The Servicemembers Civil Relief Act (SCRA):
Does It Provide for a Private Cause of Action?
R. Chuck Mason
Legislative Attorney
March 23, 2009
Congressional Research Service
7-5700
www.crs.gov
R40456
CRS Report for Congress
P
repared for Members and Committees of Congress
The Servicemembers Civil Relief Act: Does It Provide for a Private Cause of Action?
Summary
Congress has long recognized the need for protective legislation for servicemembers whose
service to the nation may compromise their ability to meet obligations and protect their legal
interests. The purpose of the Servicemembers Civil Relief Act is to provide for, strengthen, and
expedite the national defense by protecting servicemembers, enabling them to “devote their entire
energy to the defense needs of the Nation.” The SCRA protects servicemembers by temporarily
suspending certain judicial and administrative proceedings and transactions that may adversely
affect their legal rights during military service.
Various sections of the SCRA include provisions providing for penalties for violations of the
afforded protections. The act does not specifically state who may bring an application for relief,
nor does it specifically exclude private individuals from filing a cause of action. Most courts
considering the issue have found that a private cause of action exists under the SCRA. However,
a recent opinion from the United States District Court for the Western District of Michigan,
Hurley v. Deutsche Bank Trust Company, disagreed with decisions from U.S. district courts in
Illinois, Louisiana, Oregon, and Texas, and found that a private cause of action does not exist
under the act.
While the U.S. Supreme Court has not ruled on whether a private cause of action exists under the
SCRA, the Court has dealt with the issue of an implied cause of action under other statutes. In
Cort v. Ash, the Court established a four-part test for determining if a private cause of action
exists under a particular statute. However, in Alexander v. Sandoval, it appears that the Court has
adopted a single-factor test rather than the four-part test.
The split in the U.S. district courts creates uncertainty in how the act may be enforced in the
future. In many jurisdictions across the country it may be unclear whether a servicemember has
the right to bring a private cause of action for violations of the SCRA. This ambiguity is likely to
persist if the courts continue to reach different conclusions on the right to bring a private cause of
action. The current ambiguity provides options for Congress. Congress may provide guidance to
the courts by clarifying the purpose and intent of the act. A bill introduced in the 110th Congress
would have done so. Or Congress may want to amend individual sections of the act or the act in
its entirety with language that explicitly states whether a private cause of action exists. However,
Congress also has the option to not act and allow the courts to interpret the SCRA, as they have in
the past, with the possibility that the issue will be resolved by the U.S. Supreme Court.
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The Servicemembers Civil Relief Act: Does It Provide for a Private Cause of Action?
Contents
Introduction ................................................................................................................................ 1
Application of the SCRA in the U.S. District Courts.................................................................... 3
Legal Standard: Finding of a Private Cause of Action .................................................................. 8
Congressional Action .................................................................................................................. 9
Contacts
Author Contact Information ...................................................................................................... 10
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The Servicemembers Civil Relief Act: Does It Provide for a Private Cause of Action?
Introduction
Congress has long recognized the need for protective legislation for servicemembers whose
service to the nation may compromise their ability to meet obligations and protect their legal
interests. During the Civil War, Congress enacted an absolute moratorium on civil actions brought
against soldiers and sailors. During World War I, Congress passed the Soldiers’ and Sailors’ Civil
Relief Act of 1918,1 which did not create a moratorium on legal actions against servicemembers,
but instead directed trial courts to apply principles of equity to determine the appropriate action to
take whenever a servicemember’s rights were involved in a controversy. During World War II,
Congress essentially reenacted the expired 1918 statute as the Soldiers’ and Sailors’ Civil Relief
Act of 1940, and then amended it substantially in 1942 to take into account the new economic and
legal landscape that had developed between the wars. During consideration of the amendments in
the 87th Congress, Congressman Overton Brooks (D-LA) stated,
This bill springs from the desire of the people of the United States to make sure as far as
possible that men in service are not placed at a civil disadvantage during their absence. It
springs from the inability of men who are in service to properly manage their normal
business affairs while away. It likewise arises from the differences in pay which a soldier
received and what the same man normally earns in civil life.2
Congress enacted amendments on several occasions during subsequent conflicts, including 2002
when the benefits of the SSCRA were extended to certain members of the National Guard.3 In
2003, Congress enacted the Servicemembers Civil Relief Act (SCRA) as a modernization and
restatement of the SSCRA and its protections.4
The SCRA is an exercise of Congress’s power to raise and support armies (U.S. Const. Art. I, sec.
