LAW CHARGES. (Hansard, 24 February 1931)

§ Mr. PETHICK - LAWRENCE
This Vote arises from the cost of litigation concerned with de-rating appeals, which is heavier than was anticipated. The De-rating Act provided for appeals from the decision of assessment committees to Quarter Sessions. The decisions of the latter are subject to review by the Divisional Court, the Court of Appeal, and, ultimately, the House of Lords, and the expenditure on these appeals proved more heavy than was expected when the Estimate was taken, and on that account some additional £22,000 is required. But 2054 against that there has been a certain saving by means of additional Appropriations-in-Aid in connection with criminal prosecutions which has amounted to something like £16,000. This necessitates us asking for this Vote for a sum of £6,000.

§ Mr. ARTHUR MICHAEL SAMUEL
I see in the Appropriation-in-Aid an item of £4,500 under Letter I for the Crown Nominees Costs.

§ The CHAIRMAN
The hon. Gentleman has the Estimate in his hand, and he will see what the £6,000 is for. £22,000 is for civil proceedings and there is an appropriation of £16,000. That is all that we have to deal with.

§ Mr. SAMUEL
I see in the original and revised Estimates sums of £32,000 and £48,000.

§ The CHAIRMAN
In any case, with reference to Appropriations-in-Aid, he can only ask how they are made up, but the explanation given in the details of the Estimate seems to me to give the answer the hon. Gentleman requires.

§ Mr. SAMUEL
I propose to ask how they have been saved. Will the Law 2055 Officers tell me how they have saved that £16,000. Also, perhaps, they will tell us in detail what makes up the £22,000. Is it the fees of the Law Officers? I do not want to touch on delicate ground, but how is the amount arrived at which makes the additional sum required under letter E?

§ The ATTORNEY - GENERAL (Sir William Jowitt)
The £22,000 represents costs for solicitors' fees, counsels' fees, etc., in respect of de-rating matters. I cannot split the sum up, but the position is simply that the amount exceeds what it was estimated would be incurred by this sum of £22,000. So far as the Appropriations-in-Aid are concerned, that simply results in this way. When the Crown is successful in litigation, it is entitled to recover from the unsuccessful litigants costs in the ordinary way, and the costs which have been recovered exceed the estimate of the costs that were expected to be recovered by £16,000. On the one hand, we are down by £22,000, and on the other we are up by £16,000.

§ Sir BOYD MERRIMAN
Are the costs recovered mostly in de-rating cases?

§ The ATTORNEY-GENERAL
Largely. First of all £2,000 was paid in connection with some litigation with the London and North Eastern Railway Company and £1,200 in respect of another matter.

§ Mr. BATEY
Can the Financial Secretary tell us in connection with the De-rating Act whether the expenditure was worth while?

§ The CHAIRMAN
I am afraid that if the hon. Member were allowed to ask the question, and I was perhaps careless enough to allow it to be answered, it would open up a wide discussion. It does not arise on this Vote.

§ Mr. BATEY
There is another point I should like to raise, seeing that it is a legal Estimate. I should like to know whether I might be allowed to raise the question of working men magistrates.

§ The CHAIRMAN
I am afraid the hon. Member has not studied the Supplementary Estimate. If he had, he would not have raised such a question.

§ Sir GEORGE PENNY
We are obliged to the Attorney-General for telling us about the additional sum required in 2056 respect of de-rating matters. Seeing that the sum is £22,000–66 per cent. of the estimated figure—I think we should have a more detailed account of how it is arrived at.

