The Servicemembers Civil Relief Act (SCRA) Legal Issues and Military Service PRESENTED BY:

1. The Servicemembers Civil Relief Act (SCRA) Legal Issues and Military Service PRESENTED BY: Captain Daniel Papajcik Trial Counsel / Administrative Law Attorney U.S. Military Entrance Processing Command Margaret Thomas (Captain, USA-IRR) Office of Illinois Attorney General Lisa Madigan Asst. Bureau Chief, Veterans Rights Bureau John F. Costello, Jr. Veterans Legal Support Center & Clinic, The John Marshall Law School Veterans’ Rights Project, Legal Assistance Foundation June 18, 2008 SPONSORED BY: Chicago Volunteer Legal Services (CVLS)

2. Objectives of Presentation • Overview of Statutory Benefits and Protections available to Servicemembers (SMs) and their families under the Servicemembers Civil Relief Act (SCRA) and Illinois law; and • Recruit you to help…

3. Outline of Presentation • OVERVIEW of SCRA benefits and protections • FOCUS on 50 U.S.C. App. §§ 521 and 522 (stay of proceedings) • FORMS to be used in support of application for stay • HOW TO CONTACT servicemember (SM) • WAR STORIES - discussion of specific situations • DISCUSSION of Circuit Court of Cook County and CVLS initiative

4. SCRA Overview • SCRA provides various legal and financial protections to qualified “servicemember(s),” as defined in 50 U.S.C. App. § 511 • Liberal Construction “Protect those who have been obliged to drop their own affairs to take up the burdens of the nation.” Boone v. Lightner, 319 U.S. 561, 575 (1943) • Used as Shield and Not as Sword “Although the Act should be read liberally and afford generous protection to the Service member, the protection does have its limits.” Le Maistre v. Leffers, 333 U.S. 1, 6 (1948)

5. SCRA Overview Codified at 50 U.S.C. App. §§ 501-596 • Title I - General Provisions (§§511-519) • Persons protected • Non-discrimination provision - §518 • Title II - General Relief (§§521-527) • Default judgments and stays - §§521, 522, 524, 525 • Statutes of Limitation - §526 • Maximum rate of interest - §527 • Title III (§§531-538) • Majorsubstantive protections against evictions, termination of installment contracts, foreclosure on mortgages and termination of leases by lessees, protection to dependants • Title IV - Life Insurance (§§541-549) • Title V - Taxes and Public Lands (§§561-571) • Title VI - Administrative Remedies (§§581-583) • Title VII - Further Relief (§§591-596)

6. SCRA Overview • WHAT: • Suspend Statutes of Limitation • Cap Interest Rates at 6% • Permit Lease Terminations • Protections from Eviction and Mortgage Foreclosure • Stay of Proceedings • Protections from Default Judgments

7. SCRA Overview • WHO: • Active Duty Military - YES • Army, Navy, Air Force, Marines, Coast Guard • Reserves – MAYBE • if on “active duty” under Title 10 orders • National Guard –MAYBE • if on “active duty” under Title 10 orders • if under Title 32 Federal orders (ex. Hurricane Katrina response) • Dependents – MAYBE (limited circumstances) • SM’s spouse or child • Person that SM provided more than 1/2 support for 180 days preceding application for relief under SCRA • Third Parties – POSSIBLY (limited circumstances) • If court grants relief (stay, postponement, suspension of obligation) to SM, the relief may also be granted to persons primarily or secondarily liable with the SM, (50 U.S.C. App. §513)

8. SCRA Overview • WHEN: • Protections Begin … • Entry on “active duty” • Receipt of active duty orders for reserve components • Allows time to get “house in order” (§516) • Protections End … • Release date from “active duty” • Exceptions: • Stays: May file application within 90 days after release • Default Judgments: May file application to set aside default judgment no later than 90 after release

9. SCRA Overview • WHY: • To enable servicemembers to devote themselves to their missions • Battlemind concept • Eliminate / mitigate civil legal and financial issues can hinder Military Preparedness, Moral, Retention / Recruiting • Illinois Army National Guard is deploying 33d Infantry Brigade Combat Team (@2,700 soldiers) to Afghanistan in support of OEF • Deploying over summer and fall • Largest deployment in Illinois since WWII

10. SCRA Benefits and Protections

11. Tolling Statutes of Limitation • Period of military service “may not be included in computing any period limited by law, regulation, or order for the bringing of any action or proceeding … by or against servicemember or the servicemember’s heirs, executors, administrators, or assigns.”

