[CLBS] CLBS Digest, Vol 84, Issue 4
David P. Gardner
dpg at winstoncashatt.com
Thu Apr 24 14:54:52 MDT 2014
Savi,
I've written and spoken on student loan discharges several times over the last three years. Feel free to give me a call.
-----Original Message-----
From: CLBS [mailto:clbs-bounces at admws.idaho.gov] On Behalf Of clbs-request at admws.idaho.gov
Sent: Thursday, April 24, 2014 1:51 PM
To: clbs at admws.idaho.gov
Subject: CLBS Digest, Vol 84, Issue 4
Send CLBS mailing list submissions to
clbs at admws.idaho.gov
To subscribe or unsubscribe via the World Wide Web, visit
http://admws.idaho.gov/mailman/listinfo/clbs
or, via email, send a message with subject or body 'help' to
clbs-request at admws.idaho.gov
You can reach the person managing the list at
clbs-owner at admws.idaho.gov
When replying, please edit your Subject line so it is more specific than "Re: Contents of CLBS digest..."
Today's Topics:
1. Re: Student Loan Issue (Randal French)
2. Re: Student Loan Issue (Randal French)
3. Re: Student Loan Issue (Ryan F)
----------------------------------------------------------------------
Message: 1
Date: Thu, 24 Apr 2014 20:25:19 +0000
From: Randal French <RFrench at bauerandfrench.com>
To: Savi Grewal <grewal at ghslawoffice.com>, "clbs at admws.idaho.gov"
<clbs at admws.idaho.gov>
Subject: Re: [CLBS] Student Loan Issue
Message-ID:
<45AF97379DC9354BA4F5CFECBB5FFD830B39C0DF at BFSBS.BFDom.local>
Content-Type: text/plain; charset="iso-8859-1"
Are you a member of ABI? The Feb 2014 issue has an article "Student Loan Discharge Decisions Poke Holes in the Brunner Test," which cites recent decisions that address the current state of the law on discharging student loans. Krieger v. Educ. Credit Mgmt. Corp., 713 F.3d 882 (7th Cir. 2013); and Roth v. Educ. Credit Mgmt. Corp. (In re Roth), 490 B.R. 908 (B.A.P. 9th Cir. 2013). To seek a discharge for your clients, you might look at those.
To all listmates, this would be a great topic for the seminar in February 2015, which might well be held Feb 12-14, in Boise. Please, reserve your spot to write and speak on this topic early. I do not want any of you to feel like you missed a great opportunity to provide guidance to your peers.
So, you have 2 problems. First you have a claim for a debt allocated to debtor arising out of a divorce decree, that is not dischargeable in a ch 7, under 523(a)(15). That claim happens to be a student loan which is not dischargeable under 523(a)(8) unless you can satisfy the undue hardship hurdle in 523(a)(8). This should be easy. This should be your retirement case, the one that takes the rest of your career to complete.
If your clients file a ch 13, then they can discharge the obligation arising out of the divorce decree, which would not be discharged in a ch 7. During the ch 13, the lender will not be able to garnish wages, bank accounts or tax refunds. If the clients need to pay a hundred or two hundred a month, that may be less expensive than having a garnishment. If they pay a secured claim like their car loan through the ch 13, then they may be out of pocket even less. E.g. reamortize the car loan through the ch 13 so they are paying less than the contract payment, add on what is needed to satisfy the liquidation test, attorney fees and trustee fees, and that total payment may be less than the contract car payment, while still stopping any other creditor, specifically including the student loan creditor, from garnishing. When they complete the plan and get their discharge, they will have discharged their liability arising out of the divorce decree.
At that point, the Debtor will still be liable on a student loan, based upon his own liability on the loan docs. To discharge that liability, Debtor needs to file an adversary proceeding naming the student loan lender and maybe any servicing agent as defendants and prove that repayment would be an undue hardship. Look at Roth v. Educ. Credit Mgmt. Corp. (In re Roth), 490 B.R. 908 (B.A.P. 9th Cir. 2013) for the latest discussion on that burden of proof. There was some concurring opinion that discussed the evolution of the Brunner test and suggested that the test might possibly be a relic of times long gone. That you, Judge Pappas, now let's get the Ninth Circuit to agree. And I do not know whether any decision in the 9th Circuit since has addressed the Brunner test.
Ex-wife cannot make the student loan payments or will not. You could seek a state court contempt order for her to fail to pay the loan payments when they come due. That might result in her filing a bk also and perhaps seeking a determination of non-dischargeability of education loans too.