8, cl. 12) and to declare war (Art. I, sec. 8, cl. 11).5 The purpose of the act is to provide for,
strengthen, and expedite the national defense by protecting servicemembers, enabling them to
“devote their entire energy to the defense needs of the Nation” by providing for the temporary
suspension of judicial and administrative proceedings and transactions that may adversely affect
their legal rights during military service.6 Forgiving of all debts or the extinguishment of
contractual obligations on behalf of servicemembers who have been called up for active duty is
not required, nor is absolute immunity from civil lawsuits provided. Instead, the act provides for
the suspension of claims and protection from default judgments. In this way, it seeks to balance
the interests of servicemembers and their creditors, spreading the burden of national military
1 40 Stat. 440 (1918).
2 H.Rept. 108-81, at 33 (April 30, 2003) (quoting statement by Congressman Overton Brooks (D-LA) on the floor of
the House during consideration of amendments in 1942 to the SSCRA. 87 Cong. Rec. H 5553 (June 11, 1942)).
3 P.L. 107-330, 116 Stat. 2820 (December 6, 2002) (extending benefits of SSCRA to members of the National Guard
called up by their respective state governors to support federal efforts during national emergencies, including the war
against terrorism).
4 P.L. 108-189, 117 Stat. 2835 (December 19, 2003) (One of the amendments effected by P.L. 108-189 is the change in
the name of the act from Soldiers’ and Sailors’ Civil Relief Act (SSCRA) to Servicemembers Civil Relief Act (SCRA).
The name was changed to the more inclusive SCRA “because soldiers, sailors, marines and airmen are collectively
referred to as “servicemembers” in other statutes” (H.Rept. 108-81, at 35 (April 30, 2003)). Therefore, all of the
historical and legal background of this act makes reference to SSCRA instead of SCRA. For ease of discussion, the
term “SCRA” will be used to refer to both the SSCRA and the SCRA.
5 Dameron v. Brodhead, 345 U.S. 322 (1953).
6 50 U.S.C. app. § 502.
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service to a broader portion of the citizenry.7 In Engstrom v. National Bank of Eagle Lake, the
United States Court of Appeals for the Fifth Circuit acknowledged the balancing required when it
stated “[a]lthough the act is to be liberally construed it is not to be used as a sword against
persons with legitimate claims.”8
Many of the SCRA provisions are especially beneficial for Reservists activated to respond to a
national crisis, but many provisions may be useful for career military personnel.9 One of the
measures that affects many who are called to active duty is the limit on the interest rate that may
be charged on debts incurred prior to a person’s entry into active duty military service. Other
measures protect military families from being evicted from rental or mortgaged property; from
cancellation of life insurance; from taxation in multiple jurisdictions; from foreclosure of property
to pay taxes that are due; and from losing certain rights to public land. In order to receive
protections afforded under the SCRA, servicemembers are generally required to provide notice of
their desire to invoke the protection. For example, with respect to the interest rate limitation, the
servicemember is required to provide written notification to the creditor with a copy of his/her
orders establishing a period of active duty service.10
Individuals and/or entities that violate specified sections of the SCRA may be subject to penalties.
With the exception of the section pertaining to the interest rate limitation in Title II,11 only the
sections in Title III (addressing rent, installment contracts, mortgages, liens, assignments, and
leases) include a penalty provision.12 The provision generally consists of two parts, the first
classifying the violation as a misdemeanor and the second preserving other remedies and rights.
