Commons Sitting of 29 June 1870

MINUTES.
PUBLIC BILLS—Ordered—First Reading—East India Contracts * [186]; Local Government Supplemental (No. 3) * [188].
First Reading—Parishioners' Rights * [187].
Second Reading—Sale of Liquors on Sunday [57], debate adjourned; Absconding Debtors * [172].
Committee—Report—Life Assurance Companies [2]; Lodgers' Goods Protection * [96–185].
Third Reading—Medical Officers Superannuation * [70], and passed.
Withdrawn—Coroners * [42].

LIFE ASSURANCE COMPANIES BILL. [BILL 2.]
(Mr. Stephen Cave, Sir Thomas Bazley, Mr. Russell Gurney.)
LIFE ASSURANCE COMPANIES BILL. [BILL 2.]

  COMMITTEE. [Progress 2nd March.]
  Bill considered in Committee.
  (In the Committee.)
  Clause 3 (Deposit).
  MR. SYNANsaid, he rose to move, as an Amendment, the omission of the latter part of the clause, which provided that the deposit of £20,000 which every assurance company to be formed in the future would have to place in the hands of the Court of Chancery on starting their undertaking, should be returned to the company when their premiums reached the amount of £40,000. It was absurd to say that the deposit would be any guarantee of security to the public or to the shareholders if it were to be returned to the company when they had realized £40,000 in premiums, for the amount of the premiums could be no test of the solvency of the company. That solvency must depend upon the fact as to whether the lives taken by the

  1171
  company were good or bad. If the lives were bad the amount of premiums received would be as much a test of insolvency as of solvency. If there were to be the guarantee of a deposit, it should be a continuing guarantee. If the clause were passed as it stood it would simply delude the public. He begged to move, in line 9, to leave out all after "made" to end of line 11.
  MR. STEPHEN CAVEsaid, the hon. Member mistook the clause. The deposit was simply intended to secure the bona fides of the company, and to prevent bubble companies being formed merely to be sold, a practice which was productive of much mischief. The retention would be no security. The Albert would have paid as much at any moment.
  MR. BARNETTsaid, he also objected to the Amendment, on the ground that the amount of the deposit was too small to be looked upon as a complete security to the public. A sum of £20,000 was a very small matter in the assets of an assurance office, and would never save a company from ruin.
  MR. H. B. SHERIDANsaid, this was one of the most important clauses of the Bill in all respects, for it raised the whole question of assurance management, and the success or failure of its past history. Before hon. Members decided on a policy so restrictive in its character, they ought to take especial care to ascertain whether they had been rightly informed as to the real position of these institutions and their real character. He did not intend to oppose the progress of the Bill. He thought the House was much indebted to the right hon. Gentleman (Mr. S. Cave) for having introduced it, and for the success with which he had dealt with a mass of details; but there were parts of the Bill which were objectionable. If the parts to which he objected could be modified, he would gladly give his aid to the right hon. Gentleman to carry the Bill through during the present Session. That portion of the measure which he most disliked related to the provisions for winding up—
  THE CHAIRMANsaid, he must point out that the question before the Committee was the omission of words which directed the Accountant General, under certain circumstances, to return a deposit, and hon. Members must confine themselves to that point.
  MR. H. B. SHERIDANsaid, he would submit that the question of the Amendment raised the whole question of life assurance.
  THE CHAIRMAN: Order. That does not raise the whole question.
  MR. SYNANsaid, he had never stated that the deposit would be regarded as a complete security to the public. What he maintained was that his Amendment would form an element of security which would be granted. As to the objection urged against the Amendment, that it would handicap the new companies and give an advantage to the old ones, there was no force in that, because it was to be hoped that the old companies were perfectly solvent. If the new companies were solvent there was no handicapping, while if the old companies were insolvent no amount of handicapping placed on the new ones would save them.
  MR. SHAW LEFEVREsaid, on behalf of the Government he must oppose the Amendment. Though it was true that the retention of the £20,000 in the hands of the Accountant General might be an element of security, yet it was so trifling an element of security, that it was not worth adopting. The motive of the clause was to prevent the formation of rotten companies, and for that purpose it was valuable.
  MR. MUNDELLAsaid, the company might replace the £20,000 by premiums, and then the deposit would be a false security and deceive the public.
  Amendment negatived.
  Clause, as amended, ordered to stand part of the Bill.
  Clause 4 (Life funds separate).
  MR. M'LARENsaid, the clause made undue distinction between new and old companies. His right hon. Friend the Member for Glasgow University (Mr. Gordon) had given Notice of an Amendment to leave out the words "established after the passing of this Act," in order to place them in the same position; and he wished to ask the right hon. Gentleman who had charge of the Bill to give some explanation with reference to this point, because he had a strong impression that no new companies ought to be put in a disadvantageous position in comparison with the old companies? He wanted to know why the Amendment was not to be moved?
  MR. STEPHEN CAVEsaid, that the difference between the two cases was that in those which were already established all their contracts had been made, whereas, in new companies, all the contracts would have to be made. Others could be made subject to the provision in this clause. It was impossible to interfere with existing contracts; but they could make any provision they chose with respect to the new companies. He therefore moved at end to add—
  "Provided always, That this clause shall not apply to the case of any existing company in which, by the provisions of the deed of settlement, the whole of the profits of all the business transacted are paid exclusively to the life policy-holders."
  There was, he believed, only one such company, which was formed for the purpose of encouraging providence in sailors. It was encouraged for that purpose by the great steamship companies, and might almost be said to be in the nature of a charitable institution.
  Amendment agreed to.
  Clause, as amended, ordered to stand part of the Bill.
  Clause 5 (Statements to be made by companies).
  MR. T. CAVEsaid, he would beg to move to leave out "financial," in page 2, line 25, so as to require every company to make its returns at the end of "each year," and not at its own financial period.
  MR. STEPHEN CAVEsaid, he quite agreed that, so far as symmetry was concerned, it would be of advantage that the returns should be made at onetime; but the inconvenience to existing collectors would be so great that he could not advise the adoption of the Amendment.
  MR. BARNETTsaid, he thought the term "financial year" made the clause somewhat obscure.
  MR. SHAW LEFEVREexplained that the company's financial year was indicated.
  Amendment, by leave, withdrawn.
  MR. BARNETTsaid, he thought they might improve the clause by the introduction of the words "each financial year."
  SIR THOMAS BAZLEYmoved to leave out "at the expiration of each financial" and insert "once every year."
  Amendment agreed to.
  Clause, as amended, ordered to stand part of the Bill.
  Clause 6 agreed to.
  Clause 7 (Actuarial report and abstract).
  MR. ANDERSONsaid, he wished to move, as an Amendment, that the report and abstract of a company should be prepared once in every five years, if the company was established after the passing of the Act, and once in every 10 years, if established before. Such an Amendment was absolutely necessary, because by the deeds constituting many of the existing companies, the examination was to take place every seven years, and it would be highly inconvenient and expensive to them if they were now required to change their constitution, make up their accounts, and declare and divide their profits every five years. The right hon. Member for the University of Glasgow (Mr. Gordon) had an Amendment on the Paper in different words, but very much to the same effect. It was a matter of perfect indifference to him whether his Amendment or that of the right hon. Gentleman the Member for the Glasgow University were adopted.
  Amendment proposed,
  In page 2, line 36, after the word "years," to insert the words "if established after the passing of this Act, and once every ten years if established before the passing of this Act."—(Mr. Anderson.)
  MR. BARNETTsaid, he objected to the Amendment. Several existing offices made their report once in every five years. Should it be adopted, he admitted that there would be a difficulty in adjusting the clause to the case of some existing companies, but thought it might be done without destroying their constitution.
  MR. M'LARENsaid, the Amendment would not secure to the public the information it desired. Many years ago an Act for the regulation of banks was passed, containing a similar provision to that proposed by the Amendment; and on account of the distinction drawn between the old and the new banks, not a single new one was established in Scotland after the passing of the Act; the result being that the old ones acquired a complete monopoly. He thought that the public ought to have the benefit of free trade; and that all companies, whether new or old, ought to be dealt with in the same manner.
  MR. STEPHEN CAVEsupported the Amendment, as it would be highly in-

