HC Deb 31 October 1939 vol 352 cc1810-7

Question again proposed, "That the Clause be read a Second time."

5.42 p.m.

Mr. K. Griffith

I had arrived at the point where I was trying to show that under the new Clause a procedure which was regarded as so essential in regulating prosecutions under the original scope of the Bill is completely abandoned in connection with the new and additional remedy of proceedings in the civil courts. I want to recall one of the objections made by the learned Solicitor-General in rejecting the original Amendment of the hon. Member for Seaham. He said that if we were to place upon a court of summary jurisdiction the possible duty of imposing a penalty by way of restitution of the price to the buyer the court would have to go through the procedure of finding out exactly what was the excess charge, and the Solicitor-General was suggesting that that was a burden which ought not to be put upon a court of summary jurisdiction. He said that it would be enough for them to discover that there had been a breach by the exceeding of the basic price which was not justified by the permitted increase without deciding exactly what that permitted increase might be. That burden which he rejected for the courts of summary jurisdiction he is now imposing in full measure upon a county court or whatever other tribunal has to decide the case when a plaintiff brings an action in the civil courts. It will now have to decide exactly what is to be restored, and have to go through the process of discovering, by reference to the First Schedule, exactly what the permitted increase is in order to find out the difference between that and the actual charge.

There is this additional burden, that in the case of a prosecution as contemplated by the original Bill and by the Amendment of the hon. Member for Seaham there would have been the preliminary examination by the price regulation committee, who would have been specially selected to perform that job and could have carried it out with great efficiency. Under this procedure there is no such preliminary inquiry and no approval required by the Board of Trade to the proceedings being launched. The private individual who feels himself aggrieved, thinks a dirty trick has been played upon him and brings an action, has now got to prove it. I say that he has now got to prove it but I am not certain about that, and that is one of the questions I want to ask the learned Solicitor-General. With whom does the burden of proof now lie in these new proceedings? In the proceedings contemplated by the Bill, the burden of proof, once it was established that the basic price had been exceeded, was specifically placed upon the defendant. He had to show that he could justify the permitted increase. That, I gather from the Bill, applies solely to any prosecution, but we are now concerned not with prosecution but with civil action. Therefore, I presume that, in a civil action, the plaintiff will have to prove effectively that the price charged is not only beyond the basic price but beyond the permitted increase.

What machinery is he to employ? He will not know the facts referred to in the First Schedule in regard to the business of the individual whom he is suing. I presume that he will be allowed to obtain discovery; if so, all the documents of the business of the defendant firm will have to be supplied, revealed to the court, and gone into, it may be only because of £1,30s. or perhaps a couple of pounds, representing the amount in respect of which the defendant is being sued. The calculation will be made in respect to the defendant firm to establish how far they were entitled to increase their charges, in view of the total increase in their overheads as justified by the matters set out in the Schedule. Then there will have to be done an additional sum to find out how much of that increase is to be attributed to the line of articles concerned. This procedure will be extraordinarily cumbrous and oppressive to the traders concerned and will produce no better results, and at no less cost, than that which was suggested by the original Amendment of the hon. Member for Seaham.

That Amendment had the advantage that the procedure of restitution was to be judged by a court which was brought into being and into action only after full investigation of the technical matters involved in the case, by the special and skilled advisory price-committees set up under the Bill. The whole of that procedure is scrapped. The haphazard procedure of the aggrieved person bringing his action of his own knowledge and without any expert examination is restored. It seems to me that the whole original idea of the Bill is scrapped as regards this additional increase. I wonder what it is hoped to gain by so doing. Is it supposed that would-be plaintiffs will be deterred from bringing action by the mere prospect of having to pay costs after having brought an action and lost it? I am not at all sure that that will be a sufficient deterrent. I can imagine the businesses of traders being brought absolutely to a standstill by a succession of actions in the county court for quite small amounts, all of which might be justified, and which would require the constant attention of executive officers of companies or firms in order to produce their accounts before the court and go through them in detail in order to justify those comparatively small increases of price.

Therefore, I do most respectfully suggest that one of two courses should be followed; either we should rely upon the penal provisions of the Bill, carefully thought-out as they were before the Bill was brought before the House, with the very extensive fines and possibly imprisonment, which I should have thought would have been sufficient deterrent to any intending wrongdoer, or, if it is thought that there should be some restitution, that it should be left in the hands of the same court that tried the action from a criminal point of view and would therefore have the advantage, which the proposed new Clause does not supply, of a preliminary investigation by those skilled committees, dealt with under paragraph 8 of the First Schedule, which I imagine to be the whole cornerstone of the Bill.

5.50 p.m.

Sir George Schuster

I find myself at present in complete agreement with everything said by the hon. Gentleman who has just sat down. I have really been so astounded on reading the proposed new Clause that I can only believe that I must be mistaken in what I think the effect of it will be. I hope that we shall have an explanation from the Government Front Bench which will counteract the view which I have formed about the new Clause. Let me refer to what I always understood, and I thought the House understood, to be the essential feature of the Bill. I will put it in this way: There was to be, in any case of complaint about excessive prices, a really adequate expert investigation. Looking at the matter from the point of view of persons engaged in retail trade, I think what they mostly fear, when anti-profiteering measures are suggested, is that they may be subjected to something in the nature of blackmailing actions. I have no experience of trading in conditions where this kind of legislation has been in force, but I am told by those who have had such experience that that is what they mainly fear. Complaints are very often made, not by genuinely aggrieved members of the public, but, possibly, by competing traders. There is a genuine fear of blackmailing actions.

