§ The Solicitor-General
I beg to move, in page 3, line 24, after "Act" to insert:and not being an assignment in pursuance of a requirement imposed by the landlord.This is an Amendment which I move in order to enable effect to be given to a proposal made by an hon. Friend on the Committee stage that, in the event of a tenant keeping a brothel, or using premises for immoral purposes, certain provisions of Section 5 of the Criminal Law Amendment Act should nevertheless 287 remain in operation. Section 5 of the Criminal Law Amendment Act, 1912, gives the landlord the right, where the occupier has been convicted of knowingly allowing the premises to be used as a brothel, either to require an assignment of the tenancy to some person approved by the landlord, or, if the assignment does not take place within three months, to terminate the tenancy.
If the landlord gives notice that he requires the assignment to be made to a new tenant of whom he approves, it obviously is not reasonable that he should also have the right to determine the tenancy because of that assignment. As Clause 3 (1, a) at present reads it would give the right to terminate the tenancy in the event of a new assignee of whom the landlord approved coming into the property. Obviously that would be most unjust to the new assignee. Inasmuch as Section 5 of the Criminal Law Amendment Act, 1912, will still be operative and is not interfered with by the provisions of this Bill, we think it desirable that assignments at the direction of the landlord acting under his rights under Section 5 of the 1912 Act should not give a right to a landlord to terminate the lease as a whole.
§ Amendment agreed to.
§ Mr. Powell
I beg to move, in page 3, line 25, to leave out "every," and insert "the whole or any."
If we look at the two paragraphs of this subject we see that the landlord may determinate the tenancy in two different circumstances. The first relates to assignment and the second to sub-letting. To produce this power of the landlord to determine the tenancy by assignment it is only necessary that the tenant should have assigned part of the property of which he is the tenant, whereas in the case of sub-letting it is necessary in order to produce that effect that he should have sub-let the whole of the property. This Amendment relates to this difference between the two approaches in respect of assignments and sub-letting. It goes upon the view that in each case it should be sufficient that the tenant has found himself in a position to dispose, whether it be by assignment or sub-letting, of part of the property he occupies to enable the landlord to terminate the tenancy. 288 The main ground of the Bill is to protect tenants in the occupation of house room which they need for themselves and their families and the Government, to judge from paragraph (a) of the subsection, clearly feel that if a tenant finds himself in a position to do a deal in respect of part of the property and to assign it he ought not to enjoy the protection of this part of the Bill at all. The question is whether that should not also apply to sub-letting. In either case the tenant is obtaining a benefit from house room or a part of the property which he himself no longer requires and he is obtaining, whether in the form of a premium upon assignment, or in the form of rent obtained from the sub-tenant, a benefit at the landlord's expense from the extension of two years which this part of the Bill creates.
Why should there be the difference between the two methods whereby he obtains that advantage, namely, by assignment or by sub-letting? It was argued on behalf of the Government that if sub-letting is placed in the same position as assignment, tenants will not sub-let but will say, "If we cannot get the benefit of the two year's extension by sub-letting we will not sub-let at all" and will continue to occupy the whole of the property and, possibly, housing space for an extra family would be withdrawn.
That is an argument, as far as it goes, but it only reinforces the contention, which has several times been made from this side of the House, that the Government have been wrong in extending protection to property as a whole instead of extending it to the part actually occupied by the tenant. Had they done that there would have been no difficulty arising and no necessity for the distinction to which this Amendment draws attention. It cannot be argued that it is impossible to extend protection to part only of the property held in the tenancy because it is assumed by paragraph (a) that part only can be assigned and if a part can be assigned, the tenant can be confirmed in the occupation of a part. The Amendment draws attention to an anomaly. It draws attention to an anomaly which has been caused by the Government's failure to restrict the Bill to its true and proper purpose, that of protecting a tenant in the occupation of house room which he needs for himself or his family.
§ Mr. Black
I beg to second the Amendment.
