HC Deb 05 December 1946 vol 431 cc602-24
Mr. H. Strauss

I beg to move, in page 17, line 3, to leave out "or refrain from doing."

We have now come to the Clause which, as I pointed out on Second Reading, makes it a criminal offence to forgive our debtors. But the implications of that rather startling fact will be more appropriate, as I am sure you would rule, Mr. Deputy-Chairman, on the Question that the Clause stand part of the Bill than on the Amendment which I am now moving. This Amendment is intended to make what is to be criminal conduct more clear than it is under the very wide words which we now have. These words make it criminal, not merely to do certain acts but to refrain from doing acts with intent. Now, when somebody does an act he is conscious of it at the moment he is doing it, and can consider the legality of what he is doing; but refraining from doing something even with stated intent, is something which can cover weeks or years. The prospect it holds out is most alarming and vague, when it is remembered that it is creating a criminal offence. Of course, there are many precedents for making it a criminal offence wilfully to neglect to do something which is a well known duty for somebody to do, or wilfully to neglect to do something after the person has perceived from a notice that he ought to do it. At the moment, I cannot think of any criminal offence as vaguely worded as this, where merely refraining from doing an act is made criminal in this way—and refraining from doing an almost unlimited number of acts.

It would be arguable, I suppose— although the prosecution might not like to take on the burden of proving intent— that a person might become liable to criminal penalties under this Clause if, because of laziness one night, he did not answer a letter. I do not know how far the Government wish this definition of this new criminal offence to go. This crime is committed if someone refrains from doing any act in order to secure that the receipt of certain payments should be delayed—merely delayed. Now, is he doing that or is he not, if, being a person not having great confidence in his debtor who ought to put his lawyers on to the debtor, or ought to issue a writ, he neglects to do so? It seems to me that the Clause as it stands is so far-reaching in the vague threats that it holds over people, and is so vague in the offences which it creates, that it is quite intolerable. I am very glad to see that the learned Solicitor-General is the Minister who is to reply, because I am certain he will refer us to such precedents, if any, as he can find. However, I hope he will not merely refer us to precedents, but will tell us that he agrees that these words, as they stand, really create an offence of quite intolerable vagueness; that it really does offend against the whole principle of our criminal law that a man should be made liable to criminal penalties, merely because he does not do something, when the something which he does not do is a thing which for centuries the Christian religion has actually suggested it is a virtue not to do.

I do not wish to labour the point, because I want to hear what, if anything, can be said in defence of these words. I hope that if the Government cannot accept our view—though I hope they can —at least they will say they will define accurately and precisely that which they wish to hit. If they say that a person offends if he refrains from doing, after he has received some notice, that which he ought to do, that would at any rate introduce some clarity. If they make criminal some wilful neglect of a duty which is defined, it will create some clarity. But simply to leave the words as they stand would be, I think, to pass legislation in this House which would be quite unworthy of a civilised people.

The Solicitor-General

The hon. and learned Gentleman has called attention to a Clause which, admittedly, is stringent. I will try to put before the Committee our reasons for thinking it necessary to have those words, and for thinking that we cannot do with anything less than those words. Suppose goods are consigned abroad, by a resident in the United Kingdom, with the result that a debt becomes due from the consignee of the goods to the consignor. Without words such as the words in this particular Clause there is nothing at all to stop the consignor, either from specifically waiving the payment of the debt—

Mr. Strauss

That is doing something.

The Solicitor-General

That is doing something—or, achieving precisely the same result by doing nothing. Now, the offence is refraining from doing something with intent. That is to say, before a person can commit an offence under Subsection (1) of Clause 24 he has to do something, or to refrain from doing something with intent; that is to say, he must, when he does or abstains from doing, have the intent of bringing about the mischief which the Clause is designed to prevent. I think hon. Gentlemen opposite, and I believe my hon. Friends, would accept at once the position that, suppose, in that case, the consignor deliberately did something, such as waiving the payment of the debt, which would have the consequence of preventing the currency being received in this country, even though the Clause is stringent there is justification for it. There is justification for making it an offence in a case like that for the consignor deliberately to waive payment of the debt. I feel hon. Members would accept that that would be justifiable.

If it is justifiable it does, I submit to the Committee, follow as a necessary consequence from that—it is logically a necessary consequence—that it should be equally an offence to do deliberately the same thing in another way; that is to say, if it is an offence to waive a debt, to write to the debtor and to say, "You need not pay," equally, it should be an offence not to send in the bill to him. The bill is not sent in to him for six months, a year, two years, three years or four years, with the intent that he should not pay the foreign currency to which the consignor is entitled. That is the justification which I put before the Committee in asking the Committee to approve what are admittedly stringent powers. The hon. and learned Gentleman the Member for the Combined English Universities (Mr. H. Strauss) said there would be cases in which considerable hardship would be imposed. He instanced the case of laziness in writing a letter. Suppose that were the case; suppose the consignor, in the case which I have instanced, did not write a letter, but did not write it because he was lazy, or because his bookkeeping methods were inefficient, or for one reason or another it slipped his mind. Clearly, he would not have committed an offence, because he would not have had in his mind the necessary guilty intent. In that connection I would particularly invite the attention of hon. Members opposite to the words which import the necessity of intent, and which appear in Subsection (1) at the top of page 17: shall do, or refrain from doing, any act with intent to secure"— If the Clause really made it an offence by inadvertence to fail to do something, then I would concede at once that the hon. and learned Gentleman had made out his case, but the qualification here is that there must be a refraining with intent. In other words, there must be a deliberate act of abstention.

