HC Deb 19 February 1964 vol 689 cc1263-75
Lady Tweedsmuir

I beg to move, in page 5, line 10, after "that", to insert, (i).

Would it be convenient if with this we discussed the next Amendment?

Mr. Speaker

If the House so pleases.

Lady Tweedsmuir

This is a drafting Amendment. This and the next Amendment divide the proviso of subsection (1) into two, which makes for easier reading. The second part rewords the addition to the Bill which was made in Committee by an Amendment moved by the hon. Member for Glasgow, Craigton (Mr. Millan). Subsection (1) provides, among other matters, that the surviving spouse of an intestate shall receive so much of the furniture and plenishings of the dwelling-house in which she is ordinarily resident as is included in the intestate estate. The hon. Member for Craigton moved and I accepted an Amendment providing that the furniture and plenishings to which the Clause applied should not exceed a value of £5,000.

At the time, the hon. Member said that he was surprised and gratified that his Amendment was being accepted without comment on its drafting, which he had put down in a great hurry. We naturally gave it closer study and we found that it was necessary to make a slight amendment to it, because what the hon. Member originally suggested made it possible that it might be interpreted as having the effect that where the furniture and plenishings were worth more than £5,000, the surviving spouse would get none of them, and that was not what was intended by the Committee. The Amendment ensures that the surviving spouse will be entitled to the furniture and plenishings to the value of £5,000, but no more.

Mr. Millan

This Amendment is an improvement. I thought that it was too good to be true that not only did the Government accept my Amendment, but actually accepted the exact wording. I agree that the present wording of the Bill is rather ambiguous and that the improvement maintains the sense of what was originally intended.

Amendment agreed to.

Further Amendment made: In page 5, line 14, leave out from "and" to end of line 16 insert: (ii) a spouse shall not be entitled under this subsection to receive furniture and plenishings in excess of a value of £5,000.—[Lady Tweedsmuir]

Lady Tweedsmuir

I beg to move, in page 5, line 32, to leave out "applies" and to insert "apply".

This Amendment corrects a grammatical error which arose from an Amendment which was made in Committee. I understand that this correction has to be made by a formal Amendment.

Previously, the Clause referred to one Act of Parliament and the relative verb was in the singular. It now refers to the Rent and Mortgage Interest Restrictions Acts, 1920 to 1939, and the verb should be in the plural.

Amendment agreed to.

6.45 p.m.

Lady Tweedsmuir

I beg to move, in page 6, line 1, to leave out paragraph (c) and to insert: (c) the value of the intestate's interest in the dwelling house exceeds £10.000. If it is convenient, there is also the consequential Amendment in page 6, line 25, at end insert: or the sum of £10,000, whichever is the less".

Mr. Speaker

They can be discussed together and it is probably also convenient to discuss the Amendments in the name of the hon. Member for Kilmarnock (Mr. Ross), in page 6, line 1, leave out "interested" and insert "having an interest", and in page 6, line 3, leave out "of a historical nature". These fall if the Government Amendment is accepted.

Lady Tweedsmuir

Thank you, Mr. Speaker.

This is an important Amendment. Hon. Members who were members of the Committee will recall that Clause 8(4,c) was subjected to a good deal of criticism and that further consideration of this paragraph was promised.

Briefly, the Clause provides that the surviving spouse of an intestate shall be entitled to have the deceased's interest in any dwelling house in which he or she was ordinarily resident at the time of the intestate's death and also to the furniture and plenishings of that house. However, subsection (4) provides that in certain cases the surviving spouse will get not the deceased's interest in the dwelling house, but a sum of money equal to the value of that interest.

One of the cases covered in this way by section (4) is that where, on the application of any person interested in the estate, the Court of Session, or the sheriff, is satisfied that there are special circumstances of a historical nature connected with the house which make it proper that the surviving spouse should have the value of the house, but not the house itself. This case is covered by paragraph (c) of that subsection.

