HC Deb 14 August 1919 vol 119 cc1698-718

(1) Subject to the provisions of this Act, the Board of Trade shall have power in respect of any article to which this Act applies—

  1. (a) to investigate prices, costs, and profit at all stages, and for that purpose by Order to require any person to appear before them, and to furnish such information and produce such documents as they may re quire ; and on any such investigation they may by Order fix maximum prices; and
  2. (b) to-receive and investigate complaints that a profit is being or has been since the passing of this Act made or sought on the site of the article (whether wholesale or retail) which is, in view of all the circumstances, unreasonable, and on any such complaint they may by Order, after hear the parties,—
    1. (i) declare the price which would yield a reasonable profit; and
    2. (ii) require the seller to repay to the complainant any amount paid by the complainant in excess of such price.

(2) If, as a result of any investigation under taken on their own initiative or on complaint made to them, it appears to the Board of Trade that the circumstances so require, the Board shall take proceedings against the seller before a Court of Summary Jurisdiction, and if in such proceedings it is found that the price charged or sought about which the complaint was made or the price discovered at the investigation to have been charged or sought was such as to yield a profit which is, in view of all the circum stances, unreasonable, the seller shall be liable on summary conviction to a fine not exceeding two hundred pounds or to imprisonment for a term not exceeding three months or to both such imprisonment and fine Provided that a rate of profit which does not exceed the fair average rate earned by persons in the same way of business as the seller upon the sale of similar articles under pre-war conditions, shall not be deemed unreasonable.

(3)If any person fails to comply with or in fringes an Order of the Board of Trade under this Section, he shall be liable on summary conviction to a fine not exceeding fifty pounds or to imprisonment for a term not exceeding one month, or to both such imprisonment and fine.

(4) If any person at or for the purpose of any such investigation or in any such complaint furnishes any information or makes any representation which is recklessly or to his know ledge false in any material particular, he shall be liable on summary conviction to a fine not exceeding fifty pounds or to imprisonment for a term not exceeding three months, or to both such imprisonment and fine.

(5) Where a person convicted under this Section is a company every director and officer of the company shall be guilty of the like offence, unless he proves that the act which constituted the offence took place without his knowledge and consult.

(6) In any proceedings under this Section to which the Board is a party costs may be awarded to or against the Board.

(7) This Act applies to any article or class of articles to which it is applied by Older of the Board of Trade, being an article or class of articles declared by the Order to be one or one of a kind in common use by the public, or being material, machinery, or accessories used in the production thereof, but this Act does not apply to any articles which are from time to time declared to be controlled articles, and different provisions of this Act may be applied to different articles.

(8) The Board of Trade shall have power to require any person appearing before them under this Act to give evidence on oath, and shall have power to authorise any person to administer an oath for the purpose.

(9) In this Act the expressions "sale" and "seller" include respectively any offer for sale and any person offering to sell.

Mr. SPEAKER

The Amendment—in Sub-section (1), after the word "article"["power in respect of any article"], to insert the words "land or rent"—standing in the name of the hon. and gallant Member for Hull (Lieut.-Commander Kenworthy), and another Amendment raising the question of fixed maximum prices, were very fully discussed yesterday, and I do not propose to call upon them to-day.

Amendment made:

In Sub-section (1, b), leave out the words "hearing the parties," and insert instead thereof the words "giving the parties an opportunity of being heard."— [Sir A. Geddes.]

Sir J. BUTCHER

I beg to move, after the words last inserted, to add the words "either dismiss the complaint or."

Apparently, as the Clause now stands the Board of Trade, after hearing the complaint, can only do one of two things. They can only either declare a price which would yield a reasonable profit, or require the seller to repay the excess. It is quite clear that they ought to be able also to dismiss the complaint and make an end of it, in which case the costs would be paid by the complainant

Sir A. GEDDES

I am willing to accept this Amendment.

Amendment agreed to.

Lieut.-Commander KENWORTHY

I beg to move, at the end of Sub-section (2) to add the words "Nothing in this Section shall apply to any article for export from the United Kingdom."

I hope this Amendment will be accepted. I am sure that nothing in this Bill is intended to apply to articles for export, and in view of our well-known policy and our need, I am sure that the House will agree that we should do nothing to hamper our exports in any way.

Sir A. GEDDES

We are quite prepared to accept this Amendment, but is this the best place for it? Nothing in the Bill is intended to apply to exports, but should not the Amendment come at the end of the Bill and cover the whole of its provisions. or at the end of Clause 1?

