Court Opinion

ID: 9464222
Source: CourtListenerOpinion
Date Created: 2023-08-04 23:27:49.293364+00
Date Added: 2024-06-11T17:38:31.023281
License: Public Domain

BRIGHT, Circuit Judge,
concurring:
While I am satisfied to concur in the result of the case, I do not agree with the rationale offered by the court. Given the facts of this case, the private action versus state action distinction is not warranted by Perez v. Campbell, 402 U.S. 637, 91 S.Ct. 1704, 29 L.Ed.2d 233 (1971), and its use may lead to inconsistent results, depending upon whether the creditor college is a public or private institution.
Under the court’s analysis, Webster College may validly refuse to issue transcripts to former students who have discharged loan obligations through bankruptcy for the sole reason that it is a private college. Because it is a private rather than public institution, its refusal to issue transcripts is a “nonlegal, informal means of inducing the debtor to make payments,” at 1272, and not state action standing “ ‘as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress,’ ” which are embodied in the Bankruptcy Act. Perez v. Campbell, 402 U.S. at 649, 91 S.Ct. [1704] at 1711, quoting Hines v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 85 L.Ed. 581 (1941).
Assuming arguendo that a public institution’s refusal to issue a transcript is a state action conflicting with the purposes and provisions of the Bankruptcy Act and vulnerable under the Supremacy Clause, the court’s rationale could lead to the anomalous result that a state school is obligated to furnish transcripts to a bankrupt former student but, until he or she pays the discharged educational loan, a private school is not.
The Perez holding does not require such antithetical results. Perez presented the issue of whether an Arizona statute that took away a bankrupt’s privilege, namely the license to drive, conflicted with the debtor discharge provisions of section 17 of the Bankruptcy Act, 11 U.S.C. § 35 (1970). As the court today observes, at 1273, the effect of the Arizona statute was to give judgment creditors a powerful weapon with which to force bankrupts to pay their debts despite their discharge. The statute acted to deny the “fresh start” contemplated by the bankruptcy laws, see, e. g., Perez v. Campbell, 402 U.S. 637, 648, 91 S.Ct. 1704, 29 L.Ed.2d 233 (1971); Williams v. United States Fidelity and Guaranty Co., 236 U.S. 549, 35 S.Ct. 289, 59 L.Ed. 713 (1915), and, accordingly, it was struck down by the Supreme Court.
A college transcript differs radically from the essential driver’s license at stake in Perez.- A student who obtains a degree from a college acquires not only the present benefit of that education, but also a fund of knowledge of lifelong value. In other words, it is not like purchasing an article of consumable goods that immediately is consumed or even durable goods with more lasting usefulness. Instead, an education yields ever-continuing benefits.
Webster College, which has conferred upon now-bankrupt, former students an education represented by a degree, has taken no steps to penalize appellants in their use *1278of knowledge gained in college, nor has it sought to prevent them from exhibiting a degree to the world at large. Rather, Webster College refuses further to enhance the benefit of those degrees by certification of the transcripts. That transcript represents far more in intangible worth than its mere two dollar cost of reproduction, for its embodies an additional certification of the debtors’ already-received, but unpaid for, degrees, and provides the bankrupts with entry into graduate studies.' Indeed, issuance of the transcripts affords these debtors a recommendation by the college of their intellectual worth.
Section 14 of the Bankruptcy Act speaks in terms of barring a creditor’s affirmative action. The discharge bars (“enjoins”) creditors whose debts are discharged from “instituting or continuing any action or employing any process to collect such debts as personal liabilities of the bankrupt.” 11 U.S.C. § 32(f) (1970). Additionally, Local Loan Co. v. Hunt, 292 U.S. 234, 244, 54 S.Ct. 695, 699, 78 L.Ed. 1230 (1934), emphasizes the underlying primary purposes of the Bankruptcy Act to give debtors a fresh start, “a new opportunity in life and a clear field for future effort, unhampered by the pressure and discouragement of preexisting debt.”10
I agree with appellants that the above-cited code section and the fresh start principle of Local Loan Co. v. Hunt should be applied generously and broadly in favor of the bankrupt. But in my view, neither the statute nor the fresh start principle applies here.
First, Webster College merely declined to confer any additional benefits upon the debtors by furnishing transcripts of their grades for the unpaid educational courses. Otherwise, it in no way coerced the debtors to pay the discharged debts. Second, appellants have obtained far more than the fresh start contemplated by the Bankruptcy Act — they have obtained a head start because each has secured something of value that cannot be lost or taken away and which will give each appellant a continuing, lifelong economic benefit. No college, public or private, should be required to enhance such a benefit by issuing a transcript when it has not been paid for its services. The equities here lie with the college.
I recognize that situations may arise where a student has received no substantial benefit from his or her education, but nevertheless needs a transcript, and I reserve judgment about such instances. Such is not the case in this appeal.

. In Local Loan Co. v. Hunt a creditor argued that an assignment of future-earned wages to secure a loan was the equivalent of a lien, and should survive the discharge of the debt in bankruptcy. The Supreme Court held against the creditor, ruling that even if it were a lien under state law, it would conflict with the policy of the Bankruptcy Act and therefore did not survive discharge. The situation presented in this case bears no resemblance to Local Loan Co. There the “fresh start” goal of the Bankruptcy Act was completely undercut by a state law that created security interests in future earnings. Here the debtors not only have a “fresh start” by virtue of the discharge of their educational debts, but they retain the goods, namely their education, for which the debts were incurred. The only penalty they suffer is the loss of an additional benefit, a transcript that certifies and enhances the value of their education.