The section addressing evictions, for example, states that a “person who knowingly takes part in
an eviction or distress ... or attempts to do, shall be fined as provided in title 18, United States
Code, or imprisoned for not more than one year, or both.”13 The section further states that the
“rights and remedies provided ... are in addition to and do not preclude any remedy for wrongful
conversion (or wrongful eviction) otherwise available under the law to the person claiming relief
... including any award for consequential and punitive damages.”14
The importance of servicemembers knowing and understanding their rights is evidenced by the
requirement in the act that all servicemembers be provided written notice of their rights by the
Secretary of each of the armed services.15 In the event that a servicemember feels that he/she is
not receiving the statutory protections, the servicemember may request assistance from military
legal assistance officers, civilian lawyers, and in some circumstances the United States
7 For a more in-depth analysis of the SCRA, see CRS Report RL34575, The Servicemembers Civil Relief Act (SCRA):
An Explanation, by R. Chuck Mason.
8 Engstrom v. First Nat’l Bank, 47 F.3d, 1459, 1462 (5th Cir. Tex. 1995).
9 See James P. Pottorff, Contemporary Applications of the Soldiers’ and Sailors’ Civil Relief Act, 132 Mil. L. Rev. 115,
118 (1991) (noting that many protections are ordinarily unavailable to career servicemembers because they enter into
most major financial obligations, such as mortgages, while on active duty).
10 50 U.S.C. app. § 527(b)(1).
11 See Section 207 (Maximum rate of interest on debts incurred before military service) (10 US.C. 50 app. § 527).
12 See Sections 301 (Evictions and distress), 302 (Protection under installment contracts for purchase or lease), 303
(Mortgages and trust deeds), 305 (Termination of residential or motor vehicle leases), 305a (Termination or suspension
of contracts for cellular telephone service), 306 (Protection of life insurance policy), and 307 (Enforcement of storage
liens) (10 U.S.C. 50 app. §§ 531, 532, 533, 535, 535a, 536, and 537).
13 50 U.S.S. app. § 531(c)(1).
14 50 U.S.C. app. § 531(c)(2).
15 50 U.S.C. app. § 515.
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Department of Justice (DOJ).16 The DOJ Civil Rights Division will investigate specific
complaints and, if necessary, institute legal proceedings to protect the rights of servicemembers.
The DOJ Civil Rights Division filed its first lawsuit under the SCRA on December 10, 2008,
alleging a towing company in Norfolk, Virginia participated in unlawful enforcements of storage
liens.17 The act does not specifically state who may bring an application for relief, nor does it
specifically exclude private individuals from filing a cause of action. Most courts considering the
issue have found that a private cause of action exists under the SCRA. However, a recent opinion
from the United States District Court for the Western District of Michigan, Hurley v. Deutsche
Bank Trust Company, disagreed with decisions from U.S. district courts in Illinois, Louisiana,
Oregon, and Texas, and found that a private cause of action does not exist under the act.
Application of the SCRA in the U.S. District Courts
In Moll v. Ford Consumer Finance Company, Inc., the United States District Court for the
Northern District of Illinois held that a private cause of action exists under the provision limiting
the amount of interest that may be charged on debt incurred prior to service.18 Moll, a reservist in
the United States Air Force, was ordered to active duty in support of the Persian Gulf War in
1991. Upon activation, he contacted Ford and requested that the interest rate on his car loan be
reduced from a variable rate of 10.25% to 6% as provided for under SCRA and provided all
documentation requested by Ford.19 Ford failed to adjust the interest rate and continued to charge
10.25% on the loan. Moll filed an action alleging Ford violated the SCRA and received unlawful
interest subject to penalties under the Illinois Interest Act.20 Ford moved to dismiss the action
arguing that Moll failed to state a claim, contending that a private cause of action does not exist
under the SCRA, and that because the loan was secured by a mortgage, the loan is exempt from
the Illinois Interest Act.21
The court acknowledged that a private cause of action is not explicit in the act and turned to a
four-part test, created by the United States Supreme Court in Cort v. Ash,22 to determine if a
private cause of action exists even though it is not expressly provided for in the statute. The Cort
factors are: (1) does the statute create a federal right in favor of the plaintiff; (2) is there any
indication of legislative intent, explicit or implicit, to create or deny a private remedy; (3) is it
consistent with the underlying purposes of the legislative scheme to imply such a remedy; and (4)
is the cause of action one traditionally relegated to state law, so that it would be inappropriate to
16 See The United States Department of Justice, Civil Rights Division, Safeguarding the Rights of Servicemembers and
Veterans website (available at http://www.usdoj.gov/crt/military/index.html).
