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Consultation on Expenses and Funding of Civil Litigation Bill

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Chapter 3: Legal Aid Provisions

A. LEGAL AID FOR LEGAL PERSONS

Current Arrangements

188. The Legal Aid (Scotland) Act 1986 ("the 1986 Act") does not presently provide for legal aid and assistance by way of representation ("ABWOR") to be available to legal persons (companies, partnerships etc). There may nevertheless be cases in which public funding is appropriate in order to ensure that a legal person has access to justice.[24]

What are we proposing?

189. The Scottish Government intends to put forward provisions that would make legal aid and ABWOR available, in certain circumstances, to legal persons.

Assistance by way of representation (ABWOR)

190. Provisions would make publicly-funded legal representation available, subject to prior approval by the Scottish Legal Aid Board (SLAB), to legal persons in the form of ABWOR for civil and criminal matters. We consider that the prior approval of SLAB is necessary due to the likely complex and unusual nature of the cases and assessments involved.

191. The financial eligibility thresholds and the calculation of contributions for legal persons in respect of ABWOR would be the same as for natural persons in the first instance. This is based on an assumption that the resources of the legal person applicant from which it is reasonable to pay toward the cost of legal representation could be expected to be broadly the same as those of the natural person applicant - though what are the "resources" (i.e. capital and income) and what is determined to be "disposable" may well be different. In recognition that this is an assumption and that operation of the system could provide evidence to the contrary, we intend to vary by regulations the financial eligibility thresholds and calculation of contributions for ABWOR (civil and criminal) for legal persons separately from the thresholds and contributions for natural persons.

Civil Legal Aid

192. We intend to bring forward provisions to make civil legal aid available for legal persons. The overall eligibility test in section 14 of the 1986 Act would still apply to applications by legal persons. However, when assessing whether it is reasonable for a legal person to receive civil legal aid, we would expect the Scottish Legal Aid Board to satisfy itself of the following:

  • the legal person does not have access to other potential sources of funding from which it would be reasonable to fund the proceedings to which the legal aid relates (including, but not limited to, the financial capacity of the legal person's shareholders, partners or members)
  • there are no other persons, including those who might benefit from the provision of legal aid or the proceedings, who can reasonably be expected to be provided with legal aid or to bring the case/raise the proceedings
  • there is a need for legal aid in all the circumstances of the case
  • there is sufficient benefit to the legal person, having regard to all the circumstances of the case, to justify the provision of legal aid

193. As with ABWOR, it is our intention that the disposable income and disposable capital thresholds, and the calculation of contributions, for legal persons for civil legal aid be set at the same level as those for natural persons, and we intend to put forward a power to vary by regulations the financial eligibility thresholds and calculation of contributions for legal persons separately from natural persons.

Criminal legal aid and contempt of court legal aid

194. We intend to make legal aid available to legal persons for all criminal proceedings (solemn and summary proceedings, appeals, including to the Supreme Court) and for contempt of court proceedings. The undue hardship test would not apply to legal persons. Instead, the Scottish Legal Aid Board would be expected to satisfy itself that the legal person was not reasonably able to obtain from any source sufficient resources to fund the case.

195. It is our intention that, for summary criminal proceedings, appeals (including to the Supreme Court) and contempt of court proceedings, the interests of justice test would apply to both natural and legal persons.

196. As with ABWOR and civil legal aid, it is our intention that the disposable income and disposable capital thresholds and the calculation of contributions for legal persons should be set at the same level as those for natural persons, for both aid types. Again, we intend to seek the power to vary by regulations the financial eligibility thresholds and calculation of contributions for legal persons separately from natural persons for contempt of court. The ability to make different provision already exists for criminal legal aid.

Providing false information

197. We intend that the offence in section 35 of the 1986 Act of wilfully failing to comply with any regulations as to the information that a person needs to provide, or knowingly making any false statement or representation for the purpose of obtaining legal assistance should apply to legal persons.

Disposable income and disposable capital for legal persons

198. Section 42 of the 1986 Act and the regulations under it establish some of the parameters for what constitutes "disposable income" and "disposable capital." It is our intention to extend the regulations to take account of the nature of the resources of the legal person, any resources of any other person which may be treated as all or part of the resources of the legal person, and any attempt by the legal person to deliberately reduce the amount of its financial resources.

Conclusion

199. These proposals are technical in nature, but would make more visible, the availability of legal aid, in certain circumstances, to legal persons.

Questions

51. Do you agree that these legal aid for legal persons provisions should be taken forward? Yes or no

Please give reasons for your answer.

52. Do you agree that the Scottish Legal Aid Board should be required to apply the financial eligibility tests set out in paragraph 187 above? Yes or no

Please give reasons for your answer.

B. FUNDER OF LAST RESORT

We will want to ensure that the Scottish Legal Aid Board has the power to ensure that it can assess the availability of other funding mechanisms for civil litigation when considering an application for civil legal aid.

Question

53. Do you agree that the Legal Aid Fund should only be used as a funder of last resort in respect of civil litigation? Yes or no

Please give reasons for your answer