Edinburgh 0131 200 1200
Aberdeen 01224 49 80 80

News + Events

Latest news from Balfour+Manson

Directors will soon be able to represent companies in Scottish Court proceedings

As from 28 November 2016, Scottish Court rules relating to directors representing companies in court proceedings will change. 
The present position is that companies and partnerships must be represented by either a solicitor or Counsel in Scottish Court proceedings. This will change on 28 November 2016 when Section 79 of the Courts Reform (Scotland) Act 2014 will come into force. Section 79 provides that a lay representative may, if the Court grants permission, conducts legal proceedings on behalf of a “non-natural person”. 
What will happen in practice?
The new power can be exercised by the following:-

Directors/Secretaries of companies;

Members/Partners of LLPs and Partnerships; and 

Members/Office holders of unincorporated associations.

The right can be exercised only with the permission of the Court. A Director or other lay representative must apply to the Court for permission. The permission can be restricted.  It can also be revoked. The other parties may make an application for the permission to be revoked.
On the face of it, this appears to be good news for any company director that wishes to take action without having to incur the costs of appointing legal advisers. However, directors need to be aware. If a costs award is made against the company, a director could be held personally liable for those costs. A director can also be found personally liable for costs if the Court determines that he has been acting unreasonably in the conduct of the litigation. It remains to be seen whether company directors and other lay representatives will be willing to take on this level of risk.
If you would like to discuss any matters arising from this with a member of the Balfour+Manson Commercial Litigation Team, please contact Gordon Deane on 0131 200 1485 or gordon.deane@balfour-manson.co.uk or David Flint on 0131 200 1215 david.flint@balfour-manson.co.uk