LOCKHART v. UNITED STATES
In 2002 the U.S. began withholding a portion of Lockhart's Social Security payments to offset his debt on federally reinsured student loans that were more than 10 years overdue. Lockhart sued, arguing the offset was barred by the 10-year statute of limitations of the Debt Collection Act (1982). The district court dismissed Lockhart's suit, and the Ninth Circuit affirmed.
Could the United States offset Social Security benefits to collect a student loan debt that had been outstanding for over 10 years?
Legal provision: 31 U.S.C. 3716
Yes. In a unanimous opinion delivered by Justice Sandra Day O'Connor, the Court held that the Debt Collection Improvement Act made Social Security benefits subject to offset and that the Higher Education Technical Amendments removed the 10-year limit that would otherwise bar the offset.
Argument of Brian Wolfman
Chief Justice Roberts: We will hear argument next in Lockhart versus United States.
Mr. Wolfman: Mr. Chief Justice, and may it please the Court--
Section 207 of the Social Security Act contains a broad ban on the attachment of Social Security benefits that may be overridden if, in doing so, Congress expressly refers to Section 207.
Our basic position is that the effect of an express reference to Section 207 can go no further than the authority that is granted in the statute that includes the express reference.
Therefore, here, the Debt Collection Act, the statute that contains that express reference, prohibits offsets to collect claims that have been outstanding for more than 10 years.
Therefore, the Government lacks offset authority to collect Mr. Lockhart's older debts.
The Debt Collections Act's 10 year bar on the right of the Government to offset debt from governmental payments owing to debtors was enacted in 1982.
But, at that time, the Government did not have authority to offset Social Security benefits at all.
The Government's claim that there's no 10 year bar here relies entirely on a provision of the Higher Education technical amendments that overrode statutes of limitations for collecting student debts.
But that was passed in 1991, 5 years before the... before... the Government had authority to offset Social Security benefits at all.
That authority, as I've referred to, came only in 1996, in the Debt Collection Improvement Act, which did expressly refer to the Social Security Act's anti attachment provision.
Justice Scalia: Did... are... just as an initial matter, are you sure that one Congress can bind a future Congress that way, that Congress can pass a law that says, you know,
"In the future, no statute shall have X effect unless it says. "
--and then it writes in a phrase that has to be said?
Mr. Wolfman: --Well--
Justice Scalia: And then you have a future Congress that makes its intent entirely clear in a statute that does not use the magic words. I thought our cases held that, in such a situation, the will of the future Congress prevails--
Mr. Wolfman: --That--
Justice Scalia: --so long as it's clearly expressed.
Mr. Wolfman: --I will say that that is something that we've considered.
It's not briefed here, but I think the issue is not presented here.
And here's why because in... what occurred in 1996 comported with the express reference requirement.
The problem here is that... so, it said that they can offset Social Security benefits.
But it is contained in a statute that includes the 10 year bar.
So, even if the antiattachment provision did not exclude the express reference provision, it still... whatever allowed the attachment has to be, in our view, coincident with the statute in which the express reference--
Justice Breyer: It didn't contain the bar at the time that they said, "You can collect it".
In the later statute, which said,
"You now can collect out of Social Security. "
when they passed that, did it contain a 10 year bar?
Mr. Wolfman: --Yes, it did.
Justice Breyer: I thought the Higher Education Act said... as of what year did the Higher Education Act say,
"No statute of limitations applies to us? "
Mr. Wolfman: That was 1991.
Justice Breyer: Fine.
Mr. Wolfman: Yes.
Justice Breyer: --1991, it said,
"No statute of limitations applies to us. "
Then, in what year did the statute... was passed which said,
"And you can collect money out of Social Security payments for higher education? "
Mr. Wolfman: That occurred in 1996.
But, as I--
Justice Breyer: All right.
Why isn't that the end of it?
Mr. Wolfman: --The reason that's--
Justice Breyer: --so there was no... there was no statute of limitations applying to the Social Security Act; and then, in 1996, they say, "And now go get 'em".
Mr. Wolfman: --Because--
Justice Breyer: What can we do about that?
Mr. Wolfman: --Because, with respect, that's not what Congress said in 1996.
Justice Breyer: What did they say?
Mr. Wolfman: They didn't say, "Go get 'em".
What they did is, as an amendment to the Debt Collection Act, in the Debt Collection Improvement Act, they inserted permission to go... to offset Social Security benefits in a statute that has a 10 year bar.
Justice Breyer: It has a 10 year bar.
But the earlier 1991 Act says, "That doesn't apply to us".
Mr. Wolfman: --Yes, but... but, again, getting back... and I think this takes us back to Justice Scalia's question... that... the... there is a broad anti attachment provision.
There is an express reference requirement.
Our view is that the... that... those requirements can go no... the abrogation of the... of the bar to offset Social Security benefits, or to attach Social Security benefits in any way, can go no further than the statute in which that abrogation occurs.
And this statute has a 10 year bar.
So, if I can explain further, the Debt Collection Improvement Act, and the Debt Collection Act before it, has a 10 year bar.
It's not merely a statute of limitations.
