Three areas of court litigation pose challenges to the administration of higher education. First, developments in equal protection and related areas promise reassessment of the distribution of educational finances. Both federal and state court cases suggest a shift from a requirement of equal educational opportunity to equal educational effects. Second, due process of law, having been extended to protect students and faculty in public institutions, now poses important challenges concerning even the very substance of education. Stricter tests of the rationality of administrative acts are being devised. A recent district court case challenged administrative discretion by acknowledging the right of parents to argue for a different educational program for their child than that recommended by the school. Finally, new standards of good faith may result in requirements for shared decision-making in some areas. Recent cases concerning an institutional establishment of financial exigency have suggested that joint faculty-administrative consultation on the matter may be necessary to demonstrate administrative good faith. (Author/JM)