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Scotland Focus: October 2020

01 October 2020
Our monthly professional indemnity round-up of developments dominating the legal landscape in Scotland.

Scottish Civil Justice Council (SCJC)
SCJC Annual Report 2019/20 and Annual Programme 2020/21 

The Scottish Civil Justice Council advises on the development of the civil justice system in Scotland, as well as preparing draft rules of procedure. The Council's programme for the coming year was published last week. The key  priorities identified for the year ahead are:

  • Implementation of the remaining elements of the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018. The implementation of one way costs shifting (or QOCS as it is widely known) was anticipated in Q3 of this year, but has been delayed by the Covid-19 pandemic.  No revised date for the introduction of QOCS has yet been announced but  we anticipate identifying a fresh date for implementation will be a priority for the Council. Importantly for our insurance clients, there is no QOCS protection available at present for claimants in Scotland, and as previously reported, we suspect where possible, claimant agents are stock-piling claims to litigate, once the change is made, in order to gain the protection of QOCS, particularly where liability is not certain to be established. 
  • Review of the judicial rate of interest, which is currently 8%.  Following the 2013 judgement in Farstad v Enviroco, the Court of Session called on the Scottish Rules Council to "urgently" address the difference between the market rate of interest prevailing post recession in 2008 and that applicable to judicial awards, the application of which dramatically over compensated the winning party in any litigation. The difference is now even more pronounced, with the current Bank of England base rate at 0.1%. From a defender insurance industry perspective, the review is long overdue, and will hopefully address the unjust award of interest at a rate far and above prevailing interest rates. 
Defendant Insurance Team

We are absolutely delighted to confirm that the Defendant Insurance team in Scotland is continuing its rapid growth and  expansion, with ten new recruits joining us over the summer, to assist with new work.  This has been a successful period for the team with a record numbers of walkaways for clients, industry award nominations and a specialist accreditation.

Counter-Fraud Scotland – A Market Leading Team
-  Jill's team has been shortlisted for the Improving Public Knowledge Award in the prestigious Insurance Post Claims and Fraud Awards 2020.   The award recognises the work the team has done and continues to do identify and disrupt fraudsters and their enablers in Scotland.  

Accreditation -The Law Society of Scotland has awarded Jill Sinclair 'Accredited Legal Technologist' status in recognition of Jill's expertise and work to drive excellence in the legal technology profession. Congratulations Jill!

This is a new accreditation for the Law Society and we are excited to confirm that Jill is one of the first members of the Law Society to receive such recognition, which is testament to DWF's technology driven approach to volume claims. Jill commented:

"I am delighted to receive the accreditation. Technology has played a huge role in my career so far, particularly since I moved to DWF because of the technology solutions that are available to offer our clients. I also think that now more than ever it is important for lawyers and firms to be agile and use technology to improve efficiency and profitability in our working practices. I look forward to working with the Law Society of Scotland to build a global community of legal technologists and further develop solutions to benefit the legal industry."  

Professional Indemnity Scotland

Client training – the team have been utilising modern technology to run bespoke virtual training sessions for clients and their teams.   This month the whole team contributed to a very successful session on Legal Professional Privilege.  Plans are afoot for further sessions so please get in touch with Alison Grant or Lindsay Ogunyemi if you have anything you wish the team to cover.

The team were also in touch with clients providing commentary on the recent case of Asset Co Plc v Grant Thornton UK LLP [2020] EWCA Civ 1151. Cases concerning auditors negligence rarely reach a full trial, so this case has provided useful commentary on causation and quantum issues in these specific claims.  While the court concluded that the SAAMCO principal applied, it was clear that it was to be used as a tool for determining whether loss fell within the scope of the auditors’ duty of care, not a rigid rule of law.

If you need any further information from us please do not hesitate to get in touch.

Government Activity

Prescription (Scotland) Act 2018 

Consultation on the Prescription (Scotland) Act 2018 commencement regulations
On 13 July, the Scottish Government commenced a consultation on commencement regulations for the Prescription (Scotland) Act 2018.  

The changes made by the 2018 Act are designed to increase clarity, legal certainty and fairness as well as promote a more efficient use of resources, such as pursuers being less likely to have to raise court proceedings to preserve a right, and reduce costs for those involved in litigation and insurance. The Act makes these changes by amending the 1973 Act. Most notably, the 2018 Act makes changes in the following areas:
  • the scope of the 5-year negative prescription;
  • section 11(3) of the 1973 Act and the discoverability test;
  • the long-stop prescriptive periods under sections 7 and 8 of the 1973 Act; and,
  • contracting out and standstill agreements. 
DWF will be participating in the response to be submitted by the FOIL Professional Indemnity Sector Focus Team.     The full consultation paper can be found here >


Redress for Survivors (Historical Child Abuse in Care) (Scotland) Bill

What does this mean for insurers?
The Bill as introduced sets up a scheme to make financial payments (‘redress payments’) to survivors of historical child abuse in care in Scotland. In circumstances where the survivor has died, these can be paid to the deceased's  partner or children. The Bill sets up a new independent public body, Redress Scotland, to make decisions about payments. The scheme replaces an interim scheme called the advance payment scheme.

The Bill allows organisations involved with residential care of children in the past to pay financial contributions to the scheme. In return, survivors who accept a redress payment will have to agree not to take legal action against these organisations or the Scottish Government.

The Bill is currently at Stage 1, which is due to be completed by 23 December 2020.

Full details of the Bill can be found here >

Liability for NHS Charges (Treatment of Industrial Disease) (Scotland) Bill 2020

This Member's Bill is intended to allow the Scottish Government to recover the cost of treating industrial diseases in NHS hospitals in cases where a payment of compensation has been made to the injured person in respect of the disease. There is an existing legislative framework which allows the Scottish Government to recover the costs of treating any injury, whether physical or psychological in NHS hospitals in cases where another person is responsible for the injury. Currently, injury is defined in Part 3 of the Health and Social Care (Community Health and Standards) Act 2003 (the “2003 Act”) to exclude any disease.  The Bill amends Part 3 of the 2003 Act so that in Scotland the existing system of NHS cost-recovery is extended to cover cases of industrial disease in addition to injury cases. Further detail of the Bill is available here >

Scottish Child Abuse Inquiry

In November 2020 the Scottish Child Abuse Inquiry (SCAI) will begin hearings which will examine the actions of central government in relation to issues arising out of non-recent abuse of children in institutional care.  While public hearings were paused as a result of the pandemic, Lady Smith was keen to emphasise investigative work continued in the background.

Further updates can be read in the most recent Newsletter 2020 here > 

If you wish to discuss training for your teams please contact Andrew Lothian or Julia McDonald who lead our Scottish abuse team.  

What are we doing?
  • 6 October - Disrupt to Progress
  • Virtual Client Training Sessions – dates being organised directly

Further Reading