Posted: October 22, 2009.
NACBA has filed an amicus brief in
United Student Aid Funds vs. Espinosa, where the Supreme Court will consider whether a student loan creditor can attack a debtor's chapter 13 plan 10 years after it was confirmed and five years after the debtor completed his payments. The case was brought by the creditor who filed a "Rule 60 motion" arguing that the plan's term permitting discharge of interest on his student loan was "void" because the discharge was not sought by an adversary proceeding. NACBA's brief argues that allowing such a challenge would eviscerate the finality that all parties in every chapter of the Code rely upon when a plan is confirmed, and that Rule 9024 (incorporating Rule 60 for most purposes) does not permit a creditor to seek plan revocation except as permitted in Code section 1330. It also addresses the argument made by the creditor and numerous student loan creditor amici that they are too inundated by mail to be bothered by reading every notice they get from bankruptcy courts. NACBA's brief points out that they are being paid by the taxpayers to do exactly that, and in fact the governing regulations require them to review chapter 13 plans and object when appropriate. The brief was written by Geoff Walsh of the National Consumer Law Center.