References in this section to the “2023 Act” refer to the Moveable Transactions (Scotland) Act 2023.
If you suffer loss as a result of inaccuracies in the RoA and RSP then in certain circumstances you may be entitled to compensation from the Keeper of the Registers of Scotland.
In summary, the Keeper is liable to pay compensation only where the Keeper has made the error.
The Keeper is not liable to pay compensation where the error arises because someone has supplied the wrong information to the Keeper which the Keeper has then reflected on the register.
This guidance will explain the circumstances in which compensation may or may not be payable by the Keeper in accordance with the 2023 Act.
This guidance looks at situations in which parties may be entitled to claim compensation in respect of the RoA and RSP.
Background
Sections 37(1) and 109(1) of the 2023 Act, for the RoA and RSP respectively, place a statutory duty on the Keeper to compensate anyone who has suffered a loss in certain circumstances.
Someone who has suffered such a loss does not need to show that the Keeper is at fault (as opposed to, for instance, arising from an unavoidable malfunction of the Keeper’s automated systems).
A person who suffers loss as a result of certain events is therefore entitled to make a claim for compensation against the Keeper in respect of that loss.
Areas of potential claim
There are eight heads of claim under which a person who has suffered loss can receive compensation from the Keeper. These relate to a loss suffered as a result of:
- an inaccuracy in the Assignation Record or Statutory Pledges Record caused by the Keeper in the making up, maintenance or operation of those registers (including an attempted correction of it)
- the issue of a Verification Statement
- the issuing or service of a Correction Notification
- a search result that should (as a result of the search terms used) accurately reflect the contents of either the Assignations Record or Statutory Pledges Record as at the date of search but which does not
- the issue of an extract that is not a true extract
- an application being accepted or rejected in error
- an attempt to make an application, which the Keeper would otherwise have accepted, failing as a result of an error in the Keeper’s online registration system
- applications being dealt with in a different order from receipt.
Limitations on Keeper liability
There are several limitations to the Keeper's liability to pay compensation for loss in the above circumstances.
The effect of sections 37(3) and 109(3) of the 2023 Act, for the RoA and RSP, respectively, is that the Keeper is entitled to reasonably believe all information, including all documentation, submitted in connection with an RoA or RSP registration application or in connection with an RoA or RSP correction.
As such, if the Keeper introduces inaccuracy into the RoA or RSP as a result of reflecting on the register wrong information supplied to her by someone making a registration or correction application or otherwise bringing a perceived manifest inaccuracy to her attention, then this will not be an inaccuracy for which she is liable.
Rather, the person who makes the registration or correction application or otherwise brings the perceived inaccuracy to the Keeper’s attention may be liable under sections 38 or 110 of the 2023 Act for any loss suffered as a result of the Statutory Pledges Record becoming inaccurate as a consequence.
Additionally, the Keeper has no liability to pay compensation for non-patrimonial losses, such as emotional suffering. Likewise, no compensation is payable if the claimant's loss could have been avoided by the claimant taking certain measures it would have been reasonable to have taken or if the connection between the loss and the inaccuracy is too remote.
Compensation - further provisions
The compensation payable for losses due as result Keeper-error in relation to the running of the RoA and the RSP includes reimbursement of reasonable legal expenses incurred by a person (other than litigation expenses which would be dealt with by the court) and compensation for other consequential loss.
Proof that a claimant has paid for extra-judicial legal expenses and the date of that payment, as well as evidence of the date that any consequential loss was actually sustained will be required in order to calculate any payments.
Payment of compensation by the Keeper under any of the above provisions does not extinguish any rights which the claimant may have against another person in respect of the loss compensated. However, a condition of the payment is that the claimant assigns these rights to the Keeper. The claimant must therefore sign the Keeper's pro forma assignation before receiving a payment of compensation.
Unsuccessful claims
There is no provision in the 2023 Act which allows a person to seek reimbursement from the Keeper of any expenditure reasonably and properly incurred in pursuing a claim whether successful or not.
Making a claim
Claims for compensation should be directed to:
The Compensation Manager
Legal Services
Meadowbank House
153 London Road
Edinburgh
EH7 8AU
Further contact information can be found on our website.