Debt Collection Improvement Act

Lockhart v. United States

Issues

The Supreme Court faces an issue of statutory construction and interpretation in this case. The language in the Debt Collection Improvement Act (as of 1982) conflicts with language in the Higher Education Assistance Act (as of 1991) as to the time limitation on collection of debt owed to the government. The former prohibits collection of debt more than 10 years outstanding, while the latter contains a clause explicitly stating that there is no such limitation. The Court will hold that either the earlier statute is controlling because it has not been explicitly repealed (thus, shielding debt more than 10 years outstanding), or else the later statute's language constructively repeals the earlier provision (thus, making all debt to the government susceptible for collection).

 

The language of the Higher Education Assistance Act clearly countermands any statute of limitations found in other statutes or administrative law that may bar the government from collecting, through administrative asset or garnishment, outstanding student loan debt. However, the amended Debt Collection Act, the Debt Collection Improvement Act, which was passed after the Higher Education Assistance Act, included language that expressly prevented administrative offset of social security benefits if the claim was outstanding for more than ten years. The Eighth and Ninth Circuits disagree as to whether the ten year statute of limitations applies to prevent offset of social security benefits. If Congress intended to protect social security benefits from administrative offset, then seriously delinquent debtors will be excused from repayment in this fashion. However, should the Court decide that Congress intended to prospectively abrogate the statute of limitations when it passed the Higher Education Assistance Act, then the government will be able to collect overdue student loans by withholding a certain amount from the debtor's social security benefits. Either way, statutory safeguards exist to protect those beneficiaries whose sole income is social security from offsets of excessive amounts.

Questions as Framed for the Court by the Parties

Do the Social Security Act and the Debt Collection Improvement Act bar the United States from withholding social security benefits to collect student loan debt that has been outstanding for more than ten years, as the Eighth Circuit has held, or does the Higher Education Act eliminate any such bar, as the Ninth Circuit held below?

A. Statutory Background

The Debt Collection Act of 1982 (31 U.S.C ? 3716) provided for the collection of outstanding debts owed to the United States through means of administrative offset.? Under this statute, the United States could apply to an administrative agency in order to recoup debt owed by an individual.

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