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Important decision on repossession hearings

The decision in McLeod -v- Prestige Finance Limited (20 May 2016) has some important consequences for practice in repossession cases.

The borrower applied to the Court of Session for the “reduction” of a repossession decree. He was late with the normal appeal procedure.

This has been a defended repossession action with an order for an evidential hearing (i.e a trial of the case). There was no agreement between parties on the arrears figure, service of a calling up notice or even the security documentation.

Prestige’s solicitor did not call any witnesses. Mr McLeod said he would only give evidence if Prestige did. The solicitor began to make a submission and Mr McLeod left and later decree was granted. Eventually at the Court of Session hearing the judge criticised Prestige’s failure to present the requisite quality of evidence. He said that this was an issue of substance and not simply a technicality. They were not entitled to disregard the law of evidence. It was not right that they had failed to lodge principal documents in court.

In many cases, lenders will not give evidence at these hearings nor will they produce all of the documentation. Usually the level of arrears and documentation is not in dispute. The clear import of this case, however, is that where there is a substantial dispute as to the facts and to the documentation lenders and their advisors should consider lodging all of the necessary paperwork including principals or certified copies and either producing affidavits or bringing along witnesses from their clients to speak to the facts and circumstances of the case.

For further information, please contact David Forrester.

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