Court of Appeals of Indiana | Memorandum Decision 18A-CC-1061 | October 29, 2018 Page 1 of 14

MEMORANDUM DECISION

Pursuant to Ind. Appellate Rule 65(D), 

this Memorandum Decision shall not be 

regarded as precedent or cited before any 

court except for the purpose of establishing 

the defense of res judicata, collateral 

estoppel, or the law of the case.

ATTORNEYS FOR APPELLANT

Seth Row

Daniel Bogatz

Cleveland, Ohio

ATTORNEY FOR APPELLEE

T. Andrew Perkins

Rochester, Indiana

I N T H E

COURT OF APPEALS OF INDIANA

National Collegiate Student 

Loan Trust 2006-4,

Appellant-Plaintiff,

v.

Debra Vance (Bock),

Appellee-Defendant.

October 29, 2018

Court of Appeals Case No.

18A-CC-1061

Appeal from the

Fulton Superior Court

The Honorable

Wayne E. Steele, Judge

Trial Court Cause No.

25D01-1601-CC-50

Altice, Judge.
Court of Appeals of Indiana | Memorandum Decision 18A-CC-1061 | October 29, 2018 Page 2 of 14

[1] Debra Vance, now known as Debra Bock,1co-signed on a student loan for 

another individual, who never made payments on the loan. National Collegiate 

Student Loan Trust 2006-4 (Lender) filed a complaint against Vance to collect 

on the delinquent loan. Lender filed a motion for summary judgment, and 

Vance filed her own motion for summary judgment. Following a hearing, the 

trial court granted summary judgment in favor of Vance, and Lender now 

appeals, raising three issues that we consolidate and restate as: whether the trial 

court erred when it determined that Vance’s debt on the student loan had been 

discharged in her Chapter 7 bankruptcy.

[2] We reverse and remand.

Facts and Procedural History

[3] On October 22, 2006, Vance co-signed a student loan promissory note with 

Charter One Bank, N.A. (Charter One) for an Astrive Education Loan for Sean 

P. Dehoney (Student) to attend Axia College. The principal amount of the loan

including a prepaid finance charge was $19,398.91, which funds were disbursed 

to Student pursuant to the contract on November 9, 2006. In December 2006, 

the loan was assigned by Charter One to National Collegiate Funding, LLC 

through a 2006-4 Pool Supplement, and on that same date, National Collegiate 

Funding, LLC assigned the account to Lender through a Deposit and Sale 

 

1

For the sake of simplicity and consistency, we will use the name Vance in this decision as that is the name 

that appears in the relevant loan documents.
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Agreement, assigning all right, title, and interest. No payment was ever made 

on the student loan. 

[4] In June 2013, Vance filed a petition for bankruptcy under Chapter 7 of the 

Bankruptcy Code. According to Vance, she listed the student loan as a

scheduled debt, but its dischargeability was not expressly litigated in the 

bankruptcy proceeding. In September 2013, Vance received a general discharge 

pursuant to 11 U.S.C. § 727 (Section 727), and the bankruptcy case was closed 

in June 2014.

[5] In January 2016, Lender filed a Complaint in the Fulton Superior Court against 

Vance to collect on the student loan debt, stating that the total amount due at 

that time including accrued interest was $34,597.78. Lender attached to its 

Complaint the Loan Credit Agreement and the Note Disclosure Statement. 

Vance by counsel filed an Answer, asserting as an affirmative defense 

that,“[w]hile the Complaint appears to reference a student loan, which under 

certain circumstances would be excepted from a discharge in a Chapter 7 case, 

the type of student loan contained in the Complaint is not the type of student 

loan excepted from a discharge in a Chapter 7 Bankruptcy case,” and “[a]ny 

claim . . . contained in the Complaint is barred from collection and was 

discharged in the Defendant’s bankruptcy case pursuant to the discharge

order.” Appellant’s Appendix Vol. 2 at 19. Vance attached to her Answer the 

Discharge of Debtor (Discharge) dated September 16, 2013. The Discharge

directed the debtor to “SEE THE BACK OF THIS ORDER FOR 

IMPORTANT INFORMATION,” and, on the reverse side was an 
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“EXPLANATION OF BANKRUPTCY DISCHARGE IN A CHAPTER 7

CASE.” Id. at 21. It stated, “Most, but not all, types of debts are discharged if 

the debt existed on the date the bankruptcy case was filed.” Id. It continued:

Debts That are Not Discharged

Some of the common types of debts which are not discharged in 

a chapter 7 bankruptcy are:

d. Debts for most student loans[.]

