Court hearing
All cases dealing with repossessing property must be heard in court.
1Home Owner and Debtor Protection (Scotland) Act 2010 Actions for recovery of heritable property are heard in the sheriff court using summary application at ordinary cause level. It is started by using an initial writ.
The sheriff can make any decision they see fit, but they must be sure that the lender has complied with the pre-action requirements and that it is reasonable (the ‘reasonableness test’).
2s24 (5)(b) CFR(S)A 1970The sheriff should consider:
3s24(7) CFR(S)A 1970•reasons for the default;
•the likelihood of the client fulfilling their obligations under the security within a reasonable time;
•any action taken by the lender to allow the client to fulfil those obligations;
•whether the client is taking part in the Debt Arrangement Scheme (DAS);
•whether the client and other residents can source alternative accommodation on repossession.
Advisers could argue in court that where the client enters into the DAS, repossession should not be granted while the scheme is in operation. This is at the discretion of the sheriff.
Court options
In court, the sheriff can make the following decisions.
•Dismiss the case - the sheriff throws the case out of court because the lender has not followed the correct procedure or does not have the right to repossess the client’s home.
•Continue the case – the court sets another date for the case to be reviewed. This may happen if more information is required, or the court wishes to monitor a client’s payments toward their arrears.
•Sist the case - this pauses the action without a further court date.
•Grant an order for repossession – the lender is given the right to evict the client.
At this stage, advisers could ask for the case to be continued or sisted if the client is looking at a Debt Payment Programme (DPP) under the DAS or informal payment arrangement and you need time to put an offer together. This is at the sheriff’s discretion.