Mr. SPEAKER

If it came at the end of the Bill it would have to be a new Clause, and we have passed that stage. It might come at the end of Clause 1. Perhaps the hon. and gallant Member will move it later on when we come to the end of Clause 1.

Lieut.-Commander KENWORTHY

Yes, with your permission.

Sir A. GEDDES

I beg to move, at the end of Sub-section (3), to add the words "except in the case of an order requiring the repayment of any amount in which case the amount shall be recoverable summarily as a civil debt."

This is an Amendment which in the course of the Committee stage we undertook to consider and to move in response to a point that was raised by the Noble Lord the Member for Hitchin (Lord R. Cecil).

Lord R. CECIL

Does this sweep out the penalty or add the other? I thought that we agreed last night to add the other and to keep the penalty alive. I should have thought that it was injudicious to do away with it. You might want the penalty as well.

Sir A. GEDDES

The actual words sweep out the penalty. I understood that was suggested and that we undertook to do it. I may, however, be wrong.

Lieut.-Commander KENWORTHY

The penalty might be very useful, and most Members who were here understood that this would be an addition to the penalty which might be imposed.

The ATTORNEY GENERAL (Sir Gordon Hewart)

My recollection agrees with that of the Noble Lord and not with that of my right hon. Friend. I think these words go too far and require some slight modification. I suggest that the Amendment should be made to read "and in case of an order requiring repayment of any amount, that amount may be recoverable summarily as a civil debt."

Mr. SPEAKER

I will put the Amendment in that form.

Question proposed, "At the end of Sub-section (3) add the words ' and in case of art order requiring repayment of any amount that amount may be recoverable summarily as a civil debt.'"

Mr. NEAL

It would make it a little clearer if, after the word "recoverable," the words "by the aggrieved person" were inserted. The order of repayment is the order of the Board of Trade, yet I respectfully suggest that it is the person overcharged who ought to have the right of bringing the action.

Sir J. BUTCHER

I think the suggestion of my hon. Friend is a right one, and that we want to give the man to whom the money is payable the right to take proceedings to recover it. Subject to that, the Amendment is a good one. I do not understand what is the meaning of the words "recoverable summarily as a civil debt." That is a new phrase to me. I quite understand a summary prosecution, font I do not understand the use of the word "summarily" in this connection.

Amendment agreed to.

Mr. JAMESON

I beg to move, in Subsection (5), to leave out the words "every director and officer of the company shall be guilty of the like offence unless he prove that the act which constituted the offence took place without his knowledge and consent." and to insert instead thereof the words the chairman and the managing director of the company shall be guilty of the offence charged unless they can show that the offence was committed without their know 'edge and consent, and any director, officer or servant of the company, on whose authority it is proved that the offence took place, shall be guilty of the like offence. Under the Clause as it stands, if the company is convicted of profiteering it follows that every director and every officer of the company is also convicted and possibly subjected to a fine and passed into gaol. The assumption underlying that is this, that once you have convicted a company of an offence it follows that every director and every official of that company is also guilty. Surely the House will see-that that does not follow at all.

Let me take a concrete instance. Suppose I go into Selfridge's shop, or the shop of some other big company, and buy a pair of socks. Like a patriotic Scotsman, having come to the conclusion that I am charged a shilling too much, I drag the company before the tribunal, and possibly before the Court, for profiteering. It is convicted. Is it to be said that every director of that company and every official of that company is also guilty ipso facto because the conviction has been obtained against the company, and are the Noble Lords and others who hold the positions of directors to be dragged away and incarcerated? That is quite un-British. It alters the whole assumption of the law of this country that a man is innocent until he is proved guilty. In my opinion the furthest you can go, if you do convict a company, is to presume that the chairman and the managing director are guilty, because they ought to know everything that is going on. Even that is a large assumption, but it is one which we are perhaps entitled to make, and I therefore suggest that in my proposed Amendment to the Clause that shall be the extent of the assumption, and that, on the other hand, the onus of proof in the case of a director or official shall lie with the prosecution, and that those persons shall be held to be innocent until they are proved to be guilty. It was pointed out last night that the term "every officer of the company" would include the secretary and the auditor. Further than that, a director of the company might be abroad at the time, and yet when he comes home he may find himself suddenly confronted by an officer of the Court, who informs him that he has been convicted of profiteering over a pair of socks, and is liable either to pay a fine or go to gaol. That is a possible result, and I submit we are entitled in this connection to contemplate all possible results. I suggest that the Clause as altered by my Amendment sufficiently meets the case. It very properly puts the onus of proof of innocence on the chairman or the managing director, but in the case of the ordinary director and ordinary officer of the company, that onus is placed on the prosecution, who must bring home guilt to these people, and in the case of servants of the company it must also be proved on whose authority they acted, as it might quite well be that the director or chairman of the company might know nothing about the price charged for the socks, and the man who was really the author of the profiteering might be the manager of the department. If that is brought home to the company's servant, then I say he ought to be held guilty. I do not think I need press this matter any further. We thrashed it out last night very thoroughly, and the Attorney-General invited us to make suggestions on this point, promising that he also would try and find a form of words which would cover the idea of the Amendment. I suggest that my proposal really meets the justice of the case.

