A CAIRNEYHILL campaigner isn’t using a ‘Ponzi scheme’ to pay for his legal action about whether Holyrood can unilaterally call an independence referendum, a court has heard.

Advocate Aidan O’Neill QC told judge Lord Malcolm today (Friday) that Martin Keatings, who is a member of the Forward As One group, isn’t using unlawful methods to fund the case at the Court of Session in Edinburgh.

More than £258,000 was raised through crowdfunding and his lawyer had to explain how it works after a judge expressed concern that his financial backers could lose out.

Last month, Lady Carmichael ruled against Mr Keatings’s attempts to secure a legal order stating that the Scottish Government doesn’t need the permission of its UK counterpart to hold another independence referendum.

This prompted his legal team to go to the Inner House of the Court of Session and today, Mr O’Neill asked Lord Malcolm for permission to launch an urgent appeal.

He also asked the judge to pass a protective expenses order which would limit the legal costs that Mr Keatings would have to pay if he were to lose.

A previous request was denied by Lady Poole who said she had concerns about how financial backers of Mr Keatings would be paid back in the event of their cash not being used to meet legal costs.

Mr O’Neill said Lady Poole failed to understand the nature of crowdfunding.

He said: “She seemed to think that there was an indirect financial interest; she seemed to think that any monies raised by the crowdfunding which were not used for expenses would be kept by the individual pursuer for his own means – as if it was some kind of Ponzi scheme or some way of getting money.

“That’s not how it works. It was explained to the Lord Ordinary – although she chose not to accept that explanation, goodness knows why but she didn’t receive any counter explanation on it.

“But the fact is that monies raised by crowdfunding – in so far as they are not used for the purposes for which it has been raised, are not handed over to the person who has raised them – they are handed over to alternative access to justice charities.

“And in the case of larger donations, there is provision for return of unused funds as well.

“So there is no direct or indirect financial interest which one gets from crowdfunding.”

He also said: “It is entirely clear here that the pursuer himself is not wealthy in any sense. There is a statement of his means that have been ordered and therefore a protective expenses order is being sought in this case.

“Without it, there is a substantial barrier to justice being imposed.”

The Forward As One group obtained a legal opinion in December 2019 from Mr O’Neill who concluded that it would be lawful for the Scottish Parliament to call for an independence referendum without the UK government’s position.

This prompted Mr Keatings to launch a fundraising initiative on the Crowd Justice website and resulted in him raising more than £250,000 to pay for legal fees.

However, many constitutional law experts believe that Holyrood can only hold an independence referendum if it obtains permission from Westminster. They say the legal mechanism for this lies in section 30 of a piece of legislation called the Scotland Act 1998.

The action proceeded to court after Prime Minister Boris Johnson refused to grant the order.

Mr Keatings is standing as an independent candidate for Mid-Scotland and Fife in the Scottish Parliament elections in May.

On Friday, Mr O’Neil told Lord Malcolm that the Inner House of the Court of Session had to deal with the matter urgently because of the current political situation.

He added: “It is clearly not just an election issue but an issue of dispute between the UK and Scottish Government being seen as central to the basis of which voters are being asked to cast their votes.”

The court also heard that Mr Keatings may have to abandon his action if a protective expenses order wasn’t granted.

But Andrew Webster QC, acting for the UK government’s Scots law officer, the Advocate General, argued: “If you are looking objectively at whether or not the pursuer is likely to abandon these proceedings in the absence of a protective expenses order then what we know is that there is a significant diaspora of individuals willing to support him.

“He sees himself as a leader of those individuals. He has expressed a clear intention to proceed further. His backers may question what the pursuer has said to the court with the prospects of not proceeding if a protective expenses order is not granted.”

James Mure QC, for the Lord Advocate, said that the Scottish Government believed that the protective expenses order shouldn’t be granted.

Lord Malcolm granted permission for Mr Keatings' case to be heard urgently. It will call on April 6.

He will decide later on whether to grant a protective expenses order.