§ Order for Second Reading read.
§ 11.8 a.m.
§ Mr. Ray Mawby (Totnes)
I beg to move, That the Bill be now read a Second time.
This is a short Bill containing only two Clauses and it is certainly not designed to have world shattering effect, but it is a Measure to make certain that the expressed wishes and desires of Parliament have full legal effect. Parliament in its wisdom has decided that no premiums or key money shall be charged as a condition of the grant, renewal, continuance or assignment of a tenancy, and all the Bill seeks to do is to prevent anyone from evading the law by going round by the back door.
One can well understand and appreciate that in certain circumstances it is in the interests of both the outgoing and incoming tenant that certain furniture and fittings should remain and that a reasonable financial adjustment should be made. Two obvious examples of this are fitted carpets and curtains. In both these instances the alteration required to fit a fitted carpet or curtains in new premises would reduce their value considerably. I believe that no fair-minded person would see anything sinister in anyone asking for a reasonable price, so that a satisfactory financial arrangement may be made in those circumstances in the interests of both parties.
Nevertheless, it must be realised that the incoming tenants, even in these circumstances, may still have to face double expense, because, just as we know full well that no kitchen is large enough to hold two women, I doubt whether there are two women in the country who would agree on the type of carpet or curtains that would be desirable. However, that is something which can be worked out and in the circumstances nothing sinister can be seen in this arrangement. The Bill is certainly not aimed at that type of transaction.
The Bill is aimed purely and simply at the case where, because of acute local shortage, a person will deliberately make 651 it a condition that a large sum is paid for a piece of mouldy old linoleum and a few sticks of broken down furniture. These are obviously cases where the landlord takes advantage of a fortuitous situation to charge a premium in another way, so that he can avoid the law and the wish of Parliament as expressed in the past.
I think that two main types of people are affected, though no doubt hon. and right hon. Members will know of others. There are those whose job or profession means that they have to make frequent moves and therefore have little opportunity of making roots so as to be able to justify the purchase of accommodation. The second group comprises those who do not possess sufficient capital to be able to enter into a purchase arrangement so that they can own their own property. The first type, after paying an outrageous price for furniture and fittings, will certainly tend, human nature being what it is, to try to get their money back when they leave the accommodation, with the result that this whole practice will be perpetuated and extended if we allow it to continue. The second type comprises those who have to keep looking for accommodation, with little hope of success.
Another additional problem which both groups have to face is the agency percentage. The usual procedure is to charge the prospective tenant a percentage of the first year's rental, but in many cases this is also a percentage on the furniture and fittings that are offered. It means, therefore, that a considerable amount of capital must be laid out, and for that reason we should look at the position very closely indeed.
I should have thought that the main aim of any letting system was to cater for those with very small capital who find it impossible to enter into a purchase arrangement because they cannot put down the deposit. Some may say that this problem will solve itself, because the amount of capital which many people now have to put down by way of high prices for furniture and fittings plus agents' commission is reaching the point where it may be higher than the deposit demanded for the purchase of a house in one's own right. That may be so; but I want to regulate the position 652 in the meantime until we reach that happy situation when supply and demand are properly in balance.
So much for the background of the problem. Now let us consider how we think that the Bill will help in the present circumstances. In theory the Bill will apply to controlled and decontrolled properties, but in practice as a tenancy ends the property becomes decontrolled, and the Bill will apply in practice to decontrolled premises. It is important to note that it will apply not only to landlords but also to tenants who reassign their leases to tenants who follow them into the premises.
Clause I (1, a) makes it an offence for anyone who knows or ought to know that the price is unreasonably high to seek that price as a condition of tenancy. Clause I (1, b) provides that where a price is asked a written inventory must be provided specifying the price sought for each item. It is hoped that this alone will have a deterrent effect on those who want deliberately to use this backdoor way of charging a premium. I believe that it will have that deterrent effect and will make evasion more difficult.
Subsection (2) of the same Clause gives local authorities which have reasonable ground to suspect that an offence is being committed the right to enter and inspect. I am one of many people in the country who believe that extension of the power of entry should not be made unless full inquiries have already been carried out and all efforts made to ascertain that the desired result cannot be achieved in some other way. In this case I believe that at the moment there is no other effective way of apprehending those who would be offending against the terms of the Bill. There may be another way of which we are not aware. If the Bill reaches the Committee stage we should be prepared to study very closely any suggested alternative which can ensure the apprehension of those who offend against the Bill.
It must be realised that it is to the local authority that the normal disgruntled seeker after accommodation goes first, because he believes that it is from the local authority that he can obtain most satisfaction. The local authority is called upon to act in many ways in relation to housing accommodation. I should have thought that if complaints were brought to the local authority and 653 the terms of Clause I (1, b) were carried out, the contents of the price inventory would give the local authority a fair idea of whether an offence was being committed, without its having to exercise the right of entry.
§ Mr. Dudley Williams (Exeter)
Would my hon. Friend tell the House who on the local authority will decide which items, if any, arc priced too high? Whom will the local authority employ for that purpose? Will it have someone on the staff whom the hon. Member has in mind, or will it have to employ people from outside?
§ Mr. Mawby
At the present stage of the Bill that is not laid down. The responsibility is just placed upon the local authority. In those circumstances I should have thought the local authority would be free to take whatever action it thought necessary. In normal circumstances a small local authority would probably call in a person it considered to be a qualified valuer, one who could be relied upon in a court of law to be recognised as reasonably expert in deciding whether the price asked was outrageous or not.
The main point we have to consider is that the Bill is designed to operate against tie man who is obviously charging an outrageous price which bears no relation to the articles there. In the case of a landlord who wants to let a flat, and who says that in the drawing room there is a Queen Anne table for which he is charging a certain amount, all the local authority would require to do would be to look at the inventory and decide whether this was a gross exaggeration of tie actual value of the furniture and fittings. However, as I have said, in Committee we can tie this a little tighter and can lay down what action should be taken and what officer the local authority could use to ensure that it was doing its job.
Even before deciding upon prosecution, even after looking at the inventory and feeling that there was a gross exaggeration of the value of the contents, one could not go forward with a prosecution without checking and inspecting the articles covered by the inventory. To do that, some responsible official, say a valuer, should be able to enter the premises in order to check whether at first sight the inventory is accurate or 654 whether there is grave suspicion that an offence is being committed, whereupon the prosecution, could be put in train.
It is also important to note that in all these circumstances the premises concerned would be open to view. They would be available for prospective tenants to look at them and to decide whether they would care to enter into a tenancy agreement, which naturally they would not do until they had viewed the premises. In these circumstances, I should not think there was any more invasion of privacy than that caused by a prospective tenant. Certainly, where there is the opportunity to view. I should think that one of the persons allowed to view should be a representative who wants to find out whether the law is being broken.
As I have said, this is the only way we can see of apprehending the offender, but during the Committee stage we shall be happy to consider any suggestions which may be made for some other satisfactory way of apprehending the wrongdoer.
The House has been very patient with one who obviously is not well versed in the legal complexities surrounding this problem, but no doubt any deficiencies will be remedied by those who follow me.
§ 11.24 a.m.
§ Mr. Graham Page (Crosby)
I beg to second the Motion.
I would describe this Bill as endeavouring to remedy a minor complication which has arisen out of a major operation. The major operation was the Ren; Act, 1957, and the minor complication is that certain provisions regarding hidden premiums are being evaded. The history of endeavours to prevent demands for high premiums goes back a long way, to the beginning of the Rent Restrictions Acts. Even the 1915 Act contained provisions against demanding a premium for controlled property, and the 1920 and 1923 Rent Acts went a little further by forbidding not only the demanding of premiums for the transfer of controlled property, but also made it an offence to demand an excessively high price for furniture.
In the 1920 Act there was a specific provision relating to assignments of controlled tenancies. I mention that now, because I will come back to the point later. It is in Section 15 (2) of the 1920 Act, where it was first enacted that a 655 tenant assigning his controlled tenancy ought not to require a premium and ought not to demand an excessive price for furniture sold with the controlled premises.
This was further developed in the 1923 Rent Act, so we have not only the criminal offence of demanding a premium for transfer of controlled premises but also a civil claim by the person who has paid the premium, or the person who has paid the excessive price for the furniture, to recover the money he had paid.
The present provisions relating to this point are in the Landlord and Tenant (Rent Control) Act, 1949, which repealed and re-enacted the 1920 Act provisions relating to it, and repealed some of the 1923 Act provisions and re-enacted them. It is Section 3 of the Landlord and Tenant (Rent Control) Act, 1949, with which we are particularly concerned in this Bill. That is the Section which forbids the demand of an excessive price for furniture sold with a lease of controlled premises.
The Rent Act, 1957, by Section 13, applied those Sections of the 1949 Act to property which was decontrolled by the Rent Act, 1957. Up to that time those provisions concerning premiums and excessive price for furniture had applied only to controlled property, but, as the Rent Act, 1957, was decontrolling certain properties, it extended the provisions of the 1949 Act to those properties which it decontrolled. I will endeavour to explain what it was that Section 13 of the 1957 Act applied to those properties.
It applied provisions about demanding a price which exceeds a reasonable price for furniture sold with controlled premises or premises which became decontrolled by the 1957 Act. It also applied the provision of the 1949 Act that if the prospective tenant required a statement in writing of the price asked for the furniture, it was to be given. If it were not given, an offence was committed.
I come next to the properties to which Section 13 of the 1957 Act applied the provisions of the 1949 Act. They were two sets of properties. One was those which were decontrolled by the 1957 Act because their rateable value exceeded £30 in the provinces and £40 in London. Rt. hon. and hon. Members will recall that there was a period of 656 transition for fifteen months after the Rent Act came into force when a three years' lease might be granted of such premises and they would thus, for practical purposes, be prevented from becoming decontrolled, although by law they in fact became decontrolled on 7th October, 1958. That is one class of decontrolled property to which Section 13 of the 1957 Act applied the provisions dealing with premiums and excessive prices for furniture.
The other class was where a new tenancy of controlled property was granted. Any controlled property becomes decontrolled under the 1957 Act if a new tenancy is granted, unless that new tenancy is to the sitting tenant, and it is to those properties also that Section 13 applied these premium provisions.
I admit at once that in many cases Section 13 of the Rent Act, 1957, has not been successful in preventing the demands for hidden premiums. I looked up what I said on Report in connection with this Section, and I see that I said I thought that it would be effective. In fact, I said so rather strongly at the time. I think that it has been effective in the cases which we then had in mind—those of the three years' lease granted to the sitting tenant. I think that it has prevented landlords from demanding any hidden premium in those cases, but other cases have arisen since then, to which I will refer in a minute, which makes it necessary to tighten these provisions.
May I endeavour to show how the Bill tightens these provisions? First, the 1949 Act used the words that if the excessive price for the furniturehas been required as a condition of the grant, renewal, continuance … of a tenancy.The courts have held that this is not proved unless the money has been paid. As the law stands now, it is only after the event that anything can be done. In the Bill, it is desired to do something before the event and the words used in the Bill are offers the furniture". Hon. Members will see in Clause I (a) the wordsoffers the furniture at a price which he knows or ought to know is unreasonably high".The second tightening of these provisions is that in the 1949 Act the words "exceeds the reasonable price" were used. In the Bill the words area price which he knows or ought to know is unreasonably high".657 Those may not be the right words to use, but what we are trying to do in the Bill is to penalise the man who is offering furniture at an obviously high price and to prevent him from persuading a prospective tenant—in these days an eager tenant—from paying an excessive price.
Thirdly, there is a tightening on the question of requesting a statement in writing. In the 1949 Act the seller of the furniture had to give a statement in writing of the price if requested to do so. Under the Bill, it would be an offence if he failed to furnish not just a statement of price, but an inventory setting out the price against each item, and it is not merely if he is requested to do that; he must do it with the particulars which he gives of the tenancy which he is offering.
That, I think, overcomes the reluctance of a prospective tenant in asking for a list of the furniture and the prices against it. Where the prospective tenant is seeking a tenancy of premises at present, when there is a short supply in many areas, he is reluctant to put himself in difficulty with the agents or the prospective landlord, and one hears of cases in which prospective tenants who inquire too much are put on a black list by agents. That is the sort of thing we want to prevent by the Bill, because it is a misuse of the protective Clauses of the Rent Act, 1957, and the Landlord and Tenant (Temporary Provisions) Act, 1958.
§ Mr. Dudley Williams
Surely, if a black list is maintained by agents, it is the duty of the professional body concerned with agents—and my hon. Friend knows very well which body it is—to take action against its members. If certain of its members are sending around saying, "So and so should not be given a house because he is not prepared to pay a high price", then it is a matter for the professional body.
