Hello, everyone. Thank you very much for being here today and I Submitted to talk about CC AI and open source voice interface and Luckily the core developers of this project are also here today. We did not know that he will be able to make it so I take this opportunity to invite him here and also the Two of the founders here so that we can have a conversation together which is more interactive instead of me present the project as a community Outage we have more insight of the project. So we gonna start now And a little bit about myself. My name is a home food tank. I came from Vietnam I'm one of the contributors of Force Asia I'm currently working in Berlin, but regularly travel to the Singapore and other country in in Asia I In the Suzy AI project, I'm one of the community Irish go out to talk to tell people about how cool the project is and what we we want to do with with Suzy and Something personal I like swimming and I like to teach people how to swim and here next to me. I have Mario Belling He can introduce himself Thank you. So hi, my name is Mario. So I lived many years in Asia and Yeah, I also have to get the first Asia community started and for many years I'm sharing an interest in search engines and we'll talk a little bit more about this later And that's how I met Michael who's the founder of yassi.net and the great coder behind it So that was many years ago. When was that Michael? One of the first first Asia when when I was there Yeah, and in the zero years somewhere in the late Yeah, so yeah, I'm glad that we are invited here and great to see and many people interested so My name is Michael Michael Christen and as Mario said I created yassi peer-to-peer web search And this is a big data and distributed systems, which I did Large-scale data systems organizing data and so on so Suzy was just the next step To follow up with the idea of search engines, but we will hear here about this in detail So I'm doing the core architecture of Suzy and I'm happy to be here to help now Okay, so what exactly Suzy are in the past this is even before I was born people already imagine how they can communicate with the computer via voice and They turn their wish into Movies and series and we can see in Star Trek how they try to communicate through a mouse with the computer So what happened these days we are now be able to talk to our phone and Devices so and the thing that you can see a lot these days in the markets the very cute Speakers, but they label it smart speakers. So why it says Mars because in the past the speakers is a device that Produce audio Output so that you can listen to some music smart speakers mean that Now you not only you listen to the music, but the device They're able to listen to you and be able to perform some kind of action or it To answer your question or do some kind of task on your behalf So as we can see most of the vice out there are Dominated by major tech players Google Apple Amazon Microsoft and some big Chinese provider like sell me or Korean producer Samsung Where and we haven't find any free and open source personal assistant that being Introduced in this field up to now This is the slide that I saw in a lot of presentation about conversational web the researcher mentioned that next year 75% of the US population will own a smart speaker and This is a really big market and you can imagine that within a year from now You'll be able to speak to any devices you can speak to your phone your your laptop or you have a car You can even speak to your to your car. You can come in and tell me The system to sort on the life for you isn't it's cool No, but What is the side effect of this so where we have all the device connected?  Is it a good thing or a bad thing? It is always been a big debate in the market, right? And Some of you may have seen already this article on CNN about the Google home and The e-dropping action how the device actually listen to your conversation and Transfer it to the central system To respond to this Google said that they all did the activated function But we never know so this is only one case that being published On the new but there's also many other provider So our concern either is what gonna happen with our data in the future where everything is connected And it was also the motivation why we want to to be able to see AI we need a free and respecting privacy System to personal assistant that was The answer for the question. What is to see I? How did we start the project in the beginning so This is the team This is the team behind to see how I we already have so lucky that we have everyone here today We also have Hundreds of developers from everywhere From from India from Vietnam many different places in Asia and some coming from Europe But unfortunately we cannot bring 100 people here on stage even though we would like to thank every single one of them Just a little bit about the background of Susie so it's originally started by I The creator of Yesi.net and maybe I don't know anyone here using yesi.net One person. Wow. So good. So how about we've had the opportunity to explain to people a little bit about yesi What is the difference between yesi and Google? So this is the basic This slide points out the difference between centralized search and decentralized search. So if you have And connected with the question. What is distributed? So a search engine like every large-scale search engine Google and Bing and everything else and They they are distributed because They have a lot of servers and the task is distributed to all these servers, but they are not decentralized They are centralized so a distributed system which is centralized and what I wanted to do is to switch from Distributed not the centralized system to a distributed and diesel and centralized system So take all these computers apart and make a big network out of it and control all the all this data with a peer-to-peer network so it's like It's like file sharing, but it doesn't share files it shares indexes Another project that share Substantial amount of code together with the CCI which is another project called lock lock And in false Asia we have been working for several years on the social media data engine lock lock against this one was started by Mario and Michael in 2014 at the CCC we could not find a Okay, so at this time at the CCC 2014 we could not manage to find a big data source to play with so we start the lock lock project so the idea of lock project is to harvest Social media data to play around with and From the data so we collect all together two billion trees From from Twitter and then when we have a huge amount of time what we were thinking so what we can do with it So we start to Index the data and make sure so instead of having the normal shirts box. We also try to see if we can Create question and get A reasonable answer from from from these data and that was also the stock of Susie I project. Okay, so Another thing that we realize here so we have the Google home and Alexa echo at home Ourself so we try to to test it and see what we can do we divide because we at the moment build to see what we realized is that Whenever you have a question to add the device every few months it will give you a Different angel and you will not be able to perform sometime that you were able to perform two months ago For instance over Christmas this year. I tried to play ask you go home to play some Christmas music It was possible last year, but this year's asked me to sign up for a premium account on Positify in order to to search for my song And it's really tricky somehow if you also just open the browser on on your laptop you'll be able to display the music from from from YouTube, but it's not possible on the speaker and This is also the reason why we think that it's important to have a smart speaker that is how do you say is Provide transparency and the information that not that provide you the freedom the choice of listen to To what you want to hear instead of somebody push the information into you Based on some kind of partnership with the provider What are the what are the expectation form of smart assistant? So it's mentioned that beside playing music What else we can do what kind of business domain that we can tap in with to see I maybe you can tell A little bit so I think there are many different things that we could do with a smart speaker And we can look at like a search engines how they do this today So actually if you search engines years ago, there was always Like a list of websites with links too, but nowadays we see many answers already And you are a search engine experts Michel so maybe you could tell us a bit about your experience What what do you see how how has it changed over the years now? What what do we get us an output to questions we ask to search engines? The first step which was observable was semantic enrichment like another display of more information about a topic, but Now if you if you try to search at Google with a Complete sentence then Google gives an answer in a complete sentence or if a Complete list of what you have to like if you ask about cooking It's like you get a recipe and you don't need to click on the search result Actually get here's the example if you ask for how to cook spaghetti Then of course you get you get a search result But not that as the first hit at the in the beginning you get complete answer You don't need to go to that to the web page anymore. So Google is starting giving direct answers to direct questions so this is this is Makes it visible how the steps from the web search is going to Smart speaker you all already have this on the web page in a search result You don't actually don't need the web anymore to get answers so in the future if you if The next generation will not recognize anymore that there are search results that you can go to a web page You just get direct answers. So it's obvious this that the interface Should change and should change only to giving direct answers to your questions And yeah, not just answers also actions so for example like it's possible to and play songs directly or to Play videos directly Yeah, for example an output that we were thinking also is charts or diagrams So any kind of media could be performed by Yeah voice or by voice can also be like your TV could we have a voice interface and show Screens as well and you could also imagine that you control AR VR So it's just a normal user interface So the next slide would be a lot of people actually come to us They try out to see online and they said it. Okay. This is not working and what we Want to do people don't believe that we can't Build something that can compete with the major tech player So what are the opportunity out there? Is it something that feasible that possible to make an open source? personal assistant or it is just an idea For fun, but we do not do the for fun We really want to to make it possible and then and then we do believe that it will happen So whenever people ask you that if it for open source, it's not gonna Be successful then we would give a sample of wiki media What is the biggest the dictionary now most of people use wiki media is show this is the some of the Motivation we believe that with the old with the power of the community we can make things happen and We are here to share our idea and we hope that people would join up with us with the same vision and same believe that we can Build something that relates Alexa or Google