This section applies where, by virtue of section 35 or 49 of this Act, a function which was, before the commencement of this Act, exercisable by a district council (whether or not concurrently with another local authority) is exercisable by a local roads authority.

An officer of a district council who, in the period immediately before the coming into force of this Act, was wholly or mainly employed in duties pertaining, irrespective of how his office or employment was formally described, to a function referred to in subsection (1) above, shall be transferred into the employment of the local roads authority ; but such transfer shall not affect any legal right or entitlement of the officer.

Subject to any such agreement as is provided for in subsection (4) below, any heritable or moveable property of a district council which is wholly or mainly used, or held, by the council in relation to the discharge of a function referred to in subsection (1) above shall transfer to and vest in the local roads authority.

If or in so far as the district council and the local roads authority agree that property shall not be transferred by subsection (3) above, that subsection shall have no effect as regards the property; but the property shall no longer be used or held by the district council in relation to the discharge of a function referred to in subsection (1) above.

Any dispute between a district council and a local roads authority as to whether or when a transfer falls to take place under subsection (2) or (3) above or as to any other matter concerning such a transfer shall be determined by arbitration by a single arbiter appointed in default of agreement by the Court of Session, or the sheriff, on the application of either party.