In Committee, paragraph (c) was criticised by the hon. Member for Kilmarnock, the hon. Member for Glasgow, Scotstoun (Mr. Small) and the hon. Member for Motherwell (Mr. Lawson). The main grounds of criticism were that it was not clear who was entitled to make an application to the Court of Session, or the sheriff, for a declaration that there were special circumstances of a historical nature connected with the house and, secondly, the very difficult matter of the definition of circumstances of a historical nature.

The hon. Member for Kilmarnock suggested that the paragraph could be omitted altogether. This I promised to consider, but I also gave a hint that I might consider the value of the house. After a great deal of thought—and in many ways there is hardly any part of the Bill which is more difficult—it was concluded that the paragraph suffered from the defects pointed out and that the best course was to omit it.

This we are therefore doing by these Amendments, but, at the same time, we are extending the device moved into Clause 8 in Committee by the hon. Member for Craigton. This is the fixing of an upper limit on the value of property which may be taken by the surviving spouse under this Clause. By the Amendment of the hon. Member for Craigton, a limit of £5,000 is placed on the furniture and plenishings.

The second Government Amendment places a limit of £10,000 on the dwelling house. This limit of £10,000 will apply in all cases and not merely in those which might have been covered by paragraph (c). On further consideration, I think that 10,000 is about the right sum and strikes a proper balance between the claims the surviving spouse and those of other relatives entitled to succeed to the intestate estate.

Mr. Ross

The Government are making a fundamental change, and one which I cannot readily support. What happened was that we gave the surviving spouse the right to the dwelling-house, or, if there was more than one, the house that she chose, in all cases of intestacy. That met one of the main causes of complaint in relation to the position of widows under the succession law of Scotland. I think that the noble Lady will agree that that was widely acclaimed, and, indeed, improved the Bill as we orginally knew it.

Certain questions arose when we discussed subsection (4) and the exceptions; when we discussed the cases in which it would be possible for persons, for some reason or other, not to be granted this right. When we discussed this in Committee, I was struck by the looseness of paragraph (c), and I wanted to know why any person interested in the estate —that is a rather loose definition, because interest in an estate is not the same as having an interest in the estate; and I think that that was admitted by the noble Lady—should have the right to go to the Court of Session or the sheriff and plead special circumstances of a historical nature connected with the dwelling-house.

With all due respect to the noble Lady, I cannot readily see any connection between meeting the objection to that provision by taking out the provision altogether, and meeting it by making a limitation on the value of the house. I am sorry that I did not hear the beginning of the hon. Lady's speech, but I gather that that is what is being done, and that the Government are limiting the application of this right in subsection (1) to a house costing less than £10,000.

I do not know whether the hon. Lady knows much about the property market in Scotland. I live at a seaside resort where fairly small houses fetch £10,000. It is most unfair of the Government to have made this fundamental change without consulting anybody. Certainly, they have not consulted anybody on this side of the House. Hitherto, our arrangements with the Government have been fairly amicable. I do not think that any consideration has been given to this matter. This limitation was not considered when the matter was discussed in Committee upstairs, and the hon. Lady then made no mention of this question of a dwelling-house of a special historic nature. If I remember rightly, all that she said on this subject was that there might be a family connection with the house.

I hope that we shall get some other explanation for what the Government propose to do. I hope that they will justify their action, because our information about the value of property is that the increase which has occurred in the past few years in proceeding apace, and it therefore does not seem satisfactory to replace the right which is given without restriction in subsection (1) by an overall restriction in paragraph (c). I am appalled by what the Government have done. I do not think that there is any justification for taking out an unlimited right and replacing it with a purely monetary right and a restriction which, with the passage of time, will extend to more and more property and undermine the right that we have given in subsection (1).

I do not know whether the Government have considered that aspect of the matter, or have thought about how many people will be offended at this seeming breach of faith. I hope that the hon. Lady will look at this again, and if the Government insist on fixing a sum, they should think again about whether they have chosen the right figure, because the one now in the Bill may mean the loss of a family dwelling-house to the surviving spouse, and I think that that is something which we all wish to avoid. We may find that what we hoped would be an established right is being frittered away because of an Amendment which was unforeseen and unforeshadowed in our earlier proceedings.