§ Mr. Page
I am glad that my hon. Friend pulled me up there, because I was, perhaps, using the phrase "black list" in a rather loose way. I do not believe that there is a black list circulated amongst agents. What I meant was that an agent will send a prospective tenant away who asks too many questions and will not endeavour to do any transaction with him.
658 There is not only that reluctance among prospective tenants to make too many inquiries but, if they enter into a transaction, take the tenancy and pay this hidden premium, then there is undoubtedly a great reluctance to bring any proceedings thereafter. For the ordinary person it sounds rather like blackmail when he goes to the landlord or the assignor and says, "You have taken from me too high a price for this furniture and I want the money back".
I say that it sounds like blackmail, because if he is successful in getting the money back from the landlord or from the assignor it follows that the landlord or the assignor has committed a criminal offence. If it is necessary to bring civil proceedings in which the tenant who has paid the money is successful, then criminal proceedings must necessarily follow. It seems to the man who is claiming his money back that he is not only claiming a civil debt, but is also threatening criminal proceedings, and there is a reluctance to do that.
This is surely one of the cases in which it is necessary to protect a person against himself. We recognise that principle in many respects in law. We recognise in moneylending cases and hire-purchase cases that certain documents, whether asked for or not, should be prepared and handed to the other party to the transaction. This idea of protecting the person against himself in certain circumstances particularly applies to subsection (2) of Clause 1.
My hon. Friend said that we might not have got the provision quite right. It certainly looks rather a frightening Clause at the moment in giving power to a local authority to enter premises. But surely we should prefer entry to be above board and open rather than that it should be by the subterfuge of pretending to be a prospective tenant. The local authority already has power to take proceedings. That power was given as long ago as the 1933 Act and it was applied again in the Rent Act, 1957. If the local authority has power to take proceedings, it must have evidence on which to take them if it suspects that an offence has been committed.
If we did not give power specifically in the Bill the local authority could send its representative secretly as a prospective tenant and get its evidence that way. It 659 would be most unfortunate if we expected local authorities to do that. It is far better to give them specific power clearly laid down in the Bill, a power to be exercised with the knowledge of the person whose house is being entered.
Safeguards are provided in the Clause. First, the local authority has to have reasonable grounds for suspecting that an offence under Clause I (1, a) has been committed. That is at least some protection that the local authority will not act frivolously or oppressively in exercising its rights.
§ Mr. Dudley Williams
Who will decide whether the local authority has reasonable grounds? Will the local authority have to go to court and get approval of its grounds? Will it make a guess? To whom has the landlord an appeal if he thinks the grounds are unreasonable?
§ Mr. Page
The local authority is given the right to decide whether there are reasonable grounds, with a possible appeal to the court eventually on the ground that it has trespassed because it had no reasonable grounds for entry. It 's a very familiar provision in the statutes. ft is used again and again in the case of police taking action and in other cases where local authorities have the right to enter, such as under the Food and Drugs Act.
§ Mr. John Hobson (Warwick and Leamington)
Can my hon. Friend tell me of any other case in which the authority which is to launch the prosecution is the authority which decides that it has reasonable grounds compulsorily to enter premises for the purpose of obtaining evidence to launch the prosecution?
§ Mr. Page
I think that that is so under the Food and Drugs Act. I believe the authority which launches the prosecution is the authority which has the power to enter and inspect and decide whether it has a reasonable case for doing so.
The second safeguard is that the authority must give notice to the person in possession of the premises. Thirdly, the local authority representative is not permitted to force entry. If it is not possible to obtain entry by being admitted, the process by way of search warrant, on the authority of a justice of the peace, would 660 have to be taken. The Clause applies only to voluntary admission and certainly does not allow the local authority to break into premises. The fourth safeguard is that entry can be refused on reasonable grounds. With those safeguards I think the Clause might operate satisfactorily.
It may well be that hon. Members think that further safeguards ought to be introduced, but, as my hon. Friend said, this is not really an invasion of the privacy of a person's house. That person is the prospective assignor or lessor and he is already throwing his house open for inspection by prospective tenants or assignees.
§ Mr. Albert Evans (Islington, South-West)
The hon. Member suggests that the Clause will operate fairly and contains adequate Safeguards. He says that the local authority has to give notice to the occupier or the person offering the rooms that it intends to visit and inspect. Does he think that that will work in practice and that the occupier will, on receiving notice, agree that the local authority should enter?
§ Mr. Page
If the occupier does not do so and has no reasonable grounds for refusing, he commits an offence under subsection (2, b). I imagine that the notice given by the local authority would draw attention to the fact that if admission is refused without reasonable cause an offence is committed. Indeed. I should think it absolutely necessary that the local authority should give that warning to the occupier.
As I have said, the local authority already has power to prosecute for this type of offence, but local authorities seldom have the material on which to prosecute and the Clause is intended to give them that material.
Against whom is the Clause aimed? The evil arises mainly in the following circumstances at present. The Rent Act, 1957, allowed fifteen months after it came into operation for three-year leases to be granted to sitting tenants of houses of £30 rateable value in the provinces and £40 in London to avoid those tenants being turned out. I imagine that those leases have been granted if they are to be granted and that that transitional stage has passed. I do not want to be controversial, but I would point out that that 661 stage has passed without any real hardship as forecast by hon. Members opposite. Therefore, the Clause is not intended as a protection for previously controlled tenants who were seeking to retain control, for that stage is over.
During the transitional stage, however, considerable pressure was brought on landlords to grant such leases. My right hon. Friend the Minister of Housing and Local Government made certain statements and eventually introduced the Landlord and Tenant Act, 1958. That pressure was brought on landlords to protect the tenant in his home. If, having got that protection and having got his three-year lease, the tenant now seeks to make a profit out of it by assigning the lease with furniture at an excessive price, we ought to prevent him from doing so. That is the main evil which is arising at present. It is the assigning of leases by tenants, who obtained them when landlords were being pressed to grant them. That is the main case with which we now want to deal.
There are other cases; for instance, landlords who have obtained possession by the tenant surrendering his three-year lease, or where a three-year lease has not been granted. Such landlords ought not to be allowed to evade the provisions of Section 13 of the Rent Act which applies the Landlord and Tenant (Temporary Provisions) Act, 1949. Nor should the landlord who obtains possession of controlled premises be permitted to put some furniture into them and then to dispose of the furniture at an excessive price.
On that point, it is worth drawing attention to the fact that the 1949 Act applied only to decontrolled premises; the 1957 Act decontrols controlled premises immediately a new tenancy is granted, so the 1949 Act would not have applied to those premises which became decontrolled under Section 11 (2) of the 1957 Act if Section 13 had not been enacted. There is evidence that landlords of such premises who obtain possession relet them and demand excessive prices for furniture put into the premises deliberately for the purpose of getting a hidden premium on granting a new tenancy.
Those are the categories in which the existing law is inefficient in apprehending the offender. This temporary Measure—because it will last for only three years after the Rent Act has expired—is perhaps a little drastic, but in present circum- 662 stances it is necessary, so that a wrong advantage cannot be taken of provisions which were made for the protection of tenants under the Rent Act, 1957, and the Landlord and Tenant (Temporary Provisions) Act, 1958.
§ 11.52 a.m.
§ Mr. C. W. Gibson (Clapham)
I congratulate the hon. Member for Totnes (Mr. Mawby) who introduced the Bill and I hope that it will not prejudice his political prospects. The Bill deals with a racket in all the large towns, especially London, which has been missed when previous legislation has been enacted. I thank the hon. Member for Crosby (Mr. Page) for his legal explanation of the background to the problem. He showed that the House has been concerned with the problem for years and has always been anxious to find some reasonable solution.
I am not sure that the Bill goes as far as I should like, but at any rate it is a good effort to try to give protection to people who are homeless, or who have to move their homes to other addresses. It will protect them from the sharks who are infesting the house-letting business these days.
The hon. Member for Crosby suggested that this was a minor matter. All I can say is that I do not hold a meeting at my "surgery" without having someone complaining to me about hidden premiums which they have to pay when trying to get empty accommodation. That that is true is shown by a list which I have in my hand. It is a list of empty properties in London. There are about 230 properties on the list, 70 per cent. of them with a premium attached. I can give the House the name of this firm which has allowed this list of properties to escape from its office. It is Centacom, 93 Jermyn Street, S.W.1.
I want to show that excessive and hidden premiums are being charged all over London and not only in those parts where one would expect such a racket to go on. I propose to give the House the districts, the amounts being charged, and the number of rooms in each flat. That should show how the Bill can provide assistance to poor devils who do not have a decent home of their own.
I shall not quote all the list, but I shall take a few scattered examples. In Kensington, there is a two-roomed flat, a 663 basement flat at that, for which the premium is £650. In Lavender Hill, which is very near my constituency, for a two-roomed flat a premium of £400 is asked. Why anybody should pay any money to live in Lavender Hill I do not know.
§ Mr. Dudley Williams
Does the hon. Member mean that a premium is being asked, or that prospective tenants are being asked to buy some furniture?
§ Mr. Gibson
The premium is camouflaged by having the initials F & F— furniture and fittings—on the top of the list. If there is a two-roomed flat in Lavender Hill containing £400 worth of furniture, I shall be very surprised.
In Lewisham there is a two-roomed flat with a premium of £300; in Holland Park, which used to be regarded as a salubrious part of London, there is a two-roomed flat with a premium of £420; in Hendon there is a two-roomed flat with a premium of £200—that is one of the low figures; in Bayswater there is a one-roomed flat with a rent of £234 per annum and the premium asked is £250. It is as plain as the nose on one's face that that is a hidden premium. In Victoria there is a two-roomed flat with a £400 premium; in Wembley, there is a two-roomed flat with a premium of £600 and the rent and rates are £216 per annum.
§ Mr. Charles Doughty (Surrey, East)
Has the hon. Member visited any one of these flats and can he assist the House by giving us any idea of the approximate value of the furniture and fittings?
§ Mr. Gibson
I have seen places in Lavender Hill and I would not pay 6d. to live there, if I could help it. I have a letter from a constituent who went to that area and I propose to quote the latter later.
There are very much worse cases. In the Gloucester Place area there are three two-bedroomed flats. The rent and rates are £180 per annum, while the premium for one is £910, for another £1,656 and for the third £2,180. When this case was brought to my notice my comment was that the furniture must have diamonds on it, because it is obviously not a reasonable figure to ask for furniture and fittings, when it is remembered that if somebody lets accommodation with furniture 664 and fittings he is entitled to be paid for their value in the rent. The Bill provides machinery for local authorities to enter premises in order to check up the situation, and, if necessary, to prosecute where excessive premiums are being charged.
I have two more cases concerning one-roomed flats. One is in Highbury, where the rent is £198 a year and where a premium of £250 is being asked for furniture and fittings. The other, again in Bayswater, carries a premium of £500. It is amazing how the value of furniture varies as one goes through the list. I want to give just two more examples from the list, supplied by the firm I have mentioned to one of my constituents. In the Marble Arch area an empty two-roomed flat is offered at £326 a year, with another £350 for the furniture in it. In the St. John's Wood area, for a four-roomed fiat with a shower bath—I suppose that that considerably increases the value of the furniture—£1,000 is asked for furniture and fittings. I could give many more examples.
These examples, in respect of premises scattered all over the London area, show how necessary it is to have a Bill of this kind in order to clip the wings of people who are deliberately robbing others who badly need accommodation. I have a letter from a constituent who applied for one of these flats. She was willing to pay the rent, and said that she would take the flat. Only then was she told that she would be required to pay £150 for the furniture and fittings, which she declared were not worth half that. Even if they had been worth it, she had not the money to pay. Many people in and around London and other large towns are in that position. This youngish widow says:In my opinion this is a monstrous imposition. Thanks to the Rent Act, and those who ordered it, my landlord wants possession because I cannot afford to agree to his terms to pay £48 extra rent, all rates and taxes and be responsible for repairs and decorations, out of £7 per week. I am now confronted with an impossible situation …. Something ought to be done about this racket. It is a case of Shylock getting fat on other people's misfortunes.The Bill will to some extent help to prevent people like this lady from being rooked by unscrupulous agents.
I am not labelling all agents as unscrupulous. I have paid my rent to 665 agents all my life, until recently. I have had good agents, and have never had any complaint against them. They have dealt with the property in which I have lived quite reasonably and well. But there are many crooks in this business, who are charging excessive premiums in order to make money quickly and exploit the dire necessity of people who must have somewhere to live.
