HC Deb 26 June 1916 vol 83 cc659-65

Any order or decree of any Court in the United Kingdom having authority to make the same whereby the right to trans- fer or call for a transfer of any Government Stock is vested in any person shall be sufficient authority to the Banks of England and Ireland, to the National Debt Commissioners, to the Postmaster-General, and to any savings bank authority to allow the transfer of the stock in accordance with the tenour of the order or decree.

An official extract of any such appointment as is mentioned in Section thirteen of the Judicial Factors (Scotland) Act, 1889, shall, where any Government Stock forming part of the estate under the charge of the person so appointed is specified in such official extract or in a certificate under seal by the Accountant of Court produced along with such extract, be deemed for the purposes of this Section to be a decree whereby the right to transfer such Government Stock is vested in the person so appointed.

In this Section the expression "Government Stock" has the same meaning as in the Savings Bank Act, 1893, as amended by any subsequent enactment.

Amendment made: Leave out the words "having authority to make the same."—[Mr. Montagu.]


I beg to move, after the word "Stock" ["transfer of any Government Stock"], to insert the words "Colonial Government Stock, India Stock, or other investment or property."

I wish to acknowledge, in the first place, that on more than one occasion, when I have drawn the attention of the right hon. Gentleman to some trouble which we encounter in Scotland, he has met me in the most reasonable spirit, and I hope he will do so once more. What I may call the original position in this matter was really a very absurd one. It consisted in this that if a judicial factor, acting under the instructions of the Court of Session in Scotland, our Supreme Court, found himself in possession of a miserable holding of, perhaps, £100 of public debt, and was given a good title to that by the Court of Session, he was condemned to spend a sum of about £30 in having his title recognised in England as effective when he came to do business with the Bank of England. That position, of course, is very unreasonable, and, so far as the British Public Debt is concerned, the right hon. Gentleman's Clause does away with it. I should like to ask how such a state of matters can have arisen as the refusal of the Bank of England to accept the official extract of their appointments despite the provisions of Section 13 of the Judicial Factors (Scotland) Act, 1899? It is quite well understood that judicial factors in Scotland hold a very large amount of our Public Debt. The figure cannot possibly be less than £5,000,000. It is also well known that the Accountant of Court, who has the supervision of these judicial factors, recently gave these factors to understand that he practically required them to invest their money in Exchequer Bonds and ' securities of that kind. He went the length of saying that, although he was anxious to do so, and in fact did so, unless the Bank of England would in some way or other depart from this attitude he would reconsider his decision. I wish to ask what underlies this attitude of the Treasury and the Bank of England. It appears to me to be purely due to ignorance in high quarters here of matters with which I think they should be rather ashamed to confess that they are not perfectly familiar. I have here a copy of a Treasury letter, dated only a couple of months ago, in which the statement is made that My Lords are not aware what orders the Scottish Courts have power to make. It appears to me that my Lords, who have supervision of Scotland as well as England, should really be ashamed to make a statement of this kind. Further, I understand the opinion was given by Sir William Latham in 1902 that the officers of the Bank accustomed to English law and practice are in a difficulty when confronted with such a document as the Interim Act and Decree of the Court of Session. Are the functions of the Bank of England not to act as bankers for the Imperial Government? Is the Bank of England itself not an Imperial institution, and, if that be so, is it not unreasonable to the last degree that the Bank of England should think that it is entitled to disclaim all knowledge of what goes on in the Court of Session in Scotland? If the Bank of England had ever had some difficulty in knowing what went on in some small Burgh Court in Scotland, I could quite understand that, but for the Bank of England and the Treasury to take up the position that they know little and practically care less about the powers and proceedings of the Supreme Court in Scotland is, I think, a position which is very hard to justify. I am sorry the Lord Advocate is not here, because I wish to make sure from him that he is satisfied that the Government's Clause, even as far as it purports to go, is really quite watertight. I dare say the right hon. Gentleman will be able to give me that assurance, but at one stage there was doubt as to whether the Clause really was watertight—that is to say, doubt as to whether an official extract such as we deal with in Scotland was of the same character as a vesting order under Section 35 of the Trustee Act, 1893, or Section 136 of the Lunacy Act, 1890. Of course the object of the Clause will be defeated altogether unless that is so.

