Law Society questions quango bankruptcy role
The Law Society of Scotland has today, 30 October, questioned plans to transfer a large number of functions from Scottish courts to the Accountant in Bankruptcy (AiB), stating that matters of a legal nature, involving fundamental rights, should receive judicial scrutiny.
The Society is also concerned about proposals in the Bill which would allow the AiB to review its own decisions, highlighting the serious potential for conflicts of interest.
The Bankruptcy and Debt Advice (Scotland) Bill, currently being examined by the Scottish Parliament's Economy, Energy and Tourism Committee, proposes to substantially increase the powers of the AiB. In addition, it proposes to grant the AiB the power to review its own decision at first instance, where currently a sheriff exercises this power.
After giving oral evidence on the Bankruptcy and Debt Advice (Scotland) Bill at the Scottish Parliament today, 30 October, Rachel Grant, member of the Law Society of Scotland's Insolvency Law Committee, said:
"We are concerned about proposals in the Bill to transfer a large number of functions from the courts to the Accountant in Bankruptcy.
"Giving the AiB a 'quasi-judicial' role, on top of its already significant administrative functions, could create a conflict in the AiB's responsibilities between the legal rights and interests of debtor and creditors, which must have priority, and considerations of administrative efficiency, which must be subordinate.
"We accept that the AiB could deal with routine administrative matters but we consider that the Bill's presumptions as to what are routine and administrative are not always correct.
"We are also concerned by proposals in the Bill which would allow the AiB to review its own decisions. We think this raises serious potential for conflicts of interest. A key principle of an appeal process is that an independent and impartial body carries out the review of the original decision.
"Furthermore, the proposed changes may create an unnecessarily cumbersome and lengthy appeal process as it is likely that complex legal matters that are in dispute will still end up in court.
"We believe that debtors and creditors have a right to have their civil rights and obligations determined by an independent and impartial body. Bankruptcy deals with fundamental rights; matters of such importance deserve judicial scrutiny."
ENDS 30 OCTOBER 2013
Notes to editor
Rachel Grant provided oral evidence to the Scottish Parliament's Economy, Energy and Tourism Committee on the Bankruptcy and Debt Advice (Scotland) Bill on 30 October.
The Law Society of Scotland's written evidence on the Bankruptcy and Debt Advice (Scotland) Bill can be viewed here.
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30 October 2013