Sir A. GEDDES

As a result of what took place in Committee last night, we also have been putting our heads together to see how we can improve this Clause. I am not sure that the Amendment moved by my hon. and gallant Friend does not practically cover the same ground as the Amendment which we intend to propose. I should like to take his second point first. Of course, I have not had an opportunity as yet of studying his Amendment. He proposes at the end of the Clause to change the terminal words from "without his knowledge and consent" into "without his knowledge or without his consent," which is a rather important point. Then, also in the earlier part, he makes the Clause read that "every director and every officer concerned in the management of the company." I am not sure, although I am very willing to consider the Clause as amended by the hon. Member, if it can be shown that it covers the point; but it does seem to me that the words which we are prepared to move at the appropriate moment wilt really meet the point, to some extent at any rate, which I undertook to cover last night. The Government proposal is to leave out the word "officer" and insert "every officer concerned in the management." and at the end of the Sub-section to leave out the words "and consent," and insert instead thereof the words "or without his consent," so that the Sub-section will read, "Every director and every officer concerned in the management of the company shall be guilty of the like offence unless he proves that the act which constituted the offence took place without his knowledge and without his consent."

Mr. KILEY

Would it not be sufficient to use the term "manager or managing director." Would not that cover the point?

Lord ROBERT CECIL

I do not want to renew the discussion of last night, but I do earnestly appeal to the Government to try and meet us on this point. The precedent which they arc establishing is really most serious. It shocks me in every fibre of my constitutional and legal feeling that you should be laying it down, even for a temporary purpose, that a whole class of people who certainly will know nothing whatever about, it—and the vast mass of the directors of companies will certainly not know anything about these transactions—that you should lay it down that this immense number of people are to be deemed primâ, facie, guilty unless they prove their innocence. That really is a most shocking proposition. While I fully admit the excellence of the intentions of my right hon. Friend, I venture to assert that if a Bolshevik Government were in power in this country all it would have to do would be to take this' Bill and make it permanent, and it would then be able to carry out almost everything the Bolsheviks are doing in Russia at the present moment, apart, of course, from actual personal violence, torture, and execution. Really, in order to meet a perfectly justifiable outcry, it is a reckless thing for the Government to establish a precedent of this kind; it is worse than any of those they have established during the War. You are to assume actually that unless persons prove their innocence they are guilty. That is what they are doing in Russia- There, if a man has a clean collar, it is at once taken to be primâ facie evidence that he is a counter-revolutionist, and he is promptly arrested and called upon to prove that he is not. That is what you are going to do here. You are going to say wherever you find a director of a company which has been guilty of profiteering that that director primâ facie must know all about it, and therefore is guilty too. You ought not to play fast and loose with an element of British justice even for the sake of passing a popular Profiteering Bill.

Sir J. BUTCHER

Surely this is only doing what is done under the Companies Act. Are you going to say that the director of a company guilty of profiteering who himself gets the benefit of that profiteering shall escape? [An HON. MEMBER: "He does not; it is the shareholders who get the benefit!"] Invariably the director is a shareholder also. I never heard of any company in which the directors held no shares. I think it would be grossly improper. My Noble Friend has probably seen the articles of companies, and I would ask him has he ever seen a case in which the directors are not holders of shares?

Mr. G. BALFOUR

I. am a director of two companies in which 1 have no personal interest, but I am qualified to act by-virtue of shares which are held in trust for the purpose of enabling me to give my services to the company.