§ The ATTORNEY-GENERAL
In the English Courts unfortunately we do not follow the Scottish practice. In Scotland you merely go before the assessment committee, there is one appeal to the Land Valuation Court, and that ends the matter. In the Courts of England you go, first of all, before the assessment committee, then to Quarter Sessions, then to the Divisional Court, then to the Court of Appeal, and finally to the Rouse of Lords. Owing to the fact that this was a new Act, there has been the most remarkable difference of opinion between the Courts of Scotland and those of England, and between all the Courts in England. The hon. Gentleman would perhaps like to know the number of appeals that have been lodged with Quarter Sessions. It is 1,849, of which 1,593 were as to whether the hereditaments in question were or were not entitled to de-rating, and 256 were on the question of value only. They all concerned collieries, with regard to which very difficult questions arose. The majority of the 1,593 appeals were brought by the Revenue Officer to Quarter Sessions. The cases that have now been disposed of number 1,081; 641 have been decided in favour of the Revenue Officer, and 400 against him, so that we have a very considerable balance there.
We take the cases, and we select, as far as we can to bring to the Courts test cases—as, of course, we could not bring anything like that number—representative of the variety of cases up and down the country. The Divisional Courts took a view which was in our favour on the whole. We won 32 cases and lost 25, and we have awaiting hearing somewhere about 40 to 50 cases. The Court of Appeal, however, reversed the decision of the Divisional Courts, taking a different view in the large majority of cases. In the Court of Appeal we won two and lost 15 cases. Those 15 cases have been almost all cases in which the Court of Appeal have taken a different view from the Judges of the Divisional Court who heard the cases. We have appealed to the Rouse of Lords, and only two cases have been disposed of—the first two main cases—and they 2057 have been lost. But eight cases have been heard and are now awaiting decision. Of course, it would be disrespectful of me to say what I think the result is going to be, but perhaps, without any disrespect, I may say that from the indications I had during the course of the arguments, I am very hopeful their Lordships will take a view, in a considerable number of cases, which is favourable to our line and that they are going to reverse the Court of Appeal. Of course, I cannot say more than that, as hon. Members will realise.

§ Mr. ALBERY
Taking the cases the Attorney-General has brought altogether, and the cases which have been decided against him in the first Court and subsequently in the second, can he give us the figures of the present results?

§ The ATTORNEY-GENERAL
I gave the figures in the Divisional Courts—32 cases won, 25 cases lost and 50 cases, I think, awaiting hearing. As far as the Court of Appeal is concerned, two cases were won and 15 cases lost. As far as the House of Lords are concerned, the two cases which have been heard, and in which judgment has been given, were lost. There are eight cases now awaiting judgment, and it was with regard to those cases that my remarks of great hopes were expressed. That, I think, is the correct position.

§ Sir G. PENNY
The Committee, I think, are very much indebted to the learned Attorney-General for the very full statement he has made to us. In regard to the cases where he said the Crown has, in the majority of cases, been successful in the appeals which have been made, I should like to know whether the Law Officers of the Crown presented those cases personally before the court, and, if so, can he tell us the fees which these representatives entailed to the country and whether they were included in the additional sum required?

§ The ATTORNEY-GENERAL
I am afraid I cannot state particular fees. They have not been fixed as yet, but the whole thing is included in the £22,000. In view of the importance of these cases—they almost all govern a large block of cases—the hon. Member will see that I felt it necessary myself to present them.

§ Sir A. LAMBERT WARD
I am not a lawyer, and, therefore, I should be hopelessly outclassed in attempting to debate a question like this with the hon. and learned Gentleman, but I am sure he will be kind to me and answer a question which I wish to put for the purpose of obtaining information. I want to know who is responsible for the final decision as to whether a case is to be fought or not, and who is responsible for the final decision as to whether a case is to be taken to the Court of Appeal and to the House of Lords? Has the hon. and learned Gentleman the final say in the matter? If he has, if I may say so without any disrespect, I do not think that he has shown the consideration which one might hope the Law Officers of the Crown might have displayed.

§ The ATTORNEY - GENERAL
Of course, the sole responsibility rests upon me, but in practice the hon. and gallant Member will realise that I am advised. I do not shelter behind anybody else. The tasks of this sort which I have to do are so multifarious that it is hardly possible for me to bring my mind to bear upon any particular case. In practice, what would happen would be, that the Solicitor to the Treasury or the very experienced Junior Treasury Counsel would say, "We have such and such a case, and I think that it ought to go up." If they are in doubt with regard to a particular case they come to me. Where they told me that it was clear I should not think of going into the facts. I should accept their opinion. I think that it is desirable to have decisions in cases of complexity and difficulty where the Scottish courts differ from the English courts. It was very undesirable that we should have derating extended to places in Scotland. or vice versa, and not to places in England under the same Act. Therefore, wherever I found a case of importance where there was a difference between the English courts and the Scottish courts, I thought it right to take the case up.

§ Sir A. LAMBERT WARD
I am very much obliged to the Attorney-General for the kind way in which he has answered my question.