  1175
  convenient for the existing companies to be obliged to alter their constitutions with regard to the publication of accounts, and there was the additional difficulty that division of profits depended on these periodical valuations.
  MR. SHAW LEFEVREsaid, seeing the great trouble to companies the Amendment would obviate, the Committee would do well to adopt the proposal of the hon. Member (Mr. Anderson).
  MR. HEADLAMsaid, that the returns would involve much expense; and he, for one, could not see any very urgent necessity for their preparation.
  Question put, "That those words be there inserted."
  The Committee divided:—Ayes 81; Noes 16: Majority 65.
  MR. BOWRINGsaid, he would beg to move, in line 39, to leave out "an actuary," and insert "a professional actuary of not less than seven years' standing." He thought that some such alteration was necessary, as the Interterpretation Clause, which had already been passed by the Committee, contained no definition of an actuary. The only definition of an "actuary" that he could find in the Library amounted to this—that he was an actuary. One great object being to guard against bubble companies, it was important that the investigations should be conducted by persons of proper standing in the profession. He should have preferred, in some respects, to propose that the actuary employed to certify the accounts should be appointed by the Board of Trade, or at any rate be approved by them; but there were as strong objections to the Government undertaking this duty as he, from experience knew there to be to the present system, whereby the inspection of railways, prior to their opening, was intrusted to Government Inspectors. Responsibility would, by such an arrangement, be removed from the companies by the certificate of the certifying actuary, and be transferred to the Government. He might mention, in proposing this Amendment, that he had placed on the Paper an alternative Amendment, in line 39, after "actuary" to insert—
  "Who, unless he be at the time of the passing of this Act the actuary of an established company, shall be a member of the Institute of Actuaries of Great Britain and Ireland, or of the Faculty of Actuaries in Scotland."
  1176
  The hon. Member proceeded to show that although the Institute of Actuaries had not yet obtained its contemplated charter of incorporation, it had already attained such a position that the proposal contained in this Amendment might reasonably be adopted, whilst the Faculty of Actuaries in Scotland was a present a chartered body.
  MR. STEPHEN CAVEasked how you could define a "professional" actuary? The word would give no security, for anyone might constitute himself a professional actuary. Then, as to the seven years' standing, from what time was the date to run? Was it from employment by an office? Some of the best actuaries in London had only been so employed for two or three years. No doubt the Institute of Actuaries was a body to which actuarial science owed much, and which had contributed much to raise the status of actuaries; but many actuaries of considerable standing were not members of it, nor was any examination requisite for admission. He had hoped that the Institute would have entitled itself to a Parliamentary status by applying for a charter; but at present the House would hardly be warranted in giving a Parliamentary recognition to a voluntary body.
  MR. BARNETTsaid, that some time ago 50 companies were being wound up in the Court of Chancery, all whose actuaries were, he believed, members of the Institute.
  MR. ANDERSONsaid, the object of all the Amendments which were under discussion, for they all bore on the same point, was simply to get a better examination—an examination, in fact, which would not be a delusion and a snare; and he considered it very unfortunate that something more definite had not been adopted. With respect to Scotland, they had a Faculty of Actuaries possessing a Royal Charter, and if England were as well off as Scotland in this respect, he should have no hesitation in saying that the Amendment which stood in his name would have been the best for the purpose in view. Seeing, however, that the Institute of Actuaries of Great Britain and Ireland had not got a charter, he agreed with the right hon. Gentleman who had charge of the Bill that what was proposed could not be accepted.
  MR. SHAW LEFEVREsaid, the Amendment, if adopted, would by a side-

