Contract (Formation and Remedies) (Scotland) Bill: business and regulatory impact assessment

Consultation

Within Government

48. The contract law project was part of the Scottish Law Commission’s Eighth, Ninth and Tenth Programmes of Law Reform which was approved by the Scottish Ministers.

49. Copies of the SLC’s Discussion Papers on Formation of Contract, Interpretation, Remedies for Breach of Contract and Penalty Clauses were sent to the then Civil Law Reform Unit of the Scottish Government Justice Directorate.

50. The SLC team met with members of the then Civil Law Reform Unit of the Scottish Government at the outset to discuss the project and the Unit and its successor was regularly kept informed about progress.

Public Consultation

51. As noted above, the Discussion Papers on Formation, Interpretation, Remedies for Breach of Contract and Penalty Clauses were published in March 2012, February 2011, July 2017 and November 2016 respectively. They were all also circulated to individuals and organisations identified by the SLC as having a potential interest in the topic and they were published on the SLC’s website. The Discussion Papers were therefore freely available to the general public online and after 2012 their publication was also announced via social media.

52. The Discussion Paper on Formation sought views of stakeholders on 51 questions. The consultation was open for 12 weeks and attracted responses from 19 consultees, including members of the public, an MBA student, academics, the Senators of the College of Justice, the Faculty of Advocates, law firms and other representatives of the legal profession.

53. A further consultation, on a working draft of what is now Part 1 (with the general provisions from Part 3) of the Bill, took place from 1 September to 3 November 2017. The draft Bill, a covering minute and draft Explanatory Notes were published on the SLC’s website (and an announcement was made about the consultation on social media). Responses were received from the Law Society of Scotland, the Faculty of Advocates, CMS Cameron McKenna Nabarro Olswang LLP and Lorna Richardson (then Commercial Law Lecturer at Edinburgh University). All responses were carefully considered in making the final policy decisions about the Bill.

54. The Discussion Paper on Interpretation sought views of stakeholders on 17 questions. The consultation was open for 12 weeks and attracted responses from 16 consultees, including the Senators of the College of Justice, the Faculty of Advocates, the Law Society, academics, solicitors, law firms, other representatives of the legal profession and the Royal Bank of Scotland.

55. The Discussion Paper on Penalty Clauses sought the views of stakeholders on 32 questions. The consultation was open for 12 weeks and attracted responses from 14 consultees, including academics, the Senators of the College of Justice, the Faculty of Advocates, solicitors, a barrister, law firms, other representatives of the legal profession, CCW Business Lawyers Ltd, the Competition and Markets Authority and the British Parking Association.

56. The Discussion Paper on Remedies for Breach sought views of stakeholders on 79 questions. The consultation was open for 12 weeks and attracted responses from 11 consultees, including the Senators of the College of Justice, the Faculty of Advocates, the Law Society, academics, law firms and other representatives of the legal profession.

57. In July 2024, the Scottish Government published a consultation seeking general views on the Report. This was in line with the process that Scottish Ministers set out to the Scottish Parliament in respect of potential Bills implementing older SLC recommendations. The consultation sought to establish:

• whether the landscape around this area of the law had changed since the Report was published and, if so, whether the changes were material to the recommendations; and,
• that the consultation views received by the SLC were still broadly held.^[19]

58. Analysis of the responses found that the majority of respondents expressed continued support for the SLC’s recommendations and were, with one exception, not aware of material developments in the law or practice that required those recommendations to be revisited. The exception was the law of retention^[20] which respondents felt was less clear now than when the SLC made its recommendations. The Scottish Government consulted on a statutory scheme for the law of retention in March 2025.^[21]

Business

59. The SLC also worked extensively at the outset of the contract project with an expert Business Advisory Group. Discussion with the Advisory Group helped define the scope of the SLC’s project, and ongoing engagement with members of the Group throughout the course of the project helped it to refine policy. The Group included individuals from the following businesses and organisations:

• Scott Wilson Construction Ltd;
• Federation of Small Businesses in Scotland;
• In-House Legal Counsel, RES Ltd;
• Wood Group Engineering (North Sea) Ltd;
• Glasgow Chamber of Commerce;
• Head of Legal and Democratic Services, Renfrewshire Council;
• Confederation of British Industry;
• Horizon Co-Invest Ltd;
• Scottish Procurement Directorate, Scottish Government;
• Head of Procurement, Scottish Borders Council;
• Edinburgh Research and Innovation Ltd; and,
• Commercial Counsel, William Grant & Sons Ltd.

60. The SLC’s project team made frequent presentations about their work in progress, particularly within “continuing professional development” programmes. While the audiences were made up mainly of practising lawyers, there were also representatives of business present at these occasions. All such presentations offered opportunities for discussion with business interests.