Bankruptcy and Diligence etc (Scotland) Bill: Stage 2
Our final item is day 7 of consideration of the Bankruptcy and Diligence etc (Scotland) Bill at stage 2. I welcome Allan Wilson, the Deputy Minister for Enterprise and Lifelong Learning, and his civil service colleagues. It is as if we have never been away.
Section 192—Arrestment in execution
Amendment 445, in the name of the minister, is grouped with amendments 446, 448 to 453, 456, 463 and 471.
It is a pleasure to be back. The amendments in this group are all minor changes intended to clarify the effect of part 10 of the bill on arrestment and furthcoming. Amendment 445 changes a regulation-making power to an order-making power. The effect is that, should Scottish ministers decide in future to change the definition of "decree" or "document of debt" for more than one diligence including arrestment, they need make only one instrument.
Amendments 446, 451, 463 and 471 are minor technical amendments that will provide better consistency in terminology between bill provisions that insert text into the Debtors (Scotland) Act 1987 and the existing provisions of that act. Amendments 448 and 456 remove superfluous references to documents in two sections of the bill, because judicial interest is not charged on an arrestment under a document of debt.
Amendments 449 and 450 improve the format of the provisions setting out application of the protected minimum balance by changing a negative condition into a positive one. Amendment 453 clarifies the intended effect of new section 73F(4) of the 1987 act to make it clear that that section applies both to funds and to moveable property so that, on an arrestment, the arrestee must disclose the nature and value of both or either type of property where attached.
I move amendment 445.
Amendment 445 agreed to.
Amendment 446 moved—[Allan Wilson]—and agreed to.
Amendment 447, in the name of the minister, is grouped with amendment 484.
The amendments continue the process of reforming the debt advice and information package, and extending the use of the package to other diligences. The committee agreed the principle behind those changes at its meeting on 3 October. Amendment 447 therefore extends the provision of the package to arrestment in execution. In this case, the package must be provided within 48 hours after an arrestment in execution, or notice to the debtor of the conversion of an arrestment on the dependence into an arrestment in execution. Unlike most other diligences, the debtor is not given the package in advance as it is all too easy for a debtor to move funds out of harm's way. Advance notice would be particularly unfair to the creditor.
Amendment 484 is a minor amendment that provides a new definition of the package in the general interpretation section of the Debtors (Scotland) Act 1987.
I move amendment 447.
Amendment 447 agreed to.
Amendments 448 to 450 moved—[Allan Wilson]—and agreed to.
Amendment 273, in the name of Michael Matheson, is grouped with amendments 316, 443 and 444.
Members will recall the discussion and evidence at stage 1 in relation to concerns about the possibility that state benefits and tax credits might be subject to arrestment under the present provisions of the bill. The purpose of amendment 273 is to exempt from bank arrestment moneys paid into a bank account that are derived from state benefits or tax credits. Under the existing social security and tax credits legislation, state benefits and tax credits are meant to be unarrestable. In practice, however, because of how banks operate, they can be arrested. That is largely because banks consider that once the money has entered the account, it is no longer a benefit, but a sum that the bank is holding for the account holder. It is therefore no longer protected from arrestment.
I accept that under the present proposals the protected minimum balance of £370, which will be unarrestable, is significant progress on where we are at present, where there is effectively no protection. That can result in families being left for the weekend or longer without any money. However, when a benefit or a tax credit payment exceeds the £370 threshold, under the new proposals the money can still be arrested. That affects three groups in particular, one of which is those in receipt of housing benefit or the new local housing allowance, much of which is increasingly paid into an individual's bank account. Arrestment puts them at risk of eviction. The second group is those in receipt of disability benefit—benefit that is often designed to pay for the increased costs of living with a disability, including payment to carers. The third group is those in receipt of the child care element of tax credits, where arrestment could jeopardise child care arrangements and in some instances could create problems for someone's employment.
As it stands, there are three sources from which benefits can be paid: the Department for Work and Pensions; HM Revenue and Customs; and local authorities. As their benefits and tax credits are paid into people's accounts, I believe that it is reasonable to devise a way in which those payments can be readily earmarked or tagged so that they are identifiable in someone's account and are unarrestable.
It is important to recognise the purpose behind amendment 273. It is to try to protect some of the potentially most vulnerable individuals in our society. I hope that members will consider supporting the amendment.
I move amendment 273.
I welcome Jackie Baillie to the committee, and I ask her to speak to amendment 316 and the other amendments in the group.
