Archive for September, 2014

Five FAQ’s about Divorce in Scotland

Friday, September 19th, 2014

divorce4601. Will I have to go to court?

Possibly, but probably not. Whilst the local sheriff court ultimately grants the order of divorce, it is unusual for individuals to have to attend court in person. Normally, the parties will sign documentation with their solicitors which will provide sufficient evidence for the court to grant the divorce.

2. What are the grounds of divorce?

Divorce will be granted when the court is satisfied that the marriage has broken down irretrievably. There are four ways in which that can be established:

(i) You have been separated for a continuous period of one year and your spouse has provided consent to the divorce;
(ii) You have been separated for a continuous period of two years (no consent of your spouse being required)
(iii) Your spouse has committed adultery
(iv) Your spouse has behaved in an unreasonable way, making it impossible for you to live with him or her.

3. When can I divorce my spouse?

You can raise divorce proceedings immediately if your spouse has committed adultery or has behaved unreasonably. Alternatively, you need to wait one year from the date you separated (provided your spouse consents to divorce) or two years otherwise. It is, however, important to note that any financial matters are fully considered in advance of divorce being granted, otherwise the right to make certain financial claims on your spouse may be lost. Most divorces we deal with proceed after either a year of separation, failing which, if a spouse won’t provide consent, after two years.

4. Are children considered in the divorce process?

If there are children under the age of sixteen at the time of divorce, the court will be made aware of them. Their birth certificates will need to be lodged along with your marriage certificate at the time of the divorce application. Evidence confirming the arrangements for the upbringing of the children will be provided to the court by way of sworn statements by the applicant and usually one other person. If there is any dispute between spouses as to where the children will live or how much time they will spend with the other parent, the court can become involved and make appropriate orders, if necessary.

5. Do I need a solicitor to get a divorce?

Almost always. The amount of work you will need a solicitor to do will vary from case to case. Where you have no children under the age of sixteen and all financial matters have been agreed, there is a simplified divorce procedure available. You can apply for divorce under the simplified procedure where you have been separated for one year (if your spouse consents) or two years (where there is no consent). You will be able to complete the application yourself. You must be confident all financial matters have been dealt with as once divorce is granted, you may have lost the right to make any further claim on your spouse.

In all cases where there are children under sixteen or there are outstanding financial issues needing addressed, you will need to involve us. We will assist you resolve financial matters and in most cases, agreement with your spouse will be reached either before or during the divorce action.

For further information regarding divorce or any other family law matter, please contact Susan Waters (s.waters@jgcollie.co.uk), Duncan Love (d.love@jgcollie.co.uk) or Graham Garden (g.garden@jgcollie.co.uk), of our Family Law team.

Conclusion of Missives in Residential Property Transactions

Friday, September 19th, 2014

Sold-houseUntil the banking crisis of 2008, the Scottish system for concluding missives, ie putting in place a binding contract between a willing purchaser and a willing seller, was perceived to have one major advantage over the corresponding English system. That advantage was certainty. The certainty that within a short period of time of agreeing a price, more often than not a few days, the purchaser and seller have concluded missives and a binding contract is in place. Once missives had been concluded, neither party was at liberty to withdraw from the contract unilaterally. Concluding missives removed the risk of the purchaser having a change of mind, and of the seller accepting a higher offer from a third party. With a contract in place, both purchaser and seller could plan ahead with a degree of certainty in the knowledge that they were working towards a fixed Date of Entry.

Prior to 2008, the Date of Entry was usually 4-6 weeks after the date of the purchaser’s offer. Now, in 2014, it is rare for the Date of Entry to be any fewer than 6 weeks ahead, and 8-10 weeks, sometimes longer, has become quite common. The principal reason for the increased time frame is that that Banks and Building Societies are taking much longer to process mortgage applications. Mortgage applications are now subject to far greater scrutiny, particularly post the Mortgage Market Review (MMR) of April this year.

An Agreement in Principle from a lender is no guarantee that a mortgage in “the agreed terms”, or indeed any mortgage, will be forthcoming. The, perhaps unpalatable, reality is that until a mortgage application has successfully passed through underwriting, there is no guarantee that the required mortgage will be available. A direct consequence of this is that the purchaser’s solicitor may be reluctant, or indeed may decline, to conclude missives until such time as the purchaser’s mortgage offer has been issued by the lender in question. That approach brings uncertainty for both purchaser and seller, as until such time as missives are concluded, either party can simply walk away, and that without incurring any penalties.

The seller’s solicitor may well endeavour to pressurise the purchaser into concluding missives in advance, and perhaps significantly in advance, of the purchaser’s mortgage offer being issued. The seller’s solicitor does so by imposing a time limit within which the purchaser must conclude missives, failing which the purchaser runs the risk of the seller withdrawing and dealing with a third party. The seller’s time limit is often not enforced resulting in missives, ultimately being concluded, and the transaction completed, possibly both around the same time.