Id. (emphasis in original).

[6] In March 2017, Lender filed its Motion for Summary Judgment, arguing that 

Lender and Vance entered into a credit agreement, Vance failed to make 

required payments and is in default, no genuine issues of material fact existed,

and Lender was entitled to judgment as matter of law. In its designation of 

evidence, Lender designated, in addition to the Complaint and Answer, the 

Affidavit of Dudley Turner, who was employed by Transworld Systems Inc. 

(TSI), the company that was “the Subservicer for [Lender] pertaining to the 

education loan” at issue. Id. at 38. According to Dudley’s Affidavit, TSI 

maintained loan account records and documentation concerning the subject 

student loan. The Affidavit included seven attachments, one of which was the 

Credit Agreement that contained the following pertinent provision:

12. I understand and agree that this loan is an education loan 

and certify that it will be used only for costs of attendance at 

the School. I acknowledge that the requested loan is subject to 
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the limitations on dischargeability in bankruptcy contained in 

Section 523(a)(8) of the United States Bankruptcy Code 

because either or both of the following apply: (a) this loan was 

made pursuant to a program funded in whole or in part by The 

Education Resources Institute, Inc. (“TERI”), a non-profit 

institution, or (b) this is a qualified education loan as defined 

in the Internal Revenue Code. This means that if, in the event 

of bankruptcy, my other debts are discharged, I will probably 

still have to pay this loan in full.

Id. at 45 (emphasis in original). 

[7] In April 2017, Vance filed her Response to Lender’s motion for summary 

judgment and, separately, filed her own Motion for Summary Judgment. 

Vance asserted that “either there are genuine issues of material fact in this case” 

and Lender’s motion should be denied, “OR, in the alternative, that there are 

no genuine issues of material fact, and that [Vance] is entitled to judgment as a 

matter of law[.]” Id. at 89. In her Response, Vance initially argued, “clearly a 

genuine issue of material fact” existed as to whether the debt was discharged in 

her bankruptcy case, specifically, “whether the education loan that is the subject 

of [Lender]’s Complaint is the type of debt which is excepted from a discharge 

or not.” Appellant’s Appendix Vol. 2 at 90. Vance recognized that, under the 

Bankruptcy Code, certain student loans are not generally dischargeable but 

argued that the student loan in this case “was not a government loan, but a 

private loan” and, further, that the subject loan was not a “qualified education 

loan” as that term is defined by the Internal Revenue Service; therefore, she 

argued, “the type of loan in this case is not the type of loan excepted from 
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discharge in a bankruptcy case.” Id. at 92. Vance asserted in her Response that 

Lender “presented no evidence” that the loan qualified “for an exception to 

[her] bankruptcy discharge” and thus Lender “failed to satisfy its burden of 

proof.” Id. at 93. 

[8] Alternatively, Vance asserted in her Response that she was entitled to summary 

judgment because the debt was listed on her bankruptcy schedules, and “even if 

this debt was not listed on her schedules, her case was a ‘no asset’ case which . . 

. did not require debts to be listed on the . . . schedules for them to be 

discharged,” and, in any event, she “provided proof” that the bankruptcy 

provision indicating that certain student loans are not discharged in bankruptcy 

“does not apply to the loan” in question. Id. at 93.

[9] Vance filed a Designation of Evidence “relevant to the genuine issues of 

material fact,” which designated, in addition to the pleadings and attachments, 

an Affidavit by Vance. Vance averred that (1) Student “is not my spouse or 

dependent,” (2) “[t]he loan proceeds were paid to [him] . . . and they were spent 

by him for his own expenses,” (3) she filed bankruptcy and “listed the loan that 

is the subject of [Lender]’s Complaint . . . on [her] bankruptcy schedules,” (4) 