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  wind give a legal recognition to that which was merely a club.
  MR. C. TURNERsaid, that persons must look to the name and reputation of the independent actuary, and not merely to the fact that a person calling himself an actuary was employed.
  MR. GILPINsaid, he believed the House could do too much as well as too little on this subject. A professional actuary with a character would give a true account of figures submitted to him for examination. The best security for insurers was perpetual watchfulness, not what was intended to be done by Government when actuaries were appointed.
  MR. RUSSELL GURNEYsaid, the real security to the public consisted, not in what a man was likely to be, but in what he was likely to do; and he would point out that under the Bill the actuary was liable to a penalty of £50 if he made a false return.
  MR. MONKsaid, he would suggest that the word "actuary" should be omitted as being useless. It did not admit of definition.
  MR. H. B. SHERIDANsaid, he believed it was well known practically what actuaries were; they were a body of gentlemen who had a special mathematical education and whose attention had been especially directed to financial statistics. No imputation attached to actuaries because 50 companies had been wound up. If those companies ceased to exist, it was not owing to any actuarial shortcomings, but because the companies failed to secure a sufficient amount of business.
  MR. BOWRINGsaid, his object in moving the Amendment had been to raise a discussion on the subject, and that having taken place, he should not press the matter further, although he hoped the right hon. Gentleman in charge of the Bill would endeavour, at a future stage, to define what an actuary was.
  MR. M'LARENsaid, he thought that the clause should be left as it was. These precautions would only tend to lessen the responsibility of directors.
  Amendment, by leave, withdrawn.
  MR. W. SHAWsaid, he desired to add to Clause 7 a provision which would serve the interest of good companies, and would only be a terror to sham companies. At present the audit of the accounts was often of little use, because
  1178
  the same auditors were appointed from year to year, and he thought the Board of Trade, representing the public, should appoint the auditors, who, while examining the accounts, should also examine the value of the assets of the company. The recent collapse of insurance companies had caused great dread throughout the country, and people were so discouraged by the loss of their savings that many were deterred from insuring their lives. In his opinion, the Government ought to do something more in the interest of insurers than they did at present; but at least they should protect the public by an independent audit, and he therefore moved to add to the clause—
  "And on such investigation and report being completed, the company shall apply to the Board of Trade, who shall appoint an auditor or auditors; and such auditor shall be supplied with a copy of the report and schedule herein referred to; he shall have a list delivered to him of all books and accounts kept by the company, and shall have access to such books and accounts, and be at liberty to examine all officers and directors of the company; and the auditor shall report whether returns and schedules contain fully and fairly the particulars required by this Act, and all particulars necessary to exhibit a full and correct view of the state of the company's affairs; he shall also report on the nature and value of the assets of the company."
  MR. STEPHEN CAVEsaid, he did not see how it was possible to carry out the proposal of the hon. Member. An effectual audit of an insurance company's accounts often took 12, 16, or 18 months, and if several of these went on at the same time, what would the Government do, seeing that the Board of Trade had no staff of auditors? There were many instances of a perfunctory audit, where the auditors were entirely under the thumbs of the directors; but, on the other hand, there were auditors of the highest character, who would not pass anything which was at all questionable. What was wanted was not a Government audit, but that shareholders should take a more prominent part than they now took in the election of auditors, instead of leaving it in the hands of the directors.
  MR. GILPINsaid, he believed that the persons immediately interested were the best able to take care that the audit was sufficient. He objected to the growing tendency to push every kind of responsibility upon some public Department. An auditor appointed by the Board of Trade was just as likely to go