However, regard should be had to the risk and consequence for both purchaser and seller should a purchaser be of a mind, or be pressurised, to conclude missives without the certainty of having his mortgage in place. Should the anticipated mortgage offer arrive in sufficient time, prior to the Date of Entry, then the transaction should complete as was originally intended. However, if completion is delayed, the purchaser would be liable to pay penalty interest to the seller on the full purchase price. In the event of the purchaser being declined a mortgage and being unable to complete the purchase, that breach of contract could have significant, and perhaps even disastrous financial consequences for the purchaser. The purchaser would be liable for the seller’s losses as calculated by reference to the breach of contract provisions in the concluded missives.

Based on the foregoing, it is easy to understand why a purchaser may be reluctant, or may decline, to conclude missives prior to the issuing of his mortgage offer. The premature conclusion of missives may turn out to be less than ideal from a seller’s perspective. Come the Date of Entry, all that a seller is looking for is the sale price. A binding contract with a purchaser who has been unable to secure a mortgage will likely be of cold comfort to the seller who has been left high and dry and unable to complete his sale. Arguably, a seller would also prefer the certainty that his purchaser had secured the desired mortgage prior to concluding missives. The alternative is the uncertainty of concluding with a purchaser who may not be able to secure a mortgage, and the seller perhaps not discovering that fact until shortly before, or even on, the Date of Entry.

Should you have any queries in regard to the effect and importance of concluding missives, please get in touch with your usual contact at the Firm or any of our residential solicitors by calling 01224 581581 or email enquiries@jgcollie.co.uk

Is it (economically) safe to come out yet?

Friday, September 19th, 2014

Stock-market-quotes

2014 has been a difficult time to be an investor, with no clear trends emerging to help guide them. Unfortunately Quarter two of 2014 has been one of mixed messages, with similar levels of modest growth from both the equity and fixed interest markets. The positive returns from both markets have led to significant debate amongst market commentators.

Normally, a rise in equity values would signify that the global recovery was continuing and we could expect interest rate rises, which would see the popularity of fixed interest assets wane and prices to fall. However, the fixed interest markets are rising, which is an indicator that equity markets can be expected to stall. So what are we to believe?

Historically, the most accurate ‘barometer’ has usually been the fixed interest market when there are contradictory indicators. Nevertheless, we cannot necessarily place the same level of trust in this being the case here. This is due to the continuation of the Quantitative Easing (QE) being undertaken by the Federal Reserve in the US and by the central banks of other countries worldwide. This has artificially held interest rates at historic lows and benefited the fixed interest markets due to the purchasing of vast amounts of fixed interest assets by these banks.

However, the Federal Reserve has already committed to terminate their stimulus operations by October of this year, which will result in a classic good news/bad news situation for the global economy. The good news is that the ‘weaning off’ of QE will allow the normalisation of markets, to the ultimate benefit of all, however, the bad news will be that there will inevitably be a period of uncertainty and nervousness in the markets, for whom it will be akin to a drug addict undergoing a detox.

It is not expected the subsequent rises in interest rates will be anything other than gradual, with there simply being a move from the ultra-low interest rates we currently enjoy to just very low interest rates. This is not expected to be detrimental to the economic recovery in general terms and any falls in equity classes should ultimately present long term investors with buying opportunities.

That said, the fixed interest markets will be more vulnerable, with the huge purchases made through QE ceasing, the market could suffer.

In the last quarter there has been a wide disparity of returns from different underlying asset classes within the equity and fixed interest markets, with the effect of geo-political developments in Ukraine, the Middle East and Gaza is weighing especially heavily.

In conclusion, this will be a difficult period, but that the overall the situation can be seen as positive and any negative short term market movements might perhaps provide buying opportunities.

The foregoing commentary is not intended to provide investment advice on its own, and remember that the value of investments may go down as well as up. If you would like our Financial Advisers to review your investments, or discuss new opportunities, please call 01224 581581 or email info@colliefinancial.co.uk to make an appointment.

Food for thought………

Friday, September 19th, 2014

Janet-Hood

Janet Hood, Consultant and Accredited Specialist in Liquor Licensing, recently received a mention in the Scottish media.
Janet, in seeking a late opening application for a kebab shop in Dundee, stated that food with a high carbohydrate and fat content caused drunk people to fall asleep.
Janet argued that, as a result, they are less likely to then abuse their partners or inadvertently cause fires by starting to cook and falling asleep.
Janet said “Medical evidence strongly suggests that eating after drinking helps induce sleep which could help lower alcohol-related domestic violence.”
Janet’s innovative argument was successful and the takeaway’s late opening was approved.

Is this what you call thinking out of the (kebab) box!