Chamber and committees

In which case, I will move on to ask about section 49, which I know has already been touched on, at least in passing. It provides that the Scottish ministers may establish by regulations a body with a view to it becoming a category 1 regulator and may specify

“circumstances under which the Scottish ministers may directly authorise and regulate legal businesses.”

The bill states that ministers must obtain the consent of the Lord President before making such regulations and, even then, make them only if they believe them to be necessary as a last resort.

Again, I am interested in your reflections on that delegated power and any other concerns that you have with it that have not already been stated. Do you consider that it is effectively hemmed in?

For absolute clarity, is there nothing that could be done to the section other than to remove it?

That is helpful.

I share that concern, which is something that the committee thought about, and I know that other committee members are also concerned. The landscape is complicated, which is why one of the key recommendations in our report is that good guidance should be available. We recognise that many people who are involved in trusts do so as volunteers or do not have detailed experience or understanding of the law. Anything that the Government can do to provide clarity is really important.

I move to some key issues. Although this is an SLC bill, it is important that the Scottish Government and the minister take ownership to ensure that any concerns or suggested improvements that have come to light through the parliamentary process are acted on, fully considered and, where possible, incorporated into a strengthened final bill. It may be tempting to think that it will all fall back on the SLC or others. However, I am pleased that, as we see in the minister’s response to the stage 1 report, the Scottish Government seems to be taking an active interest in resolving some of the committee’s concerns.

In her remarks, the minister touched on section 65, which is on litigation expenses. I emphasise that the concerns about that, which the committee discusses in its report, continue. The Law Society of Scotland was quite outspoken on section 65 in its written evidence. It stated:

“This is quite a radical provision. There are real issues with the default being that the trustees personally pick up the liability for expenses where the trust property is insufficient unless they can show that would be unfair. This may put people off accepting office and will more than likely be a disincentive for trustees to litigate”.

Section 65 gives me cause for concern on two grounds. First, I am not sure that SLC bills are the place for radical provisions and major departures from existing practice. Secondly, I am concerned about the practical implications that the provisions may have, with individual trustees potentially being left protecting their own financial interests rather than doing what is best for the trust. I understand that there is a fine balance to be struck, but I believe that section 65 needs further work and clarification. I welcome the confirmation that the minister is considering the provisions and I hope that the Government will lodge amendments at stage 2 to make them absolutely clear. I am also keen to understand the evidence on underfunded trusts entering litigation, and to get a sense of how much of a real problem that is at present. I have not seen that or heard any real evidence of it.

I also draw the minister’s attention to section 61 and the 25-year limit. Again, I am pleased that the Scottish Government has welcomed the committee’s recommendation on that, and I understand that the matter is being considered with a view to an amendment being lodged at stage 2 regarding the circumstances in which an application may be made to the court.

Although a range of views were expressed, the committee agreed that, on balance, the 25-year period in the bill is appropriate. However, we stated that we would like a caveat to be added that would allow the court to permit alteration of the 25-year period in exceptional circumstances. That would enable the law to capture, for example, circumstances that were not reasonably foreseeable at the time when the trust was created but which are detrimental to the operation of the trust. That seems pragmatic and it would strengthen the bill.

I also flag up the on-going concerns about incapacity, which were mentioned by the convener and touched on by the minister. There are concerns about how incapacity is defined in the bill and how things will work in practice. I am sure that other members will cover those in further detail, but I am clear that amendments are needed in that regard if we are to have confidence that we have got the legislation right.

I commend the committee’s stage 1 report, which covers those and many other aspects of the bill in much greater detail than I have managed to do in the time allotted today. It is clear that we have an important and much-needed piece of legislation in front of us. I hope that, through stages 2 and 3, we can get to a point where we can all be confident in it.

I begin by apologising to members for participating remotely. I had planned to be in Parliament in person, but I have had flu symptoms and a temperature overnight and felt it best not to bring that to the chamber.

I say at the outset that Scottish Conservatives will support the bill at decision time and that we endorse the Delegated Powers and Law Reform Committee’s report. Although the law affecting trusts may not be at the top of the political agenda, it is clear from the work that has been undertaken by the Scottish Law Commission, the Scottish Government and, latterly, by the committee itself, that, more than a century since the last major reform, modernisation of the law is not only desirable but badly needed and broadly supported.

As it stands, the bill represents a significant step forward, but detailed work is still needed to ensure that the legislation is workable and to address the concerns of key stakeholders. The committee noted that work remains to be done in a number of areas of the bill and was sympathetic to stakeholders’ concerns about parts 1 and 2 of the bill.

More generally, a matter that I pressed the minister on at committee is that there is a feeling in some quarters, especially after having waited 100 years for change, that the bill misses the opportunity to do more, particularly with regard to maximising the codification of trust law. My colleague Stephen Kerr asked the convener why the committee is content to proceed with the bill when those concerns have been raised. One reason for doing so, as Stuart McMillan said, is that starting substantive new work on the bill would have caused delays. There was also strong evidence from a number of witnesses, including the SLC, that some areas of trust law are not settled and that case law is not sufficiently established to support full codification.

I remain keen to see more codification and note that the Law Society of Scotland’s briefing for today’s debate argues that more could be said about the nature and constitution of trusts. Like the Law Society, I would be interested to hear more from the Scottish Government about the other options that it is looking at to take that work forward outside the scope of the bill and, in particular, to define different types of trust. I would be keen to hear more from the minister about that in closing.

I move to some particular issues that need further attention.

Looking beyond the proposed bill on judicial factors, you will be aware that the Minister for Victims and Community Safety recently wrote to Lady Paton, the chair of the SLC, committing Scottish Government officials to undertake “detailed work” on the SLC’s report on an approved scheme for financial provision and cohabitation breakdown, its “Report on Aspects of Leases: Termination” and its “Report on Review of Contract Law: Formation, Interpretation, Remedies for Breach, and Penalty Clauses”. I understand what you have said to my colleague Jeremy Balfour about not being able to look too far into the future, but I would be interested to hear your view on whether those bills might come to the committee through the rest of the parliamentary session.

That is helpful. I will push back and say that you might have anticipated that the committee might ask about the proposed bill today. The SLC bills are not particularly controversial when you look at the headline subject but, although they are not politically controversial, there are a lot of considerations in them, as there are with any legislation. We want to be satisfied that the Government has done the work behind the scenes to ensure that the consultation on the original proposal is still relevant and up to date, because that will allow us to move much more quickly once the bill arrives.

I want to ask about primary legislation. As the minister will be aware, the recent programme for government committed to introducing a bill on judicial factors, which would be based on a Scottish Law Commission report. Given that part of the committee’s remit is to look at certain bills that are based on reports from the SLC, can you give the committee an indication of current thinking on timescales for the bill and whether it meets the criteria for an SLC bill?

Do you accept that the approach means that committee members cannot amend the legislation? When the detail is held back, the scope for amending legislation is limited.

That is positive to hear because, although no one ever wants to create more work for themselves, those proposals cover important areas that are often overlooked by the Parliament.