  1179
  wrong as one appointed by a body of business men who knew that their interests were concerned in procuring an accurate statement of assets and liabilities. He also objected to a Government audit because of its expense.
  MR. HERMONsaid, he would remind the House that only last night they had heard of a case in which, if the Government had inspected their own accounts properly, they would have saved £2,000 to the country. Government inspection, therefore, would not do everything. The best security was in seeing that the Board of Directors were men of business, who would act in public as they would in private life.
  MR. SHAW LEFEVREsaid, the effect of the Amendment would be to compel the Board of Trade to make not a mere audit but an actuarial investigation once in every five years, in addition to that made by the company, and the Board would be responsible for the Return, so that in case of any mistake the State, he presumed, would be called upon to make good the losses sustained by the policyholders. Such an Amendment would greatly enlarge the operation of the Bill, and would extend it in a dangerous direction. It was one thing for the Government to adopt the business of insurance; it was quite another thing for them to guarantee the business of other people. Then the Board of Trade had no proper staff for conducting these investigations, and would have to appointa large number of persons whom it would be very difficult to obtain apart from those employed by the insurance companies, and who would therefore probably be persons of inferior capacity. An independent audit apart from the Board of Trade would be of great value, and if he could see his way to secure such an audit for the policy holders he should be glad to do so, but the Amendment was not one he could advise the House to accept.
  MR. SYNANsaid, he would suggest that the audit should not be a compulsory one. He had framed a clause providing that the Board of Trade might grant an audit if applied for by a certain proportion of the persons interested in the company.
  MR. C. TURNERsaid, that where the actuary was a salaried officer, and had no commission upon the premiums, he was not interested in doing anything
  1180
  wrong. If the public would not concern themselves to ascertain whether the directors were not only men with handles, to their names, but also whether they were men of character and business capacity, it would be difficult for the Government to take care of them. The auditors, moreover, were appointed by the shareholders, and if the auditors did anything that was improper, it was because the shareholders would not look after them. He defied the Government to take care of people who would not take care of themselves.
  MR. CRUM-EWINGsaid, he would give his support to the clause as it stood. There could, be no greater mistake than to place dependence upon officers appointed by the Government or by the Board of Trade.
  MR. GOLDNEYsaid, they ought to take a wider view than that generally adopted. The general public were interested, because income tax was not charged on premiums, and in that way the companies were subsidized to the amount of £150,000 a year. The public had, therefore, a right to a general statement of accounts, in order that they might judge for themselves whether companies so favoured were rightly conducted. In all cases in which companies had collapsed the allowance made by the Government to encourage providence had been virtually thrown away. There ought to be an independent auditor, and the accounts ought to be deposited with the Registrar General, where everyone might have access to them.
  MR. BARNETTsaid, he could not admit that the public were interested in the way represented by the last speaker.
  Amendment, by leave, withdrawn.
  Clause, as amended, agreed to.
  Clause 8 (Statement of life and annuity business).
  MR. STEPHEN CAVE MR. STEPHEN CAVE moved the insertion of these words, to obviate inconvenience in the cases of certain companies:—"Or within three years if the company's next investigation falls in the third year after the passing of this Act."
  Amendment agreed to.
  MR. GORDONsaid, he wished to move an Amendment to extend the time for the preparation of the statement from "six" to "twelve" months after the date of the investigation prescribed by

