Pauline borrowed funds from the federal government to attend flight school, where she learned to be a pilot. After graduation, Pauline started a business she called Otto Airshows with a helicopter decorated as “Otto the Clown.”

When the government tried to collect the amount of Pauline’s unpaid loan from the assets of Otto Airshows, she formed Prop Aviation, Inc., and leased the Otto equipment to Prop. She then filed a Chapter 13 bankruptcy petition without noting the unpaid loan and the equipment lease.

Is the court likely to allow Pauline’s petition to proceed?

No. The court is likely to ______________ the petition due to ______________. The Bankruptcy Code imposes the requirement of good faith at the time of the filing of a petition and the time of the filing of a repayment plan under Chapter 13. Pauline did not include all of her assets and liabilities in her petition. For this reason, even if the petition was allowed to proceed, and a discharge was granted, the student loan debt would not be included. There would have been no finding that payment of the debt constituted ______________.