WASHINGTON — The Supreme Court will decide whether student loans can be dismissed through bankruptcy with just a notice to the collector instead of a hearing proving that paying the money back would cause an “undue hardship.”
Francisco Espinosa gave United Student Aid Funds Inc. a Chapter 13 bankruptcy plan saying he would pay back $13,250 on his four student loans. The recipient, USA Funds, said he owed $17,832, but it did not object to his bankruptcy plan, which was finalized in 1994.
But in 2000, Espinosa’s income tax refund was taken to pay on the rest of the debt.
USA Funds says the bankruptcy agreement is void because Espinosa never proved in court that paying the full amount would cause him undue hardship.
Espinosa says the bankruptcy agreement is final and the company cannot go back on it now. The 9th U.S. Circuit Court of Appeals in San Francisco agreed, saying the time to object was before the bankruptcy was completed.
The case is United Student Aid Funds v. Espinosa, 08-1134.
In other action today, the court:
— Refused to get involved in local Texas governments’ fight against hundreds of miles of fencing along the U.S.-Mexico border. The court rejected a challenge by El Paso and other counties to a lower court ruling dismissing a lawsuit against Homeland Security Secretary Janet Napolitano. The governments argue that Napolitano’s predecessor, Michael Chertoff, improperly waived 37 federal laws that could have slowed or blocked construction of fencing along the border that is intended to deter illegal immigrants.
— Refused to hear an appeal from local governments saying the Federal Communications Commission had overstepped its authority in setting rules making it easier for new cable TV competitors to gain local franchises.
— Stepped into a property-rights dispute over plans to rebuild eroded beaches on Florida’s Gulf coast. The court agreed to decide whether the Constitution imposes limits on governments’ authority to combat beach erosion when beachfront private property would be affected.
— Struck down as unconstitutional a tax that Valdez, Alaska imposed on oil tankers using its port.
— Said immigration officials do not have to have a jury determine the finanical impact of an immigrant’s crime in their deportation decisions. In a unanimous decision, the court turned away Manoj Nijhawan’s appeal.
— Said they will hear arguments next year in a case involving eight Shell Oil station operators in Massachusetts who are fighting changes in lease terms that they say were intended to convert stations run by franchisees to company-owned facilities.
— Refused to review the convictions of five Cuban intelligence agents who say they did not receive a fair trial because of strong anti-Castro sentiment in Miami.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