12. Six Percent Rule • A SM may reduce pre-service consumer debt and mortgage interest rates to 6% under certain circumstances • Any interest above 6% is permanently forgiven • Interest above 6% cannot accrue or become due after service • Military service has to have materially affected the SM’s ability to pay pre-service debts • Finance company has the burden of proof to prove that the SM is not materially affected by military service

13. Six Percent Rule • SM must inform finance company of situation in writing and provide a copy of orders • If orders are not readily available at time request is made to creditor, SM has 180 days after release from active duty to provide copy of orders • The term interest includes service charges, renewal charges, fees, or any other charges with respect to an obligation or liability

14. Termination of Residential Leases • Allows termination of lease (dwelling, professional, business, agricultural, or similar) by active duty SMs • Applies to • All pre-service leases • Leases executed on active duty, if SM subsequently receive orders for a permanent change of duty or deployment for 90 days or more

15. Termination of Residential Leases • SM’s dependent is entitled to protection under this provision if they are materially affected by the SM’s military service • Landlords cannot hold dependents liable on joint lease

16. Termination of Automobile Leases • Allows termination of lease for personal or business use by SM or dependent • Must provide written notice, copy of orders, and surrender automobile within 15 days of notice • Applies to • All pre-service leases if entering active duty for more than 180 days • Leases executed on active duty, if SM subsequently receive orders for a permanent change of duty out of continental US or deployment for 180 days or more

17. Mortgage and Lien Rights • If a SM is obligated on real or personal property secured by lien, mortgage, etc., and the obligation originated before the period of active duty, a court must stay the proceeding for an equitable period • To invoke this SM must be materially affected by military service and file an application during or within 90 days after active duty • Sale, foreclosure, or seizure of secured property for a breach is not valid if made within 90 days after active duty period, unless a court order was granted

18. Protection Against Default Judgments • Court is obligated, before entry of default judgment, to require plaintiff to file an affidavit stating whether or not defendant is in military service, or unable to determine • Court may not enter default judgment until attorney is appointed to represent defendant • If attorney cannot contact SM, then “actions by the attorney … shall not waive any defense of the servicemember or otherwise bind the servicemember” • Court can require posting of bond as condition of default judgment • If a default judgment is entered, then Court shall reopen the judgment upon application of SM showing ability to appear materially affected by military service and meritorious defense • Must seek to vacate default within 90 days after release from active duty • Protections for bona fide purchaser for value

19. SCRA Waiver • SM may waive SCRA protections (50 U.S.C. App. §517) • Waiver must be in writing • Waiver must be made during or after period of service

20. SCRA Stay of Proceedings

21. SCRA Stay of Proceedings • SCRA applies toall courts & administrative agencies – federal, state and local -- ALL MEANS ALL • SCRA applies to civil cases only • SCRA and ADR? • likely discretionary

22. SCRA Stay of Proceedings • SM entitled to protections of the SCRA as either plaintiffs or defendants • SM must request SCRA protection

23. SCRA Stay of Proceedings • Where SM Does NOT Have Notice of the proceeding… • Court cannot enter any judgment until its appoints attorney for SM • If attorney cannot locate SM, “actions by the attorney … shall not waive any defense of the servicemember or otherwise bind the servicemember,” (§521(b)(2)) • “…Court shall grant a stay of proceedings for a minimum of 90 days… upon application of counsel or on the court’s own motion…” if Court determines: • SM has defense to action • SM cannot be contacted

24. SCRA Stay of Proceedings • Where SM Has Notice of the proceeding… • Proper Request must be • In writing • Contents • Letter / communication stating necessary facts on (1) how military service materially affects SM’s ability to appear and (2) when SM will be available to appear • Letter / communication from commanding officer (CO) • Upon receiving proper request, stay is MANDATORYfor a minimum of 90 days • Court can also grant stay sua sponte, (§522(b)(1)) • Additional stay can be granted and is within DISCRETION of judge, magistrate, hearing officer, etc.

