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Questions Q1 Should a Period of Positive Prescription for Corporeal Questions Q1 Should a period of positive prescription for corporeal moveables be introduced? Please give reasons. Yes X No The lack of acquisitive prescription for corporeal moveable property in Scotland is an odd lacuna in our legal system. Scotland stands out internationally in lacking acquisitive prescription. Those systems with codified systems of private law tend to have explicit rules. The review of the National Reports on the Transfer of Movable Property in Europe (edited by Faber and Lurger) is informative in this respect. While other systems having a law that Scotland does not should not of necessity mean that Scotland should legislate to fill the gap, it tends to suggest that there may be a policy objective that Scotland should fill. I think that this is the case here. In Scotland we have a strict system in relation to the transfer of ownership. There is very little ownerless moveable property (which can be acquired by taking possession, through the doctrine of occupation). And if you wish to acquire ownership of corporeal moveable property the strict application of the principle nemo dat quod non habet (you cannot give what you do not have) means that ownership of already owned property can only be acquired if the owner agrees to transfer ownership (subject to limited exceptions such as ss 24 and 26 of the Sale of Goods Act 1979, and the protections for purchasers from mercantile agents under the Factors Acts). While there is a presumption that the possessor of corporeal moveable property is the owner, if it turns out that a purchaser acquires from a non- owner then at common law and under s 21 of the Sale of Goods Act 1979 no ownership will transfer. This uncertainty of title is for me the principal reason for believing that Scotland should have a system of positive prescription. Q2 Is a 20 year period suitable for positive prescription for corporeal moveables? Please give reasons. Yes No X A number of the questions here are inter-related. The formal requirements for acquisitive prescription and the duration are closely tied together. When making an assessment of the law here various factors need to be taken into account. First, one must ask what is the real target of these provisions? If the rules are only intended to deal with high value or cultural assets which have a long useful life (paintings, sculptures &c) and consequently providing certainty primarily for that sector the approach would, I think, tend to support a rule where the prescriptive period is long. But most corporeal moveable property does not have a long life. The highest value asset most individuals will acquire is a car. Cars depreciate substantially in value relatively quickly and are replaced fairly regularly. Would a twenty year prescription be of utility to provide underlying certainty when considering transactions that may involve cars? In the home most higher value consumer goods again have working lives shorter than the twenty year period proposed. Washing machines, fridges, freezers, televisions, computers are replaced after only a few years. Would a twenty year rule be of any utility in relation to these assets? If the objective is not to provide the certainty prescription offers to these consumer goods then a longer period is justified. Otherwise, I incline to a shorter duration (echoing views put by Professor (then Dr) WM Gordon in his response to the Scottish Law Commission consultative memorandum number 9 on prescription. The second factor to consider is the general law of derivative acquisition. Scots law has a very strict nemo dat principle. The exceptions to it are limited in the context of corporeal moveables. For example, a second purchaser can acquire ownership from a seller of goods, who retained possession, provided the second purchaser does not know about the earlier sale. Or a purchaser can acquire ownership from a purchaser of goods who has possession of them provided the second purchaser does not know about the true owner. These are not general protections for good faith purchasers. The nemo dat principle and the strict application of exceptions to it (see paras 10.15 – 10.23 of Carey Miller and Irvine, Corporeal Moveables in Scots law) means that the certainty of the system is undermined. How can people spend money on assets (which may be a few hundred pounds and of high value to the purchaser) certain that they are acquiring the asset without the risk that there is a true owner in the background entitled to the property? If a central objective in deciding to legislate for acquisitive prescription of corporeal moveable property is to foster certainty, and to support the market as a result, then a shorter period seems desirable. A third factor to consider is the role of good faith. If the period is long can there be a justification for having a requirement for good faith throughout the period? Typically, good faith will involve in practice the “true owner” (who risks losing his or her right to prescription) challenging the party possessing and arguing he or she was in bad faith. Is a party who finds out there is a “true owner” in year 19 as undeserving of protection as a party who find out in year 10, or in year 5 or in year1? If someone has no exercised his or her right of ownership for 19 years why are they still deserving of protection? The law needs to strike a balance between being fair to the “true owner” (the person who has the asset) and to the acquirer. My own view is that if you have a long period (and twenty years is a long period of time – being our current duration of long negative prescription) there are not grounds for requiring a party to be in good faith throughout that period. Of course it may be that one rule to deal with the high end goods, such as cultural assets, and the normal goods dealt with in day to day life is not possible. That is my own feeling here. There seems to be a justification for different approaches. I would incline to a relatively short rule for the standard case. My preference would be for three years – although five year would be familiar from our law of prescription. For this shorter period I would support good faith being required throughout the period (the formulation recommended by the Commission is a neat way to avoid an overly subjective element). I would though have a long stop provision. Currently, a right of ownership of corporeal moveable property can be lost if not exercised for twenty years. The Commission recommends removing this rule – but that extinction does not take account of good or bad faith at the moment (subject to theft). I would maintain a twenty year period but would not require good faith throughout. If the “true owner” fails to exercise his or her right of ownership during that period I am not persuaded that he or she should keep it – and someone who possesses and can use the asset (even if in bad faith knowing there is an owner) seems more deserving of the asset. For cultural property I would incline to the longer period with good faith. I am mindful of the problems of definition but would rely on the Council Directive 93/7/EEC of 15 March 1993 on the return of cultural objects unlawfully removed from the territory of a Member State, despite the criticism in para 3.18 of the Commission report. Q3 Are any further provisions on prescription needed in this proposed Bill to reflect that objects might have been looted during the Nazi period or during other periods in history when injustice occurred as a consequence of the rule of law not being applied properly? If so what provisions are needed? Yes No I do not feel well placed to comment on this. I note though that the extent to which this is of relevance in Scotland is potentially limited. The property affected will often have been possessed or acquired after looting within other jurisdictions. The rules of international private law provide that rules of acquisition of rights in property are determined by the lex situs – the law of the place where property is situated at the time the right is acquired. If it is felt that there is a need to address this it may be that it is not the law of prescription that needs to be considered but international private law regarding property – which remains largely based in common law and which is devolved under the Scotland Act. The views of experts in this area (eg Professor Carruthers, University of Glasgow; Professor Beaumont, University of Aberdeen; Professor Rodger, University of Strathclyde; Professor Maher, University of Edinburgh) might be of value in determining whether anything could be done. Q4 Should time outwith Scotland be counted toward the total time period needed for positive prescription for corporeal moveable property? Please explain your answer. Yes No Given the approach of the Commission, I think time outside Scotland should be included. If my suggested approach in the answer to question 2 was adopted with a shorter good faith period I think the difficulties for Alison (in the example in your consultation paper) in being able to find the asset and assert her right would tend to suggest that only time in Scotland should be covered. However, the longer the time period the less justification there is for exceptions. This accords with the broad approach on negative prescription – where various factors may interrupt the shorter period, but long negative prescription tends to roll along in the background sweeping up problems with fewer nuanced exceptions.
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