*

The Honorable Jerome Farris, Circuit Judge for the United States Court of Appeals for the Ninth Circuit, sitting

by designation. 

RECOMMENDED FOR FULL-TEXT PUBLICATION

Pursuant to Sixth Circuit Rule 206

File Name: 05a0048p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT _________________

In re: MICHAEL J. OYLER,

Debtor.

____________________

MICHAEL J. OYLER,

Plaintiff-Appellee,

v.

EDUCATIONAL CREDIT MANAGEMENT

CORPORATION,

Defendant-Appellant.

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No. 03-4505

 On Appeal from the United States Bankruptcy Appellate Panel for the Sixth Circuit.

No. 02-06090—Russ Kendig, Bankruptcy Judge.

Argued: December 3, 2004

Decided and Filed: February 3, 2005 

Before: DAUGHTREY, COOK, and FARRIS, Circuit Judges.*

_________________

COUNSEL

ARGUED: Daniel S. Fisher, St. Paul, Minnesota, for Appellant. Donald M. Miller, Sr., Canton,

Ohio, for Appellee. ON BRIEF: Frederick S. Coombs, III, HARRINGTON, HOPPE &

MITCHELL, Youngstown, Ohio, for Appellant. Donald M. Miller, Sr., Canton, Ohio, for Appellee.

_________________

OPINION _________________

COOK, Circuit Judge. Education Credit Management Corporation (“ECMC”) appeals the

Bankruptcy Court’s discharge of Michael Oyler’s student loans from ECMC and asks us to consider

whether that debt poses an “undue hardship” to Oyler. Unlike the Bankruptcy Court and Bankruptcy

Appellate Panel (B.A.P.), we hold that it does not and thus reverse.

1
No. 03-4505 In re Oyler Page 2

I

Oyler is the pastor of a Messianic Jewish church that he founded in June 1998. He is fortyeight years old and married with three children. Before founding his church, Oyler earned

bachelor’s and master’s degrees, worked as a salesman and audio engineer, and once owned his own

business.

At the time of trial, Oyler’s family’s income had been less than $10,000 for each of the past

two years—well below poverty level for a family of five. The church congregation provided the

family with an apartment and a salary around $1,200 per month, varying depending upon

congregation members’ contributions. The family had no health insurance, and Oyler suffered four

retinal detachments as a result of a medical condition, scleral buckle. The only debts scheduled in

his Chapter 13 plan were the $40,000 worth of student loans from ECMC, and, at the time of trial,

Oyler was current in his monthly payments of $50 into the plan. 

In June 2002, Oyler began an adversary proceeding in Bankruptcy Court to discharge his

student loans under 11 U.S.C. § 523(a)(8). At the end of trial, the court concluded that repayment

of the student loans would constitute an undue hardship, and entered a judgment discharging the

debt. ECMC timely appealed, first to the B.A.P., which affirmed the judgment, and then to this

court.

II

In an appeal from the B.A.P., we focus on the Bankruptcy Court’s decision, and review its

factual findings for clear error and its legal conclusions de novo. Behlke v. Eisen (In re Behlke), 358

F.3d 429, 433 (6th Cir. 2004). Whether student loans pose an undue hardship is a legal question

we review de novo. Cheesman v. Tennessee Student Assistance Corp. (In re Cheesman), 25 F.3d

356, 359 (6th Cir. 1994).

III

The Bankruptcy Code allows discharge of student loans only when repayment “will impose

an undue hardship on the debtor and the debtor’s dependents.” 11 U.S.C. § 523(a)(8). Most circuit

courts follow the standard for “undue hardship” adopted by the Second Circuit which requires a

three-part analysis: “(1) that the debtor cannot maintain, based on current income and expenses, a

‘minimal’ standard of living for herself and her dependents if forced to repay the loans; (2) that

additional circumstances exist indicating that this state of affairs is likely to persist for a significant

portion of the repayment period of the student loans; and (3) that the debtor has made good faith

efforts to repay the loans.” Brunner v. New York State Higher Educ. Serv. Corp., 831 F.2d 395 (2d

Cir. 1987). 

We have recognized and frequently applied the three prongs of Brunner in our undue

hardship cases (and also our health-education-assistance-loan unconscionability cases), but have

hesitated to explicitly adopt Brunner as the exclusive analytical framework. See, e.g., In re

Cheesman, 25 F.3d at 359-60 (undue hardship); Rice v. United States (In re Rice), 78 F.3d 1144,

1149-50 (6th Cir. 1996) (unconscionability). Instead, we have considered the Brunner test, along

with other factors such as: (1) the debt amount; (2) the interest rate; (3) the debtor’s claimed

expenses and current standard of living to evaluate whether the debtor has attempted to minimize

expenses; (4) the debtor’s income, earning ability, health, education, dependents, age, wealth, and

professional degrees; and (5) whether the debtor has attempted to maximize income by seeking or

obtaining employment commensurate with her education and abilities. Miller v. Pa. Higher Educ.

