Lockhart v. United States
Lockhart sued the United States after receiving notice that his social security payments would be reduced to offset his outstanding federal student loans. Lockhart argued that the statute of limitations for collection of his student loans had already passed when the government began reducing his social security payments. This case involves the intersection of several complex federal statutes. The Debt Collection Act of 1982 allowed the government to use administrative offset to collect debts owed to the federal government but imposed a ten-year statute of limitations. A 1983 amendment to the Social Security Act suggested that the government cannot reduce social security payments to offset student loans. A 1991 amendment to the Higher Education Assistance Act removed all statutes of limitations on the collection of federal student loans. Finally, a 1996 amendment to the Debt Collection Act removed the restriction preventing the government from offsetting outstanding debts by reducing social security payments, but left the ten-year statute of limitations in place. The legislative history of these statutes does not clarify whether the ten-year statute of limitations in the Debt Collection Act applies to Lockhart’s outstanding loans.
The district court dismissed Lockhart’s suit stating that he had failed to state a claim, and the Ninth Circuit Court of Appeals affirmed, holding that the ten-year statute of limitations in the Debt Collection Act did not apply to Lockhart’s loans.
Question Presented:
Whether the Department of Education can collect defaulted student loans by offsetting a portion of a debtor's Social Security benefits without regard to
the ten-year limitation period under the Debt Collection Act, 31 U.S.C. ยง 3716(e)(1), given that Congress has expressly abrogated all otherwise applicable statutes of limitations for the collection
of student loans.
