HC Deb 30 March 1938 vol 333 cc2027-33

(1) Subject to the provisions of this Section, coal the fee simple in which is at the commencement of this Act vested in statutory undertakers (that is to say, a local authority, company or other body or person authorised by or under an Act of Parliament, or an order having the force of an Act of Parliament, to construct, work, or carry on a railway, canal, inland navigation, dock, harbour, tramway, gas, electricity, water, sewage disposal, or other public undertaking), having been acquired, under powers in that behalf conferred by any such Act or order as aforesaid, for the purposes of their undertaking, shall vest in the Commission subject, in addition to the matters mentioned in Subsection (4) of Section four of this Act, to the restriction that the coal shall not be worked without the previous consent in writing of the persons in whom the undertaking is for the time being vested.

(2) The foregoing Sub-section shall not apply to any such coal as aforesaid in a case in which the undertakers are not at the commencement of this Act interested in any land supported thereby, and, where any such coal as aforesaid vests in the Commission subject to the restriction aforesaid, the restriction shall have effect so long only as the persons in whom the undertaking is for the time being vested are interested in land supported thereby.

(3) Sub-section (1) of this Section shall not apply to any such coal as aforesaid which is subject at the commencement of this Act to a coal-mining lease.

(4) A restriction imposed by this Section shall not have effect in relation to working carried on in exercise of a right subject to which the coal in question vests in the Commission by virtue of this Part of this Act.

(5) A consent in relation to a restriction imposed by this Section shall not be unreasonably withheld, but this provision does not preclude the right of undertakers whose consent is sought—

  1. (a) to give consent subject, as far as may be reasonably requisite, to a condition that working shall not be such as to let down any land in which the undertakers are interested, or shall be limited to working in particular places or in a particular manner, or to other conditions or limitations as regards the working consented to or the making good, or paying proper compensation for, damage arising therefrom; or
  2. (b) to require, as a condition of consent, payment of a reasonable sum in respect of any legal or other expenses incurred in connection with the consent.
Any question arising under this Sub-section shall be referred to and determined by the Railway and Canal Commission, who shall have power to dispense with consent either without conditions or limitations or subject to any such conditions or limitations as aforesaid, la determining any such question the Railway and Canal Commission shall have regard primarily to the safety and efficient working of the undertaking in question.

(6) A restriction imposed by this Section shall be enforceable by the persons in whom the undertaking is for the time being vested in the like manner, and against the like persons, as if it had been imposed by a covenant entered into by the Commission on the vesting date.

(7) A holding subsisting in coal that is to vest in the Commission subject to a restriction imposed by this Section shall (notwithstanding the provisions of Section seven of this Act which require the value of a holding to be ascertained by reference to the amount which it might have been expected to realise if this Act had not been passed) be valued as if provision had been made before the valuation date for that restriction to take effect on the vesting date.—[The Attorney-General.]

Brought up, and read the First time.

4.17 p.m.

The Attorney-General (Sir Donald Somervell)

I beg to move, "That the Clause be read a Second time."

This Clause has been put down in fulfilment of some pledges which were given by my right hon. Friend on an Amendment moved by my hon. Friend the Member for North Leeds (Mr. Peake), dealing with the position of statutory undertakers and other allied undertakers who have bought coal in order that they might have support for the surface on which they carry on their undertakings, and whose position is, of course, affected by the present Bill. The complaint which was made, and which was made on an earlier Amendment supported by Members in all parts of the House, was that, under the Bill, not only did that coal vest in the Commission, but the Commission would have the right to work it, and the statutory undertakers could only get protection by themselves going to the Railway and Canal Commission and raising an objection. It was suggested that, if I may so put it, the boot should be on the other leg, that is to say, that the statutory undertaker should have the primary right to say that the coal should not be worked, and that if the Commission came to the conclusion that it ought to be worked, and there was no reason why it should not be worked, the onus should be on them to go to the Railway and Canal Commission and satisfy that court that the statutory undertaker was unreasonably withholding his consent. This Clause substantially carries out that undertaking, and deals also with some minor matters of a collateral character which have to be dealt with.

4.20 p.m.

Mr. Harold Macmillan

In thanking the Government for putting down this Clause, I should only like to add one observation. A somewhat paradoxical situation arises out of the Bill, namely, that the statutory undertakers referred to, who have purchased coal for the purpose of maintaining the safety of their undertakings, are in a somewhat less favourable position under the Bill than if they had not purchased the coal, but had merely taken steps to sterilise it. That is a source of some difficulty, but I think there is general agreement that for practical purposes it is met by the proposed new Clause, and more especially by those parts of the Clause which embody the Amendments that were put down on behalf of the statutory undertakers. Although they feel that the position is somewhat paradoxical, I think there is a general feeling that the Clause as now drawn will in practice and in effect meet the main object which they have in mind, namely, the protection and safety and effective working of their undertakings.

4.22 p.m.

Mr. David Adams

I had the privilege of raising this question, which is fairly well met by the proposed new Clause, on behalf of the Tyne Improvement Commissioners, who are large owners of coal which they have deliberately purchased for the purpose of maintaining their various undertakings. An undertaking was given in Committee that this matter would have the consideration to which it was undoubtedly entitled. It seems to me, and I think to others who raised the matter on behalf of railways and so on, that the objections raised have been satisfactorily met. The interests of the Tyne Improvement Commission are safeguarded by the Clause, and I thank the Minister for it.

