The following Property guidance note Produced in partnership with Alistair Drummond and Joanna Clark of DLA Piper Scotland LLP provides comprehensive and up to date legal information covering:
This Practice Note considers the first stage of enforcement of standard security over heritable property in Scotland up to and including service of notices under Part II of the Conveyancing and Feudal Reform (Scotland) Act 1970 (CFR(S)A 1970). It deals with the legal framework applicable, what amounts to debtor default, what creditors' rights on default are, and service of enforcement notices by creditors. The second stage of enforcement following expiry of such notices is considered in Practice Note: Enforcing standard security Scotland—voluntary surrender, court proceedings and insolvency processes.
The law on enforcement of standard securities is contained in CFR(S)A 1970, Pt II. The statutory scheme originally set out in the CFR(S)A 1970 has been significantly amended in relation to securities over properties used for residential purposes, principally by:
Mortgage Rights (Scotland) Act 2001, and
Home Owner and Debtor Protection (Scotland) Act 2010
The starting point for considering the enforcement of any standard security will be the security itself and in particular, the application of certain ‘Standard Conditions’ which are set out in CFR(S)A 1970, Sch 3.
From an enforcement perspective, the key Standard Conditions are:
Standard Condition 9—which sets out the circumstances in which a debtor shall be held to be in default, and
Standard Condition 10—which sets out the rights of a creditor once a debtor is in default,
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