8.30 p.m.

The hon. and learned Gentleman then may say, "Surely, sometimes it may be desirable, for a perfectly legitimate object, deliberately and with intent, to do something which will have the result of postponing payment of the debt." That, of course, may come about. If that be the case, then those would be the circumstances in which the Treasury would very readily give permission for the debt to be allowed to drag on. That is just the case. So that the result comes about that a person only commits an offence under the words "refrain from doing" when he deliberately abstains from doing something necessary to get his debt, intending to bring it about that he does not get the debt, and having no valid excuse for so doing. If he has any valid excuse at all he will certainly get permission straight away from the Treasury not to do that very act.

Mr. H. Strauss

Will the hon. and learned Gentleman just answer these two points? Will he indicate to us a precedent for these exact words? Secondly, will he indicate whether he is now submitting to the Committee that "refrains from doing" is equivalent to saying "wilfully neglects to do"?

The Solicitor-General

Yes, I do say that. To refrain from doing something with intent to bring something about is the exact equivalent of deliberate abstention from doing something it is a duty to do.

Mr. H. Strauss

But the precedent?

The Solicitor-General

If the hon. and learned Gentleman looks at the Finance Act he will find words which are similar up and down the Finance Act. Not the same words. I cannot give him any exact precedent. I am afraid I cannot respond to his invitation to give him identical words. But there are expressions used which are not wholly dissimilar. That is the case I make for these admittedly stringent powers.

I want to supplement that by making two other observations. In many cases— I do not say in all cases—but in many cases there will be provisions under the contract providing for delay in payment. Payment may be due in six months or nine months, and there will be terms of credit, and so on. Of course, this Clause does not require the creditor to demand payment before payment is due under the terms of the contract. That is quite clear. He cannot seek to advance the date of payment. In normal commercial transactions there are terms of credit allowed, longer or shorter. There is express provision in the first proviso in the Clause: 'Nothing in this subsection— (i) shall, unless the Treasury otherwise direct, impose on any person any obligation … to procure the payment … at an earlier time than is customary in the course of that trade or business. There is that safeguard, for what it is worth.

I frankly confess the powers are drastic, but, after careful consideration, and for the reasons I have endeavoured to put before the Committee, we have come to the conclusion that nothing less would really be sufficient to enable us to operate this. One is always faced with this difficulty, that if one takes powers that are not adequate one makes a mockery of the whole thing; and yet, if one does not have power to do what we set out to do, it means that the honest trader is penalised, and that the dishonest trader, quite ready to take advantage of any position he can turn to his advantage, profits at the expense of the honest trader. Having set out to impose this control we have thought, for the reasons I have given, that this is the way we should propose to do it, in order to operate it efficiently; and that we could not operate it efficiently without taking these powers. I ask the hon. and learned Gentleman to say his Amendment should not be pressed.

Mr. Assheton

We are much indebted to the Solicitor-General for the explanation he has given us with regard to this Amendment, and I think he could make his task easier by making a little concession; he was good enough to say that in his view the words "wilfully neglect to do" have the same meaning as "refrain from doing." That would at any rate be somewhat better. I do suggest that the words we have here are really creating a kind of offence which is intolerable, an offence merely to refrain from doing something. In the case of collecting a debt, I can recollect many occasions in the past when people have quite innocently failed to collect debts. I remember one case of a shoemaker who did not send in a bill for 17 years. My own doctor sends in his bill most reluctantly; there is nothing criminal about that, there is nothing wrong about that. But they are refraining from doing something which, in this case, might be an offence.

The Solicitor-General

That is not an offence.

Mr. Assheton

I suggest that it would be under the terms of this Clause if it were the case of a doctor who was refraining from collecting a debt from a client who was on the other side of the Atlantic. I hope that before we come to the next stage the learned Solicitor-General will see if he can do something to make this Clause better.

Mr. J. Foster

I think that one can agree with most of what the learned Solicitor-General has said, namely, that certain acts, the instances which he gave, should be stopped by this Clause. It is the object of this Clause to stop the consignor refraining, with intent to delay payment, from doing something which it is his duty to do. The mischief of this Clause is, I think, in the drafting. It is difficult to summarise it, but I think that it is reasonable that, if a person shall do, or refrain from doing, any act with intent to secure—who deliberately does an act with intent to secure—delay in payment, he should be prosecuted and convicted. It is also reasonable that any man should be prosecuted for refraining from doing any act which it is his legal or commercial duty to do. That is the effect of what the learned Solicitor-General said.