17 Press Release, Department of Justice, Press Release, Justice Department Sues Towing Company for Violating the
Servicemembers Civil Relief Act (December 10, 2008) (The Justice Department alleges that Earnest Cooper and
Aristocrat Towing located in Norfolk, Virginia violated the SCRA by towing and then selling a servicemember’s
vehicle without a court order. The complaint also alleges that the defendants may have injured other servicemembers
by enforcing storage liens on their vehicles without court orders in violation of the act.) (Press release available at
http://www.usdoj.gov/crt/housing/documents/bc_press_12-10-08.pdf.)
18 Moll v. Ford Consumer Fin. Co., 1998 U.S. Dist. LEXIS 3638 (N.D. Ill. March 16, 1998) (finding a private cause of
action exists under § 526 of the SSCRA, codified at 50 U.S.C. app. § 527).
19 Id. at 2.
20 Id. at 3 (Illinois Interest Act, 815 ILCS § 205/6).
21 Id. (The court dismissed the claim for penalties under the Illinois Interest Act on the basis that the state law does not
encompass violations of Federal Law. Id. at 16).
22 Cort v. Ash, 422 U.S. 66 (1975).
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infer a cause of action based solely on federal law.23 However, the court further stated the
Supreme Court has “retreated from this four-factor approach and has focused primarily on the
legislative intent of the statute – the second factor.”24 The court, focusing on the legislative intent
of the act, the second Cort factor, stated that the interest limitation was “designed to give relief to
military persons called into service.”25 The court determined that the act confers a benefit on a
servicemember that is not otherwise available to private citizens and therefore a private cause of
action must be intended “because otherwise the relief would [be] of no value at all.”26 Finally, the
court addressed the remaining Cort factors and found that the act creates a federal right in favor
of Moll; the interest rate limitation is consistent with the purpose of the act to provide
servicemembers with relief in meeting their financial obligations; and that it is not an area of law
traditionally relegated to state law, rather it is grounded in Congress’ right to raise and maintain
armed forces of the United States.27 Finding a private cause of action with respect to the interest
rate limitation section of the act, the court denied Ford’s motion to dismiss.
The United States District Court for the Northern District of Texas, in Marin v. Armstrong,28
found an inferred private cause of action in two separate sections of the SCRA. In Marin, the
servicemember claimed that as a result of illness from military service he was unable to fulfill his
obligations on debt he owed for the purchase of a car.29 He alleged that he informed TranSouth,
the holder of the loan, of his inability to make payments on the obligation and requested that they
toll his obligation until his health allowed him to make payments.30 Marin further alleged that
TranSouth not only failed to toll his obligation, but that it continued to violate the SCRA by
harassing him, sending collection letters, and taking adverse credit action against him.31
TranSouth moved to dismiss the action on the basis that the SCRA does not provide for a private
cause of action, rather it provides only defensive relief for servicemembers, and that even if it did,
Marin is not entitled to relief because the act does not relieve him of his duty to make payments
on the obligation.32
The court agreed that Marin did not have an automatic right to toll his obligation under the
installment contract, but that after receiving notice of his inability to meet his obligation,
TranSouth was required to seek a judicial remedy in a court of competent jurisdiction and failed
to do so as required by the act.33 The court, citing the rationale of Moll, stated that “Congress
must have intended a private cause of action to exist” to enforce these two sections of the act.34
The court questioned TranSouth’s assertion that the act be viewed as a defensive measure, stating
that if that were the case, a creditor could “simply ignore” provisions of the act and the
23 Cort at 78.
24 Moll at 9 (citing, e.g, Sutter v. Artist M., 503 U.S. 347, 364 (1992); Thompson v. Thompson, 484 U.S. 1274, 1279
(1998).