Michael Matheson has put forward the main arguments in relation to amendment 273. Although my amendment 316 is positioned on a slightly narrower basis, I support the principle of Michael Matheson's underlying position, as well as of amendments 443 and 444, which were lodged by my colleague, Christine May.
The purpose of amendment 316 is to exempt moneys in a bank account that are housing benefit payments from any form of arrestment. Like Michael Matheson, I acknowledge that the protected minimum balance of £370 is helpful. In some cases, however, notably with families, the housing benefit payment will exceed that minimum balance. The consequence of that could be to cause homelessness through the threat or actuality of eviction.
Michael Matheson is right to say that the direction of policy travel is to pay housing benefit into bank accounts. That approach is being piloted in Edinburgh, where money in the form of a local housing allowance is paid directly to the tenant. Housing benefit or the local housing allowance, as it will become, is paid by local authorities, and it is quite easy to identify. I know from what the Executive has told us before that, following discussion with the banks, it believes that the measures will be difficult and costly. I am slightly curious about that. The last time I looked at my bank statement, it was easy to identify child benefit coming through. If the banks can perform the task using unique identifiers, one would have thought that, in this age of new technology, such an operation would not be beyond them. I am not convinced that that is too difficult.
I am absolutely convinced, however, that the Parliament should avoid passing any legislation that has the unintended consequence of contributing to homelessness. In a spirit of generosity, I look forward to coming to the minister's amendments 458 and 480, which I think do what we want done by another means.
I will not repeat what my colleagues have said, as it applies equally to my amendment 443 and the framework in which it is couched. Amendment 443 proposes a procedure called an arrestment restriction order. Following a bank arrestment, a debtor will be able to apply to the court, requesting that the arrestment be restricted to moneys in the bank account other than social security benefits and tax credits. The debtor will be given the opportunity to explain their financial circumstances. If the sheriff agrees that the moneys concerned are either state benefits or tax credits, they will have no discretion on the matter and will have to make an order releasing those sums. That procedure means that the relevant sums would be identified by the debtor and that no administrative procedure would be involved on the part of the banks. The sheriff's order would decree the amounts that would be required to be released from the arrestment.
Like my colleague Jackie Baillie, I believe that the minister's amendments, which we will deal with later, go some way towards dealing with the matter. I look forward to raising issues on those amendments when the time comes. The general principle that Jackie Baillie, Michael Matheson and I have all tried to advance is that benefits that are identified for specific purposes, usually to support families or sustain someone in the home, should be free from arrestment wherever possible.
I understand the concerns that have led to the amendments lodged by Michael Matheson, Christine May and Jackie Baillie. Arrestment is a well used diligence. In 2003, there were 155,432 arrestments, most of which were bank arrestments. As members have pointed out, in many cases, social security or tax credit awards are paid into bank accounts and, given the large number of arrestments, it follows that bank accounts that include funds derived from such payments will often be frozen.
Some stakeholders believe that section 187 of the Social Security Administration Act 1992 and section 45 of the Tax Credits Act 2002 are intended to protect state benefits from diligence, including bank arrestment. However, whatever their intention might have been, it is not clear whether the two sections have that effect. As the issue is reserved, the Executive cannot deal with it directly, but I am able to ask the UK Government whether it intended to protect state benefits from arrestments in the way claimed. I will write to my counterpart at Westminster, seeking an explanation of the UK Government's position on the issue.
I agree that something needs to be done. Although, as everyone acknowledges, the new protected minimum balance will be a big help to many people, there will still be cases in which an arrestment will have an unduly harsh effect. We need to go further. As a result, the Executive has lodged its own amendments, which will be debated later today. I am happy to answer questions about the content of those amendments either now or later—whichever is more appropriate.
However, I do not agree that the amendments in this group offer the right solution to the problem that needs to be fixed. Indeed, I am sorry to say that they raise various practical and legal problems.
One practical problem is that, if agreed to, amendments 273 and 316 will put an unnecessary burden on the banks, which will have to identify benefit payments coming into accounts. I have some sympathy with Jackie Baillie's argument that that would not be the hardest task in the world for them; however, they would have then to track those payments over days and weeks. I understand that that process is more convoluted and would cost the banks both time and money. In those circumstances, I would not expect the banks to do other than pass that cost on to customers directly in the form of higher charges or—worse—indirectly by making it harder for some people to get bank accounts in the first place. I realise that amendments 273 and 316 have not been designed with that end in mind, but there is a danger that it could be an unintended consequence.