I was interested to hear the hon. Member for Crosby admit that there is a shortage of accommodation, and that people who apply for these premises are in the hands of these agents. I hope, therefore, that the House will give the Bill a Second Reading. Once the lawyers get at it a number of alterations may be made, but some effort ought to be made to provide protection for people who are being caught by this racket, and the Bill will go some way towards that.
§ 12.5 p.m.
§ Mr. John Hobson (Warwick and Leamington)
I join with the hon. Member for Clapham (Mr. Gibson) in congratulating my hon. Friend the Member for Totnes (Mr. Mawby) upon the way in which he embarked upon the amendment of a difficult and complicated section of our law. I wholly support the intentions of my hon. Friend and of my hon. Friend the Member for Crosby (Mr. Page), who seconded the Motion, and also the attitude of mind displayed by the hon. Member for Clapham.
It is right that the sale of furniture should not be used simply as a dodge to enable people to obtain premiums for letting controlled premises, or premises which have become decontrolled in the last year or so. If that is done it is simply evading what Parliament has provided, namely, that premiums should not be taken upon the grant of such tenancies, or the assignment of a tenancy between an outgoing and an incoming tenant.
If the dodge is being widely used it is right that the criminal law should be strengthened. But I am bound to say that merely to read out a list of prices being asked for furniture does not seem to prove in the slightest degree that those prices are excessive. If those cases are genuine cases of excessive prices being asked for furniture I cannot understand why the local authorities concerned have not already taken active steps to launch prosecutions under the existing law.
666 The difficulty I feel about the Bill is that not only does it fail to strengthen the law in the direction in which it ought to be strengthened, but it creates new criminal offences which are unenforceable, thus weakening the present law in some respects. The provisions allowing local authorities to obtain evidence are highly undesirable when considered in relation to the enforcement of criminal offences.
In the first place, we must remember that it is already a criminal offence under the 1949 Act to ask a price exceeding what is reasonable. That is the aspect of the situation to which Parliament should devote its attention. The law should be so designed as to stop people from asking too much money for furniture.
I concede, as my hon. Friend the Member for Crosby has pointed out, that the law is defective in that it creates a criminal offence only where a person has entered into a contract which requires the payment of an excessive price. It ought to be made a criminal offence to offer furniture at an excessive price. If people were prevented from offering furniture at too high a price the root of the difficulty would be reached. That is the real offence, which should now be covered.
But that is not what this Bill attempts to do. It at present creates two entirely new offences. First, under Section I (1, a) it makes it a criminal offence for anyone to
offer furniture at a price which he knows or ought to know is unreasonably high …I am quite unable to understand why that form of words is used. Prices and values of furniture are largely a matter of opinion. Within fairly wide limits the opinions of experts will differ as to what is a reasonable price for furniture.
It is true that there are occasions when people ask a sum of money which is obviously fantastic and grossly excessive, and when nobody could say that it was not. That is the circumstance which ought to be aimed at. Why provide, then, that it shall be a criminal offence, and that the prosecution must prove that the seller either knew or ought to have known that the price was excessive? If that is the sort of thing that is being aimed at it is wholly unnecessary. Why try to ascertain the knowledge of the seller?
667 If the price is excessive, then the seller ought not to have sold it whatever his knowledge. That is what we are aiming at. Therefore, the simple and proper way in which to have amended and strengthened the criminal law in this direction was to have made it an offence under Section 6 (2) not only to require but also to offer furniture at an unreasonably high price.
All of us who have practised in the courts know the utter difficulty of trying to prove what a man knew or what he ought to have known. Let us not do that, but stick to the main point, which is to prevent furniture either being sold or offered at an excessive price.
The second criminal offence which is created is that of failing to provide to a person to whom one intends to let or to transfer a tenancy a written priced inventory of the goods to be sold with the tenancy. I am bound to say that I think that my hon. Friends the Members for Totnes and Crosby have looked only at those who commit this type of offence, very frequently through agents, and have entirely forgotten the vast body of ordinary people who let or assign tenancies.
I suspect that well over 50 per cent., and perhaps 75 per cent., of the transactions in houses and flats are dealt with under what is known as the "old boy act" by letting to a friend. When one's tenancy is coming to an end, one meets someone who says, "Can you arrange for me to take over your flat?" One replies, "Of course". One may meet somebody at a party, or in a "pub", and there try to arrange terms to see if one can assign the flat to that person.
Many people, not big property owners, who have part of a flat or a cottage to let only want to let it to someone whom they know and whom they would like to have as their tenant and with whom they would fix up the transaction on a conversational basis. Yet by the provisions of the Bill as at present drafted every one of these quite innocent people will be committing a criminal offence unless they have in their possession, or produce, a written priced inventory of the goods in the property before they discuss terms with the person interested in taking over the property. If one has a nice little cottage in the village which one would 668 like a worthy person to have, and it has a gas cooker or a piece of furniture in it which has to be transferred, and a prospective tenant asks to have it because the sitting tenant is about to leave, what is one to do? Under this Bill, one will be committing a criminal offence if one discusses any terms at all unless a written, priced inventory is produced.
It seems to me that the proposers of the Bill have fallen into the error into which so many people fall in thinking that the criminal law is strengthened in some way by the production of written evidence. That is a fallacious view which laymen often take. In fact, of course, the strongest evidence which the criminal courts usually have is the oral evidence of an honest, decent person. If such a person comes along and says, "I was shown round the flat and there was a dirty old piece of lino and a broken-down chair for which I was asked £500," how on earth does it strengthen any case to know that there is a written document which shows something quite different?
The courts can proceed quite easily upon the oral evidence of responsible people, and they are often very much better off if they do so. It does not necessarily strengthen the criminal law to insist on written evidence of a transaction. It is really a terrible burden to provide that everyone who is about to let or assign a flat, house or cottage must in all circumstances, if there is a single piece of furniture or fitting in the property, produce a written, priced list of what that furniture is and commits a criminal offence if he does not.
Therefore, I regard both the proposed offences in the Bill as, first, objectionable; secondly, ineffective; and, thirdly, not likely to strengthen the criminal law. I concede that the criminal law should be strengthened, but it should only be strengthened by making it an offence to offer furniture at an excessive price.
I turn now to what the Bill proposes concerning powers of entry. I am bound to say that so far as those powers are concerned they strike me as being most unusual for the purpose of enforcing the criminal law. My hon. Friend the Member for Crosby said he thought that there were such powers under the Food and Drugs Act. But those powers are powers of entry into business premises. They are general powers of supervision, to 669 inspect how a business is being carried on and not powers to search people's private homes for evidence of a criminal offence.
Even the furnished houses rent tribunal which deals with the question of furniture in houses has no compulsory powers of entry into furnished houses in the discharge of its duties. I would also point out that the power conferred upon the local authority is almost without limit and could quite plainly be used for an oblique purpose. I do not suggest that it would be, but it might be. On occasion it might be used for gaining access to premises for an improper purpose, and it is undesirable that the possibility of that happening should be permitted.
There is also a very unsatisfactory provision as to the authority which the man who arrives and knocks at the door has to produce. All he has to produce is a piece of paper, and if it purports to be the notepaper of the authority and bears a signature which might be that of any officer of the authority, then he appears, to the householder, at any rate, to be exercising his powers under the Act. It opens up very considerable opportunities for people who, for dishonest or other purposes, desire to acquire access to private residences.
In addition, I think that this is the only occasion of which I know on which the person who is responsible for launching a prosecution is given the power of deciding in his own cause whether he should exercise compulsory powers of entry and whether the grounds on which he intends to do so are reasonable. Moreover, I am not at all happy that the giving of 24 hours' notice is a good idea as far as enforcing the criminal law is concerned. It gives the suspected person a good opportunity to refuse entry. A person is also given the opportunity of changing the furniture round or of getting up to a similar dodge which will enable him to evade the criminal law.
There is no limitation whatever as to the hours of entry, and persons could seek to enter premises under these powers by night or at any other inconvenient time within the 24 hours. I know that the Clause giving these powers as drafted is based upon Section 159 of the Housing Act. 1957, or so it appears. Of 670 course, Section 159 of that Act deals with cases where a house is to be demolished or compulsorily purchased, or where a closure order is to be made, or something of that nature. These circumstances do not have any criminal consequence. They are merely an enforcing by the local authority of its right to enter into premises for civil purposes, those premises being premises which are, to a large extent, already under its own control.
I quite see that the criminal law requires strengthening in this respect to obtain evidence that offences of this nature are being committed. I should like to suggest that the correct procedure to follow is that which the criminal law usually follows, namely, that of a search warrant. My hon. Friend the Member for Crosby said that if there was a failure to obey the notice and the occupier did not allow an authorised person to enter, the local authority could, of course, always apply to the courts for a search warrant.
That is wrong. They cannot. Justices can only issue search warrants in specific cases for which there is a statutory authority and none now exists in these cases. The usual method of obtaining a search warrant is when one lays information on oath. The warrant is obtained from a justice of the peace. The procedure has to begin by someone laying the information on oath before a justice of the peace and he says whether there are circumstances in which a search warrant should be issued. There is a great difference between that procedure and the sort of procedure in which a local authority would decide, without any formal information being laid on oath or in any other way, that it was reasonable to enter private residential premises.
There are other examples of circumstances in which a search warrant may now be applied for, such as in connection with dangerous drugs, for Customs purposes, to search for illicit stills and spirits or intoxicating liquor, or in respect of children and young persons. Incidentally, the last named is a relevant example, because private residences are entered to see whether children are living in them under proper conditions and are being looked after properly. Search is also made for obscence books. There are a few other circumstances in which Parliament has held that it is essential that 671 private residential premises should be entered in order to enforce the law. I cannot imagine why that principle should be departed from in this instance.
In the Children and Young Persons Act, 1933, the provisions are strict. As is usual, a search warrant must be applied for by information on oath laid before a justice of the peace. The warrant must be executed by a constable in uniform to prevent any possibility of a breach of the peace. The constable may be accompanied by the informant and also by a qualified medical practitioner. Were that sort of procedure followed in this case, a constable would execute the search warrant. He could be accompanied by a representative of the local authority and the complainant. In such circumstances, and under the strict control of the courts, it might he possible to search for proof whether there was or was not evidence to support a prosecution.
In a more recent example the Protection of Birds Act, 1954, Parliament has provided that a search warrant should be issued by a justice of the peace following information on oath that there were reasonable grounds to suspect that an offence had been committed under the Act, and that evidence was likely to be found on the premises which it was proposed to search. A warrant can then be issued and a constable can then enter and search the premises only for the purpose of obtaining evidence that such an offence has been committed. These well-known provisions of the criminal law are wise. They enable it to be said that an Englishman's home is his castle, which is something that we should all preserve. I believe that the law should be amended to make it an offence to offer furniture at an excessive price, without more being done to create additional criminal offences. The provisions in this Bill for searching houses for evidence are, in my opinion, wholly undesirable.
I sympathise with and consider it right, proper and necessary that steps should he taken to prevent these things. But I think that the new offences which would be created by the Bill, and the methods of enforcing the law proposed in the Bill, are wholly objectionable and, that being so, I must, with regret, vote against the Bill.
§ 12.24 p.m.
§ Mr. A. E. Hunter (Feltham)
I am pleased to join with my hon. Friend the Member for Clapham (Mr. Gibson) in congratulating the hon. Member for Totnes (Mr. Mawby) on introducing this Bill. I am certain that, although it may be a modest Measure, it is a step in the right direction. Hon. Members on both sides of the House have been concerned with the hidden premium racket. I was surprised by the speech of the hon. and learned Member for Warwick and Leamington (Mr. John Hobson) which seemed to reveal a lack of knowledge of this social problem. I am sure that the Parliamentary Secretary, who represents a Liverpool constituency, and many other hon. Members will know of the great social evil created by the shortage of houses in the cities and towns.
It is not the case that all landlords or agents are bad, but there is always a certain section of the community ready to exploit any situation such as that caused by the housing shortage. There are many agents and sub-agents who operate this premium racket and who have come into existence since 1945. They must be dealt with, just as during the war Parliament had to deal with unpatriotic people who were operating a black market. It is no use anyone saying that the hidden premium racket does not exist. In places like London. Liverpool, Birmingham and Glasgow and in areas of Middlesex and in Greater London one can find evidence of this racket being operated in the form of offers of fittings and furniture at exorbitant prices, by unscrupulous persons who are exploiting the housing shortage.