Sir J. BUTCHER

I can only say it is rather an unfortunate position to put a director in. He is responsible to the shareholders for the proper conduct of the company, and he should have sufficient confidence in the company to hold shares in it. As a matter of fact he usually does, and I venture to say I was perfectly correct in saying that if a company makes a large profit the directors share those profits with the shareholders. And yet my Noble Friend suggests that this director is to take the benefit of the profiteering in the form of increased dividends and yet not be responsible for the offence which has been committed, unless it is possible to bring home to him definitely that he personally knew what was being done. That is a perfectly impossible position. If my Noble Friend will read the Companies Acts he will find that the companies had laid upon them an obligation to do a whole number of things. It is no good laying an obligation upon a soulless corporation or upon a thing which only exists as a legal entity. You must enforce that obligation in some way. The Companies Acts almost invariably say that if a company does not carry out the obligations imposed upon it by Statute the directors are liable.

Lord R. CECIL

Can my hon. and learned Friend give a single instance in which the Statute requires that you should send a director to prison unless you prove that he has guilty knowledge? Is there any such case in the whole extent of British law?

Sir J. BUTCHER

I did not come here prepared with my legal books, but I can say that when a company docs something through its agents which is in violation of the law, primâ facie those agents are always made responsible. That is quite a, sound principle. That is the principle embodied in this Clause. [HON. MEMBERS: "No !"] Yes, it says that the agents, namely, the directors, shall be responsible, unless they can prove they had nothing to do with it. In other words, primâ fade it is an obligation put upon them to show that for some reason they had nothing to do with it, therefore they are not responsible. In that event the Bill says they are not to be subject to any penalty. It may be only a question of enforcing payment of money which has been improperly earned by the company. I see nothing but justice in saying that if a company, a legal entity, does something, you should ask, "Who does it?" It is the agents. Prima facie the directors.

Mr. REMER

The managing director.

Sir J. BUTCHER

With great respect, no. The directors are responsible, primâfacie, as agents for the, company. If they choose to delegate their powers to the managing director and say, "We know nothing about it," they are incurring a very great risk. Surely my hon. Friends opposite must have known in their large experience of cases where companies have done certain fraudulent acts—I do not mean they know them personally, but in the course of their legal experience— through their agents, and it would be difficult for the directors to say they are not responsible unless they can prove somehow or other that those acts were done behind their backs or without their knowledge.

Lord R. CECIL

Surely even at the Chancery Bar they must have heard of the doctrine that a criminal prosecution cannot succeed unless you can prove guilty knowledge. A civil liability is a totally different matter. My hon. and learned Friend's experience relates entirely to the question of civil liability under the Companies Acts. What he says is perfectly true: the agent is liable. When it comes to putting a man in prison, the English law has laid it down broadly, with few exceptions, if there are any, that you are not to put a man in prison unless he has been personally guilty. That is the principle, and that is the meaning of the phrase which I thought would be known even at the Chancery Bar, that every man is presumed to be innocent until he is proved to be guilty.

Sir J. BUTCHER

Apparently there are some things which even the great authorities on common law are ignorant of, and amongst others they are ignorant of the provisions of the Companies Acts. There are pains and penalties put upon directors under the Companies Acts which they can only get out of by proving that they did not commit the offence. The question here is, Who committed the offence? My answer is, The agents of the company. Then the question is, What is the appropriate penalty? It may be a fine or it may be imprisonment. The directors can get out of it by saying, "We know nothing about it, therefore we have not the guilty knowledge," of which the Noble Lord speaks. Primâ facie they are responsible if an offence has been committed, and, as agents they are responsible for it. This Clause is quite reasonable. It says primâ facie you are responsible, but you can get out of that responsibility by showing that you knew nothing about it.

Mr. BRITTON

As a humble Member of this House, I have given the Government my hearty support right through this Bill, but I shall have to part company with them if, as seems probable, the President of the Board of Trade is favourably disposed to the insertion of this Amendment. If that be so, I shall be compelled, reluctantly, to vote against it. I am a director of one or two companies, but I would resign to-morrow if I thought 1 was going to be held responsible and looked upon as being guilty until I proved my innocence of some little trivial action done by people over whom I could have no direct control. The Government seem to be swinging from one. extreme to the other. Some of us, when we came here last Monday, thought the Bill was very inadequate and incomplete, and that it only touched the fringe of this great burning question of profiteering. Until the President of the Board of Trade and the Parliamentary Secretary to the Ministry of Food had given an exposition of the Bill, those were our fears and suspicions. I am satisfied now that the Bill, as it.stands, is far-reaching and comprehensive, that it ropes in all the interests and that it deals with profiteering, right from the raw material to the manufactured article on to distribution. I hope the Government will be satisfied with the powers which have been agreed to by the House without adding such an Amendment as is suggested, which in my humble Judgment is unjust and un-English. I trust that the effect of the Bill will reach one step beyond anything that has been suggested during the discussion.

