Chamber and committees

The Contract (Formation and Remedies) (Scotland) Bill, which implements recommendations made by the Scottish Law Commission in 2018, is concerned with contract law—specifically, the formation of contracts and what happens in certain contexts if the terms of a contract are not met.

Contract law is important to our everyday economic life and in all types of transactions. It involves businesses and individuals alike. Many contracts are made and carried through and then become the subject of disputes between parties who have no professional assistance. One of the bill’s principal purposes is to produce legal rules that are clear, certain and accessible, and, like most of the witnesses that the Delegated Powers and Law Reform Committee heard from, I think that that aim has been achieved.

It is important to be clear at the outset that the majority of the provisions in the bill are default provisions—in other words, parties can continue to enter into contracts on their own agreed terms and do not have to follow the provisions in the bill if they do not fit with their circumstances. That reflects the principle of party autonomy, which witnesses and the committee recognised as vital. I should also say that the bill is not a complete codification of the law of contract formation; it largely restates the current law while clarifying doubts that have accumulated over the years.

The main reform in part 1 is the abolition of the postal acceptance rule. Under that rule, a contract may be concluded without one party ever having received communication to that effect. Abolition of that rule has been an SLC recommendation for a long time; indeed, it is a recommendation that has been made a number of times over the past 50 years, and I am pleased to bring forward a provision that will, finally, give effect to it.

Part 2 of the bill deals with some of the remedies for breach of contract. However, it is not a complete consolidation of the law on remedies. The SLC consulted on the issue, but it was clear from stakeholder opinion that there was no appetite for such a far-reaching reform of the law. Instead, the bill reforms parts of the law on the steps that one party can take when the other party has breached its contractual obligations.

I will move on to the law of retention, which is a remedy that is meant to be used by parties to encourage performance of a contract without having to go to court. I wrote to the committee in October to set out my intention to lodge amendments at stage 2 to reform that law, and it is the end result of a period of consultation building on the considered work of the SLC and Lorna Richardson of the University of Edinburgh over the past decade or so.

The law of retention is unclear, and we have an opportunity here to bring much-needed clarity. As there appears to be some doubt among stakeholders whether the retention provisions will be default, I make it clear that it is my intention that those provisions can be contracted out of. That is an important point, and it addresses a number of concerns that were raised by witnesses.

I thank everyone who has contributed to this afternoon’s debate. I repeat my thanks to the Scottish Law Commission for the work that has gone into this project and the Delegated Powers and Law Reform Committee for its work in scrutinising the bill.

Contract law is important to our everyday economic life, and the bill will modernise important parts of the Scots law of contract while clearing up doubts that have arisen over a few years. It is clear from today’s debate that there is widespread support for the general principles of the bill.

I will touch on a few issues that have been raised today. On electronic communication, section 13 provides a general principle on when a notification, such as an acceptance, reaches another party. The provision is deliberately broad and flexible because it has to work in a wide range of circumstances and be capable of application to future technologies. I am pleased that the Delegated Powers and Law Reform Committee agrees with the approach that is taken in section 13.

Section 13(4) gives a non-exhaustive list of examples in which it might be considered that a notification has reached the other party. However, in individual cases, that must be measured against the general rule in section 13(3). An automatically generated out-of-office response may make it unreasonable to expect the addressee to be able to obtain access to a notification without delay, and the party sending the notification can forward it to a different email address, if known, pick up the phone or speak to someone. It is, of course, open to parties to make alternative provision during their negotiation, and the bill allows for that.

As members have said, this reform is important. In my MSP capacity, I recently visited Royal Mail in Prestwick and heard first hand all the challenges that it faces. Our hard-working postmen all felt demoralised because all they wanted to do was to deliver for the community, yet post was not being delivered and parcels were being prioritised.

I will touch on Katy Clark’s comments on the need for guidance. Contracts are used widely, and it would be a significant undertaking to publish and maintain guidance that accommodates the breadth of purposes to which contracts are put. For example, the Royal Incorporation of Architects in Scotland has suggested that guidance be prepared for the construction sector, but any such guidance would be of limited value because the standard form contracts for the industry would take precedence over the default rules in the bill.