It says that the Government has no authority to offset after the 10 year period, after the claim has been outstanding for more than 10 years.
That's the statute that includes the abrogation of the offset of Social Security benefits.
Justice Breyer: So, in other words, you're saying that that provision of the later statute that says,
"Go get 'em on Social Security. "
implicitly reads into it the 10 year bar that's in a different part of the statute.
Mr. Wolfman: Well, I--
Justice Breyer: So, it's as if it said,
"Go get 'em on Social Security, under 407, which is gone now, but only for 10 years. "
Mr. Wolfman: --Well--
Justice Breyer: Is that what your... I'm trying to understand this.
Mr. Wolfman: --That is our argument.
Justice Breyer: Yes.
Mr. Wolfman: That is our argument.
Justice Breyer: Okay.
Mr. Wolfman: But I would only qualify it--
Justice Breyer: The only problem is, it doesn't say that.
Mr. Wolfman: --No, I would disagree, Your Honor.
I would say that my only quarrel with your question is that it's not implicit, it is explicit.
The statute... the Debt Collection Improvement Act, as the Debt Collection Act before it, contains a 10 year bar on the authority of the Government to offset.
This is not a mere statute of limitations defense that can be waived.
This is a complete lack of authority to the... in the Government to offset.
Justice Kennedy: Are--
Mr. Wolfman: --the statute--
Justice Kennedy: --Are you saying that this has a purpose other than barring stable... stale claims?
It's simply designed to limit the offset provisions in order to allow other Federal programs to proceed and... I'm looking for some way for you to describe (e) as being something other than a limitations provision.
Mr. Wolfman: --Well, what it says--
Justice Kennedy: I think... because I think that would help you.
Mr. Wolfman: --Yes, and I think... that's exactly my point.
What (e) says is that this Act does not apply... and I'm quoting now...
"This Act does not apply when the claim has been outstanding for more than 10 years. "
That strikes us... you can call it "limitations" if you want, but it strikes us as a very powerful one.
Because it restricts the Government's ability to bring such a case--
Justice Kennedy: Well, if--
Mr. Wolfman: --for offset.
Justice Kennedy: --if we call it 1991 Act.
Mr. Wolfman: Well, I... with respect, I don't think that the actual nomenclature matters that much, but I will distinguish it from what the law normally calls a limitations period, because a limitations period is one that is raised as an affirmative defense and may be waived.
This provision, where it says, "This Act does not apply"--
Justice Kennedy: Well--
Mr. Wolfman: --does not apply.
Justice Kennedy: --can you give me a reason for the Government's adopting (e), the 10 year... the 10 year bar, other than for stale claims or--
Mr. Wolfman: Oh, I don't know that there is one, but my point, again, is simply that the Government has no authority to proceed.
So, then we look... we look at that statute, and we say,
"What did the... what did the Congress do in 1996? "
What the Congress did in 1996 was amend that very statute by saying,
"Within the confines of this statute, you may now offset. "
Justice Breyer: Well--
Mr. Wolfman: But that's--
Justice Kennedy: --I understand that, but I'm just... I'm just saying, if you could give me an explanation, a characterization, a description, a statement of purpose that's other than the bar on stale claims, I think you'd have a stronger case.
But it seems to me just like a stale claims statute, so I go back and look for other limitations period, and I find it in 1091(a).
Mr. Wolfman: --You know, again, if... it is not... the purposes of the bar are not stated in any of the legislative materials, and we can assume that at least one of the principal purposes was to not allow the litigation, the contesting of stale claims, or to give the individuals repose, which is a purpose of time bars.
Justice Breyer: --You can call it any purpose you want, but there is an earlier word in 9... 1091(a), just what Justice Kennedy said.
The earlier word says limitations don't apply to the higher education debt.
And so, if this later statute, the words you're talking about, the words of 10 years> ["], the words that limit when you can do it, if those words, which are in subsection (e), are a "limitation", then I guess the earlier statute says they don't apply to the higher education debt.
And so, I don't see how you get out of that.
I mean... I mean, this is a rather harsh result.
I understand why you'd like to get out of it.
But I don't understand how we do get out of it.
Mr. Wolfman: Well, I think there are... there are... I... there are several answers.
And, if I might, first of all, if you must characterize what... and we are happy to do so... what is in the 1996 Act as either a time bar or a limitations period, this is clearly the former, because this... because the limitations periods in the law are ones which have to be raised by affirmative defense.
For instance, the Rules of Civil Procedure say limitations periods are raised by affirmative defense, and the case law is unanimous that they can be waived.
That is not what this provision does.
This provision restricts the authority, in the first instance, for the Government to bring the case.
The second thing I would say, though, Your Honor... and I think it does not matter, ultimately... that can be our principal submission here, and it is, but it does not matter... I think, ultimately, the nomenclature doesn't matter, because... again, because the Act restricts the authority of the Government to bring a case that is beyond the 10 year period.
And that is the statute that contains the express reference.
That is the--
Justice Kennedy: Of course, part of the problem is that 1091(a)(2), the "notwithstanding" clause, talks also specifically about offsets, which is what this is, I take it.