The columns of any evening newspaper contain advertisements offering fiats comprising three rooms or four rooms complete with fittings and furniture at prices ranging from £400 or £500 up to £1,000 in the case of property in places like Kensington, Westminster or Mayfair. In other areas in Greater London, Middlesex and Surrey, at places such as Hammersmith, Islington, Streatham, Richmond and Twickenham, there are small flats of two or three rooms offered at £200 or £300 with fittings and furniture. Cases have been drawn to my attention where the fittings and furniture comprised two or three lampshades, with a square of lino on the floor. Surely no hon. Member would defend the practice of taking 673 advantage of the housing situation in that way.
I hope that we shall have an opportunity to discuss the Bill in Standing Committee and to strengthen its provisions. As I say, there are good landlords and agents who do not charge premiums, but a bad element has come in since 1945. I could give the House many examples of the way in which people have been exploited in this way. Any hon. Member who operates a constituent "surgery" must have had experience of constituents coming to him at their wits end to find accommodation and complaining of the hidden premium racket.
Only recently I was approached by some old-age pensioners who had had to give up the house in which they lived and who were looking for a small fiat. They would have been content with two rooms in which to spend the evening of their lives, but they had been asked as much as £80 or £90 for such accommodation, including a few articles of furniture of no value. In other cases I know of people have bought the furniture and fittings and have had to remove the furniture because it was worthless and unsatisfactory. The Bill will not interfere with a landlord or tenant who wishes to sell furniture at its proper value.
Surely we should give the Bill a Second Reading. It will not harm the good landlord or agent and it will assist thousands of people who are searching our great cities for somewhere to live and who have not the means to pay the exorbitant sums demanded from them by those who operate this premium racket.
§ 12.30 p.m.
Major W. Hicks Beach (Cheltenham)
I will begin by apologising to my hon. Friend the Member for Totnes (Mr. Mawby) and my hon. Friend the Member for Crosby (Mr. Page), because I was not able to be present when they moved and seconded the Second Reading of the Bill, which, I understand, they did excellently.
I fully support the principle of the Bill, but, as a practising solicitor—I should disclose that straight away—who has some experience of the Rent Restrictions Acts, I have to say, with great regret, that I do not think that the Bill as drawn will really assist in the problem, although, as I say, in principle, I consider that it should be solved. I should not dispute for a moment that if Parlia- 674 ment, by legislation, thinks it proper to prevent premiums being demanded in certain circumstances, and it is found that, by jiggery pokery—if I may use that expression—the legislation is being got round, steps should be taken to put the matter right.
I do not think that the situation will be put right by this Bill. I should like it also to be on record that it is my view that, if the legislation is really being got round to any large extent, that is something which ought to be dealt with by the Government. In the course of my remarks, I shall seek to show—I have considerable experience of these matters—that, in practice, if one conies down to practical details, the problem is not half as great as some hon. Members seek to suggest.
My hon. and learned Friend the Member for Warwick and Leamington (Mr. John Hobson) stated, in extremely fair terms, what he regarded as the legal position. I heartily endorse what he said. Indeed, in the few notes which I have prepared, I had put down a number of similar points which I had intended to make, but, since I do not wish to weary the House with repetition, I shall not now make them. I approach the problem in rather a different way, because my hon. and learned Friend is a member of the Bar and I am a solicitor. I, as a humble solicitor who has had to advise clients in the first instance ever since I qualified in the early 'thirties, have tried to persuade myself at one time or another that I understood the Rent Acts. I have eventually come to the conclusion that I do not understand them.
The Rent Acts, I think, are the classic example of piecemeal legislation which, in the end, does harm when it is put on the Statute Book bit by bit over a period of years. I shall not weary the House with details of how, from the legal point of view, the present rent restrictions have arisen. There has been a series of Acts, since before 1914, all half dealing with the problem. Since 1920, there have been many. This particular Bill, I feel, will merely add to the problem.
I want now to consider one or two broad principles. By Clause 1, the House is being asked to create two quite new criminal offences. Let us not deny that. I think I shall have the approval of everyone in the House when I say that one of 675 our first tasks should be the protection of the liberty of the subject, ensuring that quite unpractical provisions creating criminal offences are not put on the Statute Book. I am sure that that will be accepted by both sides.
I believe that the two new criminal offences created by paragraphs (a) and (b) of Clause I (1) are quite unnecessary at the present time. They would be totally incapable of enforcement or, if attempts were made to enforce them, they would create an offence which, in many cases, would cause great hardship. As my hon. and learned Friend the Member for Warwick and Leamington very cogently pointed out, we are here asked to impose restrictions on the sale of furniture which, in a great number of cases, will be quite impossible to enforce, and I do not think that any amending legislation, as this really is, should be introduced for that purpose.
§ Mr. Gibson
Is the hon. and gallant Gentleman, therefore, suggesting that we should just leave this racket as it is and let people carry on as they are?
Major Hicks Beach
If the hon. Gentleman had studied the problem and had had practical experience, he would find that it is half the racket that some hon. Gentlemen suggest.
Major Hicks Beach
It is really quite easy. I will try at once to explain to the hon. Gentleman, to assist him, what steps can be taken to deal with a great number of these rackets. He obviously has been given extremely bad advice and, judging from what he has said, has not been giving people in his "surgery" the assistance they should have. I will deal with it straight away.
I had hoped not to go into details, but if the hon. Gentleman talks about "legal rackets," I must. I know that the hon. Gentleman is very well versed in this matter but, for the purpose of my explanation. I should read out the provisions of Section 13 of the Rent Act, 1957:As respects grant, renewal, continuance or assignment at any time during the period of three years beginning with the commencement of this Act, a tenancy excluded from the application of the Rent Acts by reason only of the provisions of subsection (1) or (2) of 676 section eleven of this Act or of those provisions and of subsection (7) of section twelve of the Act of 1920 … shall be treated as one to which section two of the Landlord and Tenant (Rent Control) Act, 1949, applies.Put in broad terms, that means that no premium must be charged. I do not want to read the provisions of the other Acts.
§ Mr. Hunter
Does the hon. and gallant Gentleman agree that charging for furniture and fittings which are not worth what is asked for them makes a hidden premium?
Major Hicks Beach
If I am to be allowed to develop my argument, I shall give both the hon. Member for Feltham (Mr. Hunter) and the hon. Member for Clapham (Mr. Gibson), a little advice on how this matter can be dealt with quite easily, from the legal point of view.
Major Hicks Beach
Under the law as it stands at present—I will not go into all the details of house tenancies, because it would take me half an hour—we all accept that, in certain circumstances, a premium is chargeable. That is common knowledge.
If anyone enters into an agreement and an improper charge is sought to be made—I did not hear all that was said, but I understand that it was alleged that fabulous figures for premiums were being charged—the person concerned should consult a responsible solicitor. If a premium of, £200, let us say, is charged for what hon. Gentlemen have described as a few sticks of furniture, the tenant has a very easy remedy, because the contract is illegal. All he need do is to apply to the courts for such part of the contract to be rescinded, that is, the premium, and he will still have the tenancy which has been created. I think that that is quite clear and perfectly simple. All that the hon. Member for Clapham has to do is to advise his constituents to see a responsible lawyer.
§ Mr. Gibson
Supposing a woman of about 55 conies to one and says, "I have not got a penny, and this is what they are doing," is one to advise her to spend a considerable amount of money, employing solicitors and going to the court? Even though perhaps she might win in the end, she will still have to pay; but 677 she has no money. What can the hon. and gallant Gentleman say about that?
Major Hicks Beach
The hon. Gentleman is rather unlucky in his constituency. Either he has not had good advice or he has not set up a poor man's lawyer organisation. Perhaps he has not the assistance of a citizens' advice bureau. I am trying to help him. He should start an organisation known as the poor man's lawyer so that cases like that can be dealt with.
§ Mr. Mawby
I am following my hon. and gallant Friend's argument very closely. He seeks to show that, under the present law. the tenant has a way of overcoming the problem. But is it not true—or am I completely wrong —that, where money has changed hands, the tenant who has paid is just as guilty in law as the person to whom he paid it?
Major Hicks Beach
All I can say to my hon. Friend is that he is, in fact, completely wrong.
May I now continue? There is, therefore, a remedy under Section 13, for anyone who enters into such a contract. Something has been said about oral contracts. I have not read the rest of the Section, but, if hon. Gentlemen want me to do so, I will.
Major Hicks Beach
Provided that this subsection"ߞthis will take me back to the 1949 Act. because I shall then have to refer to that, but I shall do so if hon. Members want itߞshall not affect the assignment of a tenancy granted before the commencement of this Act and not renewed or continued thereafter, being a tenancy to which subsection (7) of section twelve of the Act of 1920 applies.Here, I must apologise to the House, because I have not the 1920 Act with me. Section 13 (2) of the 1957 Act reads:An order under subsection (3) of section eleven of this Act may provide that the foregoing subsection shall apply in relation to the 678 order as it applies in relation to subsection (1) of the said section eleven, but with the substitution for the period mentioned in the foregoing subsection of such period, beginning with the date as from which the order excludes the application of the Rent Acts and ending not later than three years thereafter, as may be specified in the order.I did not read the whole Section before; I tried to summarise it by saying that it means that, in certain circumstances, to demand a premium is illegal. My argument is that in the majority of cases where an illegal premium has been charged, the assignee—that is, the person who is getting the tenancy—has a remedy under the Section if he takes the appropriate legal action open to him.
The hon. Member for Clapham read out a great number of cases from the London area. I am a practising solicitor, and I do a lot of work in the London area, but I would not accept in their entirety all the cases that he has read out. It is quite easy to read a number of constituency cases, but one has to ask oneself how many have been settled on a satisfactory basisߞߞ
Major Hicks Beach
I will try to answer the hon. Gentleman's argument as far as I can, but if I can pursue my observations on the Bill itself. I think that I will give the House more assistance.
As I have said, paragraphs (a) and (b) of Clause I (1) create two completely new criminal offences, with the large penalty of £100, but in my view. by far the most serious paragraphs are (a) and (b) of subsection (2).
Let me say about the subsection in general that it is my viewߞand I have stated it on numerous occasions in this Houseߞthat where a prosecution takes place it should be at the instance of the police. I appreciate that under the Food and Drugs Act there are certain cases in which, as the law stands, local authorities have to take action, but I still feel that any prosecution against the private citizen should, as a general rule, take place at the instance of the police. Here, as I understand it, the prosecution will take place at the instance of the local authorities.
679 I do not want to criticise my hon. Friend's drafting but, surely, if we are to say:Any notice under this subsection may be given by postwe should, at least, add the qualification "by registered post".
Turning to subsection (2, a)—only twenty-four hours' notice having been prescribed, we have the words:… where such a notice is given "—that is, the notice prescribed in the Bill:any person authorised by the local authority may at any reasonable hour on the specified date, on production, if so required, of some duly authenticated document showing his authority, enter the premises and inspect the Furniture therein;".I must confess that that frightens me very much, indeed. I feel most strongly about this, and fully support what has already been said; that if there is to he any entry authorised by this House without a proper search warrant being issued in the normal way by the magistrates, it will be a most retrograde step and a gross interference with the liberty of the subject.
If the Bill gets a Second Reading— and I hope that it will not, because it is not a practical Measure at all, but if by some unhappy chance it does—I hope that the promoters will give very careful consideration indeed to Clause I (2, a) and (2, b), which I regard as highly unsatisfactory and a gross interference with the liberty of the subject.
I should like to mention another small point—and here I invoke, if I may, the assistance of those who are much more skilled than I in local authority affairs. This is a drafting point. Clause I (5) says:… and 'local authority' means the council of a county borough "—I think that this is an important point, and it is one that affects my constituency—county district or metropolitan borough or the Common Council of the City of London, or as respects Scotland ….There I will leave it as I am not well versed in what applies to Scotland. Is it quite clear to the promoters that that wording includes an ordinary borough council and, if so, which is the wording? I am advised that it does not, and I should like someone to clear up my difficulty on that score.
680 I conclude by once again placing on record my view that this is a totally impractical Measure. It will create more difficulties in the interpretation of the Rent Restriction Acts and—what is, perhaps, most important of all—it will entail a gross interference with the liberty of the subject.
§ 12.47 p.m.
§ Mr. William Yates (The Wrekin)
When, yesterday, I asked my hon. Friend the Member for Totnes (Mr. Mawby) about this Bill, it seemed to me that he was introducing a necessary social Measure with which I, and, perhaps I might say, the majority of my hon. Friends, had a great deal of sympathy. They, too, wish to remedy the rackets that are taking place in our cities, and they also wish to give some answer to constituents who come to their offices and say, "Look at what is going on here. What shall I do about it?" In such circumstances, a Member of Parliament can advise the aggrieved person to consult a lawyer; and we have just heard a reasoned dissertation on the law by my hon. and gallant Friend the Member for Cheltenham (Major Hicks Beach).
