HC Deb 10 July 1908 vol 192 cc259-65

Order for Second Reading read.

THE PARLIAMENTARY SECRETARY TO THE BOARD OF TRADE (Sir H. KEARLEY, Devonport), in moving the Second Reading of this Bill, explained that before the Act of 1846 there existed a legal rule or doctrine which declared that a man's right of action for injuries perished with him. About this date the law altered by the passing of the Fatal Accidents Act, known generally among lawyers as Lord Campbell's Act. This gave a right of action, but afterwards a question arose as to its construction in an action where the defendants admitted negligence, but, the person killed being insured, they contended in the course of the trial that the amount recoverable out of the policy ought to be deducted from the amount allocated by the jury. The Judge so directed the jury, and this had been the law up to this time. The Government were now seeking to amend the law by this Bill. In the case of non-fatal accidents the law was different. An attempt had been made to get the Courts to apply the same doctrine to the two cases, but when an important case was before the Courts in 1874 it was decided that the money which a policy-holder was entitled to receive ought not to be taken into account in diminution of damages for a non-fatal accident. The Court held that it would be preposterous to take into account the amount recoverable under a policy in mitigation of damages. Thus, where a fatal accident occurred, and the person killed held a policy, the amount derivable from it was taken into account when the jury assessed the damages, but in the case of a non-fatal accident the jury had no power to take this action, and the holder of the policy got the full benefit of it. But the anomaly did not end here. In 1849 or in 1864—he believed it was the earlier date—the Railway Passengers Assurance Company came to Parliament, and by means of a private Bill obtained special exemption from the operation of the Act of 1846. Parliament gave special exemption to this company, and the general effect of what they expressly provided was that in the case of a fatal accident arising in connection with any policy of insurance effected by the company the damages recoverable by the representatives of the deceased person should not be liable to any deduction on account of any money received under the policy. That seemed to be rather a curious thing for Parliament to do. He believed however, that it was not the Railway Passengers Assurance Company that came and asked for this provision; it was Parliament itself in a fit of pious resolution which imposed the provision on this particular company when it asked for the granting of powers under a private Bill. Last year two other insurance companies—the Ocean and the General Accident—came to Parliament and succeeded in getting this special exemption. At this moment there were forty insurance companies clamouring at the doors of the House for private Bills asking to have the same special exemption as was enjoyed by three of their competitors. The Government, in these circumstances, thought that the general law should be amended so as to put all the insurance companies in a position of equality. They also thought that the representatives of the policy-holder should receive the entire benefit of the sum recoverable under the policy.

Motion made, and Question proposed, "That the Bill be now read a second time."—(Sir H. Kearley.)


said he could not support the Bill. He understood that the law up to the present time had been that if a man was killed in an accident his relatives could go to a jury and claim compensation from the people who had caused his death. If the jury awarded £400, that amount was paid to the relatives as representing the loss which had accrued to them. Under what was known as Lord Campbell's Act it was held that the relatives ought not to make a profit out of a man's death. It appeared that the Railway Passengers Assurance Company so long ago as 1864 or 1849 were exempted from the law in regard to participation which applied to other companies, and the two companies which the hon. Gentleman had mentioned came to Parliament last year and got a private Bill which gave them the same privilege as the Railway Passengers Assurance Company. Thereupon other companies came demanding equal rights, and, therefore, what the House was asked to-day to assent to was not a public demand, but to give particular insurance companies certain privileges in order to enable them to compete with their competitors. He did not see why the House should interfere with the ordinary law in order to grant advantages to certain companies. The proper course to take would be to cancel the powers given to the Railway Passengers Assurance, the Ocean, and the General Accident Companies. The majority of these accidents took place on the railway, but in ninety-nine cases out of 100 they were due to no fault of the railway company, and the railway companies did not wish to evade their responsibility. When railway companies accepted full responsibility for an accident, they ought to be treated justly, and the relatives of a passenger killed ought not to be allowed to make a profit out of his death. When a railway company were ready to pay to the relatives whatever loss had accrued, and if the relatives happened to have a sum of money coming to them from an insurance company, he saw no reason why that should not be taken into account in settling the amount which the railway companies paid. While the relatives should not be placed in a worse position, he failed to see why they should be allowed to make a profit out of the accident merely because certain insurance companies had succeeded in getting a private Bill smuggled through Parliament.

