In re Shryock, Bankruptcy No. 88-20920-7
| Decision Date | 14 July 1989 |
| Docket Number | Bankruptcy No. 88-20920-7,Adv. No. 88-0106. |
| Citation | 102 BR 217 |
| Parties | In re Kevin Dale SHRYOCK, Sharon Frances Shryock, Debtors. Kevin Dale SHRYOCK, Sharon Frances Shryock, Plaintiffs, v. PITTSBURG STATE UNIVERSITY, Defendant. |
| Court | U.S. Bankruptcy Court — District of Kansas |
Roberta L. Comer, Comer & Dunn, Edwardsville, Kan., for plaintiffs/debtors.
Nancy L. Ulrich, Asst. Atty. Gen., Topeka, Kan., for defendant.
David C. Seitter, Overland Park, Kan., Trustee.
This matter came for hearing on the complaint of Kevin Dale Shryock and Sharon Frances Shryock to determine the dischargeability of student loans under section 523(a)(8). Plaintiff/debtor Kevin Dale Shryock appeared in person and through counsel, Roberta L. Comer. The defendant, Pittsburg State University, appeared by and through counsel, Nancy L. Ulrich.
Based on the stipulations, the pleadings, the exhibits, the testimony, and the record, this Court makes the following findings of fact:
1. The parties stipulate that plaintiff Kevin Shryock was a student at Pittsburg State University and that he graduated in May, 1982. The parties also stipulate that the student loans plaintiff borrowed from Pittsburg State University were subject to the provisions on student loans under section 523(a)(8). That plaintiff Sharon Frances Shryock, did not sign the promissory notes in question and is not obligated thereon.
2. The first student loan (Loan No. 1) advanced to plaintiff related to the period between August 14, 1980 and March 6, 1981, and the amount totaled $1500. The interest rate on Loan No. 1 was three percent (3%) and the grace period expired nine months after graduation.
3. The second student loan (Loan No. 2) advanced to plaintiff was for the period between August 17, 1981, and January 7, 1982, and totaled $1500. The interest rate on Loan No. 2 was four percent (4%) and the grace period expired six months after graduation.
4. Under the terms of plaintiff's promissory notes and Pittsburg State University's loan policies, plaintiff's first installments became due at the end of the first quarter after his grace periods expired. Loan No. 1 first became due on June 1, 1983, and Loan No. 2 first became due on March 1, 1983.
5. On July 6, 1988, Kevin Shryock filed a motion for relief under chapter 7, title 11, United States Code.
6. Plaintiff's original payment terms were $116.25 per quarter.
7. Before plaintiff's first installment became due, plaintiff wrote a note to Pittsburg State University and asked that his original payments be reduced or modified.
8. Plaintiff requested that his payments be reduced or modified until he received a Sallie Mae consolidation for all his student loans.
9. Before plaintiff's first installment became due, plaintiff also contacted Pittsburg State University by telephone and asked that his payments be reduced until he could consolidate all of his student loans. Plaintiff stated that he was financially unable to make payments under the original terms.
10. Pittsburg State University agreed to reduce plaintiff's payments to an amount which would cover the interest on his loans. If plaintiff made interest payments, he would not be in default and would remain eligible for a Sallie Mae consolidation.
11. As agreed, Mr. Shryock made payments to Pittsburg State University in amounts necessary to cover the interest on his loans.
12. Pittsburg State University, through Henry Stricklin, Loan Collections Officer, made an agreement with Kevin Shryock to modify his payments so he could get his consolidation. Henry Stricklin understood and intended the agreement to be binding on both parties.
13. Plaintiff understood that he made a request to Pittsburg State University to have his payments reduced or modified, and he agreed to make minimal payments in exchange for Pittsburg State University's agreement to forego collection. Plaintiff made the payments to Pittsburg State University that he agreed to make.
14. When plaintiff's initial consolidation was not granted in late 1983, his modified repayment schedule was extended, in case the consolidation program was reinstituted at a later date.
15. The regulations of Pittsburg State University required that a form OE 1120 "Request for Deferment of Repayment" must be filed at the time the first payment is due. No such Form OE 1120 was ever filed by Kevin Shryock, nor requested to be filed by officials of Pittsburg State University.
Under section 523(a)(8)(A), a student loan is excepted from discharge unless "such loans first became due before five years (exclusive of any applicable suspension of the repayment period) before the date of the filing of the petition.
In this case, there is no question that the loans...
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