Section 8 – Intimation of the assignation of a claim
44.Section 3 of the Act sets out that an assigned claim may be transferred by intimation under subsection (1) of this section (where the other requirements of section 3(2) have also been met).
45.Subsection (1) sets out a new rule governing the types of intimation that must be used in order to effect the transfer of a claim which otherwise satisfies the requirements of section 3(2). It replaces the existing statutory rules on intimation in the Transmission of Moveable Property (Scotland) Act 1862, which is therefore repealed by section 40 of the Act. There are a number of different options under subsection (1), although subsection (1)(a) is likely to apply most often.
46.Subsection (1)(a) provides that either the assignee or the assignor may serve notice of the assignation on the debtor.
47.Subsection (1)(b) provides, first, for “constructive” intimation to a debtor who has knowledge of the assignation of the claim and acknowledges having such knowledge.
Example
Having become aware of the assignation other than by notice, the debtor may perform – or promise to perform – to the assignee something which the assigned claim obliges the debtor to perform to the holder of the claim. The claim is transferred by the performance or the promise without any need for written intimation to the debtor (provided that all of the other requirements as to transfer of the claim under section 3(2) have already been met).
48.Subsection (1)(b) provides, second, for intimation to be given where the debtor is a party to judicial proceedings in which the assignation is founded on.
Example
The assignee raises an action against the debtor for performance of the obligation to which the claim relates. Thus if Andrew lends £2,000 to Brenda, and then he assigns the right to repayment to Carol, intimation to Brenda would be effected by Carol raising proceedings against Brenda founding on the assignation. Provided that all of the other requirements as to transfer of the claim have already been met under section 3(2), this would therefore effect the transfer of the claim.
49.Subsection (2) provides that intimation to any one co-debtor is to be treated as intimation to all the co-debtors (as it is under the existing law).
Example
Kenneth lends £1,000 to Leslie and Max. If he assigns the right to repayment to Nicola then the claim will be transferred to her by intimation to either Leslie or Max.
50.Subsections (3) to (12) provide more detail on assignation by notice to the debtor.
51.Subsection (3) concerns the form and content of the notice. It should be read with section 15 of the Act which sets out the right of the debtor to seek information about an assignation. The notice:
must provide the name and address of both the assignor and assignee, as well as details of the claim (or part claim) being assigned,
need not be set out in a single document (“document” is defined in schedule 1 of the Interpretation and Legislative Reform (Scotland) Act 2010 and would include e-mails and attachments to e-mails),
need not be signed either in ink or electronically; the effect is to authorise the practice of some factors whereby stickers are placed on invoices instructing the debtor to pay the factor, but the stickers are not signed,
can, in the case of a monetary claim, be in a style form prescribed by the Scottish Ministers under regulations, although there would be no consequence to using or not using such a form.
52.Subsection (4) makes it clear that, in the case of an electronic intimation, the required information may be provided through a link to a website or portal.
53.Subsection (5) permits three forms of service: (a) by personal delivery; (b) by post or courier (including ordinary post, not just registered delivery); and (c) by transmission to an address provided for electronic communication. Intimation can be made either to the “proper address” of the debtor as defined in subsection (11), or an address supplied by the debtor.
54.Subsections (6), (7) and (8) allow the parties to make a determination that a notice must be served by means of a particular one of the permitted ways (e.g. by electronic means), or to a particular address. In other words, the default rules can be replaced up to a point. Intimation by oral means is not, however, permitted. A determination of this nature must be agreed in writing between both parties (the holder of the claim and the debtor) unless the claim arises from a unilateral undertaking, in which case it can be effected by that person in writing. However, once a determination of this nature has been agreed, it can be updated by the debtor unilaterally.
55.Subsection (9) provides that a notice served by post or other postal services in the UK is deemed to be received 48 hours later unless earlier receipt can be shown. Subsection (10) sets out a similar rule for electronic transmission, though in that case it is deemed to be received after 24 hours unless earlier receipt is shown. The effect is to provide, where required, certainty as to the time of intimation. This is important in a question with third parties, such as creditors carrying out diligence, as the claim will transfer on intimation (assuming the other requirements of section 3(2) are already met). If the notice has not actually reached the debtor (for example, by going missing in the post) then the good faith protection rule in section 10 may need to be relied upon by the debtor.
56.Subsection (11) makes it clear that a determination can be entered into between a debtor and the prospective holder of a claim. It also defines certain terms by reference to the Postal Services Act 2011, as well as providing for what the “proper address” of the debtor means.
57.Subsection (12) allows service to be made on a party who is authorised to act on behalf of the debtor for that purpose, such as a solicitor.
