HC Deb 13 July 1954 vol 530 cc339-49
Mr. H. Macmillan

I beg to move, in page 3, line 41, to leave out "section, in this Act references," and to insert "Act, references therein."

This is a drafting Amendment. The value of claim holdings is affected by provisions other than those included in Clause 3; for example, by subsections (3) and (4) of Clause 7. Therefore we have to make this change.

Amendment agreed to.

The Attorney-General

I beg to move, in page 4, line 4, to leave out subsection (2).

I think that hon. Members who were on the Committee will remember that we had a considerable discussion on Clause 3, and this Amendment and a number of others which follow represent a genuine attempt to meet the points raised. Perhaps I should explain quite briefly what they try to do. Clause 3, as hon. Members know very well, deals with the conception of the claim holding and with its area and value. During the proceedings in Committee, it was pointed out that there was a great deal of complication in the matter, and also that provision was made for regulations and Schedules which brought in a great deal of arguable matter. There was a considerable amount of criticism of the drafting of the Bill on that ground.

During the second sitting of the Committee, my right hon. Friend said: The original intention was to put everything into the Schedules, but on consideration we were alarmed at the weight and length of the Schedules which would result, and which the Committee would be asked to examine in detail. We therefore thought that it would be better to take out some of the complications and to operate by regulation. It may be, as a result of the valuable discussions which have taken place in the Committee, that we shall be able to simplify the regulations which we have in mind. In that case, we should be willing to consider inserting on Report stage a simplified Schedule, which would include the points proposed to be dealt with by regulation, and it would be satisfactory if we could do so."—[OFFICIAL REPORT, Standing Committee C, 13th April, 1954; c. 88–9.] I am glad to tell the House that we have succeeded in producing something which goes even further than that, and which, I hope, will commend itself to the House, because it involves the slaughter of a Schedule which was something that a number of hon. Members were anxious to see take place.

If I may just summarise it, the purpose of this Amendment and of that to page 4, line 41, which may be confused with it, is to provide in the Bill for the creation of separate claim holdings, each having its own area and value where there has been a disposition of part of the benefit of an established claim. Previously, that was left to be dealt with by regulations made under subsection (2), and that came under fire in Committee. I will describe what we are trying to do.

First with regard to subsection (4). That subsection does not indicate precisely how the value and area of the various derivative claim holdings are to be arrived at. Instead, it leaves the value and area of each holding to be determined by the Central Land Board or the Minister as occasion arises, and lays down certain principles by which the Central Land Board or the Minister are to be guided. As those principles may conflict, it also lays down the priority between them. Any dispute arising can he referred to the Lands Tribunal as part of the Board's or the Minister's findings on the application for compensation.

I do not want to occupy too much of the time of the House in explaining this, but, in view of the importance of the matter, I think I ought to say that there are really two main principles involved which are contained in paragraphs (c) and (d) respectively.

The first is that in the case of a claim holding which is not associated with the ownership of the relevant interest in any part of the area of the claim, the value of the holding is to be that part of the amount of the established claim which was conveyed in the assignment. Where there was no associated transaction in land the assignment has to define, in one way or another, the part of the claim which is being conveyed. There is no difficulty about it. The area of the claim holding will normally be that part of the original claim area not allocated to any other claim holding.

In those cases where the claim holding and the land have been associated the second principle then comes into operation. That principle proceeds on the assumption that the parties intended that the part of the claim which was assigned should be what was appropriate to the area of land in which the assignee held or was to hold an interest. In those cases the area of the holding is to be the area in which the interest was held and its value is to be the part of the claim appropriate to that area. In the majority of cases there is no doubt that this will represent the intention of the parties, because the assignment was in some such terms as "so much of the benefit of the claim as was appropriate" to the land being sold or leased. That will probably also be found to be so in the great majority of cases where the amount assigned was specified.

I do not think I need to go into further detail on that aspect of the matter, but I should point out that subsection (5) carries out the other part of this operation—the replacement of the Fourth Schedule which will, I think, be received with pleasure by those who had troubles with it. It follows an undertaking given by my right hon. Friend, reported in column 115 of the Committee Report. I think that there is no difference between what we now propose and what the Minister then offered.

