The Law Society of Scotland is to examine the idea of a new protection for homebuyers stranded without valid title to their home but unable to sue their solicitor.
Govan Law Centre has suggested that the society introduce an insurable scheme, separate from its current Master Policy which indemnifies solicitors against negligence, which would protect homeowners where the legal test for negligence could not be met. The society has said the idea is "very interesting".
It follows the report by former Sheriff-Principal Edward Bowen into two cases, the subject of a campaign by The Herald, where homeowners in West Lothian and Aberdeen have been without valid title to their property for 13 and up to 16 years respectively.
Mike Dailly, principal solicitor at Govan Law Centre, has written to Law Society president Alistair Morris after meeting with homeowners at Happy Valley Road in Blackburn, West Lothian, and local MSP Neil Findlay.
He says: "Their plight illustrates in very stark terms how Scotland's legal system for the sale of property is in need of urgent repair and cannot be said to be fit for purpose. They all used a Scottish solicitor to buy their homes, yet 16 years on they still do not own their homes, nor have they had any redress."
Mr Dailly says that while the sheriff's report had said defective title cases were "not a systemic problem" in Scotland, he had rightly concluded that they were "very damaging to the image of the legal profession". A new voluntary scheme might be needed very rarely, but would provide an essential safety net. "Such a risk could be made insurable as a matter of contractual agreement with an insurance company."
Meanwhile the principal insurers to the society's Master Policy have admitted for the first time that they are actively pursuing a solution to the crisis at Happy Valley Road. In a response this week to homeowner Ian Reid, RSA's head of complaints Mark Richardson has said a "strategy is being implemented, which might allow us to obtain clear title for the proprietors"
In the Aberdeen case, hopes have for some time been pinned on the Law Society's Guarantee Fund which pays out in cases of solicitor fraud. Sheriff Bowen concluded that the fund was too restrictive in being unable to pay out until all legal avenues had been exhausted. Neither homeowner Sinclair Brebner nor local MSP Jenny Marra were able to comment on current progress.
Lorna Jack, chief executive of the Law Society of Scotland, said: "Mike Dailly has written to us with what looks like a very interesting proposal and we are looking forward to discussing this with him in more detail."
She added: "The insurers who provide cover for solicitors via the society's master policy are also looking at what they can do regarding issues relating to delivery of title."
Meanwhile the Scottish Legal Complaints Commission this week published a consumer guide to family law, which accounts for one in five complaints made to the commission about solicitors. It follows the publication of its guide to buying and selling a home - the area which prompts the largest number of complaints.
The SLCC's David Buchanan-Cook commented: "As with so many other types of legal services that consumers use, family law is often a distress purchase, brought on by stressful and emotionally difficult circumstances. This guide aims to inform and empower consumers who find themselves in this situation."
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