HC Deb 25 July 1910 vol 19 cc1737-9
Mr. GIBSON BOWLES

asked the President of the Board of Trade if he has considered the reports of the meetings held on the 20th July with reference to the Law Guarantee Trust and Accident Society, and the statement then made by the chairman, Mr. William Harris, that the President of the Board of Trade had stated that they could not get a public inquiry; if he has also considered the refusal of the chairman to answer Mr. Arthur Lawton's question as to the transactions introduced by each director or their firms to the society and his refusal to accept an amendment calling for a full and independent inquiry; if, in view of the statement made at that meeting of the widespread loss caused by the transactions of this company and of the consequent scandal and impaired confidence thereby caused in the members of the legal profession responsible, he now considers that there is sufficient ground to justify him in moving in the matter, so as to secure full and adequate public inquiry in order to ascertain the facts; and, if he is still advised by the Law Officers of the Crown that his powers do not enable him to order such an inquiry, will he introduce a short Bill giving such extra power as may be necessary for ascertaining the truth of this matter?

Mr. BUXTON

I have read the report in the press of the meetings held on the 20th July with reference to the Law Guarantee Trust and Accident Society. I have carefully considered the question of an inquiry in all its bearings. With regard to the powers of the Board of Trade in the matter, I would refer my hon. Friend to the carefully considered answer which I gave on the 18th July to my hon. Friend the Member for South Hackney, of which I am sending him a copy. I then invited, with a view to action by the Official Receiver, statements of definite facts to be laid before me with the names of the persons who are willing, if necessary, to substantiate them on oath. No such statements have yet reached me, and probably no sufficient time has yet elapsed for their preparation. As to the suggestion that a short Bill should be introduced, I think that before I even consider so heroic a remedy, I must first be satisfied that the machinery provided by Statute cannot be applied in the present case, and that the cerditors and shareholders for some special reason are debarred from helping themselves by an application to the court. I have already endeavoured to point out that they have, apparently, got full power to petition the court for an order that the company may be wound up compulsorily, on which a full inquiry by the Official Receiver would follow as a matter of course. No doubt my hon. Friend is also aware that the court has power, under Section 174 of the Companies (Consolidation) Act at the instance of the liquidator, or at the instance of a creditor or of a shareholder of the company, to summon before it for the purpose of examination any person whom the court deems capable of giving information as to the affairs of the company, and I am informed that though these examinations are usually held in private, the court has, on due course shown, with the consent of the persons examined, from time to time ordered them to be held in open court.

Mr. GIBSON BOWLES

In reference to the statement made by the right hon. Gentleman, may I ask him whether he has given attention to the definite statement which appeared in "The Economist" that the balance sheet showed a surplus when there was in fact a deficit, and that a dividend was paid when the assets fell far short of the liabilities, and when the society was therefore really in a state of insolvency?

Mr. SYDNEY BUXTON

There were various statements in the newspaper in reference to this matter, but before I take action I must have information from those who are prepared to make a statement and, if necessary, substantiate it on oath. If some of the statements in the newspapers are correct, and if someone will bring them to me and is prepared to substantiate them, then, of course, I will give them attention. If not, I am unable to go further.

Mr. BOTTOMLEY

Will the right hon. Gentleman say whether he has also seen a definite statement made in a much more important publication than "The Economist"; but apart from that, whether there would have been the same reluctance to interfere officially if, instead of judges and members of the legal profession, this company had been under the control, say, of Mr. Hooley?

Mr. SYDNEY BUXTON

There is absolutely no foundation for such an insinuation against the Board of Trade. The question is not in the least judged by the character of the persons in control; we have to act under Statute and cannot go beyond the powers of the Statute, and under the Statute we must have information which will be substantiated by the persons giving it before we can move. If my hon. Friend has got information which would be useful in considering this matter I have already told him I will be glad to consider it and lay it before the law officers with a view, if possible, of taking action.

Mr. BOTTOMLEY

Has the right hon. Gentleman ever before known, in the history of the Department, that they required sworn statements before instituting an inquiry? If so, he shall have them.

Mr. SYDNEY BUXTON

I did not say they must be sworn statements. I said more than once what I want is a definite statement by responsible persons who, if necessary, will substantiate them on oath. I am not asking for statements on oath. What I want is bona fide statements that can be substantiated on oath. I am extremely anxious if such information comes before me that full inquiry shall be made into the matter. I can assure my hon. Friend and the House there is no desire to shield anybody or hush anything up, but quite the contrary.

Mr. GIBSON BOWLES

Does not the right hon. Gentleman think the statement that a false balance-sheet was issued to the public, and a dividend was paid when the society was in a state of insolvency is a definite statement, and sufficient foundation for inquiry?

Mr. SYDNEY BUXTON

I have not seen the statement. If anyone is prepared to substantiate it I shall be prepared to consider it.