The Solicitor-General

The Clause makes it a duty.

Mr. Foster

No, that is where the draft-in? of the Clause does not fit in with what we think is reasonable. I would ask the learned Solicitor-General to consider the point I am making, if I am making it clear, and I hope I am. The Clause says that a man can be prosecuted if he refrains from doing an act which it is not his duty to do. Let us take an absurd instance, but one which will fit in. The consignee who owes the consignor some money writes to him and says, "I am in difficulties about paying you, but I shall be in Milan next Thursday, and will have some money with me. If you will meet me there I will give the money to you." The consignor may not go to Milan and so payment would be delayed. He refrains from going. The Solicitor-General could say he should be prosecuted because he ought to be bound to go to Milan. In other words, the Treasury is imposing a duty on persons who are due to receive money and who, for one reason or another, would like to delay payment, or who postpone doing something, or do not do a number of acts which lazy people or ignorant people do not, in any case, have to do.

In my submission, the way the Clause should be drafted is so that it shall mean that a man shall do any act, or shall not refrain from doing any act, which it is his legal or commercial duty to do, or which is his legal duty, and which is in accordance with commercial practice. That would fit in exactly with the explanation the learned Solicitor-General gave us. The learned Solicitor-General talks about an act which it was his duty to do, and in my submission this allows a man to be prosecuted for not doing an act which it is not his duty to do.

The Solicitor-General

Would the hon. Gentleman be satisfied if the Clause contained words like "It shall be the duty of everybody to take reasonable steps to get in his debts?"

Mr. Foster

Yes.

The Solicitor-General

That is exactly what the Clause does say.

Mr. Foster

With respect, it is not, because if the debtor, say in Italy, puts up some wild or fantastic scheme which will enable the consignor to get his money, and if he refrains from taking part in that scheme, with intent to delay payment—

The Solicitor-General

With intent.

Mr. Foster

Yes, but I am talking about taking a step, or not taking a step, which I say is not reasonable. Suppose the debtor says that if the consignor puts on a paper hat and walks down Bond Street in it he will get his money, and if the consignor refrains from doing that, and prefers to delay payment, he is liable to prosecution, and is taken to court. There the prosecution will say that they have a letter from the debtor in Milan saying that the consignor was to walk on Thursday morning with a paper hat on down Bond Street, and a letter from the consignor to one of his friends saying that he would not do that but would like to delay payment. He is prosecuted for refraining from doing an act which it is not his legal or commercial duty to do. I ask the Solicitor-General to look at the Clause from the point of view I am taking at the moment. Perhaps one can never see that fallacy in one's own arguments, but at the moment I cannot see that the man who is asked to wear a paper hat and walk down Bond Street in it has any defence at all if he does not do so, although I agree it is an absurd illustration.

The Solicitor-General

The result of the hon. Gentleman's argument would be that, if the debtor said to the creditor, "If you will stand on your head for three hours in the middle of Piccadilly I will pay the debt," and the creditor said, "No, I will not do that," he would be committing an offence. That is quite obviously absurd. If he refuses to stand on his head in the middle of Piccadilly for three hours he is not refraining from doing an act which it is his legal or commercial duty to do because he does not want payment; on the contrary, he would want the debt to be paid, but would refrain from doing that act in order to avoid making himself ridiculous, and in order not to comply with a ridiculous request.

Mr. Foster

But suppose he writes to a friend, "I have not the slightest objection to walking down Bond Street wearing a paper hat, because it would amuse my children, but I am not going to walk down Bond Street wearing a paper hat because if I do not it will delay payment, and I do not mind that a bit." In the case suggested by the learned Solicitor-General, if he refuses to stand on his head in Piccadilly because he does not want to look ridiculous, naturally he is not committing an offence. But if, as I have suggested, he writes a letter saying that he does not mind doing it but will not do it because he does not want payment immediately, what is the position then?

Mr. Callaghan

I hesitate to interfere in a legal battle, but to my simple lay mind it seems to me that the whole point is the intention of the refusal, "I want to delay payment." That seems to me to be the operative phrase; it is morally wrong for him to do so. If he says, "I refuse to walk down Bond Street in a paper hat because I think I shall look a fool, and therefore I am not going to do it." it is an entirely different proposition.

Mr. Foster

A lot of people do things which are morally wrong but are not convicted of offences, and in the criminal law we have found that it is very undesirable that whatever is morally wrong should be made a criminal offence. One must take into account that moral turpitude is often not a criminal offence. I still challenge the learned Solicitor-General to deal with the position of the man who may write, in his own handwriting, "I am not going to walk down Bond Street in a paper hat on Sunday morning because I want to delay payment, not that I should not otherwise be very pleased to do it, because I do not think I should look very ridiculous and it would amuse my children whose birthday it is."

Mr. Scollan (Renfrew, Western)

Would the hon. Gentleman please explain what kind of consignor he visualises who would send goods to the Continent, or to any other country, with an agreement that the consignee would be able to place restrictions on the payment in the manner he has just outlined?

