A considerably large percentage of the United States population holds student loan debt. In addition, most individuals who attend higher education institutions in today’s society graduate with some debt. Phillip Kuzma knows this too well.
Kuzma was sued by the National Collegiate Student Loan Trust (NCSL) for over $30,000 after allegedly defaulting on the loans he took out while a student at the University of New Orleans. After suing Kuzma, the NCSL thought they could get an easy judgment by using a procedural mechanism, a default judgment. Kuzma’s case discussed below shows the need to dot your i’s and cross your t’s when filing a default judgment in a Louisiana Court.
In 2013, the NCSL filed a lawsuit, seeking approximately $30,000 in loans and $5,000 in interest as a result of nonpayment by Kuzma. In addition, the NCSL requested the court to order Kuzma to pay their attorney fees. The NCSL claimed these were the requirements expected of those who defaulted.
There were some issues in the case regarding serving Kuzma with the notice of the NCSL’s motion filed with the court, intending to reclaim the money Kuzma owed. However, Kuzma never filed an answer with the Court, even though it was said that he was served with the notice. As a result, the NCSL requested the district court to issue a default judgment. If filed properly a default judgment would have allowed NCSL to start the process of trying to collect that judgment against Kuzma.
The district court ruled in favor of NCSL, granted the default judgment, and ordered Kuzma to pay over $35,000, along with 25% of attorney’s fees. Kuzma appealed this decision, claiming that the trial court did not have enough evidence to order Kuzma to pay that sum.
Kuzma claimed that the NCSL failed to make a prima facie case, which the Louisiana Code of Civil Procedure article 1702 requires for a default judgment. A prima facie case is the production of sufficiently established evidence for the court to rule in favor of a party. The Court of Appeals found that the district court did not have enough evidence to order Kuzma to pay that lump sum, and NCSL did not provide enough information to deserve the judgment the district court made.
The NCSL failed to submit a statement of Kuzma’s loan account and verify whether or not the amount owed was correct. The appeals court also noted an affidavit verifying the account’s correctness was not submitted. That statement would have helped the court justify the validity of the amount owed rather than simply a statement of the amount owed. These facts led to the Court of Appeals reversing the district court’s opinion, finding that the NCSL did not meet the requirements for a default judgment.
Student loan debt is an overwhelming issue in the United States today and is often confusing, especially for young adults. You should consult an attorney if you have any questions or issues regarding possible legal issues resulting from student loan payments.
Additional Sources: National Collegiate Student Loan Trust v. Kuzma
Written by Berniard Law Firm Writer: Ainsley Ayres
Additional Berniard Law Firm Article On Civil Matters: What Happens When Someone Won’t Repay the Money I Loaned Them?