Dailey v. University of Portland

80 April 23, 2025 No. 361

IN THE COURT OF APPEALS OF THE

STATE OF OREGON

Stephen K. DAILEY,

Plaintiff-Appellant,

v.

UNIVERSITY OF PORTLAND,

Defendant-Respondent.

Multnomah County Circuit Court

23CV22882; A183476

Beth A. Allen, Judge.

Argued and submitted March 21, 2025.

Kevin Brague argued the cause and filed the briefs for

appellant.

Melissa Lehane Rawlinson argued the cause for respon-

dent. Also on the brief were Michael Porter and Miller Nash

LLP.

Before Tookey, Presiding Judge, Jacquot, Judge, and

Kistler, Senior Judge.

KISTLER, S. J.

Reversed as to the contract claim; otherwise affirmed.

Cite as 340 Or App 80 (2025) 81

KISTLER, S. J.

Plaintiff appeals a judgment dismissing his contract

and negligence claims. He argues that the trial court erred,

in ruling on summary judgment, that statements in defen-

dant’s handbooks did not give rise to contractual obligations

and that no special relationship existed that would permit

him to recover economic and emotional distress damages.

We affirm the trial court’s judgment in part and reverse it

in part.

Because this case arises on defendant’s motion

for summary judgment, we set out the historical facts in

the light most favorable to plaintiff and draw all reason-

able inferences from those facts in his favor. Defendant’s

school of nursing offers a doctor of nursing practice degree.

That degree allows students who are registered nurses to

be licensed as nurse practitioners, which in turn permits

them to exercise greater responsibility in caring for their

patients.

In 2015, defendant accepted plaintiff as a student

in its doctoral nursing program. A student in that program

can pursue one of three tracks. Plaintiff chose the track that

would permit him to graduate with a degree as a family

nurse practitioner. To obtain that degree, plaintiff had to

complete a specific sequence of academic and clinical courses

within a six-year period.

In 2017, plaintiff took a reduced course load to care

for his wife, who was suffering from cancer. In 2018, he took

a leave of absence because of his wife’s illness. Three years

later, defendant granted plaintiff’s application to re-enroll in

its doctoral nursing program. It also extended the deadline

for completing his academic and clinical courses to 2023.

Plaintiff’s first clinical course began in the fall 2021

semester. Difficulties arose, however, in finding a suitable

clinic. His initial clinical placement was canceled, and he

was unsuccessful in securing a potential clinical place-

ment in Bend. According to plaintiff, those difficulties arose

because defendant had accepted more nursing students

than it could place in suitable clinics.

82 Dailey v. University of Portland

After the fall 2021 semester began, defendant told

plaintiff that a clinical placement was available in Grants

Pass, which plaintiff accepted. Each nursing student in a

clinic is supervised by a medical professional, who is referred

to as a preceptor. Defendant’s bulletin listing its courses

states:

“Ideally, the [doctor of nursing practice] student preceptor

is an advanced practice registered nurse (APRN), although

students may also be precepted by MDs, DOs, PAs, and

CNMs. In adherence to the Oregon State Board of Nursing’s

requirements, all students must have a minimum of 51% of

their total program clinical hours precepted by a licensed

APRN within the same APRN role.”1

Additionally, defendant’s bulletin states that APRNs who

serve as preceptors must have a minimum of 2,080 hours

licensed experience, which it describes as approximately

two-years of licensed experience.

The preceptor who supervised plaintiff during the

fall 2021 clinical course was available only part of the time.

Despite her limited availability and despite the initial delay

in finding an available clinical placement, plaintiff com-

pleted his first clinical course successfully. The preceptor who

supervised plaintiff during the fall 2021 semester was not

available during the spring 2022 semester. Two other precep-

tors took her place. Plaintiff asserts that neither of those pre-

ceptors was qualified to supervise him because each lacked

2,080 hours of experience as a licensed nurse practitioner.2

According to plaintiff, the two preceptors gave him

positive feedback on his work during the spring semester.