8.45 p.m.

Mr. Foster

Admittedly the consignee is in default, and this is a more or less absurd instance, but suppose the consignee says to the consignor, "I am sorry I cannot pay when I should, but I will pay you in Milan next Monday morning. I shall have some money there then, and if I slip it to you quickly I shall not put it on the races that afternoon." Or he may say, ''I will meet you in Milan because I want to ask you a favour." Very often debtors, all over the world, in a sense blackmail their creditors by saying, "I will not pay you unless you do something extra." Suppose the something extra is a social service? The debtor may say, "I will pay you tomorrow if you will meet me in the street and introduce me to so-and-so"—or do this favour or that, possibly give some advice. If the man refrains from doing it, with intent to delay payment, if he says that in ordinary circumstances he would agree but in this case he does not mind delaying payment, he has committed an offence.

Naturally the deliberate doing of an act with intent will be an offence in any case, and the man who does it with intent to avoid payment should be prosecuted and convicted, but in the proposed form of words a man who refrains from doing an act only commits an offence if he refrains from doing one which it is, to put it shortly, reasonable for him to do. If it is unreasonable he can take advantage of its unreasonableness, even though his object is to delay payment.

Mr. Eccles

I am afraid I was not here when the argument on this Amendment opened—

Mr. Turner-Samuels

You were lucky.

Mr. Eccles

Not at all. Listening to the hon. and learned Gentleman's reply, I have come to the conclusion that I am a criminal, and I want to ask whether that is so. I was on the staff of His Majesty's Embassy in Lisbon at the time France fell, and a great many refugees passed through Lisbon at that time. The members of the staff of His Majesty's Embassy were constantly asked—and indeed they had no choice but to agree—to lend money to people in the most distressing circumstances. I have written, and I shall go on writing, letters to certain of these people, telling them that they need not pay me back. I do not care in the least what is put into this Bill, I have no intention whatever of collecting money from people to whom I lent it if I think they are really not in a position to pay, and remembering the distress they were in when I lent it to them. It does not concern myself only; I think almost every British citizen in Lisbon at that time did the same thing. Are we criminals if we write letters—which I hope all my friends who did the same thing will continue to do—saying that we let people off certain debts?

Mr. Birch

I would like to expand the point put by my hon. Friend the Member for Chippenham (Mr. Eccles). The learned Solicitor-General talks about refraining from doing things which it is one's commercial duty to do, the assumption being that it is always one's commercial duty to put the screws on anybody who owes money to make him pay up as quickly as possible. I do not believe that is true. There are many cases where it pays, and is in fact one's commercial duty, to husband a debtor, as it were, and give him time to get on his legs. For instance, I have no doubt that in the learned Solicitor-General's younger days his tailor had to wait a certain time before he got paid, but that tailor may well have appreciated that the learned Solicitor-General would rise to wealth and power, and therefore it would pay him, and would be his commercial duty, not to put the screws on him and take him into the county court, but to wait. It appears to me that one of the troubles about this Clause is that it puts the obligation on someone to act against his better commercial judgment. Again and again, it may be that by waiting and showing sympathy you will get the money and a good deal more business out of a man. If you put the screws on him you will ruin him and lose his custom, and thereby be doing something which is the very reverse of your commercial duty and commercial interest.

9.0 p.m.

Mr. C. Williams

I have looked at this, and I have been amazed how close the lawyers are to each other on this matter. I have been extremely interested, and I wonder whether the Solicitor-General could not say that between now and the Report stage he will once again look into this matter. I do not for one moment suggest that I can put the argument as clearly as my hon. Friend the Member for Northwich (Mr. J. Foster), but it seems to me that under this Subsection, with these words omitted we shall not necessarily accomplish what either side wishes. I gather that the purpose of the Government is that where there is a clear duty to collect a debt it shall be enforced that you collect the debt. As my hon. Friend the Member for Flint (Mr. Birch) said, we are really pressing people, whether it is in the interests of trade or not, at once to become debt collectors. It is being enforced on them to become debt collectors, whether it is in the general interest of trade or not, and if that is the case, it seems to me that the Government have not thought this out as fully as they might. The Government are out to rope in those of criminal intent, but not to rope in those who are genuinely desirous of increasing our foreign trade. That being the position, and having listened to the whole of this Debate with great care, I would ask the Government whether in the circumstances they are not enforcing a lot of people to collect debts unwillingly. It seems to me that we need some clearer definition which will enable it to be laid down quite simply, that where it is the duty of the individual to collect these debts and it is expedient in the widest national sense, he shall do so from the point of view of trade as a whole. It should not be beyond the wit of the Treasury to do this, and if the Solicitor-General can give this assurance, we can then dismiss this Amendment.