Lady Tweedsmuir

I should like to speak again as nobody else seems to want to speak on what I think is an extremely important Amendment.

The hon. Gentleman asked what was the thinking behind this provision. He will remember the debate in Committee. He suggested either that we should omit paragraph (c) altogether, or that we should try to define "historical nature" in a much more definite way. The two Amendments which the hon. Gentleman seeks to make—

Mr. Ross

I wanted more than that. I wanted a clear definition of who the persons were who could apply to the Court of Session, because the Clause as it stands refers to the application of any person interested which is very wide indeed.

Lady Tweedsmuir

That is true, and I see that one of the hon. Gentleman's Amendments tried to meet that point by substituting the words "having an interest" for the word "interest".

But apart from that, the main debate centred round the question of circumstances of a historical nature, and the second Amendment proposed by the hon. Gentleman would make paragraph (c) have a very wide definition indeed, because it would read: on the application of any person having an interest in the estate the Court of Session or the sheriff, on being satisfied that there are special circumstances connected with the dwelling-house which make it proper that this subsection should apply to the case… I said in Committee that we had had great difficulty in trying to define circumstances of a historical nature because it did not necessarily mean that the house in question was of historic or architectural interest: there might also have been reasons why the family felt that the house should remain within the family.

I added: …as the right hon. Gentleman rightly said, one of the great problems is the value of the house. The surviving spouse, if she did not take the house itself, because of historical reasons, would get the value of the house. That might be a very considerable sum in certain circumstances."—[OFFICIAL REPORT, Scottish Standing Committee, 21st January, 1964; c. 194.] That was what led us to the conclusion that the only way to get round this circumstance was to do what was done by the hon. Member for Glasgow, Craigton (Mr. Millan) in an earlier case of furniture and plenishings, namely, to apply an upper limit. The hon. Gentleman says, quite rightly, that property values vary greatly, and for all we know they may go up in the future. That applies to the whole question of furniture and plenishings.

7.0 p.m.

The question whether the sum should be £10,000 is a very difficult one to decide. Perhaps it ought to have been £15,000 or £20,000. As we know, we pass these Bills and we constantly have to deal with monetary values. Time passes, and we find it necessary to introduce amending legislation in order to bring certain penalties or financial provisions up to date. But at this moment in time we must take some decision if we are to have a financial limit of any sort. As the Committee found it acceptable to have a limit on furniture and plenishings I thought that it would find it equally acceptable to have an upper financial limit on the property, remembering that we are dealing mostly with small or medium-sized estates.

We gave an enormous amount of thought to the possibility of defining "historical nature" more closely, but we found it almost impossible to consider every sort of circumstance. I suggest that if we accepted the hon. Member's Amendments we should not be giving any guidance to the courts as to what we meant by "special circum stances". We might be asking any person with an interest in an estate to apply to a Court of Session or to the sheriff, maintaining that there were special circumstances connected with a certain house which meant that it should not go to the surviving spouse.

That being so, we cannot agree to a suggestion which gives the court of session no guidance at all as to what the special circumstances could be. I suggest that the acceptance of these Amendments would also leave the way open to the bringing of many court cases, which is the last thing that we want to do. The Amendments would leave the position too wide. The best thing to do is to impose an upper financial limit. Whether we now have the right sun is open to opinion. Considering the type of estate that we are dealing with, I thought that £10,000 would be fair, but I am prepared to consider a limit of £15,000 at a later stage.

Mr. Millan

I would ask the hon. Lady to look once again at the question of the upper limit of £10,000. We are here dealing with two entirely different matters. One is the elimination of paragraph (c). It is a matter of judgment whether vie should eliminate it altogether or try to amend it as my hon. Friend's Amendments would. If we retain the paragraph, even as amended, difficulties may arise in the shape of an increase in legal actions, and I believe that my hon. Friend would agree that there is something to be said for the Government's view that we should delete the paragraph altogether if it is found almost impossible to arrive at a precise form of wording.