We find it very difficult to understand the reason for the differentiation of treatment between paragraph (a) and paragraph (b). Taking a practical view of this matter, as distinct from a legalistic view, both assignment and sub-letting are, after all, devices whereby the occupier of the premises, or the owner of the premises, parts with possession, either of a part or of the whole of the premises and it seems to us to be quite inconsistent and indefensible to make this distinction between paragraphs (a) and (b) and to say that an assignment of part only of the premises is to entitle the landlord to recover possession whereas a sub-letting of part only of the premises is not so to entitle the landlord. We feel that that is a very narrow legal distinction which is not supported by any practical distinction, and that it is a distinction which really cannot be supported.
My hon. Friend the Member for Wolverhampton, South-West, dealt with the question of the desirability or otherwise of encouraging sub-letting. I think it will be agreed on both sides of the House that in this period of housing shortage it is desirable that where there are surplus rooms, capable of being occupied, encouragement should be given to making those rooms available to families who are in desperate need of accommodation. My submission is that the Amendment which we are seeking to have incorporated in the Bill is not one which will determine whether surplus rooms are sub-let or not, but will merely determine whether the rooms are to be sub-let by the landlord or by the tenant. Our contention is that surplus rooms will be sub-let in either case, and we can see no justification for giving to the tenant the uncovenanted benefit of receiving a possibly high rent which he may be tempted to charge by sub-letting a part of the premises.
On the grounds of good estate management it is much better that letting and sub-letting should be undertaken by the owner of the premises rather than by a tenant. A tenant who sub-lets will almost certainly appropriate to himself in full the rent he receives on the sub-letting. Owing to his limited interest in the property he is not likely to plough back the rent or any substantial part of it in repairs and improvements to the property. Conversely, it is invariably the case that 290 if the owner of the property is able to undertake the sub-letting he will, having a much greater stake in the property than that of any tenant, have a much greater inducement than would a tenant to plough back a substantial part of the rent he receives each year in maintaining the property in a good state of repair, and in incorporating improvements and up-to-date devices from time to time.
There is the further point that where the tenant sub-lets he almost invariably does so without making the necessary structural alterations to the premises. He does not put in a separate kitchen, or a separate bathroom, or anything to make the part sub-let into a self-contained flat or maisonette. When the landlord is able to deal with the matter he will, in view of his long-term interest in the investment, almost always carry out improvements such as putting in a separate kitchen and bathroom and separate meters for services for the tenant, and the tenant who gets the benefit of the sub-letting thereby gets very much better premises from the landlord than he would get in the case of subletting by another tenant.
§ 7.45 p.m.
§ The Solicitor-General
Both the hon. Member for Wolverhampton, South-West (Mr. Powell), and the hon. Member for Wimbledon (Mr. Black) have really been re-arguing the case about Clause 1. That Clause applies to premises, even if the tenant lives only in part of them. The House has, by its vote, already indicated that it approves of Clause 1 as drafted, so it is too late to go back and argue that matter now.
One has to approach this Amendment on the basis that Clause 1 gives protection both in regard to that part of the tenancy which the tenant occupies and in respect of the part which he may not occupy. Supposing one starts from that premise, I understand both hon. Members to accept the view that the tenant should, if he has surplus accommodation, be in a position to sub-let it. Present housing conditions make that desirable. What we have done in the Bill is to give the tenant the possibility of sub-letting if he has spare accommodation. It is said, "You make an illogical distinction between sub-letting and assigning a part." During our discussion of the Bill in the Committee stage, I indicated the reason for the difference. Unless we make a partial 291 assignment a ground for a landlord giving notice under Clause 3 we will make it very easy for the tenant to evade this provision of the Measure, because he can sub-let a part and assign the remainder, thereby being in possession of no part himself but, nevertheless, enjoying the advantages which Part I of the Bill gives him.
It is for that reason that we found, apparently rather illogically at first sight, that it was necessary to make a distinction between sub-letting a part and assigning a part. We said that assigning a part would give the right to the landlord to determine the lease, but we did not want to say the same in regard to the subletting of a part, because we thought that the public interest required—and this is accepted—that the tenant should be able to sub-let a portion of the premises which he does not require for his own accommodation. Therefore, we have drafted the Clause in its present form. If we accepted the Amendment it would be going counter to what is accepted on all sides as being desirable by preventing the tenant from sub-letting part of the premises. For those reasons I hope that the House will agree that this proposed change should not be made, and that the Clause should remain as drafted.
