GPSolo Magazine - January February 2005

SCRA: For Those Who Go In Harm’s Way

The week mercifully concluded with an invite from a colleague to join him at a local tavern. South Dakota barrister Windom looked forward to the libation with passion. On his way out the door, trouble rang. His loyal paralegal, Stella, reported a phone call from a woman whose will Windom had drafted some years before. Now she had a crisis on her hands and needed an attorney immediately. Torn between a Budweiser and a telephone call that surely would prove lengthy, Windom whispered to his loyal assistant, “Tell her I already left.” Stella responded, “Boss, she says there are men with legal papers at her door demanding she accept them. They involve custody of her two grandchildren. Mr. Budweiser can wait. Take this now. Her name is Mrs. Gretchem.” Windom sighed and grasped the telephone. “Good afternoon, Mrs. Gretchem, how can I help you?”

“Mr. Windom, I am standing here with my late husband’s shotgun in my hands aimed at two men who say they have a court document transferring child custody from me to my daughter’s ex-husband, who just happens to be the world’s biggest drunk and spouse abuser. I am seconds from pulling the trigger on these two.” Windom anxiously replied, “Let’s not be hasty, Mrs. Gretchem. You have my undivided attention. Now tell me what is going on.” She explained, “My daughter is a sergeant in the Air National Guard and her unit activated a month ago. She left her two babies with me along with a child care power of attorney and her Family Care Plan approved by the Army. After her divorce a year ago, she received custody of both children, but now these two loons say that her ex is the legal custodian and they have a court order to prove it.”

Mrs. Gretchem paused, “Hold on a minute while I cut loose with one barrel to let them know no one is taking anyone anywhere.” With adrenalin pumping through every corpuscle in his body, Windom screamed, “No, Mrs. G! Those may be law enforcement officers! Tell them that you are talking to your lawyer on the phone, and to place the court order on the porch and back off for a few minutes. Then pick it up and read it to me.” While Mrs. Gretchem did as instructed, Windom shouted to Stella, “Find out how far it is to Mrs. G’s farm, and get Sheriff Wycliff on the phone and tell him I need a flashing light escort out there yesterday!”

After listening for several minutes to Mrs. Gretchem’s recitation of the legal doc- ument, lawyer Windom stated, “This is notice of a hearing on a petition to transfer child custody.” Mrs. Gretchem retorted, “But my daughter is in Iraq. How is she going to appear or even hear of this? I have not heard from her since she left.” Windom responded, “I am beginning to feel your desperation.” “Hold on a minute Mr. Windom,” Mrs. G replied, “our bloodhound Sherlock is dragging one of these fellas around the front yard and he may not last another furlong.” “Mrs. G, I am on my way out there now,” said Windom. “Tell everyone and Sherlock to stay calm, and we will work this out.”

Because most civil actions involving servicemembers relate to domestic relations, mobilized and deployed members of the Guard and Reserve are vulnerable victims of temporary child custody and changes in child support and alimony. Creditor repossession and default actions also unfairly impact the absent servicemember. Deployed to Iraq, how will Sergeant Gretchem take losing custody of her children and termination of child support payments by her ex-husband? Will it affect her focus and ability to perform her duties while going in harm’s way? How can she get away from her duties to return and testify against her ex-husband so that her mother can retain custody? How many others may be impacted as well? What can lawyer Windom do to represent the absent military client?

The purpose of this article is to summarize and explain the new Servicemembers Civil Relief Act of 2003 (SCRA), signed into law on December 19, 2003 (50 U.S.C. §§ 501-596). It is the successor to the Soldiers’ and Sailors’ Civil Relief Act (SSCRA) originally enacted in 1918, reenacted in 1940, and amended numerous times. The basic premise of the SCRA is that servicemembers should not be placed at a disadvantage, either legally or financially, when called to active military service.