home this is another Example of a successful open-source project WordPress, I don't think and of course Linux We don't need to to talk further. There's plenty of Successful opens up project out there and and and we believe that Susie could be one of those Again with the power of the community, I think that we definitely able have the possibility to achieve amazing amazing things and The goal of Susie each you this power to build machine that can answer all the question and The people could think of Our advantage the day is because a lot of people working on the fields There are already a lot of question available out there through the huge data set of the worldwide web and We can also use the day dynamic web content and tap into open API's or Jason web services They these all these data enable us to provide content for our system and For the answer and respond of Susie for instance You can you can call an external API on on where does it answer all the question related to Where the forecast for instance? so our approach to build the entire ecosystem that makes us engage a lot of people in the community to build different client for for Susie and they also like different component and And Trending the service in the different way, so there are a lot of challenge out there, but whatever decision we take What we want to do it to give the user a choice to limit the storage of personal data on on the cloud So what is the progress of the project? What kind of components already available? in Susie hi, so right now in front of us I have the Susie smart speaker prototype So this is a very simple to prototype you with the Raspberry Pi Microphone and the speaker head. So basically it only plays One task which is play have you to play the music and the reason why we want to do this Is we want to have a prototype to show people that it's possible to do something with with open source and Majority of the people who own the device. They only use the device to play music This is the majority interaction of the user Based on some research So what specific should I say about it? So we wanted to make it easy that everybody can rebuild this thing. So we didn't put on Special hardware of something which is difficult to get so this is just the Raspberry Pi 3 and For 10 euros microphone had we did a lot of experiments with microphones USB microphones and it didn't work very well. So 10 euros for their two microphones on it. It's called Re-seat to microphone head Re-speaker receipt seat. Oh, yeah, the company is called Reese receipt Seat studio. Oh, sorry. I messed it up But if you can ask us and there there's also it's an inner documentation what we use so All design parts are of course Available as open source and this small piece of 3d design also as well We have an respion Version we forked the respion Repository and made our own respion version with our software. It's called Zuzibion and It's built automatically and you can put it on the SD card and it runs then the device So I think a challenge here is that a lot of people in the community they have knowledge about software But our experience is also that not everything can be solved with software only for example And there's always the question of the hot words here So a hot word to activate a device and our experience is like if you have a very good microphone And then it works much better than let's say with a cheap microphone But of course the goal is to keep the price of the hardware that is needed to build an Open-source Assistant below a hundred dollars Yeah, or a hundred euros So so this is a challenge that we are facing and yeah We are continuing the conversation with hardware developers here and if anyone has Any knowledge we are happy to to learn from them how they solve these challenges watch Michelle and Mario dimension And something that another thing that we already implement. We have the Android and iOS Client for for Susie so you can actually download the app on the app store and try to to test our test the system Another thing we also have a web Client so on on a web player need to also ready is built with the react.js and It's supposed to support most of the action types Including what Mario mentioned earlier images audio video map table charts and Yeah, we also want to Encourage more user to join it and test the existing action types that are valuable out there and Another thing that we already implemented we have another desktop client using the electron framework Why do we use electron framework is allows the development of desktop Queue application using components originally developed from the web and There's something that we are really happy about and also very proud of those skills CMS so what is a skills a skill is a drawer or set a drawer that Produce in so for for question. Yeah And if you have Experienced in building skill with Alexa, you will see that our skills in F look very similar It's have a good interface and also very easy to use Why is it? easy to use In all the services in order to write a skill or to raise a drawer set up rule You need to know a specific set of program programming language But for Susie you don't have to it doesn't matter with a programming language that you use we Invented something called the language of thought With very simple and easy like the wiki style so you can create your your skill within a Few minutes instead of have to go back and learn Java or Python And We also saw the core of the Susie come from Susie AI server I think we share later on you can explain a little bit about the language of thoughts how you That is this idea in the beginning. Yeah Susie server provide output in the creation file. Yeah, is it the Yeah, so this is a complete picture of the Infrastructure of the of the project so we have Susie server in the middle and then the Console service system component and different clients that being implemented already Beside what I mentioned already the Android app iOS web app desktop application We also build many extension for the browser. So it available on the Rom Romium file folks and we also build one extension for the magic mirror project if any of you familiar with that project so the Magic mirror you say in front of the major and it will tell you Your personal profile and your interest And we also implement many multiple messenger boss for Services like Facebook like it's a vibrant slack and tell a ram and the community continue to regain more Messenger boss on this too. Yeah, what is the technology stack behind Susie? So I think Yes, so we share the Susie server. What is the technology? People understand that people interested to view the client but they always come in other question about the server How the Susie run in the back? So the Susie server is implemented in Java software. It's a server which accepts requests containing the string that the Person the user has spoken or typed in and it responds with a JSON object. So it's actually really easy The it doesn't mean that you have to program In Java if you want to make a skill as one folks said the language of thought is really easy and it's really it's Understandable. It's not programming But You don't know you don't need to know something about the server if you want to use the Skills or program skills. So this is just a typical Java stack Oh, yeah, this is like a normal full stack application so the the front end is implemented in HTML and We are using Yeah, the Java for that is No, no Java HTML front end is in the in the application front end and in the web front end So Android is native to Java or Kotlin and this is just this is just a normal technology Interestingly, we don't know so much about the background information how Other smart speakers are implemented. So There's nothing where we can copy some behavior from and This is very similar to the other search engine projects that I made before so It's a lot of things are search engine related like scraping a search result from YouTube to get a list of Possible movies that we can play as music. So Yeah, this is another component which we need in the smart speaker So we don't we always need the answer from the Susie server back end to have some intelligent Answer with some knowledge inside but to get there in a device like this We first have to do a speech detect a text and after we get an answer We must do a text-to-speech So right now we are using the best opportunities from a technology standpoint which we get which is Google speech or text and text-to-speech of course this Project is also about privacy. So actually we shouldn't do this But this is an intermediate step until we have something which can run on the device itself which We would be happy to use So there there is a software like pocket sphinx to do Speech-to-text, but it's not working so well and it's not good for demonstration It's implemented in our client, but we are not using it for demonstration. Yeah, I think this is an important point but architecture wise we discussed this point several times and So the implementation is done in a way that we can switch between different voice recognition Services or solutions. So Once we have enough data or better service, we can just switch to it immediately and it's not always about the software It's also about the data for example CM use things or other projects The question is do you have? like a good language set in this software solution and we had companies and Projects that ask us for example to collaborate on this and develop Yeah, new implementations for new languages. So that's something that we could also collaborate with other projects And once we are we have a device which can operate or completely offline. We will Get much more applications possible like like in security environments like like in medical applications or other applications babe You shouldn't be dependent from other systems and should be to complete an independent. It is also a very big privacy thing Yeah, I find this point what you just mentioned with the Offline very very important. Yeah, and because okay once we have many people in Asia They don't always have like good access to to the internet and actually it's also the case in Germany that not everyone has always good access to the internet But like also from the privacy standpoint, I mean, why should I Contact or like Why should I ask my cloud service to switch on my local music player and play my Private music library. Why do I have to connect to the cloud to do that? I don't have to do that so one thing That we are working on is like only connect to the cloud if you really need it and Secondly, if you're not connected to the internet then Like try to support as much as possible offline So even if people say or I want the the awesome voice Online from this service or when it's offline it could still maybe have like the the basic Basic voice or something like that implementation or it could have basic services So this is really an important goal in this project that as much as possible should work offline And people who don't want to share their data with cloud services They they don't have to share their data or they don't have to share any Cloud information or they Trust a service and and this service could delete the data potentially Okay, so I would like to go back to what we mentioned earlier the language of our thoughts how to Make skew with Susie skew CMS Okay, so basically this is an interface of Skew and there are only a lot