Mr. H. Strauss

I think that the point pressed by previous speakers about giving extra time is extremely important. What I wish to put to the Solicitor-General is that under the Clause as it stands creditors are constantly to be put in the most difficult position. Suppose that a creditor can collect today three-quarters of his debt, and that possibly by waiting a month he could collect the whole. He will not know whether by giving time he may not be refraining from doing an act within the mischief of the Clause. I think that the Solicitor-General ought to have been struck by the fact that he cannot find a precedent for these words. I accept what he says that in certain Finance Acts he finds provisions which are not very different. But I think he will find them sufficiently different to prevent him from saying with any certainty that he has the right words here. He told me that in his view these words were equivalent to "wilfully neglects to do." Those words would be better in my view than the words now in the Bill. I agree, however, with my hon. Friend the Member for Northwich (Mr. J. Foster) that the real confusion is introduced into this Clause by combining the "intent" with two separate things, namely, the doing and the refraining from doing. My impression is that the Clause would have to be recast to make illegal the doing of the act with this intent, and to make illegal also refraining from doing acts which it is a duty to perform. Alternatively, the Treasury could give some sort of notice to the man that he is required to take some action, and, if he refrains after that, he could be guilty or they could take over the debt due to him. It seems to me it is a hard thing that he can be guilty of an offence if he merely refrains from doing an act which he does not feel it his moral duty to perform: indeed he may feel it is his moral duty to do the opposite. Nor is there any clear legal duty. For these reasons I should be prepared to advise my hon. Friends not to press this Amendment if we obtain some clear indication from the Solicitor-General that he is going to put in better words. Unless the Solicitor-General can give such an undertaking my view is that we should divide.

The Solicitor-General

Hon. Members opposite have asked me to take back this Clause and reconsider it. There is always a great temptation to say that one will do that, but I do not think it is fair, when I know that this thing has been gone through over and over again. We have considered it with the greatest of care, as we naturally would in taking powers which are drastic. I have listened with interest to the arguments which have been adduced —and they have been weighty—and they will be carefully considered, as we always consider arguments which are seriously put forward. The hon. and learned Member for the Combined English Universities (Mr. H. Strauss) suggests the words "wilfully neglect." What improvement would that be? The position would be the same with a creditor who goes out of his way not to do something with the intention that he shall avoid getting in a debt due to him. The safety valve is permission of the Treasury. The hon. Member for Chippenham (Mr. Eccles) asked whether he would have committed an offence. The answer is that in the case of specified currency he would have to get permission of the Treasury if he went out of his way to forgive debts.

The view the Government take is that in the present condition of the world, and in the foreseeable future, it is their duty to insist that persons resident in this country shall get in foreign currency which is due to them in certain cases. That is why we take this power. I would willingly say that we will take the Clause back to see whether we could improve it, but for the fact that it has already been considered with the greatest possible care. I hope Members opposite will accept that from me.

Quite frankly, I cannot give anything like an exact precedent; it is impossible to do so. I could investigate the case to see if I could find the nearest thing to a precedent, but I cannot give the undertaking for which I was asked. We thought of the arguments which have been adduced be fore we came to the House to ask the House to accord us these powers. We have asked for drastic powers, and we rely on Clause 31, which is one of the most important in the Bill, as it is an exemption Clause. We shall use it in such a way as to insist on payment only in cases where it is reasonable and proper to do so. What we want to avoid is creditors going out of their way to prevent foreign currency which is due to them being collected in

this country. We will use the powers given under this Clause in such a way as to prevent that, and nothing else.

Mr. C. Williams

If this matter had been gone into as fully as the hon. and learned Gentleman says, surely there must be a precedent for it. I have never heard the Government put forward a matter of this sort, and say it has been carefully considered when they have not been able to give an excellent precedent for it.

Mr. Assheton

In view of the very un satisfactory reply which the hon. and learned Gentleman has just given, we have no alternative but to divide on this Amendment.

Question put, "That the words pro posed to be left out stand part of the Clause."

The Committee divided: Ayes, 267; Noes, 84.