Mr. Wolfman: --No, I understand that, Your Honor.
Justice Kennedy: I mean, if it had said "no"--
Mr. Wolfman: --I understand that.
Justice Kennedy: --"# no limitations period", then I might... this specifically talks about an offset.
Mr. Wolfman: Well, that's right. The... and I... I don't think that undercuts our argument at all, because, after all, there's no question that, prior to 1996, there was offset authority in the Government to offset... to collect debt against other types of income, other than Social Security.
So, I don't think that undercuts our argument at all.
But let me, if I might, go back to your question one more time, because I think there's yet a third answer, which is... which is the chronological answer that... made in our briefs that, in 1991, the Congress could not have had the intent to get at Social Security benefits at all, because, of course, there... and it's... this point is conceded... the Government had no authority whatsoever to offset Social Security benefits.
If I might, in the... let me go--
Justice Souter: May I pursue that point for a second--
Mr. Wolfman: --Uh huh.
Justice Souter: --more?
I... it seems to me that you would have a much stronger argument on that point if, in 1996, the Act provided that, suddenly, Social Security benefits... some Social Security benefits would be... would be subject to administrative offset, but only those when the Government... imposed when the Government is trying to collect educational loans.
We would then have what seems to... would seem to me to be a really head to head conflict between the two statutes.
The trouble is that, in 1996, the extension of the administrative setoff authority covered Social Security benefits to be... for which there would be a setoff for any purpose... not just educational loans; for any purpose.
So that, in fact, it is possible for us to read the 1996 Act as having an effect... there's a 10 year limit, generally... at the same time that we read the earlier... I forget what the... '91, I guess it is--
Mr. Wolfman: The HETA law, yeah.
Justice Souter: --which says, with respect to educational loan collections, including by setoff, there's no limitation at all.
So, we can have both statutes without rendering either one of them nugatory.
And isn't that the preferred way to read statutes?
Mr. Wolfman: Well, but I... but I... with all respect, I think our interpretation certainly does not render HETA nugatory, because HETA would still override limitations periods for other forms of collection with respect to other types--
Justice Souter: But with--
Mr. Wolfman: --of debts.
Justice Souter: --with respect to Social Security setoffs, of course, it would.
Mr. Wolfman: Well, it... I'm not sure I understand that question.
Justice Souter: Social Security... Social Security said it would be... it would be a... it would... a flat head to head contradiction, no matter how you read it, on Social Security setoffs for educational loans.
Mr. Wolfman: Well--
Justice Souter: And if that's the only thing that the 1996 Act covered, we would say,
"Boy, there is just an absolute conflict here. "
"We can't have both statutes. "
But, in fact, we have both statutes most of the time.
We read the 1996 10 year limitation as covering everything except setoffs against Social Security for educational loans.
And, with respect to the educational loans, we give respect to the... to the earlier decision that there be no limitation at all.
You just have a weaker argument than you would have if the 1996 Act only covered this case.
Mr. Wolfman: --Well, that may be, but let me, again, if I... if I might, respond to that... to this... to this point, because I think it is true that the proportion of times under our argument that the 10 year bar would apply would... is greater under our position, but it is, nevertheless, true that HETA still applies to many situations, under our reading, and the 10-year bar applies to somewhat more.
But let me... I think there's another answer to your point, which is, it still does not undercut our basic submission that the Congress could not have formed this specific intent.
And it's very unlike the... the intent being to get to the Government the... the result it seeks here.
And the reason for that is... is, they could not have focused on this problem, because in... it wasn't for another 5 years that Social Security was even on the radar screen at all.
And this brings me back, I think, to Justice Breyer's--
Justice Stevens: Yes, but--
Mr. Wolfman: --initial question.
Justice Stevens: --may I ask this question?
That's a very... that's a very interesting statutory construction case, I must say, by the way.
But the... in 1996, when they made the offset available against Social Security payments, they didn't enact a 10 year statute of limitations; they changed subsection, I think, (b) to (d) and said the 10 year provision is retained.
And when the 10 year provision was first put in... I mean, when the exception for student loans was made, in 1991, you had a statute that had a 10 year period for everything except student loan recovery.
And it seems to me that if you look at the 1996 statute as saying,
"We're going to allow offsets against Social Security. "
under the same scheme that was enacted in 1991, because we had just amended the 10 year provision to preserve it... they preserved the 10 year provision... that they seem to me to be preserving it in a statute that made this distinction between student loans and all other offsets.
Mr. Wolfman: I--
Justice Stevens: --It isn't as though they enacted, for the first time, an authority to offset Social Security and, in that statute, said,
"And... but, by the way, there's a 10 year period of limitations here. "
Mr. Wolfman: --Well, that--
Justice Stevens: Rather, they amended the 1991 Act.
Mr. Wolfman: --that is correct. And I think that... but with a caveat, which I'll get to... but... I think that is correct, but it is a... it is a consequence of the situation that Congress found itself in, in 1996.
In other words, it already had a statute, the offset statute, which had a 10 year bar.
Justice Stevens: But it also had the exception for student loans.
