In Scotland, the group tasked with enforcing judgments (and some other debts) are Sheriff Officers, or Messengers-at-Arms for the Court of Session. Usually, their role begins once you have had your day in court and been awarded your decree (judgment). However, it is possible on occasion to have Sheriff Officers proceed with enforcement action on the strength of some other documents, such as guarantees or leases. This article will focus on those other documents.
Owing to the fact that these documents often allow someone owed money to proceed directly to enforcement, without going through the court process, it is quicker – hence, ‘summary’ diligence.
There are three hurdles to clear before the creditor in a document (the person owed money) can instruct Sheriff Officers. Firstly, the document must contain a clause to the effect that the parties “consent to preservation and execution”. The effect of the words “and execution” can often be overlooked. Without those words, summary diligence cannot proceed and the creditor would require to raise a court action.
Secondly, the document would require to be probative and registered in the Books of Council and Session. This means that it must be signed in a certain way, which creates the legal presumption that it was signed by the person(s) it says signed. The authority to enforce flows from the registration in the Books of Council and Session. If, therefore, registration is not possible, the creditor would require to raise a court action.
Thirdly, the debt has to be ascertained from the terms of document itself. If this is not possible, the creditor would require to raise a court action. This is where it can get slightly complex.
Often times in these types of documents there will be a clause to the effect that “a certificate signed for or on behalf of the creditor shall, save in the case of manifest error, be evidence of the sum due”. Regardless of what the document says, such a certificate is open to challenge by the debtor. The position appears slightly more difficult where such a clause is missing. How, then, is the creditor supposed to be able to say that the debt can be ascertained from the document?
The answer to this, like may questions in law, is that it depends. To be more precise, it depends upon what the document itself says. In the 2010 case of McLaughlin, Petitioner the Inner House of the Court of Session (the highest civil court in Scotland) examined this area.
The court held that the absence of a clause allowing the creditor to issue a certificate of sums due was not fatal to summary diligence. The question that has to be asked is “what method has been contractually agreed upon by the parties for the instant verification of the sum, if any, due”.
If a document provides that the debtor shall pay certain sums “on demand”, then the demand would be the step that was required to ascertain the debt. There may be stipulations in the document regarding the service of notices etc., and so care should be taken to ensure that these are complied with. The language of the document may mean that only very precise steps actually serve to make the debt ascertainable.
Assuming that the various conditions are satisfied, it is competent to have Sheriff Officers proceed with diligence in a similar fashion as they would following an extract decree. Two common methods of enforcement are a Charge for Payment and a Bank Arrestment.
The Charge for Payment is a formal document served by Sheriff Officers on a debtor that requires them to pay the sum sought within 14 days. Where the debtor disputes the amount of the sum due, or even that any sum is due, they have to raise a petition in the Court of Session. If the debtor does not take either of those steps, the creditor can then take further enforcement action, up to and including bankruptcy.
A Bank Arrestment is only useful if you know details of the debtor’s bank account. The Sheriff Officers will serve a formal document on the bank, and if there is a sufficient level of money in the debtor’s account(s), the money will be frozen. If the debtor wishes to dispute the arrestment they require to raise a Sheriff Court action to object. If the debtor does not react to the arrestment the money is sent to the creditor after 14 weeks.
Notwithstanding the potential complexities of these processes, it is clear that having a document that allows a creditor to carry out summary diligence can speed up recovery of a debt. It may also catch a debtor by surprise where they think that they are safe until a court action is raised.
If you have any questions about enforcing a debt under a document, or are being pursued for such a debt, please get in touch.
Contact our Litigation Lawyers Glasgow, Scotland
This article is for general information only. Nothing in this article should be taken as legal advice. If you have any queries on the content of this article please contact us.