Another practical problem is that the amendments will help only individual debtors receiving social security or tax credit payments. They will neither help low income debtors who are not in receipt of benefits, nor allow a case-by-case consideration of the circumstances of individual benefit claimants. Those difficulties were flagged up by the convener at stage 1 and are reflected in the recommendations of the committee's stage 1 report.
For those reasons, I have lodged the amendments that I have already mentioned, which seek to give the debtor the right to challenge an unduly harsh arrestment and a third party with a common interest in funds the right to argue that their share should be released.
I will say more about those changes when our amendments are debated but, if agreed to, they would, for example, enable a wife to challenge the arrestment of a joint bank account for the personal debt of her husband—and, indeed, vice versa.
Furthermore, all the amendments in the group are legally flawed, because their purpose is to protect social security payments and tax credit payments either from arrestment or from the effects of arrestment. Such payments are part of social security law, which is reserved under head F1 of part II of schedule 5 to the Scotland Act 1998. Because the amendments relate to a reserved matter, they are outwith the legislative competence of the Scottish Parliament under section 29(2)(b) of the Scotland Act 1998, which states that a provision cannot be included in an act of the Scottish Parliament if it "relates to reserved matters". Of course, that does not mean that the committee cannot agree to the amendments if it so desires, but it would not be legally competent for the Scottish Parliament to include in the bill the provisions set out in these amendments.
As I have made clear, that is not my sole argument against these amendments. I take on board the sentiments that have been expressed, but I genuinely believe that the Executive's amendments are competent and would be more effective in addressing the concern—which I share—that sheriffs or others might take decisions that are unduly harsh. For that reason, I ask Michael Matheson to withdraw amendment 273 and Jackie Baillie and Christine May not to move their amendments.
I ask Michael Matheson to sum up and to indicate whether he intends to press or to withdraw amendment 273.
I want to pick up on what the minister and Jackie Baillie have said. I agree with Jackie Baillie that the practicalities of tagging benefits that go into bank accounts should not be beyond us. It is perfectly reasonable to expect that that could be done. When a range of benefits are paid into a bank account, they often have the national insurance number alongside them. I understand the concerns that some banks may have about the proposal, but where there is a will, there is a way. In an electronic age, that is a perfectly reasonable expectation.
The minister's second point was about tracking benefits. According to the principle of Clayton's case, first the amount of money that is benefit is calculated and the amount that is left can be arrested. Given that there is case law on that process, there should be no need to track benefits within bank accounts.
I would understand the minister's argument that the amendments relate to reserved matters if we were attempting to amend a piece of legislation on a reserved matter, but we are not—we are dealing with diligence, which is a devolved matter.
I understand and recognise the intentions behind Executive amendment 480, but it is a bit like the ambulance waiting at the bottom of the cliff, in that debtors will have to take the necessary action themselves. I would prefer to put the fence at the top of the cliff to prevent them from getting into difficulty in the first place. That is why I intend to press amendment 273.
The question is, that amendment 273 be agreed to. Are we agreed?
No.
There will be a division.
For
Baird, Shiona (North East Scotland) (Green)
Matheson, Michael (Central Scotland) (SNP)
Neil, Alex (Central Scotland) (SNP)
Against
Baker, Mr Richard (North East Scotland) (Lab)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gillon, Karen (Clydesdale) (Lab)
May, Christine (Central Fife) (Lab)
The result of the division is: For 3, Against 5, Abstentions 0.
Amendment 273 disagreed to.
I will not move amendment 316 in favour of the minister's amendments on the basis that they represent the paramedic at the top of the cliff rather than the ambulance at the bottom.
Amendment 316 not moved.
Amendments 451 and 452 moved—[Allan Wilson]—and agreed to.
I will not move amendment 443 for a reason that is similar to Jackie Baillie's. My paramedic and my ambulance are together, waiting to see where they are most needed.
Amendment 443 not moved.
Amendment 453 moved—[Allan Wilson]—and agreed to.
Amendment 454, in the name of the minister, is grouped with amendments 457, 460 to 462, 464 to 466 and 468.
As I have said, arrestment can freeze common property, such as a husband and wife's joint bank account, for the debt of only one party. In addition, mistakes can happen and an arrestment may freeze in error property that belongs to someone other than the debtor. The law allows anyone who claims that all or part of the arrested property belongs to them to raise a court action known as a multiplepoinding.
At a multiplepoinding the court will want to hear from anyone with an ownership interest, but if it agrees that the claim is a good one, the property will be released as needed. A multiplepoinding is well suited to complex cases with multiple claimants, but it is a slow and expensive way for, for example, a wife to get her share of a bank account released from arrestment.
