Property Factors (Scotland) Bill to ensure standards of practice

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

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

The Bill introduces:

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

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

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

Nicola McCafferty
Solicitor

8 thoughts on “Property Factors (Scotland) Bill to ensure standards of practice”

  1. I agree – this ‘factoring’ has been a joke and a ‘scam’ for too long and needs to be formalised, regulated and where ‘sharp practice’ can be proved – prosecuted.

  2. Thank you for your comment Mr Hewitt. I think that the regulation of factors will be a welcome piece of legislative change for most people who have to deal with a factor in Scotland. It is about time that they have to answer for the poor service that they provide to homeowners – and at a very high cost. I have no doubts that I am not the only one who is feeling short changed by a factor in Dundee, and in indeed in Scotland.

  3. I am a resident in Sheltered Accommodation. I own my flat and the complex is administered by a Management Company. The 2004 Act gave us the right to change our management but no one has come up with a way that we can accomplish this when the company owns the communal accommodation in the complex. Our service is not what it should be and the costs are increasing. We have little or no say in how the complex is run and a system of budgeting is non existant. The recent employment of on site staff, in which we had no input, has left us, in hours, 2 working days short every week and the cost of the said staff has increased. How can we do something about how this complex is run?

    1. May I direct you towards the Private Retirement Housing Code of Practice for Scotland. This was introduced on 26 October 2009 and is published by the Association of Retirement Housing Managers in partnership with the Scottish Government. You will find Chapter 16 particularly useful in relation to your matter.

      Here is the link to the web page that you will need:- http://www.scotland.gov.uk/Topics/Built-Environment/Housing/access/housingsupport/supportservices/ARHMPRHCOPforScot

      If this link does not work then you can access the Code of Practice from the Scottish Government website by entering “Private Retirement Housing Code of Practice” in the search tool.

      Kind regards

      Nicola McCafferty

  4. While I welcome any legislation that will help to tidy up this “licence to print money” type of industry, my problem is with the notion of factors in the first place. Why, just because I live in a certain type of accommodation (a tenement flat) am I forced to pay some third party to look after the fabric of the building and common areas? We have been told that we are perfectly free to sack our factors by majority vote but only on the condition that we either move to another factor or we manage it ourselves. The main problem here, is to find agreement with 8 residential tenants and 3 commercial tenants. We are currently “factored” by one of the biggest firms in Scotland and they are, quite frankly, hopeless. They carry out work without giving us prior notice, they cherry pick jobs according to complexity/profit gain and they choose contractors from the other side of the city, instead of using local tradesmen. I’d never lived in a flat in Scotland before moving here and the principle of having a factor did appeal initially. It makes sense for someone to look after the basic maintenance and repair of our building. But, after 12 years of hassle and grief, I want rid of them, yet due to some archaic law, which I’m sure has its’ origins in the old Clan system, I’m tied to these muppets. I’m now at the stage of seeking legal advice as they have carried out some “repairs” recently which are, quite simply, bodges. Furthermore, some 5 or 6 years ago, when there was a problem with the main sewage drain at the back of the property, they left us to wade through our own effluent for one and a half years, before the council served an order on the property and fixed it. The factors reason as to why they would not fix it? They insisted that we pay them upfront before they commence any work, the implication being that we would not pay for such an important repair. This is the thing that annoys me most, the principle behind the Scottish factoring system is patronising. The idea that we would let our property fall into disrepair, simply because we do not have a third party dealing with it, is risible. I pay my mortgage to a building society, my name is on the property deeds, I pay insurance on the property and yet, an anonymous third-party has the right to say when, what and how the fabric of my own property is maintained/repaired as necessary. I believe this is discriminatory (people living in houses do not need to be factored) and I also believe it to be an infringement on both my civil liberties and human rights.

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