Pre-Action Requirements in rent arrears cases may make it easier to evict

Govan Law Centre (GLC) is launching an advice leaflet today aimed at local tenants in Glasgow who get into financial difficulties and accrue arrears of rent. Although the Scottish Government's new 'Pre-Action Requirements' (PAR) for rent arrears came into force on 1st August 2012, the PAR only apply to eviction actions where a notice of proceedings was served on or after 1 August. 

Because of the time it takes to raise court proceedings we are still seeing cases calling in Glasgow next week with notices served before 1 August. Accordingly, GLC expects to see the PAR feature in most rent arrears eviction cases in Scotland shortly. The PAR are well intentioned and designed to prevent eviction cases being raised in the first place by requiring councils and housing associations to undertake a number of activities to attempt to avoid litigation. 

Flaw in the Pre-Action Requirements for rent arrears
However, we believe there is a major flaw and weakness in the PAR which may have the perverse effect of making it much easier for landlords to secure a decrees for eviction in those cases which come to court. All of the PAR activities must take place before a notice of proceedings is served, such as negotiating a repayment plan. Some of the duties, such as the landlord's requirement to help the tenant with a housing benefit application only engage 'if requested' by the tenant. 

Need for free independent advice 
Unless a tenant obtains independent advice at the time of the PAR there is a very real danger they will enter into an unaffordable repayment plan, fail to formally request housing benefit assistance or fail to engage. We know this from our casework experience over the last two decades; landlords invariably want arrears repaid more quickly than tenants can realistically afford. And we also know that tenants do not seek out independent advice at the early stage of the PAR - typically law centres and advice agencies are approached just before or when proceedings are raised.

What does this mean in practice? 
GLC is concerned that many tenants will fail to properly utilise the PAR without good independent advice. If this happens the perverse affect of the PAR is to give the landlord a powerful audit trail and new argument for why it is now reasonable to evict. A key flaw in the PAR is that even if a tenant approaches us before their case calls in court it is purely a matter of discretion on the part of the landlord whether to re-engage the PAR.

The 2012 PAR Order clearly states the landlord's duties are pre-notice of proceedings, yet five months may have passed after that point in time before a summons is raised, and it may be another two months before the case calls in court. Scottish Government guidance recognises this weakness, but simply states it is up to the landlord to decide whether to engage the PAR activities.

There is a very real risk the PAR could become a formal box ticking exercise which enables a landlord to demonstrate how reasonable it has been.

Solutions?
The PAR will only have any traction and policy impact if tenants obtain advice when the PAR engage. Accordingly, GLC will undertake local awareness raising through a variety of channels. We need to get the messages across that tenants need to take up their PAR rights and take independent advice. Our new leaflet attempts to sets out these messages in clear and accessible terms.

Ultimately, we believe the best solution to ensure the policy intention of the PAR is achieved would be to amend the 2003 Homelessness etc., (Scotland) Act to require housing associations to notify the council - akin to section 11 notifications - when they engage the PAR in any case. That would enable the local authority to facilitate an independent intervention. GLC intends to take this initiative up with the Scottish Government.

Pre-Action Requirements in rent arrears cases may make it easier to evict

Guilty until proven innocent through the payment of fees? - access to justice in Scotland

With the second stage of the Scottish Civil Justice Council and Criminal Legal Assistance Bill before the Scottish Parliament tomorrow (Tuesday, 13 November 2012) it is important to consider whether a fundamental principle of Scots law - 'innocent until proven guilty' - will remain intact in Scotland if this Bill is passed as currently drafted.

Govan Law Centre does not undertake criminal defence work as a community controlled charitable law centre; our focus is on initiatives to tackle social injustice, disadvantage and discrimination. Yet, injustice is injustice whether civil or criminal in our society; and people are people.

The present proposals by the Scottish Government would see anyone in Scotland accused of a crime having to pay upfront fees for their defence where their disposable income was £68 per week or more to obtain criminal legal aid.

Furthermore, such upfront contributions for criminal legal aid would have to be collected by the accused's solicitor. At present the Scottish Legal Aid Board (SLAB) are paid by the taxpayer to collect similar civil legal aid contributions. Why should criminal legal aid contributions be different?