In the stages when the Bill was in course of preparation the right hon. Gentleman was extremely good in taking into consultation representatives of all the trading organisations. We were extremely grateful for the way in which the matter was handled and by the obvious care which was being taken to produce something which would work fairly. When we put to the representatives of the Board of Trade that apprehension about blackmailing procedure we were told: "You will be perfectly safeguarded against that in the Measure, because all possible cases of complaint will be considered by the area committees. The area committees will be composed of people who understand the business, and the areas will be sufficiently large to make it impossible for any little local interests and jealousies to be brought into play." We all felt that that was a complete answer to the apprehensions which we had voiced and we felt indeed that the Measure—many of us said so during the Second Reading Debate--was admirably conceived.

Now, at the very last stage, when there is no time to reconsider the matter, the proposed new Clause is moved, and it seems to us that it completely outflanks the position which we understood had been set up. The hon. Member has just pointed out, and the Solicitor-General himself said, that these actions in the civil court can be brought at any time. His words were to the effect that no doubt the normal procedure would be to start an action when the case had been investigated by the area committee. That might be the normal procedure, but he made it perfectly clear—

Mr. Shinwell

I understood the Solicitor-General to say that the matter would be so dealt with when there had been a conviction.

Sir G. Schuster

Perhaps the hon. and learned Gentleman will explain the point.

The Solicitor-General

The hon. Member for Seaham (Mr. Shinwell) is quite right. What I said was that in the usual case there would have been a conviction, so that the extent of the excess would be known.

Sir G. Schuster

That may be so; but I think I am right in saying that the hon. and learned Gentleman went on to say that, although that might be the normal case, these civil actions could be brought by anybody whether the matter had been referred to an area committee or not. [An HON. MEMBER: "Why not?"] I have already made clear to the House that there seem to be great objections to that procedure because it would sidetrack all the carefully designed committee procedure which is the very essence of the Bill. We understood that the personnel of these area committees would be carefully selected to go into these cases thoroughly, and in a way which would secure a fair result; but under the new Clause, anybody with a feeling of grievance could bring a case before a county court at any time, and the difficulty of dealing with such cases in the county court will be excessive, as the hon. Member has just pointed out. On these grounds I feel the proposed new Clause completely stultifies and nullifies the principle on which this Measure was recommended to the House and secured universal support. I hope that I may be told that I have misunderstood the position but, if that is not the case, I hope that the Government will seriously reconsider the matter.

5.56 p.m.

The Solicitor-General

I would like to intervene again, by leave of the House, in order to say that I do not recognise here any real departure from the principle of the Bill. It is a totally different thing to say that power to bring criminal procedure should be subjected to regulation of the Board of Trade and saying that individuals should be entitled to enforce a civil right arising out of transactions which have been subject to criminal proceedings. I do not recognise, nor does my right hon. Friend, that there has been any departure from the principles that he outlined when the Bill was introduced.

Sir G. Schuster

This point seems very important. The hon. and learned Gentleman says that he sees no departure in admitting the taking of civil proceedings on a matter in regard to which a criminal prosecution has been carried out. That is perfectly all right. If the procedure of criminal prosecution has been gone through, I can raise no possible objection to civil proceedings, but that these civil proceedings should be taken before there has been any criminal prosecution and conviction seems to be objectionable.

The Solicitor-General

If my hon. Friend had waited for a moment I would have dealt with that point. I will deal also with the point raised by the hon. Member for West Middlesbrough (Mr. K. Griffith). One has to find one's way through a number of conflicting elements, but let us take a typical case. Somebody is prosecuted, and knew that he would be prosecuted, for the sale of one article of a particular kind. He incurs the maximum penalty. He may nevertheless do extremely well unless there is some risk run that, by doing a series of such transactions, he will supplement the penalty that has been ordered in the criminal proceedings. That is one element in this matter, and therefore we were convinced that the mere imposition of a criminal penalty might not in all cases be enough.

Sir G. Schuster

Why not make it heavier?

The Solicitor-General

The ordinary trader might still have an inducement, unless you proposed fantastic penalties in the Bill and invited courts of summary jurisdiction to do silly things—as I gather would be the idea. On the other hand, I recognise the force of the argument of the hon. Member for West Middlesbrough that you should tie this remedy a little more closely to cases where there has been prosecution. The suggestion in the original Amendment was to allow recovery where the individual was the originator of the prosecution, but we did not think that that would be enough.

If the House would agree to the course now suggested and would let the proposed new Clause go through as it stands, we will endeavour, between now and other stages, which I am afraid will have to take place in another place, to confine the civil right to cases in which there has been a prosecution. That is to say, supposing a man has been selling products to dozens of people, if one person has successfully set a prosecution in motion through the price regulation committee, with the sanction of the Board of Trade, then, in respect of articles of a similar character, all those who have had similar transactions, the fact of overcharging having been established in the criminal court, may have available a civil right. I am not to be taken as pledging the Government to any particular form of procedure. What I think would not be satisfactory would be a right which inured only to the benefit of the individual whose case had been the subject of a criminal prosecution. I hope we shall be allowed to have the new Clause and that we shall be able to look into the matter further.

6 p.m.

Sir H. Williams

The Solicitor-General has pointed out the reasons for this Clause, and the matter was dealt with admirably, if I may say so, in the clear speech of the hon. Gentleman the Member for West Middlesbrough (Mr. K. Griffith). I hope some attention will be given to the words "an unreasonable time." We have often been called upon to interpret the word "reasonable" but in regard to interpreting the word "unreasonable" I think there may be some difficulties. Another phrase to which attention should be drawn is "tenders the goods to the seller in substantially the same state." I am not a lawyer but there are lawyers among those who are listening to me, and I can visualise trouble arising over those words. I will say no more beyond draw- ing the attention of my right hon. Friend to those words, as I think there is some doubt as to their significance.

Question, "That the Clause be read a Second time," put, and agreed to. Clause added to the Bill.