The question of an upper limit of £10,000 is an entirely separate one. In Committee I moved an Amendment which imposed an upper limit of £5,000 on furniture and plenishings. I suggest that if we compared the figure of £5,000 for furniture and plenishings with any kind of upper limit value for a house we should arrive at a figure in excess of £10,000. This may not be important in the case of small estates, but we are not legislating merely for small estates. In many cases small estates will not have furniture and plenishings of anything like £5,000 it will be more like £500. But we may be dealing with quite large estates, and I would have thought that £10,000 was on the low side.

We have to anticipate increases in values. From bitter experience we have come to realise that we do not get Succession (Scotland) Bills very often. We have waited a very long time for this one, and we may have to wait a very long time for the next. By that time the figure of £10,000 may be very much out of date, if property values continue to increase as they have done recently.

In those circumstances, I hope that the hon. Lady will reconsider the question and will arrive at a figure which is more in keeping with the £5,000 for furniture and plenishings. The value of furniture and plenishings is not on all fours with the value of a house, because plenishings include all kinds of things, such as linen, china, glass, books and pictures, which may be extremely valuable. In those circumstances, I hope that the hon. Lady will agree to reconsider the matter. She will obviously not be able to do so now, but I hope that this will be possible before the Bill eventually passes through the other place.

Sir James Duncan (South Angus)

I was not in the Standing Committee on the Bill, and I did not realise that this point would be raised until I came in a short while ago and listened to the debate. It occurs to me that if my hon. Friend is going to reconsider the question of a limit of £10,000 she might also consider the method of arriving at the figure. One can always employ a certificated auctioneer to certify the value of plenishings and furniture, but there are different valuations in respect of house property. The value of the probate may be quite different from the value of the insurance.

We ought to insert a provision specifying who should carry out the valuation. It could be the district valuer, or the Inland Revenue authorities. Some words should be inserted, because in marginal cases we do not want arguments to arise between two valuers on the question whether a house is of greater or lesser value than £10,000. If my hon. Friend is going to reconsider the question of the figure she should also consider the method of arriving at the valuation.

Mr. Small

I wonder whether it would be possible to work on a percentage basis, beginning with the valuation of the moveable property. Having established the factual value of the moveable property—assessed by any mechanism we think fit—could we not use that figure as the basis for arriving at the global valuation? If we can be satisfied about the value of the moveable property we ought to be able to work on a percentage basis and arrive at an equitable value for the whole estate.

Mr. Hendry

I fully appreciate the difficulties which my noble Friend has met in framing the Clause. She did me the honour of discussing them with me at an early stage. I feel a little difficulty on this, because I agree with the hon. Member for Glasgow, Craigton (Mr. Millan) that there are two matters here which are becoming rather confused. I can, speaking from my own experience, imagine many houses of historical importance which are not worth anything like £10,000 but to which the Clause might properly apply. On the other hand, the question of an upper limit is a different question altogether.

I ask my noble Friend to reconsider this whole question with a view to tabling an Amendment in another place.

Mr. Speaker

The Question is—

Mr. Ross

I was hoping that we should get a reply from the Minister?

Lady Tweedsmuir

I thought that had said, on the question of the £10,000 limit, that I recognised that there were difficulties in fixing the right sum. At this stage in our proceedings what I suggest is that I will not persist in the Amendment in page 6, line 1, because I will in fact undertake to consider what the sum should be. Therefore, the thing to do would be to leave paragraph (c) as it is now, unless the hon. Member for Kilmarnock would like to move his Amendment in page 6, line 1, which would have the effect of inserting the words "having an interest", which I should be glad to accept.

However, I should have to resist the hon. Member's Amendment in page 6, line 3, to leave out "of a historical nature", because I would not like to send the Clause forward in that way. If this were done, we would leave paragraph (c) as it now stands, except that we would have substituted for "interested" the words "having an interest". In the meantime, I will consider the question of the size of the financial limit.

