Minnesota Bankruptcy: Protections for Members of the Military


The Servicemembers’ Civil Relief Act (“SCRA”) is found at 50 U.S.C. app. §§ 501 et seq. The purpose of the SCRA is strengthen and expedite national defense by giving servicemembers certain protections in civil actions.

Purpose of the SCRA

By providing for the temporary suspension of judicial and administrative proceedings and transactions that may adversely affect servicemembers during their military service, the SCRA enables servicemembers to focus their energy on the defense of the United States.

Among other things, the SCRA allows for forbearance and reduced interest on certain obligations incurred prior to military service, and it restricts default judgments against servicemembers and rental evictions of servicemembers and all their dependents.

Bankruptcy Protections for Servicemembers

The protections in certain civil actions against servicemembers also apply in bankruptcy court.

The Federal Rules of Civil Procedure and the Federal Rules of Bankruptcy Procedure mention the SRCA. These rules make clear that the default judgment requirements of the SCRA which are designed to protect servicemembers apply in bankruptcy cases as well.

A default judgment is an order against the defendant in a case, imposed by the court, for the defendant’s failure to contest the allegations made by the plaintiff. The defendant loses by default. The interest our country has in ensuring that a servicemember’s top priority is the role he or she plays in the military is fostered by preventing default judgments from being entered against military members who may be otherwise unaware of a complaint or unable to answer its allegations.

Other Protections for Servicemembers

The SCRA provides protections in other areas of civil actions as well. If a servicemember receives notice of a civil action against him or her and receives notice of this action, the servicemember may ask the court to put a hold on the case. This hold is also called a stay. The proceedings are stayed under certain circumstances.

The court will stay the case for at least 90 days if the court is informed that the military member’s service duties affect his or her ability to appear in court and when the servicemember will be able to appear, and the servicemember’s commanding officer informs the court that military leave is not authorized at the time.

Who Qualifies for the Protections of the SCRA?

The SCRA applies to all members of the United States military on active duty, and to U.S. citizens serving in the military of United States allies in the prosecution of a war or military action.

The provisions of the SCRA generally end when a servicemember is discharged from active duty or within 90 days of discharge, or when the servicemember dies.

Portions of the SCRA also apply to reservists and inductees who have received orders but not yet reported to active duty or induction into the military service.