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Eleanor Hamilton

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					 Home Owner & Debtor Protection
(Scotland) Act 2010 – key issues for
       the advice sector, lay
    representatives & solicitors
   Eleanor Hamilton, Principal Solicitor
       Shelter Housing Law Service
   Home Owner & Debtor Protection
        (Scotland) Act 2010
• Amends Conveyancing & Feudal Reform
  (Scotland) Act 1970 & Heritable Securities
  (Scotland) Act 1894
• New provisions relating to enforcement of
  standard securities
• Applies to standard securities over residential
  property
     Court action must be raised
• Sections 1 & 2 – lender must raise court action
  to enforce standard security
• One exception – voluntary surrender
• Action raised as summary application by
  lender lodging Initial Writ at Sheriff Court
             Pre-Action Requirements
•   Lender must certify having complied with PARs and detail compliance
•   Clear information on terms of security, amount due, charges and any other default
•   Made reasonable efforts to agree proposals
•   Has given notice to borrower if default on previous agreement
•   Borrower hasn’t taken steps likely to result in payment of arrears
•   Has provided borrower with information on advice
•   Has encouraged borrower to contact local authority
•   Has had regard to guidance issued by Scottish Ministers
         Initial Court Procedure
• All cases must call in court
• Hearing assigned when application made by
  lender
• Borrower will receive copy of Initial Writ and
  intimation of hearing
• No need for borrower to lodge Notice of
  Intention to Defend or Section 2 Minute
             Court hearing
• If borrower doesn’t attend hearing
  decree not necessarily granted against
  him
• Sheriff can only grant application if
  satisfied that lender has complied with
  PARs and that it is reasonable to grant
  decree
 Court hearing – borrower present
• If borrower attends or is represented at
  hearing he can oppose application.
• Borrower can inform court that PARs not
  complied with
• Borrower can suggest that even if PARs
  complied with is not reasonable to grant
  decree
      Matters for court to consider
•   Nature of and reasons for default
•   Ability of borrower to fulfil obligations within a reasonable period of time
•   Any action taken by creditor to assist borrower
•   Participation by borrower in a debt payment programme
•   Ability of debtor and other residents to secure reasonable alternative
    accommodation
•   Not an exhaustive list
        Further Court procedure
• Sheriff may order Answers
• Sheriff decides how best to proceed in circumstances
  of case
• May fix further hearing after Answers lodged
• May allow time for adjustment
• May continue or sist action
• May fix an evidential hearing
• May grant decree or refuse application
                 Entitled residents
•   Entitled residents to be disclosed in Initial Writ or Answers
•   Sheriff will order Initial Writ to be served on them
•   Can apply to court for an order using form 11E
•   Hearing assigned when application made
•   Sheriff can also order Answers
•   Application and hearing to be intimated to other parties
•   At hearing Sheriff to have regard to same matters as for
    borrower’s first hearing
                 Minute for Recall
•   Done by lodging form 11F
•   Hearing will be fixed on application
•   Application and hearing to be intimated to other parties
•   Decree must be recalled at hearing
•   If applicant doesn’t attend Sheriff will fix peremptory diet
•   Only one application may be submitted by each party
•   Application can only be made if client has not appeared,
    been represented or submitted application in proceedings
          Lay representatives
• Must be an approved lay representative
• Must be able to satisfy Sheriff throughout
  proceedings that suitable person to represent
  borrower or entitled resident and is
  authorised to represent that person
            Legal Aid & Expenses
•   Consider whether client eligible for legal aid
•   May have a contribution to pay towards costs
•   May be a recovery of money/preservation of property
•   Effect of award of legal aid on expenses
•   Advise client about cost implication of opposing
    application
          Transitional Provisions
• Actions raised pre 30 September 2010
• Calling up notice/notice of default served pre 30
  September 2010
• In future cases recall of decree will depend on whether
  decree granted in action raised pre 30 September 2010
  or after

				
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