Sir H. COWAN

On a point of Order. Is the hon. Member in order in referring to the Bill as a whole in speaking on this Amendment?

Mr. DEPUTY-SPEAKER (Mr. Whitley)

Hon. Members generally extend a little courtesy to a maiden speech.

Sir H. COWAN

I beg to apologise, I did not know that.

Mr. BRITTON

I very much appreciate this renewed evidence of the indulgence of this House. I do not know where I am out of order, because I want to see this Bill accomplish the purpose the Government have in view. I want them to apply it to the Government Departments. I hope they will see that the Government releases some of the vast stocks of timber, wool, and leather, on terms that cannot come within the provisions of the Bill; in other words, on. terms of reasonable and fair profit. The manufacturers and producers of this country are waiting and longing for bigger stocks of raw materials. I know producing concerns where the men are afraid to give full output because they are afraid they will work themselves out of work. I suggest to the President of the Board of Trade that he might be able to use some of his powers under this Bill to deal with Government property. Nobody wants the Government to part with its stocks without a fair and just profit. I hope that they will deal with the Government itself. My principle reason for craving the indulgence of the House is that the boot trade has come very prominently into this matter.

Mr. DEPUTY-SPEAKER

I think the more convenient occasion for the hon. Member would be the Third Reading, when he would be entitled to review the Bill. he are dealing now only with the responsibility of directors, and whether all the directors or only the managing directors should be held responsible for offences.

Mr. BRITTON

I sincerely apologise. 1 hope I may have an opportunity later of saying something upon the point.

Sir G. HEWART

As was said yesterday, we have made an endeavour and a serious endeavour to meet what was obviously the sense of the House in this matter. I cannot help flunking that there is a great deal of exaggeration upon this point. It is perfectly idle to suggest that the position of this Bill is at all analogous to the position of the person in Russia or elsewhere who is able to condemn somebody he meets in the street because he is wearing a particular kind of collar. Illustrations of that kind are obviously the merest rhetorical exaggeration. The problem with which this Clause is concerned is that of fixing responsibility in the case of that artificial person, recognised by the law, and called a company. In practice it is very difficult to bring home to the individual director knowledge of the particular transaction in which the company may be engaged. Therefore it is felt in all quarters of the House that where the offence has been committed by the company and where a conviction has followed, the guilt ought to be deemed to be brought home, in the absence of sufficient explanation to the contrary, not only to that artificial entity, the company itself, but also to some living persons who are concerned in the management of the company. The Amendment of my hon. and learned Friend manifestly fails to accomplish the purpose for which it is drafted, because, as it stands, neither of the two persons specificially mentioned in the earlier part could succeed unless both of them proved something or other. That is clearly not what is meant. I am very anxious to meet the reasonable desires of the Committee and I would go a step further than has been already suggested, and I should be prepared to move to substitute for the words in the Bill the words, "The chairman and every managing director and every officer concerned in the management." It is not that all these persons are to be guilty of the offence, but that there is to be a presumption of their guilt, which may be rebutted by proof on their part that the offence took place without their knowledge or consent. If the words are limited in that way I think the criticisms which have been made will be met.

Mr. JAMESON

I think that suggestion meets the point. It really fixes the responsibility upon the people who are primâ fame responsible, and accordingly, although it does not go quite the length 1 should like, I will withdraw my Amendment.

Amendment, by leave, withdrawn.

Sir G. HEWART

I beg to move, to leave out the words "every director and officer" and to insert instead thereof the words, "The chairman and every managing director and every officer concerned in the management."

Mr. KILEY

We are indebted to the Attorney-General for the consideration he has given to this and for his effort to meet the desire of many hon. Members who have spoken. The suggestion, however, does not completely meet our views. I am chairman of a company and I spend a good part of my time in the establishment. Whilst I am absent, there is a managing director who is carrying on the business. He has under his control a number of departmental managers who fix prices for their goods. They are expected to make a gross profit on the total turnover, on some articles 8 per cent, and on others of a perishable nature, more. It is not possible for me to be cognisant of every variation of price that goes on in every department of the stores. If the Attorney-General would alter the wording and make It "Chairman or managing director." that would give him all he. wants. He wants to get someone in a responsible position. I do not think he wants all the staff. He wants the manager of the department concerned, but he does not want every manager. If one manager out of twenty commits an offence, you do not want the other nineteen who have nothing to do with the department which is affected. Therefore, I suggest that the right hon. Gentleman should alter the wording, and restrict his efforts to the chairman and the managing director.

