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Court to rule on student loan debts

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on Jun 15, 2009 at 10:07 am
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The Supreme Court, agreeing on Monday to hear four new cases, said it would decide whether an individual who owes on a student loan may wipe out the debt — at least partly — in a bankruptcy without showing that the debt posed an “undue hardship.” The case is United Student Aid Fund v. Espinosa (08-1134).

The Court also said it would spell out the rights of service station operators to sue to challenge the loss, or non-renewal, of their franchises from oil companies.  The Court consolidated for review the cases of Mac’s Shell v. Shell Oil (08-240) and Shell Oil v. Mac’s Shell (08-372).

In a third case, the Court will consider putting constitutional limits on states’ authority to restore storm-eroded beaches along the ocean or lakeshores, when such action modifies private property boundary lines.  (Stop the Beach Renourishment v. Florida (08-1151).

The fourth new case brought back to the Court an issue it had agreed to decide, but did not resolve, six years ago: when two companies agree to send their disputes to arbitration, may a court order that process to go forward as a class action, if the contract says nothing on that issue.  The issue arises anew in Stolt-Nielsen S.A., et al., v. Animalfeeds International Corp. (08-1198).

In two rulings on the merits, the Court struck down, by a 7-2 vote, a tax imposed by the city of Valdez, Alaska, on cargo ships that used its port (Polar Tankers v. Valdez, 08-310), and it issued a unanimous ruling clarifying the findings that an immigration judge must make in order for a conviction of a crime to be used as the basis for deportation (Nijhawan v. Holder, 08-495).

The Court, moving toward a summer recess starting late this month, has 14 decisions to go.  It announced Monday that it would sit again on Thursday, and more decisions are expected then.

The Court, in another of Monday’s orders, invited the U.S. Solicitor General to offer the federal government’s views on an issue under the bankruptcy law’s Chapter 13 — what is the formula bankruptcy courts are to use in deciding how much a Chapter 13 debtor has available to pay creditors who hold no security, when a repayment plan is being fashioned.  There is no deadline for the S.G.’s response. The case is Hamilton, Trustee, v. Lanning (08-998).

Among the cases the Court refused to hear on Monday was a constitutional dispute over the federal government’s powers to set aside federal and state laws that interfere with the building of the long fence on the U.S.-Mexico border, part of an effort to restrict drug traffic and thwart terrorist movements.  The Court had turned aside that controversy a year ago (07-1180).  This time, the Justices examined the new case at eight separate private meetings, then still came to the conclusion that it would not rule on it.  The case is El Paso County, et al., v. Napolitano (08-751).  As usual, the Court offered no explanation for denial of review.

In another denial, the Court refused to hear a claim that anti-Castro sentiment was so rampant in the Miami, Fla., area that a group of five Cubans could not get a fair trial there on charges of spying for that government. The case had stirred a strong international reaction.  It was Campa, et al., v. U.S. (08-987).

Filings in granted cases and the CVSG case are below the jump.

Docket: 08-240; 08-372
Title: Mac’s Shell Service, Inc. v. Shell Oil Products Company; Shell Oil Products Company v. Mac’s Shell Service
Issue: Under what circumstances may a service station operator bring suit against an oil refiner or distributor for “constructive termination” under the Petroleum Marketing Practices Act?

Docket: 08-998
Title:  Hamilton v. Lanning
Issue: Did the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 eliminate judicial discretion by requiring an above-median income debtor to pay to unsecured creditors the net result reported on Official Form 22C?

Docket: 08-1134
Title:  United Student Aid Funds, Inc. v. Espinosa
Issue:  Where a debtor declares to discharge a student loan debt in his Chapter 13 bankruptcy plan, has the debtor satisfied the due process requirements of Mullane v. Cent. Hanover Bank & Trust Co, and does the fact that the debtor failed to initiate an adversary proceeding render the enforceability of the discharge order under 11 U.S.C. 1327(a)inapplicable?

Docket: 08-1151
Title: Stop the Beach Renourishment, Inc. v. Florida Department of Environmental Protection, et al.
Issue: Whether the state’s legislation to restore storm-eroded beaches along the ocean or lakeshores, modifying the private property boundary line, constitutes a judicial taking or violates the due process clause

Docket: 08-1198
Title:  Stolt-Nielsen S.A., et al. v. AnimalFeeds International Corp.
Issue: Whether imposing class arbitration on parties whose arbitration clauses are silent on that issue is consistent with the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq.

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