Banking & Finance

The Legal Writings (Counterparts and Delivery) (Scotland) Bill (the Bill) is set to finally bring Scots law into the 21st century by allowing documents to be executed in counterpart and permitting the delivery of legal documents by electronic means.

Currently the law in Scotland on execution and delivery of documents is governed by the Requirements of Writing (Scotland) Act 1995 (the Act) and is ambiguous as to whether a document executed in counterpart would be considered valid and enforceable. There are obvious disadvantages to the current system, whereby all parties must sign the same document, not least the inconvenience caused to the parties and the potential cost of travel to attend a signing meeting. The Bill seeks to remedy these issues and modernise the process.

Key points to note about the new Bill:

  1. The Bill clarifies that a document may be executed in counterpart but it does not have to be. Execution in counterpart is an entirely optional process.
  2. All counterparts are to be treated as a single document, either comprised of each counterpart in its entirety or one counterpart in its entirety to which a signature page for each party has been attached.
  3. A document which is executed in counterpart becomes effective when both or all of the counterparts have been delivered. Delivery is only complete when each counterpart has been delivered to every party whose signature is not on the counterpart, or to a person nominated by the parties to take delivery of the counterparts (most likely a solicitor).
  4. The parties may set a time at which counterparts will be deemed to be delivered, thus allowing them to control when the legal document comes into effect.
  5. No clause specifically permitting counterparts is required in the document.
  6. Traditional documents as defined in the Act can be delivered by electronic means. The methods of delivery include e-mail, e-mail attachment, fax, disc and memory stick. This applies whether or not a document is executed in counterpart meaning this change in the law will affect all legal documents where delivery is required.

Once the Bill becomes law, the execution of documents in Scotland should become less time consuming, cumbersome, and costly, and provide greater flexibility and certainty to those involved. All in all, a welcome and long-awaited change.

Kerrie McQueen

Solicitor at Brodies LLP
Kerrie is a solicitor in our Dispute Resolution and Litigation team in Aberdeen. Kerrie has experience of a variety of types of commercial litigation including contractual disputes, personal injury actions and debt recovery.
Kerrie McQueen