  1181
  Clause 7. The statement would require to be based not only on facts, but also on actuarial valuations, which, in the name of a large company, would require a long time. He begged to move, in line 2, to leave out "six" and insert "twelve."
  MR. STEPHEN CAVEsaid, there was also on the Paper an Amendment in a contrary sense, to reduce the time from "six" months to "three." Between the two extremes he thought six months reasonable, and the case for twelve months was rather overstated.
  MR. ANDERSONsaid, he would propose to say—"After the completion of the investigation."
  MR. STEPHEN CAVEsaid, that the "date" was that of its completion.
  Amendment negatived.
  Amendment proposed, in line 5, to leave out "three" and insert "five."—(Mr. Wren-Hoskyns.)
  Amendment, by leave, withdrawn.
  Clause agreed to.
  Clause 9 agreed to.
  Clause 10 (Statements, &c., to be signed and printed and deposited with Board of Trade).
  MR. W. SHAWsaid, he thought the statement should be signed by two directors as well as by the chairman. He, therefore, begged to move, in line 15, after "chairman" to insert "two directors."
  MR. STEPHEN CAVEassented, though he thought it unnecessary.
  MR. GILPINsaid, it was enough to bind all the directors if the chairman signed on behalf of the Board.
  MR. H. B. SHERIDANsaid, the chairman must necessarily make himself familiar with many items, which the other directors could not. The Amendment would add still more to the difficulties and expense which already surrounded the management of insurance companies.
  MR. M'LARENsaid, these remarks showed the value of the Amendment, the object of which was to prevent a man evading responsibility by ignorance. The Amendment would secure that at least two directors would look after the affairs of the company. At present they were, with the exception perhaps of the chairman, almost unacquainted with the business they undertook to direct.
  MR. GOLDNEYsaid, that there was a precedent for the proposition in the Railway Companies Act.
  Amendment agreed to.
  MR. T. CAVEsaid, he thought that the time to be allowed for printing and delivering the statement of accounts should be reduced from six months to three. He begged to move, in page 3, line 20, to leave out "six" and insert "three."
  Amendment negatived.
  MR. GORDONsaid, he would beg to propose, as an Amendment, that every deposited statement should be accompanied by the abstract only of the actuarial report last made, and not by the report itself. He moved, in line 22, after "the" to insert "abstract."
  MR. STEPHEN CAVEsaid, the report must be in existence, or else an abstract of it could not be prepared as required by Clause 7, and the object of requiring the report to be lodged with the Board of Trade was that the public might have an opportunity of testing the accuracy of the abstract. He must oppose the Amendment.
  MR. BARNETTsaid, such reports were usually voluminous, and often contained matters which it was hardly fair to allow everybody to overhaul.
  MR. SCLATER-BOOTHsaid, he must express his approval of the Amendment.
  Amendment negatived.
  Clause agreed to.
  Clause 11 (Copies of statements to be given to shareholders, &c).
  MR. T. CAVEsaid, he would propose in page 3, line 26, to leave out "delivered," and insert "posted."
  Amendment proposed, in page 3, line 26, to leave out the word "delivered," and insert the word "posted."—(Mr. Thomas Cave.)
  MR. W. SHAWsaid, he thought the accounts, in which all the shareholders were interested, should be sent to them, so that they might not have the annoyance of going to the office for them.
  MR. C. TURNERsaid, the expense to largo companies of having to send copies by post would be enormous.
  MR. M'LARENsaid, he would support the Amendment; but it was his intention to move that these statements be sent only to policyholders within the United Kingdom.
  MR. STEPHEN CAVEobserved, that a great mass of these papers, after being delivered, got into the waste-paper basket, and it might be assumed that all who appreciated them would take the trouble to send for them.
  Question put, "That the word 'delivered' stand part of the Clause."
  The Committee divided,:—Ayes 119; Noes 46: Majority 73.
  MR. W. SHAWsaid, he thought that as the Committee would not sanction the proposition to send the documents by post, it ought to be provided that they should, at least, be delivered to the shareholders without the trouble of application. He would, therefore, propose an Amendment, in line 27, to leave out "on application."
  SIR JAMES LAWRENCEsaid, that this Was a matter of importance to all commercial men and persons connected with companies. From what had come before him in another place, he believed that many persons would have been saved from ruin if an enactment of this kind had made it imperative on companies to deliver their accounts to the shareholders.
  MR. RUSSELL GUENEYasked how these documents and accounts could be delivered to a shareholder who happened to be in Japan?
  MR. CANDLISHsaid, that that difficulty would be got rid of by adopting the words "within the United Kingdom," which the hon. Member for Edinburgh (Mr. M'Laren) proposed to add.
  MR. W. SHAWsaid, that could be got over by posting them.
  MR. SHAW LEFEVREsaid, the Committee had already decided not to adopt the word "posted." This was the same Amendment in another form.
  MR. GOLDNEYsaid, railway companies sent their statements of accounts by post, and why not insurance companies?
  Amendment negatived.
  Clause added to the Bill.
  Clause 12 (Amalgamation or transfer).
  MR. T. CAVEsaid, he would beg to move to leave out all after "transfer," in line 38. After the failure of the Albert Company a natural prejudice had existed in the minds of the public with respect to amalgamation; but he did not think
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  these prejudices would continue to prevail or would exercise any undue influence on the minds of hon. Members sitting in the House. If the clause, as it stood, were adopted, the amalgamation of two companies, in the future, would be absolutely impossible. It was required that one-half of the policyholders should give their assent in writing before an amalgamation could be effected. There would be much difficulty, he believed, in getting those documents, and he thought that the greatest facilities should be given for such a purpose. In a case where two companies might be too weak to walk alone, amalgamation, if properly carried out, might be judicious, for then there would be only one Board of Directors, one staff, and one body of agents to maintain. His hon. Friend the Member for Bandon (Mr. W. Shaw) proposed, as an Amendment, to leave out the words requiring the written assent of one-half, and to substitute certain words providing that any policyholder or annuitant in the company, might, within a month after receiving such notice, elect either to agreed to such amalgamation or transfer, or might require the company to purchase his life policy or annuity, the value to be settled by agreement or arbitration. He would not press his Amendment to a Division; but he wished to obtain an expression of opinion from the Committee on the subject.
  MR. ANDERSONsaid, amalgamation had been the fruitful source of fraud, and many companies had been got up for that purpose. He therefore hoped the clause would be left as it stood.
  MR. STEPHEN CAYEobserved that his object was not to interfere unnecessarily with amalgamations and transfers, which, in many instances, were very proper proceedings. His only wish was that they should be carried on openly and fairly, and that no means for effecting fraudulent amalgamations and transfers should exist in future. With respect to amalgamations, he provided in the Bill that no amalgamation should be made without proper notice to the policyholders in both companies; and in case of transfer he had only gone so far as to require notice to be given to each shareholder in the company to be transferred. This provision, combined with the enactment embodied in Clause 14, would provide a safeguard against fraud.
  MR. G. B. GREGORYsaid, he thought there might be a difficulty in giving notice under the 12th clause, and he would suggest that the notice should be sent to the persons by whom the last premium was paid.
  MR. T. CAVEsaid, he was desirous that the fullest notice should be given to all parties.
  MR. H. B. SHERIDANsaid, there seemed to be some misconception entertained by the Committee with reference to amalgamation. It was not his intention to propose any Amendment to the clause; but he was prepared to support the hon. Gentleman who had introduced it (Mr. T. Cave). An impression appeared to prevail that only a few amalgamations had taken place, and that those amalgamations had been characterized by fraud. Now, so far as he knew anything about amalgamation, he must say that he had never seen symptoms of any discreditable proceedings on the part either of the directors or of any other gentlemen by whom the negotiations were to be conducted. With respect to the Medical, Invalid, and General—a company with the affairs of which he was acquainted—he might say that the subject of amalgamation was fully considered by the two Boards. Legal advice was called in, and no steps were taken until the consent of the shareholders to the transfer was obtained. Amalgamation was the rule, and not the exception. It was on record that as many as 200 amalgamations had taken place, and he believed it was owing to that principle that insurance companies compared so favourably with all other descriptions of joint-stock enterprize in regard to solvency. If he had been in Order, when Clause 3 was proposed he should have embraced the opportunity of addressing the Committee upon the present position of insurance companies; but as the Chairman had ruled that it was not proper for him to deliver such an address, he did not propose further to revert to it. Had he been allowed to do so, he should have shown how fallacious most of the opinions were on this subject. He believed that in the course of a very short time there would not be more than one insurance company which would be otherwise than solvent, and in that company the deficiency was, according to the last report, less than one year's income, and not a single shilling
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  of loss was likely to be ultimately sustained by the policyholders. £2,000,000 of uncalled-up capital were yet at their service. The Albert had only amalgamated eight times, and not, as had been said by some, 67 times, and it was because of the amalgamations that it was in so good a position. The oldest, the wealthiest, and the most respectable of the insurance companies had practised amalgamation. He might allude especially to the Accidental, the Albert, the Alliance (three times), the Eagle (19 times), the Law Union (eight times), and others. He should not have addressed the Committee had it not been for the remark that amalgamation had not been practised successfully in connection with life insurance companies, and for the harsh manner in which the subject had been treated.
  LORD GEORGE CAVENDISHsaid, that when two companies proposed to amalgamate, one of the conditions should be, that those of the shareholders who dissented should receive, at the end of six months, the surrender value of their policies in full.
  MR. ALDERMAN LUSKsaid, he thought the clause very fairly drawn.
  Amendment, by leave, withdrawn.
  MR. W. SHAWsaid, he proposed to move, in line 41, to leave out from "personally" to "obtained" in page 4, line 3, and at end to add—
  "And any life policyholder or annuitant in such company may, within one month after receiving such notice, elect either to agree to such amalgamation or transfer, or may require the company to purchase his life policy or annuity, the value to be settled by agreement or arbitration."
  MR. STEPHEN CAVEobjected to the Amendment, on the ground that it would render no security to the policy-holders, but would only facilitate the withdrawal of some smart people.
  Amendment, by leave, withdrawn.
  Clause agreed to.
  Clause 13 (Application to Court).
  MR. SYNANsaid, he would beg to move, in line 11, to leave out "one-fourth," and insert "two-fifths," the effect of which would be to require the consent of two-fifths of the policy holders. The fact that the Albert had amalgamated with 22 rotten companies, and spent £3,000,000 on the various trans-

