HC Deb 12 May 1933 vol 277 cc1854-60

Amendments made; In page 4, line 8, leave out the word "to," and insert instead thereof the word "and,".

In line 11, leave out the words, "The provisions of"—[The Solicitor-General.]

Motion made, and Question proposed, "That the Bill be now read the Third time."

11.41 a.m.

Mr. BIRD

The law is an honourable profession, and I should not like any Member or hon. Member of this House to think that, in introducing this Bill, I wish to cast any reflection upon many honourable men. The profession, both branches of it, has produced many men who have been very fine citizens, and I trust that it will do the sane in the future. The Bill is really brought in for the purpose of seeing whether it is possible for the Law Society to do anything further to protect clients. I hold the view that all men at the origin are honest. Their intentions are honest, and, if temptation does not come to them, they remain honest. I believe that, if a solicitor had two accounts, as a great number of them already have, he would not draw money which was earmarked for his clients' account. But a solicitor, perhaps a young fellow starting in practice with small means, who has only one account and feels the necessity for drawing money, possibly goes to his cashier or looks at his account and finds that he has, shall we say, £506 in it. He promptly draws, say, £50, whereas if he had had two accounts he would have seen that, instead of there being £50 of his own money, £500 was his clients' money and only £6 was his own money. If the fact had been made clear to him from an inspection of two accounts, he would not have taken the first step on the way to defaulting in regard to the accounts of his clients.

Many hon. Members have suggested that other methods might have been taken than those proposed in the Bill. Those matters have been before the Law Society for many years, and it has not been possible to reach any agreement in respect of them. At one time it was suggested that an official audit should be made. That was not agreed to, and, indeed, as I pointed out to my hon. Friend opposite, it was found to be impracticable. Another suggestion was that there should be a fidelity fund. In spite of the view held by many hon. Members who do not belong to the legal profession, solicitors are not rich men. The average income of a solicitor is comparatively small. He averages between £300 and £400 a year. It would be an imposition if an honest solicitor had to pay out of his small income a large fee to an insurance company for the benefit of the whole profession, possibly to see that some of his competitors who were undercutting him should have protection for their clients at his expense, That was an impossibility. Indeed, if one might put it in this way, if there had been a fidelity fund, it could not have been a very large one although the defalcations are few in number. For many years past the average number of defaulting solicitors has been only 15 out of 15,000 on the roll. That is a very small figure, but unfortunately, some have been very large defalcations, and any guaranteed fund that had been set up in the profession would have been wiped out by any one of them. Therefore, that protection was found to be an impossibility. I do not wish to detain the House further but I desire to thank hon. and right hon. Members, and particularly my hon. Friend the Member for Westhoughton (Mr. Rhys Davies) for the assistance they have given me in Committee and the assistance they have given me this morning. I know that you cannot make people honest by legislation, but I believe that this Bill will be an advantage to the profession and to the public.

11.46 a.m.

Sir J. WITHERS

Having regard to the fact that I have in the past introduced several Bills dealing with this matter I think I ought to say a few words on the Third Reading. In the past the Law Society has found it difficult to move owing to disagreement among themselves, and therefore I have taken the invidious course of acting as a private Member and bringing in a Bill. The work now carried out by this Bill has been the object practically of my life for 30 years, and to see it carried out has been a very great satisfaction to me. It is also a very great satisfaction to me to think that the Law Society Council, at last, have taken the matter into their own hands and have had the fortitude to act. I congratulate them and the whole profession on the work that has been done.

11.47 p.m

Mr. RHYS DAVIES

I think I shall be voicing the opinions of Members of all parties in congratulating the two hon. Members opposite on piloting the Bill up to the Third Reading stage. I have always felt that the Bill was a very useful one not only for solicitors, who will be compelled to carry out the law and keep separate accounts, but for some of their clients who have gone through such terrible tragedies consequent upon defalcations. I have supported the Bill throughout mainly on that score. One has often seen in the Press accounts of what happens when lawyers do not keep accounts such as the Bill will in future require them to do. One very pleasing feature of the debates on the Measure has been the unanimity of the legal profession in connection with it. There is, indeed, a sort of freemasonry among them when any subject connected with their own profession is raised in the House. All their party political bias and prejudice ceases when any Bill affecting their profession comes forward. I do not blame them. Speaking as an individual Member I feel sure that the community as a whole will be glad to see the Bill become law.

11.48 p.m.

Sir WALTER GREAVES-LORD

As one who has been in a very minor degree associated with the Bill I want to say how glad I am that it has been possible to bring it to its present stage and that it is to pass on to the Statute Book. Solicitors are not always in agreement. The hon. Member for Westhoughton (Mr. Rhys Davies) has probably rather over-emphasised the fact that they have always come together on matters concerning their profession.

Mr. DAVIES

I meant unanimity here, not outside.

Sir W. GREAVES-LORD

The Bill is the result of two totally divergent views. Although solicitors unite in defence of their profession they may have very strong and divergent views as to methods of administration and government. Those are definite opinions formed as the result of their practice. Those views were emphasised and expressed very forcibly in regard to the matters contained in the Bill. The happy thing about the Bill is that, those views having been expressed and threshed out between those who differed, the Bill is an expression of unanimity as the result of all the points being considered and every point of view. That is a very happy result.