But I wish the right hon. Gentleman to go somewhat further than his Clause goes. This affects us in Scotland in so far as our judicial factors hold considerable blocks of the public debts of the various Colonies, and it appears to me that the injustice to the judicial factors in Scotland is just as clear in the one case as in the other. I do not think the right hon. Gentleman will really argue that it is quite a justifiable position that if a judicial factor in Scotland holds £100 of some public Colonial debt, possibly of some debt issued for the purposes of the War, he should be obliged to spend some £25 or £30 in London in getting his title, given to him by the Court of Session, recognised as effective by the Bank of England. I do not know whether this Bill itself will be the most convenient Way of dealing with the difficulty, but in one way or another the difficulty should be dealt with, because it is not only a great inconvenience to us in Scotland. We decidedly object to spending £25 to £30 in this way. We regard it as simply shovelling money unnecessarily into the pockets of English lawyers. But apart from that it is a great injustice to the Colonies. Why should the Colonies, which come into our market and borrow, feel that if people in Scotland take up their debts in this way they do so at the risk of having to spend £25 in payment to English lawyers and English officials to serve no good end, but simply because they happen to hold such an investment? I think a policy of this kind is quite out of date. I hope the right hon. Gentleman, if he cannot deal with the matter just now, will at least give us a promise of some kind that he will deal with it at some convenient opportunity. On this point the Accountant of Court writes that Unless 'Government Stock' covers all Government securities in which trustees (and consequently judicial factors) can invest, including Colonial Inscribed Stocks and Current War Loans, we shall be no better oft" than before. I do not think that really is the intention of the right hon. Gentleman. I have once or twice said rather hard things of the practice of the Bank of England. At the same time I should not like the idea to get abroad that we in Scotland are unmindful of the great services which the Bank of England can render. We are not in the least likely to forget that the Bank of England was founded by a Scotsman in the first place, and all through this troublous time it has been managed by a Scotsman, of whom we in Scotland are really proud. My sole object is to relieve the Bank of England of some antiquated fetters which I am perfectly confident place it in lather a false position, and so far from seeking to derogate from their powers and responsibilities I only wish to enable the Bank of England to render a fuller account of them to us in Scotland who are so anxious to support the Bank in every way in its heavy task of co-operating with the Treasury at present.


There is a good deal of substance in what my hon. Friend has said. It appears that the Bank of England is a law unto itself, and is declining to do a great many things which it ought to do. The title of a judicial factor in Scotland is precisely the same title as a trustee in bankruptcy or a liquidator here. The Bank of England are bound to recognise that, and bound to issue whatever stock remains in the name of the trust, yet the Bank of England make a great deal of difficulty and require certain procedure and cost to be incurred, which is quite wrong. Some of the Scottish bankers raise no difficulty about it. The Bank of England ought to be made to give effect to these things without necessitating costs, expenses, and fees in London before the Scottish official Trustee can get registration as the owner of the stock for the benefit of those concerned.


My hon. Friend knows so much about Scottish banking law that it is impossible for an Englishman who is not a lawyer to follow him in the intricacies of his case. Ask any Englishman to look at Clauses 43 and 44 of this Bill, and to realise from those two Clauses that we are face to face with an historic grievance from the great country of Scotland which has been in existence for generations. It is due entirely to the great per- tinacity of my hon. Friend (Mr. Currie) that, after bringing this subject up again and again, he has succeeded in bringing together the conflicting interests and getting put down upon the Paper an agreed Clause to deal with the grievance which he discovered. He asked for a pledge from the Government to incorporate that Clause in this Finance Bill, and we promised him that such a Clause would be incorporated if we could get agreement. We stated from time to time, in answer to his oft-repeated questions, that, if we could get agreement, we hoped to incorporate it in the Finance Bill. I now congratulate him upon having achieved his object, and I venture with all friendliness, and without overstating my point, to ask him not to go further now than what he asked for and what he has got. He asked for an alteration of the law. The poor old Bank of England is not a law unto itself. Like everybody else in this country, it is governed by Statute, and it is to alter those Statutes that the hon. Member has concentrated all his energy. He asked for an alteration of the law and he got it, and now he discovers that he did not ask for enough. If he knew of all the negotiations and the dovetailing of the different interests which have had to take place in order to get this agreed Clause he would understand how serious is the new request. He is going right outside the limits of the Finance Bill. He is seeking by an innocent Amendment to alter the general law as to the transfer of property. I deprecate going any further to-night. We have got the assent of the judicial authorities concerned; we have got agreement with the judicial authorities in Scotland, and we have got agreement with the Bank of England to the proposition which we put before them. Do not let us try to set right in five minutes the wrongs of centuries. Let it be sufficient for the hon. Member that he has made order out of chaos in the particular matter on which he has concentrated his attention ever since he entered this House. Let him use that as a stepping stone for further achievement, and spend his remaining energy on the remaining portion of the grievance during the remainder of this Parliament. Let his present achievement be sufficient for this Budget.


On the understanding that the matter is not foreclosed and that the next time it is raised, as it will be, the right hon. Gentleman will give me another instalment. I shall be glad to postpone this discussion. I thank him very cordially for what he has done in the present case. I should like to assure him that it was not at any late date that I made my discovery that I was entitled to more than I was asking. I was merely proceeding on the principle that it is well to ask for the most obvious part of a request in the first place and to leave the rest to a later date. I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Amendments made: After the word "Stock" ["any Government Stock is"] insert the words "or to receive any dividends thereon"; after the word "is" insert the words "expressed to be":

After the word "stock" ["transfer of the stock in accordance with the tenour of of"] insert the word "or to pav the dividends."

Leave out the words "the tenour of".

Leave out the words "forming part of the estate under the charge of the person so appointed is specified in such official extract or in a certificate under seal by the Accountant of Court produced along with such extract," and insert instead thereof the words "is specified in such official extract or in a certificate under seal by the Accountant of Court produced along with such extract to or forming part of the estate under the charge of the person named in the extract."

Leave out the word "appointed" ["in the person so appointed "] and insert the, word "named."—[Mr. Montagu.]

Clause, as amended, ordered to stand part of the Bill.