Assistance Agency (In re Miller), 377 F.3d 616, 623 (6th Cir. 2003). 
No. 03-4505 In re Oyler Page 3

1

For those circuits formally adopting the Brunner test, see Brunner, 831 F.2d 395; Pa. Higher Educ. Assistance

Agency v. Faish (In re Faish), 72 F.3d 298, 306 (3d Cir. 1995); United States Dep’t of Educ. v. Gerhardt (In re

Gerhardt), 348 F.3d 89, 91 (5th Cir. 2003); In re Roberson, 999 F.2d 1132, 1135 (7th Cir. 1993); United Student Aid

Funds, Inc. v. Pena (In re Pena), 155 F.3d 1108, 1112 (9th Cir. 1998); Educ. Credit Mgmt. Corp. v. Polleys, 356 F.3d

1302, 1309 (10th Cir. 2004); Hemar Ins. Corp. of Am. v. Cox (In re Cox), 338 F.3d 1238, 1241 (11th Cir. 2003). And

the Fourth Circuit, while not yet expressly adopting Brunner, applies the test. See, e.g., Ekanasi v. The Educ. Res. Inst.

(In re Ekanasi), 325 F.3d 541 (4th Cir. 2003). 

 We believe our current “hybrid-Brunner” model for assessing undue hardship foments

confusion because our so-called “other factors” actually fit easily into the well-accepted Brunner

analytical template. For instance, we have labeled a debtor’s expenses and standard of living and

the amount of the debt as independent factors, yet Brunner-test courts regularly scrutinize these

same factors under the first prong of the test. See, e.g., United States Dep’t of Educ. v. Gerhardt (In

re Gerhardt), 348 F.3d 89, 92 (5th Cir. 2003). We have cabined as a separate factor a debtor’s

attempt to maximize income, but most courts conceptualize that inquiry as the controlling aspect of

Brunner’s second prong. See Storey v. Nat’l Enter. Sys. (In re Storey), 312 B.R. 867, 872 (Bankr.

N.D. Ohio 2004). And nearly all of the bankruptcy courts in this circuit apply the test and employ

these other factors within the Brunner framework. See Jackson v. Educ. Credit Mgmt. Corp., No.

3:03CV7692, 2004 WL 952882, at *2 (N.D. Ohio Apr 30, 2004) (“Bankruptcy courts within this

district have consistently applied the Brunner test.”). Given then, that the Brunner construct

subsumes the criteria we have treated as distinct and independent, and that the Brunner formulation

easily accommodates factors we look to in evaluating undue hardship, we opt to join other circuits1

in adopting the simpler rubric of the Brunner test.

IV

Applying the Brunner test, we conclude that Oyler fails its second prong, because he has

shown no “additional circumstances . . . indicating that this state of affairs is likely to persist for a

significant portion of the repayment period.” Such circumstances must be indicative of a “certainty

of hopelessness, not merely a present inability to fulfill financial commitment.” In re Roberson, 999

F.2d at 1136. They may include illness, disability, a lack of useable job skills, or the existence of

a large number of dependents. See Kraft v. New York State Higher Educ. Serv. Corp. (In re Kraft),

161 B.R. 82, 84 (Bankr. W.D.N.Y. 1993). And, most importantly, they must be beyond the debtor’s

control, not borne of free choice. See Fischer v. State Univ. of New York (In re Fischer), 23 B.R.

432, 434 (Bankr. W.D. Ky. 1982). Choosing a low-paying job cannot merit undue hardship relief.

See Healy v. Massachusetts Higher Educ. (In re Healey), 161 B.R. 389, 395 (E.D. Mich. 1993) (“A

resolute determination to work in one’s field of dreams, no matter how little it pays, cannot be the

fundamental standard from which ‘undue hardship’ . . . is measured.”). 

Oyler’s choice to work as a pastor of a small start-up church cannot excuse his failure to

supplement his income so that he can meet knowingly and voluntarily incurred financial obligations.

By education and experience he qualifies for higher-paying work and is obliged to seek work that

would allow debt repayment before he can claim undue hardship. See In re Storey, 312 B.R. at 872

(debtor must do everything in his power to improve financial situation); In re Kraft, 161 B.R. at 86-

87 (debtor needed to look for all job opportunities before claiming undue hardship). The

Bankruptcy Court erred by not considering that Oyler’s decision not to maximize his earnings,

though commendable, was voluntarily made after he also voluntarily incurred the debt that he now

wishes to discharge. 
No. 03-4505 In re Oyler Page 4

2

Though Oyler may not qualify for undue-hardship discharge due to his decision to pursue a low-paying career,

and his failure to supplement his income, other avenues of relief remain open to him. As counsel for ECMC suggested

at oral argument, Oyler could enter the William D. Ford consolidation program’s “income contingent repayment plan”

to alleviate some of the burden of repayment. See 20 U.S.C. § 1087e(d)(1)(D). 

V

 Because Oyler’s circumstances fail to meet the Brunner standard to qualify for unduehardship discharge of his student loans, we reverse the decision of the Bankruptcy Appellate Panel.2