New rules will grant companes and other business vehicles access to lay representation, writes Zibya Bashir.

On 28 November 2016, the Act of Sederunt (Lay Representation for Non-Natural Persons) 2016 will come into force in Scotland.

The new rules make provision for:-

(a) companies (whether incorporated in the United Kingdom or elsewhere),

(b) limited liability partnerships,

(c) any other partnership, and

(d) unincorporated associations of persons

to apply to the court for permission to be represented by a lay representative i.e. non-lawyers, in civil proceedings. This includes the Court of Session, the Sheriff Appeal Court and the Sheriff Court.

Presently only individuals can represent themselves in any court. In contrast, limited companies and other types of businesses must be represented by a lawyer. The new rules will be capable of exercise by directors/secretaries of companies, members/partners of LLPs and partnerships and members/office holders of unincorporated associations provided the court is satisfied that :-

(a) the business is unable to pay for the services of a legal representative to conduct the proceedings,

(b) the lay representative is a suitable person to conduct the proceedings, and

(c) it is in the interests of justice to grant permission.

As expected the rules set out the functions and duties of lay representatives, the conditions that the court may impose on lay representatives and when the court can find lay representatives and non-natural persons liable in expenses. Specifically, where a lay representative has been found to have been acting unreasonably in the conduct of the proceedings, or where the court awards expenses against the non-natural person, they can be held jointly and severally liable for the costs of the action.

Put simply, a lay representative takes on a financial risk when agreeing and applying to represent a non-natural person, as they may find themselves liable for the costs of the litigation. Whether the represented party agrees to assume that risk will undoubtedly involve a balancing of considerations in terms of the time spent and the legal and litigation costs involved.

Whilst the new rules are good news for those businesses that are unable to afford lawyers, only time will tell whether the risk of finding themselves liable for the costs of the litigation will act as a deterrent to those who may otherwise be willing and able to act as a lay representative. No doubt how the courts view and respond to such matters will be a significant factor.