News archive

Inner House case concerning a rent review under a lease of premises in Helensburgh.  The landlords were the trustees of a pension fund. The tenants were Argyll and Bute Council.

On 19 July 2010 a surveyor wrote to the Council purporting to act for the landlord in relation to a rent review of the property and specifying that the revised fair market rent for the property was £58k. The letter contained several errors (including naming an entirely different company as landlord and stating an incorrect review date).  On 24 August 2010 the surveyor again wrote to the Council in relation to the rent review of the property and specifying the rent but this time correcting the errors in the previous letter. The Council did not serve a counter notice but continued to pay the rent payable prior to the review and the trustees sought declarator that the rent had been effectively reviewed.

In the Outer House Lord Menzies held that the errors contained in the letter dated 19 July were failures to comply with the fundamental requirements of the lease and the letter did not operate as an effective rent review notice.  However, the second letter did satisfy those requirements. On appeal the Council argued that the second letter had failed to address in express terms all of the errors which had been contained in the first letter and that the recipient was faced with two competing or contradictory notices and two overlapping periods for service. As a result, the Council argued, the “reasonable recipient” test had not been met.

The Inner House refused the appeal. The notices had been served under different clauses of the lease; the first under a provision dealing with a ‘timeous’ rent review at the relevant term and the second under a separate provision dealing with invoking a ‘late’ rent review. The terms of the notices were different due to the distinct purpose of the different provisions. They were not competing notices and there was no scope for confusion as a consequence of the issue of both notices, assuming that the reasonable recipient applied his common sense.

The full report is available from Scottish Courts here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

The Information Commissioner has highlighted  “serious concerns” with the City of Edinburgh Council’s handling of an information request relating to statutory repairs. The Commissioner’s decision is available here.

The debate over further fiscal powers, and in particular tax powers, for the Scottish Parliament is going to be a major issue as Scotland moves towards 18 September 2014.

Not many people know that there are over 25 taxes and duties.  The Scottish Parliament only controls two of these outright.  The other power over income tax has never been used and cannot now be used.

Even under Scotland Act 2012 the Scottish Parliament will only have control of four miscellaneous taxes and partial control of income tax.

If you would like to know more about the issues surrounding the tax powers debate and the creation of a Scottish tax system, whether under further devolution or independence, please contact James Aitken.

 james@legalknowledgescotland.com

The Tories are like a stuck record for those from a bygone era.

The press is reporting today that the Tories are again considering more tax powers for the Scottish Parliament.

Have we heard this before?  Of course we have.  Does anything ever serious come of it?  No.

Let’s put this in context.   There are approximately 25 taxes, duties and charges.  The Scottish Parliament presently only has control of two of them.  See my earlier blog on this which can be found here.  The 2012 Scotland Act does not take us much further.  The Liberal Democrat ‘Home Rule’ report goes nowhere near as far as the ‘Steel Commission’ or ‘Devo Plus’.

The Tories were against even minor tax powers being included in the original devolution settlement.  Many prominent Scottish Tories struggled to accept the Calman proposal of 4 miscellaneous taxes and partial control over income tax.  Partial control means no real control at all.

The UK coalition Government watered down the extremely timid Calman proposals in the 2012 Scotland Act.  Only two miscellaneous taxes were included and some control over income tax was removed.   I like to call this “Calman minus”.

How likely is it that the Tories will go as far as say ‘Devo Plus’ which devolves almost tax powers except for VAT and National Insurance, and devolves the majority of welfare powers?   I think that is a rhetorical question.

More on this from the BBC news website can be found here.

“Substitute Attorneys

We have now received the further, clarifying advice referred to in recent communications in regard to the position of substitute attorneys. The result of that advice is such that the Office of the Public Guardian has retracted the original policy decision which required evidence of a substitute attorney’s preparedness to act at the point of initial registration.

In summary, the status quo remains in that only principal attorneys have to confirm their preparedness to act at the point of initial registration. As is now, where there is a substitute attorney, OPG will seek such confirmation only where the principal attorney fails.

