29th September 2010

Property Factors (Scotland) Bill to ensure standards of practice

The Office of Fair Trading declared in 2009 that the level of customer dissatisfaction in the property factor industry is far higher than any other industry or sector providing services to the public in Scotland.

The Property Factors (Scotland) Bill was drafted by Govan Law Centre and was introduced to the Scottish Parliament on 1 June 2010 with the specific aim of addressing the failings of the property factor industry in Scotland.

The Bill introduces:

  • A mandatory registration scheme
    This will require every person appointed as a property factor to pass a ‘fit and proper person’ test. The register would be funded by an annual registration fee paid by property factors.
  • A statutory code of conduct
    This will set out basic minimum standards of practice for all registered property factors. Homeowners would rely on these in their day-to-day dealings with their property factor. In extreme cases any factor falling below the minimum standards could be de-registered, preventing them from causing ongoing detriment to homeowners.
  • An accessible dispute resolution procedure
    It is expected that a Property Management Committee will be set up to hear disputes between homeowners and factors. This Committee would have the power to ensure compliance with any contracts and minimum standards of practice, and where appropriate, require the factor to make a compensatory award or refund to the homeowner.

Mike Dailly, Principal Solicitor of the Govan Law Centre, said: “Property factors must be the only industry in Scotland who are virtually unlicensed and unregulated. When one-third of your customers are unhappy with the service you provide it’s time for a statutory solution. The Scottish Government are consulting on a voluntary accreditation scheme, but we’ve had self-regulation for centuries and it hasn’t worked. The people of Scotland need a solution with legal teeth, and the bill provides that solution in a fair and measured way.”

It is anticipated that the provisions of the Bill will come into force on 29 September 2011.

Nicola McCafferty
Solicitor

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