Jackson & Campbell P.C. Update January 27, 2004
Dear Real Estate Professional:
New Federal Statute Replaces Soldiers' and Sailors' Civil Relief Act.
Landlords, lessors, lenders, insurers, auction houses, and their counsel should take note that, on December 19, 2003 the "Servicemembers Civil Relief Act" ("SCRA")(Public Law No. 108-189 (2003)" was signed into law by President Bush, completely revising the old law (previously known as the "Solders' and Sailors' Civil Relief Act" ("SSCRA")) which had its last major revision in 1940.
Summary:
Servicemember are entitled to automatic stay of state and federal administrative as well as judicial proceedings upon request and further stays may be granted at discretion of judge/hearing examiner. Same protection for dependents and guarantors.
If Servicemember's ability to repay is impaired by virtue of his/her service, interest on all pre-service debts in excess of 6% must be forgiven, upon written request by servicemember to lender/obligee with copy of his/her orders.
Residential landlords may not evict if the monthly rent does not exceed $2,465 (this is the ceiling for 2004; formula is provided for subsequent years).
Residential real estate leases no longer will need a military termination clause. The servicemember has the right to terminate such leases if s/he receives permanent change of station (PCS) orders or deployment orders of at least 90 days. Similar protections for storage leases.
Automobile Leases: Pre-service leases may be terminated upon active duty order for a period in excess of 180 days or to a station abroad.
State Taxes: States are precluded from increasing tax bracket of non-military spouse solely by virtue of adding the servicemember's salary in the calculation. Click here for article on this particular aspect of taxation.
National Guard: If call to active duty is for more than 30 days, the SCRA applies, as it does to Public Health Service.
Legal Representation: Permits the court to appoint a legal representative of the servicemember (similar to a "guardian ad litem").
Protections May Not Be Waived Prospectively: Servicemembers may not waive rights before they enter active duty (but they may waive them during or after service).
Business/Trade Debts: If servicemember is personally liable for a trade/business debt, assets not held in connection with that business may not be used to satisfy the obligation during term of service.
PENALTIES for Taking Actions Inconsistent with Act: Severe sanctions outlined in Section 307(c).
In light of the more expansive scope of the Servicemembers Civil Relief Act and the sanctions for non-compliance, counsel should be careful about executing Affidavits of diligent search. Some counsel have determined that the better course would be to require the client lender/landlord to so certify. This is especially true in light of the recent issuance of active duty orders.
Commercial search services (i.e. www.ServiceMemberCivilReliefAct.com) will be available within a month. SoldiersSailorsReliefAct.com has been taken off-line until the revised site is operational. Such a search generates inquiries to all military branches (as well as the Public Health Service) and the Navy, in particular, takes more than ten (10) weeks to respond, therefor a search should be requested well in advance so as not to delay application for judgment.
Click here for text of Act
Click here for News Release from House Committee on Veterans Affairs
Active Service Members: New statutes provide: Military and Foreign Service personnel are allowed to utilize the $250,000 tax-free exemption if they have lived the home for 2 of the 15 years preceding sale (instead of 5 years) provided that, for 10 of those years, they were posted in a different duty station at least 50 miles from their home. This is retroactive, so some servicemen may wish to amend prior returns. Additionally, pay earned by enlisted personnel while serving in a combat zone is not generally taxed.
To update your list of very handy websites:
www.NTIWeb.com: an excellent site made available by Chicago Title to its agents and clients with state-specific customs (i.e. who traditionally pays for premiums, recording taxes, recording requirements, etc.) and other information.
www.FreeTimeSheet.com: provides a free integrated timesheet, expense reporting and project tracking for up to 5 users (you will have to put up with their advertising).
www.FindLaw.com: good, free portal with links to resource materials in various practice groups.
http://Thomas.loc.Gov: Full text of federal legislation, roll-call votes, complete Congressional Record.
www.USCourts.gov: An ever-improving site giving access to federal courts, opinions, rules, guidelines.
http://www.washington.dc.us.landata.com: Obtain copies of documents recorded at the D.C. Recorder of Deeds. Search by party name, lot/square, or instrument number. Free version will not let you view documents. Registered users may view documents for free (but modest per-document charge to print).
www.EntreWorld.org: A wonderful site geared towards entrepreneurs produced by the Kauffman Foundation (no relation to Roy Kaufmann)
www.TheUltimates.com: one of the best search tools for addresses and names. It includes a "reverse search" where you put in the phone number and the listing is provided, but does not include a "criss-cross" whereby you can put in an address and confirm the listed phone and/or occupants.
Please feel free to circulate this newsletter to others in the industry, both within and outside your office.Sincerely,
Roy L. Kaufmann of the Real Property and Asset Management Group
Jackson & Campbell P.C.
email: rkaufmann@jackscamp.com
voice: (202) 457-1600
web: http://www.JacksCamp.comcall us :: (202) 457-6710
This email was sent to rkaufmann@jackscamp.com, at your request, by Jackson & Campbell P.C..
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