CLAUSE 12.—(Special provisions as to inventions.) (Hansard, 11 October 1946)

§ Mr. Woodburn
I beg to move, in page 8, line 24, after "he," to insert: shall forthwith consider whether the invention which is the subject matter of the application in question is of importance for purposes of defence and. It might be for the convenience of the Committee to discuss this Amendment, and the succeeding Amendments to Clause 12 together. This first Amendment is to correct what might have been a weakness from the point of view of the inventor. Under the Bill as it stands the Minister will be able to prohibit an invention being used, and he might "freeze" it for a very long time. There is no requirement on his part to deal with it punctually or promptly and this Amendment lays upon the Minister the obligation that he— shall forthwith consider whether the invention … is of importance for purposes of defence … and inform the Comptroller-General of Patents, Designs and Trade Marks. The three immediately succeeding Amendments are largely consequential, but the last Amendment, namely to insert Subsection (4), deals with the question of compensation and it is under this Subsection that the Minister takes power to compensate the inventor for the work done in connection with his discovery. The right hon. Gentleman the Member for South Kensington (Mr. Law) put down an Amendment which proved to be very helpful, suggesting an improvement to the Minister's Amendment, and if he will regard the wording of the new Amendment proposed by the Minister, he will see that we have tried to embody his suggestion in giving that additional protection to the inventor so that— compensation shall not in any case be less than the amount of the expense reasonably so incurred, such amount (in case of dispute) to be settled by arbitration. We think that in a case of this kind there is justification for saying that it shall not be the Minister who will be the final 553 arbiter of what compensation is justifiable. Therefore in the case of work done, we have agreed that should the inventor not agree with the Minister, the inventor will have the right to appeal to arbitration.
The rest of it, of course, is the safeguarding of the rights of the Crown in regard to moneys paid which afterwards seem not to have been justified, and there is a certain element of possibility of recovery in these cases.

§ Mr. Law
I think that these Amendments to Clause 12, which is a very important Clause, are deserving of the support of the Committee. It is clearly of importance that inventors should be encouraged, that their applications should be dealt with promptly, and that, if they produce an invention which is in itself of value, they should receive compensation for it whether or not it is surpressed for reasons divorced altogether from the merits of the invention but concerned simply with questions of security.
As the Minister was good enough to point out, we had put down an Amendment to his original Amendment. It is still on the Order Paper but, of course, it is now rendered invalid because the Minister has incorporated it in his own Amendment. There is just one question I would ask the Minister arising out of that. Our purpose in putting down our Amendment was to ensure that if an inventor had produced something of value, and it was suppressed for reasons which had nothing to do with the merits of the invention, then the Minister should not necessarily be limited to paying out of pocket expenses but that, if he thought fit, and if it seemed desirable, a further payment should be made in regard to the invention beyond the payment of expenses as such. It seemed to us that unless there was some such provision, there would be a discouragement to inventors to do their best work. The Minister's Amendment says: Where on an application to the Comptroller General for the grant of a patent … any person who has … done work in con nection with the discovery or development of the invention concerned, shall be entitled to be paid such compensation in respect of that expense or work as the Minister may with the approval of the Treasury determine, and the compensation shall not in any case be less than the amount of expense reasonably so incurred, such amount (in case of dispute) to be settled by arbitration. 554 I am not quite clear what it is that is to be settled by arbitration. Is it simply the amount of out-of-pocket compensation that is to be settled by arbitration, or is it the amount of overall compensation to cover his out-of-pocket expenses and any additional reward there may be as well to be settled by arbitration?

§ Mr. Woodburn
Under the Amendment as now put forward, the question of any payment beyond the amount of expenses would be a matter of an ex gratia payment in the way of rewards to inventors, and would not be subject to arbitration. The only point which would be subject to arbitration would be the amount of expense so incurred. For example, you might have a person who indulged in the most elaborate organisation in order to produce a small invention. It might be a steam hammer to crack a peanut. Of course you would have to protect the public against being bound to pay the whole expense of the steam hammer. During the war a complaint came to me, when I was on the Select Committee, about a certain development which was being carried through on behalf of the Government where the person in charge had employed his whole family at very large salaries, presumably with the intention of charging them all up to the Government later on. That of course, would not be available for compensation under this Clause unless the arbiter also agreed that these were reasonable expenses.