Yesterday evening, however, as I read the Bill very carefully, and considered the other advice that I was given, I found that, while the object of the Bill is wholly desirable, the way in which it is drawn, and the way in which it provides some new forms of crime, simply horrified me. This morning I had made special note of the powers to be conferred on local authorities by Clause I, subsections (2, a) and (2, b). Surely we in this country have already given local authorities and the local authority officers too much power. Indeed, far too much power is delegated to them.
I want my hon. Friend to realise that I have every sympathy with what he seeks to achieve, but that the Bill will actually empower a local authority officer, acting with the permission of the chairman of the council, to decide whether he thinks that there is reasonable ground for sending a letter to say that he intends to search someone's house to find out whether an offence has been committed, after which that council and that officer will be able to bring criminal proceedings. 681 I am sure that the House must really agree that the Bill, in its present form, would be bad legislation, and should not be given a Second Reading.
Another important point is the compulsory inventory. The speech by my hon. and learned Friend the Member for Warwick and Leamington (Mr. John Hobson) was extremely important. How many people dealing with small houses actually make a full inventory? Inventories are made by people who can afford to appoint a valuer or agent to prepare one. It is an additional cost. The Bill, therefore, places an additional cost upon small people who will not be able to afford it. Not all landlords are the wealthiest of men.
On looking at the Bill again I see that Clause 2 (5) states:In this Act 'furniture' means fittings and other articles …To my mind, that will cause even more complications in the interpretation of the law between furniture, fittings and all the other matters that one has to deal with in the courts in connection with furniture, fittings, tenant's fittings, and so forth.
Neither myself nor any other hon. Member in any way seeks to prejudice any action that the House wants to take to bring to book people who are committing these acts of private piracy, but I believe that for the House to give a Second Reading to a Bill of this nature would be a mistake. If we are to have another Bill dealing with this subject, I suggest that subsection (1, a) of Clause I should remain, but that subsection (1, b), as well as paragraphs (a) and (b) of subsection (2) concerning the local authority, should be taken out. If a prosecution under subsection (1, a) is to be brought, it should be done in the normal way by search warrant sworn before a justice of the peace and in no other way.
I am very sorry that I have been unable to give support, as I would like to have done, to my hon. Friend the Member for Totnes and my hon. Friend the Member for Crosby. I have explained my reasons for not being able to support them in a Measure which, I believe, is designed to do good but which, in its present form, is unsuitable.
§ 12.53 p.m.
§ Mr. Dudley Williams (Exeter)
I should like, first, to add my congratulations to those of other hon. Members who have 682 paid tribute to the skill with which my hon. Friend the Member for Totnes (Mr. Mawby) has introduced the Bill. No tribute from me is necessary to my hon. Friend the Member for Crosby (Mr. Page), who is well known for his activities here on Fridays and in Standing Committee C, for the skill with which he has seconded the Motion for Second Reading today.
Let me say, at the outset of my re marks, that I have a personal interest. I live in a basement flat in Kensington, although not the flat to which the hon. Member for Clapham (Mr. Gibson) referred. I hope shortly to move to another flat and I hope also to dispose of some of the furniture in my Kensington flat to my hon. Friend the Member for Weston-super-Mare (Mr. Webster). The price that he pays will be a fair one.
The speech by my hon. Friend the Member for Totnes was in many ways quite powerful in favour of his Bill. Once or twice, however, he got on to rather thin ground—for instance, when talking about the prices paid for curtains and carpets which may be disliked by the incoming tenant. Under the Bill as my hon. Friend has drawn it, it would appear to be possible for an incoming tenant to say that the price was unreasonable even if he did not dislike the curtains. Everyone knows that what is good value for one person may be very poor value for another.
My hon. Friend made the point that his Bill would protect people who did not have sufficient capital to put down to buy a house. From the figures we have heard mentioned today, I would have thought that if people had enough money to pay these relatively high premiums they would have sufficient money to put down to purchase a house for themselves, especially when one considers the great benefits that the Government are giving to house purchasers. I would not have regarded that as a valid reason for saying that the Bill was particularly necessary.
The Bill is far too vague to command the support of a majority of the House. Vagueness in matters of the law can lead to serious trouble. I am reminded particularly of the Diplock case, I think it was, in which a gentleman died leaving a considerable sum of money to charitable or benevolent institutions. When the executors wound up the estate, they proceeded to distribute the money to what 683 they thought were charitable or benevolent institutions. Some of it went to build wings of hospitals and some of it for other purposes.
In due course, a relative of the deceased wrote from Australia and said, "I have no money. In fact, I am a charitable or benevolent institution. Where do I come in?" There was quite an uproar when the communication was received by the executors and the unfortunate relative in Australia got a dusty answer. However, he was not entirely set back by this rebuff and he hurriedly went to a reputable and expert solicitor in Melbourne, who sent a telegram to the executors instructing them to take no further action in distributing the money and stating that it was proposed to bring an action in the courts.
The court held that the will was void because it was too vague and all the money which had been distributed had somehow or other to be got back again to go to the next-of-kin of the deceased. I believe I am right in saying that the probem has not yet been settled. Nobody knows how to get the money back. That is the sort of difficulty which is encountered when anybody introduces into the House of Commons legislation which can be knocked out on the basis of being vague.
This is a very vague Bill indeed. My hon. Friend the Member for The Wrekin (Mr. W. Yates) made what I considered to be a valid point. He said that the Bill refers only to the price for furniture. When one moves into a new flat or house one often has many things done to it. When I took my small flat in London I had to have a considerable amount of electrical wiring done so that I could have a lamp standard here and there and other appliances. This can mount up to a heavy sum. Under the Bill, anybody would be entitled to say, "You can have the furniture at the price the valuer puts upon it, but my value for the electrical improvements which I have done will be extravagant."
So I think it would be a Bill which it would be very easy for any disreputable person to get round. I do not think that it will achieve the object which the hon. Gentleman obviously is seeking. I think that that is a point which ought certainly to be considered when we consider the question of sending the Bill to Committee.
684 On a point of order, Mr. Deputy-Speaker. May I draw your attention to the fact that there are fewer than 40 Members present?
§ Notice taken that 40 Members were not present;
§ House counted, and, 40 Members being present—
§ 1.1 p.m.
§ Mr. Dudley Williams
I am sorry that hon. Gentlemen are not staying to hear the further remarks I wish to make about this Bill.
I have been dealing with the question of getting round the Bill and how that can be done. I have no doubt that there are many methods by which the Bill could be got round. One could say that an incoming tenant must purchase, before taking over the flat, not only the furniture but some of one's clothes, and that the clothes were all excessively valuable, and so on.
Now I come to the use of the word "unreasonable" In Clause I (1) there is the statement that it shall be illegal for a person to offerthe furniture at a price which he knows or ought to know is unreasonably high".This, I think, will raise very considerable difficulties for all the people concerned. The word "reasonable" constantly comes in a later part of the Bill, too, to which I propose to refer shortly later on in my speech.
But what does the expression "unreasonably high" in Clause I (1, a) mean? Who is to discover whether it is an unreasonably high figure or a reasonable figure? I think great difficulty will be caused by this. What are we to do? Presumably the information is to be laid by someone that a man is going round offering to sell furniture upon leasing premises.
Let me make myself perfectly clear. I am not in favour of being swindled by having to pay £500 for a curtain rod and a bit of linoleum. I am not in favour of that at all. I am against the Bill only because I think it is a clumsy method of attaining the desirable objective, the absolutely desirable objective, my hon. Friend the Member for Totnes wishes to attain.
§ Mr. Doughty
Does my hon. Friend realise the impossibility of making what 685 one would think a fair valuation of the furniture? Is the value to be that which it would have at an auction? Or is it to be its original value less so much for every year that has passed since it was purchased? Is it to be its value to the person who sells it, or its value to the person who buys it? There is no definition of valuation or reasonable price in the Bill.
§ Mr. Dudley Williams
I agree with my hon. and learned Friend. It is extremely difficult to decide what is a fair value. One could say that if right hon. and hon. Gentlemen opposite were to get into power again the price of any furniture ought to be doubled because we should have inflation back again ripsnorting right through the economy and that, therefore, it would be reasonable to charge double what one paid for the furniture oneself. I do not know what the word "reasonable" means at all.
What I think will be extremely difficult under this Bill is this. First, somebody has to lay information before the local authority that he thinks that some person is offering furniture at an unreasonably high price. How is he to find out that it is unreasonably high? Is he to have to take professional advice, and have professional experts look at the furniture before he buys it or before he makes this allegation?
It. is a dangerous thing to go round saving that someone is committing a criminal offence, and saying that to the local authority. I think I am right in saving that that would not be protected by privilege. One may say that sort of thing in this House of Commons, but if someone in my constituency came to me and said that lie was being asked an unreasonably high price for furniture, and would I take the matter to the local authority and get a prosecution instituted. I should be very cautious about doing it. I should be very careful indeed, because I think I could well find myself in serious trouble in saying that a landlord was committing a criminal offence.
One has to be very cautious. I do not believe myself that people will go to the local authority and make that allegation, even if the Bill becomes law, because it will be too dangerous, unless there is an absolutely flagrant case of a man having to buy a curtain rod and a bit of linoleum for £500 to get into a flat.
686 It would be a very dangerous thing to leave this expression "unreasonably high" in the Bill. Presumably, the Bill will have fairly exhaustive examination in Committee—
§ Mr. Dudley Williams
The hon. Gentleman knows more about these things than I do. I am not a lawyer. I would not like to say that lawyers like the word "reasonable" What I like, and what, I think, the public like is to see clearly defined laws, so that we know where we are and whether one is infringing them or not. It may be that lawyers like the word "reasonable" I should think it gives great opportunities for argument in the courts—
§ Mr. Dudley Williams
ߞand possibly they get large fees from anyone so unwise as to act under a vague law such as the one now proposed to us. We should try to protect ordinary citizens from being subjected to attack in the courts because of vague law which Parliament may pass, such as this law which is now proposed. I think that it would be very unwise and unfair to pass it for that reason.
I come now to the question of who decides what is reasonable. We have got to the stage where someone has been sufficiently impetuous to go to the local authority and accuse a landlord of committing a criminal offence by offering furniture at an unreasonably high price— a very dangerous procedure, as I said earlier.
§ Mr. Doughty
It is not only a question of saying whether the price is reasonable or unreasonable. There need be only "grounds for suspecting"—that is, all sorts of denunciations by unknown denunciators, secret information, letters slipped through the letter box, unsigned, anonymous letters.
§ Mr. Dudley Williams
Yes, that is true, in Clause I (2) there are the words:reasonable grounds for suspecting.
§ Mr. Dudley Williams
Anonymous letters, slipped through the letter box, as my hon. and learned Friend points out.
So we come to the stage that an allegation has been made. Presumably, there must then be an investigation, so we come to Clause I (2, a), by which, when the local authority has given notice to the landlord that it wishes to inspect his premises and furniture, it may send persons to inspect.
We are still left not certain whether a criminal offence has been committed. The person authorised by the local authority to make the inspection may get to the premises only to find that the furniture which is put in for sale with the lease of the property has a fair and equitable price put upon it. Meanwhile, of course, the subject has been attacked; he is the target of this; there is invasion of his home by the local authority. And then he is cleared, because it is found that there is nothing wrong, and everything is properly priced, and he has committed no criminal offence. The local authority has acted, as my hon. and learned Friend says, on information possibly stuck anonymously through the letter box.
I do not think that this is the sort of law Parliament ought to pass. Moreover, I think that the powers proposed to be given to local authorities by this Bill would not be favourably received by many of the local authorities. I am quite certain that my own local authority in Exeter would find it would not wish to operate this Clause. Furthermore, having decided to take action against the landlord or the tenant concerned it would, of course, be faced with this difficult problem of finding out whether or not the furniture offered for sale was offered at an unreasonably high price.
It is a very heavy burden to put on local authorities. Presumably, they will have to employ licensed valuers to find out whether the property was worth the money that was being asked. The hon. Member for Clapham, whom I am sorry to notice is not now in his place, spoke of a lady who had been asked £150 for the contents of a single-room flat and who said that they were not worth more than £75. That is probably not an unreasonable figure, because in the opening negotiations the tenant probably never expected to get the £150 he was asking and the lady put the figure as low as 688 possible. If she had gone on, she might have closed on a figure somewhere between £75 and £150 which both parties would have looked upon as reasonable.