Macpherson, T. (Romford) Rees-Williams, D. R. Thurtle, E.
Mallalieu, J. P. W. Reid, T. (Swindon) Tiffany, S.
Mann, Mrs. J. Rhodes, H. Tolley, L.
Manning, Mrs. L. (Epping) Richards, R. Tomlinson, Rt. Hon. G.
Marquand, H. A. Ridealgh, Mrs. M. Turner-Samuels, M.
Mathers, G. Robens, A. Ungoed-Thomas, L.
Medland, H. M. Roberts, Emrys (Merioneth) Usborne, Henry
Mellish, R. J. Roberts, Goronwy (Caernarvonshire) Vernon, Maj W. F.
Messer, F. Roberts, W. (Cumberland, N.) Viant, S. P.
Middleton, Mrs. L. Rogers, G. H. R. Wadsworth, G.
Mikardo, Ian Royle, C. Walkden, E.
Mitchison, Maj. G. R. Sargood, R. Walker, G. H.
Montague, F. Scollan, T. Wallace, G. D. (Chislehurst)
Morgan, Dr. H. B. Scott-Elliot, W. Wallace, H. W. (Walthamstow, E.)
Morris, P. (Swansea, W.) Segal, Dr. S. Warbey, W. N.
Murray, J. D. Shackleton, Wing-Cdr. E. A. A. Webb, M. (Bradford, C.)
Nally, W. Sharp, Granville Weitzman, D.
Nichol, Mrs. M. E. (Bradford, N.) Shawcross, C. N. (Widnes) Wells, W. T. (Walsall)
Nicholls, H. R. (Stratford) Silverman, S. S. (Nelson) Westwood, Rt. Hon. J.
Noel-Baker, Capt. F. E. (Brentford) Simmons, C. J. White, H. (Derbyshire, N.E.)
Noel-Buxton, Lady Skeffington-Lodge, T. C. Whiteley, Rt Hon. W.
O'Brien, T. Skinnard, F. W. Wigg, Col. G. E.
Oldfield, W. H. Smith, Ellis (Stoke) Wilcock, Group-Capt. C. A. B.
Oliver, G. H. Smith. S. H. (Hull, S. W.) Wilkins, W. A.
Paling, Rt. Hon. Wilfred (Wentworth) Snow, Capt. J. W. Willey, F. T. (Sunderland)
Parkin, B. T. Sorensen, R. W. Willey, O. G. (Cleveland)
Paton, Mrs. F. (Rushcliffe) Soskice, Maj. Sir F. Williams, D. J. (Neath)
Paton, J. (Norwich) Sparks, J. A. Williams, J. L. (Kelvingrove)
Pearson, A. Stamford, W. Williams, W. R. (Heston)
Peart, Capt. T. F. Stephen, C. Williamson, T.
Perrins, W. Stross, Dr. B. Willis, E.
Piratin, P. Swingler, S. Wilmot, Rt. Hon. J.
Poole, Major Cecil (Lichfield) Symonds, A. L. Woods, G. S.
Popplewell, E. Taylor, H. B. (Mansfield) Wyatt, W.
Porter, G. (Leeds) Taylor, R. J. (Morpeth) Yates, V. F.
Proctor, W. T. Taylor, Dr. S. (Barnet) Young, Sir R. (Newton)
Pursey, Cmdr. H. Thomas, I. O. (Wrekin) Zilliacus, K.
Randall, H. E. Thomas, John R. (Dover)
Ranger, J. Thomson, Rt. Hn. G. R. (Ed'b'gh, E.) TELLERS FOR THE AYES:
Rankin, J. Thorneycroft, Harry (Clayton) Mr. Michael Stewart and
Mr. Hannan.
NOES.
Agnew, Cmdr. P. G. Gomme-Duncan, Col. A. G. Neven-Spence, Sir B.
Aitken, Hon. Max Grant, Lady Noble, Comdr. A. H. P.
Assheton. Rt. Hon. R. Gridley, Sir A. Pickthorn, K.
Astor, Hon. M. Grimston, R. V. Ponsonby, Col. C. E.
Baldwin, A. E. Hannon, Sir P. (Moseley) Prior-Palmer, Brig. O.
Beamish, Maj. T. V. H. Hare, Hon. J. H. (Woodbridge) Rayner, Brig. R.
Bennett, Sir P. Hinchingbrooke, Viscount Renton, D.
Birch, Nigel Hogg, Hon. Q. Ross, Sir R.
Bossom, A. C. Hollis, M. C. Shepherd, W. S. (Bucklow)
Bower, N. Howard, Hon. A. Smiles, Lt.-Col. Sir W.
Braithwaite, Lt.-Comdr. J. G. Hurd, A. Smith, E. P. (Ashford)
Bromley-Davenport, Lt.-Col. W. Lambert, Hon. G. Smithers, Sir W.
Buchan-Hepburn, P. G. T. Lancaster, Col. C. G. Stanley, Rt. Hon. O.
Bullock, Capt M. Legge-Bourke, Maj E. A. H. Stoddart-Scott, Col. M.
Butcher, H. W. Lennox-Boyd, A. T. Strauss, H. G. (English Universities)
Carson, E. Lindsay, M. (Solihull) Stuart, Rt. Hon. J. (Moray)
Clarke, Col. R. S. Linstead, H. N. Tay'or. C. S. (Eastbourne)
Clifton-Brown, Lt.-Col. G. Lloyd, Selwyn (Wirral) Vane, W. M. F.
Conant, Maj. R. J. E. McCallum, Maj. D. Walker-Smith, D.
Cuthbert, W. N. Macdonald, Sir P. (Is. of Wight) Ward, Hon. G. R.
Dodds-Parker, A. D. Mackeson, Brig. H. R. Watt, Sir G. S. Harvie
Drayson, G. B. Maclean, Brig. F. H. R. (Lancaster) Webbe, Sir H. (Abbey)
Drewe, C. Maitland, Comdr. J. W. Wheatley, Colonel M. J.
Eccles, D. M. Manningham-Buller, R. E. Williams, C. (Torquay)
Erroll, F. J. Marlowe, A. A. H. Williams, Gerald (Tonbridge)
Foster, J. G. (Northwich) Marples, A. E. Willoughby de Eresby, Lord
Fraser, Sir I. (Lonsdale) Maude, J. C.
Gage, C. Mellor, Sir J. TELLERS FOR THE NOES:
Glossop, C. W. H. Morrison, Maj. J. G. (Salisbury) Sir Arthur Young and
Major Ramsay.
The Deputy-Chairman

It would be of advantage, I think, if we transposed the next two Amendments in page 17, line 7, and I called first the Amendment in the name of the right hon. Member for West Bristol (Mr. Stanley).

