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United Student Aid Funds Inc. v. Espinosa

Docket No.: 08-1134
Certiorari Granted: Jun 15 2009
Argued: December 1, 2009
Decided: March 23, 2010

PartyNames: United Student Aid Funds, Inc. v. Francisco J. Espinosa
Petitioner: United Student Aid Funds Inc.
Respondent: Francisco J. Espinosa

Court Below: United States Court of Appeals for the Ninth Circuit

United Student Aid Funds Inc.
Francisco J. Espinosa
Question Presented:

1. Student loans are statutorily non-dischargeable in bankruptcy unless repayment would cause the debtor an "undue hardship." Debtor failed to prove undue hardship in an adversary proceeding as required by the Bankruptcy Rules, and instead, merely declared a discharge in his Chapter 13 plan. Are the orders confirming the plan and discharging debtor void? 2. Bankruptcy Rules permit discharge of a student loan only through an adversary proceeding, commenced by filing a complaint and serving it and a summons on an appropriate agent of the creditor. Instead, debtor merely included a declaration of discharge in his Chapter 13 plan and mailed it to creditor's post office box. Does such procedure meet the rigorous demands of due process and entitle the resulting orders to respect under principles of res judicata?


1) Does the procedure by which a debtor merely includes the discharge of his student loans in his Chapter 13 plan, which is then mailed to the creditor, sufficient to meet the requirements of due process? 2) Are Chapter 13 plans that discharge student loans void if the debtor fails to prove "undue hardship" in an adversary proceeding?

Holding: affirmed
Vote: 9-0
Opinion By: Justice Clarence Thomas

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