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In re Adamo

619 F.2d 216 (1980)

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In re Adamo

United States Court of Appeals for the Second Circuit

619 F.2d 216 (1980)

Facts

The Higher Education Act of 1965 (HEA) included a provision that made certain student-loan debts nondischargeable in bankruptcy. The portion of the HEA containing the nondischargeability provision was repealed and replaced by the Bankruptcy Reform Act of 1978 (BRA), which contained a provision that made the same student-loan debts nondischargeable in bankruptcy. The effective date for the BRA was 11 months after the repeal date for the HEA. The BRA was the result of conference committee negotiations that reconciled a bankruptcy-reform statute passed by the United States House of Representatives (House) and a similar statute passed by the United States Senate (Senate). The bill underwent several revisions before it was finalized, and the Senate Judiciary Committee later commented on the inadvertent gap that was contained in the final version of the bill. The BRA also contained a separate “savings” provision intended to preserve the rights of the parties to bankruptcy petitions filed pursuant to previous bankruptcy law. A New York bankruptcy court granted 21 petitions for the discharge of student-loan debt that were filed during this 11-month gap. The court reasoned that because the HEA had been repealed and the BRA was not yet effective at the time the petitions were filed, there was no statute in effect that authorized the denial of a discharge. The United States District Court for the Western District of New York affirmed the discharge. The matter was appealed.

Rule of Law

Issue

Holding and Reasoning (Bartels, J.)

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