Halperin v. Regional Adustment Bureau

• Decision Date: 15 March 2000
• Docket Number: No. 98-5917,98-5917
• Citation: 206 F.3d 1063
• Parties: (11th Cir. 2000) Ronny J. HALPERIN, Plaintiff-Counter-Defendant-Appellee, v. REGIONAL ADJUSTMENT BUREAU, INC., United Student Aid Funds, Inc., Defendants-Appellants, United States Department of Education, Defendant-Counter-Claimant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1063

206 F.3d 1063 (11th Cir. 2000)

Ronny J. HALPERIN, Plaintiff-Counter-Defendant-Appellee, v.REGIONAL ADJUSTMENT BUREAU, INC., United Student Aid Funds, Inc., Defendants-Appellants,United States Department of Education, Defendant-Counter-Claimant-Appellant.

No. 98-5917.

United States Court of Appeals Eleventh Circuit.

March 15, 2000.

Appeals from the United States District Court for the Southern District of Florida.

Before BIRCH and MARCUS, Circuit Judges, and ALAIMO^*, Senior District Judge.

BIRCH, Circuit Judge:

The United States Department of Education("Education"), United Student Aid Funds, Inc.("USAF") and Regional Adjustment Bureau, Inc.("RAB")(collectively, the "Creditors") appeal the district court's order rejecting the report and recommendation of the magistrate judge, denying their motions for summary judgment, and granting Ronny J. Halperin's ("Halperin's")motion for summary judgment.The district court issued a declaratory order concluding that under section 488A of the Higher Education Act, codified at 20 U.S.C. 1095a(" 1095a"), multiple holders of defaulted student loans are subject to a cumulative garnishment limit of ten percent of the debtor's disposable pay and imposing an injunction against the Creditors, requiring that they discontinue garnishing an aggregate amount totaling more than ten percent of Halperin's disposable pay.The Creditors argue that the ten percent limit under 1095a applies to the single garnishment by an individual note holder and the cumulative garnishment limit of twenty-five percent per debtor established by the Consumer Credit Protection Act (CCPA), 15 U.S.C. 1673, provides the maximum aggregate remedy available to multiple note holders seeking multiple garnishments.Thus, they contend that each holder of a defaulted student loan should be allowed to garnish up to ten percent of the debtor's disposable pay under 1095a(a), so long as the total garnishment by all note holders does not exceed the CCPA's twenty-five percent limit.Additionally, Education argues that, under 20 U.S.C. 1082(a)(2), the district court did not have jurisdiction to enter injunctive relief against Education.¹We REVERSE the district court's order, VACATE the injunction against the Creditors, and REMAND for entry of judgment in favor of the Creditors.

I.BACKGROUND

The facts in this case are undisputed.We provide only a brief review of the factual and procedural history.

Halperin is an attorney who financed his legal education with seven loans obtained under the Federal Family Education Loan Program ("FFELP").He also cosigned a loan to finance his son's education.Despite earning $145,000 annually, he has defaulted on each of these loans, four of which are currently held by Education and four by USAF.As of October 20, 1997, the unpaid loans totaled $56,250.52.²RAB is the collection agent for USAF.

During 1996, Education issued an Administrative Garnishment Order to Halperin's employer to withhold $200 from Halperin's bi-weekly paycheck.Later that year, RAB, acting on behalf of USAF, issued an Administrative Garnishment Order for Halperin's employer to withhold an additional ten percent from the Halperin's bi-weekly paycheck.As a result of both Garnishment Orders, 16.83% of Halperin's bi-weekly pay or 14.83% of Halperin's total disposable pay for 1996 was withheld.³

Halperin sued the Creditors, claiming that their garnishments exceeded the amount permitted by 1095a.The Creditors countered by arguing that the 10% limit found in 1095a applies only to individual note holders and that 15 U.S.C. 1673 sets the limit for multiple wage garnishments at 25%.The parties stipulated to the facts and moved for summary judgment as to the construction of 1095a.The magistrate judge recommended that Halperin's motion be denied.However, the district court rejected this recommendation and held that 1095a restricted the garnishment of wages for defaulted student loans to 10% of the debtor's disposable wages and, accordingly, enjoined the Creditors from garnishing, on a combined basis, more than 10% of the Halperin's disposable wages.The Creditors appeal this order.⁴