of Skew written by the community available on the Website if you want to just to inspect some of the action type you can just go there and Look at the website and then we gonna do not really the demo. We're gonna show you quickly how to How you can create a skew Okay, so before you before you create a skew For people who don't have a knowledge In this yet and who want to try out themselves so we implement something called Explained and analyze and this is got we got inspired by the Westworld theory I Think the people aware of you seen this theory, right? Yeah, raise your hand if you have seen this Okay, so most of you so We don't have to explain in the Okay, so so basically The analy is a debugging system when Let's say a robot or personal assistant give you the answer that you ask us a question Where actually the answer come from so this is what happened in Westworld and we implement Similar thing so when you get the answer that you are not happy with or you're curious where Susie give you this answer You can type in explain and it gives you the answer of which data and which channel How come they provide you the answer and I think that's something this is something that's really cool So you can inspect play different components and different code that Come come that make up this skill So at the moment, I think that would you can type explain and analyze great. Yeah And then Another layer is after they give you this plan of the skill you ask again the same question So it's playing again. What is that review skills come from? How far can it go on? Have you So it will explain where the explain skill is actually stored and so people can Analyze this expense skill and in the visual interface you will have a link So I think it's also like we're talking a lot about voice, but actually and this is already something that is different to Alexa and and Google and there is no Alexa chat where you can chat with Alexa through a UI But for us like it doesn't matter like the output from the server is a JSON file and whatever client you implement It can work So here it's it's a visual client, but you could also have an audio only client Okay, so this is to debug the answer Yeah, and then how can you really a Skill so just to repeat it again a skill is a drawer or rule says that produce answer to question Very simple. So if you go to chat doc Susie dot AI and On the right hand side on the left hand side on the right hand side you click on the burger and then it will show skill You need to lock in you need to read an account in order to to read your skill and So as I mentioned before if you look at Alexa Siri container or Google now you need to Have the knowledge either Java, Python or C++ in order to write a skill But you don't need that for for Susie AI We prepare we have prepared a few example for you We're gonna present now the fourth example for something very simple and easy which is fix Curie in answer So basically if you run a business and which you just want to raise some kind of a seed and Assistant that stay that have a funny conversation with your user As you see on the ball roses red Susie is a hack you can try so one and Once the first sense then either the question and the second sense and is the answer which is to both How Susie respond back to the user and you can go on go on if you have time you can sit down and write like Thousand line of question and answer just to create something funny and this would be in turn I think also in Alexa with a many skill so fix a question and answer and another type of Skill which is random answer in question so you can divide Random answer for the specific question in this case What is your favorite dish and you can already divide? What do you want Susie to answer or? in the system and It also reverse on the other way so you can provide one answer for different question that being asked by the user so in order to To make it close to the Effective I will put the more question that you create here the the closer It's get to the answer Why cause? This is the pattern you want to continue with the pattern So we know we have seen two simple examples of the Susie skilling which Which it looks like simply text now it gets more into more details which look more like programming So what we what we did is a language which is so simple that you actually don't think this is a programming language It's like we wanted to have a disruptive Situations like when the Wikipedia came it was easy to write Content because you just write text and before the Wikipedia You had to if you wanted to make a web page I mean wanted to make content you have to write HTML which is not for everyone. So this is the same with our Skill language you're not doing programming anymore. You're just writing down the sentences and it you have seen only the Most simple examples now it gets more complex. So the the star is just a placeholder where you can put in anything next So more examples where I can use this and you can fill in the content which had matched with the star And it use it in the sentence again So this is basically what was also invented with Eliza more than 30 years ago. So not Really sophisticated, but that's the beginning of the story next you can have some You can trigger some memory. So if you Use this creator symbol you can store it in a variable and use the content of the variable afterwards So Susie is able to have a memory of what was in the chat history Next Yeah, this is an example where I can use random answers for getting The result from something called function color, it's not actually a function definition But it's just a helper method which explains what's reflection in Susie So Susie can use a Susie skill to fill in some part of its answer and in this case Susie is trying to find color which it likes and if you ask it the first time it takes a random color And if you ask it a second time it remembers what it took before and prints out the same thing. So in the Second intent you see here. What is your favorite color? It decides is the color set then it prints out my favorite color is the color which is set or if it's not set it's it's it's saying I like and then The reflection takes part of function color and it's stored in the variable So it remembers this the next time Yeah so if you want to have an embed JavaScript you can Use that bang symbol to have some scripting inside. We are planning to do more scripting languages inside most interestingly like prolog or other languages which are popular Next and this is this is finally What is most important to get information from other webpages? So if you want to have content from another web page like a sports page and you could discover that this page has a JSON API and you get information from the JSON API you can use that JSON API so the most simple thing is to mention only two things from that external API and that that it's the URL itself and Another thing is the JSON path. So that's a declaration you do with that so-called console rule it's using one URL and the path to the JSON object which is called articles at articles you find a search result list and the first hit is then given in the answer line which is the title and the URL so Results lists are very important in in Susie because Using backtracking and that's a concept from logical programming using backtracking. We could use Alternative answers. So Susie is able to think about possible results how to create a private Susie chat board and This is something that's very simple Again, do the same interface To go to chatstocksusie.ai and instead of Create a skill you can create a chatbot and you can easily Follow The four step of how to create a chatbot and Interate it into your own website. I think the interesting thing for a chatbot So what is the difference between a chatbot and a skill? so a chatbot is a private is a private skill basically, yeah, and Originally, we had the idea to make everything open Yeah, let's make people like open source as much as possible but there are maybe private APIs or keys that people use to access web services and That is Reason why yeah chatbot could be good and also you can embed it on your website so you can click on JavaScript code for example and Yeah, go through it. Maybe yeah, let's go through the tabs steps. Okay, so so for example here is also another interesting feature if you have a chatbot then you want your chatbot to look like Maybe like your website or like your favorite design So you could for example add a picture or change the color and add your own little icon Or your own picture for the answers. So all that is possible here. And yeah, there's a small icon They're up there when you can try it out So you can switch to a view Visual a visual view or code view. Yeah, so both is possible just like in HTML then they are the next step is That we're adding options. For example limit a chatbot only to a certain website or to number of certain websites And yeah include Susie AI skills So there are many default skills and Susie AI if you don't want them if you want the chatbot only communicates what you tell Susie AI in your skill and then you can limit that as well. And yeah, of course There are many more features that we could imagine and and yeah in the final step.  I think that We run it now of time and I think We share already explained in the beginning. Yeah, how we view a speaker Should we show the Do we still have time for Yes Yeah Yes, so If you want to get involved and want to have to be an open source Personal assistant all of our development are open. You can find information on for Asia GitHub and there is a video How to make the speakers also on pink reverse And We if you want to connect with us, we have a Susie Gitter channel Our developers are there. Basically, you can always get an answer from from the community It's just We are working on it But yeah, so so we need to collect more and so form from the community be able to yeah, but it is a good idea Yeah, but some people the dream what it's on the opens of community. They want to interact with other people So this yeah, so this is the drop-up of our presentation There's so many area that Susie I Want to conquer like so for desktop browser Mobile tablet and many more so but we all know that Open always wins so the next thing for us is to To have a Susie as a solution and offer services around Susie and We hope that you join our development and get in touch with us so that we can build The open conversational web together and if you have any idea of your web any project out there already that doing similar thing Please connect them with us It's one more thing so in two in March this year 14 to 17 they're gonna be our 10 anniversary of the first Asia summit if you happen to be in Singapore, please join us Many of the Susie developers will be there. We have dedicated to work shop We will work on this and fixing bugs improving the system So check out our website 2019.forceasia.org if you want to meet out in Singapore Thank you very much for your attention And I would also like to take the strength to thank you the organizer and the volunteers for making the video and Having us here today. Thank you very much for your hard work


