Litigation - Scottish Construction Contracts - page 334

2. that there is a real and substantial risk that enforcement of any decree to follow
in the action would be defeated by the debtor being insolvent, on the verge of
insolvency, or likely to dispose of his assets; and
3. it is reasonable in the circumstances for diligence to be granted.
The rules do envisage an opposed motion hearing to determine the application for
diligence. However, warrant for diligence on the dependence can still be sought on
an ex parte basis (i.e. without the other party being heard). If it is granted in such
circumstances, a hearing at which both parties are invited to attend will be fixed to
take place a short period after the warrant has been granted. This is commonly called
the Section 15K hearing, which is a reference to the provision which deals with recall
of diligence on the dependence. It is expressly provided that if the statutory test is not
met, the diligence should be recalled.
Interim possession of property
Another protective measure available in certain circumstances in the Court of Session
is provided by s.47(2) of the Court of Session Act 1988. 1988.This allows the court to make
orders regarding the interim possession of property which is the subject of a court
action.Itisapowerfulremedyinthatthecourtmaybeaskedtomakeaninterim
order at a very early stage of an action, without having to wait for written pleadings
to be finalized or evidence to be heard. The decision is made on the basis only of the
written cases and legal argument. his is because the decision is only interim and it is
open to the court, at the end of the process, to reverse the interim order.
An ultimately unsuccessful attempt to use the remedy was made in Scottish Power
Generation Ltd v. British Energy Generation (UK) Ltd and Another (2002). In that case,
the pursuer sought to have sums of money, said to have been overpaid, placed by the
defenders into a designated account to be held in trust in order to protect the funds
from the claims of the first defender's creditors. The Inner House, on appeal, con-
irmedthebasisonwhichthecourtshouldexerciseitsdiscretiontograntaninterim
order. Quoting Lord President Hope (as he then was) in Mackenzie's Trustees v. High-
land Regional Council (1994), the Inner House held that the question must depend
onthebalanceofconvenience,namelythenatureanddegreeoftheharmlikelytobe
suffered on either side by the grant or refusal of the interim order. Regard should also
be had to the relative strength of the cases put forward by each party as one of the fac-
tors to be considered in determining where the balance of convenience lies. Following
Church Commissioners for England v. Abbey National plc (1994), the Inner House con-
firmed that in order to justify an interim order, the person seeking it must establish
a prima facie case that an obligation exists, that there is a continuing or threatened
breach of that obligation and that the balance of convenience favours the making of
the order sought.
The s.47(2) remedy was successfully used in VTechWabagUKLtd v. Morgan Est
(Scotland) Ltd (2002). (2002).The test applied by the court was whether a valid legal case had
been made out and consideration of the balance of convenience. In relation to balance
of convenience, the court considered the relative strengths of the parties' cases and