Opinion
Case No. C2-O1-867
September 30, 2002
OPINION AND ORDER
On September 11, 2001, pro se plaintiff David Perkins filed suit against the United States Department of Education (the "DOE"). On that same date this Court received and granted Mr. Perkins' application to proceed in forma pauperis. Mr. Perkins seeks an injunction prohibiting the DOE from offsetting his federal income tax refunds in payment of his defaulted student loan. See 31 U.S.C. § 3720A. On February 27, 2002, the DOE filed a motion for judgment on the pleadings pursuant to FED. R. Civ. P. 12(c). On March 21, 2002, Mr. Perkins filed a response to the DOE's motion and moved for appointment of counsel. For the following reasons, the DOE's motion for judgment on the pleadings will be granted in part and denied in part.
I.
A motion for judgment on the pleadings attacks the sufficiency of the pleadings and is evaluated under the same standard as a motion to dismiss. See Amersbach v. City of Cleveland, 598 F.2d 1033, 1038 (6th Cir. 1979). In ruling on such motion, the Court must accept as true all well-pleaded material allegations from the pleadings of the opposing party, and the motion may be granted only if the moving party is nevertheless clearly entitled to judgment. See Southern Ohio Bank v. Merrill Lynch. Pierce, Fenner Smith Inc., 479 F.2d 478, 480 (6th Cir. 1973). Pro se complaints are to be construed liberally in favor of the pro se party. See Haines v. Kerner, 404 U.S. 519, 520-21 (1972). It is with these standards in mind that the motion for judgment on the pleadings must be decided.
II.
The facts of the case may be summarized as follows. On June 17, 1980, Mr. Perkins applied for a loan from BancOhio National Bank in the amount of $2,500. This Joan was for the purpose of attending the Ohio lnstitute of Technology. Mr. Perkins' acquaintance, Betty Monahan (or Manahan) co-signed the loan. At some point, Bancohio was sold to National City Bank. Mr. Perkins never made payments on the loan to either bank. In his complaint, he asserts that the loan was not guaranteed by any governmental agency because he "did not qualify for a government guarantee (sic) loan."
The DOE asserts that Mr. Perkins' loan was subject to the Federal Family Education Loan Program. See 20 U.S.C. § 1071 et. seq. Through a reimbursement agreement between the OSLC and the DOE, the OSLC guaranteed such loans and the DOE served as a reinsurer of the loan.
According to documents submitted by Mr. Perkins in response to the DOE's motion, when he defaulted on his loan payments, the OSLC took assignment of the loan. On July 12, 1985, the OSLC obtained a state court judgment against him for the loan amount plus interest, The DOE claims that it is now the assignee of the loan, although that fact is not disclosed in the complaint. It can be inferred from the complaint, however, that the DOE submitted Mr. Perkins' case to the federal Treasury Offset Program and requested the Secretary of the Treasury to offset Mr. Perkins' debt by withholding Mr. Perkins' federal income tax refunds. See 31 U.S.C. § 3720A(a).
Mr. Perkins seeks an injunction prohibiting the DOE from offsetting his federal income tax refunds in payment of his student loan. See 31 U.S.C. § 3720A. Mr. Perkins also asks this Court to find that he is no longer obligated on his student loan. He seeks recovery of the $890 that the Internal Revenue Service (the "IRS") has offset from his federal income tax refund, $50,000 for lost wages, court costs, attorneys' fees and all other costs associated with this action, $100,000 for damages for false information that the DOE allegedly gave to one of his creditors, and permission to file his federal income tax return for the year 2000. The motion for judgment on the pleadings will be decided largely on these facts, although not all of them are evident from the pleadings.
III.
The DOE asks this Court to dismiss Mr. Perkins' complaint for lack of jurisdiction over the subject matter and for failure to state a claim upon which relief can be granted. In his reply to the DOE's motion, Mr. Perkins does not address the issue of this Court's subject matter jurisdiction. However, Mr. Perkins asserts that he does, in fact, have a claim upon which relief can be granted in that he claims he was never party to a federal student loan and that the loan was already paid in full by Ms. Monahan.
The Court will first address the issue of whether it has subject matter jurisdiction over a claim for injunctive relief against the DOE. Because this is a jurisdictional issue, the only facts relevant to the Court's determination are those pleaded in the complaint — namely, that the DOE is involved in collection efforts against Mr. Perkins. This issue does not require the Court to consider the significance of Mr. Perkins' claim that his student loan was not federally guaranteed or that it was already repaid.
As a sovereign, suits against the United States or its agencies are only permitted to the extent that the federal government has waived its sovereign immunity. See United States v. Mitchell, 463 U S. 206, 212 (1983). Section 432(a)(2) of the Higher Education Act of 1965. 20 U.S.C. § 1082 (a)(2), waives the federal government's sovereign immunity by allowing the Secretary of Education to "sue and be sued" with respect to the performance of duties under the Act. 20 U.S.C. § 1082 (a)(2). however, § 1082(a)(2) also prohibits injunctions against the secretary of Education ("no . . . injunction . . . shall be issucd against the Secrctary. . . ,"). Thus, the waiver of sovereign immunity found in the Act does not extend to the type of injunctive relief sought by Mr. Perkins.
In Thomas v. Bennett, 856 F.2d 1165, 1166 (8th Cir. 1988), the Eighth Circuit Court of Appeals addressed a challenge to the Secretary of Education's authority to collect a defaulted federally . . . insured loan through offset of the borrower's federal income tax refunds. There, the plaintiff requested injunctive relief, declaratory relief, and any other relief as deemed equitable. The court held that 20 U.S.C. § 1082 (a)(2) prohibits injunctive relief against the Secretary of Education. See Thomas, 856 F.2d at 1168. However, the court also explained that since the plaintiff requested declaratory relief and any other relief as deemed equitable, it was proper for the court to retain jurisdiction over these claims. See id.
