UK: New Scottish Law Enforcement Proposed

In addition to the Scottish Parliament's search to find a replacement for poindings and warrant sales (the English equivalent of execution) the Scottish law Commission has issued their long awaited report recommending major reforms to diligence (judgement enforcement).

Amongst some of the major proposals is the replacement of the archaic remedy called "adjudication". This little used remedy is used to attach a debtor's land as well as moveable property. The Commission has suggested the introduction of a new diligence of "land attachment" to replace adjudication as a diligence against land.

Land attachment will be a two-stage process. Firstly an unpaid creditor will be able to register a notice of land attachment in the property register. The effect of this will be to secure the unpaid debt over the debtor's land. The second phase of the remedy will permit, in limited circumstances, the actual sale of the land that is subject to the attachment order. There will have to be a six-month gap between the two. However where the debt is £1500 or less it will be incompetent for a sale application to be granted. Nor, in the case where the debt exceeds £1500, will an application be granted where the proceeds of sale are unlikely to generate a reduction of £500 of the debt or 10% of its value.

Obviously creditors will be disappointed the Commission introduced these limiting factors but it is in line with the Scottish Parliament's wish to provide adequate debtor protection which has been much emphasised during the current enforcement debate. This is probably why the Commission have not recommended a dwelling house be included at the sale stage with this being possibly exempt.

The Commission have also suggested the introduction of a new diligence called an "Attachment Order". This would cover such assets as patents, licenses and timeshares. With its introduction some sort of enforcement process will now cover all of a Scottish debtor's property.

So Scots law will shortly be intolerant of any "gaps" in a debtor's assets that could possibly escape the grasp of the greedy creditor - although one wonders practically how useful this diligence will be in practice.

How many debtors owing money following a judgment debt do you know of holding a patent, and if you were lucky enough to find one, how would you have it valued and subsequently disposes of?

Perhaps not so esoteric will be the suggested remedy of "Money Attachment" At the moment cash and cheques in the debtor's possession are not subject to any diligence.

The Commission's report recommends if a debtor's moveable goods can be the subject of diligence then it should also be possible to attach debtor's cash.

Creditors may be forgiven for being a little cynical in suggesting "Money Attachment" may be of little practical value. How many debtors have you come across who had a wad of notes lying around their premises? And if the debtor does happen to have some cash in his pocket this will not do because the Report recommends court officers will not be permitted to search individuals or their handbags or wallets for the money!

Only time will tell, but it is doubted whether this new measure will be seen by creditors as a serious remedy, particularly where ""Money Attachment will be incompetent where the value of the money attached did not exceed the likely total expenses of the diligence plus the lesser of £50 or 10% of the debt.

Hopefully the introduction of "Land Attachment" will be of some use to creditors. However it is doubted even if the Scottish Parliament were to introduce the Commission's report in its entirety whether this would have any significant effect in providing greater effective enforcement north of the border.