A LEGAL claim of fraudulent breach of trust, being brought against the SNP because of how £600,000 raised to fight a second independence referendum was spent, is “close to irresistible” and could see the party ordered to repay double the donations given to them, according to the opinion of one of Scotland’s foremost lawyers.
Roddy Dunlop KC, the dean of the Faculty of Advocates, also said that “all elements of the crimes of embezzlement under Scots common law are made out” – assuming the alleged facts of the case are proven in court.
The leading KC’s comments come from a legal opinion drafted for Stuart Campbell, who writes the Wings Over Scotland blog and is leading a group civil claim against the SNP over funding raised from 2017-2019 which the party told donors was “ring-fenced” for a second referendum campaign.
Dunlop’s opinion cites First Minister John Swinney having this year “publicly confirmed that the ring-fenced referendum funds had been applied to ‘the ongoing activities of the Scottish National Party’”.
The KC adds: “As I see it (and I can think of no other reasonable interpretation), this constitutes an unequivocal admission that the trust funds were diverted from their stated purpose.”
Further, Police Scotland investigators have said that a separate bank account or funding pot never existed and the roughly £600,000 raised was kept in the SNP’s primary bank account with all other fundings.
The police probe into the SNP ultimately concluded without any charges of fraud being brought, with officials finding insufficient evidence to prosecute.
The investigation did uncover embezzlement by the party’s former chief executive Peter Murrell, who last month was jailed for five years and three months for his crimes.
However, a civil claim seeking to recover the funds would be subject to a lower standard of proof than a criminal prosecution: the balance of probabilities rather than beyond reasonable doubt.
Dunlop’s opinion states that exactly “who [emphasis in original] within the SNP authorized the disbursement of the relevant funds” would be crucial to a criminal prosecution “as only individuals can be dishonest”. However, “that is immaterial for the purposes of a civil claim,” he adds.
Referring to the draft summons published by Campbell earlier this week, the KC concludes: “Assuming the facts averred in the summons are proved, all elements of the crime of embezzlement under Scots common law are made out: position of trust, appropriation of trust funds to an unauthorised purpose, and dishonesty.”
He goes on: “The civil claim for fraudulent breach of trust is close to irresistible: the donations created a trust; the trust was deliberately and dishonestly breached; the donors retain a radical beneficial interest in the diverted funds and are entitled to repayment together with damages for the fraudulent breach.”
Dunlop then says that he believes “additional claims are potentially available to the donors”.
Citing case law, Dunlop suggests that the SNP may be liable for “damages for distress or inconvenience”, and to pay compound interest on the donations.
The KC writes: “Compound interest at 8% on payments made in March 2017 would mean a total interest rate of almost 100%: i.e. for a payment of £1000 paid then, £2000 would now be repayable.”
“For these reasons, in my view the donors have claims for: (a) Repayment of the donations which have been spent elsewhere; (b) Interest thereon at the judicial rate (8%), compounded at annual rests; and (c) Solatium for distress and inconvenience,” Dunlop’s opinion concludes.
Joanna Cherry, a former SNP MP who is also a KC, said the opinion was "emphatic".
"It seems likely that it will be left to the civil courts to right this wrong," she added.
An SNP spokesperson said: “These were the issues which were fully explored during the course of the forensic police investigation – and which resulted in no action taken against the SNP.
“In the course of this complex and extensive police investigation, the criminal actions of Peter Murrell were uncovered and the SNP was found to be the victim of embezzlement.
“A small number of donors to this independence campaign requested refunds and all those making a legitimate request received a full refund. Anyone else who donated and wishes their money back can request a refund by contacting the SNP.”