her bankruptcy was “a ‘no asset’ case in that no assets were collected and

distributed to creditors by the trustee,” (5) she was granted a discharge in the

bankruptcy case on September 16, 2013, as evidenced by the Discharge of 

Debtor form attached to her Affidavit, and (6) her bankruptcy case was closed 

on June 23, 2014, as evidenced by the Order Approving Final Account, 

Discharging Trustee and Closing Case, attached to her Affidavit. Id. at 78-79.
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[10] Lender timely filed a Reply, asserting that the student loan was excepted from 

discharge. Lender argued that pursuant to 11 U.S.C. § 523(a)(8) (Section 523), 

as well as federal case law, “[s]tudent loans are generally not dischargeable in 

bankruptcy unless the debtor proves that excluding the loans from discharge 

would impose an undue hardship on the debtor.” Appellant’s Appendix Vol. 2 at 

96 (citing Tetzlaff v. Educ. Credit Mgmt. Corp., 794 F.3d 756, 758 (7th Cir. 2015)). 

It further asserted that Vance was incorrect in claiming that it was Lender’s 

burden to establish that the debt was not discharged, as the burden was on her 

to establish that the educational loan was excluded from discharge, “typically 

[accomplished] by filing an adversary proceeding” in bankruptcy court. Id. at 

95. In response to Vance’s assertion that the loan in question did not qualify for 

the definition of a “qualified educational loan,” Lender stated, first, that a 

determination of whether the loan was a “qualified educational loan” was 

unnecessary to the analysis based on other provisions of Section 523, and 

second, any such determination “could only properly be adjudicated by the 

Bankruptcy Court.” Id. Lender maintained that it was entitled to judgment as 

a matter of law, but that, should the trial court disagree that Lender was entitled 

to judgment, Lender consented “to an indefinite stay . . . so as to permit 

[Vance] to seek a declaratory judgment from the bankruptcy court clarifying 

whether the instant loan was discharged.” Id. 

[11] At the March 2018 hearing on the parties’ motions for summary judgment, 

Lender argued that (1) typically student loans are not discharged unless the 

debtor presents evidence of undue hardship, and (2) the debtor or other party
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responsible for payment has the burden of proving that the student loan was 

discharged. Vance responded that it is the creditor’s obligation to prove that the 

specific debt trying to be collected is excepted from discharge. Vance also 

clarified that she was not claiming undue hardship; rather, her position was that 

“this is not the kind of student loan that is accepted [sic] from discharge,” 

arguing that Lender had not “made the required showing” that this student loan 

meets the “qualified education loan” definition and that she was thus entitled to 

summary judgment. Transcript at 6, 8. Alternatively, Vance asserted “there are 

multiple genuine issues of material fact.” Id. at 9. Lender offered that Lender 

would be amenable to an indefinite stay “just to allow time for the Bankruptcy 

Court to determine whether or not this particular loan was discharged.” Id. 

Vance maintained that a stay was not warranted, arguing that Lender should 

have asked for relief from discharge in the two years that the case had been 

pending. Following the hearing, the trial court issued an order summarily 

granting judgment in Vance’s favor. Lender now appeals.

Discussion & Decision

[12] There is no dispute that Vance co-signed on the student loan or that the claimed 

amount is due and owing to Lender. Vance’s position is that the trial court 

correctly entered summary judgment in her favor because the debt was 

discharged in her Chapter 7 bankruptcy. Lender maintains, on the other hand, 

that the trial court should have granted summary judgment in its favor because 

the student loan debt was nondischargeable pursuant to Section 523 and no 
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genuine issues of material fact remained as to whether Vance owed the debt on 

the defaulted student loan.

[13] When reviewing a grant or denial of a motion for summary judgment, our 

standard of review is the same as it is for the trial court. McCullough v. 

CitiMortgage, Inc., 70 N.E.3d 820, 824 (Ind. 2017). “The moving party ‘bears 

the initial burden of making a prima facie showing that there are no genuine 

issues of material fact and that it is entitled to judgment as a matter of law.’” 

Id. (quoting Gill v. Evansville Sheet Metal Works, Inc., 970 N.E.2d 633, 637 (Ind. 

2012)). If the movant carries its burden, “‘then the nonmoving party must 

come forward with evidence establishing the existence of a genuine issue of 

material fact.’” Id. In determining whether summary judgment is proper, the 

reviewing court considers only the evidentiary matter the parties have 

specifically designated to the trial court. Ind. Trial R. 56(C). We construe all 

factual inferences in the nonmoving party’s favor and resolve all doubts as to 

the existence of a material issue against the moving party. McCullough, 70 

N.E.3d at 824.