It's... it was--
Mr. Wolfman: --Well--
Justice Stevens: --side by side with the rest of the 10 year bar.
Mr. Wolfman: --I'm not sure what you mean in that... I'm not sure what you mean by the exception for student loans.
Justice Stevens: Well, it's 1091(a).
Mr. Wolfman: --Well, 1091 was in a different statutory provision, in a different part of the code.
But I guess what I'm saying is, they--
Justice Stevens: But it was in the 1991 statute.
Mr. Wolfman: --Right.
It was in a 1991 statute that was a freestanding statute that dealt with Social Security benefits, generally.
Then what you had in 1996 was a focus on offsets, specifically, and on Social Security, specifically.
And the only point--
Chief Justice Roberts: But the '91 Act mentions offsets, specifically, as well.
Mr. Wolfman: --That's right.
And... but it mentions a lot of... many meanings of "collection", that is correct.
And... but I think it's not quite fair to say that they merely reenacted the 10 year bar.
We think that's sufficient for us to prevail.
But, you know, the Congress, in 1996, did a pretty comprehensive overall... overhaul of the Debt Collection Act.
It appears to have gone through every section.
It strengthened some of the notice provisions.
It focused specifically on Social Security and said that you can now offset them by making the express reference.
And then it turned to... what had been subsection (c) then became subsection (e).
It amended one of the paragraphs, but retained the paragraph that has the 10 year bar.
So, I think it's fair to say that Congress looked at all the sections carefully.
Justice Stevens: If you say that... let me just throw this thought out, so you can comment on it.
Mr. Wolfman: --Uh huh.
Justice Stevens: It seems to me that there is a reasonable basis for assuming Congress might have thought that student loans should not have a 10 year bar if you're going to collect from Social Security, because most Social Security payments won't accrue until many, many years... much more than 10 years after the student loan default.
Mr. Wolfman: Well, that... the Government certainly makes that submission in its brief, but, as we note in our reply brief, the statistics the Government cites don't really back that up.
I... but we do... we do acknowledge that, with respect to Social Security retirement benefits, there will be many people who are beyond the 10 year bar.
With respect to people who get other sorts of Social Security benefits, that's not clear at all, actually.
There are survivors--
Justice Stevens: No, but there is a--
Mr. Wolfman: --and there are disability--
Justice Stevens: --Retirement benefits are a pretty big part--
Mr. Wolfman: --Are a--
Justice Stevens: --of the whole package.
Mr. Wolfman: --larger number, that is true.
Justice Stevens: Yes.
Mr. Wolfman: But, again, I don't think that... there's no... there's no suggestion in... the problem... the ultimate problem with that point for the Government, Justice Stevens, is that it requires us to believe that Congress formed that intent in 1991, which is an impossibility, because--
Justice Stevens: No, I understand that.
Mr. Wolfman: --in 1991, Social Security benefits were just, sort of, off the table.
They weren't on the radar screen at all.
And that's the ultimate problem with the Government's--
Justice O'Connor: Mr.--
Mr. Wolfman: --theory there.
Justice O'Connor: --Wolfman, are there provisions by regulation in the Department of Education for discharge of debts like this on a showing of total and permanent disability?
Mr. Wolfman: There are, Your Honor.
Justice O'Connor: And your client doesn't qualify, or--
Mr. Wolfman: Well, the record is completely silent on that question.
I don't know the answer to that.
He was certainly disabled.
I will only point out that the standards for total and permanent disability under the Department of Education regs are much more stringent than those for Social Security, because that only requires a 12 month period of disability.
But I don't know the answer as to him.
I'm... I do want to get to one other point before I sit down, and... which is to address one of the Government's arguments... is that to... to get around a... the problem that the DCIA reenacted the 10 year bar, the Government relies on the 1991 Education Act, arguing that it wipes away any time bar, regardless of when the time bar was enacted, and no matter what type of collection is at issue.
But, as we note in our reply brief extensively, those "notwithstanding" clauses are not as all powerful as the Government suggests they are.
And what the case law... the lower court case law suggests is that you need to look, as we have done in our submission, at the legislative history and the legislative motive surrounding both Acts, the previous Act and the subsequent Act.
And, here, what you have... and I don't want to beat a dead horse, but I will repeat once again that the problem here is... for the Government... is that we have this very powerful anti attachment provision with its express reference requirement.
And the only place in these statutory materials where the express reference occurs is in a... the very Act that includes the 10 year bar.
And to accept the Government's argument, you would have to accept the notion that the... an express reference in an act can go beyond the authority that's granted by that very act.
Justice Breyer: No, it... I mean, you... it's... it probably comes up a lot.
You have... you have the earlier act that imposes... suppose you have some... Endangered Species Act and... at an earlier time... and it says all provisions of a certain kind will have this effect in respect to endangered species.
And then you have some laters act... later acts.
And, in those later acts, there are certain things about how to treat certain animals and so forth.
And the question would be,
"Well, does that earlier thing, telling you how to treat an endangered species, apply now to the animals in this later act insofar as they're endangered? "
And the answer would be, "Of course it does"--
Mr. Wolfman: Yes.