Mr. Stanley

Could not the two Amendments be discussed together?

The Deputy-Chairman

I intend to call first the Amendment in the name of the right hon. Member for West Bristol, but the two Amendments can be discussed together.

Mr. Stanley

I think it would be more convenient if you called first the Amendment in the name of my hon. and gallant Friend the Member for Holderness (Lieut.-Commander Braithwaite) and allowed that Amendment and my Amendment to be discussed together.

Mr. Glenvil Hall

For the sake of clarity, Mr. Beaumont, to which Amendments are you referring?

The Deputy-Chairman

I am referring to the next two Amendments on the Order Paper below the one we have just taken —the Amendments in the names of the hon. and gallant Member for Holderness and the right hon. Member for West Bristol, in page 17, line 7. These Amendments have been printed in the wrong order, and, therefore, I propose to call first that in the name of the right hon. Member for West Bristol. If the Committee wishes, the two Amendments can be discussed together.

Lieut.-Commander Braithwaite

I beg to move, in page 17, line 7, after "delayed," to insert "for a period exceeding three months."

I will, as you sugggested, Mr. Beaumont, discuss together this Amendment in the name of my right hon. Friend, and the Amendment in my name, because we on this side of the Committee are anxious to assist the Chancellor in achieving his target for tonight. I will endeavour to do so without venturing into either Bond St. or Piccadilly, both of which highways are of dangerous reputation to the guileless and innocent When we were discussing the last Amendment, the hon. and learned Gentleman the Solicitor-General endeavoured, with his soothing words, to remove the impression of harshness which the Clause gives in its present wording. The object of these two Amendments is perfectly simple. It is to make it possible for a debt to stand over for a period of three months without pressing for immediate payment. I do not think it is necessary to repeat the arguments already put. The chief one is that it is often bad business to keep pressing a consignee to pay. We are endeavouring to introduce by this Amendment a rather less harsh method of seeking payment.

9.15 p.m.

The Solicitor-General

The objection to the insertion of the words proposed would be that it would make it quite easy to evade control by allowing successive periods of less than three months. It will be perfectly possible if these words were inserted in the Clause for a creditor to allow two months and when those two months came to an end to allow another two months and so on ad infinitum, thus postponing the debt for ever. The Amendment will completely nullify control, and for this reason I would ask the Committee to reject it.

Mr. Stanley

Might I appeal to the Chancellor of the Exchequer to give this matter further consideration? I accept the Solicitor-General's argument that this Amendment in its present form is not acceptable, because it will go further than intended. All we want—and I think it is a point worth considering—is some little laxity given to an exporter, say, six weeks or six months or whatever brief period would be dictated by the nature of his business. If he were forced to seek a longer delay he would be able to do so with the permission of the Treasury. It does not seem that within such a short period the Treasury would really suffer very much.

Mr. Glenvil Hall

I should like to say straight away that that is exactly what happens. All this Clause does is to operate the law of what one might call showing due diligence. So long as due diligence is shown no one is going to be pressed to exact times or be squeezed into certain limitations

Lieut.-Commander Braithwaite

What the Financial Secretary has stated entirely justifies us in putting this Amendment down. He has—and not for the first time in this Bill—shown that a Clause meant something entirely different from his own interpretation. However, his words are on record to be studied and in the interests of progress, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Howard

I beg to move, in page 17, line 21, to leave out Subsection (2).

The object of moving this Amendment is to get an explanation of one minor and two rather more important points in this Clause. The minor point is that towards the end of the Clause the Treasury obtains the right to receive the currency or payment while it does not have the right to receive part. The point is that while the Treasury can get the right to take the whole of any sum it would appear from the words in the Subsection that it cannot take only part of the amount. That is the minor point, and it should be borne in mind that on some occasions it might be necessary to have the right to receive only part of what is due rather than the whole.

The two points of much greater significance are these. First, there is this apparently new right of assigning to the Treasury which appears to amount to the right to confiscate any payment or exchange which arises. That does seem to require some explanation. The third point arises from the first line of Subsection (2), which reads: where a person has contravened the provisions". At what point has contravention taken place? Is it clear that contravention has not taken place until a court of law decides that it has, or can this be interpreted to mean that the Treasury has the right to decide whether contravention has in fact taken place? The purpose of moving this Amendment is to obtain some explanation on these points.

