HC Deb 03 July 1940 vol 362 cc950-4
The Attorney-General

I beg to move, in page 4, line 28, at the end, to insert: 'armed forces of His Majesty' does not include the Local Defence Volunteers; 'hire-purchase agreement,' 'hire-purchase price,' 'owner' and 'hirer' have the meanings respectively assigned to them by Section twenty-one of the Hire Purchase Act, 1938.' This is the first Amendment to Clause 5 and is consequential on a new Clause which also stands in my name, namely, "Provisions as to mortgages." The second Amendment is consequential on a second new Clause standing in my name, namely, "Restriction on delivery of goods." I do not know whether the Committee would be prepared to pass this Amendment now without discussion and then to allow me to give an explanation on the new Clause, or whether I should give an explanation on this first Amendment.

The Deputy-Chairman

I should have thought—and I am subject to the permission of the Committee—that it would be more convenient to discuss the whole matter, both the new Clauses and the Amendment, if that is the wish of the Committee.

The Attorney-General

I will explain then the Clauses and Amendments. The first new Clause deals with provisions as to mortgages. A mortgagor, a man who is perhaps building his house or purchasing his house and has a mortgage debt on it, has a form of liability which is of the utmost importance to him. If there is foreclosure of the mortgage, or if possession is taken of the property, it may be a serious matter for him. For that reason, we thought it right to make provision in this new Clause for the protection of serving soldiers. It may appear a little drastic from the point of view of the mortgagee, but we thought it right to make such provision.

The problem has arisen in this way. Suppose a mortgagee applies for possession because there is default and asks for leave to take one of the remedies under the mortgage, which are referred to in the Courts (Emergency Powers) Act. The mortgagor does not appear, and, as things are at present, it is difficult, if not impossible, for the court to do anything but give leave to the mortgagee to take his order. No inability to pay owing to war circumstances has been proved and the mortgagor is not there. That is a problem which we felt ought to be dealt with, because the mortgagor may be a soldier serving abroad. There may have been an order for what is called substituted service by post, instead of personally, which he has never received, and he may know nothing about the application. A plain injustice would be committed if an order were made by which possession was taken of the property and it was perhaps sold. The scheme of the Clause is that, if the mortgagor is absent, the court assumes that he is a serving soldier unless the mortgagee proves the contrary. That puts the onus on the mortgagee to prove that the mortgagor is not a serving soldier.

The new Clause goes further and provides that, if he is a serving soldier, or if the case proceeds on the basis that he is a serving soldier—either because he has appeared or because he is assumed to be one—the onus is placed on the mortgagee to show that there is ability to pay. We do not leave it to the serving soldier to prove inability to pay. From the point of view of mortgagees that may seem rather a tall order, and that is why we restrict this provision to the question of mortgages. It may be of vital importance because a man's savings may be imperilled unless he gets protection. Subsection (3) is necessary in cases where the mortgagor has shut up the house and gone off. He cannot be found, he is assumed to be a serving soldier, and the mortgagee cannot get possession and exercise his remedies at that stage. It may therefore be desirable that somebody should be appointed to look after the property to prevent it falling into rack and ruin. This Sub-section enables a receiver to be appointed. Subsection (4) deals with a technical point under the Mortgage (Emergency Provisions) Act, which was intended to make it clear that proceedings could not be taken by mortgagees unless there had been default. There is some question whether that covers cases where the mortgagee seeks possession by virtue of the determining Clause.

With regard to the new Clause dealing with the restriction on delivery of goods, the principal Act says that no person shall be entitled, except with the leave of the court, to proceed to exercise any remedy available to him by way of taking possession of any property. The common case is the hire-purchase agreement. The supplier under a hire-purchase agreement cannot exercise his right to retake a gramophone or furniture unless he gets the leave of the court. That is all right, and it is clear that that covers the case where he is doing it outside court procedure. But it has been held that the words used here do not cover the case where a man gets, as part of legal proceedings, a specific order for the recovery of possession of goods. This second Clause brings that case within the scope of the Act and says that where you have a judgment entitling you to get goods, you have to apply for leave to enforce it in exactly the same way as when you get a judgment entitling you to a sum of money. It is a small point but the Clause puts it right. In the Amendments on the Order Paper we exclude from the first new Clause, dealing with mortgages, the Local Defence Volunteers. The reason is obvious—that they are employed in their own locality, and the special provisions which we have introduced are to protect serving soldiers who will be away from their homes, who may be abroad, and may not have adequate notice of proceedings being taken against them.

9.47 p.m.

Mr. Rhys Davies

I do not want to criticise what the right hon. and learned Gentleman has said, because in my view all what he has said ought to be done, but I think a new problem in connection with building societies and mortgages will arise very soon. The case has been put to me of ordinary working-class folk moving from dangerous areas to live in other parts of the country, and leaving their houses and furniture behind. I was asked my opinion. I am not a lawyer but I gave the best information I could. I said that in any case, if their mortgages were not paid up to date, I felt sure the courts would not exercise their power to compel them to pay their dues, while they were in some other part of the country. I am very much afraid that this may be rather a serious problem in some places because, of course, the people concerned will not be able to pay. Perhaps the right hon. and learned Gentleman will look into the question. I do not know whether the law, as it stands, safeguards their interests, but I thought it did and I gave information to that effect.

9.49 p.m.

Mr. Glenvil Hall

I think everyone in the Committee welcomes these two Clauses. They will fill gaps which needed filling and will be extremely useful to protect poor people who at present are going through very difficult times, either because one of the family has gone into the Services or for other reasons due to the war. I should like to put two points to the learned Attorney-General. If I understood him aright, he said that this was a declaratory Clause, in order to remove doubt. If that is so, I should like to ask why the word "shall" appears instead of "may" in Subsection (4), line 27. Earlier in this Debate he pointed out to us very eloquently that in Clauses of this kind you must always have the word "may" instead of "shall."

The Attorney-General

No, you must have the word "may" if the original Clause can only mean "may" and cannot mean "shall." I did not mean to suggest that you could never have "shall" in a declaratory Clause.

Mr. Hall

I knew that, but I could not refrain from putting that point. Further, I should like to ask whether it is possible, in the new Clause dealing with restrictions on the delivery of goods, to tighten up the law in order to save people who have goods on hire purchase from having those goods taken, as sometimes happens, when they are in the open? The owners of goods vary in their morality; some of them are excellent people, but others are only too willing to "get away with it" if they think they can do so by a little sharp practice. The Attorney General will know that owners of goods which have been sold on the hire-purchase principle will frequently take the goods if they find the goods in the open, in circumstances in which there can be no question of breaking or entering. Although it is illegal for them to do so, the hire-purchaser is put to a great deal of trouble, which, frequently, he cannot afford to take, in trying to get the goods back. I wondered whether by some simple procedure we could assist the ordinary working-class hire purchaser in such cases, which frequently arise in regard to motor cycles and, perhaps, poultry, and lead to great hardship. I hope the Attorney-General will look into the point and, if there is a prospect of helping people in that position, will put in a provision to do so.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.