§ Mr. TURTON
I would remind the Committee that when the Supplementary 2059 Estimate was brought in last year, the amount was £12,000. This year the extra expenditure involved is £22,000, and if we have a Socialist Government next year it will be £32,000 at that rate of progression. The point to which I really want to draw the attention of the learned Attorney-General is the way in which his Department have conducted the appeals under the Rating and Valuation Act. In the present economic crisis we ought to practise the greatest economy possible, and for that reason these appeals ought to be carried out in an economic manner. I am not talking about the appeals in town. The Attorney-General, quite rightly, takes those cases himself. But in regard to appeals in the country, a junior counsel is sent from London to argue the cases. Therefore, the country will have to pay not only for his very great skill in arguing the cases, but a considerable cost in railway fares and also incidental costs which are entailed owing to the etiquette of the legal profession.
If the learned Attorney-General will bear with me, I will put forward a hypothetical appeal case, say, at Newcastle. If there is a de-rating case at Newcastle the Attorney-General will send up revenue counsel from London, and the cost in railway fares alone will be £5. If the case is at a closed session, as they all are, he will have to pay, in addition, a special fee to that revenue counsel. If that counsel, as is nearly always the case, is not a member of that circuit, the Attorney-General is obliged to employ another junior counsel to assist in the case. I speak with diffidence, because I am a member of the same profession. The difficulty with me is to reconcile my duty to my profession and my duty to my constituents as regards economy.
I am, however, certain that we could have conducted these appeals in a more economical manner. At Newcastle there is a local Bar, and while I would not in any way underrate the abilities of the admirable young counsel sent by the Attorney-General to Newcastle, I would point out that there are in Newcastle as competent men to argue the case as those sent up from London at such expense. [Interruption.] I believe the hon. Member who interrupted me does 2060 not come from Newcastle, but from Durham, which has not a local Bar. I suggest to the Attorney-General that from now, in face of the grave economic crisis, when any further de-rating appeals are brought forward they should be conducted either by barristers practising upon the circuit or in the most economical manner by members of the local Bar in the various industrial towns where the cases are heard.
I come to the question of appeals from decisions of the Courts of Quarter Sessions. Last year we had a discussion upon this point. The Attorney-General has given us a recital of the appeals and the result of the appeals. When I heard his recital I visualised how in one part of the battle he had won and in another part his enemies, the derating hereditaments, had gained a minor advantage. All the way through I asked myself who, really, had been wounded. If the Attorney-General won, then the poor industry concerned, the coal industry or the de-rated textile industry, had to pay the costs. The Financial Secretary to the Treasury spoke with great joy of the sum of £16,000 Appropriation-in-Aid which had been recovered from the would-be de-rated industries that could not be de-rated. When the Attorney-General lost, then the taxpayer had to pay.
We are not getting great advantage by having these costly and numerous appeals from the Courts of Quarter Session right up to the House of Lords. Last year a point was made that these cases need not be taken up to the Appeal Court. The hon. Member for Bridgwater said that it was quite unnecessary to employ revenue counsel in these cases, or to take them up to the Appeal Court. He said that it was merely a question of fact. The Attorney-General is an acknowledged authority on the splitting of questions of fact from questions of law. We have had considerable experience upstairs in another committee of his great skill in splitting the hair that lies between a question of fact and a question of law. He replied last year that it was impossible to say in these cases that they were purely questions of fact, but I would point out that in the two cases that the House of Lords have decided they decided that it was purely a question of fact for the court of first instance to determine.

§ The ATTORNEY-GENERAL
That is not right. In the last eight cases they have said specifically that it is not a question of fact. Of course, the hon. Member could not know that, but he can take it from me that they expressed their dissent from the view expressed by one of the Judges in the Court of Appeal that it was a question of fact.

