Registers of Scotland - Temporary Closure of the Application Record due to COVID-19

Background

On Tuesday 24 March 2020, the Registers of Scotland (RoS) took the decision to close their offices to protect the health and safety of their employees, in line with the UK Government’s advice to protect the nation against COVID-19. This means that the application record has been suspended until further notice and no paper applications will be processed. RoS have advised they are working on an effective digital solution to the receipt and processing of applications, and it is anticipated there will be an update on Friday 27 March 2020. All digital applications will continue to be processed, however, these represent a very small number of applications, and do not include, for example, the registration of a Disposition to effect a title transfer, the registration of a long lease and the registration of security documentation to deal with financing matters.

Consequence

As a result of the closure of the application record, the recommendation of the Property Law Committee, which CMS is adhering to, is that solicitors must not complete any conveyancing transactions until RoS provide a further update with a clearer picture of how we deal with settlements during this period. The inevitable consequence of this is that our clients should expect a delay in the completion of imminent transactions. CMS will continue to proceed in readiness for completions once digital registration procedures are announced, for example, by having documentation signed and in the possession of the intended recipient, albeit we cannot effect completions.

Contract Fulfilment

Our clients may be concerned that the inability to effect registration means they could find themselves in breach of concluded/exchanged contracts e.g. the inability to submit documentation for registration. It is fair to say that in these uniquely challenging circumstances, breaches such as this would unlikely be considered material (depending on the particular circumstances) and they will, of course, be capable of fulfilment at a later date. It may also be an option to vary and/or extend contracts so that completion will take place at a later date to allow the immediate registration issues to be resolved.

Use of Digital Signing

We appreciate that our clients may suggest the use of electronic signatures to combat the difficulties in having deeds signed, however, the settled position in Scotland is that any document which has to go to the Land Register, Sasine Register or Books of Council and Session must include a wet ink signature. Whilst we anticipate RoS being in a position to provide a workaround to the current unavailability of the application record by means of digital applications and registrations, it seems unlikely that the need for a wet ink signature of deeds will be dispensed with and so our clients should be live to the potential need for creative solutions when it comes to document execution.

Going Forward

Once RoS are able to update the legal community on how they intend to deal with electronic submission of applications CMS will publish a further update, and are available to discuss all transactional concerns in the meantime.