TFNN headline news update Good afternoon everybody I'm Tommy O'Brien company live from TFNN headquarters in St. Petersburg, Florida 1 p.m. Eastern time on Friday three hours left to go in the trading week and we have a relatively calm market as in nearing flap But we've had volatility in both directions this morning right now You have the S&P is negative by three points trading at 2875. We get the Dow Jones up 25 points Dow had been down negative 200 or even more than that coming into the opening bell Dow up 25 points trading 25,886 and the Nasdaq negative 28 points at 7870 Goal contract negative ten dollars and 70 cents at 12 75 50 You got oil negative nine pennies at 62 78 and the dollar index up a hundred and two ticks at 97 780 We'll start it off. Let's jump over the futures markets We'll start it off with the Dow so quite an acceleration as we've been saying right out of the opening gate 9 30 this morning We're trading 25,631. We're now up more than 200 points from that level made it as high as 25,946 Currently 25885 Nasdaq 100 pretty similar action We trade higher from the opening bell highs at around 11 15 a.m. This morning backing off a bit 75 69 the Nasdaq 100 S&Ps we reached a high at about 11 15 as well 28 87 We're now 12 points about off that level 28 75 and that June S&P contract Crude oil backing off a bit on a couple occasions. We were up there 6 30 this morning at 63 63 And then it again about 11 a.m 63 58 and then we saw quite a little sell-off about a dollar to the downside Reaching a low within the last hour of 62 53 currently trading 62 78 gold contract trading lower Going for session lows that we had pretty much right at that 12 75 So we'll see where we trade from here, but gold trading 12 75 55 and the euro us dollar one 11 63 terms of some of the movers and shakers out there jump over Pinterest quite a number on their earnings last night But getting a little bit of a bid as in data 11 percent had been as low as 24 74 last night Some of the chip stocks aim at spiked higher on their earnings pulled back a bit and then traded higher Cisco as well trading higher at about 1 percent in tesla with some woes as another story of their autopilot tesla Down more than 4 percent today Stay tuned folks We've got a man steve rhodes coming up right now with the trader's edge Dave white live at 2 o'clock with the power trading hour Tom o'brien finishes off the week live at 3. Stay tuned folks. Have a great Friday


Hi, wrth gwrs. Welcome to the 12th meeting in 2024 of the Delegated Powers and Law Reform Committee. We've received a apology today from Tim Eagle MSP, and in his place I welcome Alexander Stewart MSP. I'd like to remind everyone to please switch off or put to silent mobile phones and electronic devices. So the first item of business is a declaration of interests in accordance with section 3 of the code of conduct. Invite Alexander Stewart MSP to declare any interests relevant to the remit of the committee. Thank you and good morning, convener. Delighted to be here, but I have no relevant information to give the committee at this stage. Okay, thank you very much for that, Alexander, and welcome to the committee. The next item of business is to decide whether to take items 7 and 8 in private. Is the committee content to take these items in private? Under agenda item number 3, we're taking evidence on judicial factors at Scotland Bill. Can I welcome Patrick Layden Casey, TD, the former lead commissioner, and Charles Garland, the interim chief executive of the Scottish Law Commission. Welcome to the committee, Gents. Can I remind the attendees to, first of all, not to worry about turning on the microphones during the session as they are controlled by broadcasting? And also, if you'd like to come in on any question, please just raise your hand to catch my or indicate to the clerks and they'll bring you in. Before we move to questions, can I invite Patrick Layden to make some brief opening remarks? Thank you, Chairman. It's sometimes, since I retired from working as a Scottish Law Commissioner, and I'm privileged to be allowed to appear here today to represent the commission. We welcome the decision of the Scottish Government to bring forward legislation to implement the commission's report on judicial factors. The subject is one which exemplifies the rationale for the existence of the commission. It's an area of law of continuing value to the citizens of Scotland. It is in need of reform, and it is not politically sensitive. It is precisely the kind of topic which the commission is ideally placed to address. Judicial factors are a homegrown institution developed to deal with a continuing need, that is, the holding administration and protection of property where it is not possible, practical or sensible for those responsible for the property to carry out those functions. Before the union with England, appointments of judicial factors were made by legislation of the Scottish Parliament, the Scottish Privy Council and by the Court of Session. After the union, appointments were made by the Court of Session, which also made it acts of sederant to regulate the institution. Acts of sederant are a form of subordinate legislation, nowadays generally limited to regulating court procedure. Formerly, they had a wider remit. It is recorded that in the 1750s, the court made an act of sederant requiring striking Edinburgh brewers to return to work, demonstrating that then, as now, the court had its finger on the capital's pulse. The Scottish Law Commission did some work on judicial factors in the 1970s, culminating in a report on the powers of judicial factors, which was produced in 1980. The subject was put on the commission's agenda again in 1990, but work was interrupted by other projects, including references from the Government. The discussion paper was, however, published in 2010. In the light of the responses to the proposals and questions in that paper, the commission prepared a final report with a draft bill that was submitted to the Scottish Government in 2013. I should perhaps say that, as a rule, the Scottish Law Commission seeks to reflect consultee's knowledge and expertise in formulating its proposals. Where the views of those consulted tend in a particular direction, the commission itself will normally move in that direction in its report and any attached draft legislation. The current bill largely follows the commission's recommendations. Some changes have been made following the Scottish Government's separate consultation and developments in drafting practices have led to some stylistic alterations, but the general thrust and content of the legislation are as recommended by the commission. Broadly, the bill does not seek to regulate every aspect of the operation of judicial factories. Rather, it seeks to establish the parameters within which a well-established and successful institution can operate better at the present and to develop further in the future. It extends the jurisdiction of the sheriff court, so that the jurisdiction of that court and the court of session is broadly concurrent. It leaves in place the discretion of the court of session to take account of future contingencies, so that if circumstances arise which have not occurred previously, but would be appropriate to appoint a judicial factor, that can be done without difficulty. On behalf of the Scottish Law Commission, I have great pleasure in commending the bill to the committee. My opening question has already been answered. I will ask, as an opener for the committee, whether the bill—although, as you indicated, there are some changes in contrast to the draft bill from the Scottish Law Commission. Are you content that the bill still has the ethos and the wider considerations? Yes, it is very recognisable. It is the same piece of legislation. Two organisations that responded to the committee's consultation missing people in the law society have said that the bill could have done more to address the needs of families where people go missing. In what ways do you consider the group during the policy development of the proposals and can you highlight any parts of the bill that you think will improve the situation for those families? That is my first question. The bill, the legislation, will enable the appointment of a judicial factor wherever that is required. If somebody has gone missing and has enough property for anyone to require administration, it will be competent to apply to appoint a judicial factor to look after that property. The bill works and the family of somebody who has gone missing would be able to ask for a judicial factor to be appointed to look after that property. As I read the concerns from the missing person's written evidence, they are worried about the procedure that might have to be gone through, about the cost of going to court, about the technical requirements that might get in the way of ordinary folk just going along and getting somebody appointed. That is not something that can be addressed in the primary legislation. It can be addressed by the way in which the act, as it will then be, is advertised. It could be addressed in guidance, given to citizens advice bureaus, so that information about how to get to the court and appoint a judicial factor could be disseminated. It could be addressed by providing for a court procedure that would enable folk who are not legally qualified to make the appropriate application. Nothing in the legislation will prevent that, but as the missing person's organisation says, one of the things that you have to take account of is that if somebody has gone missing and somebody else has appointed as his judicial factor, that is a risk that the property involved may not be used as it should be, and that is one of the things in which the legislation addresses. Following on from that, the Charity Law Association has also said that the bill pays little regard to the role of judicial factors in the charity sector. How would you respond to the policy concerns and can you highlight the parts of the bill that you think show that a child with a sector has not been overlooked in this process? There have not been overlooked in the sense that the Charities Act expressly provides for the appointment of a judicial factor to the affairs of a charity, but I am conscious that in the functions conferred on judicial factors, on the powers that they have and the duties that they have, which are all rolled up as functions in the Government's bill, there is nothing said about a continuing duty to distribute property. Of course, it may well be that a charity to which a judicial factor is appointed has enough money to carry on operating as a charity and a continuing duty or discretion to distribute money to the proposed beneficiaries of the charity. There is nothing expressly in the judicial factors legislation that deals with that, so it may be. There is one other difficulty, but there is one other difficulty about intimation to those interested in the estate. If it is a charity with a wide remit, then that might be quite a lot of people and intimation to each of them would be impossible. It may be that the particular requirements of a judicial factory in relation to a charity may justify the inclusion of specific provision in sections 3, 15, 27 and schedule 1. Charities people will no doubt make it themselves and at the end of the process the Government will be able to say what they are proposing to do about those concerns and what it is worth. They seem to me to be legitimate concerns and there would be a way of addressing them. In relation to information-gathering powers in both sections 12 and 39 of the bill, there is an exception for the