A Practical Guide to Granting Corporate Security in Scotland
PUBLISHER: W GREEN
This book is a very welcome addition to Scottish legal literature. Its author, a senior associate at Dickson Minto and honorary lecturer at the University of Glasgow, has drawn on existing treatments of areas such as the law of rights in security, company law, the law of execution of documents and international private law to inform his work. But he has broken new ground in Scotland by showing how these inform the drafting of corporate security documentation. To anyone working in this area, this book should be an essential point of reference.
It is worth noting at the outset that the coverage is limited in general to security over property (otherwise known as real security or security over assets). Cautionary obligations (guarantees) are in principle beyond scope, although third-party security, where Y grants security to Z for the debts of X, is covered. The book’s title by itself reveals that security granted by non-corporates such as sole traders, and tacit securities such as lien and the landlord’s hypothec, are not discussed.
The book is divided into three parts. Part I, which has four chapters, deals with capacity and is mainly concerned with company law matters and execution of documents. Part II, which has five chapters, deals with security. Beginning with general considerations, it then considers floating charges, fixed security over moveables, fixed security over heritable property and, finally, ranking. Part III is entitled “administration”, but it is not about the corporate insolvency procedure. Rather, it considers registration and release of security rights, followed, in the final substantive chapter of the book, with an account of legal opinions. This covers the two types of opinion normally given in corporate security transactions: capacity opinions and validity opinions. I found this chapter particularly valuable as its subject matter is not covered by any other Scottish book of which I am aware.
The book is well researched. It engages effectively with both primary and secondary sources, ranging from Supreme Court decisions to an article on priority circles in the Edinburgh Student Law Review. The comparative references, naturally often to English law, but to other jurisdictions too, are helpful. On our most controversial of security rights, the author expresses himself vividly: “The floating charge under Scots law is definitely a blunt instrument, but as with all blunt instruments it can be particularly effective” (para 6-06). For the most part, the author is very mindful of the differences between Scottish and English property law. But the opening sentence of chapter 7 (“we can move to the law and practice of the fixed charge in Scotland”) is likely to have caused a Grettonian groan, despite it being qualified by an explanatory footnote.
I have three suggestions for future editions of the book. First, although the author provides a detailed and helpful narrative on the clauses typically to be found in corporate security documentation, some actual style documentation, perhaps in an appendix, could make the coverage even more accessible. Secondly, the occasional diagrams and flowcharts assist the reader. There could be more. Some (particularly the one on p 20) need to be printed more clearly. Thirdly, the glossary (chapter 12) might be longer. The entries which are simply abbreviations could be listed separately. Some suggested additions for the glossary would be “charge”, “debenture” and “mortgage”.
Finally, as the lead commissioner on the Scottish Law Commission’s recent Report on Moveable Transactions (Scot Law Com No 249, 2017), I was struck by the author’s level of engagement with this and his enthusiasm for it to be implemented (albeit with some reservations on detail). This book underlines again the dated and restrictive nature of Scottish law in this area. In writing this book, Mr Hardman has performed a great service to the legal profession. It is to be hoped that in subsequent editions he will be able to assist it again by explaining the practicalities of an area of our law that has been reformed to meet the needs of modern business.
George L Gretton and Kenneth G C Reid
PUBLISHER: W GREEN
The newest edition of Gretton and Reid’s text has been updated to include the most recent developments in the world of conveyancing, most significantly the introduction of the 2012 Act and the replacement of stamp duty land tax with its singularly Scottish successor, land and buildings transaction tax.
As all conveyancers will be aware, since the turn of the 21st century, many momentous changes have occurred in the profession, making keeping up to date with most recent legislation, case law and practice a difficult task in itself. Gretton and Reid’s Conveyancing is undoubtedly the first port of call for the majority of conveyancers seeking guidance on such issues and is certainly an important text for students of law and those entering the profession. It would also be the starting point for many practitioners to begin a more in-depth investigation of conveyancing problems, given it provides many pointers towards suitably more specific texts in most of the areas it covers.
Turning then to the changes covered in this newest edition, the authors have provided a specific discussion of the property registers as they currently stand, with much information regarding the proposed closure of the General Register of Sasines and goal to complete land registration in 2024. The authors also cover the various types of registration under the 2012 Act, the new registers introduced (for example, Register of Community Interests in Land), the proposed registers yet to be introduced (for example, Register of Persons Holding a Controlled Interest in Land) and a helpful section on inaccuracy, rectification and realignment.
A new chapter has been added to cover the types of searches now required under the 2012 Act, and the use of advance notices which have largely replaced the system of letters of obligation. The advent of electronic registration, digital discharges and e-missives are all discussed at length, as are the effects of the Legal Writings (Counterpart and Delivery) (Scotland) Act 2015. A chapter covering the advent of land and buildings transaction tax and its complex partner, additional dwelling supplement, has also been included to give a helpful overview of the new system and its vagaries, although the authors do clearly point readers in the direction of Revenue Scotland’s website for clarification in such matters. There is also brief mention of the now widespread use of Scottish Standard Clauses for residential property contracts, although the pace of change in this area of law is reflected in the authors’ references to the second edition of the clauses which has now, of course, been superseded by the third edition.
Gretton and Reid’s work will remain the backbone of most conveyancers’ reference library; however, given we have been dealing with the consequences of the 2012 Act for a little over four years now, it does feel that the majority of practitioners will be painfully familiar with the new rules and regulations governing registration. In any event, the importance of their text to all those studying, practising or involved in conveyancing in Scotland today has not diminished.
In this issue
- How will Brexit affect my mother-in-law?
- Settling the debate on sequestration
- Taking wellbeing seriously
- How will personal data continue to flow after Brexit?
- Buildmark, and a little extra help for NHBC
- Reading for pleasure
- Opinion: Laurie Anderson
- Book reviews
- Profile: Lord Mackay of Clashfern
- President's column
- People on the move
- Is your legal software ready to remain compliant in 2019?
- What's the deal?
- Ready to leave?
- A tapering opportunity
- Brexit: no dealbreaker either
- The business of divorce
- Trailblazing 12
- Cohabitants: rebalancing the law
- Litigation: an evolving scene
- Chain transactions
- When delay is not fatal
- Data protection – deal or no-deal?
- Two cases and an order
- Reshaping trade mark law
- When the wheels come off
- Parentage or privacy?
- Access right, right of access or right of way?
- Team of one
- Public policy highlights
- OPG update
- Housing specialism added to accreditation list
- At the boundary's edge
- Keep the dual role
- Executry and trust accounting: new guidance
- Moving nightmares
- Accredited paralegal update
- Sign up for conference
- Accredited Paralegal Committee profile
- Ask Ash