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Ceased to be a student ruling on bankruptcy case

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    Posted: 08/April/2014 at 11:08am
This is an important case posted here for your info....  I've copied form another subforum.  Thanks to LtClout for providing this link.

That is: The BIA refers to: "a loan" -- not "all loans" -- as noted by the Bankruptcy Registrar (judge) in the Hildebrand (Re), 2010 SKQB 321 case.

See: http://canlii.ca/en/sk/skqb/doc/2010/2010skqb321/2010skqb321.html

Also: The language of "ceased to be a student" follows from the language of "a loan." Logically, then, "ceased to be a student" is relative to the specific loan that was issued. 

This particular court ruling is the best I've seen so far. It also cites a number of other relevant cases.

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Johnny View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 08/April/2014 at 11:22am
It does apply to the student loan that is aligned with that study period.  The opposing system always tries to manipulate laws to make it apply to things that it really has no jurisdiction over.  This is very typical of government and the financial industry.  They feel that their interpretations and way of thinking is what matters over everything else.  One other example is how Hewlett Packard (which is actually BC Revenue Services) takes the position that an income tax set-off transaction falls under a definition of "voluntary" payment, which it is not. However, they call a brown cow a white cow and then proceed to violate a person's legal rights because they feel that they are entitled to without having to9 held accountable for it.

This is what happens when a private company that is big (like HP owning BC Revenue Services, and Davis and Henderson owning the NSLSC) adopt government power and methodologies.  In the above case, Hewlett Packard is dictating what a person;s legal rights are.  No one has challenged them yet, other than The CFW Group of course. It should be interesting to see what their response is to the opening argument submitted.


Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote kymbeee Quote  Post ReplyReply Direct Link To This Post Posted: 21/July/2014 at 9:51pm
My last student loan was Spring 2000, that was also my last semester as a full-time student before graduating with an Associate of Arts degree. Over the years, I've taken the odd course here or there, including courses that work has paid for at BCIT (Organizational Behaviour, and Supervisory Skills).

My most recent course was this year. Previously this would have meant my student loans were not eligible to be included in a bankruptcy until 2019, providing that I don't take any further courses, correct?

I don't do legalese very well, but if I'm understanding correctly, this establishes a precedent for my status as having ceased to be a student in 2000 when I received my final student loan disbursement? That would be really good news. Clap  Even my trustee didn't seem entirely sure when we first spoke.

Irrelevant to the above, I've paid $26K of a total of $30K in loans. I think they've received more than their money's worth in interest!!! I would continue paying the loans, but my trustee has told me not to. Haven't filed just yet, doing that this week. I've just been concerned that my student loans wouldn't be discharged and I'd be in arrears on payments. If there's one thing I learned a long time ago, it's that you don't F around with student loan payments!!!
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Post Options Post Options   Thanks (1) Thanks(1)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 22/July/2014 at 9:52am
Bankruptcy trustees rely mostly on subjective interpretation, or as you described , the "uh I don't really know" card.  It is actually their job to know.  Bankruptcy is a business just the Canada Student Loans Program is now. 

The law prescribes a period of 7 years from cessation of studies whereas a student is eligible for discharge. Key words here are "eligible" and of course "for discharge". Opinions are not good enough, unfortunately.  However, basede on my experience over the course of 25 years, the argument is what counts without injecting one's opinion. 

Bankruptcy is a dangerous territory these days because many go bankrupt who are really not bankrupt. That is the business and sales of the industry at work. If you do file an assignment, and the Crown oposes your discharge when the trustee makes the motion after 9 months, then you have to present the facts based on what they law says and appeal.  The trustee's job is just to bankrupt you and get out.  This is why you read and hear about so many people caught in insolvency purgatory.

It is clear that the reason you are applying for a discharge is "because" of the student debt as part of the bankruptcy proceedings. If you attended studies after the fact it should not count. The law applies to bankruptcy and student loans. So, the limitation period with respect of an application to have student loans discharged is what applies. That is how you have to think. Remove opinion and present facts.

Will you be discharged automatically? Probably not if the government stands to lose money.  So, you need to be prepared for the opposition of your discharge, and then ask your trustee to make the appeal for discharge based on the fact that you are not able to contribute, and/or should not have to because of whichever reason that restricts you from doing so. Or, why the student loan should be discharged in the event that they oppose based on the rhetorical argument that you should not be discharged because you ceased to be a student after which had any involvement of the prior student loan.
Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

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Post Options Post Options   Thanks (1) Thanks(1)   Quote Cienfuegos59 Quote  Post ReplyReply Direct Link To This Post Posted: 01/September/2014 at 3:18pm
If you used student loans for the Associate of Arts degree, but did not use them for the subsequent courses, you should be fine.

Section 178(1)(g) of the Bankruptcy and Insolvency Act only applies to government student loans not personally financed education (whether that's through you own money, bursaries, or scholarships). So, if you financed the subsequent courses on your own, then 2000 should be the year you begin counting the 7-year regulation.