Lord H. CECIL

I cannot help feeling that this Sub-section is open to this very important criticism—that either it will be so administered that it will not produce any particular effect, or it may be an instrument of prodigious injustice. It is actually proposed that the managing director, the chairman, and any officer concerned in the management are to be convicted, unless they can prove that they have no knowledge of the offence, and the offence is to be the exceedingly vague offence that it is whatever a Court of Summary Jurisdiction thinks unreasonable. So that we are actually going to propose that a person may be sent to prison because he cannot prove that he did not know that someone in his employment was going to charge a price which, ex post facto, a Court of Summary Jurisdiction finds to be an unreasonable price. If such a proposal is to be taken seriously, if it is not to be thought a rather tedious addition to Alice in Wonderland, it would undoubtedly be a most iniquitous and oppressive proposal. If this were to be part of the permanent law of the land, no one would ever become a managing director. Some evasion probably would gradually grow up, and there would be a young man of no particular character, who did not mind going to prison, who would nominally hold the post of managing director, and when a prosecution took place he would go to prison. The history of oppression is full of episodes of that kind. These presumptions of guilt are an old story. I remember in mediaeval times the question was asked, "Can an archdeacon be saved?" the presumption being that he could not be saved. The Bill will only last for six months, and probably will produce no effect whatever, and if that were all it would not be worth while protesting, but it is important as setting such a dangerous precedent. Any Government, in a moment of panic or in a state of public excitement, can propound a vague offence., like charging a price which someone or other is going to think unreasonable—you could not have a vaguer offence than that —and then proposes to send people to prison—or why not put them to death, as the injustice is exactly the same in essence, though not in degree—because they could not prove that they had not knowledge that someone in their employment had committed an offence of the very vaguest character. That is a very dangerous precedent to set, and it is an illustration of what a bad plan it is to bring in legislation in a hurry and sit all night considering the details of it. The Attorney-General just now spoke of the sense of the Committee. Can a Committee be said to have any sense if it sits up all night?

Mr. DEPUTY-SPEAKER

It is contrary to the Rules of Order to speak disrespectfully of the Committee of the House.

Lord H. CECIL

I am aware that, except, in a spirit of mockery, such an ex-pression should not be used. It certainly is an additionally dangerous precedent it you are going to do these very drastic things in criminal law without the ordinary safeguards. The Bill has still some stages to pass in another place, and I earnestly hope the Government will reconsider the precedent they are setting in this Clause, and will see that the ordinary safeguards of the liberty of the subject are put into it.

Mr. G. BALFOUR

I should not have said a word but for the speech of the hon. Baronet (Sir J. Butcher). He said he could not conceive that any director of any company would not have full knowledge, and would not accept full responsibility for the whole of the actions of the company. There are many cases in which directors have no financial interest in the company, but have been invited to join the board because the company was in great difficulty, and they gave their services in order to get it out of the difficulty, and had no further concern with the results of the trading.

Mr. DEPUTY-SPEAKER

That controversy was on the Amendment which is now withdrawn. We must really keep ourselves now to the new words which are suggested, confining the liability to the chairman, managing director, and every officer concerned in the management. It is a more limited question now than it was before.

6.0 P.M.

Mr. BALFOUR

In certain cases, managing directors have been appointed to assume very great responsibilities in companies with which I have no association in business, such as soft goods and grocery stores. Quite recently a very large stores in London invited very responsible gentlemen to accept seats on the board, and in one case, I think, to accept the chairmanship and the managing directorship of the company, in order to rescue it from a serious financial position. There are many hundreds of companies with directors on the board, men of the highest standing and repute, who have been asked to join the board in varying capacities, as chairman, managing director, or otherwise, in order to save the companies and enable them to conduct their business on proper lines. It is proposed under this Clause that the prices of articles are fixed with the full knowledge of the chairman or managing director, and he is to be liable to go to gaol or to suffer the imposition of a very heavy fine unless he is able to go into Court and prove that he is innocent. It is an entire perversion of every elementary rule of British justice which has obtained in this country up to the present. I beg the right hon. Gentleman in charge of the Bill to consider that point of view. I certainly would not waste one moment in speaking on this matter if I thought it was a mere trivial incident in the Bill, if I thought it was something which would not be pointed to in after years, when this six months has elapsed, as a precedent established, not. by a party Government, but by the considered judgment of a Coalition House of Commons. This will be thrown up to us in. after years constantly, and I beg and implore the right hon. Gentleman in charge of the Bill to consider that point If he would only slightly modify the Amendment and put in every person directly responsible for fixing the price of the goods, it would cover the whole thing. It would get the chairman, if he is responsible, it would get the managing director, it would get the officer, it would get the servant, it would get the man you want. It would make the net wide enough to get everybody without putting an unfair penalty upon anybody.