requirements to comply. This is for the UK Government ministers, departments and bodies who exercise functions such as HMRC, and they can choose whether to comply. That might be one really for the Scottish Government to answer, but can you explain the rationale for those exceptions and, separately, what policy impact do you think the exceptions will have in practice? The rationale is that the Scottish Parliament cannot impose duties on UK Government departments. That is a matter of the Scotland Act. I myself would not have thought that it would make any practical difference to the operation of the legislation. There are court decrees and request for information and administrative co-operation going on at all levels between relevant authorities in Scotland and the rest of the UK. The provision of information to a judicial factor appointed by a share of court or the court of session in Scotland is not going to be met with any difficulties. I do not see it as a practical problem. It is one that has to be worked round because of the structure of the devolution settlement, but it is not something that will, in my view, cause any practical difficulties. Just before we move on, in this particular question, I hesitate to ask this question, would section 104 order be of use in this regard? Yes. You will find that it was covered in the commission's report, and we have put in a draft section 104 order that was prepared, and no doubt life will have moved on. What will eventually be produced will not be the same as what is at the tail end of the report, but something along those lines will be put in place. At least that was the Government's intention. I move on to section 4 of the bill. Under the section, the main qualification required to be appointed as a judicial factor is that the court considers a person suitable for that role. In response to the committee's call for views, some respondents such as missing people supported this approach. Others wanted the bill to be more prescriptive. Property Mark, for example, wanted professional qualifications to be specified. Did the commission consider an approach that would involve specifying in statute that professional qualifications are required for some circumstances where judicial factors are appointed, but not others? I think that we did, but I am thinking back 14 years now, so I am not going to swear to it. As I said in my opening statement, we are providing a general structure, a general framework for the appointment and operation of judicial factors. I think that it is a matter of horses for courses. If, as is normally the case, you are administering an estate with quite a lot of money in it, and quite a lot of legal ramifications, it would be appropriate to have us solicitor appointed. In other cases, perhaps if, as apparently frequently happens, you get a husband and wife who are partners in a farming business, they run a farm and they fall out and they cannot bring themselves to agree to even the sensible decisions to keep the farm going, then a judicial factor in a case like that would ideally be a farmer, somebody who could make those decisions and carry them out and make it work, and a legal qualification would be singularly out of place. The legislation enables the court to take account of the circumstances of the particular estate and to appoint an appropriate person to deal with it. I do not think that it would be sensible to go further than that. I know that the estate agents are putting in a plea specifically of estate agents, and we would not have done that. The court has the power to appoint the person who is best qualified and I think that it is sufficient to deal with it then. The other evidence that we did receive came in from the Faculty of Procurators of Caithness. In their submission, the court suggested that we are firmly of the view that whatever other provisions may be made, the judicial factor should be wholly independent of the Law Society of Scotland, and there should be explicit prohibition of any current officer or employee of the Law Society of Scotland being appointed as the judicial factor. Do you agree with their suggestion in the comments? No. The Law Society has a duty to make sure that solicitors act properly in the interests of their clients. As I understand it, it will be able to tell you when they come and give evidence, as I understand it. It is only where a solicitor's affairs are getting into such a state of confusion that they have fears for their clients' money that they will intervene. They have to do that, as they would say, regrettably often—not very often, but more than they would like. It seemed to me personally, when I was talking it over with the Law Society, because we had consultation and we had meetings with the Law Society in particular, that having a solicitor on staff who could act as a judicial factor in a range of cases was a very sensible way forward, unless I have the disadvantage of not having read anything more that the faculty of procurators of Caithness said they may have had a bad experience up in Caithness, I do not know. However, from my perspective, from the commission's perspective, the arrangements that the Law Society has put in place seem to be eminently sensible. I have one final question in this area. You will be aware of the situation that happened with McLeur's solicitors, I would imagine. No, they were a firm based in Greenock, out of 14 offices UK-wide and the firm into liquidation in 2021. Certainly, the discussions that I have had with a range of constituents and individuals from the legal fraternity who have reached out to me were one question that has been put consistently, and that was why the Law Society would not have instigated a judicial factor in the situation to deal with McLeur's. McLeur's had estimated 19,000 individuals with trusts, about 63,000 wills and around 20,000 powers of attorney. Certainly, McLeur had a lot of clients. The question has been put consistently, why was not a judicial factor introduced? I have met the Law Society and they have given me an explanation as to why one was not. I think that the explanation certainly seemed to be very fair and rational, but certainly in the circumstances that I have outlined, and in your past experience, would a judicial factor be something that would have been worth considering? It is certainly the kind of case where an application for the appointment of a judicial factor could competently be made, but I am not in a position to second guess the rationale or otherwise of what the Law Society decided. You have spoken to it and you are in a better position than I am to judge it. All I can do is to hope that we have set up a system that would enable the appointment to be made in appropriate cases. From what you say, that sounds like an appropriate case, but every case has its own features that make it difficult to advise about. No problem, no thank you. I just wanted to follow up on that. You said that it does not happen all the time, but regrettably often, the Law Society is in the position of having to step in or put a judicial factor in place. I wondered off the back of McLeures, but also other cases, whether there is a conflict between the Law Society regulating the work of solicitors and putting a factor in place to take over when something goes wrong and whether that was something that was considered in how the bill was drafted. Obviously, it seeks to consolidate the law, but there are still a number of other pieces of legislation on the statute book that give the power to appoint a judicial factor in specific circumstances. It is just whether there was a thought to bring it all into the legislation and why it did not. Secondly, whether there are still some situations as a result of that, where it is not as clear as it could be the exact responsibilities when it comes to appoint a judicial factor. There is always attention, speaking now about the practical business of setting out legislation. There is always attention about where is the best place to put a provision. This bill gives general provision about judicial factors. You are absolutely right that there are a number of other bits of the law where judicial factors are allowed to be appointed. We have talked about charities in the 2005 act. The Law Society has a power to do it under the 1980s Solicitor Scotland act. The reason we did not take them out of those provisions and bring them into our bill is because they are sufficiently separate that if you were trying to find out what happened when solicitors did not act properly, the place that you would look to find out is in the Solicitor Scotland act 1980. That is the code for solicitors. If you are looking for whether a judicial factor could be appointed to a charity, you would like to find it in the Charity and Trustees Investment act, Scotland act 2005. That is the logical place to look for it, so we left them there. I am sure that you know that, in relation to the proceeds of crime, there are people who are appointed to look after the estate and the property that has been confiscated pending a court decision. They look very alike, all but the name, judicial factors. The people who put that legislation together decided to put their administrator of property into their legislation rather than hark back to judicial factors. As a matter of legal policy, the Government will say that it is all in one place, and as a matter of drafting practice and drafting discretion, it will say that we will amend the Solicitor Scotland act to take account of that matter. However, we will not take the provisions out of there and put them in our bill, because that is the sensible place to leave them. I am not sure whether that answers your question. You know that it certainly starts to answer it, so I guess for clarity where you have left provisions untouched in other legislation and just made minor amendments to reference this legislation, the commission was broadly happy with how those provisions in other legislation operate at the moment, because there would have been a chance through this to potentially amend some of those, if there has been a policy reason for doing so. I apologise. I may have missed the first part of your question, which was that a possibility of a conflict of interest in the Solicitor Scotland act and the way in which solicitors are responsible for supervising the operation of individual solicitors and also appointing judicial factors to look after them. It may be that what was behind your question was that the solicitor's administrative body, whatever they call it at the moment, the council of the law society, was not keen on appointing judicial factors because it looks bad for the profession. I am totally making it a general kind of statement. I suppose that there is always a general feeling that the people who run a particular profession are perhaps not the best people to look into possible defects in the operation. The great safeguard that you have in relation to solicitors is that the law society has an interest in making sure that solicitors operate properly. It also has an interest in looking after the wider interests of the profession because, if a solicitor defaults and his clients lose money, all the other solicitors have to contribute to making that up. The existence of the solicitors guarantee fund, if you like, ensures that the appropriate bodies in the law society are not over-influenced by the reputational