However, at some point before April 15, 2022, defendant

1

A clinical nurse specialist, a nurse practitioner, and a certified registered

nurse anesthetist qualify as APRNs. See ORS 678.025.

2

Contrary to plaintiff’s assertion, one preceptor who supervised him during

the spring semester appears to have had the requisite experience. Plaintiff sub-

mitted records in response to defendant’s summary judgment motion that one

preceptor who supervised him in spring 2022 received her license as a nurse

practitioner on October 2, 2019. She thus would have had more than two years

of experience as a licensed nurse practitioner before the spring 2022 semester

began. If she worked 40 hours per week for 50 weeks each year, she would have

had approximately 4,000 hours of licensed experience by January 2022. As plain-

tiff correctly notes, a reasonable juror could infer that the other preceptor had

less than 2,080 hours of licensed experience as a nurse practitioner.

Cite as 340 Or App 80 (2025) 83

received negative feedback on plaintiff’s performance, which

resulted in defendant’s sending plaintiff a “development and

improvement plan” form. That form notifies the student about

complaints, provides the student with an opportunity to

respond in writing, and allows the student and faculty adviser

to form a plan to correct any deficiency. The record does not

disclose the complaint that gave rise to plaintiff’s receipt of

the form, nor does it disclose how any deficiency was resolved.

At the end of the spring semester, plaintiff’s gradu-

ate adviser gave him a no-pass grade for the clinical course

that semester. There is no direct evidence in the record as to

why plaintiff received that grade.

In May 2022, plaintiff met with his graduate advisor,

a clinical instructor, and the academic dean for the nursing

school. Initially, the graduate advisor told plaintiff that he

was being dismissed from the school of nursing. At some later

point, the dean told plaintiff that he was not being dismissed,

that he remained a student in good standing, and that the

dean would provide him with a letter of recommendation. The

dean explained that plaintiff could obtain his degree only if he

successfully retook the spring 2022 clinical course. He added,

however, that plaintiff could not retake the spring 2022 clini-

cal course and complete the remaining academic and clinical

courses needed for his degree by 2023, the deadline for obtain-

ing the degree. Finally, the dean told plaintiff that his tuition,

presumably for the spring 2022 semester, would be refunded

if he withdrew from the university that day.

Plaintiff withdrew and brought this action for breach

of contract and for negligence, seeking economic and emotional

distress damages. As we understand plaintiff’s arguments,

both his contract and negligence claims rest on the factual

premise that the clinical opportunities defendant provided

were deficient (particularly the absence of qualified preceptors

during the spring 2022 semester) and that defendant’s failure

to provide adequate clinical opportunities effectively resulted

in plaintiff’s forced withdrawal from the university, which in

turn led to his economic and emotional distress damages.

Defendant moved for summary judgment on both

claims for relief. We begin with plaintiff’s contract claim.

84 Dailey v. University of Portland

As we understand defendant’s summary judgment motion,

its argument ran as follows. Plaintiff’s contract claims are

based on statements contained in three documents that

defendant provided its students: a graduate nursing hand-

book, a general student handbook, and an online bulletin

listing its course offerings. Defendant observed that each

of those documents contained a disclaimer, each of which

expressly provided that no statements contained in that

document gave rise to contractual obligations.

In defendant’s view, those disclaimers were dispos-

itive. Put differently, defendant appears to have assumed,

for the purposes of its summary judgment motion, that the

statements in its handbooks and online bulletin could give

rise to contractual obligations in the absence of its disclaim-

ers. It argued, however, that the disclaimers prevented those

statements from being converted into binding contractual

obligations.

Plaintiff responded that the Oregon Supreme Court

recognized over 100 years ago that, when students rely on

statements in a university handbook describing the pre-

requisites for obtaining a degree, those statements become

contractually binding obligations. See Tate v. North Pacific

College, 70 Or 160, 165, 140 P 743 (1914).3 He argued that

the same rule applies here. Alternatively, he argued that the

disclaimers on which defendant relied were not valid because

they were not conspicuous, they were ambiguous, and they

violated public policy. The trial court was not persuaded by

plaintiff’s arguments; rather, it found the disclaimers dis-

positive and granted summary judgment on that basis. The

parties essentially reiterate their arguments on appeal.

