Picture the scenario:
You discover that the supplier with whom your charity has been having a long-running, but relatively minor, dispute over payment has presented a winding up petition to court.
Or, a sheriff officer appears in the reception area of your charity’s offices with a court order in the form of an interdict, which stops the charity carrying out a key part of its activities.
As if the consequences of such orders are not bad enough, one of the most distressing aspects of having an order served in such a way is that it often comes as a complete surprise, and has the potential to turn a charity inside out.
We can help to protect you and your business by ensuring that we are given prior warning if any of these types of orders are sought against your charity, by lodging a form of legal early warning system known as a caveat.
Caveats are only available in Scotland. They are lodged in the Court of Session and at each sheriff court where such an order is likely to be made – usually any places of business, your registered office and locations of substantial contracts.
Caveats have a lifespan of one year and we help to ensure continuous protection for our clients by sending a renewal reminder before expiry.
Having a caveat in place as a matter of course provides peace of mind and the major benefit of having the opportunity, not otherwise available, to defend the application.
Caveats can buy you and your organisation some much needed time. For instance, if a petition to wind-up the charity is lodged, we will be notified once the caveat is triggered. Importantly, caveats will delay the advertisement of the winding-up petition in the press, meaning the application for winding-up is much less likely to become public knowledge in the event that matters are promptly resolved.
In respect of an interdict, the extra time afforded with a caveat in place often means a negotiated resolution can be reached, avoiding a court hearing.
Having caveats in place is a very simple, straightforward and inexpensive answer for a charity to avoid these situations and should form a fundamental part of every charity’s risk management strategy. We offer this service on a very competitive fixed-fee basis.
If you would like more information regarding caveats, please contact a member of our Commercial Dispute Resolution team.