Justice Breyer: --unless there's some special reason--
Mr. Wolfman: Right.
Justice Breyer: --for thinking that it doesn't.
And so, what's the special reason--
Mr. Wolfman: Well--
Justice Breyer: --here? You have an earlier act that says, when you see those words, 10 year limitations> ["], forget 'em where student loans in effect.
Now we have a later act, and it has the word 10 year limitations> ["], and you're giving some reasons why--
Mr. Wolfman: --Right.
Justice Breyer: --it is special and--
Mr. Wolfman: Right.
Justice Breyer: --so forth.
Mr. Wolfman: And I--
Justice Breyer: --I don't know--
Mr. Wolfman: --but I--
Justice Breyer: --if they're--
Mr. Wolfman: --but I think that that's--
Justice Breyer: --strong enough--
Mr. Wolfman: --that's the nub of the case--
Justice Breyer: --Uh huh.
Yes, that is the nub.
Mr. Wolfman: --the special reasons.
But... but I... but I... let me... let me... let me answer your question--
Justice Breyer: But, I mean, they don't have that big burden to show.
They have to just--
Mr. Wolfman: --I--
Justice Breyer: --show it's normal.
Mr. Wolfman: --That's where I--
Justice Breyer: And you have to show it's special.
Mr. Wolfman: --I think, on these legislative materials, they have quite a burden.
And let me explain why.
Your... the... Justice Breyer, the hypothetical you posit is one with which I can agree.
We are not saying... I don't want to be mistaken... that... we are not saying that previous legislation can't have effect on future events, or even future legislation.
We're not saying that all.
But the nub of our argument is this express reference requirement, and I think it's... it seems very, very odd to us that when you have a statute that has an... where the express reference appears, and that has a 10 year bar on the authority--
Justice Stevens: But, Mr.--
Mr. Wolfman: --to collect--
Justice Stevens: --Wolfman, couldn't you say the question could be phrased in this way?
Do we view the notwithstanding language in 1091(a) as enacted in 1091 and governing the future, or do we view the 1996 amendment as, in effect, an amendment to that stat which... which reenacted the provisions that were already there?
And if it's a reenactment in 1996, then it's just an exception from the 10 year bar.
Mr. Wolfman: --Right.
I think that... that is a fair characterization of one our arguments here--
Justice Stevens: Yes.
Mr. Wolfman: --which... one of our arguments here is, given the various indicia of intent, both in '91 and '96, that the '96 Act, with respect to a small sliver of collections, is effectively an amendment of the '91 Act.
However, that is not our only, or even our principal submission.
Our principal submission has to do with the powerful anti attachment--
Justice Stevens: Right.
Mr. Wolfman: --provision.
Justice Stevens: I understand.
Mr. Wolfman: Okay?
And, again, the Government's position... and I will rest after this, because I've repeated this already... but the... the Government's position is, in effect, that you can use the anti attachment position in the express reference requirement in a statute to allow authority beyond that very statute.
And we submit that that is... that is not permissible under section 407.
Unless the Court has further questions, I'll reserve the rest of my time.
Argument of Lisa Schiavo Blatt
Chief Justice Roberts: Thank you, Mr. Wolfman. Ms. Blatt.
Ms Blatt: Thank you, Mr. Chief Justice, and may it please the Court--
In sweeping and unqualified language, the Higher Education Act provides that, notwithstanding any other provision of law, no limitations as to time shall apply to the collection of student loan debt by offset.
Therefore, notwithstanding the general 10 year limit that applies to the offset of all Federal payments, including Social Security payments, no time limit applies.
Justice Stevens: But it didn't include Social Security payments when it was enacted.
Ms Blatt: That's right.
In 1982, Congress authorized--
Justice Stevens: Or 1991.
Ms Blatt: --Right.
In 1982, Federal payments were subject to offsets such as Federal grants to contracts or pension.
And, in 1991, Congress passed a law that said there's no... going to be no time limit for the Government to collect student loan debt by offset.
Therefore, there has always been a student loan exception to the Government's ability to offset for only up to 10 years.
So, we can't offset Federal pension payments or contract payments beyond 10 years unless it's for student loans.
Justice Kennedy: Well, but then... but then, in... you know, you know what's coming.
You... the provision you rely on is 3116, and it's stuck into the middle of this... of a provision which requires written notice, opportunity to inspect records, and so forth.
All those apply.
But you have to say that (e) doesn't apply.
Ms Blatt: Well, (e) is a limitations period, and it is a provision of law, and the Higher Education Act says, notwithstanding any other provision of law, there's no time limit for offsetting... for collection by offset when it's to collect student loan debt.
What happened in 1996 is, Congress authorized Social Security benefits as another source of Federal payment.
But it's critical to understand that Congress left completely undisturbed and intact that preexisting 10 year limit and the pre existing student loan exception--
Justice Ginsburg: But Mr. Wolfman tells us, Ms. Blatt, that this clause is not quite as sweeping as you suggest, the clause in the 1991 Act, and points specifically to provisions that say,
"no other provision of law enacted before, on, or after. "
The picture we're given of the 1991 Act is that up until 1991, whatever exists up until 1991, there's no time limitation, but that this 1991 statute does not speak to subsequently enacted statutes.