The Solicitor-General

With regard to the third question asked by the hon. Gentleman, the provision applies when there has clearly been a contravention, even though that has not been decided by a court of law. On the second point about the Treasury not having power to direct part of a debt to be assigned, the greater includes the less, and if it has the power to direct that the whole shall be assigned, that also includes a part. The other point made by the hon. Gentleman was that this came very close to confiscation. However, if the hon. Gentleman will look at Clause 27, Subsection (2), he will see that the Treasury, if it does exercise its rights, is under an obligation to pay over the amount which it receives upon a disposal to the person to whom the direction is assigned. Therefore, it is not really confiscation. The Treasury can direct that the assets shall be assigned to the Treasury, but has to pay over the proceeds realised from the disposal.

Mr. J. Foster

I do not know whether I interpreted the Solicitor-General correctly, but I understood him to say that contravention might occur without conviction in a court of law. That seems to me very wrong in principle but, of course, we are assuming a case where the Treasury wrongly think that there has been a contravention. They then enforce their right to the securities or the goods, and under Clause 27, Subsection (2), they pay over to the person concerned the net proceeds only. But suppose they had done it in a more expensive way. The person in question, who has not contravened the provision—finds his goods realised through more expensive brokers, or on a falling market—after all, the Treasury can play about with these goods —and although innocent he finds that he has suffered a financial loss. Are the Treasury prepared to reimburse an innocent man for such a loss? The same kind of thing arose when we were discussing an agricultural Measure the other day where a man who had offended against certain orders in the agricultural world was to have his property seized. The Undersecretary on that occasion gave us an assurance that an innocent man would not suffer. I think we should have a similar assurance here.

The Solicitor-General

If the Treasury purported to give a direction when there had not in fact been a contravention, the direction would be null and void and the person against whom it was given could ignore it entirely.

Mr. Dalton

It would be a good defence.

The Solicitor-General

Yes, it would be a good defence. With regard to the reimbursement of any loss that should be a matter of arrangement, and we will certainly bear in mind what the hon. Gentleman says.

Mr. J. Foster

Because "A" has been guilty of a contravention the direction might be given to another person—who is not the offender—and this places all third parties in a very difficult position. The person who receives the direction does not know whether "A" has in fact contravened or not It is not for him to inquire whether or not "A" is guilty, and he undertakes a very great responsibility in contravening a Treasury recommendation. On the other hand "A" cannot refuse to pay, because the direction is not given to him. So, we have two people; "A" contravenes, and "B" gets the direction. The direction is wrong, because the Treasury are mistaken. They may be mistaken, upon what they call reliable evidence, and no blame attaches to them. "B" has to do what the Treasury says, and "A" loses money. That, I think, is an unfortunate result.

The Solicitor-General

The position would not arise in fact, because the direction would be given only in a clear case. What the hon. Gentleman has said about loss will be taken into consideration.

Mr. Birch rose—

The Chairman

I think the Committee are prepared to come to a decision.

Mr. Birch

I think I can help to dispose of this question of property being assigned to the Treasury, and if we get a proper answer it will dispose also of Amendments to other Clauses and to points which might be raised on Clauses 26 and 27. I would like to know in what circumstances it is contemplated that this power will be used. Secondly, the right hon. Gentleman said that it was quite all right because there is a provision in Clause 27 which meant that the Treasury paid over what they took. At the beginning of Clause 27 these words appear: Under the preceding provisions of this Part of this Act. In actual fact, the power is already taken in Clause 2 (5).

It does not appear, as one reads the Clause, that it would apply to the first part of the Bill. Can we be told exactly why the power is taken, and what the mechanism is going to be? To shorten the thing still more, I would ask why the Treasury has power to take goods over without any charge or mortgage? How is this to be done? The answer to that might enlighten us on other points we have in mind.

The Solicitor-General

I hope that I can dispose of all the points which the hon. Gentleman has mentioned. The power under Clause 27 to direct an assignment to the Treasury, and a vesting and a realisation, and the obligation to pay over the proceeds of the realisation, relate, as the hon. Gentleman says, to the Clauses in Part V. That Part includes Clause 24. It also relates to Clause 26, which is another Clause which deals with the infringement of a duty imposed by the Bill

That being so, what happens, when there is a clear contravention, is that a direction will be given. In the event of it being necessary, goods will be disposed of and the proceeds paid over to the person from whom they were taken. I hope that that answers what the hon. Gentleman asked with regard to goods being vested free of any encumbrance. The charges of the encumbrancer would remain against the proceeds of the recovery and he would be able to enforce them against the proceeds accordingly. The Treasury pay as a matter of administrative arrangement.

Amendment negatived.

Motion made, and Question proposed. "That the Clause stand part of the Bill."

Mr. Eccles

I cannot let the Clause go without giving it as my personal view that it is a thoroughly bad thing to put on the Statute Book a provision which makes it criminal to forgive a debt. On the Second Reading my hon. Friend the Member for the Combined English Universities (Mr. H. Strauss) pointed out that that is contrary to the Christian religion. [Laughter.] It certainly is. I deplore the possibility that somebody who forgives somebody else a £10 debt may be regarded as a criminal under the Bill. I hope that provision goes out.

Question put, and agreed to.

Clause ordered to stand part of the Bill.