That being said, they will probably oppose your claim. That's what they did to me. But, I included this case law (below) in my files and they withdrew their opposition a week before my court date:

http://www.canlii.org/en/sk/skqb/doc/2005/2005skqb75/2005skqb75.html?searchUrlHash=AAAAAQAGbGVkb3V4AAAAAAE
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Post Options Post Options   Thanks (0) Thanks(0)   Quote kymbeee Quote  Post ReplyReply Direct Link To This Post Posted: 01/September/2014 at 6:52pm
Thank you both so much for your responses. I filed August 2nd, so I will definitely keep this info at hand if the discharge is opposed. I'll bring this up to my trustee when I see her later this month.
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Post Options Post Options   Thanks (1) Thanks(1)   Quote treevee Quote  Post ReplyReply Direct Link To This Post Posted: 26/March/2015 at 2:05pm
Hi kymbeee, 

Just wondering if you've had any progress on your claim? Would love an update. 

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Post Options Post Options   Thanks (0) Thanks(0)   Quote kymbeee Quote  Post ReplyReply Direct Link To This Post Posted: 29/March/2015 at 12:44am

Thanks for asking treevee! My discharge date is coming up in just over a month, on May 6th. My trustee didn't see any reason it should be a problem, although Scotiabank has been a pain the you-know-what to deal with. My trustee contacted them several times after they kept sending me letters and the collection agency kept calling me last fall, in spite of me telling them that I had filed for bankruptcy. I think that pretending to be dumb is standard operating procedure with them.

Anyhow, when I had my second meeting with my trustee a couple of months ago, she said everything was on track. I see her each month to make my payment, and she always checks in on how I'm doing and reassures me that the end is near. :)

On a side note, I must say that after having heard horror stories about trustees, I have been blessed with a wonderful one. In fact, I pretty much broke down and cried at the end of my second meeting when I told her how grateful I am for her. She has been truly awesome, more like a counsellor than anything else, and she really wants me to be successful with my life.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote treevee Quote  Post ReplyReply Direct Link To This Post Posted: 30/March/2015 at 6:03am
That's awesome, kymbeee! I am submitting a consumer proposal in the coming weeks and was really nervous about it being rejected because I took some classes a few years ago (that I paid for myself). I have student loans from 8 years ago that are the main reason for my consumer proposal. I am making payments of almost $600 a month and barely scratching the surface of the principal. 

This gives me hope! 
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Post Options Post Options   Thanks (0) Thanks(0)   Quote kymbeee Quote  Post ReplyReply Direct Link To This Post Posted: 31/March/2015 at 1:29pm
Good luck treevee!! I'll try to remember to come back and post once it's all said and done, but if I forget you can always post me a reminder, lol.

K.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote eurogrrl Quote  Post ReplyReply Direct Link To This Post Posted: 04/May/2015 at 7:26pm
I hate to be the bearer of bad news, but it doesn't matter how you financed subsequent courses/programs - you're still screwed.  Here's my story:

- graduated in May 2002
- enrolled in a post-graduate certificate in January 2009 (funded privately); sent in confirmation of enrollment on the advice of a bankruptcy trustee
- declared bankruptcy in September 2009; discharged May 2010
- NSLC did not oppose discharge; Ontario Student Loan opposed discharge; Bank of Nova Scotia did not attend
- Swore affidavit in April 2011 to have Ontario Student Loan included in bankruptcy - hardship application ($26,000/year gross income)
- Application rejected by the court in November 2012, stating that the application was premature and before 5 years had elapsed (eligible date of application: September 2014)
- After 5 years of earning less than $30,000/year, find employment paying $38,000/year in April 2014 and am told by the trustee's lawyer that I'm ineligible to re-apply under the hardship guidelines due to earning too much (single; no dependents).
- Pay off the OSL ($4,000) in full in December 2014, only to be contacted by the NSLC (for the first time since before declaring bankruptcy) and Bank of Nova Scotia for loans totaling $20,000.

This nightmare effectively centres around 4 months (January - April 2009) of suspended loan payments due to returning to school, which I wouldn't have been able to pay anyway due to unemployment. If anyone has any advice, it would be appreciated.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote kymbeee Quote  Post ReplyReply Direct Link To This Post Posted: 05/May/2015 at 6:14pm
Hmm, that's not cool at all. The student loan deferment while in the certificate program seems to be the problem. Even though you weren't getting further loans from them, you were still using the services of the student loan system in order to defer payments, and to have declared bankruptcy so soon after is probably what triggered the problems.

I wish I had some advice eurogrrl. I think things might have been different if they hadn't been deferring payments while you went back to school. I have very little knowledge of the whole process, but it was my understanding however that if a debtee does not oppose the discharge, there wasn't anything they could do about it afterwards. If you can, I would seek legal advice and not from a trustee either. Their degree of competence or even helpfulness seems to differ vastly from one to another.

My situation is different. I have had $0 income the whole time of my bankruptcy. I never missed a single payment prior to that, I continued to make my payments even when I was taking part-time courses. I paid close to $28,000 of a $30,000 debt. I was so proud that within 18 months I would have paid them all off, and then a serious case of 'life' hit me and I had to take a prolonged medical  leave of absence from work.

My trustee has assured me that I'm in the clear now, but even if NSLC or Scotiabank come after me, I owe very little money and would actually gladly pay it off. The biggest chunk of my debt was credit cards, the student loan portion was minute in comparison.

All I can say is good luck, and I hope you find a way out of it!
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