In other parts of the bill, we allow people who claim ownership of attached property to make a summary application to the courts for release or restriction of the arrestment. The owners of arrested property should have that same right. The amendments in the group will deliver that objective.
Amendment 454 provides that an arrestee must disclose information about arrested property or funds to a third party whom the arrestee is aware has or claims to have an interest.
Amendments 457 and 460 have the effect of suspending the operation of the new provision for automatic release of funds to the creditor if a third party claims partial or whole ownership of attached funds and objects to the court.
Amendment 461 puts part of new section 73K of the Debtors (Scotland) Act 1987 into a new section 73KA, which will deal with the objection process. It also sets out the new third-party right to object to release.
Amendments 462 and 465 are minor changes consequential on other amendments.
The effect of amendments 464 and 466 is to ensure that any notice of objection to automatic release made by someone other than a third party must also be given to a third party with an interest.
Amendment 468 sets out a new ground for objection to automatic release: that the funds attached are owned solely or in common by a third party. That ground can be relied upon by any objector.
I move amendment 454.
Amendment 454 agreed to.
Amendment 455, in the name of the minister, is grouped with amendments 459, 481 and 482.
The amendments in the group will clarify the way in which the bill deals with mandates.
The typical mandate is a written instruction by the debtor telling the arrestee to release the attached property to the creditor. Mandates have grown up over the years as an informal way of getting round the fact that arrestment is a freeze diligence and that the only way to release funds provided by existing law is a decree in an action of furthcoming.
In most cases no one wants to go to the trouble and cost of a new court action. The debtor is willing to release the attached funds and the arrestee merely wants some reassurance that there will be no claim against them for doing so without a court order.
The mandate provides that reassurance. It is a useful tool that can accelerate automatic release, so new section 73N of the Debtors (Scotland) Act 1987 act will put the practice on a statutory footing.
Amendments 455 and 459 make it clear that a bank can act on a mandate to accelerate the automatic release process under section 73H of the 1987 act.
Amendments 481 and 482 take out the references to the debtor in section 73N of the 1987 act. That is to reflect the fact that a mandate can also be signed by a person with an interest in the fund who is not the debtor, for example a joint account holder who does not object to the creditor being paid.
That will enable the new law to be consistent with current good practice. For example, it will be possible to use the power in section 73N to reflect the fact that an attached fund should only be released if all joint account holders sign a mandate.
I move amendment 455.
Amendment 455 agreed to.
Amendments 456 and 457 moved—[Allan Wilson]—and agreed to.
Amendment 458, in the name of the minister, is grouped with amendment 480.
No one enjoys having their property seized by a creditor and taken away to pay a debt, but both creditors and debtors have rights. People who can pay their debts must be made to do so, and diligence must be tough enough to be effective. Toughness is one thing, but harshness is another. Therefore, there should be a fair balance between debtors and creditors during all stages of diligence, and undue harshness should be addressed. As I have said before, the provisions on arrestment in the bill require some modification to deliver that objective better.
The amendments will enable the sheriff to maintain that fair balance by giving the court the power, on application by the debtor, to order that an unduly harsh arrestment will cease to have effect wholly or partially in any case. When funds belonging to a debtor who is an individual are attached, the court will be able to take account of undue harshness not only on the debtor, but on the debtor's spouse, partner or children.
Amendment 458 provides that arrested funds belonging to an individual will not be paid to the creditor under automatic release when the court is asked to make an order in respect of an unduly harsh arrestment. Amendment 480 enables the court to make an order that such an arrestment will cease to have effect in whole or in part and that all or an appropriate amount of the funds or moveable property attached by the arrestment will be released to the debtor.
In considering an application, the court is required to have regard to all the circumstances of the case. Therefore, the amendments are much wider in scope than the amendments on arrestment of benefits and tax credits that we debated earlier. For example, the court can take into account the effect on the debtor of a "double diligence". I know that the committee has a long-standing concern about the harshness that is experienced by debtors whose income is arrested and who then pay their protected income into their bank only to find that what is left is then frozen by an arrestment.
Importantly, the court must also take into account the source of funds in an individual's bank account when it is arrested. Therefore, in the case of a debtor who is in receipt of benefits or tax credits, the court will require to consider the effect of the arrestment on the debtor and the debtor's close family. The court will also be able to consider whether an arrestment is unduly harsh on debtors who are on low incomes or who are in particular financial difficulties and are not eligible for state benefits.