Ms Blatt: --Yes, well, it is unqualified, on its face, Justice Ginsburg.
It doesn't say
"notwithstanding any other provision of existing law. "
It says "any law".
And it would be a rather bizarre and novel statute if Congress had to keep amending every time Congress redesignated a limitation provision, which is all that's happened here.
Every time Congress had a limitation provision that changed from subsection (e) to (a), or was given a different section number, Congress would have to go back and say... I guess, reenact the Higher Education Act every time it amended the statute of limitations.
But, even if you think that it only applied to preexisting limitations period, this 10 year limit predated the Higher Education Act.
It was passed in 1982, and had... and has appeared in identical language since 1983.
Nothing happened in 1996 to statutes of limitations.
All that happened was that Congress, in essence, put Social Security benefits on par, equal footing, with all other Federal payments.
And let me just say, imposing a 10 year limit would largely nullify Social Security offsets to collect student loan debt.
Justice Ginsburg: The point that Justice Stevens made--
Ms Blatt: Yes.
Justice Ginsburg: --before.
Ms Blatt: Ninety percent of all student loan debtors who default do so before age 55.
And, therefore, a 10 year time limit will have expired before the debtor reaches full retirement age, at age 65.
And it's relevant not so much what Congress what was thinking in '91, but it's relevant for what Congress was thinking in 1996.
In 1996, Congress made Social Security benefits subject to offset.
And it's completely rational to think that Congress of course understood there would be a general 10 year limit that's always been applied to offsets of all Federal payments, including the Federal contract payments or pension payments, and now Social Security payments, but, yes, there's another provision of the U.S. code that contains an express and, we think, extraordinary exception.
It says time limits are intolerable when it comes to the collection of student loan debt.
Now, at the same time, Social Security recipients are protected from any undue burden.
The... if you are disabled under the Department's regulations, you can obtain a complete discharge, a total walk away from the debt forever, if you have a disability that prevents you from earning income.
You also... the amount of the Social Security offset is limited to the lesser of 15 percent of the benefit payment or the amount by which the benefit payment exceeds $750.
And any debtor can enter into a repayment agreement that will take their total--
Chief Justice Roberts: Those are... those are regulatory provisions, right?
Ms Blatt: --The caps, Mr. Chief Justice, are in the statute, and further limited by the regulations.
But, actually, the repayment agreements are mandated provisions under the Higher Education Act.
It mandates the Secretary of Education to allow debtors to enter in repayment agreements that are contingent on their income, and that will allow them to repay their debt under reasonable and affordable terms.
That's also in the statute.
Justice Breyer: So, is the statute... I saw something here, that a person who's going to get this offset, and he has Social Security, you exempt $9,000 of the Social Security, and then you limit it to 15 percent of the remainder or whatever is reasonable, whichever is less.
Ms Blatt: It's the lesser of... it's the lesser of the 15 percent or the amount by which the benefit payment exceeds 750.
So, in this case, when the original Social Security check was, I think, like, $874, 15 percent would have been a higher number.
You have to leave the recipient with 750, so I think only $94 was taken out.
And I may have my math a little off.
But you... the... you give the recipient the benefit.
Now, the only thing that's in the regulations, Mr. Chief Justice, are the disability, that that is just a... it's a walkaway on the loan.
Even if you win the lottery the next day, if you can show that you can't work because of a disability, the Secretary of Education will discharge your loan.
Now, the principal argument on the other side is section 207 of the Social Security Act.
Now, that statute requires an explicit reference before Social Security benefits can be subject to a legal process.
But it doesn't require an explicit reference when the only question is the statute of limitations that are applicable to a legal process that is already otherwise expressly authorized.
The Debt Collection Act is the actual statute that authorizes the offset of Social Security benefits.
The Higher Education Act just lifts limitations periods when there's another statute that establishes a collection mechanism.
And the Debt Collection Act contains the express reference.
It provides, in 3716, that,
"We're making our clear statement, we want Social Security benefits to be subject to offset. "
And, like I said, it just... it plugged the Social Security system into this preexisting--
Justice Stevens: But it is... it is true that the 1996 statute, which is the first time the express reference appears, does contain the 10 year statute by the indirect reference, and does not expressly refer to the... cite the 1091(a).
Ms Blatt: --That's right.
It makes the express reference to 207, and it has this general limitations period that applies to all offsets.
But, Justice Stevens, just--
Justice Kennedy: And it says... and it says "offsets under this section".
Ms Blatt: --That's right. And that takes you down to the subsection (e), which imposes a 10 year limit.
But just as today Congress certainly is free to say,
"From now on, Social Security benefits and all offsets will be subject to an 11 year limitations period. "
it doesn't have to expressly reference 207 to amend the Debt Collection Act.
The Debt Collection Act is what's being, in effect, amended or an exception.
And the Debt Collection Act doesn't contain its own express reference requirement before it can be amended.