Mr. Speaker

To get this right, I have to ask the noble Lady if she wishes to withdraw the Government Amendment in page 6, line 1.

Lady Tweedsmuir

I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Ross

I beg to move, in page 6, line 1, to leave out "interested" and to insert "having an interest".

I have no desire to move the Amendment in my name in page 6, line 3, which would leave out the words "of historical nature", even if you, Mr. Speaker, were prepared to select it.

Amendment agreed to.

Lady Tweedsmuir

I beg to move, in page 6, line 11, to leave out from "owner" to "value" in line 12 and to insert: a sum equal to the". Perhaps it be convenient to the House to discuss with this Amendment the Amendments in line 16, leave out from "tenant" to "the" in line 17 and insert: a sum equal to". And in line 26, leave out from beginning to "arbitration" in line 27 and insert: (5) Where any question arises as to the value of any furniture or plenishings or of any interest in a dwelling house for the purposes of any provision of this section, the question shall be determined by.

Mr. Speaker

Yes, if that meets the wishes of the House.

Lady Tweedsmuir

An Amendment to the Clause moved in Committee by the hon. Member for Glasgow, Craigton (Mr. Millan) introduced a money limit into the Clause. This is the limit of £5,000 on the surviving spouse's entitlement to furniture and plenishings and there would have been, if the Government Amendments had been accepted, a limit of £10,000 on the surviving spouse's claim to a dwelling house. The valuation of the furniture and plenishings can be disputed. It is, therefore, necessary to make provision for arbitration.

There is already provision for arbitration in respect of the intestate's interest in the house in cases where the spouse is to take the value of that interest instead of the interest itself. We thought that it would be convenient to collect the arbitration provisions in one place, and this is done by these Amendments. They have the effect of bringing all the arbitration provisions together in subsection (5).

7.15 p.m.

Mr. Millan

These seem to be drafting Amendments bringing all the references to arbitration into one reference in a new subsection. They are therefore agreeable to the House.

Now that the noble Lady is taking back the question of the upper limit of £10,000 and is to look at the whole matter again, I suggest that she looks at the drafting of subsections (4) and (5), including tie drafting that we are now considering. The drafting is clumsy. The fact that the Amendment referring to an upper limit of £10,000 has been withdrawn will make the Clause rather less clumsy than it otherwise would have been. The whole thing would benefit from a searching examination of the drafting. Perhaps the noble Lady will say that this will be done when she is considering the other points which she has already committed herself to consider before the Bill goes to another place.

Lady Tweedsmuir

As I know that the Parliamentary draftsmen simply love looking at drafting, it will be my great pleasure to have a look at it with them.

Amendment agreed to.

Further Amendment made: In page 6, line 16, leave out from tenant "to" the "in Line 17 and insert" a sum equal to".—[Lady Tweedsmuir.]

Lady Tweedsmuir

I beg to move, in page 6, line 20, after "subject", to insert "in either case".

This is a drafting Amendment. It does not in any way alter the meaning of the Clause. This part of the Clause says that the surviving spouse of an intestate shall in certain circumstances be entitled to receive the value of the intestate's interest in a dwelling-house, subject to any heritable debt that may be secured over that interest. The intestate's interest in the dwelling-house may be that of an owner or that of a tenant. The purpose of the Amendment is to make it clear that in either case the spouse is to receive the value of that interest, subject to any heritable debt that is secured over it.

Amendment agreed to.

Mr. Speaker: I take it that the noble Lady does not wish to move the Government Amendment in page 6, line 25, at end insert: or the sum of £10,000, whichever is the less".

Lady Tweedsmuir: No, Sir.

Amendment made: In page 6, line 26, leave out from begining to "arbitration" in line 27 and insert: (5) Where any question arises as to the value of any furniture of plenishings or of any interest in a dwelling house for the purposes of any provision of this section, the question shall be determined by.—[Lady Tweedsmuir.]