§ Mr. Hay
The Solicitor-General has approached the problem of this Amendment from one aspect, but I do not think he has done justice to the argument which we have put forward. We cannot see the sense, logic or justice of allowing a tenant who is given the benefit of Part I of the Bill to make an unjustifiable profit at the expense of his landlord. That is the premise from which we start. The Solicitor-General starts from a different viewpoint.
We say that if the landlord is to be given the right to bring the whole tenancy to an end if the tenant assigns a part of the premises we cannot see the sense of permitting the tenant to retain, for example, one room in the premises and to sub-let the remainder, possibly, as my hon. Friend has pointed out, at an exorbitant or very high rent. There does not seem to me to be any justification for that. The whole case and argument for this Bill has proceeded on the basis that here is a class of person who ought to have some protection. It has been quite openly admitted by the Attorney- 292 General and others that if that involves a little hardship to the landlord they are not really worried about that. But this provision is going a little too far.
I appreciate the technical argument of the Solicitor-General, but what is being said here is that if a tenant chooses he can retain just one small room in the premises and can make a good profit out of subletting the remainder, while not really living there himself, because there are all sorts of subterfuges and ways round that provision. By doing that he will retain possession for a further two years and will still be in an advantageous position when the permanent legislation comes along, if indeed it does. We do not see that there is any justice in that.
I do not think that the Solicitor-General can be allowed to get away with the argument he advanced to us just now, and I hope that the House will not let him do so. If there are problems of drafting it is up to the Government, whose Bill this is, to provide wording to remedy the position. I ask the Government and hon. Gentlemen sitting behind them whether they really believe that it is right that a tenant—there will not perhaps be many, but there will be some—should have the right and the opportunity of making a profit at the expense of the landlord, when the whole object behind this Bill is to give the sitting tenant the protection which it is said he ought to have.
§ Mr. Awbery
It would be just as much right for the tenant to do that as it is for the landlord to do it. Landlords do it, and have been doing it for many years.
§ Mr. Hay
I will not argue the latter part of that contention, because I do not think it is relevant; but if the hon. Member really asks about it, I will point to what my hon. Friend the Member for Wimbledon (Mr. Black) said. If the landlord has the right to get back these rooms in the house he would let them again. So the argument about the housing problem not being improved if the tenant is not allowed to sub-let has nothing whatever to do with the case. The landlord will let just as well as the tenant. In the event of the landlord letting he will plough back in the shape of repairs and improvement to the building—which, no doubt, will need it badly—the money he receives by way of rents.
§ Mr. Keenan (Liverpool, Kirkdale)
I have been looking for a landlord like that for a long time.
§ Mr. Hay
I suggest that that is what will happen in 99 per cent. of the cases. and the hon. Member knows that just as well as I do. I know that hon. Members opposite have to put up a smoke screen about bad landlords because they think it may do them some good in the country, but they cannot get away with it always. That is why I think this Amendment is one which the Government ought to accept. It is one which, in justice and in fairness, they cannot really refuse. I realise that we are rather late in the day in bringing it forward, but there is an opportunity for these matters to be remedied in another place. If the right hon. and learned Gentleman persists today and says he is not prepared to accept the Amendment I do not know what my hon. Friends will do, but I hope that something will be done in another place to clear up this appalling anomaly.
§ Mr. Awbery
Regarding what the hon. Member for Henley (Mr. Hay) said about the tenant who lets part of the house at what the hon. Member described as an extortionate rent, is that not being done today by landlords?
§ Mr. Awbery
When a tenant vacates a house now, and the Rent Restrictions Act is removed so far as the empty house is concerned—
§ Mr. Awbery
—then the landlord charges just what he likes.
§ Mr. Hay
I am sure that the hon. Member does not wish to mislead the House, but if a landlord recovers possession of a house subject to the 1939 Act the rent control is certainly not removed. The hon. Member is 20 years behind the times.
§ Mr. Awbery
I am talking about exploitation by the landlord.