Opinion ID: 710042
Heading Depth: 3
Heading Rank: 2

Heading: The Bryant Test

Text: 43 The Bryant test was set forth by the Bankruptcy Court for the Eastern District of Pennsylvania eight years after Johnson was decided. In re Bryant, 72 B.R. 913 (Bankr.E.D.Pa.1987). The Bryant court criticized the three-part Johnson test as unfortunately complicated and promulgated an alternative test for undue hardship. Id. at 915 n. 2. The Bryant court explained its standard in the following terms: 44 The test which we propose strives to place the element of objectivity into the process of decision-making in this area. We propose, as a starting position, to analyze the income and resources of the debtor and his dependents in relation to federal poverty guidelines established by the United States Bureau of the Census and determine the dischargeability of the student loan obligation on the basis of whether the debtor's income is substantially over the amounts set forth in those guidelines or not. If not, a discharge will result only if the debtor can establish unique and extraordinary circumstances which should nevertheless render the debt dischargeable. If the debtor's income is below or close to the guideline, the lender can prevail only by establishing that circumstances exist which render these guidelines unrealistic, such as the debtor's failure to maximize his resources or clear prospects of the debtor for future income increases. We feel that such a test will decrease, if not eliminate the resort to the unbridled subjectivity which seems to pervade many of the decisions in this area. 45 Id. at 915. Elaborating upon its new undue hardship exception standard, the bankruptcy court observed that [w]e find ourselves in disagreement with those courts which have denied discharges of student loans on the basis of whether any given expenses are justified, as these represent subjective value judgments concerning which we consider ourselves no better able to gauge than, generally, debtors themselves. Id. at 918. 46 We expressly reject and depart from this reasoning and analysis. The Bryant test's refusal (or at least extreme reluctance) to question whether certain expenses debtors have incurred can be justified seems inconsistent with Congress' dual legislative goals of eliminat[ing] debtor abuse of the educational loan program and preserv[ing] the fiscal integrity of the student loan program. Pelkowski, 990 F.2d at 744. The Bryant test does not adequately account for the fact that one of the most common reasons student-loan debtors find themselves in bankruptcy court is that their subjective value judgments are often (but not always) indicative of a spendthrift philosophy which a bankruptcy court should be competent to consider before discharging their student loans. 47 The Bryant court also expressed disagreement with the first inquiry of the Johnson policy test, which asks if the dominant purpose of the bankruptcy petition was to discharge the student debt. Johnson, 5 Bankr.Ct.Dec. at 544. The Bryant court declared that since avoiding the consequences of debts is normally the reason for filing for bankruptcy ... the fact that the Debtor seeks to discharge almost exclusively student loan obligations ... should be irrelevant. Bryant, 72 B.R. at 915 n. 2. We disagree. The purpose behind the debtor's bankruptcy petition is not irrelevant in this context because one of the reasons that Congress enacted Sec. 523(a)(8)(B) was in response to reports of students discharging student loan debts after graduation and subsequently accepting high-paying jobs. Wiese, Undue Hardship, supra, at 446. See Brunner, 831 F.2d at 396 (Congress intended to make the discharge of student loans more difficult than that of other nonexcepted debt.). For these reasons, we decline to adopt the Bryant test.