In the relatively short period of time since I last wrote about military/employment law for this publication, many significant changes have occurred in the law. Due to the high number of reservists and guardsmen activated, practitioners should be aware of these changes in order to fully protect their client’s rights, whether individuals or employing entities.1
The "New" Servicemembers Civil Relief Act
On December 19, 2003, President George W. Bush enacted what has been termed "a sweeping reform" of the Soldiers and Sailors Civil Relief Act of 1940 (the "SSCRA"), as amended. The new gender non-specific law, is entitled the "Servicemembers Civil Relief Act ("SCRA").2 As the statute itself provides, it amends the SSCRA, rather than replacing the preceding act in its entirety. It is the opinion of the author that this was done so that opinions published construing the SSCRA would have application under the SCRA as well.
Viewed in an historical context, the SCRA is the latest iteration of our government’s intent to respond to specific hardships of those called to defend our freedoms.3 The first SSCRA was enacted in 1918 (World War I), amended after World War II, and based upon the experiences of those called to active duty during the Persian Gulf War, was amended again by President George H. Bush in 1991. Thus, the 2003 law signed by President George W. Bush is an attempt to further define the rights of service members called to active duty, principally in Afghanistan and Iraq.4
Recent commentators are in seeming agreement that the new Servicemembers Civil Relief Act (SCRA) both expand the SSCRA’s protections and added new rights as well.5 In summary fashion, the highlights of the new act are:
Staying Proceedings. A non discretionary 90 day stay of civil proceedings upon application of the service member (a "letter or other communication"),6 with a letter from his or her Commanding Officer stating that the service member’s current military duty prevents appearance, and that military leave is not authorized for the service member at the time of the letter.7 Previously, under the SSCRA, many jurisdictions thought that judges had discretion as to whether a stay request should be granted. Also, the SCRA makes clear that a request for a stay by an activated reservist or guardsman will not be considered an Appearance for jurisdictional purposes. It appears the minority view of Illinois courts regarding this issue is adopted in the new legislation.8
Before discussing the other generally accepted protections afforded by the new act, it would be remiss to not discuss at least two aspects of the SCRA that will have direct application to local practice. First, Title II of the Act9 applies to "any civil action or proceeding in which the defendant does not make an appearance." Pursuant to Title II, before entering judgment in favor of the plaintiff, the court shall require the plaintiff to file an affidavit stating whether or not the defendant is in the military service, and providing necessary facts to support the affidavit, or stating that the plaintiff is unable to determine whether the defendant is in the military service.10 Second, if the defendant is in military service, the court may not enter a judgment until after the court appoints an attorney to represent the defendant.11 Third, if a defendant’s military status cannot be ascertained by the court, then the plaintiff must file a bond approved by the court which would indemnify the defendant against any loss or damage the defendant might suffer as a result of the judgment being set aside in the future.12 Note that the statute provides that the affidavit must be made or declared to be true under penalty of perjury,13 and that in the event that the affidavit submitted is false, federal, not state, penalties pursuant to title 18 of the United States Code apply, including imprisonment for "not more than one year".14 Naturally, an attorney should be concerned about the status of their law license if he or she knowingly presents a false affidavit. Last, in the event a default judgment enters against a service member, the law provides a vehicle for the vacatur of such default judgment which was entered during the period of his or her military service, and within sixty (60) days after release from such service.15 The service member would have to prove to the court that he or she was materially affected by reason of military service to defend the action, and that the service member has a meritorious or legal defense to the action, or some part of it. It would appear that this is not a difficult bar to traverse.
In conjunction with the foregoing, one should note that the new Act actually has two stay provisions. The first, discussed above, where the service member requests through his or her chain of command that a letter be sent to the court in accordance with Section 202 of the Act16. The second stay provision is contained in Section 201 of the Act.17 Section 201 allows a practitioner who represents an individual called to active duty, to move the court for a stay for a minimum period of ninety (90) days upon a showing that there may be a defense to the action, and that the defense cannot be presented without the physical presence of the defendant; or, that upon due diligence, counsel cannot contact the defendant or otherwise determine whether a meritorious defense exits.18
A six percent (6%) interest rate limitation. The SCRA provides a clarification that the application of the six percent interest rate cap on mortgages, credit cards, etc., is a forgiveness of any rate of interest over six percent. Previously, lenders argued that the six percent provision under the SSCRA was only applicable while a person was on active duty, and that the service member was responsible to pay back the lending institution or company for the difference in interest after the period of qualifying military service ended.19
As in the previous iteration of the law, a person ordered to active duty must provide written notice to the creditor of that fact, and a copy of the activation orders. Although not a requirement under the Act, it has been the observation of the author that service members are urged to transmit this creditor communication via certified mail, return receipt requested.
