COMMITTEE. (Hansard, 15 May 1867)

§ MR. SELWYN
said, that this Bill, which had come down from the other House, had at first caused some consternation among the auctioneers and solicitors. The noble and learned Lord by whom the Bill was introduced (Lord St. Leonards) endeavoured to meet their objections, and had so far succeeded that the auctioneers were now convinced that the Bill as amended would prove a very useful measure, and, instead of petitioning against it, resolved to petition in its favour. They had done him the honour of sending him their petition, which he had presented to the House. It was not very encouraging, however, to find that persons who had accepted a compromise were to be put to as much trouble as if they had refused to make any concession. The Bill proposed to accomplish two things—one being to remove the conflict which unfortunately existed between the decisions of the Courts of Law and Equity with respect to this subject. The other object of the Bill was to get rid of the practice in the Court of Chancery of opening the biddings. With respect to the first object, it was clear that in such a matter as the sale of land by auction the Courts of Law and Equity ought to act upon the same principles. Lord Cranworth, who was Lord Chancellor in the Government of which the hon. Member for Sandwich (Mr. Knatchbull-Hugessen) was a Member, had stated that there was no doubt whatever as to 601 the rule of law which made a sale illegal where a puffer was employed; but the rule in the Courts of Equity was different, and authorized a person to bid for the seller so as to prevent the land set up for sale from going under a certain price. He (Lord Cranworth) agreed with what had been said by Lord Justice Knight Bruce that abstractedly the legal doctrine is the sounder. The inconvenience of the present state of the authorities could not be better illustrated than by the fact that, whereas the Master of the Rolls approved the principles established in the Courts of Law, he felt himself compelled to follow the practice of the Court of Chancery; while Lord Cranworth, approving the same principles, felt himself at liberty to act upon them. To the second part of the Bill—that of putting an end to the practice of opening the biddings—he believed that no objection would be raised; and it was certainly a practice which no reasonable owner of land would adopt in a sale of his own property.