[14] In determining whether Vance’s debt on the student loan was discharged, as she 

claims, or nondischargeable, as Lender claims, we must examine relevant 

Bankruptcy Code provisions. We begin by examining Section 727, under 

which Vance received her Discharge. Section 727 provides in relevant part:

(b) Except as provided in section 523 of this title, a discharge under 

subsection (a) of this section discharges the debtor from all debts 
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that arose before the date of the order for relief under this 

chapter[.]

(Emphasis added). Section 523 states, in relevant part:

(a) A discharge under section 727 . . . does not discharge an 

individual debtor from any debt --

(8) unless excepting such debt from discharge under this 

paragraph would impose an undue hardship on the debtor 

and the debtor’s dependents, for --

(A) (i) any educational benefit overpayment or loan 

made, insured, or guaranteed by a governmental 

unit, or made under any program funded in whole 

or in part by a governmental unit or nonprofit 

institution; or (ii) an obligation to repay funds

received as an educational benefit, scholarship, or 

stipend; or

(B) any other educational loan that is a qualified 

education loan, as defined in section 221(d)(1) of 

the Internal Revenue Code of 1986, incurred by a 

debtor who is an individual[.]

“‘The legislative history of section 523(a)(8) indicates that the statute was meant 

to be self-executing so that the creditor would not be required to file a complaint 

to determine the dischargeability of a student loan.’” In re Clark, 341 B.R. 238, 

248 (Bankr. N.D. Ill. 2006) (quoting United States v. Wood, 925 F.22d 1580, 1583 

(7th Cir. 1991)). “Thus, it is the debtor who is required to file an adversary 

proceeding against the holder of a student loan debt in order to show that the 
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debt should be discharged.” Id. (citing In re Hanson, 397 F.3d 482, 484 (7th Cir. 

2005)).

[15] The parties agree that Section 523(a)(8) has been interpreted to mean that four 

types of educational loans are not included in a Section 727 discharge, absent 

undue hardship on the debtor, and those four types are: (1) loans made, 

insured, or guaranteed by a governmental unit; (2) loans made under any 

program partially or fully funded by a government unit or nonprofit institution; 

(3) loans received as an educational benefit, scholarship, or stipend; and (4) any 

“qualified educational loan” as that term is defined in the Internal Revenue 

Code.

[16] Vance, while focusing exclusively on the last of the four types, regarding any 

“qualified educational loan,” contends that Section 523 does not apply to the 

student loan at issue. Specifically, she argues that the student loan does not 

meet the definition of a “qualified education loan” as that term is defined by the 

Internal Revenue Code in 26 U.S.C. § 221(d)(1), which states in relevant part: 

(1) Qualified education loan. -- The term “qualified education 

loan” means any indebtedness incurred by the taxpayer solely to 

pay qualified higher education expenses--

(A) which are incurred on behalf of the taxpayer, the taxpayer’s 

spouse, or any dependent of the taxpayer as of the time the 

indebtedness was incurred,

(B) which are paid or incurred within a reasonable period 

of time before or after the indebtedness is incurred, and
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(C) which are attributable to education furnished during a 

period during which the recipient was an eligible student.

(Emphasis added). Vance’s argument is that since the student loan in question 

was “not incurred on behalf of [Vance], or [Vance]’s spouse or dependent, then 

the loan is not a qualified education loan under 26 U.S.C. § 221(d)(1) and is not 

excepted from discharge under 11 U.S.C. § 523(a)(8).” Appellee’s Brief at 15. 

[17] Lender, however, maintains that the “qualified education loan” exception – in 

Section 523(a)(8)(B) – is not the relevant subsection and thus it is unnecessary

to determine whether the student loan at issue satisfies that definition.2 Lender 

explains that, instead, “the subject student loan was excepted from discharge 

under subsection (A)(i) because it was ‘an educational overpayment or loan 

made, insured, or guaranteed by a governmental unit, or made under any 

program funded in whole or in part by a governmental unit or nonprofit 

institution.’” Appellant’s Brief at 14 (quoting from and adding emphasis to 11 

U.S.C. § 523(a)(8)(A)(i)). 