25 Id.
26 Id. at 14 (quoting 88 Cong. Rec. 5366 (1942)).
27 Id. at 14.
28 Marin v. Armstrong, 1998 U.S. Dist. LEXIS 22792 (N.D. Tex. August 31, 1998).
29 Id. at 2.
30 Id. at 9 (§ 531 of the SSCRA, codified at 50 U.S.C. app. § 532).
31 Id. at 3 (§ 518 of the SSCRA, codified at 50 U.S.C. app. § 518).
32 Id. at 4.
33 Id. at 10.
34 Marin at 12.
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servicemember would be unable to bring a cause of action. 35 The court acknowledged that a
criminal penalty did exist for violations of the act, but that such penalty provided no relief to the
servicemember and that a “result that fails to make the servicemember whole defies the purpose
of the statute.”36 The court further stated that “without a private cause of action there would be no
way for a servicemember to ensure that his rights were protected under the section. Creditors and
insurers could simply ignore the provisions of the section without repercussion.”37
In Cathey v. First Republic Bank,38 the United States District Court for the Western District of
Louisiana found an implied private cause of action under the provision prohibiting a creditor from
changing the terms of credit when the act has been invoked by a servicemember and the provision
limiting the amount of interest that may be charged on debt incurred prior to service. Cathey, a
lieutenant colonel in the United States Army Reserve, alleged that First Republic Bank failed to
lower the interest rate on two separate loans after he was ordered to active duty and that the bank
modified the terms of the credit agreement after he invoked protections under the act. The loans
in question were signed by Cathey and his wife, individually and jointly, to finance the
construction of two gasoline/convenience stores.39 As required by the act, Cathey provided a copy
of his military orders to the bank prior to entering active duty.40 However, the bank continued to
charge an interest rate in excess of the 6%.41 Upon his return from active duty, he demanded a
cash refund of the overpaid interest from the bank and alleged that they would only refund the
interest with additional concessions on the loans.42 The bank refused to refund the overpaid
interest, despite repeated demands by the Catheys, individually and through the armed services,
and proceeded to seize and sell both stores.43
First Republic Bank argued that the Catheys were not entitled to the interest rate reduction
because the loans were signed by each of the Catheys, as well as their corporation, and as such
are not covered by the SCRA.44 The court dismissed this argument and stated: “while it is the
serviceman who is provided interest rate protection under the [SCRA] and not his co-makers, the
result is the same. Interest on that obligation may not be charged in an amount in excess of the
statutory rate of 6% per annum.”45 The defendants also claimed that a private cause of action did
not exist and that, in effect, the SCRA is a right without a remedy.46 The court disagreed with this
claim and instead agreed with and adopted the reasoning of Moll.47 The court, quoting the
plaintiff, stated: “[It] would lead to an absurd conclusion to say that Congress enacted a fairly
elaborate legislative scheme to protect service members in a variety of ways and then throw their
claims out of federal court when they sued to enforce their rights and collect damages when