Forcible Entries and Detainer ("FE&D’s"). The SCRA increased the maximum lease amount for purposes of determining whether to evict a service member or the dependents of a service member. Thus, a court may not evict a service member or the dependents of a service member if the premises are occupied or intended to be occupied primarily as a residence, and the monthly rent does not exceed $2,400.00 per month.20
Right to Terminate a Residential Lease. The SCRA has now expanded the right of a service member to terminate a lease. Previously, a service member could only terminate a lease if ordered to active duty. Now, a service member may terminate a residential lease if he or she receives PCS (Permanent Change of Station) orders, or deploys for at least ninety (90) days. Note that the notice requirements under the SCRA remain unchanged from the SSCRA.
Right to Terminate a Vehicle Lease. The SCRA now provides rights to terminate vehicle leases that parallel the right to terminate a residential lease.21
Note that the Act now provides that a creditor may not repossess a vehicle from a service member, without first obtaining a court order.22 Further, recall the discussion infra regarding submission to the court of what is typically termed a Military Affidavit. Without being verbose, this provision of the Act could present interesting scenarios, as it would appear that to fully protect itself, banks and other lenders now have to file a law suit in order to repossess any vehicle.
Level of Life Insurance Protected Against Lapse. Under the SCRA, the amount of life insurance coverage protected from lapse, upon application to the Secretary of Veterans Affairs, was increased from $10,000.00 to $250,000.00. This level of coverage will increase automatically if SGLI (Service member’s Group Life Insurance) maximum is increased.23
Voiding of the "Kansas Rule". The new Act voids the application of what is known as the "Kansas Rule". Previously, twenty-five (25) jurisdictions in the United States utilized this rule to add the military income of non-resident service members to civilian spouses, in order to place the civilian spouse in a higher tax bracket. Now, tax jurisdictions may not use the income of non-resident military members for any purpose.24
Collection of income tax. Upon application by a service member, the collection of income tax from such service member can be deferred, without payment of penalty or interest, for up to 180 days after that person’s release from active duty, if the service member’s ability to pay such tax was materially affected by his or her military service.25
While some commentators on the new Act do not recognize the expansion of professional liability protections afforded by the new Act as significant, this author would opine that as it applies to legal professionals, the new SCRA finally provides needed protection to Reserve and Guard Judge Advocates called to active duty, protections previously afforded only to those in medical fields. The Act provides that if the Judge Advocate called to active duty was engaged in the provision of legal services, and had in effect a professional liability insurance policy, a Judge Advocate now has the ability to notify the insurance carrier to suspend the insurance contract, and that premiums for such suspended contract do not have to be made.26
USSERRA, Revisited, and Related Commentary
It has been noted in this publication that USERRA has an interesting twist.27 That twist is that if state law has more expansive protections than available under USERRA, then the broader state law provisions apply. Note that four pieces of legislation have been most recently signed by Governor Blagoievich. First, House Bill 4660 ("The Service Members Employment Tenure Act", 330 ILCS 60/1 et seq., as amended) sponsored by Rep. Lisa Dugan of Kankakee, and Sen. George Shadid of Pekin, strengthens employment protection by providing fines that range from $5,000.00 to $10,000.00 if an employer terminates a service member’s employment while he or she is serving on active duty. The law also requires the employer to compensate the service member for any loss of wages or benefits, and contains a provision for the payment of reasonable attorneys’ fees and costs. Second, although not providing a more expansive protection to service members, Senate Bill 2526 provides that the Illinois Department of Military Affairs publish a document available to Illinois service members outlining both the rights and responsibilities of Illinois service members pursuant to both state and federal laws. Third, House Bill 4372 gives Illinois National Guardsmen the same rights when called to active federal duty as they receive when called to active duty by the Governor of the state of Illinois. This is viewed as a most important expansion of rights, as the Illinois statute previously provided protection only to those called to active duty by the Governor, but not pursuant to a federal call up. Last, House Bill 4491 sponsored by Rep. Ron Stephens of Troy and Sen. Denny Jacobs of Moline, amended the Illinois school code to provide that the definition of "eligible veteran" or "service personnel" will now include Illinois National Guard Members. This change makes guard personnel eligible for scholarships if they are declared prisoners of war or missing in action, or are permanently disabled from service connected injuries while on active duty or in training.28
The point to be made is that this area of the law is an evolving one, and certainly not static, having application both to service members and employers. An astute practitioner would be wise to examine these laws in order to fully enforce or protect the rights of a client, whether an individual or an employing entity.