With that preface, we turn to the two documents on

which plaintiff’s contract claim rests—the graduate nurs-

ing handbook and its online bulletin describing its course

3

The court recognized in Tate that statements in a university’s handbook can

give rise to contractual obligations; that is, the court assumed that, if the plain-

tiff had satisfied the degree requirements set out in the university’s handbook,

the university’s refusal to give him a degree would have breached its contractual

obligations. 70 Or at 165. The court held, however, that the university had not

acted arbitrarily in giving the plaintiff a failing score on a required examina-

tion, which meant he was not eligible under the terms set out in its handbook to

receive the degree. Id. at 168-69.

Cite as 340 Or App 80 (2025) 85

offerings.4 We begin with the graduate nursing handbook.

After describing defendant’s program for doctoral nursing

students, the handbook states:

“The program incorporates professional standards and

guidelines from [six publications identifying standards

and competencies] for students in the [family nurse prac-

titioner] track, [one publication listing competencies] for

students in the [adult gerontology primary care nurse prac-

titioner track], and the Oregon State Board of Nursing in

preparation of the curriculum and evaluation of outcomes.”

Plaintiff reasons that the last reference to standards and

guidelines from the Oregon State Board of Nursing incorpo-

rated either all or part of the rules set out in OAR chapter

851, governing the standards that a nursing education pro-

gram must meet. He contends that those rules gave rise to

the contractual obligations that defendant breached.

As noted above, defendant based its summary judg-

ment motion on the disclaimer found on the first printed

page of the graduate nursing handbook. It argued that that

disclaimer precluded the formation of any contractual obli-

gations based on that handbook’s contents. The disclaimer

states:

“The School of Nursing Graduate Student Handbook has

been written to provide the student with information spe-

cific to the curriculum, student rights and responsibilities,

campus facilities, and resources related to nursing stu-

dents. It is meant to augment, not supersede, information

provided in [a general student handbook and a bulletin

setting out defendant’s course offerings]. Every effort has

been made to ensure its accuracy. Its contents do not consti-

tute a contract between the School of Nursing (SON) and its

students. If regulations, program requirements, or services

described herein conflict with more current practice, the

latter will prevail.”

(Emphasis added.)

4

Plaintiff argues that each document independently gives rise to his con-

tract claim. Plaintiff has asserted that other documents, including the general

student handbook, gave rise to his contract claim. However, he has not identified

any statement in any document other than the graduate nursing handbook and

the online bulletin that allegedly gave rise to the contractual obligations that

defendant breached.

86 Dailey v. University of Portland

As defendant argues, we have long recognized that

conspicuous disclaimers can prevent statements in a hand-

book or manual from giving rise to contractual obligations.

Mobley v. Manheim Services Corp., 133 Or App 89, 93-94,

889 P2d 1342, rev den, 321 Or 47 (1995); Gilbert v. Tektronix,

Inc., 112 Or App 34, 37-38, 827 P2d 919, rev den, 313 Or

299 (1992). In this case, defendant’s disclaimer is conspicu-

ous. It follows immediately after the table of contents and is

on the first page of text in the graduate nursing handbook.

See American Wholesale Products v. Allstate Ins. Co., 288 Or

App 418, 427-28, 406 P3d 163 (2017) (holding that a similar

disclaimer was conspicuous). The disclaimer is not ambigu-

ous, and plaintiff did not raise a claim below, as he attempts

to do on appeal, that the disclaimer is void in violation of

public policy.5

Plaintiff identifies a second independent source for

defendant’s contractual obligation—defendant’s online bul-

letin listing its course offerings. In moving for and oppos-

ing summary judgment, the parties submitted screenshots

from defendant’s bulletin that identify part of its contents.

