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The assessment would be based on the applicant, and not on the missing person. The applicant would be able to get legal aid for advice and guidance from the solicitor initially, to work out whether they should go for a judicial factor or not and whether doing so would be relevant for them. If a person is on benefits, they would have their court fees paid by legal aid, and the applicant is the person who would be assessed.

The process for appointment is such that the accountant is not involved at the initial stages of an application. At that stage, it is a matter for the court alone. It would be open to the court to make inquiries that it considers appropriate to assist in deciding whether the person seeking appointment is suitable, and that might include whether they are currently bankrupt.

The accountant acts as a supervisor to factory estates, and such checks might be helpful in making sure that the function is carried out appropriately. It seems that the accountant already carries those checks out, so I do not think that anything further is needed.

Yes, my officials have.

Yes, of course. Thank you for the question, Mr Mundell. There has been some confusion about what the Trusts and Succession (Scotland) Act 2024 allows in this area. To clarify, if there is no contrary intention in the trust deed, the 2024 act allows trustees properly to take non-financial considerations into account when choosing between investments for the trust. However, that is only in situations where the environmentally friendly investment, for example, has the best financial prospects or has financial prospects that are equally as good as those of another investment. In other words, trustees are not always bound to maximise financial returns where a suitable investment would be consistent with the purposes of the trust or where they have taken proper advice. Rather, the investment policy that trustees adopt should reflect the purposes of the trust.

The questions put to stakeholders by the committee included whether judicial factors should have a power to invest in lower-performing investments if they meet specified ESG criteria. That is different from the provision in the 2024 act, and I do not agree that there is a need expressly to confer such a power on a judicial factor. Not all judicial factors will need to make investment decisions, and the bill requires judicial factors to consider whether it would be appropriate to invest. That is not likely to be the case for all judicial factories.

The bill is not prescriptive as to how to invest, and it leaves it up to the judicial factor to decide on that, taking professional advice where appropriate. I am willing to look into the matter further, however, and I have asked my officials to write to stakeholders in the coming months, asking them for their views on whether an express power similar to those available to trustees would be welcome. I am happy to write to the committee ahead of the next stage with my thoughts on that.

I consider that an additional power that would allow judicial factors to seek directions from the court is not necessary, given the nature of the office and the fact that there are other options available.

Judicial factors accept offers on the understanding that they are there to use their judgment, take professional advice where appropriate and make decisions in relation to the estate. If they have any doubts as to whether they have the necessary powers to take a particular course of action, they can apply to the court for additional powers under section 11 of the bill. That can be done at any time after the initial appointment.

While the court directions might be useful in respect of trust estates and executries, that is because there is no equivalent to the Accountant of Court, and the only option is to go to court. Judicial factors, on the other hand, are supervised by the Accountant of Court, and if they are unsure about what they should or can do, they should consult the Accountant of Court and agree on a way forward. As such, I do not think that we need to add another route for directions, in particular as that would add a significant cost to the factory estate, given that seeking directions from the court comes with court fees and legal expenses. Before the committee reaches any conclusion on the issue, however, I urge you to seek the views of the Lord President in that regard.

A judicial factor is a person who is appointed by the court, and I consider that there must be a formal process for bringing the office to an end. That would protect both the missing person who has returned and the judicial factor, who may be a family member. It is important that the formerly missing person can take over the management of their estate as quickly as possible, but it is also important that the actings of the judicial factor can be scrutinised and that they can be discharged of liability.

The bill provides an administrative process, overseen by the Accountant of Court, for the termination of the judicial factory. In most cases, that process would be used. Alternatively, the bill also provides persons “with an interest” with a route to

“apply to the court for distribution”

of the factory estate.

That point has been raised with regard to missing persons. At this moment, our answer is no, but we are happy to consider it.

Section 34 of the bill and the accompanying explanatory notes make it clear that the effect of the discharge is that

“the judicial factor is no longer ... accountable”

for what has taken place during the course of the judicial factory. As such, once the judicial factor is discharged, the Accountant of Court would not be able to investigate or report any misconduct under section 38. The SLC report is clear that, once the factor leaves office, that should

“end any obligation ... to account further to the estate or those representing it.”

To do otherwise would run the real risk of discouraging individuals from taking on the role, which was a point that the Accountant of Court made in her evidence to the committee last week.

Importantly, there are safeguards in place. Judicial factors are supervised by the Accountant of Court and are required to regularly submit accounts and report to her on the management of the estate. Before a judicial factor can be discharged, the accountant has to audit the final accounts and be satisfied that everything is in order.

Further, section 34 makes it absolutely clear that discharge has no effect on criminal liability. Both criminal liability and any civil liability that is connected to it continue after the discharge, which means that a judicial factor can still be held accountable, for example, if they have committed fraud in the course of the judicial factory.

I am happy to take that away, and we will definitely consider it.

Absolutely. We will take that away and consider it.