The amendments deliver the necessary improvements that lie within the power of the Parliament. They offer a pragmatic solution that caters for all the circumstances in which an arrestment causes undue hardship, not just the circumstances that are covered by the amendments that we debated earlier. To extend the ambulance analogy, I suggest that this is a national health service community health provision rather than an accident and emergency service. The amendments also bring the changes to arrestment into line with similar debtor protections in other parts of the bill, including money attachment and land attachment.
I move amendment 458.
I seek assurances from the minister on several points. If assurances cannot be given to the committee today, I hope that the points that I raise will be taken on board and considered for stage 3 amendments.
First, I hope that the agreement that lay representation will be available in cases of sequestration will also extend to this provision and that applications will be fast-tracked so that there is no undue delay. I take the point that Michael Matheson made about people discovering on a Friday afternoon that no funds are available for the whole of the weekend.
Secondly, I seek reassurance that the court procedure will be free to the debtor. The procedure is intended to protect debtors and it would be ironic if it incurred a charge.
Thirdly, I ask for reassurance that the intimation of the order will be free to the debtor. I understand that similar provisions have meant that if a sheriff clerk intimates an order, it is free but that if sheriff officers are used, a charge is incurred.
Those are the key points on which I seek reassurance.
I know that other members are seeking clarification, but I think that it would be easier for the minister to deal with members' points as they arise. Are you happy with that, minister?
Okay. That is fine. The new process is designed to be a fast-track, simplified procedure. We will have to look at the court rules in relation to the process, but that is the intention.
Christine May's amendment 443 says that a debtor who applies for her proposed arrestment restriction order can be supported by a lay representative. That is a good idea. A debtor could struggle to explain their case in such intimidating circumstances. No matter how good that case is, it might be hard to find a lawyer who can go to court for them. We should make it possible for an advice worker to help the debtor to make an application of this kind. Therefore, I propose to lodge an amendment at stage 3 that will make it possible for court rules to set out the circumstances in which a lay representative can appear in court in arrestment cases. That is a little bit different from what is proposed in amendment 443, but it is consistent with provisions in other acts, including section 43 of the Debt Arrangement and Attachment (Scotland) Act 2002, and I hope that members will agree that it meets the aim of empowering the debtor in what might otherwise be intimidating circumstances.
And on the potential cost to the debtor?
I will look at that in context.
I have two points of clarification and a suggestion. Will you confirm that legal aid will continue to be available? We would all acknowledge that not everyone will necessarily go through an advice agency, however much we might want them to. Further, could you confirm, for the record, that the Executive specifically regards the arrestment of benefits to be unduly harsh?
My suggestion is based on the fact that, given that the courts need to take account of the source of the funds, somebody somewhere is going to have to identify them. Perhaps, in this new age of technology, the minister will commit to working with the banks to ensure that, at some point in future, we have in place a policy that enables that to happen.
Minister, would you like to deal with those specific points?
On the arrestment of benefits or tax credits, I say, for the avoidance of doubt, that the court will be required to consider any unduly harsh effect on the debtor and the debtor's close family.
What was the first point that you asked about?
Will legal aid still be available?
Yes. People will need to apply for legal aid and acceptance of the application will depend on the circumstances.
And what of my suggestion, which I was hoping to tantalise you with? Given that courts will have to identify the source of the funds, a means of doing so will have to be found. One wonders whether, in this age of new technology, you might make a commitment to working with the banks to consider developing a system of doing so.
We will consider the issue, which we have been discussing with the banks. I understand that their position is that the debtor could get the relevant information from them and take it to the courts. If there is a technological way of accelerating or simplifying the process, we would be happy to discuss it.
So, Jackie has tantalised the minister.
Excellent.
Would you like to sum up, minister?
I think that we all share a common purpose in this regard. We are all here to help to deliver legislation that is fit for purpose and which assists debtors and creditors in a fair and just manner.
Amendment 458 agreed to.
Amendments 459 to 466 moved—[Allan Wilson]—and agreed to.
Amendment 467, in the name of the minister, is grouped with amendments 476 to 478.
The amendments in this group clarify new sections 73K(3)(a) and 73M that section 192 inserts into the Debtors (Scotland) Act 1987 to provide consistency with other parts of the bill. They make clear the difference between what is invalid and what is incompetent or irregular in respect of arrestments and warrants for arrestment in certain circumstances.