Those screenshots, however, provide little help in determin-

ing whether defendant’s disclaimer is placed conspicuously

on the website where its bulletin can be found. That is, the

screenshots reveal what various webpages say, but they pro-

vide no insight into determining how prominent or conspic-

uous the webpage containing the disclaimer is.

The affidavit in support of defendant’s motion for

summary judgment provides greater help. It includes a link

to the specific webpage in the 2021-22 bulletin on which its

disclaimer is found; moreover, as the affidavit notes, the

link provides full access to the 2021-22 bulletin. The open-

ing page or homepage of the 2021-22 bulletin contains a

5

At oral argument, plaintiff raised an additional argument. He contended

that defendant owes him other contractual obligations that the disclaimer does

not negate. Even if that is true, it is difficult to see how that argument advances

his contract claim here. To the extent that plaintiff’s contract claim in this case

is based on statements in the graduate nursing handbook, the disclaimer pre-

vented those statements from becoming contractual obligations. Cf. Mobley, 133

Or App at 94-95 (holding that a disclaimer in an employee’s manual prevented

statements in that manual from conferring specific contractual rights without

questioning whether the plaintiff retained the contract right to be paid at the

agreed price for the work he had performed).

Cite as 340 Or App 80 (2025) 87

picture of the university. To the left of that picture is a table

of contents for the bulletin that lists 24 subjects. The list

begins: “University Calendar,” “The University of Portland,”

“General Information,” “University Academic Programs

of Study,” and so on. In order to find the disclaimer, a

reader must click on the link captioned “The University of

Portland.” Doing so takes a reader to a webpage display-

ing a second table of contents that lists nine subjects. That

list begins: “Notes About This Bulletin,” “Contacts,” “Equal

Opportunity and Nondiscrimination Policy,” and so on. Only

if a reader clicks on the link captioned “Notes About This

Bulletin” will they come to the disclaimer on which defen-

dant relies.

We cannot say, as a matter of law, that the dis-

claimer is conspicuous. Nothing on the homepage suggests

that any disclaimer will be found under the heading “The

University of Portland” rather than the heading “General

Information” or elsewhere. Indeed, a casual reader could not

be faulted for thinking that the heading “The University

of Portland” would lead to a discussion of the history of the

university, its founders’ mission, or a travelogue-type dis-

cussion of the university’s scenic location overlooking the

Willamette River.

If a reader happened to click on the link captioned

“The University of Portland,” and noted the table of contents

that appeared, the caption “Notes About This Bulletin”

might suggest that that subject contained pertinent infor-

mation, such as a contract disclaimer. “Notes,” however, is

a general term that does not identify the type of notes that

might be included on that webpage. Only if reader went

through two relatively opaque webpages would they find the

disclaimer.

To be sure, the website for the bulletin contains a

search function. A search function, however, provides a use-

ful means of discovering the disclaimer only if a reader is

aware that a disclaimer might exist and is actively looking

for it. Beyond that, plaintiff’s counsel submitted an affidavit

in opposition to summary judgment stating that he did not

find the disclaimer using the search function. We cannot say

on summary judgment that the disclaimer in defendant’s

88 Dailey v. University of Portland

bulletin is conspicuously or prominently displayed on defen-

dant’s website; instead, it is tucked away in a mousehole. Cf.

Anderson v. Ashland Rental Inc., 122 Or App 508, 510-11,

858 P2d 470 (1993) (holding that a limitation on warranties

was not conspicuous because it was printed using a small

font and light typeface). The trial court erred in granting

summary judgment on plaintiff’s contract claim based on

the disclaimer in defendant’s bulletin.6

Our holding on plaintiff’s contract claim is narrow.