Yes, and I was going to confirm to Katy Clark that we will be engaging with all stakeholders ahead of stage 2. Mr Whitfield wants a clarification of what engagement is happening with stakeholders. My understanding is that it is on-going, but I will write to him with more detail on that.

Members will be aware that the bill does not affect consumer protections or the protections that are laid out in reserved law. That is expressly stated in section 23 of the bill.

It is clear from the overwhelming majority of stakeholders who submitted evidence at stage 1, and from what has been said in the debate, that reform is needed. The bill will modernise the law and make it more accessible and fit for purpose. There are matters to consider, though, and I look forward to working with the committee on those.

I ask Parliament to support the general principles of the bill. Merry Christmas to everyone.

Yes, we will be considering that, too.

I know that the committee is supportive of the amendments, but it has asked me to look at drafting suggestions. I am willing to do so, and my officials will discuss matters with stakeholders in the lead-up to stage 2.

The final point that I would like to make about the bill concerns transitional provisions. A number of witnesses were strongly of the view that the provisions, if agreed to by the Parliament, should apply to contracts that are entered into after the commencement date, not to contracts that have already been formed. As I told the committee when I gave evidence, I share that view at the moment.

The general practice is to provide for transitional and commencement matters in regulations, and section 25 of the bill provides for those powers. The specifics will be worked out as the final form of the bill becomes clearer, keeping in mind that any amendments might have a bearing on the most desirable approach to be taken here. Overall, having listened to the stage 1 evidence, I am pleased that there is broad consensus on the approach being taken in the bill, and I welcome the committee’s recommendation to agree to its general principles.

I thank the Scottish Law Commission for the considerable work that went into this reform project. In particular, I thank the lead commissioner, Professor Hector MacQueen, for the time and effort that he has given to both the SLC and the Scottish Government; and I thank Lorna Richardson, a lecturer in commercial law at the University of Edinburgh, for her work with us on the general scheme for reforming the law of retention, which we consulted on earlier this year. I also thank everyone who gave evidence to the committee, and the members and clerks of the Delegated Powers and Law Reform Committee for their work in scrutinising this bill.

Finally, I thank Lady Paton, the chair of the Scottish Law Commission, for all her hard work over the past seven years at the commission. Lady Paton has personally overseen work on damages for personal injury and homicide, while working with the Scottish Government to introduce five SLC bills, including this one, in this parliamentary session. Her tenure as chair of the commission has come to an end, and I wish her all the very best in moving forward.

I move,

That the Parliament agrees to the general principles of the Contract (Formation and Remedies) (Scotland) Bill.

The emergencies that the SFRS responds to have changed significantly over the years. For example, the number of dwelling fires has reduced by 20 per cent since 2013. The SFRS chief officer would not make changes to operations that would put the public at an unacceptable level of risk. Those in the SFRS are the experts—we, as politicians, are not—so we should allow them to take decisions on how the service should be best configured.

I was just about to get to that.

I am confident that the bill will make the law more accessible and legally certain than it is at present. I do not feel that guidance from the Scottish Government is needed, which I understood was the majority view that was heard by the committee. The explanatory notes, together with the bill, provide a clear and accessible explanation of what the provisions do. Nevertheless, I have listened to the committee and will write to stakeholders for more information. I will consider the matter further and keep the committee updated.

The Scottish Fire and Rescue Service completed a public consultation on its service delivery review, and an analysis of the responses is currently being conducted. It is important to stress that that analysis is independent of both the Scottish Government and the SFRS and that it will inform the final decisions that the SFRS board takes in 2026.

The purpose of the review is to better align resources to current risks. The SFRS plans to redeploy resources that are freed up by any changes that it makes to provide greater resource to its prevention and protection function, to boost training provision, to ensure that firefighters remain fully ready and competent to keep communities safe from the changing risks that they need to respond to, and to invest in the fire stations that need investment the most.

Yesterday’s letter to the committee set out that the estimated annual cost of the bill would be around £14 million to £19 million in 2025-26 terms. The costs would increase to between £17 million and £23 million in year 5, and the figures are likely to rise annually. As the minister who is responsible for the legislation, I want to ensure that it is affordable and would make a real impact. At this stage, the Scottish Government does not feel that the bill as drafted is worth the costs that have been outlined in the financial memorandum.

