Conway v. National Collegiate Trust, et al. (In re Conway)

No. 15-6029 (8th Cir. B.A.P. Dec. 21, 2015).
Bankruptcy court did not abuse its discretion in concluding that some, but not all, of a debtor’s student loans were nondischargeable. Affirmed.
Procedural context:
Debtor sought a determination that her student loan debt was nondischargeable under § 523(a)(8). The bankruptcy court declared her debts nondischargeable, and the debtor appealed. The Bankruptcy Appellate Panel reversed and remanded with instructions to determine whether the debtor’s “present disposable income, if any, over the course of an entire year” was sufficient to service any student loan payments. The bankruptcy court concluded that the debtor could make payments on four loans, and discharged the remaining eleven loans. The debtor appealed.
On remand, the bankruptcy court instructed the debtor to provide current information on her monthly income and expenses, and ultimately based its decision on the debtor’s income and expenses from November 2013 to October 2014. On appeal, the debtor argued that the bankruptcy court imposed an arbitrary time frame that artificially inflated her income and failed to account for an anticipated increase in health care costs. Noting that the income and expenses of the debtor (a waitress) fluctuated from month to month, the B.A.P. concluded that the bankruptcy court had correctly followed the B.A.P.’s instructions to review a full year’s data on income and expense data to “smooth” out any such fluctuations. In affirming the bankruptcy court’s ruling, The B.A.P. emphasized that “a debtor’s income and expenses are seldom static,” and “courts are not equipped to revisit a nondischargeability determination every time a debtor’s circumstances change.” Finding that the bankruptcy court had in fact used the most recent time period for which complete data was available, the B.A.P. affirmed.
Kressel, Saladino, and Shodeen.

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