I don't see it that way (purely MHO, of course.) In this case, I see it as a contract. The student agrees to pay the fee and obey the school's rules in exchange for the education. If the student willingly broke the rules, he has no right to recoup any fees. If there is some sort of formal school policy that allows for refunds in cases of expulsion, then he may have recourse. Otherwise, he's $#!+ outta luck.
MU says he violated the contract, the student says he didn't.
Courts judge contract disputes all the time.