Congress didn't say, "We're forever binding ourselves", or,
"We want some different canon of interpretation here. "
And so, you have a very extraordinary provision in the Higher Education Act that says,
"Notwithstanding any other provision of law, there's not going to be a time limit to offset in order to collect student loan-- "
Justice Breyer: But... yeah, I think he's... one argument that they're emphasizing, anyway, is that... you look at the Debt Collection Act, and suppose it had said the following,
"Section 207 is amended, or changed, as follows. "
"We refer specially now... we can collect, through offset, but only for 10 years. "
"I mean, only to claims that are more than 10 years old. "
"So, we are changing what 207 says for debts over 10 year... under 10 years old, and we can offset those. "
Now, suppose it had said that.
Ms Blatt: --It would still... the express reference would be completely overtaken, because it says the 207> ["].
It would authorize offset for--
Justice Breyer: And you'd say it's the same.
Ms Blatt: --For up to 10 years.
Justice Breyer: All right. If that's the same, let's imagine this statute.
The statute says,
"We bestow upon the Social Security agency a very limited power. "
And it says,
"This is the limited power. "
"The Social Security Agency may, despite 207, levy offsets on under 10 year old debts. "
That's what they say, right in the Act.
Ms Blatt: Right.
It would... the--
Justice Breyer: And then, indeed, the whole point of it... it's entitled "Limited Offset Ability", parenthesis...
"Limited Offset Ability, Extending Only to Debts of Less than Ten Years. "
That's the title of the Act, and then it says just what I say, repeating that.
Ms Blatt: --Yes. Well, our position is that the Social Security Act only requires an express reference to create authorization to offset.
Justice Breyer: But you're not going to treat that--
Ms Blatt: And--
Justice Breyer: --one the same.
You see, what they're saying here is... they want to say that what I've just said is what Congress wrote in this Act.
Ms Blatt: --Right.
Justice Breyer: --I'm making it harder and harder for you to accept that saying--
Ms Blatt: Yes.
Justice Breyer: --automatically.
Ms Blatt: --fundamental position--
Justice Breyer: Right.
Ms Blatt: --I'll be clear on this... is that the Higher Education Act applies unless it's been repealed.
And there's just nothing in the Higher Education Act that comes close to repealing... in, excuse me, the Debt Collection Act... that comes close to repealing the Higher Education Act, because it doesn't address the subject of student loans.
It just speaks to the ability to offset Social Security benefits, as well as all other Federal payments that have been subject to offset.
Justice Stevens: Ms. Blatt, can I ask... there's no discussion... legislative history in the briefs that I... because I... that I recall.
Is it true that the people voting on the bill in 1996 had nothing but the amendment before them?
Did they have a committee report on it explaining that it still applied to the... that the... that the 1091(a) would still be in effect?
Ms Blatt: No, I know of no statement to that effect.
But I know of no statement... any discussion about limitations period.
There's no discussion of the 10 year limit either.
Justice Stevens: Because it seems to me that, conceivably, a legislator looking at the bill all by itself, not getting out the earlier provisions of the code, might well think,
"Well, this includes a 10 year limit. "
Ms Blatt: Maybe they did, maybe they didn't.
Maybe the knew that a court would actually apply the U.S. code, as written--
Justice Stevens: Yes.
Ms Blatt: --and just because it... the limitation period was in one section... but, now, here's where I think the policy does come into play.
A legislature would think that a 10 year limit would never come in to offset Social Security benefits on student loan, except in a rare case of an old debtor who... and also defaults close in time to age 65.
And, like I said, 90 percent of all the student loan defaults are by debtors who are under age 55, and over... about 83 or 84 percent of all Social Security payments are under the retirement system, not the disability system.
And if a person is disabled, there's no reason to think that they can't get a discharge of that loan.
So, all we're talking about is basically rendering a dead letter Social Security offsets to collect student loan debt, if Petitioner's position were to prevail.
Justice Scalia: Why can he get a discharge if he's disabled?
Ms Blatt: You can get a discharge of your loan if you have a disability of indefinite duration that prevents you from working.
The rationale is, sort of, a changed circumstances rationale.
If you took out a loan, you signed a promissory note, you intend to pay it back.
But if you later become disabled, and that disability is going to prevent you from ever working, they'll discharge it.
Now, about 30 percent of all people who do apply for this disability discharge do get it, and about 80 percent get a conditional discharge, what gives them... it gives them a 3 year grace period.
And the only difference between... I mean, there are some small differences, but the main difference between a Social Security disability determination and an Education Department disability determination is the Department of Education wants you to be disabled of an indefinite duration, and not just 12 months, because it's a complete and total walkaway from the loan.
And Social Security will actually do a lookback after 12 months.
But Education will never go back and ask for the money.
Once they've discharged it, it's a permanent discharge.
Justice Stevens: Ms. Blatt, it... was this statute... I'm just really kind of curious that something this important, we're first putting this burden on Social Security... it's a fairly important change.
Was this part of one of these omnibus bills that covered 99 different subjects at once?
Ms Blatt: Yes.
Justice Stevens: That--
Ms Blatt: --I remember trying to find it on Westlaw.
It's, like, 3,000 pages.