§ Mr. TURTON
I accept that statement, because I could not possibly know what has happened in the eight cases. I have no intention of delving into the minds of House of Lords, but I do hope that we shall not have so many of these de-rating cases. It is a very large sum to ask the House to vote £22,000. That is the sum which has been spent in extra law charges under this one Act. I agree that it is an important Act and that we should select a few cases in order that certain points may be determined, but I do not agree with the Attorney-General that we have selected as few as we might have done. Take the garage cases. He selected three cases, all of which appeared to bear on the one point as to whether the garage was or was not an industrial hereditament. We could have had one case to decide that question and could have spared the expenditure of public money and also the expenditure of the private money of the owners of these small industrial hereditaments. The Attorney-General has told us that there have been 1,081 appeals on this one question, and we are still throwing our money away and continuing these appeals through the various courts up to the House of Lords. I do ask the Attorney-General that during the coming year he should try to keep down the appeals under the Rating and Valuation Act.

§ Mr. HARDIE
In listening to the hon. Member who has just resumed his seat one would think that the present Government are responsible for the Act under which these appeals have been taken. He seems to forget that all the difficulties of which he has been speaking and all this stupid expenditure is due to the fact that a Conservative Government passed a De-rating Act. I am surprised that anyone with any knowledge of law should have spoken as the hon. Member did on that point. Much is said about economy by hon. Members opposite, but in their eagerness they forget the cause of the expenditure. The hon. Member pointed 2062 out that last year we had £12,000 to pay and that this year the amount is £22,000. All this expenditure has been caused by points of stupidity raised by the law called the De-rating Act. That Act could not be put upon the Statute Book without containing all this stupidity on what are said to be questions of law. We were told that that Act would wipe out unemployment and do ever so much for industry, but the only industry that is improving under it is the law industry, if that can be called an industry. There has been an expenditure of £22,000 this year in law charges under the Act, and there are cases pending. When these cases are finished we are only at the beginning in regard to these so-called points of law. In the Scottish courts and in the English courts cases are going on. There is hair splitting as to the difference between law and fact. Gentlemen are receiving fees for pointing out where the hair is, but it is not good for the business of this country and it is useless expenditure. Can the Attorney-General tell us why the Estimate which was £12,000 last year is £22,000 this year, and the amount in which we are likely to be mulcted before we have finished?

§ The ATTORNEY-GENERAL
As we have to take these cases to the House of Lords in order to get definite principles established we have to pay through the nose, but these principles of law have to be dealt with and there is no finality until you get that tribunal because there is a difference between England and Scotland. The trouble with regard to the garage cases was that the garage proprietors declined to agree a test case, and consequently we had to go three times instead of once.

§ Major ELLIOT
The hon. Member for Springburn (Mr. Hardie) seems to think that this Estimate indicates a lack of prevision in the authors of the De-rating Act. Surely he is not ignorant of the fact that he and his friends declared that the De-rating Act would be totally unworkable, but we find that it has come into operation with the comparatively small difference indicated in the Estimate of the Law Officers of the Crown. Everyone knows that it has worked successfully, and, indeed, so successfully that the President of the Board of Trade in connection with the Coal Mines Act said that 2063 the whole of the money he proposed to give in relief to the coal industry was derived from the Tory De-rating Act.

§ Mr. BATEY
May I be allowed to come in now?

§ Major ELLIOT
The hon. Member will have an opportunity of making his point. I am quoting the remarks of his own Minister at the Board of Trade. If the hon. Member proposes to disown his own Minister it is not a new thing, so far as a Socialist Government is concerned; indeed, it is the normal procedure. All the facts show that the De-rating Act is being administered with a minimum of trouble.

§ Mr. HARDIE
How is it that under the De-rating Act the arrangements for the allocation of counsel in Lanarkshire is still unsettled?

§ The CHAIRMAN
We cannot go into these details of the administration of the De-rating Act on this Estimate.

§ Major ELLIOT
The Attorney-General may have called an unnecessary number of cases; I am not concerned with that. He is the responsible Law Officer and must be the best judge in these matters, and also as to the way of approaching finality. The House of Lords has given a series of rulings which it has been found possible to apply generally to the country. I am pointing out that the hon. Member for Springburn and his friends vehemently disclaimed against the whole ideas upon which the Act was based and said that they would immediately repeal it when they came into office.

§ The CHAIRMAN
We cannot discuss the merits of the De-rating Act now.