We sincerely apologise for any inconvenience that this may cause you.”

More on this can be found here.

More on this can be found here.

Sheriff Court case concerning the division and sale of a property on Shiskine Drive, Maryhill in Glasgow. Mr Collins and Ms Sweeny each had a one half pro-indiviso share in the property (which was incapable of division). Mr Collins sought a sale of the property on the open market and division of the proceeds. Ms Sweeney sought an order compelling the sale of Mr Collins share of the property to her. She argued that there were equitable considerations which justified the granting of such an order; pointing to the fact that she could afford to acquire and maintain the property whereas Mr Collins could not, referring to other litigation between the parties (including an exclusion order) and making a case for the purchase of the property by her for the sake of a child of the relationship between the parties.

The principle issue for the court was whether the court could competently grant decree for the sale to a co-proprietor, against the will of the other proprietor, rather than on the open market.

After considering the authorities, the sheriff concluded that, even if proved, the equitable considerations did not constitute a defence to Mr Collins’ absolute right to insist on a sale on the open market. Although there was authority for the court to make an order for the sale of a pro-indiviso share to a co-proprietor, this only applied where both parties consented. In the absence of consent, where the property cannot be divided, a co-proprietor has an absolute right to insist upon sale on the open market and cannot be obliged to sell to a co-proprietor against his will.

The full judgment is available from Scottish Courts here.

(See appeal to sheriff principal here.)

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

The above consultation closes on 12 April 2013.

“This is a consultation document seeking views on the structure and powers for Revenue Scotland, ensuring tax compliance, tackling tax avoidance, resolving tax disputes, treatment of taxpayer information and accelerated tax changes.

The Scottish Government has indicated that it intends to use the new competence of the Scottish Parliament to introduce taxes to replace the UK Stamp Duty Land Tax and Landfill Tax from 1 April 2015. This consultation complements the separate consultations on the Land and Buildings Transaction Tax (concluded August 2012; draft Bill introduced to the Scottish Parliament on 29 November) and a Scottish Landfill Tax (consultation closes 15 January 2013).

Inner House case of some complexity in which the Liquidator of the Letham Grange Development Company sought reduction of a security over the Letham Grange resort near Arbroath. The case involves a number of companies all controlled by a Mr Liu and his family.

The Liquidator argued that the holder of the security, Foxworth (a company controlled by Mr Liu), had not acquired the rights under the security in good faith and for value. The Liquidator had previously successfully challenged a disposition by Letham Grange in favour of Nova Scotia Limited (also a company controlled by Mr Liu) on the basis that it was a gratuitous alienation. (The property which had been purchased by Letham Grange for £2,105,000 was sold to Nova Scotia for only £248,100.)

In the Outer House Lord Glennie found that there had not been a gratuitous alienation accepting Mr Lui’s evidence that the price had been reduced as there had been loans made by Mr Liu’s family in favour of Letham to finance the original purchase and that Foxworth (having assumed liability) was obliged to repay those loans to the family.

The Inner House have allowed an appeal finding that, to avoid a gratuitous alienation, the consideration given in exchange for the granting of the disposition of the resort to Nova Scotia required to be enforceable at the time when the disposition was granted. However, at that date, there was no enforceable obligation binding Nova Scotia to repay the loans to the family. Even if that had not been the case, taking account of all of circumstances, the Inner House found that the various transactions surrounding Letham Grange had been intended to defeat the claims of lawful creditors.  For those reasons a decree granting reduction of the standard security was granted.

The full judgement is available from Scottish Courts here.

(NB: See appeal to the Supreme court here.)

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

4 March 2013

Power of Attorney (PoA) Update – Manual Submissions

There is currently a 6 week waiting period before your PoA can be processed and returned to you. This week we will be working on PoAs received on and around 23rd January 2013.

Last week we processed:

• 343 PoAs – those received between 18th December and 22nd January; and
• 147 PoAs which were required urgently. Please note that this service may be requested if there is a genuine urgency to process a PoA and the reason is provided.

More on this can be found here.