The subsection lays down how those concerned are to determine what fraction of the value of a claim holding attaches to any part of the area of that holding. Hon. Members will remember—and I am afraid rather painfully—the provisions of the Fourth Schedule, and will agree that what is now here is very much simpler. It will be operative, of course, not only in connection with payments under Part I, but also for the purpose of ascertaining the unexpended balance attaching to any piece of land, for whatever purpose required.

What has to be done is essentially quite simple; sometimes there are two stages in the calculation, at other times only one. Lines 56 to 60 of the Amendment deal with the straightforward case where the value of the claim holding which has to be divided up is equal to the amount of the original claim, or that part of it which was properly attributable to the area of the holding. That is the case where one might say that the value of the claim holding is at par. That is quite simple, but there are other instances where the value of the claim holding may be above or below par, in which case it will be either greater or less than the value of the established claim which is attributable to the area of the holding. One has then to scale up or down in the same proportion.

I think that this is a more attractive approach—at any rate to those who have had to deal with it in Committee—than that with which we were then dealing and I hope that it may commend itself to the House. There are several consequential Amendments with which I can deal in due course. For the moment, I ask the blessing of the House on what is quite a genuine attempt made as a result of my right hon. Friend's promise when the matter was raised by the hon. and learned Gentleman the Member for Leicester, North-East (Sir L. Ungoed-Thomas) and the hon. Member for Wellingborough (Mr. Lindgren).

6.15 p.m.

Mr. Lindgren

The learned Attorney-General has followed the easy ways of our Committee upstairs, and the discussion has gone, I think quite rightly, outside the general terms of the Amendment under discussion. He having done that, I should like to say that we on this side do appreciate not only the genuine attempt which has been made by the draftsmen, the Attorney-General and the Minister to clear up the obviously valid points to which my hon. and learned Friend the Member for Leicester, North-East (Sir L. Ungoed-Thomas) drew attention, but the effective way in which it has been done.

I have only one point to raise. In the second line of the Amendment in page 4, line 41, it says: … mortgage made otherwise than by way of assignment.… I am just wondering why the words … otherwise than by way of assignment … have been brought in. Apart from that we not only accept this, but express our appreciation for the attempt made to meet the points which we raised.

Mr. F. Blackburn (Stalybridge and Hyde)

As one who called attention in Committee to the intricacies of the Fourth Schedule, I should like to take the opportunity of saying farewell to it, and of congratulating the Minister and the Attorney-General on the action which they have taken. This solution is much better than the suggestion made in Committee that an explanatory memorandum should be produced for the Fourth Schedule. Obviously, in Committee, I wrought much more successfully than I realised. I moved an Amendment that subsection (4) in page 4 should be omitted, but I must, in all modesty, admit that that Amendment was merely exploratory to find out exactly what the Fourth Schedule meant.

It does not matter particularly that a layman like myself should have difficulty in understanding this Bill, but I think it very important that the lawyers, at any rate, should have a little inkling as to what it means. I was afraid that, as it stood, lawyers not mathematically inclined might be in some difficulty with the Fourth Schedule. I am very pleased that the Minister and the Attorney-General have been able to meet the wishes of the Committee. In conclusion may I just express the hope that means may be found of preserving the Fourth Schedule in the archives of Parliament in order that future draftsmen of Parliamentary Bills may have before them a dread warning of exactly what can be done with the English language when one is really trying.

Mr. MacColl

I, too, wish to thank the right hon. Gentleman for his Amendment. By general concensus, it is a wise way of tackling the problem and comparatively—I emphasise the word "comparatively"—simple to understand. I think that all that has been said about it is quite satisfactory to those who were members of the "club" upstairs, because they know what the Fourth Schedule is. They have lived with it. They have taken it to bed with them at night. They have walked the long hours and weekends in the mountains when we were there trying to understand the Fourth Schedule. As this is the Report stage, with which the whole House is concerned, it should be explained to the House that this proposed Amendment is a complete recasting of a vital and important part of the Bill.

