The Sheriff Appeal Court has determined that the Scottish Legal Aid Board (SLAB) is under no obligation to pay statutory interest in circumstances where a legal aid account is overdue. 
Ormistons Law Practice Ltd raised an action against SLAB seeking a declarator that it was liable to pay statutory interest relating to a case that remained unpaid within 30 days of the account being submitted. 
In January 2020 the sheriff granted decree of declarator that the appellant had an obligation to pay statutory interest. The sheriff determined that the relationship between a solicitor and the Board could be described as commercial. The sheriff relied on the Late Payment of Commercial Debts (Interest) Act 1998, read with EU Directive 2011/7. The Board argued that the arrangements for payments to solicitors by the Board in respect of legal advice and assistance did not fall within the scope of the directive. The Board submitted that the transaction between a solicitor and client was a consumer contract and as a result payments by the Board were not remuneration for a commercial transaction. 
Delivering the opinion of the court, Sheriff Principal Stephen stated “The relationship between the solicitor and the Board is not therefore of the nature of a commercial transaction or contract envisaged by the Directive. The Directive is concerned with commercial transactions involving obligations on both sides. The obligations incumbent upon both the solicitor and the Board in LAA do not relate directly to the provision of services but rather their funding and are more akin to indemnity.” 
She continued: “The fundamental difficulty for the respondent lies not in substituting commercial transaction for contract but in interpreting the 1998 Act in a matter which encompasses the LAA scheme which is a statutory scheme. To read into sections 1 and 2 a statutory scheme for the provision of legal aid would be to alter the fundamental wording and purpose of the legislation. ‘It goes against the grain’ of the 1998 Act to interpret the legislation in the manner contended for by the respondent.”
As a result, the appeal was granted and a decree of absolvitor pronounced in favour of the appellant.