35 Id. at 12.
36 Id. at 13 (finding a private cause of action under § 531 of the SSCRA).
37 Id. at 13 (finding a private cause of action under § 518 of the SSCRA).
38 Cathey v. First Republic Bank, 2001 U.S. Dist. LEXIS 13195 (W.D. La. August 13, 2001).
39 Id. at 3.
40 Id.
41 Id. at 4.
42 Id.
43 Id. at 5.
44 Id. at 11.
45 Id. at 14.
46 Id. at 17.
47 Id.
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violation of their rights cause them damages.”48 The court declined to determine the proper
remedy for the plaintiffs, as the issue was not before the court, and limited its finding to the
existence of a private cause of action under the SCRA.49
In Linscott v. Vector Aerospace,50 the United States District Court for District of Oregon found an
implied private cause of action for a violation of the prohibition against foreclosure or
enforcement of liens during any period of military service.51 Linscott, a major in the Air Force
Reserve, alleged that Vector Aerospace, a Canadian company doing business in the United States,
violated the SCRA by wrongfully asserting a lien on his property while he was on active duty.52
Vector performed an overhaul on a helicopter engine, and upon completion of the work, Linscott
alleged that the engine work was defective and refused to pay for the work until it was completed
correctly.53 Vector retook possession of the engine and promised a quick turnaround so that a
temporary engine would not be needed.54 However, once Vector had possession of the engine, it
claimed that the work was completed satisfactorily and refused to return the property until the
outstanding bills were paid.55 Linscott provided a copy of his orders to Vector and notified the
company that they were in violation of the act by asserting a lien on his property, but Vector
stated that it was entitled to a lien under Canada’s Repairers Lien Act and that the SCRA did not
apply in Canada.56 The court disagreed and found the act applicable to Vector based on its
assertion of a lien on the helicopter engine while doing business in the United States.57
The court then turned its focus to the question of whether a private cause of action exists under
the section prohibiting foreclosure or enforcement of a lien while the servicemember is on active
duty. The defendant argued that the section does not provide a private cause of action. Linscott
argued that in other cases, courts have found an inferred private cause of action in other sections
of the act, and that the court should find a private cause of action in the section in question.58 The
court cited the reasoning under Moll, Marin, and Cathey as being applicable to the current
dispute.59 The court reasoned that under the Cort analysis, “the most important inquiry ... is
whether Congress intended to create the private remedy sought by the plaintiffs,”60 and that the
“legislative intent factor clearly favors plaintiffs. There is no indication that in enacting and
renewing the Act, Congress intended to create rights without remedies.”61 The court concluded,
after completing the Cort four-part analysis, that a private cause of action exists for a violation of
the prohibition against foreclosure or enforcement of a lien.
48 Id.
49 Id. at 19.
50 Linscott v. Vector Aero., 2006 U.S. Dist. LEXIS 6287 (D. Or. January 31, 2006)
51 Id. at 21.
52 Id. at 6.
53 Id. at 4.
54 Id. at 5.
55 Id.
56 Id.
57 Id. at 13.
58 Id. at 14.
59 Id. at 19.
60 Id. (quoting Suter v. Artist M., 503 U.S. 347, 364 (1992)).
61 Id.
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In Batie v. Subway Real Estate Corp.,62 a servicemember alleged that Subway Corporation
violated the SCRA by evicting him from two commercial spaces while he was deployed to
Afghanistan.63 After obtaining declaratory judgments in the State of Texas courts, Subway evicted
the servicemember from the spaces under lease. Batie filed suit in the federal district court
seeking relief from the declaratory judgments and for compensatory and punitive damages for the
alleged violations of the SCRA. The U.S. district court declined to overturn the state declaratory
judgments, stating “Congress envisioned that state courts—not federal district courts—would
decide claims involving SCRA’s tenant protections during eviction proceedings.”64 The court
interpreted the act to mean that jurisdiction is not exclusive in federal court and that the act does
not compel federal adjudication of all cases implicating the statute’s provisions. Denying the
claim for compensatory and punitive damages, the court referred to the failure of the
servicemember to cite any provisions in the SCRA authorizing damages.65 Further, the court
found that, even if the servicemember maintains the SCRA as a basis for damages, “there is no
provision in SCRA that authorizes a private cause of action to remedy violations of the statute.”66
The servicemember’s claims were dismissed by the court. However, Batie filed a Motion for
Reconsideration citing cases in which courts have interpreted certain sections of the SCRA to
create a private cause of action.67 In light of the precedent cited by Batie’s motion, the court
vacated its earlier decision and reinstated the complaint for further adjudication.68
In contrast, the United States District Court for the Western District of Michigan, in Hurley v.
Deutsche Bank Trust Company,69 stated that “the SCRA affords certain rights to servicemembers,
but a private cause of action is not among them.”70 Hurley asserted multiple violations of the
SCRA and a separate claim of conversion under state law against Deutsche Bank related to the
foreclosure, eviction, and subsequent sale of his primary residence while he was deployed to
Iraq.71 The defendants asserted that the SCRA sections cited by Hurley did not expressly create a
private cause of action, nor could one be inferred because the penalty provisions provide an
adequate means of enforcement.72 Additionally, the defendant argued that the SCRA merely
62 Batie v. Subway Real Estate Corp., 2008 U.S. Dist. LEXIS 11458 (N.D. Tex. February 15, 2008).
63 The servicemember claimed Subway violated the SCRA procedures, in two different proceedings before state courts,
by failing to: (1) properly serve plaintiff; (2) appoint an attorney for plaintiff; (3) notify the court of plaintiff’s status as
a U.S. serviceman or his deployment abroad; (4) apprise plaintiff of the eviction notice; and (5) stay proceedings
pending plaintiff’s return from deployment.