We hold only that the disclaimer in defendant’s bulletin does

not prevent the statements in that bulletin from giving rise

to contractual obligations. As we read defendant’s brief on

appeal, it does not ask us to uphold the trial court’s ruling

on another ground under the “right for the wrong reason”

doctrine. Indeed, in light of the narrow focus of defendant’s

summary judgment motion, applying that doctrine could

raise procedural problems. See Two Two v. Fujitec America,

Inc., 355 Or 319, 324-25, 325 P3d 707 (2014) (explaining, but

not holding, that ORCP 47 C requires the party with the

burden of proof to offer evidence only on the issues raised

in the summary judgment motion). We accordingly express

no opinion on any other contract issues that might arise on

remand.

We turn to plaintiff’s negligence claim. Plaintiff

seeks to recover economic and emotional distress damages

based on defendant’s allegedly negligent failure to provide

adequate clinical opportunities and instruction. Ordinarily,

in the absence of a physical injury, the damages that plain-

tiff seeks are not available for mere negligence. See Moody

v. Oregon Community Credit Union, 371 Or 772, 784-85, 542

P3d 24 (2023) (emotional distress damages); Onita Pacific

Corp. v. Trustees of Bronson, 315 Or 149, 159, 843 P2d 890

(1992) (economic loss). As the court explained in Moody, the

potential for unlimited liability when a plaintiff seeks emo-

tional distress damages flowing from mere negligence is so

6

Defendant argued at oral argument that the disclaimer in its graduate

nursing handbook applies to the statements in the bulletin. The disclaimer in

the graduate nursing handbook, however, states that “[i]ts contents” do not create

contractual obligations. The disclaimer in the general student handbook is sim-

ilarly limited. By their terms, those disclaimers do not apply to the contents of

defendant’s other documents. At least, we cannot say so on summary judgment.

Cite as 340 Or App 80 (2025) 89

great that courts have restricted either the class of plain-

tiffs who can seek those damages or the instances in which

they are recoverable. See 371 Or at 785 (citing Philibert v.

Kluser, 360 Or 698, 703-04, 385 P3d 1038 (2016)); accord

Onita Pacific Corp., 315 Or at 159 (economic loss).

Plaintiff does not dispute those general principles.

Rather, he relies on rules promulgated by the Oregon State

Board of Nursing (the board) that establish the standards a

nursing education program must meet. He argues, among

other things, that those regulations provide an independent

standard of care that permits him to recover economic and

emotional distress damages. Alternatively, and perhaps

additionally, he argues that, as a matter of Oregon common

law, a “special relationship” existed between the parties that

imposed a heightened standard of care on defendant. That

was sufficient, in plaintiff’s view, to allow him to recover

economic and emotional distress damages.

Before addressing plaintiff’s rule-based argument,

we first describe briefly the applicable statutory and regu-

latory structure. ORS chapter 678 authorizes the board to

establish standards for licensing different classifications

of nurses; to prescribe the tasks that each classification of

nurses can perform; to determine whether applicants for

specific nursing licenses are qualified; and to “prescribe

standards and approve curricula for nursing education pro-

grams in this state.” ORS 678.150(5), (6)(a)-(i). Pursuant to

the last delegation of legislative authority, the board has

adopted rules that identify the standards nursing programs

in Oregon must meet before the board will approve them to

educate nursing students.

As applicable here, the board’s rules describe the

subjects that nursing programs offering nurse-practitioner

degrees must include in their curriculum. See OAR 851-051-

0020(2)(a)-(e). They prescribe the professional licenses that

the faculty who educate nurse practitioners must have. OAR

851-051-0020(4). And they specify the professional licenses

that preceptors must have to supervise those students in

clinics; among other things, the board’s rules require that

preceptors have “[a] minimum of 2080 hours of licensed

practice.” OAR 851-051-0020(5)(A), (D).

90 Dailey v. University of Portland

If a nursing education program meets those and

other standards, the board will approve that program “for

a period of three years with subsequent approvals aligning

with the frequency of national program accrediting surveys.”