I hope this helps.
Randy
Randy French
www.bauerandfrench.com
Bauer & French
Attorneys at Law
1501 Tyrell Lane 1P.O. Box 2730 PBoise, ID 83701-2730
(208) 383-0090 ( Fax: (208) 383-0412
IMPORTANT NOTICE: This communication, including any attachments, may contain information that may be confidential or privileged and is intended solely for the entity or individual to whom it is addressed. If you are NOT the intended recipient, you must delete this message and attachments and are hereby notified that any disclosure, copying, or distribution of this message is strictly prohibited. Nothing in this email, including any attachment, is to be a legally binding signature.
-----Original Message-----
From: CLBS [mailto:clbs-bounces at admws.idaho.gov] On Behalf Of Savi Grewal
Sent: Thursday, April 24, 2014 12:38 PM
To: clbs at admws.idaho.gov
Subject: [CLBS] Student Loan Issue
Dear List mates:
I am looking for some help with a Student loan issue.
Debtor and ex-wife both had student loans. During their marriage they consolidated their student loan. As part of their divorce settlement/judgment ex-wife was assigned all of the student loan debt. She is behind in her student loan payments and the lender is asking the debtor for payments and threatening to garnish wages. Obviously, the lender cannot garnish during the pendency of the bankruptcy. Debtor and his current wife have filed bankruptcy. Is there any way to discharge this student loan debt?
Is there a solution in bankruptcy which can help the debtor to avoid any
obligation on the student loans? Will I need an adversary against the
ex-wife? Any and all suggestions are welcomed and appreciated. Thank you.
Savi Grewal
LAW OFFICES OF SAVI GREWAL
PO Box 3013
Coeur d'Alene, Idaho 83816-3013
Tel: 208-765-9404
Fax: 208-777-2624
E-mail: <mailto:grewal at ghslawoffice.com> grewal at ghslawoffice.com
NOTICE: THIS ELECTRONIC TRANSMISSION, AND/OR THE DOCUMENTS ACCOMPANYING IT, MAY CONTAIN CONFIDENTIAL INFORMATION, BELONGING TO THE SENDER, THAT IS PROTECTED BY THE ELECTRONIC COMMUNICATIONS PRIVACY ACT, 18 U.S.C. ?? 2510 AND 2521 AND MAY BE LEGALLY PRIVILEGED. THIS MESSAGE, AND ANY ASSOCIATED FILES, ARE INTENDED ONLY FOR THE USE OF THE PERSONS AND/OR ENTITIES TO WHOM IT IS ADDRESSED. THE INFORMATION TRANSMITTED IS CONFIDENTIAL AND/OR PROTECTED BY A LEGAL PRIVILEGE OR AS ATTORNEY WORK PRODUCT. ANY REVIEW, COPYING, PRINTING, DISCLOSURE, DISTRIBUTION, OR ANY OTHER USE, IS STRICTLY PROHIBITED. IF YOU ARE THE INTENDED RECIPIENT, YOU ACKNOWLEDGE THAT THE E-MAIL ADDRESS BEING UTILIZED IS SECURE AND THAT THERE WILL NOT BE A WAIVER OF THE ATTORNEY-CLIENT PRIVILEGE OR BREACH OF DUTY OF CONFIDENTIALITY BY THE SENDER'S CORRESPONDENCE TO THAT E-MAIL ADDRESS. IF THIS TRANSMISSION IS NOT INTENDED FOR YOU, OR YOU BELIEVE THAT YOU RECEIVED IT IN ERROR, PLEASE DELETE THE COPY YOU RECEIVED AND CON TACT THE SENDER FOR FURTHER INSTRUCTIONS AT 208-765-9404, THANK YOU.
_______________________________________________
CLBS mailing list
CLBS at admws.idaho.gov
http://admws.idaho.gov/mailman/listinfo/clbs
!SIG:535959f6205661997511996!
------------------------------
Message: 2
Date: Thu, 24 Apr 2014 20:39:06 +0000
From: Randal French <RFrench at bauerandfrench.com>
To: Randal French <RFrench at bauerandfrench.com>, Savi Grewal
<grewal at ghslawoffice.com>, "clbs at admws.idaho.gov"
<clbs at admws.idaho.gov>
Subject: Re: [CLBS] Student Loan Issue
Message-ID:
<45AF97379DC9354BA4F5CFECBB5FFD830B39C154 at BFSBS.BFDom.local>
Content-Type: text/plain; charset="iso-8859-1"
Is it necessary to read the fact patters before commenting on a question? Since when is that a requirement.