  1187
  actions, was a sufficient vindication of the Amendment.
  After a few words from Mr. STEPHEN CAVE,
  MR. H. B. SHERIDANsaid, the hon. Member (Mr. Synan) had again misled the Committee as to the amalgamations with the Albert. The Albert had amalgamated not with 22, but with eight offices, connected with which there were many Members of both Houses of Parliament; and, so far from being rotten, they had, at least, £2,000,000 of uncalled capital.
  MR. KNIGHTsaid, these transactions were carried on by vastly clever fellows, who were ready to represent bankrupt concerns as solvent, and he hoped his right hon. Friend would introduce some words which would secure that there would be some offices to give a bonâ fide value.
  MR. T. CAVEsaid, he could confirm the hon. Member's statement. He admitted that it had been too easy to get a valuation put forth quite at variance with the real value.
  Amendment, by leave, withdrawn.
  Clause agreed to.
  Clauses 14 15 and 16 agreed to.
  Clause 17 (Penalty for non-compliance with Act).
  Amendment proposed, in page 5, line 20, after "Trade," to insert—
  "Which notice shall be published in one or more newspapers as the Board of Trade may direct, and after such publication."—(Mr. Stephen Cave.)
  Amendment agreed to.
  Clause ordered to stand part of the Bill.
  Clauses 18 and 19 agreed to.
  Clause 20 (Other circumstances under which company may be wound up by the Court of Chancery).
  MR. ANDERSONsaid, he would beg to move, in page 5, line 33, to leave out "one or more policyholders or shareholders," and insert "not less than five shareholders or ten policy-holders." The effect would be that, instead of the Court being empowered to make an order to wind up a company on the application of any one policyholder or shareholder, it would not be able to do so unless five shareholders or 10 policy holders co-operated for the purpose. The clause would at
  1188
  present give too much facility for wrecking companies.
  MR. STEPHEN CAVEopposed the Amendment on the ground that it was better that the Judge should have his attention directed to the merits of the application rather than to the number of people making it. This was now the law in respect to shareholders in joint stock companies, and it was merely intended to place policyholders in the same position.
  SIR DAVID SALOMONSsaid, he did not think five shareholders or 10 policyholders too large a number.
  MR. SHAW LEFEVREsaid, there was nothing at present to prevent a single shareholder making an application to the Court of Chancery to wind up a company, and the Court, on such application, would determine whether the company was insolvent. The clause cleared up the doubt whether a policy-holder was sufficiently a shareholder to make up such an application.
  MR. H. B. SHERIDANsaid, he thought the advertisement required to be published in one or more newspapers relative to the winding-up of a company by the Court of Chancery might have a very injurious effect on the company. It was well known that proceedings for winding up a company were often taken by parties who, as in the case of the European, could not pay the costs they were adjudged to pay. He would suggest that the words—
  "Where copies of such petition have been served upon the proper officers of the company, no advertisement of the petition shall take place without the express sanction of the Judge,"
  should be added.
  MR. RUSSELL GURNEYsaid, he would point out that the introduction of such words would be altogether futile, because they could not prevent a newspaper inserting anything it pleased.
  MR. G. B. GREGORYsaid, that the wrecking of public companies had become almost a trade, which was carried on by persons of disreputable character, who actually lived on the ruin they inflicted. He thought, however, that the evil was to be checked rather by the wise exercise of the jurisdiction of the Court than by the action of the Legislature. He preferred the clause as it stood.
  MR. D. DALRYMPLEsaid, he hoped the Amendment would be adopted.>
  MR. ANDERSONsaid, as he wished that that Bill should pass as rapidly as possible, he would not divide the House.
  Amendment, by leave, withdrawn.
  Amendment proposed, in page 5, line 42, after "sufficient," to insert "with the future premiums receivable by the company."—(Sir John Lubbock.)
  Amendment agreed to.
  Clause, as amended, ordered to stand part of the Bill.
  Clauses 21, 22, and 23, agreed to.
  On Motion of Mr. BOWRING, New clauses (List of shareholders) and (Deed of settlement) added.
  MR. T. CAVEsaid, he rose to move a new clause requiring companies to pay, on request of the holders of any life-policy issued by them, the equitable surrender value of policies, which should, in no case, be less than one-third of the premiums paid in respect of such policies, as was, indeed, the uniform practice of all respectable companies. The hon. Member concluded by moving the clause of which he had given Notice (Surrender value of policies).
  MR. STEPHEN CAVEsaid, that no doubt, many cases of hardship had arisen where offices refused a surrender value. But this clause went too far; he himself had prepared an Amendment to the 6th Schedule which accomplished all that was really practicable.
  Clause negatived.
  MR. T. CAVEsaid, he would next propose a new clause (Declaration of dividends), which had the assent of the right hon. Gentleman opposite, the author of the Bill (Mr. S. Cave).
  MR. SHAW LEFEVREsaid, he hoped the clause would not be pressed, as it provided no machinery for enforcing the obligation which it imposed.
  Clause negatived.
  MR. T. CAVEsaid, he wished to explain that he had given way at the request, privately made, of the right hon. Gentleman opposite (Mr. S. Cave), who was very anxious that the Bill, if possible, might be finished that afternoon. He accordingly had no objection to withdraw all the Amendments of which he had given Notice, and would bring them up upon the Report.
  Schedules amended, and agreed to.
  Bill reported; as amended, to be considered upon Monday next.

