MAKING SENSE OF THE MOU AS A LEGALLY ENFORCEABLE CONTRACT
As a starting point, it is worth noting the obvious disclaimer: while journalists have reported that Schiano and Tennessee signed an MOU, there has been no official statement by either Schiano or Tennessee to that effect. If no such agreement had been signed, Schiano’s potential claims would be far weaker.
Here’s another disclaimer: even if an MOU has been signed, it is not yet a public document.
With those disclaimers out of the way, the language of an MOU signed by Schiano and Tennessee would be crucial in understanding each side’s rights. Other MOUs signed by Tennessee may provide clues. One such MOU is available online. In 2015, Tennessee signed an MOU with Rick Barnes to become the school’s men’s head basketball coach. Barnes would later sign a six-year, $15 million contract. There are several key terms in the Barnes’ MOU:
1) The MOU is described as a “binding and legally enforceable agreement” once fully executed (signed).
Significance: Note first that the MOU must be signed by all relevant parties in order to become binding. In the case of Barnes’s MOU, four persons had to sign it: Barnes; vice chancellor and athletic director Dave Hart; chancellor Jimmy Cheek; and treasurer and CFO Butch Peccolo. If Schiano’s MOU contained similar requirements, it would not be enforceable unless signed by all of the listed persons.
Second, Barnes’s MOU is portrayed as an interim and incomplete contract—but nonetheless a binding contract. It is “interim” in that it would be replaced by an employment contract and is “incomplete” in that it only highlights key terms as opposed to detailing every term (as would the eventual employment contract).
This particular language in Barnes's MOU reflects why universities use MOUs. An MOU in part reflects that the coach and the university’s timing are on very different schedules. A coach wants to start immediately given the implications for recruiting and assembling a staff. Waiting for the paperwork to clear could put the coach and the program at a disadvantage.