Diligence on the Dependence

Diligence on the dependence is a provisional or protective measure which is used whilst a court action is ongoing, or just before an action is raised, but has not been finally disposed of. It allows the creditor (pursuer) in the action to take steps to preserve the debtor's (defender's) property so that it will be available to satisfy any claim eventually upheld by the court. An application is made to the court but grounds have to be established as to why the application is being made (ie: risk of flight, disposal of assets). In most cases this will require an additional hearing, the costs of which are usually met by the creditor.

Types of Diligence on the Dependence

A warrant to do diligence on the dependence of an action is sought by the pursuer in his summons or writ presented to the court. The court grants a warrant for diligence on the dependence upon commencement of the action. The warrant permits, but does not require, the pursuer to serve diligence on the dependence of the action.

There are two types of diligence on the dependence, arrestment on the dependence and inhibition on the dependence.

Arrestment on the Dependence is available to pursuers in actions for the payment of money. The effect of an arrestment on the dependence is to 'freeze' either money or goods which are owed to the defender and are held by a third party. The arrestment is served on that third party, who must not make the payment or transfer the goods to the defender. Although the amount of money claimed by the pursuer is stated in the arrestment, the amount of money or the value of the goods frozen is not linked to that amount. The arrestment, therefore, 'freezes' all money or goods due to the defender which are held by the third party, the arrestee.

NOTE: It was held in the sheriff court case of Stewart v The Royal Bank of Scotland plc, that where a defender's account is held at an English branch of a bank, but the pursuer serves an arrestment on a Scottish branch of that bank, the arrestment will not 'catch' the defender's account.

Inhibition on the Dependence By contrast, inhibition on the dependence is used in relation to heritable property, usually land or buildings, rather than money or moveable property. Inhibitions are used against heritable property in the ownership of the defender himself rather than property which is owed to him by a third party. An inhibition on the dependence affects all of the defender's heritable property regardless of the amount of the claim by the pursuer. It prevents the defender from dealing with his property in a way which might prejudice the claim of the pursuer, for example by selling the property and disposing of the proceeds.

Admirality Arrestment

Admiralty arrestment is a significant type of diligence permitted on the dependence of an action.

Admiralty arrestment concerns the arrestment of ships and cargo on board ships. The arrestment of ships and cargo on board ships differs from arrestment on the dependence generally in that the ship does not require to be in the hands of a third party in order to be arrested. It can be arrested in the hands of the owner, for a debt due by the owner. Arrestment of a ship prevents it sailing to its next destination until either the arrestment is recalled, or adequate alternative security is provided. The physical act of carrying out the arrestment is performed by officers of court. The court has power, if specific averments are made in the summons seeking warrant to do diligence on the dependence, to grant warrant to dismantle any part of a ship to prevent her sailing, but in modern Court of Session practice this is a remedy that is rarely exercised.

Ships trade world-wide and are often now owned by ship companies registered offshore. Unlike other assets, they are unlikely to be static in one place, or even one country or continent, for much longer than it takes them to load and discharge their cargo. Accordingly, the ability to arrest a ship in an appropriate jurisdiction, in order to secure a legitimate claim, is an important consideration.

There are three types of Admiralty arrestment. An arrestment on the dependence may be used to secure a claim directed against the owner of the ship, or shares in the ship, with the speciality that the arrestment does not require to be in the hands of a third party. An arrestment in rem is an arrestment carried out to enforce a claim against the ship itself or against some other piece of maritime property. It is enforceable against the ship, irrespective of ownership. Three common examples are claims in respect of salvage of a ship, claims arising out of a collision, and claims which a crew member has for his wages arising out of service on a particular ship. Arrestment in rem also founds jurisdiction against the vessel. An arrestment to found jurisdiction may be used to establish jurisdiction in Scotland, but it does not have the effect of detaining the vessel. Its sole effect is to establish jurisdiction, and if it is not followed by an arrestment on the dependence, then the vessel will be free to sail.

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