LITIGATION: An Introduction to Scotland
A Decade of Change in Scottish Litigation
When assessing the landscape of Scottish litigation in the latter half of 2022, it would be forgivable to focus on the immediate aftermath of the COVID-19 pandemic and its effect on the practice of Scottish litigation and the civil court system.
However, in order to assess where things are in Scottish litigation, one really requires to look at what has been over a decade of fundamental change in the Scottish civil justice system. That change really kicked off with a sweeping review of the civil justice system between 2007 and 2009, culminating in the ‘Scottish Civil Courts Review 2009’ by then-Lord Justice Clerk Gill. The review ultimately led to the Court Reform (Scotland) Act 2014 which saw the most fundamental changes to the Scottish court system in a hundred years. Those changes included an increased exclusive jurisdiction for the Sheriff Court in respect of claims with a value up to £100,000; the establishment of a national Sheriff Appeal Court; a new national Personal Injury Court; the creation of a new office of Summary Sheriff; and various changes to court procedures, including the introduction of a new ‘Simple Procedure’ for ‘small claims’.
Also of significance was the ‘Review of Expenses and Funding of Civil Litigation’, culminating in the ‘Taylor Report’ of September 2013. The Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018 followed. In terms of commercial and business disputes, one implementation of note arising therefrom took effect in April 2020, bringing about a significant loosening of longstanding restrictions in Scotland relating to damages-based fee agreements i.e. an agreement between solicitor and client whereby the value of the fee is calculated by reference to the value of the damages awarded. A number of commercial law firms in Scotland have considered the prospect of taking advantage of such agreements, but the appetite among firms to approach commercial litigation with an entirely different pricing model (and risk profile) remains to be seen. It’s too soon to know whether this change will make any real impact on Scottish litigation practice, at least in respect of commercial disputes.
In 2014, the Scottish Government published its paper on ‘The Digital Strategy for Justice in Scotland’. The government’s Second Objective (of three) was to ‘fully digitise our justice systems’. The direction of travel which we now see post-pandemic was in reality laid out long before courts and practitioners alike required to grapple with the pandemic.
During the pandemic, the courts rapidly changed process and practice to bring about many of the aspirations of the Scottish Government’s strategy from 2014, albeit at a pace thought impossible only months prior. After around a four month near-complete court shutdown in 2020 and a tentative and flexible approach to court business since, many of the new practices have been extended into the post-pandemic period by way of the Coronavirus (Reform and Recovery) (Scotland) Act 2022. The 2022 Act serves to extend many of the new provisions to November 2023 with the potential for extension through to November 2025. It’s hard to imagine that many of the new features of Scottish litigation will ever be reversed, no matter the protestations from some.
As of the latter half of 2022, solicitors, counsel, judges, clerks and clients alike can expect to conduct a large majority of litigation business by a combination of written submissions lodged by email and video call hearings. The default position in both the Court of Session and the Sheriff Courts is that procedural business will continue to be conducted remotely, while evidential hearings will be in-person. But even in respect of those evidential hearings, the court will entertain parties’ motions to conduct those hearings virtually in whole or in part. Certainly the taking of evidence of certain witnesses by video call has become much more accepted practice than at any time prior.
Impact on commercial litigation
For those of us practising exclusively in relation to commercial disputes, and in particular utilising the specialist commercial court procedures at the Court of Session and Sheriff Courts, the changes are less impactful.
The commercial procedure and the judges overseeing them already anticipate the frequent use of electronic written submissions, the conduct of hearings remotely (in the past by telephone conference call), the heavy use of written witness statements in place of examination in chief and generally a more businesslike and flexible approach to court procedure. Consequently, many of the ‘new’ features of litigation practice are in reality to commercial practitioners only modest developments of reasonably longstanding practice.
Implications for legal services in commercial litigation – digitisation v consolidation
While plenty of commercial litigation is conducted before the Sheriff Courts, notably in Glasgow and Aberdeen with their long-established commercial courts, it is clear that the focal point for major Scottish commercial litigation is the Court of Session in Edinburgh, which also operates a dedicated commercial court with appointed commercial judges.
On the face of it, digital reforms should open up increased opportunities for those firms outside of Edinburgh (and the central belt more broadly), to increase their Court of Session practices. Historically it has been necessary for those firms outside of Edinburgh representing parties in the Court of Session to instruct ‘Edinburgh agents’ (i.e. Edinburgh firms) to assist in the conduct of those actions through their necessary physical presence near the court and the familiarity they consequently gain of Court of Session practice. Now with online hearings and electronic filing, the need for Edinburgh agents has greatly diminished and firms outside the central belt may now explore increasing the size of their Court of Session practices.
However, the greater tailwind is that of law firm consolidation. This is another major story of the last decade in the provision of legal services in Scotland. During this time, many Scottish firms, large and small, have merged or been taken over by larger national or international firms. The landscape of law firms in Scotland looks quite radically different to what it did 15 years ago and that has had a knock-on effect on who practises in Scottish commercial litigation. The effect is one of centralisation.
As international firms come to take over Scottish law practices; or those remaining national Scottish firms seek to consolidate their positions with strategic takeovers/mergers in key Scottish locations/markets, the litigation work appears also to have centralised. One need only look at this year’s Chambers rankings for Scottish Litigation in which only central belt firms are ranked and there is only one ranked individual based outside of the central belt (yours truly). One wonders whether the centralisation of law firms will continue to mean the centralisation of commercial litigation work to the central belt or whether the digitisation of the court system will allow for a more diverse geographical spread.
Major economic centres outside of the central belt like Aberdeen will continue to provide a rich supply of high-value, quality commercial litigation work. The question is how important geographical location remains to clients and whether markets outside of the central belt can maintain a good cohort of high quality commercial litigators.
Overall, Scotland remains blessed by a strong legal tradition and many fine litigators, among both solicitors and counsel, within the central belt and outwith. The Scottish bench also remains well endowed with experienced and high-quality commercial judges who remain committed to an efficient and productive approach to commercial disputes which it is hoped will continue to serve Scotland’s business community well. Despite the years of change, Scotland remains a jurisdiction supportive and capable of handling commercial disputes of both significant complexity and substantial value.