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Simmons v. U.S. Dep't of Education

August 31, 2006


The opinion of the court was delivered by: Jeanne E. Scott, U.S. District Judge


This matter is before the Court on pro se Appellant Nathan Simmons' appeal of a Bankruptcy Court's Decision denying Simmons' request to discharge his student loans based on undue hardship under 11 U.S.C. § 523(a)(8)(B). For the reasons set forth below, the Bankruptcy Court's Decision is affirmed.


The following are factual findings of the Bankruptcy Court which are not at issue in this appeal. From 1990 through 1999, Appellant Simmons attended various educational institutions of higher learning, but eventually received his bachelor's degree from the University of Illinois at Springfield. During that period, Simmons financed his education through student loans. At the time of Simmons' bankruptcy trial, Simmons' principal balance of student loans was approximately $53,000.00. Simmons works for the Illinois Department of Human Services as a case worker. Simmons' annual salary is approximately $41,000.00. His two-week pay check is $1,729.00 in gross pay, with $556.41 in deductions for taxes, insurance, etc., and $436.10 in child support payments. Simmons' monthly net expenses of $1,788.00 exceed his monthly net income of $1,582.93.

Simmons has fathered 10 children, ranging in age from 14 to 2 years.*fn1 Simmons has custody of two of his 10 children, and it appears that Simmons provides the sole support for these two children. Simmons also provides financial support for six of the other children that are not in his custody. Every two weeks, Simmons pays court-ordered child support in the amount of $436.10 for the support of four of the children not in his custody. Additionally, every month, Simmons voluntarily gives $274.00 to the mother of two of the other children for day care expenses. For the remaining two children, Simmons currently pays no child support, but he believes that in the near future he will be obligated to pay support for them.

During the period from December 2003 through August 2004, Simmons voluntarily made six payments on his student loans, all of which totaled $449.00. As a result of the interception of an income tax refund, Simmons made an additional payment of $9,000.00 on his student loans. Sometime in early 2005, the U.S. Department of Education served Simmons with a garnishment notice. In response, Simmons filed an appeal based on his financial status. The garnishment was cancelled; however it might be reinstated if Simmons fails to make appropriate payment arrangements in the future.

Simmons and two other witnesses testified at trial. Simmons' co-worker Francis Smith testified that she has known Simmons for about five years and that, over a couple of years, she noticed that Simmons had become depressed and was anxious about his financial situation. Mike Kuzola also testified; Kuzola testified that he initially came to know Simmons because his son and Simmons attended the same high school and wrestled on the same team. Kuzola testified that he works for Heritage Behavior Health Services and has a bachelor's and master's degree in counseling. Kuzola testified that he became reacquainted with Simmons when his employer assigned him to work at the Illinois Department of Human Services. Kuzola testified that for the last several years, Simmons met with Kuzola two or three times a week for counseling and to discuss Simmons' problems. Kuzola testified that based upon his observation, he believed that Simmons was stressed and depressed about his financial situation.

On December 13, 2005, the Bankruptcy Court issued an Opinion finding that Simmons had failed to establish the requirements of undue hardship, and thus it denied Simmons' request to discharge his student loan obligation. On January 1, 2006, Simmons filed a timely Notice of Appeal with this Court.


This Court has jurisdiction to review decisions of the Bankruptcy Court pursuant to 28 U.S.C. § 158. The standard of review applied in reviewing factual findings of the Bankruptcy Court is the clearly erroneous standard. Educational Credit Management Corp. v. Durrani, 320 B.R. 357, 359 (N.D. Ill. 2005) (citing Matter of A-1 Paving and Contracting, Inc., 116 F.3d 242, 243 (7th Cir. 1997)); In re Tirch, 409 F.3d 677, 680 (6th Cir. 2005). The standard of review used in reviewing legal conclusions of the Bankruptcy Court is the de novo standard. Id. In the present case, Appellant Simmons only challenges the legal conclusions of the Bankruptcy Court; therefore, the Court applies the de novo standard of review.


To prevail on his claim that his student loans should be discharged on the grounds of undue hardship, Simmons must show that he has satisfied the following elements of the undue hardship test developed in Brunner v. New York State Higher Educ. Serv. Corp: "(1) that he cannot maintain, based on current income and expenses, a minimal standard of living for himself and his dependents if forced to repay the loans; (2) that additional circumstances exist indicating that the state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and (3) that the debtor has made good faith efforts to repay the loans." Goulet v. Educational Credit Management Corp., 284 F.3d 773, 777 (7th Cir. 2002) (citing Matter of Roberson, 999 F.2d 1132, 1135 (7th Cir. 1993)); Brunner, 831 F.2d 395, 396 (2nd Cir. 1987).

Simmons argues that the Bankruptcy Court erred in finding that he did not meet the second prong of the "undue hardship" test. In support of his appeal, Simmons has filed a one-page brief in which he simply lists several cases without providing any elaboration on how those cases are applicable to his case. After reviewing these cases, as well as the record of the proceedings in the Bankruptcy Court, the Court finds that the Bankruptcy Court did not commit error in concluding that Simmons failed to meet the second prong of the "undue hardship" test.

The Bankruptcy Court found that Simmons met the first and the third prongs of the Brunner test. Simmons filed the instant appeal with respect to the second prong. As such, the only issue on appeal is whether Simmons has met the second prong of the Brunner analysis. To satisfy that prong Simmons must show that dire circumstances exist, and are likely to persist, such that repayment of his loans would cause undue hardship. "[E]vidence 'of additional, exceptional circumstances [(such as psychiatric problems, lack of job skills, and lack of education)], strongly suggestive of continuing inability to repay over an extended period of time . . .'" is required to prove the second prong. Goulet, 284 F.3d at 778 (citing Matter of Roberson, 999 F.2d at 1136). In other words, Simmons must demonstrate a "certainty of hopelessness, not simply a present inability to fulfill financial commitment." Matter of Roberson, 999 F.2d at 1136 (quoting In re Briscoe, 16 B.R. 128, 131 (Bankr. S.D.N.Y. 1981) (internal citations omitted). Courts have found that old age and severe medical conditions qualify as additional circumstances. Durrani, 320 B.R. at 361; In re Oyler, 397 F.3d 382, 386 (6th Cir. 2005). "The ...

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