Although my comments have already benefited at least one person, I see that I misread the fact pattern. The loans were assigned to the ex-wife who is not Savi's client, so Savi's client does not have the 523(a)(15) issue. The ex-wife would have that issue if she filed a bk.
It is possible that subconsciously I knew that, but ignored it because writing about these things is far more enjoyable than working for a living. In any event, sorry for the confusion that I may have caused.
Randy French
www.bauerandfrench.com
Bauer & French
Attorneys at Law
1501 Tyrell Lane 1P.O. Box 2730 PBoise, ID 83701-2730
(208) 383-0090 ( Fax: (208) 383-0412
IMPORTANT NOTICE: This communication, including any attachments, may contain information that may be confidential or privileged and is intended solely for the entity or individual to whom it is addressed. If you are NOT the intended recipient, you must delete this message and attachments and are hereby notified that any disclosure, copying, or distribution of this message is strictly prohibited. Nothing in this email, including any attachment, is to be a legally binding signature.
-----Original Message-----
From: CLBS [mailto:clbs-bounces at admws.idaho.gov] On Behalf Of Randal French
Sent: Thursday, April 24, 2014 2:25 PM
To: Savi Grewal; clbs at admws.idaho.gov
Subject: Re: [CLBS] Student Loan Issue
Are you a member of ABI? The Feb 2014 issue has an article "Student Loan Discharge Decisions Poke Holes in the Brunner Test," which cites recent decisions that address the current state of the law on discharging student loans. Krieger v. Educ. Credit Mgmt. Corp., 713 F.3d 882 (7th Cir. 2013); and Roth v. Educ. Credit Mgmt. Corp. (In re Roth), 490 B.R. 908 (B.A.P. 9th Cir. 2013). To seek a discharge for your clients, you might look at those.
To all listmates, this would be a great topic for the seminar in February 2015, which might well be held Feb 12-14, in Boise. Please, reserve your spot to write and speak on this topic early. I do not want any of you to feel like you missed a great opportunity to provide guidance to your peers.
So, you have 2 problems. First you have a claim for a debt allocated to debtor arising out of a divorce decree, that is not dischargeable in a ch 7, under 523(a)(15). That claim happens to be a student loan which is not dischargeable under 523(a)(8) unless you can satisfy the undue hardship hurdle in 523(a)(8). This should be easy. This should be your retirement case, the one that takes the rest of your career to complete.
If your clients file a ch 13, then they can discharge the obligation arising out of the divorce decree, which would not be discharged in a ch 7. During the ch 13, the lender will not be able to garnish wages, bank accounts or tax refunds. If the clients need to pay a hundred or two hundred a month, that may be less expensive than having a garnishment. If they pay a secured claim like their car loan through the ch 13, then they may be out of pocket even less. E.g. reamortize the car loan through the ch 13 so they are paying less than the contract payment, add on what is needed to satisfy the liquidation test, attorney fees and trustee fees, and that total payment may be less than the contract car payment, while still stopping any other creditor, specifically including the student loan creditor, from garnishing. When they complete the plan and get their discharge, they will have discharged their liability arising out of the divorce decree.
At that point, the Debtor will still be liable on a student loan, based upon his own liability on the loan docs. To discharge that liability, Debtor needs to file an adversary proceeding naming the student loan lender and maybe any servicing agent as defendants and prove that repayment would be an undue hardship. Look at Roth v. Educ. Credit Mgmt. Corp. (In re Roth), 490 B.R. 908 (B.A.P. 9th Cir. 2013) for the latest discussion on that burden of proof. There was some concurring opinion that discussed the evolution of the Brunner test and suggested that the test might possibly be a relic of times long gone. That you, Judge Pappas, now let's get the Ninth Circuit to agree. And I do not know whether any decision in the 9th Circuit since has addressed the Brunner test.
Ex-wife cannot make the student loan payments or will not. You could seek a state court contempt order for her to fail to pay the loan payments when they come due. That might result in her filing a bk also and perhaps seeking a determination of non-dischargeability of education loans too.
I hope this helps.
