Formal Validity (L8) Flashcards
Which statute governs formal validity?
The Requirements of Writing (Scotland) Act 1995
What was obligationes literis in historical Scots law?
A category of obligations which required to be written.
Writing required to create the obligation.
Writing required to prove its existence (proof by writ or oath).
What does s1(1) of the 1995 Act state (the general rule)?
“Subject to ss(2) below and any other enactment, writing shall not be required for the constitution of a contract, unilateral obligation or trust.”
What does s1(2) of the 1995 Act state (the exception)?
“Subject to ss(3) below, a written document complying with s2 of this Act shall be required for
(a) the constitution of -
(i) a contract or unilateral obligation for the creation, transfer, variation or extinction of a real right in land;
(i) a gratuitous unilateral obligation except an obligation undertaken in the course of business”
What is a ‘real right in land’?
s1(7): “any real right in or over land, including any right to occupy or to use land or to restrict the occupation or use of land…”
What is a real right?
Ownership.
Lease (of more than one year).
Standard security.
Servitude.
Liferent.
What does s2(1) of the 1995 Act say?
“… no document required by s1(2) of this Act shall be valid … unless it is subscribed by the granter”.
What is subscription?
s7(1): “a document is subscribed by a granter of it if it is signed by him at the end of the last page (excluding any annexations …).
What is the law regarding self-proving documents?
s2 - formally valid.
s3 - self-proving status by signature of witness.
s9 - provisions for blind people and those unable to write.
s1(a)(ii): “A gratuitous unilateral obligation… except an obligation undertaken in the course of business”. This is the exception to the exception.
Gratuitous contracts?
- Morton’s Trs v Aged Christian Friends Society of Scotland (1899).
- Court found that it was a contract, not a promise. Gratuitous contract.
Onerous promises?
- Regus (Maxim) Ltd v Bank of Scotland plc [2013].
- Overtakes the Thomson/Hogg debate.
- At the point of formation, all promises are gratuitous as only the promiser can be obliged to act. If seen from the point of formation, all promises are gratuitous.
- If viewed at the point of performance, can be seen as onerous because both parties receive a benefit.
What does s1(3) of the 1995 Act say?
“Where a contract, [or] obligation mentioned in ss2(a) above is not constituted in a written document complying with s2 of this Act, but one of the parties to the contract… (“the first person”) has acted or refrained from acting in reliance on the contract [or] obligation with the knowledge and acquiescence of the other party to the contract [or] obligation … (“the second person”)
the second person shall not be entitled to withdraw from the contract, [or] obligation;
and
the contract, obligation or trust shall not be regarded as invalid, on the ground that it is not so constituted, if the condition set out in ss(4) below is satisfied.”
What are the criteria for a personal bar?
- Prima facie valid obligation
- One party (the first person) has acted in reliance on that obligation.
- The act has taken place with the knowledge and acquiescence of the other party (the second person).
- The first person has been materially affected as a result and would be “adversely affected to a material extent” if the obligation was invalid.
