In re Burton
| Decision Date | 11 January 2006 |
| Docket Number | Adversary No. 05-5016-SCS.,Bankruptcy No. 04-53297-SCS. |
| Citation | 339 B.R. 856 |
| Court | U.S. Bankruptcy Court — Eastern District of Virginia |
| Parties | In re Duane L. BURTON, Debtor. Duane L. Burton, Plaintiff, v. Educational Credit Management Corp., Continental Service Group, Inc., Defendants. |
Lorin D. Hay, Virginia Beach, VA, for Debtor.
Rand L. Gelber, Rockville, MD, for Defendant.
STEPHEN C. ST. JOHN, Bankruptcy Judge.
This matter came on for trial on November 1, 2005, upon the Complaint by Debtor to Determine Dischargeability of Educational Loans under § 523(a)(8) of the Bankruptcy Code. At the conclusion of the trial, the Court took this matter under advisement. The Court has jurisdiction over these proceedings pursuant to 28 U.S.C. §§ 157(b)(2) and 1334(b). Venue is proper pursuant to 28 U.S.C. §§ 1408 and 1409. Upon consideration of the evidence and arguments presented by counsel at the trial and the pleadings submitted, the Court makes the following findings of fact and conclusions of law.
Duane L. Burton ("Burton") filed under Chapter 7 of the Bankruptcy Code on December 15, 2004. Burton filed an adversary complaint on March 30, 2005 (the "Complaint") to determine the dischargeability of educational loans owed to Educational Credit Management Corporation and Continental Service Group, Inc. (collectively "ECMC"). Burton's Complaint alleges that he owes $96,156.29 and $16,501.58 plus interest on two separate educational loans, and that these debts should be discharged "on the grounds that excepting such debt from discharge would impose an undue hardship on the debtor and the dependents of the debtor." Pl. Compl., at 1. ECMC filed an Answer to Complaint on April 22, 2005 (the "Answer") admitting that Burton was indebted to them, but denying that the amounts alleged by Burton were the correct amounts of the claims. ECMC requests that the Court "[d]eclare the indebtedness evidenced by the Note(s) as a non-dischargeable obligation pursuant to 11 U.S.C. § 523(a)(8)." Def. Answer, at 2. Prior to trial, the parties stipulated that the Plaintiff's Chapter 7 Voluntary Petition and Schedules and the Defendant's Exhibits A-H should be admitted into evidence.1 The parties also stipulated that Duane Burton would be the only witness called to testify.
Burton, who is currently 44 years old, took out various educational loans in the 1980's to finance his college education at the University of Rochester and the State University of New York. He attended school from 1982 to 1989, and attempted to gain a Bachelor of Science degree in Sociology.2 Burton's Schedules in his bankruptcy filing reflect that he owes more than $130,000.00 in educational loans. His Schedule F lists a debt to ECMC in the amount of $96,000.00; a debt to New York Higher Education Services in the amount of $12,087.00; and a debt to Sallie Mae Consolidation in the amount of $22,296.00, as well various Student Loan Service Center fees.3 Burton testified that he made a couple of payments on his educational loans in the late 1980's and early 1990's; however, his testimony makes it clear that his payment history is very limited.4 Further, he testified that he contacted Sallie Mae in the late 1980's or early 1990's about a loan consolidation, and that payments for his student loans have been made through tax intercepts. Burton also testified that he has a history of medical problems that have impacted his ability to stay continuously employed and therefore make his student loan payments.
Burton testified that while in high school he enlisted in the Marines through a delayed entry program. Burton testified that he served in the Marines from 1977 through 1981 and during that time worked as an aircraft recovery technician. Burton further testified that he received a non-service medical discharge from the Marines after he started having stress-related problems that occurred after learning his oldest brother had been killed.6 After leaving the Marines, Burton moved in with his parents, and after a few months he began working at a steel mill. Burton did not testify as to how long he worked at the steel mill, but he did testify that after working at the steel mill, he took another job working as a housekeeper.