Randy
Randy French
www.bauerandfrench.com
Bauer & French
Attorneys at Law
1501 Tyrell Lane 1P.O. Box 2730 PBoise, ID 83701-2730
(208) 383-0090 ( Fax: (208) 383-0412
IMPORTANT NOTICE: This communication, including any attachments, may contain information that may be confidential or privileged and is intended solely for the entity or individual to whom it is addressed. If you are NOT the intended recipient, you must delete this message and attachments and are hereby notified that any disclosure, copying, or distribution of this message is strictly prohibited. Nothing in this email, including any attachment, is to be a legally binding signature.
-----Original Message-----
From: CLBS [mailto:clbs-bounces at admws.idaho.gov] On Behalf Of Savi Grewal
Sent: Thursday, April 24, 2014 12:38 PM
To: clbs at admws.idaho.gov
Subject: [CLBS] Student Loan Issue
Dear List mates:
I am looking for some help with a Student loan issue.
Debtor and ex-wife both had student loans. During their marriage they consolidated their student loan. As part of their divorce settlement/judgment ex-wife was assigned all of the student loan debt. She is behind in her student loan payments and the lender is asking the debtor for payments and threatening to garnish wages. Obviously, the lender cannot garnish during the pendency of the bankruptcy. Debtor and his current wife have filed bankruptcy. Is there any way to discharge this student loan debt?
Is there a solution in bankruptcy which can help the debtor to avoid any
obligation on the student loans? Will I need an adversary against the
ex-wife? Any and all suggestions are welcomed and appreciated. Thank you.
Savi Grewal
LAW OFFICES OF SAVI GREWAL
PO Box 3013
Coeur d'Alene, Idaho 83816-3013
Tel: 208-765-9404
Fax: 208-777-2624
E-mail: <mailto:grewal at ghslawoffice.com> grewal at ghslawoffice.com
NOTICE: THIS ELECTRONIC TRANSMISSION, AND/OR THE DOCUMENTS ACCOMPANYING IT, MAY CONTAIN CONFIDENTIAL INFORMATION, BELONGING TO THE SENDER, THAT IS PROTECTED BY THE ELECTRONIC COMMUNICATIONS PRIVACY ACT, 18 U.S.C. ?? 2510 AND 2521 AND MAY BE LEGALLY PRIVILEGED. THIS MESSAGE, AND ANY ASSOCIATED FILES, ARE INTENDED ONLY FOR THE USE OF THE PERSONS AND/OR ENTITIES TO WHOM IT IS ADDRESSED. THE INFORMATION TRANSMITTED IS CONFIDENTIAL AND/OR PROTECTED BY A LEGAL PRIVILEGE OR AS ATTORNEY WORK PRODUCT. ANY REVIEW, COPYING, PRINTING, DISCLOSURE, DISTRIBUTION, OR ANY OTHER USE, IS STRICTLY PROHIBITED. IF YOU ARE THE INTENDED RECIPIENT, YOU ACKNOWLEDGE THAT THE E-MAIL ADDRESS BEING UTILIZED IS SECURE AND THAT THERE WILL NOT BE A WAIVER OF THE ATTORNEY-CLIENT PRIVILEGE OR BREACH OF DUTY OF CONFIDENTIALITY BY THE SENDER'S CORRESPONDENCE TO THAT E-MAIL ADDRESS. IF THIS TRANSMISSION IS NOT INTENDED FOR YOU, OR YOU BELIEVE THAT YOU RECEIVED IT IN ERROR, PLEASE DELETE THE COPY YOU RECEIVED
AND CONTACT THE SENDER FOR FURTHER INSTRUCTIONS AT 208-765-9404, THANK YOU.
_______________________________________________
CLBS mailing list
CLBS at admws.idaho.gov
http://admws.idaho.gov/mailman/listinfo/clbs
_______________________________________________
CLBS mailing list
CLBS at admws.idaho.gov
http://admws.idaho.gov/mailman/listinfo/clbs
!SIG:5359733c128045076216032!
------------------------------
Message: 3
Date: Thu, 24 Apr 2014 14:50:36 -0600
From: Ryan F <refasu at gmail.com>
To: Savi Grewal <grewal at ghslawoffice.com>
Cc: Bankruptcy list <clbs at admws.idaho.gov>
Subject: Re: [CLBS] Student Loan Issue
Message-ID:
<CA+CqOwLkKUOR0UY7Zekp9H0K9jdFjDu_qKTLqb5dRec093N2UQ at mail.gmail.com>
Content-Type: text/plain; charset="utf-8"
It seems that Judge Pappas' concurrence in Roth may have been written for the consideration of the Ninth Circuit, who would have been writing their opinion in Hedlund when Roth was published. Hedlund slightly expanded the Brunner test. Both Roth and Hedlund decisions are attached to this email.