The new SCRA’s protections continue to address, like its SSCRA predecessor, primarily legal rights and financial obligations. Furthermore, these SCRA protections apply only to civil actions, not criminal ones. While servicemembers are away on duty, disputes arise about the existence and extent of their liability or obligations, raising questions about members’ ability to adequately protect their rights as citizens. Similar problems occur in financial situations. Servicemembers may admit the existence of a fixed obligation or liability but still seek relief under the SCRA because of the material impact military service has on their ability to meet this obligation or liability. Trial courts adjudicating such disputes are sometimes bound by a particular SCRA provision to presume “material affect,” while other sections authorize a judge to determine whether a servicemember’s ability to defend legal rights or meet financial obligations is affected by his or her military service. The new SCRA is a lengthy read. What follows is a brief synopsis of the salient provisions a general practitioner might like to know “before heading out to Mrs. Gretchem’s farm.”


When do SCRA protections begin? SCRA protections begin when a member enters military service. The term military service signifies federal service on active duty with any branch of service. Additionally, in the case of a member of the National Guard, it includes service under a call to active service authorized by the president or secretary of defense for a period of more than 30 consecutive days for purposes of responding to a national emergency declared by the president and supported by federal funds (e.g., airport security after September 11, 2001).


The term “court” as used in the SCRA includes any court of competent jurisdiction of the United States or of any state, regardless of whether it is a court of record, and any administrative agency. This often involves state administrative and child support hearings. Dependents, as used in the SCRA, are defined as the servicemember’s spouse, child, or an individual for whom the servicemember provided more than one-half of the individual’s support for 180 days immediately preceding an application for relief under the SCRA.

Dependents are entitled to various SCRA protections. First, dependents are entitled to protections noted within specific provisions. In addition, although dependents are not mentioned in all protections, nevertheless, “derivative protection” is obtained by virtue of property or accounts being titled in a servicemember’s name with that of a spouse or other family member, or by simply being a dependent. Finally, Title III protections may be invoked by dependents of servicemembers regardless of whether the supporting servicemember is a party to the underlying obligation or liability. Title III benefits include protection from eviction, protection from installment contract termination, protection from mortgage foreclosure, and authority for early termination of leases. Courts have repeatedly found such derivative protection to exist based on the dependency or former dependency status of the family member to the servicemember.

The SCRA offers many protections; however, there is no SCRA protection for Reservists, National Guardsmen (with the one exception noted above), or retirees, as the SCRA’s protections clearly apply only to those in active federal service. Furthermore, although most SCRA protections are no longer available when a servicemember leaves active duty, there are exceptions noted in specific sections that can extend the SCRA’s protections up to six months.

Default Judgments

Perhaps one of the most pernicious actions that can affect a servicemember away from home is a default judgment. Unilateral action divesting property interests or domestic relations issues materially impacts servicemembers’ morale and welfare when they are unable to represent their interests because of involuntary absence from home. For these and other practical reasons, Congress enacted procedural safeguards to protect the interests of those employed in the nation’s most important business.

If there is a default in the appearance by the defendant, the plaintiff must file an affidavit before judgment can be taken in any state or federal court. This affidavit must state either that (1) the defendant is or is not in military service; or (2) that the plaintiff is unable to determine whether or not the defendant is in military service. The SCRA specifically states that a court will not enter a default judgment until the plaintiff meets the SCRA’s requirements. Any judgment obtained without meeting this procedural requirement places it at risk of future attack. When a judgment is filed without rendering the requisite affidavit, courts have uniformly held that the judgment is not void ab initio, only voidable, meaning it is subject to being vacated at the request of the servicemember, but only upon proper showing that he or she has been prejudiced in making a defense by reason of military service and that a meritorious defense exists.

If the plaintiff does not file an affidavit indicating the defendant is not in military service, then the SCRA requires the court to appoint an attorney to represent the defendant and to protect the defendant’s interests before entering a default judgment. While this offers some protection for the servicemember, admittedly failure to have your client present to assist in defense is a major burden for any court-appointed attorney. The SCRA provides that if a court-appointed attorney cannot locate the client servicemember, the attorney cannot waive any defense of the servicemember or otherwise bind the servicemember.

The SCRA also provides that if the defendant is in military service, upon application by counsel or on the court’s own motion, the court shall grant a stay for a minimum period of 90 days if there may be a defense to the action and a defense cannot be presented without the defendant’s presence, or if after due diligence counsel has been unable to locate the servicemember or determine if a meritorious defense exists.

Failure to appoint an attorney as required by this SCRA provision does not necessarily require reversal but does entitle the servicemember to reopen the judgment, provided the member can show (1) that military service materially affected the member’s ability to defend his or her interest and (2) that a meritorious defense exists.

