Padraic Gillespie, a student at the University of North Texas, borrowed $12,500 from Bank One, N.A., under its Education One loan program and signed a note for the amount. A few months later, the Education One “student loans listed on Schedule 2” were sold to National Collegiate Student Loan Trust 2005–3. When Gillespie failed to make payments on his loan, the Trust filed a suit in a Texas state court to recover the balance. No document admitted into evidence at the trial showed that Gillespie’s note was included with the loans sold to the Trust. Thus, Gillespie argued, the Trust had failed to show that it was a holder in due course of the note, that it had the right to recover on the note, or that there was a contract between Gillespie and the Trust with respect to the note. Ultimately, a take-nothing judgment was rendered against the Trust—that is, the Trust received no damages or other relief. [Gillespie v. National Collegiate Student Loan Trust 2005–3, 2017 WL 2806780 (Tex.App.—Ft. Worth 2017)] (See Holder in Due Course.)

(a) Analyze the Trust’s decision to pursue this action against Gillespie, using the IDDR approach.

(b) What might the Trust have done to avoid or improve the result in this case? Explain.