It makes no sense for solicitors to undertake debt collection work which the taxpayer presently pays SLAB to undertake. Moreover, forcing those who are defending accused persons to collect upfront fees creates an inherent flaw, which requires defence solicitors to cease from acting where fees are not paid. Such an approach introduces a systemic blockage into Scotland's criminal defence system which cannot be compliant with Article 6 of the European Convention on Human Rights.

Ultimately, how can it be just for citizens up against the power of the State in Scotland to be denied access to justice for the inability of paying legal fees? How can it be just for people with disposable incomes as low as £68 per week to be required to pay for their defence in a criminal case? Incredibly, how can it be right that those found innocent or not proven of an alleged crime still have to pay fees?

We believe that the Scottish Government are in danger of undermining a precious tenent of Scots law - the principle of 'innocent until proven guilty' - with the risk that many Scots may be deemed guilty in the future unless able to pay a fee to be proved innocent.

Guilty until proven innocent through the payment of fees? - access to justice in Scotland

Widespread support for Scottish Government to act to protect Scots from payday loan and high interest lenders

A very wide range of organisations met yesterday in the Scottish Parliament at Kez Dugdale MSP's Debtbusters meeting to discuss how we can protect Scots from the usury practices of payday lenders and high interest credit providers. In attendance were MSPs, councillors, and representatives from the Accountant in Bankruptcy, the Scottish Trades Union Congress, credit unions, Citizens Advice, the Church of Scotland, welfare rights advisors, the Law Society of Scotland, Carrington Dean insolvency practitoners, and Money Advice Scotland.

Attendees heard an update on the campaign work of Kez Dugdale MSP and Stella Creasy MP on attempts to protect consumers from the exploitative practices of payday lenders in Scotland and the UK. The Scottish campaign was backed by the Leader of the Scottish Labour Party, Johann Lamont MSP who addressed the meeting, along with Margo MacDonald MSP, a fierce critic of usury lenders.

Govan Law Centre's Principal Solicitor, Mike Dailly, spoke to GLC's paper on Fast track Debt Arrangement Scheme to provide more flexible respite and a better escape route for Scots entrapped in toxic payday loans. A clear outcome from the meeting was the Scottish Government had to act, and we needed a multifaceted approach including:

• amending and improving the Debt Arrangement Scheme to better tackle the consumer detriment from payday loans (particularly so that interest and charges can be frozen from the very outset, whereas at present this can only happen on approval of a debt payment plan);
• a Scottish public 'wealth warning' campaign about payday loans, and much better financial education in Scotland, targeted at the payday loan demographic;
• the promotion of responsible credit union lending, with local government support through all tools available, and Scottish Government backing for a 'guaranteed loan fund' to enable credit unions to compete with payday lenders in the public interest.

GLC's Mike Dailly said: "Two and half thousands year ago the Romans capped interest rates at around 8.3%. It's hard to believe we've allowed toxic payday loans to flourish in 21st century Britain, with citizens bring charged up to 5,000% APR. Many states in America have banned these products, and in 2007 Congress introduced a law to ban payday loans for military personnel because it was seen as a national security issue.  We believe it is a national financial health issue in Scotland". 

"Often the result of such expensive indebtedness is enforced poverty, personal hardship and threatened homelessness as clients cannot pay their rent or mortgage or buy household groceries as payday lenders hoover money and charges from their bank accounts each month.  While the Scottish Parliament cannot ban payday lending we do have the devolved power to protect our citizens from exploitation by using debt laws innovatively". 

A full report report from the meeting has being prepared by Kez Dugdale's office, together with the next steps for the Scottish campaign, which Govan Law Centre fully supports.

Widespread support for Scottish Government to act to protect Scots from payday loan and high interest lenders

Scottish Parliament: consensus for change at the Fair Access to the Legal Profession event

The student-led Campaign for Fair Access to the Legal Profession's (CFALP) event in the Scottish Parliament witnessed a remarkable consensus for progressive change from SNP, Labour and Lib-Dem MSPs, members of the Scottish legal profession, university representatives, civic society groups and law students tonight (23 October 2012).

