The Scottish Government has introduced a bill to the Scottish Parliament to reform the law of negative prescription, by which certain legal rights disappear if not acted upon.
The Prescription (Scotland) Bill will refine the law to increase clarity, certainty and fairness for those in dispute over certain rights and obligations, such as rights and obligations under a contract, and allow for more effective use of time and resources.
The bill implements recommendations from the Scottish Law Commission which highlighted issues within the law of negative prescription that can cause difficulty in practice, leading to unnecessary inconvenience and expense.
“Negative prescription plays an important role in balancing individual interests, between creditors and debtors,” commented Legal Affairs Minister Annabelle Ewing. “It also serves the public interest in legal certainty by having claims raised promptly. Reform is necessary to remove grey areas in the existing law, such as contention regarding the date the prescription clock starts ticking.”
Looking at the bill in more it detail, it will:
- Extend the scope of the five-year prescription in a number of ways
- Reform the so-called “discoverability test” in the Prescription and Limitation (Scotland) Act 1973 relating to the state of knowledge of a creditor in cases of latent damage, such as when a defect emerges in a building long after it was built
- Set the start date of the 20-year prescriptive period in relation to claims for damages as the date of the act or omission giving rise to the claim
- Ensure that the 20-year prescriptive periods cannot be interrupted and allow parties to agree to an extension to the five and two-year prescription periods in certain circumstances
- Clarify that the burden of proof as to whether or not a right has prescribed falls on the creditor
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