I think that it calls for this comment. The hon. Member for Stalybridge and Hyde (Mr. Blackburn) made his eloquent and clear speech to the Committee on, I think, 13th April. We are now well into the middle of July. For those long months the practitioners who contemplated that they would have to administer this Bill and were already receiving requests from clients to explain their position under the Bill have been trying to wrestle with the Fourth Schedule. They now find that all their labours were in vain. They have to start again, though admittedly along much pleasanter paths—if one can use the word "pleasant" about any part of the Bill, but I really think it should be emphasised that the Government should not have introduced such things into the Bill. It was clear on the Second Reading that, as it was then drafted, this Bill was quite incomprehensible and that no one could be expected to administer it. The only two persons who ventured to disagree with that point of view were the Attorney-General and the hon. Member for Hertford (Mr. Walker-Smith).

Mr. Derek Walker-Smith (Hertford)

If I may intervene, what the hon. Gentleman said on Second Reading was that the whole of the Bill was incomprehensible, and that is what I ventured to disagree with. I do not say that every sentence was perfect as the Bill was then drafted.

Mr. MacColl

I have always—I will not say exaggerated the abilities of the hon. Member for Hertford, but I have paid them full tribute. I thought he said that he had understood the Bill. I am glad to know that it is only the Attorney-General who understood the Bill. It is true that at a later stage revelation came to my hon. Friend the Member for Cardiff, West (Mr. G. Thomas) who had the honour of presiding over the Committee, but that was much later, and it was an uncovenanted mercy. I do not think that he would claim any great credit for it himself.

Mr. George Thomas (Cardiff, West)

I am very grateful to have the opportunity of saying that my understanding was confined to the proceedings upstairs.

Mr. Deputy-Speaker (Sir Rhys Hopkin Morris)

The debate at the moment is hardly on the Amendment.

Mr. MacColl

We have the lonely figure of the Attorney-General who is the only person who understood the Bill. One ought to pause to reflect that it is an odd thing that a Bill can get a Second Reading, can go upstairs, can be debated, and then when people really face it they have to admit that not one of them understands what it is about. I think that is a little irresponsible on the part of the Government, because when a Bill is published, people whose job it is to understand these things have got to try to grasp them. The fact that three months later common sense comes to the Government and they produce a comparatively simple way of doing the job is not really playing fair with the public. Those of us sitting here may expect to be bewildered by the pyrotechnics and gyrations of the Government—that is one of the risks of our job—but the unfortunate public ought reasonably to expect a Government which produces a major Bill of this sort—

Mr. Deputy-Speaker

I think the hon. Member is now making a Second Reading speech.

Mr. Horobin

Fourth Reading.

Mr. MacColl

I welcome this Amendment. I do not pretend to understand all of it, but I think that with a little care and patience, I may begin to understand it. This Amendment is a great improvement, and I hope the House will accept it.

The Attorney-General

The hon. Member for Wellingborough (Mr. Lindgren) is entitled to an answer to the serious question that he put. The point about the phrase otherwise than by way of assignment is purely a technical one. The wording is to make sure that a mortgage which takes the form of a charge does not give rise to the creation of new claim holding. Mortgages are looked after by regulations under Clause 68 simply for the purpose of ensuring that there is no complication created.

As to the rest of the debate on this Amendment, which perhaps went rather beyond the Amendment at times, I ought to say a word or two. I personally regard the difficult point of the Fourth Schedule with some regret, because I burned some little midnight oil on it and I achieved a result for which I do not think the hon. Member for Widnes (Mr. MacColl) gave me credit. The hon. Member for Stalybridge and Hyde (Mr. Blackburn) said that he had understood my explanation and I wrongly attributed that statement to the hon. Member for Widnes.

Mr. Blackburn

I have never claimed to understand any particular part of the Bill.

The Attorney-General

The matter was crowned by the clear statement of the Chairman of the Standing Committee that to him, at any rate, the thing was crystal clear. Therefore, I hope that the House will now accept this Amendment.

Amendment agreed to.

Further Amendments made: In page 4, line 28, leave out from "holding," to "was," in line 29.

In line 41, leave out 'from the beginning, to the end of line 45, and insert: value and an area.