damage that might be done to the profession if individuals are taken out of practice and the judicial factor is appointed. That is a very crude way of putting it, but… That is helpful. What I was really wondering is whether you have—where there are these provisions for appointing judicial factors in other legislation, you have looked at those as the commission has looked at those and you are broadly happy with them because, obviously, this bill would have been a chance to change them. Yes, it would. We could have taken them out and put them in our bill and changed them and modified them. No, we might not have modified them because the policy in the 1980 act is for the 1980 act. We would not have changed that without widening our scope quite a lot because that is a matter of the regulation of solicitors, not the regulation of judicial factors, but we could certainly have taken the provisions out of the 1980 act and put them into our bill. For the reasons that I have tried to explain, we did not do that. That is helpful, so you felt changing those policies in other legislations out of school for this bill. It would have widened it beyond your interest. We would have thought that that was beyond our scope, beyond the scope of the project. That is helpful. Thank you very much, convener. Thank you for your responses today. It has been very helpful. Can I ask that, in section 5 of the judicial factors bill, it would abolish the requirement to find cases to save in exceptional circumstances. One policy justification for that is that, when a professional is appointed as a judicial factor, they will have professional indemnity insurance. In response to your discussion paper in 2010, the accountant of court said that she thought that the scope of accountant's professional indemnity insurance might not be as broad as it is generally thought, and it might not cover embezzlement by accountants. Did the commission resolve that concern when it was raised when developing your policy on section 5? The change that section 5 makes is in relaxing the requirement to find cation. Previously, at present, it is a requirement, in every case, for the judicial factor to find cation. It is a guarantee that he or she will not—or if he or she does—default with the money, or that there will be somebody else to pick up the bill. I am told that cation is not difficult to get, but it costs money. The expense is something that you would try to avoid if it is at all possible. The absolute requirement has been changed into a discretionary matter for the court. I have absolutely no idea what the accountants' concerns about professional indemnity insurance for accountants has on the finding of cation in appropriate cases. I cannot help you with that. I know why section 5 says what it says, but it had nothing to do with my recollection. It had nothing to do with the profession of indemnity insurance for accountants. The accountant will not be able to tell you what her concerns were. That would be useful. Thank you very much. We can maybe delve a bit deeper on that basis. In response to the committee's call for views, the University of Aberdeen and R3 said that they thought that the threshold for requiring cation in section 5 is actually too high now. Do you have any comments on that? For example, does the phrase, exceptional circumstances fit with the general policy desire to make judicial factors a solution for the families with missing relatives? As the missing persons people said, it is possible that in a family situation you might feel that it was very desirable for whoever was appointed as the judicial factor to find cation because they may not be the professionals who are operating a judicial factory in a disinterested and arms-length manner. It is possible that they might have much more of an interest and so it is possible that those are the circumstances that might make it desirable to consider the requirement to find cation. I really cannot say. Every case will be different and the court appointing the judicial factor will have to take all the circumstances into account. However, the intention was to make it less routine to require judicial factors to find cation. Whether exceptional circumstances are the right test or a matter for judgment, the Government will be able to explain its thinking on the matter when it comes along to give evidence. Part 2 of the bill proposes various powers and duties for a judicial factor in response to the committee's call for views. The faculty of advocates said that it would be desirable to give the judicial factor additional powers to seek directions from the appointing court. I must be used, for example, in the event of a dispute or uncertainty about what steps the factor should take. Is that something that the commission would like to comment on as a policy idea? There is a power in section 11 that enables the court to withdraw or retain or keep back from a particular appointment some of the functions set out in the legislation. There is a power in section 11 for the person concerned, the factor concerned, to go to the court and ask for additional powers. I did not quite understand what point the faculty was making. I think from the submission that they are saying that there are circumstances in which someone could be appointed and then there could be a dispute about how they carry out their functions and that it may be helpful for that individual to be able to go back to the court. I seek clarification that what they were doing was in order and was consistent, I guess, with the powers that they had been appointed to use. I am still not entirely sure that I have grasped the essence of what the faculty's concern is. Is something that the committee can take up with the faculty when we are likely to hear from them? Perhaps we could send you further detail of that and then have the chance to comment on that. At the moment, the factor that is in some doubt about whether or not what he is doing, what she is doing, is within the functions that have been conferred would discuss the matter with the accountant of court. If it was some positive action that was in question, something that he was going to do, then he can go to the court and ask for an extra power to do that. But the aim of schedule 1 was to set out in very general terms a very wide range of powers. It has always been possible for judicial factors to go back to the court and say, does that mean that I can also do X? Indeed, one of the reasons for putting all the powers into schedule 1 was to stop people having to go back to the court and say, can I do X? X is now in schedule 1, but there may still be cases where things have to happen that are not envisaged in schedule 1. You can go back to the court and fix that. Otherwise, the factors are appointed to make decisions. The court has frequently emphasised that they are not going to authorise the factor to do this out of the other. They expect the factor to use its own discretion, and you might say, we are not going to stop you doing this whether you do it or not is your business. That is the point about judicial factors. That is what makes them a sort of unique office. It is the fact that they are being appointed to exercise a discretion, under control, under supervision but nevertheless to exercise a discretion. I think that that is helpful, and that probably speaks to the policy intent as things are currently drafted. I also wanted to ask about section 19 of the bill, which covers the investment power of a judicial factor in respect of the estate. Following the approach in the Trust and Succession Scotland Act 2014, I wondered if it should be made clear on the face of the legislation that a judicial factor could choose environmental, social and governance investments, even if those might not lead to maximum income for the estate. That was a change that the committee had recommended in our report on that legislation, reflecting, changing thinking on environmental, social and governance issues. Would that be an amendment to section 17 that you would be after then? That would probably be in section 19, but that would be up to drafting colleagues, and probably in section 17. 17 is about investment, and I apologise for the wrong section. The duty of the factor is not to give effect to the Government's views on appropriate investment. The duty of the factor is to maintain the estate for the ultimate benefit of those who are entitled to it. If I were a factor, I would be very cautious about taking into account considerations other than the general financial parameters within which investment takes place. I guess, for example, that factor was put in place, and they were thinking about the reputation of the organisation, and it might be that in strict financial terms you could get a better return on investment by going with option 1. Option 2 might produce a lower short-term return, but it would be more consistent with the organisation's values, wider public image. I guess, that was the scenario that we were thinking about in relation to the trust and succession. I think that the factor would be taking a risk. How much of a risk he is prepared to take is a matter for him, but at the end of the day, I do not see what answer he would have. If somebody said that option A would have produced a 10 per cent return and chose option B, which produces a 5 per cent return, you should account to us for the missing 5 per cent. I guess, that is why we were asking about whether it should be on the face of the bill. That is a matter of policy. At the moment, the object of appointing a factor is for him to maintain the estate and generally manage it properly in the interests of the ultimate beneficiary. If the policy were to require a factor to do something other than that, I think that it would have to be very clearly stated in the legislation. I am not for me to say whether it is appropriate in this case. I am not responsible for the policy. The bill is consistent with a duty on the factor to maintain the estate in financial real terms for the benefit of the ultimate beneficiary. That is the limit of the office at the present. If there is a policy that the factor should be doing something else, something more or something less, that would need to be very carefully thought through and drafted. However, whether it gets drafted is a matter of a Parliament. As somebody once said, bills are made to pass, and razors are made to sell. Thank you. So, Charles, did you want to come in? Thank you, Camilla. I will just add a small comment that judicial factor is, generally speaking, that will have a different timescale than trusts. Many trusts will be set up for the long term, at least for the medium term. The importance of the ESG option, if you like, might be more of an issue than in a judicial factory where the primary interest is in holding and administering and then giving back, if that can be possible, the estate. It might be that it takes slightly less of a focal position, although I know that some judicial factories end up staying in place for a very long time. That is helpful, thank you. I will just follow on from that point then, Charles. If there was a judicial factor in place for a long period of time, would the bill, as it currently stands, provide them with that flexibility? Notwithstanding the question that Oliver asked regarding the ESG, would the bill provide them with that flexibility to consider other investments