This articles examines litigation which has been generated as a result of fiscal cut-backs at institutions of higher education and looks at the rights and obligations of college and university administrators and students as well as possible future trends. A first section details the effects of budget reductions at California state institutions where the recession has prompted deep cuts in state allocations for education. A following section describes the situation at Syracuse University (New York) and its plans to cut spending over the coming years by freezing salaries and eliminating major academic programs. The paper goes on to describe the types of legal questions that such actions are raising particularly whether students and or universities may assert standard contract theories such as impossibility of performance, express and implied contract, foreseeability, and damage. Specific cases are reviewed including "Beukas versus Fairleigh Dickinson University,""Napolitano versus Princeton University Board of Trustees," AASE versus State of South Dakota Board of Regents,""Eden versus the Board of Trustees of the State University of New York," and "Peretti versus the State of Montana". A conclusion looks at the possible future impact of decreased support for higher education. Included are 43 references. (JB)