Following the Act and the Thomas decision, this Court concludes that it lacks subject matter jurisdiction over Mr. Perkins' claim for an injunction prohibiting the DOE from offsetting his federal income tax refunds in payment of his defaulted student loan.
Mr. Perkins also seeks recovery of $890 that has been withheld from his federal income tax refund. There is some dispute as to the amount that has been withheld. The DOE claims that only $641.84 has been withheld. Regardless of the amount, the appropriate defendant has not been named in Mr. Perkins' complaint. See 26 U.S.C. § 7422 (f); see also White v. Comm'r of Internal Revenue, 537 F. Supp. 679, 682 (D.Colo. 1982). This Court can only hear a claim for recovery of federal income tax alleged to have been wrongfully assessed or collected if the claim names the United States as the defendant, the plaintiff has filed a timely refund claim with the IRS, and the plaintiff has prepaid any deficiency assessments for the year in question. See White, 537 F. Supp. at 682; See also 26 U.S.C. § 7422 (a), (f). Therefore, since Mr. Perkins has named only the DOE as a defendant in this suit and does not plead that he filed a timely refund claim, his claim for recovery of the amount withheld from his federal income tax refund will be dismissed. See Martucci v. Mayer, 210 F.2d 259, 260 (3rd Cir. 1954).
Mr. Perkins' claim for recovery of $50,000 for lost wages, court costs, attorneys' fees and all other costs associated with this action again raises the issue of the sovereign immunity of the United States. As a department of the federal government, the DOE enjoys sovereign immunity unless such immunity has been waived. See Mitchell, 463 U.S. at 212. Although, as noted above, the DOE has conscntcd to be sued under 20 U.S.C. § 1082(a), that statute also states that 28 U.S.C. § 2679 applies to suits against the DOE. 28 U.S.C. § 2679 is part of the Federal Tort Claims Act, which waives the sovereign immunity of the United States for tort claims subject to the exceptions in 28 U.S.C. § 2680. See 28 U.S.C. §§ 2674, 2680. Further, to assert a claim under the FTCA, a plaintiff must exhaust his administrative remedies prior to filing suit. See 28 U.S.C. § 2675(a). Mr. Perkins claims to have made an attempt to contact the DOE by telephone. However, there is no indication that Mr. Perkins ever filed an administrative claim with the DOE. The filing of such a claim is a jurisdictional prerequisite. See id. Since Mr. Perkins has not exhausted his administrative remedies, this Court has no jurisdiction over any tort claim he has pleaded.
Mr. Perkins' claim for damages as a result of false information allegedly given by the DOE to one of Mr. Perkins' creditors also raises the issue of sovereign immunity. With respect to that claim, even if Mr. Perkins had exhausted his administrative remedies, this Court would still lack jurisdiction because the United States has not waived its sovereign immunity for claims sounding in misrepresentation, deceit, or slander. See 28 U.S.C. § 2680 (h); see also Lloyd v. Cessna Aircraft Co., 429 F. Supp. 181, 182 (E.D. Tenn. 1977).
Finally, Mr. Perkins seeks this Court's permission to file his federal income tax return for the year 2000. This issue is not a matter for this Court but rather for the IRS. See 26 U.S.C. § 6072, 6081, 6501. Therefore, this claim will also be dismissed.
To this point, the Court has addressed all of the claims that are discussed in the motion for judgment on the pleadings, and has found the motion to be meritorious with respect to each of those claims. That does not necessarily require dismissal of the entire case, however, if the complaint pleads additional claims not addressed by the motion.
As noted above, the Court is obliged to give a liberal construction to Mr. Perkins' pro se complaint. The complaint, fairly read, asserts facts that, if true, would justify a declaratory judgment that Mr. Perkins owes no money to the DOE. For example, he asserts that his loan was never federally insured, and he states that the co-signer repaid it. Although the DOE submitted a document with its motion for judgment on the pleadings, the Court cannot consider mattcrs outside the pleadings in ruling on a 12(c) motion. Further, the document is unsworn, so that the Court cannot convert the motion into a motion for summary judgment. The waiver of sovereign immunity contained in 20 U.S.C. § 1082 (a) allows the Court to entertain requests for declaratory relief in student loan cases. See 856 F.2d at 11 b8. Uonsequently, although all of Mr. Perkins' claims for monetary damages and injunctive relief are subject to dismissal, his claim for declaratory relief concerning his continued obligation on the loan survives.
IV.
Mr. Perkins has requested that the Court appoint him counsel. The Court can request an attorney to represent anin forma pauperis litigant, but there is no right to appointed counsel under 28 U.S.C. § 1915 (a)(1), and the issues remaining in this case are not so complex that counsel is required. The motion for appointment of counsel (flle doc. #16) is therefore DENIED.
V.
Based upon the foregoing, the DOE's motion for judgment on the pleadings (file doc. #14) is GRANTED as to Mr. Perkins' claim for injunctive relief, recovery of the amount of money withheld from his federal income tax refund, lost wages and related costs, misrepresentation, and his request for permission to file his federal income tax return for the year 2000. All of those claims are DISMISSED WITHOUT PREJUDICE for lack of subject matter jurisdiction. However, to the extent that the DOE's motion for judgment on the pleadings is directed to Mr. Perkins' claim that he was never a party to a federal loan and that the loan debt has been paid in full and that, as a result, he is entitled to a declaration that the DOE has no claim against him, the motion is DENTED. The DOE may, if it wishes, address those claims in a timely motion for summary judgment.