Meeting of the Parliament 09 January 2014
I am grateful for the opportunity to speak in the debate. As colleagues will know, I am not a member of the Justice Committee, but I listened to the committee’s deliberations on the Title Conditions (Scotland) Act 2003 and read with interest the papers that the committee and its witnesses produced during the inquiry.
As colleagues heard from the minister, in the previous session of Parliament I took through a member’s bill to regulate the factoring industry, and it is from that viewpoint that I offer my observations on the committee’s report, particularly as it relates to switching factors.
I must admit that I had a feeling of déjà vu when I read the report, because many issues that the committee heard about were all too familiar from my experience. How do we make it easier for owners to switch factors, when there are so many complicating factors? What changes can we make that would be fair to everyone involved?
The committee has explored the area thoroughly and identified the problems. In most situations, a two-thirds majority of owners is required before a change can take place. However, what do people do when they cannot persuade two thirds of owners to come to a meeting, or when the majority of owners rent out their properties and are not easily accessible? The obvious answer is to reduce the number of people who are required to make a change, but how low do we go without making the process inherently undemocratic or unfair? How do we prevent a small group of people from making decisions that have an effect on the majority, albeit that the majority might be silent or even apathetic?
I understand from the Scottish Government response that the Government plans to consider whether the code of conduct for property factors should be changed to allow factors to give owners the contact details for other home owners in a development or property. I can understand why the Government wants to consider the approach, which I agree would be a step forward.
However, I sound a note of caution. Owners who are resident in an estate or building can easily contact other resident owners simply by putting a mailshot through their doors. The mailshot does not have to be addressed; it can just be delivered. As members know, the problem arises when an owner is not resident in the property. In my experience, a non-resident owner who has not put in place a mechanism that makes him or her contactable is unlikely to be interested in changing the factor or in getting involved in discussions about doing so. Indeed, they might not co-operate at all if a cash outlay happens to be in the equation. By making it possible for factors to give out contact details we might enable people to fulfil a requirement to contact all owners, but that will not guarantee owners’ co-operation, which is the important aspect.
Another area that I hope the Scottish Government will consider and perhaps act on is the agreements that are put in place for new developments. As we heard, the developer often makes an agreement with a property factor before work is completed on the estate or properties. The arrangement will often specify that the deal is in place for a period of, say, two years after the project’s completion. Therefore, people who buy properties in the development should know what the agreement is. However, in many areas developers have left developments uncompleted because of the economic downturn, so that first hurdle has become almost insurmountable. That means that owners can be left in limbo, finding that they just cannot switch. I have dealt with a difficult case like that in my constituency and, thanks to the work of a determined and committed group of owners, a switch eventually took place, but I wonder whether the Scottish Government will consider how the issue might be addressed, preferably without people having to have recourse to the courts.