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Litigating with a kilt on

Last time we looked at the key differences between English and Scots law when dealing with a contract that is subject to Scots Law.

This time we turn our attention to advising on a dispute that is governed by the Scottish courts. You won’t find many court practitioners or advocates wearing a kilt in the Scottish courts (not least because it is far too cold for that most of the time!), but you may well be bamboozled by the different terminology and rules.

Let’s demystify some of them.

Some of the basics

Starting with the basics, in Scotland the claimant is known as the pursuer, the defendant as the defender.

When it comes to issuing (or “raising”) court proceedings, there is a choice of two courts: the Court of Session or the Sheriff Court. Since September 2015, all claims where the sum in dispute is £100,000 or less must be raised in the Sheriff Court (although it can also deal with higher value claims).

Court actions are either run as ordinary actions or commercial actions. The definition of a commercial action is wide.  Broadly speaking, they include any transaction or dispute of a commercial or business nature.  Construction disputes would usually be classified as commercial actions. This is also the case for adjudication enforcement (of which, more later).

The main difference between the two routes is that commercial actions are normally quicker. However, as not all Sheriff Courts have commercial courts, it may not always be possible to start a commercial action in the Sheriff Courts.

Issuing proceedings, prescription and limitation

As we said last time, prescription and limitation are different. It important to note that in Scotland the prescription clock stops running when the defender has been served with the summons (in the Court of Session) or writ (in the Sheriff Court), not when the court issues it (“signetting”). The summons or writ must be served on the defender, and then returned to the court not later than a year and a day after the date of the expiry of notice. The expiry of notice is 21 days after the date the summons or writ is served on the defender.

Pre-action protocols

In contrast to England and Wales (where pre-action protocols govern most areas of litigation, including construction disputes), pre-action protocols in Scotland are generally voluntary. However, the Court of Session’s Commercial actions protocol (the Protocol), which is contained in a court Practice Note, is mandatory for cases that are designated as commercial actions. There is a requirement on the parties to ascertain their respective positions in relation to the dispute before commencing proceedings. While there is no express requirement for the parties to meet in Scotland, the dispute does require to have been “the subject of careful discussion”.

Also, if the first case conference (which, in a commercial case, is usually held 14 days after the initial defences are lodged), has to be adjourned through non-compliance with the Protocol, the defaulting party may have to bear indemnity-level costs of the adjourned hearing.

Evidence

In contrast to England and Wales (where there are extensive rules on disclosure), there is no obligatory disclosure in Scotland. Instead, parties must apply to the court specifying the documents or category of documents that they require by way of a “specification of documents”. The party said to be in possession of the documents is called the “haver”. The haver may be a party to the dispute or a third party.

If no documents are produced following the service of the specification, then it may be necessary to hold a “commission”, whereby an independent commissioner is appointed to establish by way of witness evidence whether the documentation actually exists.

Privilege is a concept that Scots law recognises, with both legal professional privilege and without prejudice privilege. There are differences with England and Wales, but essentially the first one covers those confidential communications between a client and his lawyer, and the latter one covers communications dealing with the settlement of a dispute.

The rules on witness evidence also differ from England and Wales’ rules. Witnesses are usually required to give full oral evidence at trial (known as a “proof”). Any informal statements (“precognitions”) are inadmissable and formal witness statements will usually remain privileged throughout an action and are not normally disclosed or exchanged. However, the exception to this is in commercial actions where there may be exchange of witness statements or affidavits.

The only usual requirement is to identify the witnesses to be called four or eight weeks prior to the proof.

Other aspects of litigation

Litigators in England and Wales will be familiar with part 36 offers. A “tender” is similar to a part 36 offer, but there is one major difference: a tender cannot be made until proceedings have been raised. There is no fixed time for acceptance of a tender. The pursuer (claimant) is simply allowed a reasonable period to accept a tender. Also, there has never been any requirement to make an actual payment into court.

As in England and Wales, recovery of costs (“expenses”) is at the courts’ discretion but they are, almost without exception, recoverable by the successful party. However, the method of assessment is very different. Generally in ordinary Sheriff Court and Court of Session cases, judicial “accounts of expenses” are required. These are fixed, based on a statutory table of fees.

Of course the usual dispute resolution mechanisms (such as ADR) are available in Scotland, albeit with some differences. Of particular note is the Arbitration (Scotland) Act 2010, which provides a modern statutory framework for domestic and international arbitration in Scotland. The Act takes the best features of arbitration regimes around the world. It should be noted that one of the principal aims of the Act is to bring back arbitration as a cost-effective and efficient method for resolving disputes in Scotland.

Adjudication enforcement

The enforcement of an adjudicator’s decision is also a completely different process to that you may be familiar with in England and Wales.

For example, the party wishing to enforce the adjudicator’s decision will usually raise enforcement proceedings in the Court of Session seeking payment. Just like in England, this may be met with a defence that the decision is unenforceable. That defence will usually ask the court to set aside the decision ope exceptionis. If the defence is successful, this will render the adjudicator’s decision unenforceable but (in contrast to England and Wales), the decision will still exist and will prevent a party from making a further referral of the dispute to adjudication. To avoid this, a party also needs to apply for a “decree of reduction”, which effectively clears the way for a fresh adjudication. It is also not possible to obtain a stay of execution in Scotland. A decision is either enforceable or not.

More to come… ?

There are also vast differences in the criminal legal systems which are beyond the scope of this blog. With further devolution on the cards and greater law making powers for the Scottish Parliament sought, keeping on top of the differences is vital.

BTO solicitors Julie Scott-Gilroy Claire Mills

One thought on “Litigating with a kilt on

  1. For parties litigating in Scotland, from today (27 March 2017), the Court of Session’s Practice Note, No 1 of 2017 applies to commercial actions (which includes building, engineering or construction contracts).

    In addition to exchanging pre-action communications (that is, a letter before action and a letter in reply) and providing copies of documents or experts’ reports (paragraphs 10 and 11), the parties are now required to “consider carefully and discuss whether all or some of the dispute may be amenable to some form of alternative dispute resolution” (paragraph 11). ADR should also be discussed prior to the “procedural hearing”, as the parties will be required to advise the court of the steps taken “to achieve an extra-judicial settlement” (paragraph 20).

    The commercial judges now also have the power to order the parties to hold a joint meeting to discuss settlement and, while such an order “will not be made as a matter of course”, it is likely to be “ordered in most cases” (paragraph 35).

    This all sounds quite familiar to those of us in England who are used to complying with the TCC guide and the construction and engineering pre-action protocol.

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