A warrant for arrestment is either valid or invalid—for example, a warrant that is granted against the wrong debtor is an invalid warrant—and the arrestment itself might be incompetent or irregular. Those categories cover issues that are wider than formal validity. For example, an arrestment on an invalid warrant would be incompetent, but so would an arrestment in a case in which the creditor has failed to provide the debtor with a debt advice and information package.
Although the distinctions are technical, they are clearly important, as invalidity, incompetence and irregularity are all grounds on which a debtor can object to the automatic release of attached funds. Amendment 467 clarifies the drafting in new section 73K(3)(a), which provides further procedure for people who wish to object to automatic release. Amendments 476 to 478 clarify the drafting of new section 73M, which provides that an arrestee who acts in good faith is not liable to the debtor for loss that is caused by the automatic release of attached funds.
I move amendment 467.
Amendment 467 agreed to.
Amendment 468 moved—[Allan Wilson]—and agreed to.
Amendment 469, in the name of the minister, is in a group on its own.
Amendment 469 is intended to ensure that objections to automatic release, common-law court remedies such as a multiplepoinding or a furthcoming and hardship applications all work together. That will reduce the overlap between different rights and limit the number of cases in which more than one application is made to the courts. The amendment will limit the circumstances in which any person, whether they are the holder of the funds—the arrestee—the debtor or a third party with sole or common ownership claims, can object to automatic release and raise a separate court action about the same property.
Two exceptions to that general rule are set out in the amendment. The first is that an objector may be a party to another action if someone else has raised it, as it would be unfair to prevent them from defending their rights in that action. The second is that the objector may raise another action if the court decides to suspend the objection application. We are proposing an amendment—which is to be debated in a later group—to give the court power to suspend an application when appropriate.
Amendment 469 provides that a debtor who objects to automatic release can also apply to the sheriff for an order for release of arrested property on the ground that it is unduly harsh. If appropriate, the sheriff may deal with the objection and the hardship application at one hearing.
I move amendment 469.
Amendment 469 agreed to.
Amendment 470, in the name of the minister, is grouped with amendments 472 to 475.
The committee has already debated the amendments that are intended to provide a quick route into court for any third party who claims ownership of attached funds by objecting to automatic release under new section 73H of the Debtors (Scotland) Act 1987. The amendments in this group will change new section 73L of that act, which provides for hearings on a notice of objection. If agreed, they will ensure that the court is able to take due account of competing claims to the attached fund.
Amendment 470 paves the way for amendment 474. It makes subsection (1) of new section 73L of the 1987 act subject to proposed new subsection (3A), which amendment 474 will introduce.
Amendment 472 provides for all persons with an interest in the attached fund to be able to make their case to the court if they wish.
Amendment 473 clarifies that the sheriff can still order the release of attached funds if the objection application is rejected after the 14-week period for automatic release under new section 73H.
Amendment 474 has the effect that the sheriff will suspend proceedings on an objection when an action of multiplepoinding or other court proceeding is more appropriate or is raised by someone who has not objected to automatic release. That will allow complex issues to be resolved through a more appropriate procedure.
Amendment 475 provides for intimation by the objector of any orders made by the sheriff under new section 73L and for any objector to be able to appeal to the sheriff principal on a point of law within 14 days of any decision of the sheriff on the objection application.
I move amendment 470.
Amendment 470 agreed to.
Amendments 471 to 478 moved—[Allan Wilson]—and agreed to.
Amendment 479, in the name of the minister, is grouped with amendment 483.
Arrestees hold funds or property that is frozen by an arrestment. They are not party to any dispute between the creditor and the debtor and therefore may not know if, for example, an arrestment is invalid due to a mistake in a court decree. However, debtors are entitled to claim damages for any loss that they suffer if funds or property are released when they should not have been.
It would be unfair to arrestees to hold them responsible for something about which they may not have known, but that does not affect any right that a debtor may have to seek redress from a creditor. The bill protects arrestees who act in good faith from claims for loss by debtors if attached funds or property are released to creditors when they should not have been. It does not protect arrestees from similar claims by third parties with an interest in attached funds or property but it should. Therefore, amendment 479 extends to claims by third parties the good-faith protection for arrestees against claims by debtors following payments to creditors under automatic release, and amendment 483 extends to claims by third parties the good-faith protection against claims by debtors if funds are paid or property is released to creditors under a mandate.
I move amendment 479.
Amendment 479 agreed to.
Amendments 480 to 483 moved—[Allan Wilson]—and agreed to.
Section 192, as amended, agreed to.
That concludes consideration of amendments for today and concludes our meeting. I will see members next week.
Meeting closed at 17:02.