1 See: Dobra, Charles Wm. The Impact of the Uniform Services Employment and Re-Employment Rights Act of 1994, Du Page County Bar Brief, May/June 1995; Dobra, Charles Wm. A Short Primer on the Soldiers and Sailors Civil Relief Act, Du Page County Bar Brief, February, 1997.
2 Public Law 108-189 – December 19, 2003; 117 Stat. 2324, 50 USC app 501. The full text of the statute can be found at: thomas.loc.gov.
3 As oft noted, "freedom" is not free.
4 One might argue that the present war against Islamic terrorists is not a new one; note, from the Marine Corps Hymn: "…to the shores of Tripoli".
5 See, e.g., Colosimo, Carl D., The New "Servicemembers Civil Relief Act" Protecting the Men and Women Who Protect You, Kane County Bar Association Bar Brief, May, 2004, p.30. Note, The New Servicemembers Civil Relief Act, The Military Advocate, Fall 2003/Winter 2004, at p. 3 et seq.
6 50 USC app 522 (b) (2) (A).
7 50 USC app 522 (b) (2) (B). See, also: 50 USC app 524.
8 Ibid, n. 2, A Short Primer on the Soldiers and Sailors Civil Act, at Section 5.
9 Section 201. Protection of Servicemembers Against Default Judgments. 50 USC app 521.
10 The "jurisdiction" and applicability of the Act is quite broad. Needless to say, it applies to all Illinois state court civil actions. See: 50 USC app. 512. The affidavit is typically referred to both in Cook and Du Page Counties as "The Military Affidavit".
11 The author was once appointed by Du Page County Judge, now Justice, Robert E. Byrne to represent a service member. See: 50 USC app 521(b) (2).
12 See: 50 USC app 521(b) (3).
13 50 USC app 521(b) (4).
14 30 USC app 521(b) (4) (c).
15 See: 521 USC app 521(g) (1).
16 50 USC app 522.
17 50 USC app 521(d).
18 See: 50 USC app 521(d) (1) & (2).
19 See, generally: 50 USC app 527 et seq.
20 50 USC app 531 (a) (1) (A) & (B). Note that the stated amount is subject to increase based upon the Consumer Price Index ("CPI"). See: 50 USC app 531(b) et seq.
21 50 USC app 535.
22 See: 50 USC app 532 (a) (B).
23 See, generally: 50 USC app 542, et seq.
24 50 USC app 571.
25 50 USC app 570.
26 50 USC app 593.
27 See: DuPriest, Joanna G. The Uniformed Services Employment and Reemployment Rights Act of 1994 and the Service Men’s Employment Tenure Act: What Every Employer Should Know, Du Page County Bar Brief, February, 2002.
28 See: New Laws Secure Jobs, Rights of Guard, Reserve Personnel, ISBA Bar News & Illinois Courts Bulletin, August, 2004, at p. 16.
Charles Dobra is a Member of the Du Page County Bar; he is currently a Commander in the United States Naval Reserve, Judge Advocate General’s Corps, and the Commanding Officer of VTU 1314 (Law), Great Lakes Illinois. He is also the Chair of the Du Page County Ad Hoc Committee for Military Law and Veterans’ Affairs, Chair, Chicago Bar Association Standing Committee on Military Law and Veterans Affairs, a Member of the Illinois State Bar Association Committee on Military Law and Veterans’ Affairs, and a Member of the Judge Advocates Association, Washington, DC. The author has been a frequent presenter and participant in programs to both the Illinois Bar and the general public regarding legal issues affecting employers and military reservists and guardsmen.