HC Deb 01 July 1927 vol 208 cc814-5

Amendment made: In page 8, line 25, after the word "delivered," insert the words "or sent."—[Mr. Dennison.]

Mr. SOMERVILLE

I beg to move, in page 8, line 25, to leave out the words "within seven days," and to insert instead thereof the words "at the time."

2.0 p.m.

In the unfortunate absence of the other supporters of this Amendment, it falls to me to move it. The fact that the other supporters of the Amendment are lawyers affords some reason for believing that it rests on a sound legal foundation. The object is that the carrying out of the transaction should follow the ordinary course of business, and that, at the time the contract is made, both the borrower and the lender should have a signed copy of the agreement. The Bill as it stands provides that the agreement shall be handed over with seven days, but it seems safer, and more in accordance with the ordinary course of business, that the agreement should be handed over at the moment when it is made and signed. One can easily imagine that an untrustworthy lender, dealing with a weak or credulous borrower, might take advantage of the interval to attempt to tamper with the agreement, and introduce terms more favourable to himself. I hope that my hon. Friend in charge of the Bill will accept the Amendment.

Lieut.-Colonel HENEAGE

I beg to second the Amendment.

This Amendment proposes that the note or memorandum containing the terms of the contract shall be signed and delivered to the borrower at the time, and, in accordance with the provisions of this Clause, it will have to contain a statement of the rate per cent. per annum of interest charged; and the circular referred to in Clause 4 has also to show, in somewhat similar terms, the rate per cent. per annum. The drafting of the Bill has been such as to ensure, as far as possible, that the borrower knows exactly what is the rate per cent. per annum charged, and the suggestion of this Amendment is that the agreement containing this and the other particulars shall be handed over at the time it is made, instead of waiting for seven days.

Commodore KING

These words that it is now sought to introduce were deleted in Committee. The Bill, as originally drafted, had these words, "at the time," but after careful consideration the words "within seven days" were substituted. The point raised by the Amendment is that the borrower should know at the time the exact conditions of the contract into which he is entering. If the loan is at a fixed rate of interest he is aware of that when the contract is entered into, because he and everyone to be charged under the contract has personally to sign the contract. Where the loan is not at a stated rate of interest it is already laid down that before the contract is signed the actual rate per cent. per annum involved in the repayment has to be given to the borrower in writing. Therefore his position is well assured. The reason for giving seven days is that many of these transactions are carried out through the post, and while the contract itself may be completed by the signing of the document by all persons who are going to be charged, it seems reasonable that a few days may be allowed for the sending of the copy of the agreement to the borrower, he being, at the time when he enters into the contract, in full knowledge as to what the terms are. After the discussion we had upstairs, I think it is better to leave the Bill as it stands.

Amendment negatived.