II.DISCUSSION

In 1991, Congress amended the Higher Education Act to authorize the Secretary of Education (the "Secretary") or guaranty agencies to collect a defaulted student loan by administrative garnishment of up to 10% of the defaulter's disposable pay.SeeHigher Education Technical Amendments of 1991, Pub.L. 102-26;137 Cong. Rec. S7291-02, S7369;20 U.S.C. 1095a.⁵The purpose of this amendment was threefold: (1) it "provide[d] uniform authority under which the Secretary and guaranty agencies could garnish the pay of student loan defaulters,"137 Cong. Rec. S7291-02, S7369, (2)"it eliminate[d] the unnecessary and unduly costly incentive in current law ... that permit[ed] guaranty agencies to retain an additional five percent of collections,"id., and (3) it increased the efficiency of collecting defaulted student loans because "it is not cost-effective for the Department of Justice(DOJ) to pursue defaulted loans in small dollar amounts through the judicial process,"id.Moreover, the additional monies collected on defaulted student loans as a result of the administrative garnishments were allocated by Congress to provide funding for the extension of unemployment benefits.See137 Cong. Rec. S16826-02, S16832-33 (Senator Kassebaum discussing legislation extending unemployment benefits and noting "that another way we are funding the extension is to make a number of changes in the Federal Student Aid Program.").At issue in this case is the question of whether, through 1095a, Congress intended to limit the amount garnished from a defaulting debtor's disposable pay to 10% for each individual note holder or cumulatively for all holders of a debtor's defaulted student loans.This is a question of statutory interpretation which we review de novo.SeeUnited States v. Veal, 153 F.3d 1233, 1245(11th Cir.1998), cert. denied, 526 U.S. 1147, 119 S.Ct. 2024, 143 L.Ed.2d 1035(1999).

A.Plain Language of the Statute

"The starting point for all statutory interpretation is the language of the statute itself."United States v. DBB, Inc., 180 F.3d 1277, 1281(11th Cir.1999)(interpreting18 U.S.C. 1345(a)(2) and finding the plain language of the statute ambiguous).The district court emphasized that Congress used the plural word "loans" to describe the instruments the Secretary was authorized to collect by garnishing the debtor's disposable pay and found that "the use of the plural in the opening sentence implies that the ten percent limit applies to all loans."SeeR3-128at 4-5(quoting20 U.S.C. 1095a: " 'a guaranty agency, or the Secretary in the case of loans made, insured or guaranteed under this subchapter that are held by the Secretary, may garnish the disposable pay of an individual to collect the amount owed by the individual;' " emphasis in district courtorder).In contrast, the Creditors argue that the plain language of the statute supports the conclusion that Congress intended only to limit the garnishment authority of individual note holders to 10% of the debtor's disposable pay under 1095a.The Creditors point to use of singular nouns to refer to the note holder, guaranty agency, and defaulted loans, as well as the use of the connector "or" to group the Secretary and the guaranty agency within the opening paragraph of 1095a(a), as evidence of Congressional intent that the 10% limit on garnishments be applied to each individual note holder, not the creditors collectively.See20 U.S.C. 1095a("a guaranty agency, or the Secretary in the case of loans made, insured or guaranteed under this subchapter ... that are held by the Secretary, may garnish the disposable pay of an individual ... or, in the case of a loan guaranteed under part B of this subchapter on which the guaranty agency received reimbursement from the Secretary ..., with the guaranty agency holding the loan; "emphasis added).The Creditors also assert that the use of singular words to describe the note holder seeking garnishment and the defaulted debt in subsections 1095a(a)(2)-(8) further supports the conclusion that the 10% limitation in subsection (1) applies only to individual note holders.

While we must be cautious that these "linguistic arguments" do not "make too much of too little,"National Federation of Federal Employees, Local 1309 v. Department of Interior, 526 U.S. 86, 119 S.Ct. 1003, 1008, 143 L.Ed.2d 171(1999), we find the repeated use of singular nouns to characterize the defaulted loans and the creditor seeking garnishment throughout 1095a(a) to be more convincing evidence of Congressional intent than the solitary use of the plural noun "loans" in the opening sentence of the section.Moreover, we find that the grammatical construction of 1095a suggests that the word "loans" as used in 1095a(a) refers only to those debt instruments held by the Secretary for which the Secretary is authorized to seek garnishment, not all of the loans that either the Secretary or a guaranty agency may seek to collect by garnishing the debtor's pay.

Although we must look beyond specific words and terms to the "language and design of the statute as a whole" when ascertaining the plain meaning of the statute, we find the district court's reliance upon 20 U.S.C. 1092c inappropriate.Legal Environmental Assistance Foundation, Inc. v. United States Environmental Protection Agency, 118 F.3d 1467, 1474(11th Cir.1997)(quotingK Mart Corp. v. Cartier, Inc., 486 U.S. 281, 291, 108 S.Ct. 1811, 1818, 100 L.Ed.2d 313(1988)).This section requires that: "To the extent practicable, and with the cooperation of the borrower, eligible lenders shall treat all loans made to a borrower under the same section of part B of this subchapter as one loan and shall submit one bill to the borrower for the repayment of all such loans...."20 U.S.C. 1092c(a).Section...