In 1982, Burton enrolled in the University of Rochester ("Rochester"), and he testified that he stayed at Rochester for five years. Burton further testified that he left Rochester in 1987 because he was having problems coping and he had started drinking. However, Burton also testified that he was hospitalized for approximately 30 days in 1988 while at Rochester, because he had a nervous breakdown. The Court is unsure how to reconcile this testimony given the conflicting testimony regarding dates.7
After leaving the University of Rochester, Burton testified that he attended the University of Buffalo ("Buffalo"). While he was at Buffalo, Burton testified that he went to a Veterans Affairs Hospital8 that was near where he was living at the time, and it was there that he began to learn about his illness. Additionally, Burton testified that he has had problems with cocaine which began around his junior or senior year in college.9
Burton testified that he eventually left Buffalo and enrolled at the State University of New York at Brockport ("Brockport"), where he stayed for about a year. He further testified that he left Brockport because he "started having some issues mentally ... [and] started drinking heavily ...." Tr. at 47.
After leaving Brockport, Burton testified that he "kind of floundered around" but then he started "getting [his] life together." Tr. at 49. He worked various jobs, including as a lifeguard and camp counselor, and eventually got a job at Eastman Kodak Company. Burton testified that he worked there for about two years doing factory work, and then transferred to the equipment support division because of a referral from his former wife. He worked in the equipment support division for approximately two years, but left after his divorce.10
Burton testified that he moved to Hampton Roads in 1998, and that he moved away from New York "because either I was going to kill myself or kill somebody, basically." Tr. at 51. Further, he testified that someone in the Veterans Affairs Hospital told him that there was a place in Virginia for veterans, and that it could help him start over.
Since moving to Virginia, Burton has had a sporadic employment record, with jobs at Gateway, Nextel, King's Creek Plantation and Real-Time International. Additionally, he testified that the highest paying job he ever had was with Nextel for $14.00 per hour,11 and that job only lasted for two months. Burton stated he lost his job with Nextel, where he worked as a customer service representative, because he was having problems with his medication and had to be hospitalized.
According to Burton, he worked at Gateway for two years and that was his longest period of employment.12 While at Gateway, Burton testified that "things started looking up," and he had a doctor who was working with him and his medications. Tr. at 11. He stated that he was starting to excel at Gateway, but then began to suffer side effects from his medications, such as paranoia and tremors. Further, he testified that he started hearing voices and had to take a lot of time off work, which eventually led to his termination at Gateway.
Burton testified that he worked at King's Creek Plantation for about a year, but that he was terminated when he started having problems with his medication. According to Burton, the problems with his medicine "would make [him] tired during times when [he] was supposed to work," and this led to him requesting time off, which ultimately led to his termination. Tr. at 10.
Burton's most recent job was in 2004 with Real-Time International, where he sold time shares. Burton's answer to the Defendant's Interrogatories reveals that he only worked twenty-five hours per week at Real-Time, thus making him a part-time employee. Def. Exh. E., Interrogatory No. 4. Further, he testified he worked for Real-Time International for about two months, but then the company closed due to financial problems.
Since working for Real-Time International in 2004, Burton testified that he has attempted to find work. According to Burton, he has attempted to gain employment through a Social Security program; by signing up with the Virginia Employment Commission; and by applying for jobs online.13 He also testified that he has done odd jobs for a friend to make money, such as digging ditches and building a fence.14 Additionally, Burton testified that he attempted to operate his own business sometime during the latter part of 2004. He stated that he tried to start a marketing business with the help of Social Security through the Ticket to Work Program. However, he stated that the business did not succeed because he did not have money to purchase materials and that he did not think through how much it would cost to start a business.
Burton testified that he knows how to build computers and he built the computer he presently uses, but that he has been unable to get a job in that field because he lacks Microsoft certification. Burton stated that he has looked into getting computer certification through the Peninsula Work Force Development Center but that he cannot afford the cost of the certification. He testified that it costs approximately $6,000.00 to $8,000.00 to obtain certification with Microsoft and that to his knowledge there are no free programs.
As previously noted, Burton's testimony reveals that his medical difficulties initially began when he was a young man in the Marines. He left the Marines in 1981 after receiving a medical...
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