Thu 08 Dec 2016

Return to Marshalsea?

In the dim and distant past, debtors were frequently sent to debtor's prison for failure to pay sums owed to creditors. Whilst that may now seem like something from a Charles Dickens' novel, where characters often spent time in Marshalsea for non payment of debts, it is still legally competent in certain circumstances for a debtor to be sent to prison for failure to pay his/her debts. In October 2016, Hamilton Sheriff Court issued a decision in the case of Moneybarn No. 1 Limited v Steven Bell  in which the Court dealt with a request to have a debtor sent to prison.

The facts

On the face of it, the case is no different from many of the cases dealt with by Sheriff Courts across the country - the pursuers, Moneybarn No 1. Limited, had entered into a finance agreement with Mr Bell in terms of which they supplied a motor vehicle to him. Mr Bell defaulted on his agreement and so Moneybarn raised court action against him for recovery of their vehicle, failing which, payment of £8,200 (being the estimated value of the vehicle at the date of termination of the conditional sale agreement which had been entered into by the parties).

Mr Bell was ordered by the court to deliver the vehicle to Moneybarn but he failed to comply with this order. Sheriff Officers were granted warrant from the court to take possession of the vehicle from Mr Bell and deliver it to the pursuers. The Sheriff Officers were unable to do so. So far, so unfortunately familiar to many creditors. However, Moneybarn were not prepared to take this lying down.

As a result of Mr Bell failing to adhere to the court order, Moneybarn sought and were granted warrant from the court to compel Mr Bell to appear at court and explain his failure to deliver the vehicle to them. Mr Bell failed to appear at court, so Moneybarn then asked the court to apprehend and imprison him for a period not exceeding 6 months, or for the court to make such other order as appeared to the court to be just and equitable.

These orders were sought by Moneybarn in terms of the Law Reform (Miscellaneous Provisions) Scotland Act 1940 ("the 1940 Act"). Section 1 (1) of the 1940 Act provides that apprehension or imprisonment not exceeding 6 months may be granted by the court in respect of a person's failure to comply with a decree ad factum praestandum, (a judgment ordering the performance of an act) if the court is satisfied that the person against whom the decree was granted, is wilfully refusing to comply with the decree. The power to imprison is a discretionary one for the court.

The decision

In this case, the Sheriff refused to grant the order to imprison Mr Bell for a period not exceeding 6 months, in terms of the 1940 Act. His reasoning was based on the fact that although the pursuers, as a finance company, did have a right to seek an order from the court for delivery of the vehicle by Mr Bell (which is an order ad factum praestandum and therefore falls within the provisions of the 1940 Act), this would not generally, in his view, warrant the imprisonment of Mr Bell for failure to adhere to the order. He commented that "there may be instances where a sentence of imprisonment would be appropriate as an effective sanction in respect of certain decrees to perform acts, but nothing was advanced to justify such a step in these circumstances."


It is not clear what more the Sheriff wished Moneybarn to do to persuade him that the order for imprisonment should be granted. Whilst the request may be considered as harsh and an attempt to resurrect the punishment by imprisonment for non-payment of civil debt which was abolished in Scotland in the nineteenth century, it was made on the basis that they held a valid court order in terms of which Mr Bell was to deliver the vehicle to them, he had failed to do that and had avoided further attempts to make him comply with the order. Moneybarn were merely seeking a remedy which remains available to them in terms of the 1940 Act.

Mr Bell had been given an opportunity to attend at court and explain his failure to adhere to the court order, all before Moneybarn sought warrant by the court for his imprisonment. With Mr Bell still, as far as is known, in possession of Moneybarn's vehicle and making no attempt to communicate with them regarding delivery or indeed payment of the balance due by him in terms of the finance agreement, Moneybarn can surely be forgiven for trying to take whatever steps available to them in terms of the Law of Scotland to recover their vehicle.

The Sheriff did not, however, see it that way and commented in the judgment that "while many customers might relish the opportunity to acquire a new car, few would expect that experience to lead to their imprisonment on the application of the finance company". Whilst it's clear where the Sheriff is coming from in this regard, equally the reverse is true in that few finance companies would expect customers to take possession of a new car, breach the finance agreement by not making the agreed payments and then fail to return the vehicle back to the finance company even when ordered to do so by the court.

Whilst the order for imprisonment was not granted by the court in this case, in terms of the 1940 Act, the option for parties to seek such a remedy remains open, albeit at the discretion of the court.

Although it would clearly be an option of last resort, it is hoped that the availability of such a remedy will make individuals more aware of the implications of failing to adhere to a court order ordering performance of an act by them.

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