64 Batie at 17.
65 Sections addressing rent, installment contracts, mortgages, liens, assignments, and leases under Title III do contain
language discussing consequential and punitive damages as an appropriate form of a remedy, though none of these
sections would apply to a commercial lease or eviction from commercial space.
66 Batie at 22.
67 See Batie Motion for Reconsideration of Order Dismissing Claims Against Subway Real Estate Corporation with
Prejudice, Civil Action No. 3-07CV-1415M, citing Marin v. Anderson, 1998 WL 1765716 (N.D. Tex. September 21,
1998).
68 Batie v. Subway Real Estate Corp., 2008 U.S. Dist. LEXIS 102539 (N.D. Tex. March 12, 2008).
69 Hurley v. Deutsche Bank Trust Company, 2008 U.S. Dist. LEXIS 80526 (W.D. Mich. September 30, 2008).
70 Id. at 19.
71 The servicemember claimed violations of the SCRA by (1) conducting a foreclosure by advertisement (50 U.S.C.
app. §§ 516(a) and 533(c)), (2) allowing the redemption period to run (U.S.C. app. § 526(b)), (3) evicting the plaintiff’s
family from the property (50 U.S.C. app. § 531)), and (4) selling the property to a bona fide purchaser (50 U.S.C. app.
§ 521(h)).
72 Hurley at 15.
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preserves private causes of action that exist independent of the act.73 The court found that none of
the sections cited by Hurley expressly provided for a private cause of action,74 and turned to the
question whether the SCRA created an implied private cause of action. Relying on Cort, the court
utilized the four-part test for determining whether the statute created an implied private cause of
action. The court held that the “plain language of the SCRA, coupled with instructive case law,
persuades the Court that the SCRA does not imply a private cause of action for damages for
foreclosure, redemption, eviction, or sale to a [bona fide purchaser].”75 The court ruled in favor of
the defendants with respect to claims under the SCRA, but allowed the claim of conversion under
Michigan state law to proceed. Shortly after the decision, Hurley filed a Motion for
Reconsideration, citing the decision by the U.S. District Court for the Northern District of Texas
to vacate its decision in Batie, thereby allowing a private a cause of action under the SCRA to
proceed. In denying the motion, the court stated that Batie, as an out-of-circuit case, was only
instructive and that it was not required to adhere to it then or now.76
While the majority of U.S. district courts that have ruled on the question have found an implicit
private cause of action under the SCRA, the Hurley decision illustrates that the issue is not settled
in federal trial courts. The issue has not been considered by a U.S. court of appeals and therefore
precedent has not been established for the lower courts to follow. It remains unclear how a court
of appeals might resolve such a question.
Legal Standard: Finding of a Private Cause of Action
In the absence of action by federal courts of appeals, the U.S. Supreme Court has not ruled on
whether a private cause of action exists under the SCRA. However, the Court has dealt with the
issue of an implied cause of action under other statutes, and that precedent has guided the district
courts in their determination of whether a private cause of action exists under the SCRA. In Cort
v. Ash,77 the Court addressed the issue whether private individuals have the right to sue for
injunctive relief under 18 U.S.C. § 610, a criminal statute prohibiting corporations from making
contributions or expenditures in connection with federal elections. The Court held that individuals
did not have a private cause of action under 18 U.S.C. § 610 and that the Federal Election
Campaign Act78 authorized the Federal Election Commission to receive citizen complaints in
future disputes. The Court created the four-part test, discussed above. However, in Alexander v.