OAR 851-051-0050(1). Nursing education programs that

receive board approval must submit a report to the board if

certain changes occur in their programs, such as moving to

another location. OAR 851-051-0050(4) (listing the changes

that will require a report). The board also retains author-

ity to make interim site surveys to address issues reported

to it. OAR 851-051-0050(3). Finally, the board’s rules pro-

vide that, “[i]f, in the opinion of the [b]oard, the established

standards for a new or existing program are not being met,

notice must be made to the program specifying the deficien-

cies and the time frame within which correction must occur.”

OAR 851-051-0050(2). The board’s rules thus vest the board

with the authority and discretion to decide how to enforce

the rule-based standards on which its approval of nursing

education programs depends.

With that background in mind, we return to plain-

tiff’s arguments. Plaintiff relies on the board’s rules for a

series of related but separate propositions. At the most basic

level, he appears to argue that the board’s rules establish

a standard of care that is separate from and higher than

the standard of care that ordinarily applies in negligence

actions—namely, the obligation to avoid “unreasonably cre-

at[ing] a foreseeable risk to a protected interest of the kind

of harm that befell the plaintiff.” See Fazzolari v. Portland

School Dist. No. 1J, 303 Or 1, 17, 734 P2d 1326 (1987). Even

if that is true, that does not advance his claim. It merely

establishes that a higher standard of care applies, not that

he necessarily can recover economic and emotional distress

damages for a breach.

Additionally, plaintiff relies on the board’s rules as

a basis for arguing that he can assert a negligence claim

independently of his contract claim. See Georgetown Realty v.

The Home Ins. Co., 313 Or 97, 106, 831 P2d 7 (1992) (explain-

ing that a party can bring contract and tort claims arising

out of a contractual relationship when the two claims turn

on separate standards of care). Again, even if we assume

Cite as 340 Or App 80 (2025) 91

that the board’s rules provide a separate standard of care

from his contract claim, that does not necessarily establish

that plaintiff can recover economic or emotional distress

damages if defendant negligently fails to follow those rules.

Finally, plaintiff argues that our decision in Moody

v. Oregon Community Credit Union, 317 Or App 233, 505 P3d

1047 (2022), aff’d on other grounds, 371 Or 772, 542 P3d 24

(2023), establishes that his negligence claim is actionable.

In our view, both our opinion and the Supreme Court’s opin-

ion in Moody cut against plaintiff’s claim here. The question

in Moody was whether the beneficiary of a life insurance

policy could recover emotional distress damages when the

insurer “negligently performed its obligations under [ORS]

746.230 in its review, investigation, and eventual decision to

deny insurance benefits[.]” 371 Or at 776 (internal quotation

marks omitted).

The Supreme Court and we differed over the role

that ORS 746.230 played in the plaintiff’s tort claim. We

held that the plaintiff could rely on that statute to state

a negligence per se claim for emotional distress damages

without first showing that the plaintiff had an actionable

common-law negligence claim. 317 Or App at 241-43. The

Supreme Court disagreed with that conclusion. 371 Or at

781-82. It explained that a plaintiff could state a negligence

per se claim for emotional distress damages only if the plain-

tiff had an existing common law negligence claim for those

damages. Id. at 782. Addressing that issue, the Supreme

Court reasoned that the statute on which the plaintiff relied

was relevant to the extent it indicated that the insurer’s

negligence invaded a separate, appropriately cabined legally

protected interest. Id. at 783-92. As the Supreme Court’s dis-

cussion of that issue illustrates, the issue is not a simple one.

Ultimately, however, both our and the Supreme

Court’s conclusion that the plaintiff had stated an action-

able negligence claim for emotional distress damages rested

on the premise that the statute on which the plaintiff relied

reflected a legislative intent to protect the plaintiff’s peace of

mind. See 371 Or at 798-800. The Supreme Court explained

that people buy insurance policies not only for the monetary

payout those policies provide when a covered loss occurs but

92 Dailey v. University of Portland

also to provide the policyholder with peace of mind. Id. at

797-98. The court reasoned that the statutory requirement

that insurers promptly investigate and pay valid claims

was intended to “ ‘ensure that the insurance-buying public

gets what it pays for, including the peace of mind that is a

principal benefit of an insurance policy.’ ” Id. at 798 (quoting

Moody, 317 Or App at 247 (emphasis added)).

