Justice and Home Affairs Committee, 06 Dec 2000

Meeting date: Wednesday, December 6, 2000

Official Report 199KB pdf

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Petition

Item 3 is petition PE102 by James Ward, which has been before us on more than one occasion. It concerns his sequestration.

After reading the document "Recall of sequestration" and Mr Ward's petition and comments, I am a little concerned. The document acknowledges that sequestrations can be applied under false circumstances, and that was the basis of Mr Ward's original complaint. Even if we leave his case aside, there could be many such cases, and the fact that people have to go to recall rather than appeal leads to concerns about the expenses entailed.

We are talking about people who have virtually no funds at all, and who must be down on their luck, or on their uppers, whichever way you look at it. Those people have first to find a local solicitor, in order to seek the recall, and that solicitor then has to find an Edinburgh agent, at even more cost. The whole thing is extremely costly, so I feel that Mr Ward has hit on a strong point. I would like that point to be made to the minister.

In the Official Report of our meeting on 27 September this year, at column 1803, I suggested that we ask the minister whether jurisdiction could be changed for recall of sequestration. I gave the example of a plumber in Forfar having to go to the Court of Session for recall. Our letter to the minister did not address that, although I blame no one for that. I wonder whether we could now write to Jim Wallace asking why such matters are exclusively within the jurisdiction of the Court of Session and whether there could be a dual jurisdiction so that the sheriff courts could deal with them too. The Forfar plumber could then at least petition for his recall in a local court. As well as being more convenient, that would help him with expense.

I agree with both of you. The "Recall of sequestration" document, which intends to be helpful, has spelled out what a complex and expensive business this is. Paragraph 1.2 says that

"the process is not straightforward"

and paragraph 4 says:

"This makes it an expensive process right away".

As Phil Gallie says, we are talking about an expensive process for someone who has already been sequestrated. For him or her, anything over a couple of quid will be expensive. When the document says expensive, it means really expensive. Christine Grahame suggests that considering such cases in a lower jurisdiction, if possible, would make things a bit easier for people. There are certainly questions to be answered. Are members happy that we write to the minister along the lines that have been suggested?

I would be happy with that, convener. But there is another point worth making. The person who may have been responsible for a mistake is the person who makes the judgment. Mr Ward's letter of 26 November to Mr Wallace says that, on legal issues,

"decisions are taken by the Accountant in Bankruptcy",

which clearly involves

"a conflict of interest for Justice."

There is a question to be asked there, which comes back to the European convention on human rights. I am not raising that today, but I suggest that there is a question mark over a judicial process in which one person is judge and jury.

I am not happy to go along the route of challenging the Office of the Accountant in Bankruptcy, which sits only when a party has been declared bankrupt. My concerns are with the proceedings that lead up to an individual being declared bankrupt, and with what happens if there is some flaw in the sequestration of an individual, some flaw in the procedure or some issue to do with the grounds on which a petition for recall is made—which I do not have to hand just now. We have to allow such matters to be dealt with in the sheriff court. At the moment, the petition and all the papers have to go to the Court of Session for the recall. The process is cumbersome.

I am not unsympathetic towards what Phil Gallie says: I appreciate his point. I am happier with Christine Grahame's point about dealing with recall locally. Having an appeals system for bankruptcy is not without its problems. It is difficult to make a law for some people and not for others, but people go bankrupt in different situations. There is the man who genuinely does not have two pennies and has fallen on hard times; but there is also the man who, for various reasons, is playing the system and quite deliberately avoiding payments and using bankruptcy. We repeatedly read stories in the papers about people who have been bankrupt umpteen times: they are playing the system.

Appeals procedures, because of the nature of court work, are lengthy and cumbersome. If people are made bankrupt, and then use the appeals procedure to block their assets being administered for the benefit of those who should have them, that can go on for months. On the one hand, you have the genuine case that Phil Gallie is interested in; on the other, you have people who use the appeals procedure to play the system and stop creditors getting the money that they should be getting. The way round that may be to consider allowing recall at a local level. That would solve the problem of the Forfar plumber having to go to Edinburgh, and it would stop people playing the system. However, I would say to Phil that the issue is not quite as simple as it would be if there were only the genuine people.

I think that we agree that we want to ask whether the recall procedure could be handled locally and, therefore, more inexpensively. Should we also ask whether there is the potential for a conflict of interests in certain circumstances, as Mr Ward suggested?

Members indicated agreement.