§ Major ELLIOT
I do not wish to go into the merits of the Act, but as this expenditure arises out of it it follows that if it had been repealed none of this expenditure would have arisen. Hon. Members opposite did not repeal the De-rating Act because they thought it was a useful Measure and because they were frightened. The fact of the matter is that they are able to work the Act and derive great benefit from it. They themselves are the chief defenders of the Measure—

§ The CHAIRMAN
The only question raised by hon. Members on the Government side of the House was that as a result of this Act this expenditure has occurred and that statement does not entitle the hon. and gallant Member to go into the merits of the De-rating Act.

§ Major ELLIOT
The speech of the hon. Member for Springburn was entirely devoted to a denigration of the De-rating Act, and I was only replying to him. For myself, I am in accord with the Attorney-General. I do not think this is an excessive Estimate having in mind the enormous sums affected. The principles of the Act are being adjudicated upon, the Measure is being brought into action, and I am heartily in accord with the Attorney-General in asking for this Estimate and I shall be prepared to support him in the Division Lobby.

§ Mr. BUCHANAN
I imagine that I should be out of order if I raised those points which I desire to raise upon this Vote. There is the question of the allocation of counsel. Part of this £22,000 is to be paid to counsel employed in various parts of the country. I do not wish to challenge now the present method of allocating counsel, but I am not sure how far the question of patronage enters into the employment of counsel. I feel sure that patronage does exist, that friendship does exist and does, apart from capacity and other considerations, enter into the make up of these Estimates. If I went into the broad question I should probably be out of order, but there is no doubt non counsel has been employed when local counsel could have been secured in the area where the case arose instead of sending up a man to conduct the case. Some big principle might involve the employment of a fashionable lawyer. [An HON. MEMBER: "Who is he?"] The high-priced lawyer—if we were discussing football it would be the Hughie Gallachers of the profession, the high priced players. I think the State should employ local men when no great principle is involved. They could be engaged at less expense. I hope on a future occasion to raise the general question of the employment of counsel and the growing system of patronage in connection with this work.
2065 As regards the remarks of the hon. and gallant Member for Kelvingrove (Major Elliot) as to the smooth working of the Derating Act, may I suggest that it has worked so smoothly that there are now 2,500,000 unemployed as against 1,000,000 before it came into operation. He said that we had not repealed that Act, but neither did his party repeal the Wheatley Act, so I think that we are quits in that respect. I view with apprehension the increase in expenditure under this head. I think much of it might have been avoided by employment of local counsel, and I hope that the system of appointing, not only counsel but judges and semi-judges throughout the country will be faced by the House of Commons and thrashed out on some future occasion.

§ Mr. ALBERY
The detailed figures given by the Attorney-General seem to a layman to disclose a rather serious state of affairs as regards public litigation. I gather that of the cases appealed, some 15 went against the Department and only two were in favour of the Department. Taking the cases brought in the first court in which there were appeals against the Department it would appear that the Department were losers in about eight and winners in about seven. In ordinary circumstances that would be a very alarming state of things. The Attorney-General however explained that he had to bring a great number of these cases in order to settle certain questions of law. I was therefore disappointed at his reply to the question addressed to him just now by an hon. Member opposite as to whether there was any likelihood of a reduction in the number of these cases in the future. The Attorney-General seemed to be unable to give a satisfactory reply but, surely, since so many cases have been brought to determine points of law, we should be able to look for a substantial reduction in the future.

§ Mr. DIXEY
It seems very serious that this extra sum should be required under this head, inasmuch as everybody who has had anything to do with Government litigation knows that the costs in these cases do not follow the ordinary course of practice, and that in many cases of appeals against the Government costs are given to the Government even though 2066 the appellant is successful. It is also extraordinary that this additional Estimate should be required having regard to the fact that so much of this litigation is only undertaken after the expert opinion of the Law Officers of the Crown have been taken upon it. I do not know why, at this juncture, we should be called upon to vote such a large additional sum in this respect. I had not the privilege of hearing the Attorney-General's speech but I hope I may be allowed to put forward certain points. Speaking for the lower branch of the legal profession it seems to us that a large number of appeal cases are carried forward by the Government without any proper reason or justification for the expense incurred.
We are told that in a large number of these cases questions of principle are involved. I do not know what the principle involved may be in any particular case, but, no doubt, the Treasury has the thick end of the stick and a number of unfortunate people who are concerned in this litigation are compelled to consider whether or not they can afford to fight the Treasury, even in cases where they are sure of their facts. They know that the Treasury have the power of money behind them, and I suggest that a number of these cases are taken to the Appeal Court without real justification in law. I am not suggesting that this remark applies only to the Department as run by the Attorney-General. I suggest that this procedure has been going on for a number of years, and that in many cases the humble appellant is compelled to make a settlement because he knows that the full force of the Treasury is against him. I heard with great interest the hon. Member for Gorbals (Mr. Buchanan) who made a very proper complaint in regard to the employment of counsel.

