Court’s power to halt sequestration proceedings

When sequestration proceedings have been commenced by a Sheriff granting warrant to cite the debtor, can a debtor take action to halt them? This important question has been resolved by the Inner House with its decision in Peart v Promontoria (Henrico) Limited [2018] CSIH 35.

In Peart, the debtors had been served with a charge for payment and the days of charge had expired. Sequestration proceedings were commenced by the creditor in Edinburgh Sheriff Court and warrant to cite the debtors was granted. The debtors maintained that they did not, in fact, owe the sums demanded in the charge for payment. The debtors brought a separate action for interdict in the Court of Session, and were successful in obtaining interim interdict, preventing the creditor from proceeding with their sequestration. The creditor appealed to the Inner House.

The Inner House has confirmed that bringing such proceedings is competent. The Inner House’s opinion provides important guidance to debtors and creditors faced with a similar situation. The Inner House recognised that in certain circumstances, the Court of Session may use its equitable powers to intervene to bring bankruptcy proceedings in the Sheriff Court to a halt, for example when the debt which is the basis for the sequestration is disputed. This can be done by a debtor seeking suspension of a charge for payment or, where the days of charge have expired, reduction of the charge or interdict of the sequestration proceedings. Such a remedy will only be granted, however, where a debtor can show ‘exceptional circumstances’ and where the debtor can meet the usual test for the grant of interim orders.

Giles Reid of Ampersand was junior counsel for the debtors in the Inner House. Usman Tariq acted for the debtors in obtaining interim interdict.

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Ampersand welcomes Tim Young

Ampersand Advocates is delighted to welcome Timothy Young to the stable.

Tim is a very welcomed addition to Ampersand, enhancing our strong offering of junior counsel. Tim is ranked by Chambers and Partners as an Up and Coming Junior in Commercial Dispute Resolution.

Tim’s practice focuses on commercial and public law disputes. Since calling to the Bar in 2013, he has quickly developed a busy and wide-ranging practice in many areas of commercial law including commercial contract disputes (particularly construction and IT contracts), trusts, real estate, banking, insolvency, and intellectual property. He is regularly instructed in complex and high profile litigations in these areas, with senior counsel and alone.

He has, also, developed a broad experience of judicial review and statutory appeals in public and administrative law matters. He has particular experience of public procurement disputes and professional discipline matters. As well as appearing in Court, he has appeared in a wide variety of tribunals, committees, and disciplinary hearings.

 

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Timothy Young

Timothy is a very astute operator who commands the confidence of clients and solicitors alike.’ (Chambers (2024) – Commercial Dispute Resolution)

His intellectual prowess and ability to quickly and competently ascertain the critical considerations of a case and the best strategy moving forward is matched with a formidable style of advocacy.’ (Chambers (2024) – Construction)

Timothy understands issues and is good on his feet. He is popular with both solicitors and clients and robustly puts forward his clients’ positions.’ (Chambers (2024) – Company)
 
‘Tim’s ability to break down complex problems and legal arguments and get to the nub of the issue is second-to-none.’ (Legal 500 (2024) – Property, Planning and Construction, Band 1)

He is one of the best advocates at the Bar. He is very bright and very user-friendly’ (Chambers (2023) – Commercial Dispute Resolution)

Tim is excellent. He is regularly instructed in public law matters and his written work is exceptional.’ (Chambers (2023) – Administrative and Public Law)

Tim Young is a leading junior counsel with particular emphasis on commercial and public law disputes.

He has acted in many of the most complex and high-value commercial disputes of recent years. He has a broad expertise in commercial contract disputes (particularly construction and IT contracts), trusts, property (including agricultural and crofting matters), banking, insolvency, and shipping and maritime law. He is also a contributing editor to leading practitioner texts in these areas, the Companies Law (reissue) and Shipping and Maritime Law (reissue) volumes of The Laws of Scotland: Stair Memorial Encyclopaedia.

He also has substantial experience of judicial review and statutory appeals in the field of public and administrative law, particularly dealing with human rights challenges, malicious prosecution cases, public procurement disputes, and professional discipline matters. As well as appearing in Court, he has appeared in a wide variety of tribunals, committees, and disciplinary hearings.

Tim has also been appointed as a Standing Junior Counsel to the Scottish Government, and regularly appears in the courts for the Scottish Government.

He graduated with a first class honours from the University of Strathclyde. Throughout his career, he has maintained links with academia through tutoring Business Entities and Constitutional Law at both the University of Edinburgh and Napier University, and as an external examiner at Robert Gordon University. He is also the Deputy Editor of the official law report series in Scotland, Session Cases.

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Midlothian Council v Bracewell Stirling and others [2018] CSIH 21

Professional negligence action arising from house development which is said to be on contaminated land; proper construction of contract; whether the Council acted reasonably in mitigating its losses. Appeal upholding Lord Ordinary, discussing proper interruption of commercial contract.

Decision here.

Paul Reid for First Defenders and Respondents

Robert Howie QC for Pursuers and Reclaimers

 

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Kathryn Ferguson

Kathryn Ferguson joined Ampersand in 2018 and has completed Paralegal qualifications in both Conveyancing and Wills and Executries. Prior to joining the team Kathryn worked for a global law firm supporting the Commercial Real Estate and Litigation teams.

Kathryn brings a can-do approach and is always willing to assist in all aspects of instructing counsel.

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Fieldoak Limited (In receivership) v Citywide Glasgow Limited [2017] CSOH 138

Case concerning a dispute on waiver, assignation and novation between the pursuer, a property company now in receivership, and the defender, the letting agent (as the defender would have it) or the former letting agent (as the pursuer contends) under a management agreement. Full decision here.

David Sellar QC for successful pursuer.

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