§ MR. KNATCHBULL-HUGESSEN
said, that he felt he being no lawyer ought to apologize to the House for presuming to criticize a measure the author of which was an ex-Lord Chancellor, and which was introduced to that House by so eminent a legal authority as his hon. and learned Friend. However, he had sometimes found, in his Parliamentary experience of men and things, that when eminent lawyers condescended to deal with the common matters of everyday life, those matters became surrounded with a darkness and mystery which required to be dispelled by the touch of ordinary mortals; and so with regard to this Bill, which had come down from the other House incumbered with so many complicated provisions, that its object if not its effect was enveloped in obscurity. It had contained, however, so many provisions which in his opinion unfairly restricted trade, that he felt bound to give notice of an opposition to the Bill. His hon. and learned Friend had stated that the measure had been well considered in the House of Lords; but nevertheless, as soon as that notice of opposition had been given, the authors of the measure had found it necessary at once to strike out six clauses out of the fifteen of which the Bill originally consisted. By so doing his hon. and learned Friend stated that he had satisfied the auctioneers; but he (Mr. Knatchbull-Hugessen) begged to say that he represented—not 602 the auctioneer and not any organized opposition, but what he conceived to be the interests of the public. The Bill had two objects—one, to reconcile the conflicting decisions in the Courts of Law and Equity, the other to prevent the re-opening of sales by order of the Court of Chancery. With the latter object he entirely agreed, and his opposition was confined to the first clauses of the Bill. His hon. and learned Friend and he ever agreed upon the point that the decisions of the Courts of Law and equity should not conflict, but they differed as to the nanner in which those decisions should be reconciled. His hon. and learned Friend proposed three things in this Bill. First, that whatever a sale of land by auction was invalid at law it should be invalid in equity; second, that the seller should be bound to declare in the conditions of sale, whether the land was to be sold with or without a reserved price, and, if without reserve, then no puffer should be employed; and thirdly, that the seller should be obliged to hand in, before the sale, a written statement of the price below which he would not sell the property. He (Mr. Knatchbull-Hugessen) proposed, on the contrary, simply to enact that when the seller declared that his property would be sold without reserve, no puffer should be employed, but that when a reserve price was declared, there should be no restriction upon the bidding at the auction. What he contended was that any man who had land to sell had a right to obtain the opinion of the public upon the value of his property, and that he ought not to be subject to restrictions in so doing. The good old rule in matters of sale was caveat emptor—"let the buyer keep his eyes open" — and it seemed to him a reasonable idea. The buyer had every inducement and some facility to depreciate the value of the land for sale. But what was the case of the seller? He was one man against the world, and this Bill proposed to aid the world against the individual. This was no trivial matter—there was put up to auction in London alone annually real property to the amount of £10,000,000 in value, of which about half was at present sold at the auction, and about half the remainder disposed of by private sale afterwards. It was therefore necessary that the law should be clear and simple. It was objected to his proposal that the employment of a puffer was a fraud on the public. No more so than a combination of buyers was a fraud upon 603 the seller, and this frequently occurred. What was more common than for a man to say to his neighbour, "I will not bid against you for lot A if you will not oppose me in lot B," and so the seller was a helpless sufferer. The noble Author of the Bill had said "elsewhere" that a man was tempted to bid more than the property was worth by the vanity of showing that he had the longest purse — that vanity would be equally acted upon by bonâ fide or other biddings; but was it for this kind of person they were to legislate? A man who went into an auction-room to buy land was somewhat of a fool if he had not made up his mind as to what the land was worth to him, and if he bid more it was his own fault. Why should he expect to give less? Besides, look at the relative risk—if the puffer ran up the price, the buyer's risk was giving more than he thought the land was worth (if he were fool enough to do so), or losing the purchase be wanted. But if the seller employed puffers, his risk was that he might lose the sale altogether, and have incurred to no purpose all the expenses contingent upon an auction sale. He (Mr. Knatchbull-Hugessen) maintained that such matters righted themselves, and that all restrictions upon trade were foolish and unnecessary. His hon. Friend had talked of satisfying the auctioneer; but he begged to say that from representations made to him the case of the auctioneer was this—that they were anxious to get the latter part of the Bill passed, and to obtain this, consented to the first clauses, thinking them useless but harmless. But it was not the business of the House of Commons to cumber the statute book with provisions merely because they might do no harm. Their duty was to make a Bill as good as they could; and in this view, though he would not oppose the Speaker leaving the Chair, he should move his Amendments in Committee.

MR. KARSLAKE
said, that the 7th clause, which forbade the re-opening of biddings in the Courts of Equity, contained a very important rule, to which he saw no objection; but he was opposed to the 5th clause, because he objected to legislation where legislation could be avoided, and that clause appeared to involve a needless interference with every day business. Besides, there was no reason why they should legislate about land and leave chattels untouched. Without intending any reflection upon auctioneers of furniture and other chattels, they all knew that those who were 604 engaged in conducting auctions in land were, generally speaking, of a higher position in their profession; and therefore if it were necessary to tie the hands of those who sold land, it was still more necessary to tie the hands of those who sold furniture. There was scarcely a gentleman who had not suffered, or who did not know a friend who had suffered, by the manner in which horses were sold. A dozen horses were, perhaps, put up for sale for the purpose of getting rid of one or two. He recollected an instance of a Conservative Prime Minister, equally a good judge of horses and men, who lost a favourite mare at Tattersall's, because he sent her there among others which he wished to get rid of. By some means or other the wrong animal was sold to a barrister, who would not give the mare back again. To Clause 6 he objected, because it was not legislation at all, and if it were it would be objectionable. The object of legislation was not to tell people what they were to do, but the consequences which would follow if they did what they ought not. That clause said that in the case specified the amount below which the seller did not intend to sell the land should be stated in writing; but it said nothing of the consequences which were to follow if it were not done. If the principle of the Bill were adopted it ought to apply to all sales by auction, no matter what the nature of the property might be.