
                           enforced.

                  The transcript does not contain any definite terms to be enforced, and
                  does not result from a meeting of the minds. Reading it in
                  conjunction with the catalog is of no consequence, since the catalog
                  explicitly sets forth that its terms are subject to change without notice,
                  and that it should not be relied upon.

                        We hold that plaintiff has failed to satisfy the requirements of
                  Tenn. Code Ann. §9-8-307(a)(1)(L), and we affirm the
                  Commissioner’s Order dismissing this action.

Petty, 2002 Tenn. App. LEXIS 193 at ** 2-4. By way of footnote, the Petty Court observed the
University of Tennessee catalog contained a statement which told students that its provisions were
constantly under review, subject to change at any time, and should not be relied upon. Id. at *3 fn.1.

                We believe the present case is quite similar to Petty. The Handbook does not state
it is intended to be a contract. The Handbook acknowledges the difficulty in anticipating all
situations, and that the contents of the Handbook are subject to revision at any time “with little or
no advance notification.” Furthermore, the College expressly assumed no responsibility for errors
in or misrepresentations of the policies. After reviewing the entire Handbook2, it is our opinion the
undisputed material facts demonstrate the State did not intend to be contractually bound to the
contents of the Handbook. Cf. Smith v. Morris, 778 S.W.2d 857, 858 (Tenn. Ct. App. 1988)(While
a handbook can be part of an employment contract, “the specific language of the handbook must
show contractual intent.”). We agree with the Commission that the College’s Handbook does not
constitute a written contract.

                Plaintiff also argues the letter wherein he was accepted to the College also constitutes
a written contract. The letter is dated July 14, 1992, and extends an offer to Plaintiff to “join East
Tennessee State University’s Premedical-Medical Program.” The letter also explains certain
requirements Plaintiff must undertake should he choose to accept the invitation. The undisputed
material facts show: a) Plaintiff was offered acceptance into the College; b) Plaintiff accepted the


         2
           Plaintiff claims the Handb ook constitutes a contract, but points us to no specific language evidencing the
College’s intent to be contractually bo und to its contents.

                                                         -7-
offer; and c) Plaintiff was admitted into the College. Even assuming, without deciding, the offer to
join the College’s medical program was a written contract for purposes of Tenn. Code Ann. § 9-8-
307(a)(1)(L), this contract had long since been completed by the time the events giving rise to the
present lawsuit occurred and, therefore, cannot form the basis of the present lawsuit.

                The written documents relied upon by Plaintiff, either separately or together, do not
constitute a written contract. Therefore, the decision of the Claims Commission dismissing
Plaintiff’s claim for lack of subject matter jurisdiction was proper. We hold Plaintiff has failed to
satisfy the requirements of Tenn. Code Ann. § 9-8-307(a)(1)(L), and we affirm the Commissioner’s
Order dismissing this action.

                                            Conclusion

              The judgment of the Claims Commission is affirmed, and this cause is remanded to
the Claims Commission for such further proceedings as may be required, if any, consistent with this
Opinion. The costs on appeal are assessed against the Appellant Tze-Pong “Raymond” Ku, and his
surety.



                                                      ___________________________________
                                                      D. MICHAEL SWINEY, JUDGE




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