[18] Lender urges that “the record plainly establishes” that the student loan in 

question was an education loan that was funded in whole or in part by a nonprofit institution. Appellant’s Brief at 14. In doing so, Lender refers to the loan 

documents, including the Credit Agreement which states in bolded letters:

 

2 Lender states that, not only is it unnecessary to decide that issue, but also any such determination would 

need to be made by the bankruptcy court. 
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12. I understand and agree that this loan is an education loan 

and certify that it will be used only for costs of attendance at 

the School. I acknowledge that the requested loan is subject to 

the limitations on dischargeability in bankruptcy contained in 

Section 523(a)(8) of the United States Bankruptcy Code 

because either or both of the following apply: (a) this loan was 

made pursuant to a program funded in whole or in part by The 

Education Resources Institute, Inc. (“TERI”), a non-profit 

institution, or (b) this is a qualified education loan as defined in 

the Internal Revenue Code. This means that if, in the event of 

bankruptcy, my other debts are discharged, I will probably still 

have to pay this loan in full.

Appellant’s Appendix Vol. 2 at 45 (italics added). Other designated documents, 

namely the account’s payment history and the 2006-4 Pool Supplement, which 

transferred and assigned the loan to National Collegiate Funding LLC, also 

reflect that TERI was a guarantor.3 Lender argues that it thereby designated 

evidence showing that the student loan was made pursuant to a program 

funded by a non-profit institution, TERI, and, absent undue hardship to the 

debtor, which Vance does not claim, the student loan was not discharged in 

Vance’s Section 727 general discharge from bankruptcy. We agree. 

 

3 As pointed out by Lender, case law provides that a TERI-guaranteed loan program, even if TERI did not 

fund the debtor’s specific loan, meets the standard set forth in Section 523(a)(8)(A)(i). Appellant’s Brief at 15-

18 and Reply Brief at 11; see e.g., In re O’Brien, 419 F.3d 104, 106 (2nd Cir. 2005) (holding that Section 

523(a)(8) was applicable where TERI “merely guaranteed, without funding” the debtor’s particular loan,

obtained through Key Bank, as 523(a)(8) requires only that loan was “made under any program funded in 

whole or in part by” a non-profit institution); Decker v. EduCap, Inc., 476 B.R. 463, 468 (W.D. Pa. 2012) 

(finding that Section 523(a)(8)(A)(i) was satisfied where non-profit entity guaranteed loan that was funded by 

Bank of America, noting “Congress’ intentionally stringent limits on the dischargeability of educational 

loans”); In re Drumm, 329 B.R. 23, 35 (Bankr. W.D. Pa. 2005) (finding that a non-profit guarantee was 

enough and that meaningful financial contribution or meaningful financial risk are not required).
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[19] Where, as here, Lender designated evidence that the loan was not discharged, 

the burden shifted to Vance to show that a genuine issue of material fact existed

precluding summary judgment. Although Vance suggested that a question of 

fact remained as to whether the loan was a “qualified educational loan” under 

Section 523(a)(8)(B), we agree with Lender that such a determination is not 

warranted under the facts of this case, where the loan satisfied the parameters of 

Section 523(a)(8)(A).

4

[20] Having found that Lender established, through Section 523 and the designated 

evidence, that the student loan at issue was not discharged in bankruptcy, and 

where there is no dispute as to the fact that Vance co-signed on the loan or as to

the amount due and owing, Lender has established that it is entitled to 

judgment as a matter of law on its claim to collect the debt. Accordingly, we 

reverse the trial court’s entry of summary judgment in favor of Vance and 

remand with instructions to enter judgment in Lender’s favor on its Complaint 

against Vance.

[21] Judgment reversed and remanded with instructions.

Brown, J. and Tavitas, J., concur.

 

4 Courts have determined Section 523(a)(8)(A)(i)’s discharge exception for government or non-profit-funded 

loans applies to non-related, non-student debtors, like Vance. See Corletta v. Texas Higher Educ. Coordinating 

Bd., 531 B.R. 647, 653 (W.D. Tex. 2015); Cockels v. Mae, 414 B.R. 149, 155 (E.D. Mich. 2009).