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Bankruptcy and Diligence etc. (Scotland) Act 2007

Section 160 – Breach of inhibition

438.This section provides that an inhibited debtor breaches an inhibition when the debtor delivers a deed to a third party transferring or granting a right in any property which is affected by the inhibition. As with sections 150(3) and 159(2) it is the date of delivery of the deed which is relevant. That is the date on which the breach occurs, rather than the date of conclusion of the missives for the transfer or the dates of grant or registration of the deed.

Section 161 – Prescription of right to reduce transactions in breach of inhibition

439.This section removes any doubt that the 20 year period of long negative prescription (set out in section 8(1) of the Prescription and Limitation (Scotland) Act 1973) applies to the right of an inhibitor to have a deed, granted in breach of an inhibition, reduced.

Section 162 – Registration of notice of litigiosity and discharge of notice

440.This section inserts new section 159A into the Titles to Land Consolidation (Scotland) Act 1868.

New section 159A – Registration of notice of summons of action of reduction

441.This section applies where an inhibiting creditor raises an action of reduction of a deed granted in breach of an inhibition. The inhibiting creditor must register a notice of the signeted summons in the action in the Register of Inhibitions and in the Land Register of Scotland or the Register of Sasines (see subsection (2)). This provides notice in the personal and the property registers that the land in question is litigious pending the outcome of the action of reduction. An inhibiting creditor who fails to obtain a decree of reduction will discharge the notice in the form prescribed by regulations so that the land no longer appears as litigious in the property registers (see subsection (3)).

Section 163 – Reduction of lease granted in breach of inhibition

442.This section applies where an inhibited debtor grants a lease of land affected by inhibition. A lease granted in those circumstances will be reducible if it has at least 5 years left before comes to an end as at the date on which the action for reduction of the lease is raised. A lease which is not capable of lasting 5 years after that date will be reducible only if the Court of Session is satisfied that in all circumstances it would be fair and reasonable to reduce it. Subsection (4) specifies how to calculate the unexpired duration of a lease.

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