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George Czaplinski v. Bank of America

Summarizing by Lars Fuller

Thomas v. Department of Education (In re Thomas)

Fifth Circuit now says that student loans must ‘impose intolerable difficulties’ to be dischargeable.

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Case Type:
Case Status:
18-11091 (5th Circuit, Jul 30,2019) Not Published
Reaffirming its commitment to the Brunner test to determine the dischargeability of student loans, the Fifth Circuit affirmed the lower courts’ refusal to discharge a chapter 7 debtor’s student loan tests.
Procedural context:
Chapter 7 debtor filed an adversary proceeding seeking discharge of approximately $7,000 in student loans obtained to finance two semesters of community college. Applying the Brunner test, the bankruptcy court concluded that she had failed to show that her present inability to repay the student loans “is likely to persist for a significant portion of the repayment period” and denied her request for discharge. Despite expressing sympathy for the debtor’s circumstances, the district court affirmed. On appeal, the Fifth Circuit panel began by stating that it remains bound by its previous adoption of the Brunner test in In re Gerhardt, 348 F.3d 89 (5th Cir. 2003). Responding to the debtor’s arguments that the Brunner test was inconsistent with the plain meaning of “undue hardship” in 11 U.S.C. § 523(a)(8), the panel went on to reaffirm its belief that the high burden imposed by Brunner and its progeny was nevertheless consistent with Congress’s steady tightening of the discharge provision over the years.
The chapter 7 debtor suffers from diabetic neuropathy, which causes pain in the lower extremities that causes muscle weakness and pain after prolonged periods of standing. In 2016, she was terminated for cause from her employment at a call center. After that, she held a series of jobs that required her to stand for extended periods, compelling her to quit each of them. In denying the debtor’s request for discharge, the bankruptcy court observed that the debtor conceded that she ws unable to show that she was “completely incapable of employment now or in the future.”
Jones, Ho, and Oldham

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