Mr. JAMESON

I withdrew my Amendment, and the question before the House is whether the Attorney-General's Amendment should take the place of the words in the Bill at present. So far as the people for whom I am speaking are concerned, I very much prefer the Amendment of the Attorney-General to the words that stand in the Bill, and I hope hon. Members will not oppose the Attorney-General's Amendment.

Sir A. S. BENN

This Amendment settles the point which worried many of us last night.

Mr. M'LAREN

I had no intention of taking part in the discussion, but certain things have been said which make it incumbent upon me to speak. The new Amendment gives power to the Government to penalise a director unless he can prove that he is not guilty. In connection with the law, the common criminal is held to be innocent until the Government or the authorities prove him guilty.

Mr. DEPUTY-SPEAKER

I would point out to the hon. Member that Standing Order 19 prevents an hon. Member repeating speeches already delivered.

Mr. M'LAREN

It is no new precedent that this is to put into operation in the law. In connection with the Mines Act of 1911, a managing director or a manager or chairman of a company can be taken up, and have been taken up, for an offence against the Mines Act of 1911, and they had to prove that they were innocent before they were let off. I have always thought that it is a great mistake that a man should be called up and that he should have to prove his innocence before he is let off. It is incumbent upon the Government to prove the opposite. While I recognise that a good deal has been done to meet the wishes of the House, I think the Government might go a little further and eliminate that portion of the Amendment.

Mr. J. DENNIS

I should like to support what was said by my hon. Friend (Mr. Kiley). I do so feelingly, because I am chairman of at least two companies in which I am in no way pecuniarily interested so far as the trading results of those companies are concerned. I do not receive one penny by the way of fees or emoluments. My position appears to be this, that if any official of either of those companies brings himself within the terms of this Bill and commits an offence which is not defined, and in regard to which I should have no guide, I might find myself hailed before a Court of Summary Jurisdiction, and only then for the first time be able to place before the Court any excuse which I might offer, and I presume that excuse would have to be given from the (Jock. Therefore, T speak feelingly upon this matter, and I hope the Attorney-General and the President of the Board of Trade will see their way clear to fall in with the views of my hon. Friend (Mr. Kiley) and fix the responsibility for the offence upon such officer, be he chairman, managing director, or other official, upon whom the responsibility rests.

Amendment agreed to.

Further Amendment made: In Sub-section (5), leave out the words "and consent," and insert instead thereof the words "or without his consent."—[Sir A. Geddes.]

The following Amendment stood on the Paper in the name of Mr. GRIFFITHS— leave out Sub-section (7).

Mr. GRIFFITHS

My object in putting down this Amendment is to get information, and before I move it I should like to ask the President of the Board of Trade whether bricks, cement and timber are within the scope of this Bill?

Sir A. GEDDES

Yes.

Mr. GRIFFITHS

Then I do not move the Amendment.

Mr. PENNEFATHER

I beg to move, in Sub-section (7), after the word "articles"["any articles"], to insert the words "sold at public auction or by competitive tender or."

I imagine that the Government do not intend that this should apply to articles sold by auction or by competitive tender, because the conditions of sale by auction or by tender are totally different from the conditions of sale which can be considered in this Bill. When an article is sold at public auction it is not the seller but the buyer who fixes the price, by his own bid. Consequently, when the buyer has himself fixed the price which he is willing to pay it would be absurd to suggest that he should then lodge a complaint that the price was unreasonably high. The same thing, although somewhat differently, applies to articles sold by competitive tender. It is true in that case that the tenderer does name a price but it is the prospective buyer, the man who invited the tender, who names the conditions, and the conditions are very frequently onerous and almost invariably include penalties. When the tender has been sent in the prospective purchaser is nearly always protected by a clause that he is not bound to accept the lowest tender. Therefore, he can voluntarily, and he does so in a great many cases, accept a price which is higher than the price at which he could have bought elsewhere. For his own reasons he voluntarily elects to pay that higher price. In that case it would be ridiculous for him, when he had accepted the tender at a higher price than other prices submitted to him, to turn round and say, "This is above the market price, the price is unreasonable." I hope the Government will see that it is only reasonable that some such words as these are inserted, to make the meaning quite clear.

