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Québec: full refunds ‘unlikely’ in M College case

More than 500 international students who paid tuition to three Québec colleges that later filed for creditor protection are unlikely to receive a full refund, the accounting firm overseeing the college restructuring has indicated.

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A further 308 students who paid their tuition in advance are still waiting for a study permit

Richter Inc. suggested that 502 students who have had their study permit request denied, or withdrew their applications from the colleges, will have to get in line with other unsecured creditors. Almost all of the students are from India.

In a court filing this month, Richter said any money the students receive “is likely to represent a small fraction of the refund claim amount”.

Each student paid between $28,000 and $30,000 to attend the colleges. According to the court filing, 633 students have requested refunds totalling $6.4 million. In addition, $5m in tuition has been paid by students waiting for a decision on their study permit application.

Richter has found a buyer for the private colleges. The new owner is Cestar, which operates private colleges in the Toronto area in partnership with Lambton College, a public institution based in Sarnia, Ontario.

The colleges will be reopening for online classes. Students who are near graduation are expected to be able to complete their courses by summer.

The three Québec colleges entered creditor protection in January, just weeks after demanding that students pay their tuition in advance. The institutions are: M College in Montreal, CDE College in Sherbrooke and CCSQ, which has campuses in Longueuil and Sherbrooke.

A further 308 students who paid their tuition in advance are still waiting for a study permit. If a visa is refused, Cestar will refund their tuition fees, according to Olivier Benchaya, a partner in Richter’s restructuring group.

Meanwhile, Danielle McCann, Québec’s minister of higher education, said in a statement that she plans to implement measures “to ensure that this type of situation never occurs again”.

The measures include evaluating the process “for issuing, renewing or modifying permits for private colleges”, she said.

Students have led protests in response to the schools filing for creditor protection.

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