Given that statutory purpose, the court concluded,

after further analysis, that the applicable statutes identi-

fied a separate “legally protected interest” that permitted

the plaintiff to recover emotional distress damages flowing

from the defendant’s negligent failure to promptly inves-

tigate and pay her life insurance claim. We need not pur-

sue the lengthy analysis that the Supreme Court laid out

in Moody to resolve plaintiff’s reliance on the board’s rules

here. Unlike the statutes on which the plaintiff relied in

Moody, a principal purpose of board’s rules is not to pro-

tect students’ economic and emotional wellbeing. Rather,

as defendant notes, the stated reason why the board sets

standards for nursing education programs is “to foster the

safe and effective practice of nursing by [the] graduates

of nursing education programs” that the board regulates.

See OAR 851-021-0000 (stating that purpose).7 It is for that

reason—the protection of the public—that the board

approves nursing education programs, decides when a

nursing education program is out of compliance with its

rule-based standards, and determines the necessary steps

to remedy any deficiency. Without a basis for saying that

a principal or primary purpose of the board’s rules is to

protect a student’s economic and emotional wellbeing, and

plaintiff does not identify one, those rules do not support

plaintiff’s recovering economic and emotional distress dam-

ages resulting from defendant’s alleged negligence.

Having concluded that the rules on which plaintiff

relies do not support recovering economic and emotional

7

OAR 851-021-0000 states the purpose for providing standards for pro-

grams educating practical and registered nurses. OAR 851-051-0020 provides

standards for programs educating nurse practitioners. Although OAR 851-051-

0020 does not repeat the purpose identified in OAR 851-021-0000, we conclude

that the stated purpose applies equally to the standards the board sets for pro-

grams educating nurse practitioners.

Cite as 340 Or App 80 (2025) 93

distress damages for their breach, we turn to his common-law

argument that a special relationship exists that permits the

recovery of those damages. The seminal case on that issue

is Onita Pacific Corp. The plaintiffs in that case had pur-

chased several lots from the defendants and had relied on

the defendants’ representation that the escrow agent would

be instructed to release some of the lots immediately once

the sale closed. 315 Or at 153-54. The escrow agent, however,

did not release any of the lots immediately, and it turned

out that the escrow instructions differed from the defen-

dants’ representations. Id. at 154-55. The plaintiffs brought

an action to recover the economic losses they suffered as a

result of the defendants’ negligent misrepresentations.

In deciding whether the plaintiffs had stated an

actionable negligence claim, the court started from the now

familiar proposition that “a negligence claim for the recov-

ery of economic losses caused by another must be predicated

on some duty of the negligent actor to the injured party

beyond the common law duty to exercise reasonable care to

prevent foreseeable harm.” Id. at 159 (footnote omitted). As

the court framed the issue, it reduced to whether the “defen-

dants owed [the] plaintiffs a duty to exercise reasonable care

in communicating factual information to prevent economic

losses to [the] plaintiffs.” Id. at 160.

Having framed the issue that way, the court

reviewed cases in which it had recognized a right to recover

economic loss for negligent acts. It explained that some pro-

fessionals, such as attorneys, engineers, and real estate

brokers, owe a duty of care, “at least in part, [of] acting

to further the economic interests of the ‘client,’ the person

owed the duty of care.” Id. at 160-62. The court concluded,

however, that no such duty of care existed in arms-length

negotiations; as a result, “in arms-length negotiations, eco-

nomic losses arising from a negligent misrepresentation are

not actionable.” Id. at 161-62. That was true in Onita Pacific

Corp. even though the plaintiffs in that case had entrusted

the defendants with requesting escrow instructions that

tracked the representations that the defendants had made.