11.50 p.m.

Major MILNER

I desire to add my voice to the voices of other hon. Members in favour of the Third Reading of the Bill, and particularly to congratulate the hon. Member for Skipton (Mr. Roy Bird) on carrying through this very excellent Measure. We all know the deep interest that he has taken in the matter, and he is to be congratulated not only by the profession but by the general public on the fact that the Bill has been carried through to a successful conclusion. I am also very pleased, and I am sure that my words will be echoed by many hon. Members, and by the profession, that the hon. Member for Cambridge University (Sir J. Withers) has been associated with the Bill. In the past he has on occasion taken a rather different view, but I wholeheartedly pay my tribute to him for furthering the interests of the Bill, which may not in every detail agree with some of the views that he has expressed in the past.

In regard to my hon. Friend the Member for Westhoughton (Mr. Rhys Davies), I know that now and throughout the course of the Bill he has been concerned not only with the interests of the profession but with the protection of clients. As regards the unanimity of the legal profession, I am sure that as a trade union official he appreciates that this is one of those cases where there is something in the nature of a united front in the profession. It ought to be known that the provincial solicitors are equally in favour of the Bill with those members of the profession who practice in London, as do both my hon. Friends opposite. I hope that the Law Society in drawing up their rules, in concurrence with the Master of the Rolls, will think it right either to submit those rules to the provincial law societies or take their opinion in regard to them. This is a matter on which the profession can unite, along with the general public, in doing a very useful piece of work.

11.53 p.m.

Mr. H. WILLIAMS

As a potential client, I congratulate the members of the legal profession on their unanimity today. The hon. Member for Skipton (Mr. Roy Bird) has rendered a real public service. On another Measure last Friday I explained how my interest in this subject began. I hope that the Measure will have the effect that is desired. I wished to urge another method instead of that sketched in the Bill, but against that other method my hon. Friend has advanced substantial arguments this morning. I support the Third Reading with the greatest possible pleasure, but that pleasure would be even greater if the last 14 lines of the Bill did not appear. I hope that in due course the profession in this country will be able to persuade their Scottish colleagues to advance along the line of progress along which they are advancing. It is a little unfortunate that the law in the two parts of the United Kingdom is going to be different. It is just as important that Scottish clients should be protected and that Scottish solicitors should be protected. I regard this as a Bill to protect solicitors and not merely to protect the public. Those who practise in Scotland should be protected as well as those who practise in England. There is an English interest, because English people employ Scottish solicitors from time to time. I hope there will be some propaganda done by the more enlightened brethren south of the Tweed among their less advanced brethren north of the Tweed.

11.55 a.m.

Mr. THORP

Although the hon. Member for Skipton (Mr. Bird) has said that I have already made a Third Reading speech nevertheless I want to support the Third Reading of the Bill because I do not want my attitude to be in any way misunderstood. The Amendments I put down for the consideration of the House were not in any way untra-critical of the principle of the Bill, and if I did make a Third Reading speech in connection with the proposed omission of Clause 3 I did so rather with a view of testing how far the Bill was to operate, what its scope was to be, and to make it abundantly clear that when Members of the profession do go wrong, they are very few, some of them do so quite inadvertently by confusing money of their own with the money of their clients. I am the last person to oppose the passage of the Bill. The reason why I opposed it in the first place was because as originally drafted it was proposed that the fines to be levied should be given to the Law Society. That was not a, new proposal; it is a very ancient one indeed.

Hundreds of years ago people in a judicial capacity had a financial interest in the amount of the fine inflicted, and I did not want the President of the Solicitors Committee to be placed in the invidious position of ringing up the Treasurer of the Law Society and asking the amount of their overdraft, and, if it was "X" for him to say "the fine in this case is X plus £50, so that it will put us in credit to the extent of £50." That is an extremely undignified position. The administration of justice should always be regarded by the public as being properly carried out, and there would be some uncharitable people who would say that the reason why so and so was fined a large sum of money was because they wanted the proceeds of the fine for themselves. That, of course, would be unfair, but the person who has to approach a decision in a judicial manner, when he —and others—is interested in the financial result, is placed in an invidious position. I am of the opinion that the separation of the two accounts is the first step towards preventing defalcations on the part of solicitors, and for these reasons I heartily support the Third Reading.

11.58 a.m.

Mr. A. SOMERVILLE

Some two years ago at the instance of a group of Members of the House I introduced a Bill on this subject, which was intended to be in the nature of a kite. That led it to certain negotiations with representatives of the Law Society, in which the hon. Member for Farnham (Sir A. M. Samuel) and the hon. Member for Cambridge University (Sir J. Withers) took a leading part. The negotiations continued, and the result has been an agreement of all branches of the legal profession in getting this Bill through Parliament. It is the most satisfactory way of dealing with an unsatisfactory position.

Question put, and agreed to.

Bill read the Third time, and passed.