Stay of Proceedings

This is perhaps the most frequently used SCRA procedural protection to prevent civil actions that might result in default judgments because of the servicemember’s inability to appear and represent his or her interest. The SCRA provides that a servicemember may request a stay in any proceeding during the period of military service and up to 60 days after its termination, at any stage of any action or proceeding in any court in which a servicemember is a defendant. Such a request will be granted upon application by the servicemember for not less than 90 days, provided the servicemember or his or her legal representative sends (1) a letter or other communication setting forth facts explaining that current military requirements materially affect the servicemember’s ability to appear, and stating a date when the member can appear; and (2) a letter or other communication from the servicemember’s commanding officer confirming that military duty requirements prevent the member’s appearance and that no military leave is presently authorized. Additional stays may be requested following the same procedures, but such stays are discretionary by the court. Stay applications expressly shall not constitute an appearance for jurisdictional purposes and do not constitute a waiver of any substantive or procedural defense. Servicemembers assigned overseas or aboard a ship may have an easier showing in requests for additional stays than those whose military installations are in the United States.

Courts all have one thing in common. They desire to keep their dockets moving, and so they do not respond favorably to open-ended delay requests. However, when presented with official notice, status, and a factual basis why the servicemember cannot appear, courts have been indulgent and supportive of this protection. Furthermore, refusal to grant a requested stay of proceedings may be grounds for appeal.

Maximum 6 Percent Rate of Interest

One protection that virtually all servicemembers can utilize upon entering military service for the first time, or being activated as a Reservist for a period of 30 days or longer, is the ceiling placed on all interest-bearing obligations. Because most citizens incur some form of debt prior to entering onto active duty (e.g., auto loans, credit cards, mortgages, and credit union and bank loans), this is significant financial assistance for servicemembers who enter the armed forces each year. This protection does not apply, however, to any new debt incurred after entering onto active duty.

This provision provides that no obligation or liability-bearing interest at a rate in excess of 6 percent per year incurred prior to that person’s entry into military service shall, during any part of the period of military service, bear interest at a rate in excess of 6 percent per year. This ceiling applies unless, in the opinion of the court, and upon application by the creditor, the ability of a person in military service to pay interest upon an obligation or liability at a rate in excess of 6 percent is not materially affected by reason of his or her service. As used in this section, the term “interest” includes service charges, renewal charges, fees, or any other charges (except bona fide insurance) with respect to the obligation or liability. The 2003 SCRA specifically states that the difference in interest between the cap and the original interest rate will be forgiven, not reamortized.

This protection sets out implementation requirements. The servicemember must request application of the interest cap from the creditor in writing. The member must also attach a copy of the orders calling the member to military service. The military orders state the statutory authority and period of time the servicemember is called to federal service. This allows the creditor to program its billing program for the period of time listed in the orders.

The SCRA’s language clearly states that the 6 percent interest cap protection is automatic. The burden is on the creditor to file an action in a court seeking relief against application of this interest cap. The creditor meets this burden by demonstrating that the servicemember’s military service does not materially affect his or her ability to pay at the previously agreed obligation rate in excess of 6 percent. Few creditors are willing to take on this burden in light of the fact that the U.S. Department of Justice has assumed responsibility for enforcing SCRA protections. The amount of interest in excess of 6 percent must be significant for a creditor to confront the Department of Justice and the extensive case law supporting broad interpretation and favorable disposition to servicemembers.


This protection prevents eviction of servicemembers and their dependents for nonpayment of rent without a court order. To be eligible for this protection, the rent must not exceed $2,465 per month (as of 2004), and the premises must be occupied as a dwelling, not for business purposes. The rent ceiling eligibility is based on a formula that will increase annually with inflation. While the term “eviction” is not defined in the SCRA, courts have routinely applied its common law meaning. A landlord can evict a servicemember and/or his or her family only after obtaining a court order. The burden is on the landlord to prove that the military member’s service does not materially affect his or her ability or that of his or her dependents to pay the rent.