or the way to invest, or should an amendment come forward to provide the ESG, would that then be helpful in that regard? As I understand it, the bill, as it stands, does not have the, certainly not the express powers that are now in the Trust and Succession Scotland Act. Whether they would be appropriate is another issue. Schedule 1 has a long list of different powers. It might be unusual, I suppose, for a judicial factory to be anticipated at the outset to last for a long time. The case that I have in mind was one that was submitted in evidence to the commission a number of years ago and was affirming judicial factory, which was still in place, I think, 25 years after it had first been put in, but there was no evidence that there was any intention that that was how it was going to go at the outset, in which case these ESG investment powers might be better suited for at least medium or longer term funds. I am certainly not an expert on that, but there may be that anticipated timescale of a judicial factory, as opposed to a trust, might be an issue, Mr The Relevance of that part. A final question on that. Out of interest, with that one example, 25 years, it clearly is a long period of time. I do not think that anyone would have anticipated that length of time, but do you have any figures to hand in terms of the average length of time that a judicial factory would be in place? I do not, I am afraid. No, I do not. The accountant of court would be able to tell you definitively what the average length was. I imagine. That would be very helpful, and we could consider that. Academics from the University of Aberdeen and Abertau University, as well as R3, have all said that the fiduciary nature of the judicial factors duties needs to be spelled out explicitly in legislation. Professor Greer also thought that there needs to be a clear statement as to the legal remedies if there is a breach of those duties. What does the commission have a view on that? We said very clearly in our report that the essence of the institution was that it was fiduciary. That was based on several court decisions. Of course, we considered it frequently. Initially, in relation to whether or not a factor could charge professional fees for doing legal work on behalf of the estate, and the answer was no, he couldn't, because it would give him a conflict of interest between his duty as a factor and his professional position. It was, to our mind, a self-evident feature of the institution that it is fiduciary, so it wasn't necessary to say precisely what that meant in the legislation. It would be easy to set out what that meant in legislation, or would that be a difficult task? It would be very easy to say that this is fiduciary, but what does fiduciary mean in particular cases is more difficult. Unless you have a clear idea of where it is going to lead you, it is, in my view, better to leave it as a general understood principle, but without trying to tease out exactly what it might mean in individual cases. If you tease out what it means in five or six individual cases, some intelligent person will come along and say, but what about case seven? You haven't covered that, and therefore perhaps it doesn't extend to case seven. If you leave it as a general principle, the courts know what they think it means at present, and if they decide to change that in the future in light of further change in circumstances, they will be able to do that without having to wrestle their way around an unfortunate phrase in an act of Parliament. In response to the committee's call for views of the Law Society in relation to section 15, the duty to make a management plan and section 16, the duty to submit accounts to accounting of court, it thought that the requirements of the bill were more prescriptive, so the opposite challenge than in relation to the commission's draft bill. Do you think that the bill that we see now is more prescriptive than what the commission had in mind? I haven't looked at that particular aspect. If there are changes between what we suggested and what the Government has decided to implement, those changes will have been informed by considerations within Government, and you will have to ask them what effect they thought they were having and what the policy was for making those changes. Okay, thank you. Thank you, and if I switch over. Thank you, convener. I've got a couple of questions for you. The faculty of advocates and the sheriffs and summary sheriffs association have both said that section 23 of the bill could be modified. This would be to deal with exceptional circumstances when a judicial factor had acted unreasonably but not negligently in relation to the litigation and so could be found personally liable for legal cost. Does the commission have any comments on the current policy and drafting of section 23? Before a judicial factor started or became involved in litigation, he would certainly consult the accountant of court and he would certainly take separate professional legal advice as to the prospects of winning or losing or the decidability of fighting the case. It is still possible that having taken that advice and acted in accordance with it, he might be found at the end of the day or he might be thought at the end of the day to have acted unreasonably. I imagine that very many people who get involved in litigation and lose wonder why they did it and whether it was actually worth it. It is the decision that you make when you start. Whether or not it is desirable to make a factor personally liable for a decision at the end of the day that he has acted unreasonably, even though he went through all the correct advice-taking procedures, is a matter of policy, but it would have the effect that a judicial factor might be more reluctant than is desirable to defend the interests of the factory estate in litigation because he is too concerned and legitimately concerned about his personal liabilities if the litigation turns out badly. If you are subsequently found to have acted unreasonably, we are going to make you personally liable for the costs of the litigation, but it would be a great disincentive to the factor to start the process. Whether or not you want to impose that disincentive is a matter of policy. I think that we thought at the time that the balance we had here was correct. If a factor acts improperly, then the court can make him find the money out of his own resources, but a factor who is acting in good faith and taking the proper advice and doing what he thinks is best in the interests of the estate ought not, according to this legislation, ought not to be penalised if somebody says at the end of the day why we think that that was unreasonable. It is reasonable to consider litigation, it is reasonable to consult the accountant, it is reasonable to take outside advice, and if the outside advice and the accountant's advice are all that this is a reasonable thing to do, it is quite difficult to say well, but we are going to come along later and do you for the expenses if you get it wrong, if the court decides the litigation against you, which is what it comes to and people who try and predict what courts are going to decide are intense with crystal balls. Thank you. My next question is section 34 of the bill sets out the rule that discharges usually frees the judicial factor from liability as a factor under civil law. Section 38 of the bill requires the accountant of court to report the court where serious misconduct or other material failures are found. The court then has discretion to dispose of the matter as it considers appropriate for the benefit of the committee. What is the commission's understanding of the interrelationships between the two provisions? Does the commission think that any drafting changes are required to improve clarity? The deal with different things, in terms of timing, it may be that section 38 would come into play before section 34. If the accountant thinks that a factor is doing something that is seriously wrong, misconduct, the accountant will report to the court and the court will take such action as it thinks appropriate. If the accountant thought that a factor had been engaging in that sort of action, there would be no question of her granting a discharge to the factor. The misconduct and the consequences of it would be an open question that would have to be resolved before you could consider granting the factor a discharge. That is an entirely separate exercise from saying that where the accountant has considered the factor's final accounts and final report, and has discharged the factor, that that should be the end of the matter. The factor must have finality. The finality comes from the accountant's inspection of his proceedings during the factory, and the accountant's acceptance after audit of the final accounts and the accountant's decision that the factor can be legitimately discharged. Once that has happened, there has been an adequate process to sort out the rights and wrongs or any questions about how the factor has acted and he has been discharged. He should then be able to say, right, that's all behind me, I've done that. I will carry on with life without people coming along later and saying, ah, but we don't think you should have done this three years ago. That's how I read the relationship between the two sections and that's what we were intending to do, and I think it's what we've achieved. Anything needs to be done to find the clarity or just to clarify things? I don't, but I'm always willing to be persuaded if somebody out there, if these gentlemen and ladies from Aberdeen think that there's clarification required, then they should say so, and I'm sure that the Government will always be willing to listen to ways of clarifying the legislation, but I mean that either of the sections may not be perfectly drafted in itself, although I haven't heard of any suggested defects, but that's always an open question for the draftsmen. Could I have got it better? Thank you very much, convener. This is a question about a role that you've covered not by yourself, but you've covered speaking here quite a wee bit this morning in the accountant of court, and there seems to be differentiation between not quite so much the role but who and how qualified those people are, that person is. In relation to sections 35 and 36 of the Bill of Law Society, it's commented on what it regards as a significant departure from the commission's draft bill and considered a watering down of the level of legal and accountancy knowledge required for the roles of the accountant and the deputy accountant. In the SLC's draft bill there were to be knowledgeable in matters of law and accounting, however in the current draft they must be in the opinion of the Scottish Courts and Tribunals Service appropriately qualified or experienced in law and accounting, and the policy memorandum to the bill makes it clear that formal qualifications are not necessarily required. So what's the commission think about that sort of approach to sections 35 and 36 and do you share the law society's concerns over these differentiations? The provision that we produced required the accountant to be qualified, as you say. The position in the bill is a lower qualification in formal terms and I think you would have to ask the Government why they had changed that and what their thinking was. Our thinking is in the report and the draft bill that we