25. SCRA Stay of Proceedings • LEGAL REPRESENTATIVES • SCRA adds a provision recognizing a legal representative of the SM as: • An attorney acting on the behalf of a SM; or • An individual possessing a power of attorney • Legal representative can take the same actions as a SM • Application for stay “does not constitute an appearance for jurisdictional purposes and does not constitute a waiver of any substantive or procedural defense,” (§522(b)(2))

26. SCRA Stay of Proceedings • If assisting SM to invoke SCRA rights and have no intention of being attorney of record, then be certain to state that you are not attorney of record and actions are not to count as appearance for jurisdiction over SM

27. How to Contact SM • DoD database • Department of Defense (DoD) hyperlink can be used to quickly check if an individual is in active duty military service, https://www.dmdc.osd.mil/scra/owa/home.   • Required information includes: last name and Social Security number.  • A statement of military service can also be requested via: Defense Manpower Data Center (Attn: Military Verification) 1600 Wilson Blvd., Suite 400 Arlington, VA 22209-2593 703.696.6762 telephone 703.696.4156 facsimile • Joint Legal Assistance Website of the Armed Services • http://legalassistance.law.af.mil/

28. How to Contact SM Navy: Navy Personnel Command (PERS 312) 5720 Integrity Drive Millington, TN 38055-3120 (901) 874-3388 Air Force: Headquarters ARMPC/RMIQL 550 C. St. West, Suite 50 Randolph AFB, TX 78150 http:/www.afpc.randolph.af.mil (210) 565-2660 Army Active Duty: Army Worldwide Locator USAEREC 8899 E. 56th Street Indianapolis, IN 46249 http://www.erec.army.mil/wwl/ Marine Corps: Headquarters, USMC Code MMSB-17 2008 Elliot Road, Room 201 Quantico, VA 22134-5030 (703) 784-3942 www.usmc.mil/marinelink

29. Forms • Handouts • Sample SCRA letters: • http://legalassistance.law.af.mil/content/content.php?qrylvl=3&lvl1id=1&lvl1folder=yes&lvl2id=11&lvl2folder=yes

30. State of Illinois Benefits and Protections

31. Statutory Benefits and Protections • Service Member’s Employment Tenure Act (330 ILCS 60/1 et seq.) • Provides employment protection to service members called into active duty service, 330 ILCS 60/4 • Provides a stay of civil actions while serving on active duty, 330 ILCS 60/5.1 • Similar to Federal Servicemembers Civil Relief Act (SCRA)

32. Statutory Benefits and Protections •  The Illinois Patriot Plan (Public Act 094-0635 ) • Residential Lease Protection — • Amends the Code of Civil Procedure—Provides that in an action for possession of residential premises of a tenant or mobile home park resident who is a service member deployed on active duty or of any member of the tenant's or resident's immediate family, the court may stay the proceedings for a period of 90 days or adjust the rental obligation to preserve the parties' interests.

33. Statutory Benefits and Protections •  The Illinois Patriot Plan (Public Act 94-0635 ) cont’d • Termination of Cellular Phone Contracts — Military Personnel Cellular Phone Contract Termination Act: • Provides that a service member called into active duty, or the service member’s spouse, may terminate cellular phone contracts without penalty under certain conditions.

34. Statutory Benefits and Protections •  The Illinois Patriot Plan (Public Act 094-0635 ) cont’d • Interest Protection — • Amends the Interest Act—Provides that no creditor shall charge or collect from a service member, or spouse, interest or finance charges exceeding 6% per annum during the period that the member is deployed on active duty.

35. Resources • All parts of society are deployed in support of the GWOT. • Accordingly, the entireIllinois community must serve as the support system for these citizen-soldiers and their families.

36. Discussion of Cir. Ct. Cook Co. / CVLS Initiative • Both the Bench and the Bar can help