4.23 p.m.

Sir Reginald Clarry

I beg to move, as an Amendment to the proposed new Clause, in line 46, to leave out Subsection (7).

I move this Amendment mainly to obtain some explanation of the provisions of Sub-section (7), or, if, as we feel is possible, there has been a drafting oversight, to get it rectified. It would seem that the Commission can override the objections of a statutory authority and acquire coal under the land of that authority, and that that coal may in fact be worked, whereas the basis of the valuation of the coal is the assumption that it will not be worked. There appears to be some contradiction in this. We have not attempted to put down an Amendment to correct that apparent contradiction, but we think that an explanation might be useful.

4.24 p.m.

Mr. H. G. Williams

I beg to second the Amendment.

While I am grateful to the Government so far as the Clause as a whole is concerned, I must say I find it difficult to understand the precise significance of Sub-section (7). As my hon. Friend has just pointed out, apparently the statutory undertakers are to have this coal paid for on the basis that it remains as a support, and never yields any revenue, or, in other words, that it is to be paid for on the assumption that it is sterilised. But later on, payment having been made on that basis, it may be that permission will be given to work the coal, in which event the Commission will draw royalties in respect of something for which they have not paid, and to that extent the people who originally bought the coal will receive inadequate compensation. That is how I read Sub-section (7). I have been through it about four times, and it is still not very clear to me, though I have no doubt that the legal gentlemen in due course, and on receipt of adequate fees, will be able to explain to the court what it means. If it means what I think it means, I do not think it is quite fair, and I hope the matter will be made a little more clear to us.

4.26 p.m.

The Attorney-General

I will do my best to explain the matter. Under the Bill, this coal, with other coal, vests in the Commission. Everybody is agreed about that, and, although my hon. Friend thinks he detects a certain illogicality in the position, he is more or less reconciled to it. That being so, the coal has to be paid for now. The coal vests in the Commission on the basis of its present value, and in the case of, I should say, 99, or perhaps even 99.9 per cent. of this coal, it will be quite clear that under the provisions of the Clause it never can be worked, and never will be worked. Therefore it has no value as coal, but is simply a support, as though it were ordinary earth instead of coal. But, in a Clause like this, one has to make provision for possible cases, even though they may be unlikely, and that is why it is provided earlier in the Clause that, if the circumstances are such that it is reasonable that the coal should be worked, and if it is no longer required for purposes of support, the Commission can ask the consent of the statutory undertakers, and the statutory undertakers can give their consent, or, if the Commission think that such consent is unreasonably refused, recourse can be had in the last resort to the Railway and Canal Commission. That being so, the compensation must be assessed on that principle, having regard to the provisions of the Sub-section.

Sir R. Clarry

As if the Act had not been passed?

The Attorney-General

Sub-section (7) includes the words: notwithstanding the provisions of Section seven of this Act, which require the value of a holding to be ascertained by reference to the amount which it might have been expected to realise if this Act had not been passed. That would apply to the coal if it had been sold and had not been sterilised. If the Act itself said that the coal should not be worked, clearly you could not give compensation, on the assumption that the prohibition of working was effective. Probably in 99.9 per cent. of the cases there will never be any question of this coal being worked, but theoretically there might be a case where a statutory undertaker had bought coal which was no longer required as a support for the surface, and, therefore, was available for working. If it is available for working and their consent requires to be given, it is right that it should be paid for as workable, and not as sterilised. I think the provision of Sub-section (7) is a right one. It provides for the valuation now of what in all probability never can and never will be worked, and which is therefore worth nothing, but if there are cases where the sterilisation might not apply, or might not apply to a part of the coal, the statutory undertaker would be entitled to compensation.

Mr. H. G. Williams

Do I understand that if permission is given to work this coal later on the statutory undertaking will get further compensation?

The Attorney-General

No; the statutory undertaking has applied for and got the sterilisation of the coal subject to certain exceptional circumstances. As far as one can see, that will prevent anything of this sort.

Sir R. Clarry

Will my hon. and learned Friend be good enough to look into the matter, and see whether he can make it clearer by having at least one sentence saying that there are two bases of value on the two cases arising under this Clause? It does not say that in Subsection (7).

Mr. H. Macmillan

I still and this a little difficult to follow. Does this mean that the coal purchased by the statutory undertaking, since it is to be sterilised permanently, is to be valued at nil? I am told that in the past considerable sums have been paid in some cases for this coal, where the operation has been by conveyance rather than by sterilisation. If this is to be valued at nil, because of the restrictions of the new Clause, that raises rather a new point, and coal for which considerable sums have been paid is taken at no value. But perhaps I misunderstood.

The Attorney-General

I can speak again only with the leave of the House. I quite agree that these workings sometimes cost a good deal to buy, but they are worth nothing as long as they are required for the purpose of support. The basis of valuation must be the value in the market. If it is bought never to be worked, it is worth nothing to the statutory undertaking, and nothing will be paid for it.

Mr. Macmillan

Unless it is worked?

The Attorney-General

Unless it is worked.

Sir R. Clarry

I beg to ask leave to withdraw the Amendment.

Amendment to the proposed Clause, by leave, withdrawn.

Clause added to the Bill.