I thought that the speech of the hon. Member for Clapham was rather spoiled by the fact that although he said people were asking £400 for the furniture of a two-room flat he did not say anything about the quality of the furniture. I can tell the House that when I furnished my flat it cost over £800, and for the quality of the furniture I do not think that it was unreasonable. That figure might be unreasonable if the furniture was of inferior quality.
If the hon. Member for Clapham had told us something about the quality of the furniture, which, I think, in one case, he said was valued at £1,000, more weight would have been attached to his speech. My hon. Friend the Member for The Wrekin made a more forceful speech, inasmuch as he gave examples of the actual furniture that would be handed over with the lease in due course. I thought that his was a more powerful appeal because, obviously, the amount of furniture that was to be handed over was worth nothing like the sum asked for it.
I feel that the Bill is not only undesirable in the way in which it is framed. but that it is unnecessary. There is not the slightest doubt that great benefits are accruing to the country owing to the wise legislation that has been introduced by my right hon. Friend the Minister of Housing and Local Government, especially where the renting of properties is concerned. We know about the difficulties raised in the House when the Rent Act was going through its stages, but I have always maintained that there will not be very much profit in the way of votes for the party opposite when the Rent Act has made its full impact.
I must not go too far on that subject, Mr. Speaker, otherwise you will intervene and say that I am "off the beam". I hope that you will not rule that expression out of order. I was, as you know, brought up in humble circumstance in the Royal Air Force and from time to time the vernacular of that Service creeps into my speeches.
The Rent Act has already had a very strong impact and I do not think that those gentlemen who ask extravagant 689 sums of money for furniture and fittings will have very much longer to profit by that sort of disreputable technique. I am not a London Member and I freely admit that the impact of the Rent Act is mare severe in London than in any other part of the country, but everywhere I go in London I see more and more "Flat to let" notices going up. The situation is getting very close to what it was before the war, when there was a wide variety of accommodation available at reasonable cost. No one can say that some of the prices paid for flats before the Rent Act became operative were reasonable. They were unreasonably low in many cases. I know of somebody who was living in an eight-room flat in the West End of London and paying £60 a year. That is an unreasonably low figure. I understand that the flat is now vacant and that it is the intention of the landlord to split it up into two or three flats to provide accommodation for some of our homeless families.
I know that my hon. Friend the Member for Totnes has said, and in this has been supported by my hon. Friend the Member for Crosby, that the Bill will have an effect during the interim period while the Rent Act works itself out. I do not think that we should pass laws to cater for this short period of time. The time is running out for the men who try to swindle tenants. I do not mean that the time is running out for discussion of the Bill. We have plenty of time to discuss it between now and four o'clock. Although I regret that I shall not be able to take up all the time available, because I have to attend to other matters, I will, if I may, take a little more of the time of the House before I sit down.
This is a problem mainly for London and the larger cities. I do not believe that all over the country this is a practice which can be reflected upon in the way that some hon. Members have reflected upon it today. It will he quite impossible, for instance, in the constituency which I represent, to make an extravagant demand on an incoming tenant for a piece of carpet. There would not be any chance of his paying it, and I do not think that this practice is being indulged in. I assure the House that to the best of my memory no case of that kind has been brought to my notice in the whole 690 time that I have been the Member of Parliament for Exeter.
When the Conservatives were returned to power in 1951 the housing problem in that city was deplorable. I am glad to say that owing to the activities of the Prime Minister, when he was Minister of Housing and Local Government, which have been admirably maintained by his successor, there has been an improvement in the housing situation. There is less opportunity now for people to make extravagant demands for furniture and fittings. That applies all over the country, with the exception of some of our larger cities. In particular, of course, the most acute problem is in London.
Here I stand with my hon. and gallant Friend the Member for Cheltenham (Major Hicks Beach), who took the point that if we are to have legislation of this nature, which infringes very seriously upon the liberty of the subject, it should be brought in as a result of action by the Government and not by a private Member. It is too serious a matter for a Private Member's Bill to be used to put a law about it on the Statute Book. Any such Bill should be brought in by the Government. If the Bill receives a Second Reading today, and I should not like to say whether it will get through or not, there is no doubt that very considerable alterations will have to be made to it in Committee.
It would be unfair, for instance, for the landlord or tenant who is selling furniture and fittings with the lease of a property, provided he is behaving in a fair way, not to be able to come to some agreement whereby both parties agreed that the price paid was fair. I do not know how such a provision would be worded. It would be a difficult thing to do. That is why I believe that a Bill on this subject should be brought in by the Government and not by a private Member. I should think that we could make a provision whereby, if the value of the furniture is over £100, it would be possible for the two parties concerned to get together and agree that the price was fair. Then no action would be taken under the powers given to the local authority.
The Bill is a serious infringement of the rights of the individual and I do not 691 like it for that reason. This is an obnoxious power to give to the local authority, who will not, I think, like to operate it. I do not think local authorities have facilities for valuing furniture, and I certainly do not like legislation to be passed by the House in which action can be taken by a local authority on receipt of an unsigned letter. I think it wrong for that kind of legislation to go on to the Statute Book.
As regards the danger to anyone who makes allegations about an individual to a local authority under the Bill, it would be wise for it to go out from the House that if the person concerned makes allegations which are subsequently found to be unfounded, he lays himself open for action for defamation. So I think it would be unwise for the Bill to be given a Second Reading without that caveat to anyone who perhaps proposes to take advantage of the powers under the Bill. It would be wrong for anyone to think that after the Bill became law he could say anything he liked about individuals without running the risk of being called into the courts to answer for it.
§ Mr. Doughty
Malice would have been assumed and it is a question of fact for the jury. It is dangerous to say that malice might not he found.
§ Mr. Dudley Williams
We have had that argument recently in this House on the question of the Strauss case, if I may be allowed to use that phrase. There, hon. Members were not concerned that they would lose a case for defamation. I think we all agree that if there was no malice we would win the case if we wrote to a Minister about a problem which reflected on the integrity of someone. What hon. Members did not want was for the other party to have the power to issue a writ, because once that is issued there is the cost of defending it. Anyone might find that he had qualified privilege and would win the action, but that would not stop him having to defend the writ and having to pay half the costs because the taxed costs might not cover the costs of the action. 692 I have made the points that I thought it desirable to make. I shall not support the Bill but if it goes to Committee, fortunately I am on Standing Committee C, so I shall then have the duty of seeing that it is carefully examined and suitably amended.
§ 1.23 p.m.
§ The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. J. R. Bevins)
I have no desire to curtail the discussion, but it might be for the convenience of the House if I say a few words at this point.
First, I congratulate my hon. Friend the Member for Totnes (Mr. Mawby) on his fortune in the Ballot and on the excellence of his speech. I also congratulate my hon. Friend the Member for Crosby (Mr. Page) on his speech in support of the Motion. It was to be expected that some critical voices would be raised against some of the provisions of my hon. Friend's Bill. Fortunately it is not my responsibility this afternoon to deal with those criticisms, but I will make one or two comments of a general character which may be helpful.
It has been made clear in most of the speeches to which we have listened today that hon. Members on both sides of the House have become increasingly concerned at the growth of this malpractice, as I think it is, of insisting on the incoming tenants purchasing furniture and fittings at an extortionate price as a condition of the granting of a lease. There is not much doubt that with a certain type of landlord, especially in the London and Middlesex area, this practice has become general. As my hon. Friend the Member for Crosby rightly said earlier, it is by no means merely a landlords' racket since it is not uncommon amongst tenants, who themselves are trying to assign the unexpired period of a lease.
As hon. Members well know, the position is that the ban on straight, direct premiums seems to be reasonably effective; but disguised premiums, in the form of excessive charges for furniture and fittings, are now being freely asked. The ineffectiveness of the law as it stands is due partly to doubt as to whether the offence has been committed until the money has actually been handed over.
Many of the criticisms this morning are ones of detail which ought to be considered during the Committee stage, 693 assuming that the Bill receives a Second Reading. I am certainly not standing at this Box claiming for my hon. Friend that the Bill is perfectly drafted since that may not be the case. In the view of my right hon. Friend, who has naturally looked at the provisions of the Bill, any Measure on this subject is bound to be somewhat in the nature of a compromise. We must be careful that in our anxiety to check these malpractices we do not put too great a burden on other people. Particularly we must not discourage the letting of furnished flats and houses because of what we are here seeking to do.
A good deal has been said critically— I do not complain of that—about the provisions referring to the power of the local authority to enter the premises in question. Those criticisms are natural and I am sure that my hon. Friend expected them. It is right that the House of Commons should look critically at provisions of this kind, and I say frankly that my personal prejudice is certainly against them rather than for them as a matter of principle.
The difficult question that my hon. Friend and his supporters have to face is whether, without some such provision ⁁I do not say the provision as it stands—the Bill would be worth while and whether it would achieve anything. I am not sure how in the absence of some such provision, the idea behind my hon. Friend's Bill could be enforced. We ought to remember that the Bill has been brought forward only because the existing legal provisions, which make it unlawful to demand an excessive price for furniture and fittings, have been ineffective. Hon Members know as well as I that in a matter of this sort good intentions are all very well but they are not sufficient.
I am bound to say that I think, personally, that Clause I (2) or something like it is necessary if the Measure is to work, and I say that because it does not seem to me that any local authority can be expected to embark on a prosecution until it has had the furniture inspected and a value placed on it by a competent valuer. It can hardly be expected to proceed merely on the word of the complainant. The complainant may be biased; he may dislike the person with whom he is trying to do a deal or he may 694 have little or no idea of the market prices of furniture and fittings. The prices given in the inventory may, on the face of it, look suspicious to the local authority, but only an inspection is likely to show whether they are fraudulent, and I do not see how that can be done unless there is an inspection, and I do not see how that can be carried out unless the question of access to the premises is satisfactorily settled.
We must bear in mind all the time that we are not trying to penalise the individual who puts a price of £100 on furniture and fittings which, strictly speaking, are worth perhaps only £70, £80 or £90. The person whom my hon. Friend the Member for Totnes is trying to catch is the man who embarks on a deliberate fraud through this malpractice.
On the question of entry, I also think that the House would be well advised to remember that here we are dealing with properties or premises which are on the market. Members of the public who wanted to inspect the house or the flat would, in the ordinary nature of the case, be admitted to the premises. Often—I agree not always—these premises will be vacant except for the furniture and fittings which the owner is trying to sell. That being so, I do not think that it is such a gross invasion of the individual's privacy that the local authority should have the right to inspect the premises if— and this is a proviso—it has reason to believe that too high a price is being asked. There are precedents for this in the Housing Act, 1957.
I know that some hon. Members think that if the Bill becomes law it will be very easy for unscrupulous and unprincipled persons to circumvent its provisions. As one hole is plugged another will appear. That may be true in the event, but the fact is that this dishonest practice is going on, to the knowledge of hon. Members, and Parliament has a duty to do all it reasonably can to stamp it out. Some people will always find a way round the law. The fact that some people devote great exertions to evading taxation, and sometimes succeed, certainly does not discourage the Inland Revenue from trying to tighten the provisions against tax evasion.
What the Bill will do—and I think it will do this—is to make it more difficult for people to run this racket than it is at 695 present. That may be a limited purpose, but it is some purpose, and I think that there is a moral obligation upon the House to do what it can in this respect. As I said, there will clearly be a number of points of detail which will need to be considered very carefully if the Bill reaches Committee. I do not for one moment believe that my hon. Friend the Member for Totnes is wedded to all the provisions of the Bill and I am sure that he will welcome constructive criticism, and help, at the Committee stage.
§ Mr. Mawby indicated assent.
§ Mr. Bevins
Speaking also for my right hon. Friend, I can say that we regard the Bill as a worthwhile Measure and we hope that the House will give it a Second Reading.
§ 1.35 p.m.
§ Mr. James MacColl (Widnes)
I do not want to take long, because we have had a very full discussion on the Bill and there are many other important matters which the House wants to examine this afternoon. The whole proceeding has made me feel that at any moment I might wake up. It has been like a Christmas dream. I never thought that I should sit and nod with approval when the Parliamentary Secretary was making a case for giving to local authorities greater powers for intervention.