(4) Where by virtue of any disposition of part of the benefit of an established claim, not being a mortgage made otherwise than by way of assignment, different persons became entitled to different parts of that benefit, then, as from the date of that disposition (in this subsection referred to as "the relevant disposition"), each of those different parts shall be treated as having constituted a separate claim holding, and the area and value of each of those separate holdings at any material time after the relevant disposition shall be taken to have been such as may, on the occasion of an apportionment affecting that holding falling to be made for any of the purposes of this Act, be determined by the authority making the apportionment or, where that authority's findings are referred to the Lands Tribunal under any provision of this Act, by that Tribunal to be just and appropriate in all the circumstances; and in making their determination the authority or Tribunal shall in particular have regard to the following principles, that is to say—

(a) that the aggregate of the values of all claims holdings representing parts of the benefit of the same established claim shall not exceed the amount of that established claim:

(b) that, subject to the preceding paragraph, where a claim holding representing part only of the benefit of an established claim has been pledged to the Central Land Board within the meaning of the Second Schedule to this Act, otherwise than as is mentioned in paragraph 2 of that Schedule, and by virtue of that Schedule any deduction falls to be made from the value of that claim holding by reference to an amount due by way of development charge, the value of that holding at the time of the pledge shall not be taken to have been less than the lesser of the two following amounts, that is to say—

  1. (i) the value attributed to the holding for the purposes of the pledge; or
  2. (ii) the amount due as aforesaid;

(c) that, in the case of the claim holding representing the part of the benefit of an established claim which was the subject of the relevant disposition, not being a claim holding to which paragraph (d) of this subsection applies—

  1. (i) the area of the claim holding should be taken to be the claim area of that established claim less the area of any 348 claim holding to which the said paragraph (d) applies which represents part of the benefit of the same established claim; and
  2. (ii) the value of the claim holding immediately after the relevant disposition should, subject to paragraphs (a) and (b) of this subsection, be taken to have been that part of the amount of the established claim to which he holder purported to become entitled under the terms of that disposition;

(d) that where any person who has been entitled to a claim holding representing part only of the benefit of an established claim—

  1. (i) at any time while so entitled has also been entitled to the interest in land to which the established claim related in so far as that interest subsisted in part only of the claim area; and
  2. (ii) became entitled to both that holding and that interest in such circumstances that the authority aforesaid or, as the case may be, the Lands Tribunal are satisfied that the holding and the interest were intended to relate to one another, the area of that claim holding should be taken to be that part of the claim area, and the value of that holding immediately after the relevant disposition should, however that or any other disposition affecting the holding was expressed but subject to paragraphs (a) to (c) of this subsection, be taken to have been an amount equal to so much of the amount of the established claim as might reasonably be expected to have been attributed to that part of the claim area if the authority determining the amount of that established claim had been required to apportion it, in accordance with the same principles as applied to its determination, between that part and the residue of the claim area.

(5) References in this Act to the fraction of the value of a claim holding which attaches to a part of the area of the holding are references to so much of the amount of the established claim of which that holding represents the benefit or part of the benefit (in this subsection referred to as "the relevant established claim") as was properly attributable to that part of the area of the holding:

Provided that where, by virtue of any provision of this Act, the value of the claim holding at the time in question is to be treated as less or greater—

  1. (a) in a case where the area of the holding and the claim area of the relevant established claim are the same, than the amount of that established claim; or
  2. (b) in a case where the area of the holding consists of part only of the said claim area, than so much of the amount of the relevant established claim as was properly attributable to the area of the holding, the amount of the fraction aforesaid shall be treated as reduced or, as the case may be, increased proportionately.

For the purposes of this subsection, the part of the amount of the relevant established claim which was properly attributable to any land forming part of the claim area shall be deemed to be so much of the amount of that claim as might reasonably be expected to have been attributed to that land if the authority determining that amount had been required to apportion it, in accordance with the same principles as applied to its determination, between that land and the residue of the claim area."

In page 5, line 18, leave out from "holding," to "means," in line 19.—[The Attorney-General.]

Mr. H. Macmillan

I beg to move, in page 5, line 20, at the end, to insert: or, where the holding is subject to a mortgage made otherwise than by way of assignment, means the person who would be so entitled if the holding had not been mortgaged. The purpose of this Amendment is to make it clear that, where a claim holding is subject to a charge, the person entitled to the benefit of that charge is not to be regarded as the holder of the claim holding. The position of mortgagees is dealt with and safeguarded by Clause 68, which provides for the diverting of payments to them. If the mortgagee has taken an assignment of the claim, he is not affected by this Amendment and is entitled to claim in his own right under Clause 10.

Amendment agreed to.