Sandoval,79 a more recent decision, the Court appears to have abandoned the four-part test in
favor of a single factor analysis. The question in Alexander was whether a private citizen may sue
to enforce regulations promulgated under Title VI of the Civil Rights Act of 1964.80 The Court
held that a private cause of action does not explicitly exist under the statute and that the statutory
intent does not support an implied cause of action.81 The Court stated that statutory intent to
73 Id.
74 Id. at 16.
75 Id. at 17.
76 Hurley v. Deutsche Bank Trust Company, 2008 U.S. Dist. LEXIS 92872 (W.D. Mich November 14, 2008).
77 Cort v. Ash, 422 U.S. 66 (1975).
78 P.L. 92-225, 86 Stat. 3 (February 7, 1972).
79 Alexander v. Sandoval, 532 U.S. 275 (2001).
80 P.L. 88-352, 78 Stat. 241 (July 2, 1964).
81 Alexander at 293.
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The Servicemembers Civil Relief Act: Does It Provide for a Private Cause of Action?
create not just a private right but a private remedy, the second factor of the Cort analysis, is
determinative, and that without it, a cause of action does not exist and that courts may not create
one, no matter how desirable it might be.82 The Court focused solely on the statutory intent, and
not the three other Cort factors, in its determination that a private cause of action does not exist
under Title VI of the Civil Rights Act.
However, it does not appear that the precedential weight and persuasiveness of the opinions of the
district courts finding that a private cause of action exists under SCRA, based upon the Cort
decision, are undermined by the Alexander decision. The district court in Moll, while
acknowledging the Cort analysis, focused on the legislative intent factor in its determination that
a private cause of action exists under the SCRA. The subsequent district court decisions,
discussed above, followed the analysis and rationale of Moll, and thus were arguably following
the Alexander analysis.
Congressional Action
In the 110th Congress, S. 2787, The National Defense Authorization Act for Fiscal Year 2009, was
introduced containing language that, if enacted, would have established a new title addressing
civil liability and enforcement of the SCRA, partially addressing some of the issues raised in the
cases discussed.83 The bill would have authorized the Attorney General to file a civil action in any
appropriate United States District Court when a reasonable belief existed that an individual or
group was engaged in, or has engaged in, a pattern or practice of conduct in violation of the
SCRA. An action could also be filed if a denial of protections raised an issue of general public
importance. The language also authorized judicial relief in the form of monetary damages,
including actual and punitive damages, to a servicemember, dependent, or any other person
protected by the SCRA. The court could also impose a civil penalty to “vindicate the public
interest.” While the proposed language did not explicitly state that a private cause of action
existed under the SCRA, it did provide for intervention by private citizens when the case had
been filed by the Attorney General. The bill stated that damages, including actual and punitive
damages, are authorized forms of relief in a civil action filed by the Attorney General. It is
unclear if courts would construe this to mean that damages are available for all violations of the
SCRA, not only those under Title III, through a private cause of action.
The split in the U.S. district courts creates uncertainty in how the act may be enforced in the
future. In many jurisdictions across the country it may be unclear whether a servicemember has
the right to bring a private cause of action for violations of the SCRA. This ambiguity is likely to
persist if the courts continue to reach different conclusions on the right to bring a private cause of
action. The current ambiguity provides options for Congress. Congress may provide guidance to
the courts by clarifying the purpose and intent of the act. A bill introduced in the 110th Congress
would have done so. Or Congress may want to amend individual sections of the act, or the act in
its entirety, with language that explicitly states whether a private cause of action exists. However,
82 Id. at 286.
83 S. 2787, 110th Cong., 2nd Sess., § 541 (2008) (Senator Levin stated, for himself and Senator McCain, “As is the case
with any bill that is introduced by request, we introduce this bill for the purpose of placing the administration’s
proposals before Congress and the public without expressing our own views on the substance of these proposals. As
chairman and ranking member of the Armed Services Committee, we look forward to giving the administration’s
requested legislation our most careful review and thoughtful consideration.” 154 Cong. Rec. S 2234 (March 31, 2008)).
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Congress also has the option not to act and allow the courts to interpret the SCRA, as they have in
the past, with the possibility that the issue will be resolved by the U.S. Supreme Court.
Author Contact Information
R. Chuck Mason
Legislative Attorney
rcmason@crs.loc.gov, 7-9294
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