§ The CHAIRMAN
I am sorry that the hon. Member was not here earlier in this discussion, otherwise he would know that we are having the same arguments repeated over and over again. There is a rule against repetition, and the hon. Member for Gorbals (Mr. Buchanan) was not the first to raise that point. The hon. Member for Penrith (Mr. Dixey) cannot go into it again.

§ Mr. DIXEY
I should be the last to disagree with a Ruling from the Chair, 2067 but when this Committee is called upon to vote such a large additional sum for law costs, I think I am entitled to raise the question of the emoluments of counsel. This sum includes the fees paid to counsel.

§ The CHAIRMAN
I know it does, but the point which the hon. Member is raising has already been raised several times, and there is a rule against the repetition either of one's own arguments, or of other people's arguments in these discussions.

§ Mr. DIXEY
I am not putting this point in any factious way, but because I think it a relevant point. I am submitting that this Estimate is increased far more than is necessary because very expensive counsel are employed.

§ The CHAIRMAN
That is the very point to which I am objecting. The hon. Member is repeating an argument which has already been used, and that is contrary to the rule.

§ Mr. DIXEY
I bow to your Ruling, Sir Robert, and I conclude by saying that at a time of great financial crisis, when even comparatively small sums might well be appropriated to dealing with some of the very important unemployment problems confronting us, the Treasury ought to exercise the utmost care over expenditure on legal costs. I wish for some assurance from the Attorney-General that his department is scrutinising every penny of such expenditure.

§ Mr. RAMSBOTHAM
I had the advantage of hearing the Attorney-General's opening speech, and I hope I shall not break the rule against repetition. The Attorney-General gave certain figures as to the cases in which he had been successful, and those in which he had been unsuccessful, and, according to my recollection, he said he had won 39 and lost 40. That is not the sort of record which will get him into a cup final. The point which I wish to raise is as regards the costs of the unfortunate private individual who is an unsuccessful litigant in these cases.

§ The CHAIRMAN
That does not arise here. We are concerned in this Supplementary Estimate with the legal costs of the Government.

§ Sir G. PENNY
If it cost the individual a certain sum, would the Government not have to meet less in regard to costs?

§ Mr. RAMSBOTHAM
I will go to a, point which I hope will be in order. The litigant normally has no option against the Attorney-General if he takes him to the House of Lords. In many instances, the case is settled in the Court of first instance and the matter goes no further, but in other instances the litigant has no option when the case is taken to the House of Lords for the benefit of the nation. I want to know how in these cases the Crown deals with the private individual in the matter of costs, because great unfairness may result if the unfortunate private individual is taken to the House of Lords and left to bear the burden of the costs.

§ The ATTORNEY-GENERAL
The cases which I take are all test cases, and I do not think that any de-rating case has gone to the House of Lords unless there has been a trade association on the other side. It frequently happens that the Crown are successful and consent to pay the costs on the other side, but such a question has not arisen in de-rating cases.

§ Mr. ERNEST BROWN
It is very awkward when Members raise issues of this kind involving litigation and find that the Treasury holds one view and the Member holds another. He is at a tremendous disadvantage, as I was last Session in the matter of the taxation of unemployment grants. I was told that I was wrong and in the end a small dock company had to take it to the Court of Appeal, and it was found that the private Member was right and the Treasury was wrong. A small body of taxpayers are at a great disadvantage with the Crown, especially when a test case is decided as it has been in these de-rating questions, and the man who has comparatively limited resources is called upon to pay the costs of settling a case which affects a large number of other people, who are thereby released from any obligation to go forward with their case. That is constantly arising, and very often Members of this House have to attack the Treasury one way and another, and in the end cases cannot go to the final court because those whom Members are trying to represent have not the right 2069 of appeal, and have to bow to departmental Rulings, so that they are hopelessly handicapped.