MR. HARMOOD-BANNER (Liverpool, Everton)

said he did not agree with the hon. Baronet the Member for the City of London in the remarks he had made about the Bill. The hon. Baronet rather put the cart before the horse, because the necessity for the Bill followed not upon two insurance companies getting a special clause last year, but upon the fact that there was a clause in the Railway Passengers Assurance Company's Act, and that a good many other insurance companies who were asking for a similar clause withdrew their applications on the promise of the Government that they would bring in a general Act dealing with this unjustifiable difference between the Railway Passengers Assurance Company and certain other insurance companies. Last year, a large insurance company asked him to look after their interests. They had a clause to this effect in the Bill they were promoting, but it was pointed out that it was not right to give them a preference while other insurance companies were left out, and they withdrew the clause. He did not know how it was that the Ocean Company and another got the clause which the Royal Insurance Company and others withdrew on the understanding that there was to be a general Act dealing with the question. He thought it perfectly clear that the railway company, in case of a fatal accident, ought not to benefit by the providence of an individual in insuring himself against the various accidents to which all were liable. The accident insurance business had grown since the passing of the Compensation Act, and it had become necessary for numerous trading interests in the country to go in for insurance. None of them would consider such a proposition as that when £1,000 was awarded for an accident on a railway a certain amount should be deducted from the damages because the person was insured. He was pleased that the Parliamentary Secretary to the Board of Trade had taken up the matter with a view of doing equal justice to all parties, and on behalf of the large insurance companies he thanked the hon. Gentleman very much for the action he had taken.

Mr. GORDON (Londonderry, S.)

said that in awarding damages in cases where non-fatal injuries had been sustained the Courts had proceeded on an entirely different principle from that which was applied in cases of fatal accident. In a case of death it had always been held by the Courts that compensation for the actual loss sustained was what should be awarded. Take, for example, the case of a child who met with a fatal accident. The child had been earning nothing and contributing nothing to the upkeep of the family with which it was connected. This was a Bill to benefit insurance companies, and he thought the House should not pass it. There were a great many cases of accidents which occurred otherwhere than on a railway, and every lawyer knew that although the person who caused the accident was legally if not morally to blame, the injured person wanted to get as large a sum as possible.

MR. RAWLINSON (Cambridge University)

said that they ought to be told whether or not the particular rights which certain insurance companies had got now should be taken away from them or whether these rights should be given to all insurance companies. He ventured to say that no real case has been made on behalf of the Bill, although he supposed it would be impossible to divide against it on a Friday afternoon. The hon. Gentleman had said that a man should get the benefits of his providence; but he would point out that the benefits of a man's providence were not to be reaped unless it took the form of insurance in some particular insurance company. If his providence took the form of buying a house or investing in Government securities, the man was not to have the benefit of it at all, according to the Bill. The Bill was simply a measure to give a privilege to a particular form of saving, viz., investing in insurance companies.

*THE SOLICITOR-GENERAL (Sir S. EVANS,) Glamorganshire, Mid.

said that the present state of the law was perfectly anomalous whatever might have been the intention of the framers of Lord Campbell's Act. It was quite true that some insurance companies under the existing law were in a better position than others in the market for insurance policies. As to this point, it would not be expedient to repeal their private Acts, and therefore the better, and indeed the only course open to them, was to redress the inequality thus existing by putting the other insurance companies on the same footing as the favoured ones. But the main ground upon which the Government recommended this measure was the public one they thought it was unfair to make from the compensation which ought to be given to the representatives of a person injured through the negligence of another where the man died from the injuries, a deduction which would not be made if the man was only injured and survived. That was the old rule of law under which a man's right of action for injuries died with his death. The whole basis of compensation was negligence. If a person was very seriously injured by being knocked down by a motor omnibus he could get the damages in full without deduction: but if he happened to die and was insured, his representatives could only obtain the balance of the compensation, although negligence had been proved, after deducting the insurance money which accrued through his own providence. It was not mainly from the point of view of the insurance companies that the Government asked for the Second Reading of this Bill, although he thought it was right to redress the inequalities existing owing to the Acts of Parliament obtained by three special companies; but upon the general grounds that persons guilty of negligence ought not to have the right to deduct from the compensation the sum received under the insurance policy by the representatives of a person whose death was caused by the injuries which resulted from the negligence.

SIR H. KEARLEY moved that the Bill be referred to a Committee of the Whole House.