Kindest regards,
Ryan Farnsworth
Avery Law
Idaho Falls, ID
On Thu, Apr 24, 2014 at 12:37 PM, Savi Grewal <grewal at ghslawoffice.com>wrote:
> Dear List mates:
>
>
>
> I am looking for some help with a Student loan issue.
>
>
>
> Debtor and ex-wife both had student loans. During their marriage
> they consolidated their student loan. As part of their divorce
> settlement/judgment ex-wife was assigned all of the student loan debt.
> She is behind in her student loan payments and the lender is asking
> the debtor for payments and threatening to garnish wages. Obviously,
> the lender cannot garnish during the pendency of the bankruptcy.
> Debtor and his current wife have filed bankruptcy. Is there any way to
> discharge this student loan debt?
> Is there a solution in bankruptcy which can help the debtor to avoid any
> obligation on the student loans? Will I need an adversary against the
> ex-wife? Any and all suggestions are welcomed and appreciated. Thank you.
>
>
>
> Savi Grewal
>
> LAW OFFICES OF SAVI GREWAL
>
> PO Box 3013
>
> Coeur d?Alene, Idaho 83816-3013
>
> Tel: 208-765-9404
>
> Fax: 208-777-2624
>
> E-mail: <mailto:grewal at ghslawoffice.com> grewal at ghslawoffice.com
>
> NOTICE: THIS ELECTRONIC TRANSMISSION, AND/OR THE DOCUMENTS
> ACCOMPANYING IT, MAY CONTAIN CONFIDENTIAL INFORMATION, BELONGING TO
> THE SENDER, THAT IS PROTECTED BY THE ELECTRONIC COMMUNICATIONS PRIVACY
> ACT, 18 U.S.C. ?? 2510 AND 2521 AND MAY BE LEGALLY PRIVILEGED. THIS
> MESSAGE, AND ANY ASSOCIATED FILES, ARE INTENDED ONLY FOR THE USE OF
> THE PERSONS AND/OR ENTITIES TO WHOM IT IS ADDRESSED. THE INFORMATION
> TRANSMITTED IS CONFIDENTIAL AND/OR PROTECTED BY A LEGAL PRIVILEGE OR
> AS ATTORNEY WORK PRODUCT. ANY REVIEW, COPYING, PRINTING, DISCLOSURE,
> DISTRIBUTION, OR ANY OTHER USE, IS STRICTLY PROHIBITED. IF YOU ARE THE
> INTENDED RECIPIENT, YOU ACKNOWLEDGE THAT THE E-MAIL ADDRESS BEING
> UTILIZED IS SECURE AND THAT THERE WILL NOT BE A WAIVER OF THE
> ATTORNEY-CLIENT PRIVILEGE OR BREACH OF DUTY OF CONFIDENTIALITY BY THE
> SENDER?S CORRESPONDENCE TO THAT E-MAIL ADDRESS. IF THIS TRANSMISSION
> IS NOT INTENDED FOR YOU, OR YOU BELIEVE THAT YOU RECEIVED IT IN ERROR,
> PLEASE DELETE THE COPY YOU RECEIVED AND CONTACT THE SENDER FOR FURTHER
> INSTRUCTIONS AT 208-765-9404, THANK YOU.
>
>
>
>
>
> _______________________________________________
> CLBS mailing list
> CLBS at admws.idaho.gov
> http://admws.idaho.gov/mailman/listinfo/clbs
>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: 1 - BAP RothV ECMC opinion-FINAL AZ-11-1233.pdf
Type: application/pdf
Size: 64186 bytes
Desc: not available
URL: <http://admws.idaho.gov/pipermail/clbs/attachments/20140424/4095e400/attachment.pdf>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: 2 - 9CCA - Hedlund.pdf
Type: application/pdf
Size: 110377 bytes
Desc: not available
URL: <http://admws.idaho.gov/pipermail/clbs/attachments/20140424/4095e400/attachment-0001.pdf>
------------------------------
Subject: Digest Footer
_______________________________________________
CLBS mailing list
CLBS at admws.idaho.gov
http://admws.idaho.gov/mailman/listinfo/clbs
------------------------------
End of CLBS Digest, Vol 84, Issue 4
***********************************
More information about the CLBS
mailing list