It has been said that the law could be considered a living thing as it is always evolving and changing. Here are a few recent bankruptcy cases of interest. If you have additional questions please visit our Seattle Bankruptcy Lawyer homepage to speak to a Washington state bankruptcy lawyer.
Straub v Sallie Mae 2010 WL 3297057 (Bankr.D.S.C.)
A Chapter 7 debtor who was eligible for the income contingent repayment program (ICRP), and who admitted that she could afford to make the required payments, failed to satisfy the first, or “minimal standard of living,” prong of the Brunner test for discharge of her student loan debt on an “undue hardship” theory. The debtor who was healthy and gainfully employed, and who did not allege that she suffered from any disability, also failed to satisfy her burden of proof under the second, or “additional circumstances,” prong of the Brunner test. Finally, the debtor’s failure to take advantage of the ICRP prevented her from demonstrating the requisite “good faith,” of a kind required to discharge her roughly $56,000 in student loan debt on an “undue hardship” theory.
Glaubitz 2010 WL 3290462 (Bankr.E.D.Wis.)
Guarantees which Chapter 13 debtors had executed of corporate debt, each of which relieved the creditor of the need to exhaust its remedies against the corporation before pursuing the debtors and either indicated that the debtors’ obligation was in the nature of a guarantee of payment or specified that the debtors’ obligation was absolute and unconditional, were in the nature of unconditional and “noncontingent” liabilities, that had to be added to the debtors’ other noncontingent, liquidated unsecured debt to determine whether they were eligible for Chapter 13 relief. It did not matter that, as of commencement of the Chapter 13 case, the corporation was current on its obligations to the creditor, or that the corporate debt was fully secured by the assets of the corporation.