Bankruptcy and Debt Advice (Scotland) Act 2014

Overview

The aforementioned act was passed by the Scottish Parliament on the 20th March 2014 and the measures within it come into effect on the 1st April 2015 as do a number of regulations and statutory instruments connected with the act.

The AiB have also indicated that the other proposed legislation that they were working on a Bankruptcy consolidation bill has been indefinitely postponed by the Scottish Government.

Diligence

CHARGE FOR PAYMENT
A Charge is a formal written demand for payment of sums owed. After it has been served on a debtor it gives him a period of time to comply (normally 14 days). Should the debtor fail to make payment then further action may take place. The Charge is an important step in the recovery process as unless it has been served you are not permitted to execute an Attachment, Earnings Arrestment or Money Attachment.

ARRESTMENT
This is a diligence which attaches (freezes) the goods of debtor in the hands of a third party. The arrestment is served in the hands of the third party and basically orders them not to pay or return to the debtor any movables which they have an obligation to account for. The most common example of an arrestment is where a creditor arrests with a debtors bank in order to attach the funds in the debtors account. Where money has been arrested the arrestee (third party) is required to pay the sums arrested to the creditor 98 days following the arrestment. The debtor can however object to the automatic release and the matter is then determined by the court.