HC Deb 31 July 1889 vol 338 cc1806-15

Order read, for resuming Adjourned Debate on Question [8th July], "That the Bill be now considered."

Question put, and agreed to.

Bill considered.

Clause 1.

* MR. WALLACE (Edinburgh, E.)

My object in proposing the Amendment which stands in my name is to elicit some discussion on the point whether it is advisable that the two offices of Accountant of Court of Session and Accountant in Bankruptcy should be united. I do not intend to express my own reasons for these objections. I prefer to give the reasons which have been suggested by several Public Bodies in Edinburgh, and I trust that the Government will give some reply to those reasons. There are four Bodies which have objected to this union of the two offices. There is the Trade Protection Society, an Association of 1,300 or 1,400 merchants. There is the Edinburgh Chamber of Commerce, a Body of high standing. There is the Incorporated Society of Accountants, and finally there is the Council of the Solicitors of the Supreme Court, who are also an important and influential body. Now, the reasons they have put forward seem to me to be strong in themselves. I do not understand them to disapprove of the proposal to extend the supervision of the Accountant of the Court of Session over judicial factors. They agree that that is a great improvement, although they hold it will increase very considerably the labours of that official. There are already 1,300 factories under this officer, and the effect of the alteration will be to place 1,500 more under his control, thus more than doubling his work. But the proposal of the Bill does not stop there. It is intended to assign the duties at present discharged by the Accountant of the Court of Bankruptcy to this new department, and the legal and commercial bodies to which I have already referred seem to doubt the wisdom of that. They hold that from the nature of the duties the two offices should be distinct; and they suggest that whereas the duties in connection with one are purely those of an accountant, the holder of the Accountancy in Bankruptcy requires legal knowledge, in order to enable him to check fraudulent bankruptcies. I do not suppose there is any necessarily inevitable incompatibility between law and accounts, but still there is some force in the objection taken by the societies with regard to the diversity of mental habitude that is produced by these separate functions. That, however, is not all. The Accountant in Bankruptcy already has enough work on hand for one official. He has to deal with 500 sequestrations and 340 cessios per annum. At the present moment there are 1,300 sequestrations, more or less in hand; and besides this, he has to examine 500 sederunt-books, 450 inventories, and 3,000 accounts every year. Now, the bodies whose opinions I am advocating hold that there is a necessity for the extension of the Accountant's supervision over proceedings in bankruptcy—reporting suspicious cases, taking note of the liquidation of companies, and all private arrangements between debtor and creditor, and tabulating statistics on such matters—so as to give the commercial public a complete précis annually of the insolvency in the country. The work in both Departments has been doubled within the last 25 years, and the probability is, of course, that it will continue to increase. Accordingly, the bodies objecting to these proposals think that there may be some danger of the Bankruptcy Department in particular suffering from this merging of one office into another. They hold that in bankruptcy especially there should be speed and personal supervision by the head of the Department in the interests of creditors, and they fear that the union of two offices will lead to there being delay or less personal supervision by the Accountant in Bankruptcy. They, therefore, contend that any economy that may arise from amalgamating the offices—and I presume that economy is the object in view—such economy will be dearly purchased by the injury that will arise, mainly in the Bankruptcy Department. I shall be very glad to have a satisfactory explanation from a Member of the Government on these points, and I therefore move to omit Clause 1, in order to elicit some reply to the objections which have been raised.

Amendment proposed, in page 1, line 15, to leave out Clause 1.

Question proposed, "That Clause 1 stand part of the Bill."

THE LORD ADVOCATE (Mr. J. P. B. ROBERTSON,) Bute

The questions raised by the hon. Gentleman are certainly of some importance, but at the same time I may say that the opinion of commercial and professional men has been moving steadily during the last five years in the direction of this change. I can assure the hon. Member that an efficient staff will he maintained, and there will be no want of skilled attention to the work of bankruptcy. When the head of the new Department has to be appointed it is inevitable that an expert actuary will be selected, and some one will be chosen who has had personal and professional experience of windings up in bankruptcy. It is true that the Bankruptcy Department work requires special knowledge and experience, but I venture to think that the fusion of the two offices and the consequent increase in the volume of work will increase rather than diminish the celerity as well as the efficiency of administration.

MR. CALDWELL (, St. Rollox) Glasgow

I have received communications from professional gentlemen and others in the City of Glasgow protesting against the change proposed to be introduced by the Bill. There can be no doubt that Bankruptcy administration requires special knowledge. In order to get a thorough grasp of all the technical details one has to devote almost his whole time to the study. No doubt very pregnant reasons can be given for the change. I do not think it has been brought about by considerations as to the expediency of uniting the two offices, and I believe that really the Treasury is responsible for the Bill, the object aimed at being a reduction of the salary. It is evidently held that the new officer will not be able to do all the work himself, because provision is made in the Bill for the delegation of certain duties. However, at this stage we can do no more than point out the injudiciousness of the Government proposal; we can only point out that the course to be adopted is opposed to the views of the commercial community, and that the responsibility for the failure which may result will rest solely with the Government.