The protection further provides that the court may on its own motion, and shall on application, either stay the eviction proceedings for not longer than 90 days or “adjust the obligation under the lease to preserve the interests of all parties.” This authority provides a court equitable discretion to fashion a solution according to the merits of the situation while bearing in mind the legislative intent to protect a military member’s family from non-court-ordered and sometimes no-notice evictions for failure to pay rent on time. Furthermore, criminal sanctions may be imposed by fine under Title 18 U.S.C. or confinement for up to one year, or both, for taking part in an eviction in violation of this protection. Additionally, there is always the availability of a private cause of action.

Termination of Residential or Motor Vehicle Leases by Lessees

This protection applies to any lease covering residential, professional, business, agricultural, or similar purposes, and leases of motor vehicles, entered into by a servicemember or on his or her behalf prior to entry into military service. Leased premises must have been occupied for such purposes. Any lease of this nature entered into prior to military service may be terminated unilaterally by the servicemember.

In addition,the SCRA includes an entirely new protection authorizing a servicemember to terminate not only a pre-service dwelling, professional, business, agricultural, or similar lease, but also leases entered into while on active duty when the member subsequently receives orders for a permanent change of station, or a deployment for a period of 90 days. This protection also applies to automobiles leased for either personal or business purposes, or for use by the servicemember’s dependents.

The lease termination must be in writing and delivered to the lessor or the lessor’s agent at any time after the beginning of military service. After delivery of the termination notice, the military member is liable for up to one month’s rent after the first date on which the next rental payment is due. In the case of a leased vehicle, responsibility for payment terminates upon delivery of the vehicle to the lessor.


Moving one’s tent and family possessions is indigenous to military life. It is not uncommon for an enlisted servicemember or officer to experience upward of 25 household moves during a 20-year career. As a consequence, servicemembers live in many states and municipal jurisdictions where local authorities often seek to tax these itinerant uniformed public servants. Congress anticipated this dilemma. The SCRA provides that servicemembers neither lose nor acquire a new residence for purposes of taxation with respect to their person, personal property, or income by reason of being absent or present in any tax jurisdiction pursuant to military orders.

This protection creates an exception to the general rule that income may be taxed where it is earned as well as where the taxpayer is domiciled. Except for the state of domicile, no state can tax the compensation of the servicemember. Furthermore, local school systems may not charge nondomiciliary military personnel tuition for their children attending public schools. However, off-duty income earned by military personnel is not protected by this section and is subject to state and local taxation where earned.

Another tax issue addressed by SCRA concerns the joint filing of a servicemember with his or her civilian spouse. Previously, some states included the servicemember’s military income when calculating the civilian spouse’s total income—even though the servicemember’s income is not taxed. The SCRA eliminated this problem by expressly prohibiting the use of a servicemember’s military income in determining the tax of his or her civilian spouse.

There are many different classifications of property, some that are protected from taxation by the SCRA and some that are not. Although real property is not protected because it normally is taxed only by the state in which it is located, tangible nonbusiness personal property is a different matter; it is protected from local personal property tax, also known as ad valorem taxes. On the other hand, intangible nonbusiness personal property, including stocks, bonds, and bank deposits, has the legal situs of the servicemember’s domicile. Furthermore, military personnel are not exempt from sales and use taxes, and the business property of a servicemember is not within the protective scope of the SCRA and therefore is subject to tax wherever it is located.

Professional Liability Insurance

One major change of special interest to mobilized reserve military lawyers is professional liability insurance. The new SCRA allows a servicemember with a pre-service professional liability insurance policy to suspend premiums and coverage during active military service. The protection requires suspension of all claims brought during the period of military service. It also mandates reinstatement of the insurance at the conclusion of military service at the premium rate that would have existed had the member not entered military service.

This article is not intended to be an exhaustive review of the new SCRA. On the contrary, general practitioners are urged to review more in-depth information in the statute and at, a website maintained by the ABA Standing Committee on Legal Assistance for Military Personnel.

And, finally, back to Mrs. Gretchem. Does the shotgun, Sherlock, or the SCRA provide the most assistance in resolving this child custody dispute?

Gregory M. Huckabee is an associate professor of business law at the University of South Dakota who served 27 years as a Regular Army Judge Advocate. From 1990 to 1991, he served as chair of the Department of Defense Soldiers’ and Sailors’ Civil Relief Act Joint Service Task Force in the Pentagon, drafting the basic recommendations that became the SCRA of 2003. He can be reached at


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