Millsap & Singer - Court Closure and Moratorium Update (Kansas, Missouri, Kentucky)

• By: ALFN
• On: 03/26/2020 17:28:27
• In: COVID-19

Update to Kansas State Moratorium
On March 24, 2020, Kansas Governor Laura Kelly issued Executive Order No. 20-10 which rescinds the previous Executive Order 20-06 and provides clarity regarding which default actions are permitted and prohibited while the order is in effect. 

Under the terms of the new executive order, no foreclosures of residential property are allowed to be initiated where the default is the result of a financial hardship created by the COVID-19 pandemic (loss of income or increased expenses due to the pandemic and making continued mortgage payments would hinder their ability to purchase other essentials – food, medicine, health/safety services).  This is a significant change from the original order which imposed a blanket prohibition on initiating foreclosure proceedings.  The new Order does place the burden of pleading and proving that the default was not caused by a hardship arising from the COVID-19 pandemic on the foreclosing creditor, but does not otherwise restrict your ability to otherwise file first legal action or otherwise proceed on in-progress foreclosure proceedings.  Because the State of Disaster Emergency in Kansas was declared on 3/12/20 and no shelter in place orders were in effect prior to March in KS, we do not believe that the order should effect matters that were referred this month or prior and, likely will also not apply to loans that may otherwise be ready to refer for foreclosure over the next 2-3 months (i.e., loans with due dates of 2/1/20 and prior at time of referral) as those defaults arguably occurred prior to any in-state economic impact resulting from the COVID-19 pandemic.

This restriction will remain in effect until May 1, 2020 or the date the statewide State of Disaster Emergency is lifted, if earlier.  Please note that while the provisions of the new order will allow foreclosure proceedings on matters already referred (and likely those that may otherwise be referred in the next 2-3 months) to proceed as usual, the ability to move foreclosure proceedings forward will also be subject to the Kansas Supreme Court's separate administrative order restricting court operations and suspending statutory response deadlines.  The effect of the latter order is such that while we can still initiate foreclosure proceedings, on any new lawsuit filed, the debtor's time for response to that suit once served will not begin until after the Supreme Court order is lifted.  In addition to the Supreme Court order, some local jurisdictions have enacted separate orders that may also restrict the ability to proceed to sale and complete other foreclosure milestones; we expect those local orders to be lifted at around the same time that the Governor's and Supreme Court's orders are lifted.

The ability to move referred matters will obviously also continue to remain subject to all announced moratoria from GSEs and Federal agencies.  

Court Closures and Cancellations
Our firm has received notification from the following courts regarding cancellations and closures due to the Covid-19 pandemic.  The list is current as of this blast and updates will be provided as necessary. 

Updated 4/22/20




The firm will be notifying clients on a case by case basis as loans are affected and will place holds as necessary.  Cases requiring an in-person hearing will necessarily result in an uncontrollable delay in the foreclosure process for affected loans.  We will seek to have the matters re-scheduled for the next available court date after normal operations in the jurisdiction resume and will work to schedule phone hearings where applicable and available. Throughout this event, our firm is working diligently to protect our clients' interests and minimize the impact and disruption of service. 

Escalation Contacts

Please contact us at your convenience if you have questions or concerns regarding this matter.

If you have additional contacts you wish to have added to this list please contact kmerckel@msfirm.com.
 
Vernon D. Singer
vsinger@msfirm.com
636-537-0110
 
Kip J. Bilderback
kbilderback@msfirm.com
636-537-0110
314-603-6823 (cell)
 
Cynthia M. Kern Woolverton
ckernwoolverton@msfirm.com
636-537-0110