Amendment, by leave, withdrawn.

MR. CALDWELL

At the present moment there are two separate offices—the Accountant of the Court of Session and the Accountant in Bankruptcy, and power is taken in this clause by the Treasury to grant pensions to the holders of these offices. Now the object of the Amendment which stands in my name is that the pension shall only be granted in respect of the salary and emoluments received prior to the passing of this Act. When the Criminal Law Procedure (Scotland) Act was passed, it raised the salary of the Judges, who, immediately after they became entitled to the higher sum, resigned, and were awarded pensions on the basis of the increased salary. Now, I want simply to provide that the present holders of these offices shall not, six months after the passing of this Bill, resign their posts and get pensions on a higher scale than they are now entitled to. I am aware that on this subject the responsibility rests with the Treasury, but I have felt it my duty to point out this objection.

Amendment proposed, in page 2, line 11, after the word "Act," to insert the words— But only in respect of the salary and emoluments of such offices respectively as the same existed prior to the passing of this Act."—(Mr. Caldwell.)

MR. J. P. B. ROBERTSON

The hon. Member is quite right. This is a Treasury matter, but it is obvious it would be unjust, supposing that these persons remained in office under the present Act, that they should be limited to pensions on the scale of the remuneration they were now receiving. In some cases their duties might largely increase, and I certainly cannot see any reason for the restriction which is proposed by the hon. Member.

Question, "That those words be there inserted" put, and negatived.

On Clause 4,

* MR. WALLACE

The fourth clause gives compensation to the holder of the Office of Accountant of the Court of Session on the abolition of that office. It seems to me rather strange that while this compensation is proposed to be given the provision is not extended to the holder of the office of Accountant in Bankruptcy. If it is right that one should receive compensation, surely the other is equally entitled to it. But I understand that arrangements have been made with respect to the present holder of the office of Accountant in Bankruptcy so that there is no necessity for compensating him, and if that is so, I will not press the Amendment which stands in my name.

MR. J. P. B. ROBERTSON

The office is at present vacant, and the duties are being performed under a temporary arrangement.

* MR. WALLACE

Under those circumstances, I will not move that particular Amendment, but I will pass on to the next one which stands in my name, and which directs that in fixing the amount of the pension regard shall be had to the extent of private practice pursued by the holder of the office, as well as to the length of his service. Of course, I know that this question of the extent of private practice would be one of the "circumstances of the case." But I should like to have this point emphasised by being explicitly inserted in the Bill. I think it would be satisfactory that this should be done. I believe the Act requires that the Accountant of the Court of Session shall not engage in private practice, but, for anything we may know, it may happen that he has had a private practice, it being the duty of no one in particular to take notice of the fact. It is not in the nature of a crime, it is rather an irregularity, but from information which circulates in connection with this matter, I think it would be useful that these words should be inserted. If there has been no irregularity, then no harm will be done to anyone, but if there has been irregularity, then the Treasury ought to be required to take cognisance of the fact in settling the amount of pension to be given. I believe if the Lord Advocate accepts the Amendment he will give a great deal of satisfaction, and allay a certain amount of suspicion and difficulty that exists in connection with this matter.

Amendment proposed, Clause 4, page 2, line 26, after the word "service," to insert the words "extent of private practice."

Question proposed, "That those words be there inserted."—(Mr. Wallace.)

MR. J. P. B. ROBERTSON

I do not doubt that it is open to the Treasury in determining the amount of allowance to take into consideration all the circumstances to which the hon. Gentleman has alluded, but I do deprecate the insertion of the words he suggests, because they would, I think, give official recognition or sanction to a principle which ought not hastily to be laid down. I think this is a matter which must be left with the Treasury.

Question put, and negatived.

MR. CALDWELL

My next Amendment has reference to the audit of accounts of judicial factors. According to the existing practice all accounts in cases where a judicial factor has been appointed have to be audited by the Accountant of the Court of Session, and the object of my Amendment is that in Provincial districts the audit may be made by auditors in those districts. Of course the Lord Advocate will naturally object to my Amendment, but I may inform him that I am proposing it at the instance of a legal body in Glasgow, who consider its adoption necessary for the purpose of protecting their interests. Personally I have no interest in the matter.

Amendment proposed, in page 5, line 10, at end of Clause 12, to insert the words:— And except for business in the Court of Session any account for law business incurred by any factor or other person subject to this Act shall be deemed sufficiently audited if audited by the auditor of any Sheriff Court, or by the auditor appointed by the faculty of procurators in Glasgow."—(Mr. Caldwell.)

Question proposed, "That those words be there inserted."

MR. J. P. B. ROBERTSON

This point was considered by the Grand Committee, who rejected the Amendment. I must deprecate the insertion of specified persons or bodies in a General Act of Parliament. I have the highest respect for the Faculty of Procurators of Glasgow; I am certain they perform most valuable duties, but I do not think their name should be inserted in an Act of Parliament under the pretext of enabling the accountant to accept the reports of Provincial auditors.

Question put, and negatived.