Lieut-Commander KENWORTHY

I beg to second the Amendment.

Sir A. GEDDES

I will accept it.

Amendment agreed to.

Mr. HOLMES

I beg to move, in Subsection (7), after the word "articles"["controlled articles"], to insert the words "nor to the sale of any article for export from the United Kingdom."

I hope this will meet with the approval of the House, and I understand the Government will accept it. We want to prevent' the people of this country paying unduly high prices, but we are prepared to sell our goods abroad for the best price we can get. The rule of the nation, of course, is that the buyer imports as cheaply as possible, but we sell our exports as well as possible. It is in order to protect anyone who is exporting from having to reduce their prices under this Act, that 1 move this Amendment.

Lieut.-Commander KENWORTHY

I beg to second the Amendment.

Sir A. GEDDES

If the hon. Member will move this as a new Sub-section (10) in these words, "Nothing in this Act shall apply to the sale of any article for export from the United Kingdom," I will accept it.

Mr. HOLMES

I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. HOLMES

I beg to move, to insert as a new Sub-section, (10). Nothing in this Act shall apply to the sale of any article for export from the United Kingdom.

Lieut.-Commander KENWORTHY

In the absence of my hon. Friend (Mr. Holmes) I moved this Amendment earlier, and it was accepted by the right hon. Gentleman, who said that it should come as a declaratory proviso at the end of the Bill.

Sir A. GEDDES

The hon. Member was mistaken. It was to come at the end of Clause 1.

Lieut. - Commander KENWORTHY

The words have been slightly altered. It says, "Nothing in this Act." Does that mean that we cannot investigate the proceedings of companies that go in for export? Goods are exported to some other country and then are brought back again in order to evade some Regulation of the Board of Trade with regard to fixing prices, or they might be sent abroad for some finishing touches; and these words "Nothing in this Act" seem to me to leave that loophole, but perhaps an explanation might clear that matter up.

Sir A. GEDDES

The words are, "The sale of any article for export."

Amendment agreed to.

Lieut.-Commander KENWORTHY

I beg to move, at the end of Sub-section (4), to insert the words The Board of Trade may, when they think the circumstances of the case so require, take proceedings against any person making a involous or malicious complaint before a Court of Summary Jurisdiction, and if in such proceedings it is found that the complaint made was frivolous or malicious he shall be liable on summary conviction to a fine not exceeding two hundred pounds or imprisonment for a term not exceeding six months. I had in mind the case of a trade rival who deliberately brings a charge against Another tradesman in the town in order to discredit him in the district, and if this can be proved it should be possible to make it an offence punishable. Tradesmen will require protection from purely malicious proceedings. Several speakers of great experience in commerce, speaking early this morning, referred to the case of the refusal of credit through the complaint of some unprincipled person, and in the case where there is a complaint against a respectable, honest business man there should be a deterrent.

Major HENDERSON

I beg to second the Amendment.

Sir G. HEWART

This Amendment exhibits a somewhat unusual degree of misconception of the provisions of the Bill. The Amendment is that the Board of Trade may take proceedings against a person who makes a frivolous or a malicious complaint before a Court of Summary Jurisdiction. But the persons to take proceedings against a Court of Summary Jurisdiction are the Board of Trade themselves or a committee to which they delegate their powers. Therefore it is asked that the Board of Trade, having commenced proceedings before a Court of Summary Jurisdiction, should afterwards commence proceedings against themselves. If that is not what the Amendment means, and if the person to be hit by the Amendment is not the person who is responsible for the proceedings before a Court of Summary Jurisdiction, but the person who makes some complaint of a malicious and false description, that is dealt with by Sub-clause 4 of Clause 1, which provides: If any person at or for the purpose of any such investigation or in any such complaint furnishes any information or makes any representation which is recklessly or to his knowledge false in any material particular, he shall be liable on summary conviction to a fine not exceeding fifty pounds or to imprisonment for a term not exceeding three months, or to both such imprisonment and fine.

Lieut.-Commander KENWORTHY

I had not seen the newly-drafted Sub-clause. I think that the Attorney-General will agree that the Bill has been altered a great deal since it was first introduced and that this Amendment was an original Amendment to the Bill in its first form, but after the explanation which has been given I shall be glad to withdraw it.

Amendment, by leave, withdrawn.