The Bill is a recognition of a need, and I am glad that the hon. Member for Totnes (Mr. Mawby) has used his good fortune to introduce it. I am also glad that he was able to obtain the support of his hon. Friend the Member for Crosby (Mr. Page). That, again, was unexpected. It rather takes the wind out of my sails. Again, it is a little like Christmas, because it was rather like having to cope with Scrooge introducing a Private Member's Bill for holidays with pay.
I am glad that the hon. Member for Crosby has been big enough to admit that some of the things he said on the Rent Bill in Committee have not proved correct. When the original new Clause dealing with premiums was introduced into the Rent Bill in March of last year, my hon. Friends made it clear that, although they welcomed it, they doubted whether it would be effective, and I believe that many of these doubts have been proved to be correct.
696 The hon. Member for Totnes talked about an acute local housing shortage. These are rather bad words to use. Surely there cannot be an acute housing shortage in these days, after so long a period of careful Conservative administration. Surely all that must have disappeared. He talked about the normal, disgruntled seeker after accommodation going to the town hall. I thought that nobody ever had to go to the town hall these days, looking for accommodation.
Nevertheless, I am glad that the hon. Member has recognised that these needs exist and has taken this opportunity to introduce the Bill. It is not a new principle—and that is a very important aspect of the Bill. The criticisms which have been made of it have either been criticisms of detail for Committee, or a challenge to the whole idea of doing something about the furniture racket. The principle was established a very long time ago, as the hon. Member for Crosby said. There is nothing new in trying to deal with extortionate charges for furniture.
The only issue is whether we can make this effective. I think it is common ground among most people who know what is going on that the present provisions have not proved effective, and I therefore think that we ought to do what we can to extend the powers to enforce what everybody agrees ought to be the law. It would be rather feeble of the House, faced with the obvious fact that the law is not working, to back out of it and to say, "We will do nothing about it." I think that it is right that we should try to strengthen the law.
There are points in the Bill on which I agree that examination in Committee may cause substantial changes. For example, I am not convinced that Clause I (1, a), introducing the fact that the offer is at a price which he who made the offerknows or ought to know is unreasonably highwill strengthen the law. I should have thought that the test is whether the court holds that it is unreasonable. To have to go into what the owner ought to have known will introduce further refinement which, if anything, will weaken the enforcement of the law.
I cannot see that all these objections to the written inventory have much foundation. If two people are making a 697 deal about furniture on an amicable transfer of interest it does not seem difficult for them to get a sheet of notepaper and jot down how much furniture is involved and make an inquiry as to what the items are worth. The danger is that people apply a global figure, perhaps £500, which does not really bear any relation to the item. It is reasonable to ask them to itemise the articles.
The picture of local authority officers bursting into houses in the middle of the night to see whether a carpet has a tear in it is a fantastic distortion of what happens. The Bill makes it clear that the entry must be in reasonable time.
Major Hicks Beach
The hon. Member says that it is a fantastic picture of local authority officers bursting into houses in the middle of the night. That does not happen because the law does not allow it to happen.
§ Mr. MacColl
I was about to say that the law allows it to happen. Public health inspectors have considerable powers for enforcing the Public Health Acts, such as in looking for overcrowding. I suppose there is nothing to stop a public health inspector bursting into a house to count the number of people sharing a bed, but it is unusual for that to be done in the normal practice of local authorities. Local authorities normally behave in a sensible way.
§ Mr. MacColl
From time to time wage claims are made by local authority officers, and I should not like to say anything to embarrass those claims. Many local authority officers have to work overtime to catch people in when they want to obtain entry to a house in a perfectly proper way. We must recognise that local authorities are sensible, responsible people who carry out their duties in a sensible, responsible way and can be relied upon to do so.
Subject to the improvements which will no doubt be made in Committee, I suggest to my hon. Friends that the Bill is a worthy attempt to tighten up the law dealing with what is generally agreed to 698 be a deplorable racket which we all want stamped out. I therefore hope the House will give the Bill a Second Reading.
§ 1.43 p.m.
§ Mr. Charles Doughty (Surrey, East)
I congratulate my hon. Friend the Member for Totnes (Mr. Mawby) on his efforts to deal with what everybody agrees is a racket, but my congratulations cannot go any further because the drafting of the Bill is something which the House ought not to pass as lightly as it appears to be doing. Saying that there is an evil and that the Bill is being introduced to cure it does not necessarily make the Bill a good one. We have here an evil which ought to be cured, but this is not the way to do it.
I share the surprise felt by the hon. Member for Widnes (Mr. MacColl) that the Parliamentary Secretary should express approval of a Bill which gives local authorities a right to enter a person's house by law. This is contrary to all my principles, unless there are very strong grounds, such as ill-health or sanitary reasons. The proposed extension is not one which I could approve.
We all know that this racket exists. We cannot just say that we know it exists, nor is the matter carried very much further by reading out a long list of houses and the prices asked for furniture and fittings, as was done by the hon. Member for Clapham (Mr. Gibson).
§ Mr. Doughty
It does not prove that it exists. All it has proved is that here are flats vacant and that prices are being asked for furniture and fittings. There are two fundamental flaws in that argument. First, those were the prices which were being asked, but there is not the slightest reason to suppose that some figure far less would not be accepted. If the hon. Member had ever dealt in horses he would know about the prices asked and the counter offers which are made for a long time.
Secondly, one has never seen the furniture. Some furnished flats, if they are fully furnished and fully carpeted and curtained, are necessarily very expensive, and some of the figures read out by the hon. Member do not, prima facie, appear to be at all extraordinary. In saying that, 699 I am not stating that this type of extortion does not exist—we all know that it does—but this is not the way to deal with it.
When we look at the Bill to ascertain whether it deals with the problem we want to know what the position is at the present time. There are at present ample powers provided by the Labour Government in 1949. The Measure introduced then was a renewal and extension of old powers, and the 1957 Act was a further extension to houses which are decontrolled. The powers are perfectly simple. Section 3 of the 1949 Act reads:
Where … whether before or after the commencement of this Act the purchase of any furniture, fittings or other articles has been required as a condition of the grant, renewal, continuance or assignment of a tenancy to which the last foregoing section applies, and … the price exceeds the reasonable price of the articles, the excess shall be treated … as … a premium ….In other words, by asking too much one has asked for a premium.
So that there shall be no ambiguity about it, the next subsection reads:where after the commencement of this Act any such purchase as is mentioned in paragraph (a) of the last foregoing subsection is required as therein mentioned, the price demanded shall, at the request of the person on whom the demand is made, be stated in writing; and if, without reasonable excuse, a person required to give such a statement in writing fails within fourteen days to do so, or knowingly gives a statement which is false in any material particular, he shall be liable on summary conviction to a fine not exceeding ten pounds.A premium, including one given in a disguised form as an excessive price for furniture, can be recovered by the tenant and the tenant can also remain in the premises, and the person who has demanded the premium is guilty of an offence for which he is liable to a fine of up to £100.
§ Mr. J. A. Sparks (Acton)
With the coming into operation of the Rent Act, 1957, in respect of decontrolled dwellings the security of tenure has now disappeared. If a tenant took such action as the hon. and learned Gentleman suggests can be done, the owner would get his own back by serving notice to quit on the tenant, and the tenant would have to get out because he was living in a decontrolled house.
§ Mr. Doughty
The provision is under the 1949 Act, and it applies to houses which are controlled. It is not a question of decontrolled houses.
§ Mr. Sparks
My point is that the circumstances today are completely different from what they were then, because a large number of houses have come out of control. The value of that part of the Act is slowly disappearing as the decontrol of houses progresses.
§ Mr. Doughty
That is dealt with in another part of the 1957 Act. Certain houses which are decontrolled remain covered, but there are nearly always three-year agreements.
Of course, there will be times when, as the houses become decontrolled, there will be ordinary contracts as a matter of bargaining between the parties. That is fundamentally a very good thing. The fewer artificial restrictions that there are on private bargaining the better, if there is no distortion by shortages.
My hon. Friend the Parliamentary Secretary said that the Bill required alteration in a few details. It wants to be scrapped and rewritten. That can be done in Committee, but the Bill does require a great deal of amendment. The points to which I propose to refer are matters of principle and not Committee points. Some of the Bill's provisions are thoroughly bad and must be remedied if the Bill is to have the slightest chance of reaching the Statute Book.
There are two fresh criminal offences in the first Clause. Under the first of them, any person whooffers the furniture at a price which he knows or ought to know is unreasonably high …is guilty of an offence. I have already discussed horse dealers with the hon. Member for Clapham. For all he knows, and for all I know, the figures which he read out may have been excessive and may have constituted an offence under the Bill. However, would it be a defence for the landlord to say, "That was my asking price. That was what I was asking. As a matter of fact, I did not get anybody to look at the premises. I had it on my hands for a long time and I would have taken anything I could have got. I asked £450, but I would have taken £50."? According to the Bill, such a landlord would have committed an offence by making that opening bid. 701 That is making something criminal when it was never intended.
As I have frequently pointed out, although a licensed valuer may be asked to value the furniture, there would still be very great difficulties. The first questions he would ask would be, "On what basis do you wish me to make this valuation? Is it what you will expect to get for the furniture if it is sent to an auction room? Is it the original cost of modern furniture, less so much depreciation? Is it to be taken as being of a higher value because it is situated in rooms which it suits and where the carpets and curtains fit the floor and windows?" It is an almost impossible task and a task on which people can honestly differ.
The second offence is failure to furnishto any person seeking to obtain or retain accommodation whom he provides with particulars of the tenancy, a written inventory of the furniture, specifying the price sought for each item.On a strict reading of that paragraph, all the particulars in the list of the hon. Member for Clapham constitute an offence, because in each case a total sum is given.
Suppose that a house agent has to send out lists of houses and flats where the furniture is to be sold. In such a case he will have to send out lists of the furniture in the flats. The list of the hon. Member would run not to three or four pages, but to 300 or 400 pages, because, instead of having the expression "F. and F. £400," there would have to be a list of everything from the sofa to the curtains. To put it mildly, that would be ridiculous.
Having dealt with the first part of Clause 1, let us consider the thoroughly objectionable part of the Bill, the part which must be excised. That is the snooping, the encouragement to snooping. Someone who has a grudge against another person can indulge in such a practice. I hope that when the Bill returns from Committee this part of it will have been totally changed.
In ancient Venice, there used to be a lion's mouth into which people were encouraged to put denunciations of each other. Even in certain modern States, I believe, that is still the case. This is exactly the same thing. This is encouraging the slipping of denunciations through the lion's mouth. [An HON. MEMBER: "Good idea."] It is a rotten idea. It 702 is a horrible idea that people should be encouraged to go to local authorities with tales about each other, or even send an anonymous note—and there is nothing to prevent that—and, in any case, nearly always actuated by spite.
The Bill says:Where a local authority has reasonable grounds for suspecting ….Is the local authority to employ somebody to look through the papers every day and to decide whether advertisements constitute prima facie evidence, or is it to wait until a complaint is made? If a local authority has to wait until a complaint is made, my remarks about snoopers and denunciations are entirely justified. That is why that part of subsection (2) is something to which I take the strongest objection.
As a result of that suspicion, a local authority is to be able to demand the right of entry into somebody's house. [An HON. MEMBER: "Unoccupied."] It is no good saying that it may be unoccupied. What does it matter? It belongs to somebody and, in all probability, since we are considering furnished premises, it will not be left unoccupied with all this valuable furniture inside, for that would be most unwise. A tenant who is considering leaving when a fresh tenant is found tells the landlord and the landlord says that he will try to find another tenant.
The occupying tenant, with no interest in the bargain, is then served with a notice by the local authority to say that the local authority intends to come in to value the bed on which he sleeps and the chair on which he sits and the carpet over which he walks. That is highly objectionable.
§ Mr. Dudley Williams
On a point of order. Is it in order for the word "hell" to be used in the House? I heard the hon. and learned Member for Northampton (Mr. Paget) make use of that word and I suggest that it is not Parliamentary.
§ Mr. Doughty
Even the place to which the hon. and learned Member refers, at any rate, in the context in which he used the word, causes me no fear.
The gas meter is not valued, nor does a man enter a house to read a gas meter, except by contract with the occupier, who is entitled to have the gas meter taken out and to tell the gas man to go away.
If the entry is obstructed or refused, by a person who may have no concern or interest in the bargain, the landlord is liable to a fine not exceeding £20. I am strongly opposed, as I am sure are many of my hon. Friends, to this right of local authorities to demand entry and to have the right of entry into people's homes.
§ Mr. Dudley Williams
During the whole of this debate we have had no protests of this nature from hon. Members opposite. It appears that they have no regard whatever for the liberty of the subject.