The court added a gloss on Onita Pacific in Conway

v. Pacific University, 324 Or 231, 924 P2d 818 (1996). In

94 Dailey v. University of Portland

Conway, the court noted that an attribute of a special rela-

tionship is that

“one party has relinquished control over the subject mat-

ter of the relationship to the other party and has placed

its potential monetary liability in the other’s hands. In all

those relationships, one party has authorized the other to

exercise independent judgment in his or her behalf and,

consequently, the party who owes the duty has a special

responsibility to administer, oversee, or otherwise take

care of certain affairs belonging to the other party.”

Id. at 241. Applying that standard, the court held that, even

though the dean at Pacific University had told a professor

(the plaintiff) that poor student evaluations “will not be a

problem” in receiving tenure, no special relationship existed

between the university and the professor that would permit

him to recover economic damages for what turned out to be

the dean’s negligent misrepresentation. Id. at 233-34, 242.

In reaching that conclusion, the court assumed that

some provisions in the university’s handbook required the

dean to act in ways that furthered the professor’s economic

interests. Id. at 242. It concluded, however, that “nothing

in those provisions demonstrates that the university had a

special responsibility to exercise independent judgment in

[the professor’s] behalf.” Id. at 242, 242 n 6. For that rea-

son, Conway held that the plaintiff had not stated an action-

able negligence claim. Id. at 244. Put differently, Conway

required both a duty to protect against economic loss and

the exercise of independent judgment to state a negligence

claim for economic loss.

This case is the reverse image of Conway. That is,

defendant may have exercised independent judgment in

deciding which clinical programs were suitable for its stu-

dents and which preceptors were qualified to supervise

them. However, plaintiff identifies no basis for saying that,

in exercising its judgment, defendant was acting to further

its students’ economic and emotional wellbeing. Rather, as

explained above, defendant sought to provide a sound edu-

cation to its students to protect the public—namely, to foster

the safe and effective practice of medicine once its students

became licensed nurse practitioners.

Cite as 340 Or App 80 (2025) 95

It may be that providing a sound education to defen-

dant’s students will have the incidental effect of increasing

their earning capacity and avoiding emotional distress now

or in the future once they begin their practice. But that inci-

dental effect is not comparable to the interests that, as a

matter of common law, have led Oregon courts to recognize

a special relationship that justifies recovering economic or

emotional distress damages flowing from a defendant’s neg-

ligence. See Curtis v. MRI Imaging Services II, 327 Or 9,

14-16, 956 P2d 960 (1998) (holding that, “when the standard

of care in a particular medical profession * * * dictates that

certain precautions be taken to avoid or minimize [adverse

psychological reactions],” then the negligent breach of that

duty can give rise to emotional distress damages); see Onita

Pacific Corp., 315 Or at 160-62 (identifying instances in

which the defendant’s duty included an obligation, at least

in part, to protect another from foreseeable economic loss).

Plaintiff cites no case from Oregon or elsewhere

holding that, in the absence of a physical injury, a student

can recover economic or emotional distress damages for a

university’s negligent failure to provide an adequate edu-

cation. Instead, plaintiff cites a handful of cases from other

states that have recognized a school’s special duty to protect

its students from third-party assaults and other forms of

violence. Oregon courts have recognized a similar duty. See

Fazzolari, 303 Or at 19-20 (holding that high schools owe

a “special duty” to their students to take “reasonable pre-

cautions against foreseeable risks beyond those that might

apply to other persons”).

As we read Fazzolari and Onita Pacific Corp., they

teach that the question whether a special duty or special

relationship exists is contextual. The fact that a special

relationship exists in one context does not necessarily mean

that it exists in another. Put differently, even if universi-

ties have a special duty in certain circumstances to protect

their students from third-party harm, it does not follow that

a special relationship exists to protect those students from

economic loss and emotional distress. We conclude that nei-

ther the regulations on which plaintiff relies nor the com-

mon law cases he cites give rise to a special relationship

96 Dailey v. University of Portland

in this case that would permit plaintiff to recover economic

or emotional distress damages. The trial court correctly

granted summary judgment on plaintiff’s negligence claim.

Reversed as to the contract claim; otherwise

affirmed.