I will touch briefly on education, under part 4. As you know, we do not take a prescriptive approach to the curriculum in Scotland. It is very much up to individual schools and local authorities to decide what approaches they use and which external partnerships they build to help them to deliver relevant and engaging learning. The curriculum already includes learning and teaching about domestic abuse, and it places a requirement on Scottish ministers and education authorities that would also create a precedent.

Curriculum for excellence contains learning experiences and outcomes that are designed to ensure that children and young people learn about abuse and power dynamics in relationships. Education Scotland’s website contains a section with domestic abuse information for educators that includes links to various teaching resources. We would be setting a precedent if we were to dictate that there should be specific domestic abuse education in schools.

Good morning, and thank you, convener. First, I acknowledge Pam Gosal’s aim of tackling the horrendous crime of domestic abuse, which is an aim that we all share.

Although violent crime has reduced significantly over the past 20 years, I am, of course, concerned about the increase in incidents of domestic abuse, though I acknowledge that that will reflect increased confidence in reporting and is due to new offences being brought in through the Domestic Abuse (Scotland) Act 2018. I also welcome the fact that the number of convictions has increased, with recent statistics demonstrating that Police Scotland has used those offence powers, further increasing public confidence in reporting domestic abuse.

Tackling domestic abuse remains a focus of the Government, and we will always consider actions that can enable just that. However, as we have set out in correspondence, and as the committee has heard in evidence-taking sessions, we are not sure that the bill will achieve its aims.

On the specific proposals in the bill, we still do not have a clear understanding of how they will interact with existing processes and procedures. That is particularly a concern in relation to part 1.

The committee is aware that those with domestic abuse convictions can already be managed under the multi-agency public protection arrangements—MAPPA—and the disclosure scheme for domestic abuse Scotland, which allows individuals to obtain information and make an informed decision about their situation when they may be at risk in a relationship. Without a clearer understanding of how the bill would interact with those existing programmes, the risk of duplication, competing demands on resources, associated inefficiencies and confusion is high.

Although the concept of a domestic abuse register seems to have been withdrawn, the bill would introduce notification requirements, with the suggestion that being on a list of some description would be a disincentive to offending. As stakeholders have noted—we agree with them—that assertion remains unevidenced, and consequently it remains unclear what added value, if any, the proposal would deliver.

In relation to part 2, the Scottish Government is already investing in the valuable rehabilitation work that is done through the Caledonian system, which uses an integrated whole-family approach to address the domestic abuse of women by men in Scotland. It is important to recognise that the Caledonian men’s programme is a court-ordered programme and that legislation is not required to expand it.

In relation to part 3, although the Scottish Government recognises that more could be done on data collecting and reporting, we consider that that can be achieved without placing statutory duties on Police Scotland, the Crown Office and Procurator Fiscal Service, and charities to request and record data from victims. I have noted charities’ concerns about how onerous that would be for them.

Part 4 of the bill would contradict the discretionary, non-statutory approach to the curriculum that is currently in place in Scotland. Moreover, we have significant concerns about how the establishment of duties on education authorities in relation to the promotion, facilitation and support of domestic abuse education would operate in practice. That remains unclear.

As we have consistently outlined, the Scottish Government remains committed to tackling domestic abuse to ensure that those who perpetrate violence and abuse, the majority of whom are men, change their actions and behaviour, and we are taking a range of actions in that area. We recognise that more can be done, but we do not see the bill’s provisions as being the most effective focus, for the reasons that I have outlined. The bill would involve significant administrative impact and cost, and many of the proposals in the bill are not clear or defined. It is not clear what the bill would provide that would be additional to what we already have.

That leads me to the conclusion that the bill does not strike the right balance in the outcomes that it aims to achieve. Because of that, paired with the costs to public bodies and charities to which it would give rise, the Scottish Government cannot support the bill as it is currently drafted.

I am happy to take questions.

At this stage, I do not believe that the provisions will make victims feel safer. Members will be aware that a range of things are happening in the justice system, including legislative reforms in the Victims, Witnesses, and Justice Reform (Scotland) Act 2025 and the Regulation of Legal Services (Scotland) Act 2025, and we are updating the victim notification scheme. A lot of work is going on throughout the justice system.

My officials might want to add something more specific to answer your question.