"The dischargeability of student loan debts scheduled on a bankruptcy petition is controlled by the law in effect when the petition in bankruptcy is filed." United States. v. Bradburn, 75 B.R. 108, 110 (Bankr. S.D. Ind. 1987) (citing In re Kammerud, 15 B.R. 1, 9 (Bankr. S.D. Ohio 1980)). On August 14, 1978, at the time Defendant filed for bankruptcy, "the dischargeability of student loan debts was governed by Section 439A of the Higher Education Act."
2. Section 439A of the Higher Education Act, at the time Davis filed for bankruptcy, see United States v. Bradburn, 75 B.R. 108, 110 (Bkrtcy.S.D.Ind. 1987) (the presumption and the extent of dischargeability is controlled by the law in effect when the debtor files for bankruptcy), provided that student loans were presumptively nondischargeable in bankruptcy, unless the debt had been due and owing for five years, "except that prior to the expiration of the five year period, such loan may be released only if the court in which the proceeding is pending determines that payment from future income or other wealth will impose an undue hardship on the debtor or his dependents." 20 U.S.C. § 1087-3, repealed by Act of November 6, 1978, Pub.L. No. 95-598, § 317, 92 Stat. 2678; United States v. Bradburn, 75 B.R. at 110.
This Court agrees. Likewise, in United States v. Bradburn, 75 B.R. 108 (S.D.Ind. 1987), the District Court observed that the precursor statute to section 523(a)(8) "was intended to be self-executing, and the Government was not required to file a complaint to determine the nondischargeability of the student loan debt." Id. at 110 (citing S.Rep. No. 95-989, 95th Cong., 2d Sess. 79, U.S. Code Cong. Admin. News 1978, pp. 5787, 5864, 5685, which contains the legislative history of section 523(a)(8)).
11 U.S.C. § 523. Although the court has been able to locate only one relevant case outside the bankruptcy courts, every published decision has uniformly held section 523(a)(8) to be "self-executing." E.g., United States v. Bradburn, 75 B.R. 108 (S.D.Ind. 1987); In re Frech, 62 B.R. 235 (Bankr.D.Minn. 1986); In re Bawden, 55 B.R. 459 (Bankr.M.D.Ala. 1985); In re Keenan, 53 B.R. 913 (Bankr.D.Conn.
N. Dakota Bd. of Higher Educ. v. Frech (In re Frech), 62 B.R. 235 (Bankr. D. Minn. 1986). 75 B.R. 108 (S.D. Ind. 1987). 85 B.R. 579 (D. Kansas 1988).
Cf In re Evaul, 152 B.R. 31, 32 (Bankr.W.D.N.Y. 1993) (judicial lien secured a non-dischargeable student loan debt). The cases cited by Mount Sinai, United States v. Bradburn, 75 B.R. 108 (S.D.Ind. 1987), In re Driscoll, 57 B.R. 322 (Bankr.W.D.Wis. 1986), and In re Edwards, 50 B.R. 933 (Bankr.S.D.N.Y. 1985) are inapposite and not controlling because they were decided prior to the adoption of § 523(a)(17) and the amendments made to § 522(c). If Mount Sinai is alleging that the debt owed it by the Debtor is non-dischargeable under § 523(a)(17), it must file an adversary proceeding.
Section (a)(8), on the other hand, is self-executing; educational institutions need not raise a complaint regarding the possibility of their debts being discharged. U.S. v. Bradburn, 75 B.R. 108, 110 (S.D.Ind. 1987), citing S.Rep. No. 95-989, 95th Cong., 2d Sess. 19, U.S. Code Cong. Admin. News 1978, pp. 5787, 5864, 5865; In re Smith, 103 B.R. 392, 395 (Bkrtcy.N.D.N.Y. 1988). Congress has therefore recognized the different contexts in which these two types of proceedings commence — (a)(15) by creditor impetus and (a)(8) by the debtor.
Senate Report, supra, at 79, U.S. CODE at 5865. See also United States v. Bradburn, 75 B.R. 108 (S.D.Ind. 1987) (construing 20 U.S.C.A. 1087-3, Code § 523(a)(8)'s predecessor, which was in effect at the time debtor filed her petition in November 1977, to be self-executing and finding student debt not discharged). The Court cannot ignore the established practice, supported by the aforementioned body of law, of commencing an adversary proceeding to determine the dischargeability of a debt, including student debt.
See, e.g., In re Nunn, 788 F.2d 617 (9th Cir. 1986); U.S. v. Bradburn, 75 B.R. 108 (S.D.Ind. 1987); In re Eckles, 52 B.R. 433 (D.Wis. 1985); In re Osborn, 72 B.R. 691 (Bankr.W.D.Mo. 1987). With respect to the second reason, even if the scholarship debt is nondischargeable under Chapter 7, this Court will not base a finding of bad faith or deny confirmation of the proposed plan on that fact alone.