MR. CALDWELL

I have still another Amendment to propose, and the reception of it by the Government will, no doubt, illustrate how determined they are to reject the most ordinary and reasonable proposals. Under the existing law in bankruptcy cases there is no fee charged for the audit of accounts, but by this Bill it is proposed that while the accountant is bound to audit the accounts of the judicial factors free of charge, the audit of bankruptcy accounts is to be charged for. Now the judicial factors are usually well-to-do men, yet you are going to do this work—for which they can well afford to pay—at the expense of the country. On the other hand the audit of bankruptcy accounts is to be charged for, and people who are not getting the 20s. in the £1 are to be mulct in charges for the audit. I maintain that that is not reasonable, and I therefore move my Amendment, although I know very well what the result will be.

Amendment proposed, in page 5, line 35, to leave out from the word "and," to the end of the line.—(Mr. Caldwell.)

Question proposed, "That the word 'section' stand part of the Bill."

MR. J. P. B. ROBERTSON

This question was also carefully considered by the Grand Committee, and I am rather surprised at the indignant tone of the hon. Gentleman seeing that there was no difference of opinion in the-Committee on the point.

Question put, and agreed to.

Another Amendment made.

Amendment proposed, in page 5, line 37, to leave out from the words "bankruptcy cases."—(Mr. Caldwell.)

Question, "That the words proposed to be left out stand part of the Bill," put, and agreed to.

Other Amendments made.

Amendment proposed, in page 7, at end of Clause 17, to insert the words And Section 141 of 'The Bankruptcy (Scotland) Act, 1856,' is hereby repealed, so far as said section provides for the review of the lord ordinary and sheriff in the matter of the trustees' remuneration."—(Mr. Caldwell.)

Question, "That those words be there inserted," put, and negatived.

Another Amendment made.

MR. J. P. B. ROBERTSON

May I ask the House now to read the Bill a third time? The Amendments that have been made are simply in matters of detail, and they in no way affect the general principle. I think there is a general concurrence of opinion in favour of taking the last stage.

Question proposed, "That the Bill be read a third time."

MR. CALDWELL

In passing the Local Government Bill the House came to the conclusion that there should be no compensation or pension except to those who, by the terms of their engagement, are entitled to such compensation on the abolition of their office, but I think it is pretty well understood that one object of this Bill is to create a claim for compensation for the holder of a certain office. The matter has been brought out in this way: the office he holds is to be conjoined with another office, and after that the holder of the conjoined offices is to get a pension in respect to the two offices. Now, an Amendment was moved here to the effect that if compensation was to be given it was not to extend further than to the existing office the person might hold and according to the emoluments of that office. But the Government have hinted that the present holder might continue his appointment for a year or two and then get his pension. He is advanced in years and may only hold office for six or 12 months and then retire on the pension applicable to the larger salary. Now, this is a matter that I should not be justified in allowing to pass without protest, and I do protest on the principle we laid down in the Local Government Bill where we refused to grant a pension or even compensation on the abolition of office, unless the person is otherwise entitled to this compensation or pension. This Bill goes further and creates a right to a pension by the holder of an office. Ostensibly the Bill provides for the amalgamation of two offices, but the simple effect of the Bill is to give to the holder of an office a pension to which he is not now entitled. The present holder of the office will continue in office for six months or 12 months, and then he will retire on the pension applicable to the larger salary of the combined offices.

MR. DONALD CRAWFORD (Lanark, N.E.)

The hon. Member gives a somewhat startling statement of the provisions of the Bill; but my understanding of them is something very different. The hon. Member has before expressed his opinion that the effect, and even the object, of the Bill was to unite two offices, and then the holder of the office of Accountant of the Court will retire with a pension based upon the salary of the combined offices. That statement seems to have made some impression upon Members on this side. Now, if that were the effect of the Bill, no one would be more forward than I to condemn it; but I read the Bill in an entirely different sense. I understand there is a special clause that deals with the office of Accountant of the Court, an office which the present holder has held for many years with general acceptance, and as I read the Bill there is no provision in it for compensating him except in respect to the present office, and the double office will be filled by a new officer on the retirement of the present officer, which, I understand, is about to take place. There is, I understand, no foundation for the statement that the double office will be held by the present Accountant, and that he, in consequence, will be entitled to the double compensation. This is clear to me, but it might, be well if the Lord Advocate would remove any doubt there may be in the-mind of any hon. Member. I do not think it would be right or fair that we should have a special clause providing, for compensation to the holder except in respect to the office from which he is about to retire.

MR. J. P. B. ROBERTSON

I am most happy to reassure the hon. Member on this point, though I should hardly have thought it was necessary to do so. The present holder of the office of Accountant to the Court has served the public for a very long time; he is entitled to retire, and I understand desires to retire. His compensation will be on the scale of the performance of the duties of his single office without any relation to the new office. I am bound to say I did not think, and I scarcely think, how there can be any misconception on the point referred to by the hon. Member for Lanark, but if there is I hope what I have said will remove it.

MR. DONALD CRAWFORD

There was no misconception on my part.

Question put, and agreed to.

Bill read a third time, and passed.