produced and I would say that was the appropriate thing to do because that's what we said in the report. If the Government wants to change it then that is a question for them and you would have to take it up with them. Do you think that the Government when it's formulating this approach may well look at what you've said but do you think they might approach you to get further clarification on what you're looking for because there does seem to be a bit of a differentiation there shall we say at least? I think our approach and our views are sufficiently set out in our report and I would not expect them to come back and say do you really mean that? No that's fair enough it's just that because there is such an element of divergence there I just wasn't 100 per cent sure and maybe it's not as as wide or anything as has been presented but there will be discussion over that. Somebody who is appropriately qualified or experienced in law and accounting would cover somebody who has all the qualifications that anyone might want but he might also be a person who without those formal qualifications is also suddenly up to speed on the various practical requirements of the position. I think that that's quite clear then actually but I just am reading it. No it's certainly a difference if this is the law society's point in terms of the formal qualification whether that is absolutely critical is a matter of judgment in this case the judgment of the Scottish Court of Tribunal service. Thank you very much for that thank you. Normally the Scottish Legal Compliance Commission the SLCC acts as a gatekeeper for all complaints about the solicitors in Scotland although a complaint about conduct may be referred back to the law society to determine office substance. With section 38 of the bill which places a duty of the accountants to report misconduct or failure of a judicial factor to their professional body is there a potential policy issue with A by passing the usual role of the SLCC and B applying different thresholds for referral to the law society than the SLCC is required to apply? The short answer is that I don't know. The provision says what it does the professional body is the if the judicial factor is a solicitor the professional body is the law society. I don't think we had any intention of bypassing any other disciplinary or investigative body if that's it would be I cannot see that there would be any particular problem in doing that you could say body includes any other body appointed to investigate professional failures or what have you but professional body in this case would cover the case where the judicial factor was an accountant it would cover the case where the judicial factor was an estate agent if the estate agents get their way it would cover a professional body of any sort if the judicial factor was a member of that body and it was a relevant consideration if you're asking whether body should be extended in another provision to include any separate disciplinary mechanism then yes obviously it could happen it's not in the bill at present but it could very easily I imagine be added. In response to the committee's call for views the faculty of procurators of Keith Ness said it thought there should be a specific procedure for an interested person or organisation to his concerns about the judicial factors management of the estate this if proposed would first be to the accountant and if unsatisfies with outcome there would then be a role for the court what does the commission think of this as a policy proposal and for the benefit of the committee could you identify any benefits and drawbacks of this proposal? The major difference between judicial factors and ordinary trustees and in very many ways a judicial factor is a trustee but the major difference between a judicial factor and a trustee is that the factor is closely and consistently monitored by the accountant of court the court appoints a factor to look after the estate that's what makes him a judicial factor but that is done under the supervision of the accountant and so you have a clear responsibility on the accountant to make sure that the factor is operating correctly I would want this is pure legal policy you know if you want to have a situation in which somebody who complains to the accountant doesn't like the answer and then go to the court and so on up the deal system you can do that I personally would want to see evidence that the present system was not working that there was a case where the accountant had had demonstrably failed to take account of some obvious defect in the way the factor was operating before I looked for other solutions to it it is very easy to say oh well you must have a way of fixing this and so on it it has serious resource implications and serious implications for the judgments which factors and accountants have to take if you import a new way of attempting to second guess what the system operates the way the system operates you could do it but you'd want evidence one of the things I used to do before I was a law commissioner was get involved in judicial review and judicial review is essentially where our public body is said not to be operating properly and not not acting reasonably or what have you and you used to find that in many areas of the law a person in a particular position a judge or a lord advocate or a minister or what have you had a discretion which the courts had always recognised and which they wouldn't interfere with if x says this is the right thing to do then we are not going to try and second guess that and that only lasts until x does something which is so off the wall that something really needs to be done about it and that has happened in a number of areas of government and local authority operation that yes x has the discretion it says so in the statute and we must let him mustn't interfere with that until he does something which is so bad that you really have to find a remedy in this case I would as a matter of legal policy as a matter of legal policy I would want to be persuaded that the accountant had gone so far wrong that we really needed a separate way of approaching the matter and short of that and there are other ways of raising these things if if the accountant were at where in fact being unreasonable and disregarding the serious and genuine complaints a way would be fine of drawing that to the attention of the court I don't think barring examples of the accountant not operating properly I don't think it would be a sensible way to go but like everything else it's a matter of policy if you if you did it you could but you would find yourself with the disgruntled character who would never give up who would go to the accountant be dissatisfied go to the court appeal and so on and we've seen a number of examples of that in recent years okay yes nothing else to say on that it's uh don't go down that road is would be my instinct okay no thank you and certainly a final question from just in terms of you've said quite a number of things today with regards to the to the bill as it stands and also some differences between the bill and the slc report do you have any final comments or considerations on the views expressed by some by the stakeholders in relation to the bill in front of us no i think that we were we were finished with it we were functus our role had come to an end when we produced the report and the draft bill we have always accepted that the actual content of a draft bill was for the government because they are responsible for promoting the legislation and they will make changes for reasons which were not open to us to consider and they are perfectly well able to explain those reasons and defend them when they produce the bill to parliament it's then for parliament to decide and they have a separate view on the matter what they are prepared to pass as i said earlier bills are made to pass as razors are made to sell if the bill doesn't doesn't do the things that you want it to do or it does things you don't want it to do you have the ultimate voice in the matter the law commission is very far back than the food chain and we are satisfied with the the preparation work that we did and we're very grateful that the government has chosen to put the bill before parliament and we're grateful that parliament is taking the time to consider it and we earnestly hope that it will be passed in more or less its current shape because we think that will produce a better institution to serve the people of Scotland okay well thank you for that patrick colleagues do you have any further questions okay patrick and charles do you have any final comments you'd like to make i don't thank you committee don't okay so first of all thank you very much i can i thank both patrick and charles for their helpful evidence this morning the committee may follow up by letter with any additional questions that's standing for on the meeting and of course if you wish to add anything after the meeting you are most welcome to do so please do so in writing so with that thank you very much once again and with that i'll now suspend the meeting briefly to allow witnesses to leave the room thank you under agenda item number four we're considering instruments subject to the affirmative procedure no points have been raised on the draft sea fisheries remote electronic monitoring and regulation of scallop fishing scotland regulations 2024 and the draft transport partnerships transfer functions scotland order 2024 is the committee content with these instruments under agenda item number five we're considering an instrument subject to the negative procedure an issue has been raised on ssi 2024 101 the scottish local government elections amendment denmark regulations 2024 the instrument amends the local government scotland act 1973 to add denmark to the list of countries whose citizens are eligible to stand for elections as members of a local authority in scotland if they have leave or to enter or remain in the UK under section 282 of the interpretation and legislative reform scotland act 2010 instruments that subject to the negative procedure must be laid at least 28 days before they come into force not counting recess periods of more than four days the instrument breaches this requirement as it was laid on the 26 of march 2024 and comes into force on the 7 of may 2024 in correspondence with the presenting officer the scottish government explained that this breach had occurred as it could not lawfully make regulations to implement the treaty until after the UK parliament completed its scotland process which ended on the 25 of march the treaty is expected to come into force on the 7 of may at which point the provision in the instrument must be in place to comply with the UK's international obligations as the instrument has not been laid at least 28 counting days before they come into force as required by section 282 of the 2010 act does the committee wish to draw this instrument to the attention of the parliament under reporting ground to jay for failure to comply with lane requirements does the committee content with the scottish government's explanation provided for this breach of the lane requirements under agenda item number six we're considering instruments not subject to any parliamentary procedure no points are raised on SSIs 2024, 84 and 87 as a committee content with these instruments thank you and with that i'll move the committee into private