Townson v. Ruff (In re Ruff), 639 B.R. 772 (Bankr. N.D. Ga. 2022)
Mar 31, 2022OUTCOME: Win for Debtor
In Townson v. Ruff (In re Ruff), the Bankruptcy Court for the Northern District of Georgia held that the debtor’s student loan debt was not “consumer debt” for purposes of § 707(b), so her Chapter 7 ca ... se could not be dismissed for abuse under that section. The court focused on the debtor’s purpose in incurring the loans and the surrounding facts: she used the loan proceeds for tuition rather than living expenses, and she obtained the degree to improve her skills and increase her future earning potential, not for personal, family, or household consumption. Although the degree was not required for her current job and did not guarantee an immediate promotion, the court concluded that the loans were incurred with a profit-motivated, career-enhancement purpose, which took them outside the scope of “consumer debt” under § 101(8).