§ Mr. Doughty
I am obliged to my hon. Friend. It is clear that they wish to encourage public authorities to enter people's premises and inspect their furniture. It is the hon. Members on this side of the House who wish to protect the individual and the rights of the subject, and who will continue to do so.
§ Mr. Doughty
I am pointing out to my hon. Friend the Member for Totnes that his Bill contains certain defects, which we shall no doubt be able to put right in Committee. But certain major alterations are required. I compliment my hon. Friend on his general idea, which I support. I say again that the general idea is a sound one.
§ Mr. A. Evans
On a point of order. Are you aware, Mr. Deputy-Speaker, of 704 any tedious repetition going on in the Chamber? It appears to me that we have heard this argument over and over again, and that the Minister has replied to it. I submit that we are now having tedious repetition.
§ Mr. Dudley Williams
Surely it is not in order for hon. Members to say when there is tedious repetition. This is a matter which is entirely at the discretion of the Chair. Am I not right?
§ Mr. Deputy-Speaker
I have been listening to these legal arguments, which are very complicated. It does seem that the arguments are being put at rather great length.
§ Mr. Doughty
That is because of the interruptions, Mr. Deputy-Speaker. They make my speech longer, although they do not put me off my stroke. I am thankful to hon. Members opposite for drawing my attention to various points, which I hope I have dealt with to their satisfaction.
I have now come to the end of my serious criticisms of the Bill. There are other more technical matters with which we need not concern ourselves today. The Bill seems as if it will obtain a Second Reading, which makes it necessary for me to point out that it requires a major surgical operation when it goes to Committee. When it comes back to the House I hope that it will do what my hon. Friend the Member for Totnes and many other hon. Members, including myself, wish it to do, but in a very different form from its present one. I hope that the Committee will strike out the very objectionable subsection which gives a local authority power to receive anonymous information and then enter the homes of our people as of right.
§ Mr. Sparks
On a point of order. As the Bill has the general approval of both Front Benches, and the debate on one side of the House has exhausted itself, will you accept the Motion, That the Question be now put, Mr. Deputy-Speaker?
§ 2.5 p.m.
§ Mr. Harold Gurden (Birmingham, Selly Oak)
I intended to speak in support of the Bill, but I have been considerably disturbed by the arguments used 705 against it. Nevertheless, I still think that there is a need for some sort of legislation in this matter. The House will recall that it has supported the idea of the continuance of controlled rents, for the time being. We have had the Rent Act, which was obviously designed to free property from control at the earliest moment, but that Act recognised that some properties still needed to be controlled, purely because of the extreme shortage of accommodation. As time goes on, however, and those properties are vacated and new tenants come in, they will be freed from rent control.
So long as we recognise a need to have some control of rents we must prevent this back-door method of extracting money. In 1945, after the election, I was forced to obtain living accommodation in London, and I had to pay several hundred pounds for the furniture and fittings in a flat. I recognised that the rent of the flat was extremely low and was certainly not yielding a profit to the very good landlord, and that the tenant at the time had just cause to ask me for double the value of the furniture, because he had paid a considerable sum to the previous tenant and he was not making a profit out of me. When I averaged out the price of the rent and furniture, including depreciation, over the term of the lease, I found that it was still a very cheap flat. I could not see anything wrong in the sum asked.
§ Mr. Gurden
Recently I wished to dispose of the flat and, with an expert, I worked out a figure which took account of fair depreciation of the furniture and also the depreciation of the value of the lease, and finally asked £150 less than I had paid. It was a fair price by those standards, but it could have been claimed that I was asking more than the furniture was worth. However, we all know that some people would act with different motives, and would have sought to extract another £50 or £100 from the incoming tenant. It is therefore clear that some protection must be provided to would-be tenants. This will be only a temporary Measure, since, by virtue of the continuing decontrol of property, the need for it must ultimately fade out.
I have been extremely disturbed by the arguments submitted by my hon. Friends 706 against the Bill. My hon. Friend the Member for Totnes (Mr. Mawby) will probably agree that the Bill could have been better drafted. Nevertheless, it is fair comment for him to say—as he has said to me in private—that he is quite willing to have the Bill very fully considered in Committee, and perhaps to accept some Amendments. It is because of that that I support the Bill. I could not support it otherwise, in view of the arguments put forward by my hon. and learned Friend the Member for Surrey, East (Mr. Doughty) about snoopers. If it were not for the fact that I believe that we can evolve something in Committee which will make the Bill acceptable to the House at a later stage, I should not be able to vote for it. The rights of the individual must be protected. If two people wish to enter into a contract—
§ Mr. Gurden
I am trying to make a short speech, and I am at least supporting my hon. Friend in this matter. It is not my wish at all to waste the time of the House. After all, it is only ten minutes past two o'clock, Mr. Deputy-Speaker, and both you and I have known occasions when hon. Members opposite have filibustered throughout the debate.
I was saying that I believe it is most important that Members of the House should protect the freedom of the individual to enter into a contract if he so wishes. It is because of the control from which we have suffered for so long in the past that we have to have this sort of thing. We should make the matter complete for the time being. At a later date, as I have said, it will automatically fade out.
I hope that my hon. Friend the Member for Totnes will accept the Amendments which will undoubtedly be put down during the Committee stage. If they are not put down, then, of course, there may be many of us who will have to oppose the Bill on Third Reading. Whatever the ultimate result of this 707 debate may be, I hope that my hon. Friend will be encouraged to pursue the matter as far as he can.
§ 2.13 p.m.
§ Mr. Richard Body (Billericay)
I propose to say only a very few things about the Bill because, like other hon. Members, I look forward to the debate which will take place on the next Measure. However, having supported the Bill from the outset, I wish on this occasion to add a few words in its support.
It has been described as a snooper's Bill, but, of course, local authorities must be given the right of entry into premises if they are to be given the duty of bringing the prosecutions.
§ Mr. Body
My hon. Friend the Member for Exeter (Mr. Dudley Williams) says that they ought not to be given the duty of prosecuting. I believe that it would be very unwise and a very great mistake if private prosecutions were brought by would-be purchasers and others who would really have no standing in the court to prosecute.
§ Mr. Doughty
My hon. Friend is arguing entirely on the wrong basis. Why should not the duty be placed upon the police to carry out the prosecuties?
§ Mr. Body
My hon. and learned Friend the Member for Surrey, East (Mr. Doughty) knows well enough that private persons bring many prosecutions. It is not only the police who prosecute. Prosecutions concerning houses and matters of that sort are far better left in the hands of local authorities than in the hands of the police. The police are concerned primarily with criminals in the ordinary sense of the word and not with people who have been acting wrongly as landlords.
§ Mr. Dudley Williams
It is all very well for my hon. Friend to say that, but, in fact, under the Bill the local authority is empowered to enter a person's property if some one decides to push a letter of complaint, perhaps a mischievous letter of complaint, through its letter box. It is absolutely monstrous that such a power should exist.
§ Mr. A. Roberts
On a point of order. May I point out, Mr. Deputy-Speaker, that all these arguments are absolutely synthetic?
Major Hicks Beach
Further to that point of order. Surely, Mr. Deputy- Speaker, it is not the usual view of the House to suggest that one should not argue on a Bill.
§ Mr. Dudley Williams
On receipt of a letter through its letter box, a letter probably sent only for mischievous reasons, the local authority is entitled to burst into someone's house and start valuing the furniture.
§ Mr. W. Yates
Would my hon. Friend give one reasonable ground on which a local authority might take such an action?
§ Mr. Body
The answer to that seems quite simple. A reasonable ground would be if a bona fide prospective purchaser, having been confronted with a bill for furniture and fittings, went to the local authority, to its housing department, for instance, and said, "Look here, this prospective vendor is asking £500 for some curtains and a few sticks of furniture". If it is palpably a false matter and obviously designed to circumvent the existing legal protection for prospective purchasers, then there on paper is a prima facie case against that prospective vendor.
In those circumstances, the local authority would be absolutely entitled, in my submission, to go to that prospective vendor and ask him for some explanation, to go in and see for itself whether the figure of £500 bore any resemblance to the true value of the articles. Only if the figure were out of all proportion to the real value would the local authority consider bringing a prosecution.
My hon. Friend must realise that once one takes a defendant to a court all the rules of evidence and procedure balance down in his favour. The prosecution 709 must prove beyond all reasonable doubt that the guilt is on the shoulders of the defendant. Unless it could be established quite clearly by independent valuers that the furniture and fittings were worth very much less —very much less, I emphasise that—then no prosecution would stand.
I believe that once enacted the Bill would be a sufficient threat against those people who, acting in bad faith, try to make an undue and unfair profit out of the housing shortage, and, in particular, against those people who seek to abuse the existing legislation. It is for that reason that I have supported the Bill all the way along the line.
All who live in the London area must know of instances where the existing law is abused in this manner, instances of a few sticks of rubbish being sold for £500 or some other amount on the pretext of being furniture and fittings. That is no more than asking a premium, and it is a dishonourable way of getting round the law.
There is only one thing that I have against the Bill. It is that there are many people who have had to succumb to these
§ pressures and who, in the past, have had to pay very substantial sums of money for furniture and fittings. No doubt they did so with the thought in mind that when the day came for them to sell they would be able to recover that same £500, or whatever it might be, by selling the same furniture and fittings to the next purchaser.
§ As I understand it, those people will suffer as a result of the Bill being enacted. It will mean that they will be unable to recover the sum of money which they in their turn were forced to pay when they originally bought the furniture and fittings. That may cause some injustice. But if any possible injustice of that kind is compared with the advantages which will be derived from the introduction of this Measure, I am sure that hon. Members will be in favour of the Bill. Its enactment will close a loophole in the existing provisions and put an end to a practice with which I am sure no hon. Member would agree.
§ Question put, That the Bill be now read a Second time:—
§ The House divided: Ayes 60, Noes 7.709
|Division No. 16.]||AYES||[2.20 p.m.|
|Ainstey, J. W.||Gurden, Harold||Pentland, N.|
|Bevins, J. R. (Toxteth)||Hall, Rt. Hn. Glenvil(Colne Valley)||Pitt, Miss E. M.|
|Blenkinsop, A.||Harris, Reader (Heston)||Probert, A. R.|
|Blyton, W. R.||Hastings, S.||Reid, William|
|Body, R. F.||Heath, Rt. Hon. E. R. G.||Roberts, Albert (Normanton)|
|Boyd, T. C.||Holman, P.||Russell, R. S.|
|Broughton, Dr. A. D. D.||Hunter, A. E.||Sparks, J. A.|
|Brown, Thomas (Ince)||Hynd, H. (Accrington)||Stewart, Michael (Fulham)|
|Cliffe, Michael||Hynd, J. B. (Attercliffe)||Stones, W. (Consett)|
|Davies, Stephen (Merthyr)||Isaacs, Rt. Hon. G. A.||Sylvester, G. O|
|Deer, G.||Janner, B.||Taylor, Bernard (Mansfield)|
|Ede, Rt. Hon. J. C.||King, Dr. H. M.||Thomas, Iorwerth (Rhondda, W.)|
|Edwards, Rt. Hon. Ness (Caerphilly)||MacColl, J. E.||Vane, W. M. F.|
|Edwards, W. J. (Stepney)||McKay, John (Wallsend)||Wakefield, Edward (Derbyshire, W.)|
|Evans, Albert (Islington, S.W.)||Macpherson, Niall (Dumfries)||Williams, David (Neath)|
|Evans, Edward (Lowestoft)||Mason, Roy||Williams, Richard (Openshaw)|
|Finoh, H. J.||Mitchison, G. R.||Wilson, Rt. Hon. Harold (Huyton)|
|Gibson, C. W.||Oram, A. E.||Woodburn, Rt. Hon. A.|
|Grey, C. F.||Paget, R. T.||TELLERS FOR THE AYES:|
|Griffiths, David (Rother Valley)||Paling, Rt. Hon. W. (Dearne Valley)||Mr. Mawby and|
|Griffiths, Rt. Hon. James (Lianelly)||Paling, Will T. (Dewsbury)||Lieut.-Colonel Cordeaux.|
|Hicks-Beach, Maj. W. W.||Maddan, Martin||TELLERS FOR THE NOES:|
|Hobson, John(Warwick & Leam'gt'n)||Webster, David||Mr. Dudley Williams and|
|Kirk, P. M.||Yates, William (The Wrekin)||Mr. Doughty.|
|Langford-Holt, J. A.|
|Bill accordingly read a Second time.|
|Bill committed to a Standing Committee pursuant to Standing Order No. 38 (Committal of Bills).|