Compatibility of Bankruptcy Act with ECHR
A case was brought by the trustee in the sequestration of John Walker, against the debtor’s former wife challenging a gratuitous alienation. The issue brought by the defender concerned whether section 34(4) of the Bankruptcy (Scotland) Act 1985 was incompatible with the European Convention on Human Rights. While recognising that the transfer constituted a gratuitous alienation, and rejecting the defences set out in section 34(4), the defender alleged that as section 34(4) of the Act has no regard to the personal or financial circumstances of the defender or to the reasonableness or proportionality of the order sought the section is incompatible with her rights under Articles 6, 8, 14 and Article 1 of the First Protocol of the European Convention on Human Rights. The court found the defender’s positive defence to the action irrelevant and granted decree de plano. Articles 6, 8 and 14 were found not to be engaged in the present case and as such the discussion focused on Article 1 of the First Protocol. It was recognised that the sum in question fell within Article 1 of the First Protocol as a relevant possession and that the grant of the decree would constitute an interference with the defender’s right. However, the court found that section 34(4) reflected a legitimate aim that struck an appropriate balance between the competing interests of the defender on the one hand, and the public interest on the other. As such the grant of a decree would not breach the defender’s rights under Article 1 of the First Protocol. The court found that section 34(4) of the Act is compatible with the European Convention on Human Rights.