SALE OF LIQUORS ON SUNDAT BILL.
(Mr. Rylands, Mr. Candlish, Mr. Birley, Mr. Osborne Morgan.)
SALE OF LIQUORS ON SUNDAT BILL.

  [BILL 57.] SECOND READING.
  Order for Second Reading read.
  MR. RYLANDS, in moving that the Bill be now read a second time, expressed considerable disappointment at the inability of the Government to take up the measure; but said he could not blame the Government, because it was evident that they had more to do than they could get through this Session. He believed he was justified in saying that there was a strong feeling out-of-doors in favour of the Bill, and that public opinion was tending in the direction of restricting the sale of drink on Sundays. He did not know whether the hon. Member for the City (Mr. Alderman Lawrence), who had given Notice of his intention to move the rejection of the Bill, represented the licensed victuallers; but, if so, the publicans were taking a very unwise course, which would have the effect of driving many who only desired moderate reform in this matter to support the legislation advocated by the hon. Member for Carlisle (Sir Wilfrid Lawson). His only object was to limit the evil which existed; and he thought it monstrous that, while all other places of amusement and occupation were closed on Sunday, public-houses should be left open to tempt the working classes to indulge in a vice which not only robbed them of their earnings, but interfered with their ability to obtain money by their daily labour. When hon. Members said that if this Bill passed clubs ought also to be dealt with, he must tell them that the objection did not come from the poor themselves. He was in a position to state to the House that a canvass which had been taken in various parts of the country showed that in many of the large towns there had been a very considerable manifestation of opinion in favour of Sunday closing. In one case, where the canvass extended over a considerable number of towns and populous localities, the result was that, out of the entire number of householders, no less than 350,000 heads of families expressed themselves in favour of the Sunday closing of public-houses; about 60,000 were opposed to it, and 37,000 declined to express any opinion on the subject.

  1191
  In some of the towns there was a considerable number of the publicans themselves who expressed themselves in favour of early closing. In Liverpool, in 1860, there was a separate canvass, and the results were of the most important character. The number of inhabited houses was 65,000; returns were obtained from 60,000, of which the heads of families in no less than 44,000 were in favour of entirely closing public-houses on Sunday; 3,330 were opposed to it, and 6,417 were in favour of partial closing or increased restriction on the sale of intoxicating liquors on the Sunday. In Birkenhead, also, the result of the canvass was very favourable, showing how large a number of persons were in favour of closing the public-houses on that day: 3,204 working men, and 1,356 belonging to other classes of society—making a total of 4,560—were in favour of Sunday closing; while the number of persons who expressed an opposite opinion was only 186 working men, and 236 of other classes of society—making a total of 422. At Runcorn, out of 903 houses visited, the heads of 844 were in favour of Sunday closing, only 33 against it, and 26 declined to sign either for or against it; and, out of 19 public-houses canvassed, 13 were in favour of Sunday closing, 4 against it, and 2 neutral. At Welshpool a mutual agreement was almost come to among the landlords to close their houses on Sunday; but the movement failed from the resistance of two landlords. At Bradford 90 per cent of the working population were in favour of Sunday closing. If the working men in such large bodies were in its favour, he did not see why, because there happened to be some idea of the desirableness of keeping open the clubs—with which no one desired to meddle—they should raise difficulties which had not been raised by the working men themselves. He ventured to say that, if this measure were adopted, the people who would be most benefited would be the working men. Men would not be led away by impulse, finding the public-houses open, and thus they would be able to spend a considerable time in harmless recreation instead of in a foolish and reckless manner. In reference to Sunday drinking, one great reason which he had for pressing this Bill on the House was the fact that the evidence
  1192
  proved that there was a much larger amount of crime arising out of drink in consequence of keeping open the public-houses on Sundays, and that the number of cases which had to be dealt with on the Monday by the police magistrates was larger than on any other day of the week. He held in his hand the Returns, signed by the chief constable, of the city of Manchester; from which it appeared that, in 1866, there were taken into custody, on charges arising from drunkenness, on ordinary days of the week, 22 on the average, but on Sunday, 40. In 1867 the number reported as being taken up for this crime was 28 on ordinary days, and 40 on Sunday; in 1868, on ordinary days of the week, 24, and on Sundays, 37; and in 1869, on ordinary days, 29, and on Sundays, 42; so that every year showed a great increase of drunkenness on the Sundays, as compared with any other day of the week; and, to show that the evil was not decreasing, it was only necessary to turn to the records of the police, which would show that not only was there no diminution in the number of cases, but that they increased exactly in proportion to the facilities afforded, and the temptations thrown out to men to drink; and that they diminished on week days, when the working men were occupied at their work. To say nothing of the evidence of the results of legislation to repress drunkenness during the last 20 years, he would only point to that which had been furnished, by recent legislation; and he would ask any reasonable man in that House to say whether they could, by legislation, very materially diminish the evils of drinking? Hon. Gentlemen might say that they could not shut men's mouths and put a stop to drinking by law; but those who made such an assertion could only be very imperfectly acquainted with the facts of the case. The hon. Member for Essex (Sir Henry Selwin-Ibbetson) introduced an admirable Bill on this subject last year; and he had already seen the fruits of his labours, because there could be no doubt that there was a considerable diminution in the drunkenness and crimes arising out of the houses which his Bill affected. By diminishing the number of hours during which a public-house or drinking-shop was allowed to be open, they would always produce a corresponding benefit by the diminution of