Justice Stevens: --Yes.
Ms Blatt: --huge. And it covers many, many different subjects.
Justice Stevens: And they did not have a separate committee proceeding on each separate part of that monster bill--
Ms Blatt: That--
Justice Stevens: --as I remember.
Ms Blatt: --That, I don't recall.
But I can say the overall thrust... and it's in their statement of purpose... was to improve the Government's debt collection--
Justice Stevens: Yes.
Ms Blatt: --efforts.
And what it did was, for the first time... and this was a very significant development... establish a centralized offset.
Before 1996, there was no ability to cross check a debt from one agency to a payment to--
Justice Stevens: Right.
Ms Blatt: --another agency, such that one Department had no idea what another Department was doing.
And now it is a massive program involving over $1 trillion of Federal payables, $255 billion of certified debt, and 33 billion of that is education loan debt.
And so, that... this was to... an enormous undertaking to start that, in 1996.
And one of the things that Congress did in setting up this massive program was, made Social Security benefits part of the offset program.
There's about $480 or $490 billion in Social Security benefits, so... which... it was a huge source of revenue, although Congress obviously limited it substantially with the--
And if there are no further questions, we would ask that the Court of Appeals judgment be affirmed.
Rebuttal of Brian Wolfman
Chief Justice Roberts: Thank you, Ms. Blatt.
Mr. Wolfman, you have three and a half minutes remaining.
Mr. Wolfman: Thank you, Mr. Chief Justice.
I want to address, first, a point that the Government makes, that... and it's about Section 207 of the Social Security Act, the antiattachment provision.
Opposing counsel says that it doesn't really matter that the 10 year bar was not addressed in 1996, because all that's necessary under the express reference provision is to refer to the law, in general, that it doesn't apply to limitations periods.
But that simply cannot be the case here, because, again, this statute that we are talking about, the Debt Collection Improvement Act, and the Debt Collection Act before, is a bar on the authority of the Government to collect after 10 years.
And let me pick up on the language that Justice Kennedy pointed to from the Debt Collection Act.
It says, in the very subsection in which Social Security first was put on the radar screen, was first dealt with, (c)(3)(a)(i)... it says that you can now go after Social Security benefits, because they are subject to offset under this section, meaning 3716.
Then, if you turn to another subsection of that section, it says... and this is the 10 year bar... this section, quote, 10 years.
Now, I don't see any reason to say that 207, the requirement of an express reference, is, sort of, a halfway requirement.
In other words,
"You only have to refer to Social Security benefits. "
"We don't care what the extent of that authority is in the very section that you use that express reference. "
Here, the entire authority is circumscribed by the 10 year bar.
That is our essential submission.
I have one other point, which is that the... because there was a number of questions on it.
We think it doesn't go to the congressional intent here, but I do want to clarify.
There is a substantial difference between being disabled and being eligible to get the discharge.
Discharge requires permanent disability... forever, you cannot... you are not capable of working.
In Social Security law, you have to be incapable of working for a period of 12 months. Thank you.
Chief Justice Roberts: Thank you, Counsel. The case is submitted.
Argument of Speaker
Ms Blatt: Justice O’Connor has the opinion in No. 04-881, Lockhart versus United States.
Argument of Justice O’connor
Mr. O’connor: This case comes to us on writ of certiorari to the Court of Appeals for the 9th Circuit.
It concerns the Government’s effort to withhold part of the petitioner’s Social Security benefits to offset his debt on federally reinsured student loans that are more than ten years overdue.
Whether the Government can do this is determined by a rather complicated interplay of four statutes.
First, we have two statutes about time limits.
The Debt Collection Act lets the Government collect debts by administrative offsets, subject to a general ten-year statute of limitations; but the Higher Education Technical Amendments of 1991 eliminate time limits on suits to collect student loans.
Next, we have two statutes about the Government’s ability to subject Social Security benefits to offset.
Social Security benefits are generally exempt from attachment or other legal process.
The Social Security Act purports to protect this anti-attachment rule with an express reference provision.
The statute says no other provision of law may be construed to modify this section except to the extent that it does so by express reference.
But the Debt Collection Improvement Act of 1996 subjects Social Security benefits to administrative offset, making express reference to the Social Security Act.
Now, petitioner here argued that the Debt Collection Act’s ten-year statute of limitations controlled, so the Government could not offset his Social Security benefits.
The 9th Circuit disagreed and held that the Higher Education Technical Amendments had eliminated that time limit as to student loans.
In an opinion filed today with the Clerk of the Court, we affirm the 9th Circuit’s judgment.
We hold that the 1991 and 1996 statutes make Social Security benefits subject to offset, providing exactly the sort of express reference the Social Security Act says is necessary to supersede the anti-attachment provision and remove the ten-year limit that we otherwise would say barred the Government’s action.
Debt collection by Social-Security offset was not authorized until 1996, five years after the abrogation of time limits; but the plain meaning of the Higher Education Technical Amendments must be given effect, even though Congress may not have foreseen all of its consequences.
We do not decide whether the Social Security Act’s express reference provision is valid.
Justice Scalia has filed a concurring opinion.