The event hosted by the SNP's Edinburgh Central MSP, Marco Biagi heard from two fourth year law students who were now faced with the harsh prospect of being priced out of the Diploma (PEAT 1) after the Cabinet Secretary for Education, Mike Russell, moved their funding goal posts and any hope of being able to afford to complete the mandatory PEAT 1.  The voice of law students shortly to be excluded from Scotland's legal profession because of an unfair change in the funding arrangements was met with overwhelming support in a packed Committee Room 6 in the Scottish Parliament.

The event also included speeches from CFALP's campaign co-ordinator, Tim Haddow, NUS Scotland President, Robin Parker, and GLC's Principal Solicitor, Mike Dailly, who said:

"Scottish law students are not asking for preferential treatment - all they want is the right to borrow the same amount of student loan support that other vocational students can borrow. Architect students can borrow additional student loans for up to six years, while medical and dental students can borrow for their fifth year of study.  Postgraduate trainee teachers also have access to student maintenance loans. Why not law students?"

"There is no logic in the current policy of the Scottish Government.  It is regressive, unfair and against the aspirations that the Scottish Government has for an inclusive and successful Scotland. I hope the Scottish Government will reconsider".

Mike's full contribution is available online here.  

The debate session also heard contributions from Scottish Labour's Sarah Boyack MSP (who advised that Mike Russell MSP had now declined an invitation to convene a summit of all affected and interested parties in Scotland), the Scottish Greens' Alison Johnstone MSP, the Lib-Dems Liam McArthur MSP, Law Society of Scotland President Austin Lafferty and Dr Nick McKerrell of Glasgow Caledonian University. 

No-one disagreed that urgent action was required to prevent law students from less well off backgrounds being excluded from PEAT 1 by reason of socio-economic circumstances. 

Scottish Parliament: consensus for change at the Fair Access to the Legal Profession event

UK 'bedroom tax': GLC calls for Scottish solutions to prevent homelessness and human misery for tens of thousands

GLC is calling on the Scottish Government to set up an additional, special fund in Scotland to mitigate the impact of next April's 'bedroom tax' where tenants of councils and housing associations will face cuts of 14 to 25% in their housing benefit where they are deemed to have an extra bedroom or more.

In an address to a public meeting of tenants in Glasgow's *Pearce Institute, GLC's Principal Solicitor Mike Dailly also called upon Scottish local authorities and the Scottish Government to set up 'Homelessness Prevention Funds' where tenants can borrow small loans interest free to stave of homelessness.  Such schemes have already been successful in some parts of England.


He also called upon the Scottish Government to support an amendment to the Housing (Scotland) Act 2001 to prevent social landlords relying upon rent arrears accrued through the bedroom tax being founded upon in court actions for eviction – such debts could be pursued through other civil debt recovery routes. Such a measure could be implemented on a transitional basis to ensure Scottish tenants had sufficient time to explore all options, given it was physically impossible for all tenants to downsize due the lack of alternative accommodation in the social rented sector.

Mike said: "Where are Scottish tenants expected to go? The private rented sector has already expanded and the Scottish Government has helped this by allowing homelessness duties to be met by them. But private landlords when interviewed about their planned responses to housing benefit cuts have not said they will increase supply by building more houses; rather they will sub-divide existing houses, often former council houses”.

“It is incredible to think that the UK Government is going back to the future – recreating the conditions for the emergence of high cost slum housing – by driving people into smaller and more cramped homes as they tax the low paid and poor. The return of the ‘single end’. Victorian values recreating Victorian housing conditions”.

The text of Mike’s talk is available online here (opens as a PDF) * on the evening of Thursday 18 October 2012.

* UPDATE - the next Glasgow meeting on housing benefit cuts will take place in the Pearce Institute, Govan Road, Glasgow at 7pm on 27 November 2012. All welcome. Confirmed speakers include Johann Lamont MSP, Leader of the Scottish Labour Party, Dave Moxham, Deputy General Secretary of the STUC, Mike Dailly, GLC, and John Flanagan, Chair of Govan Housing Association, with further MSPs and councillors tbc. Organised by tenants and residents associations in Govan and Linthouse. 

UK 'bedroom tax': GLC calls for Scottish solutions to prevent homelessness and human misery for tens of thousands