  1193
  crime; and, therefore, he appealed to the Government and to the House to support him in this Bill—a Bill which he believed, if carried out to its full extent, would be of great advantage, not only to the working classes, but to every other portion of the community. The great evil and vice that degraded the people of this country was the vice of drunkenness. He did hope that that household Parliament would do something to preserve them from it, and feel that judicious legislation could do a great deal to alleviate the evil, and thus elevate the moral, social, and religious condition of the people.
  MR. BIRLEY, in seconding the Motion, said, that probably no question had excited so much interest among the working classes in the manufacturing districts, and among those who were interested in their welfare, as this one of imposing a check on the liquor traffic. This was proved by the Petitions which had been presented, and the Returns which had been referred to. Sunday drinking was a plague-spot in the life of our labouring classes. How was it that on the Monday, the day after the day of rest, the working classes had more difficulty in getting to work than on any other day of the week? And how was it that there was more vice on the Sunday than on any other day? The Beershop Act of 1830 was intended, not to give facilities for tippling during the whole or the greater part of Sunday, but to enable the working man to procure a wholesome and unadulterated beverage and carry it home to his family. Its operation had, however, been quite contrary to what was anticipated. It had been argued that any further attempt to restrict the opening of public-houses on Sunday would not be efficacious; but, in answer to that objection, he would merely refer to the Wilson-Patten Act, which, although only in operation for 10 months, confessedly diminished to a large extent the amount of drunkenness on Sunday. The general desire of the working classes for a measure like this, and the acknowledged fact that a vast amount of crime was owing to the drinking habits of the people, ought to be arguments sufficiently weighty to induce the House to pass the Bill.
  Motion made, and Question proposed,
  "That the Bill be now read the second time."—(Mr. Rylands.)
  MR. ALDERMAN W. LAWRENCE, in moving that the Bill be read a second time upon this day six months, said, he gave the supporters of the Bill credit for their desire to prevent drunkenness; but he thought they were committing a great mistake in bringing forward this Bill. He felt convinced that drunkenness could not be prevented by the passing of an Act of Parliament, while from restrictive legislation evils of a kind that were not foreseen would arise. He admitted, indeed, that the Act of 1839 had been productive of great advantages; but it should be remembered that it was passed by the common consent of the people in all parts of the country, and of the licensed victuallers themselves. The statistics which had been brought forward went to show that the working classes in the North of England were lapsing into habits of drunkenness and profligacy. He trusted the statistics were inaccurate; but, however this might be, it was certain that in the metropolitan district drunkenness was annually diminishing; and, therefore, for London, at all events, a measure of this highly restrictive character was quite unnecessary, nor would it be supported by public opinion. In 1854 Colonel Wilson-Patten's Act was passed, which limited the opening of the public-houses on Sundays from 1 to half-past 2, and from 6 to 10 in the evening. There was great discontent in consequence of the passing of that Act, and it was repealed in 10 months, and the Act of 1855 was passed, which provided that the houses should be closed till 1 on the Sunday, and again between 3 and 5, from which latter hour they were to be open till 11 at night. That Act had worked well. This Bill was of so sweeping a nature that it would be impossible for any Government to carry it out. The case of Scotland was not at all analogous, for the Scotch people drank whisky, which could be kept in bottles; whereas the English were accustomed to drink beer, which could not be conveniently kept in that manner. If the object was to prevent drunkenness by closing public-houses, why was not the further and more effective step taken of preventing the manufacture of intoxicating drinks? The Commissioners of Police attributed the diminution of drunkenness in the metropolis to the greaterk facilities of travelling, and to the open

  1195
  spaces set apart for the people. The hon. Member was proceeding to enumerate the conflicting definitions given of a "bonâ fide traveller "by various legal authorities, when the clock pointed to a quarter to 6, and, in accordance with the Standing Order,
  Debate adjourned till To-morrow.

  LOCAL GOVERNMENT SUPPLEMENTAL (NO. 3) BILL.
  On Motion of Mr. KNATCHBULL-HUGESSEN, Bill to confirm certain Provisional Orders under "The Local Government Act, 1858," relating to the districts of Burton upon Trent, Chiswick, Derby, Harrogate (two), Kidderminster (two), Kingston upon Hull, Northam, Redcar, and Trowbridge, ordered to be brought in by Mr. KNATCHBULL-HUGESSEN and Mr. Secretary BRUCE.
  Bill presented, and read the first time. [Bill 188.]

  EAST INDIA CONTRACTS BILL.
  On Motion of Mr. GRANT DUFF, Bill to render valid certain Contracts informally executed in India, ordered to be brought in by Mr. GRANT DUFF and Mr. STANSFELD.
  Bill presented, and read the first time. [Bill 186.]
  House adjourned at five minutes before Six o'clock.