HC Deb 21 July 1967 vol 750 cc2722-30
Mr. Graham Page

I beg to move Amendment No. 1, in page 3, line 13, at the beginning to insert: (1) This section shall not apply to a dwelling house the legal estate in which is vested in persons who are spouses of one another either alone or jointly with other persons. Clause 2 deals with the registration of the right to occupy as a land charge against the property. The remainder of the Bill flows from the registered right in Clause 2. I should have hoped that the Bill would be used on very few occasions and that in future the matrimonial home would be taken in the name of the husband and wife jointly.

But that means that all the rather difficult provisions and procedure in the Bill might be avoided. It is not clear from the Bill that if the property is taken in the joint names of the husband and wife or in the names of themselves and other trustees the rights and procedure in the Bill are avoided.

Clause 1 refers to the spouse who is entitled to occupy a dwelling-house as against the spouse who is not. If a husband and wife own the legal estate jointly, subject to a trust for sale, it is not clear whether either of them can say, "I am entitled to occupy the property." They may both be entitled under the trust, or it may be a trust in favour of one of them. There may be innumerable ways of vesting the property in trustees for the benefit of those who it is intended shall reside in the property.

It is necessary that the Bill should make it clear that when the property is vested in the husband and wife all this trouble about registering land charges, and so on, can be avoided. If that is clearly said in the Bill, the practice will prevail of the legal profession advising the husband and wife, or the intended husband and wife, that the right thing to do would be to take the property in their joint names.

That does not mean necessarily that they share the value of the property or have to contribute to the purchase price in equal value. It merely means that the legal estate will be held by them jointly and that if any sale or other dealing with the property takes place, it can be done only by means of the execution of a deed by both spouses and not by one over the head of the other. I am sure that that is the right way to deal with the matrimonial home and I hope that this will be the way in which matrimonial homes are dealt with.

If that is to be the case, let us say clearly that the Bill does not apply to that sort of tenure of property. By the Amendment, I endeavour to say so at the opening of Clause 2. Clause 1 is left intact: it describes the rights of occupation of the injured spouse. I say "injured spouse" because these rights are likely to occur only in the event of estrangement and difficulties in marriage. Clause 1 describes those rights fully. Only after Clause 1 comes the machinery for creating, by means of a land charge, something which the public will then know exists.

My Amendment would leave the definition of the rights of occupation as they are given in the Bill. It then states that if the legal estate of the property is held by the husband and wife, there is no need to proceed with the registration of the right of one spouse to occupy. The right of that spouse to occupy will be fully protected by the fact that no conveyance or other disposition of the property could take place other than over the signature of both spouses.

Mr. S. C. Silkin

I am still not clear about the situation which the hon. Member envisages. The essence of Clause 1, to which he referred back, is that there must be a situation in which one spouse is entitled to occupy by virtue of an estate or interest and the other spouse is not so entitled. Those are the express words. That, presumably, is the condition precedent to the whole of the Bill. In other words, it applies equally to Clause 2 as to Clause 1. If that is so, I am still not clear—the fault is, no doubt, entirely mine—how the situation can arise in relation to Clause 2, to which the hon. Member has addressed his argument.

Mr. Graham Page

I can satisfy the hon. and learned Member by referring to a case—I do not think it matters that I am now disclosing the facts of a client's case, because it is some public knowledge —in which there is a compulsory purchase order on a matrimonial home. The home was bought by the parents when the wife was an infant under the age of 21 on the occasion of the marriage. The parents were not very certain about the boy whom she was marrying, so they bought the house as a gift to their daughter. They put it into their own names and the wife was the beneficiary under the trust. That is an occasion when property was put into the names of trustees other than the husband and wife.

The same situation could arise if the parents had been satisfied of the husband. They might well have put the property into the legal estate and the names of the husband and wife but named the wife, their daughter, as the beneficiary. That is an example.

That being so, whether or not they are beneficiaries, either party has the right to occupy; the legal estate is vested in the two of them. The whole purpose of the Bi11 is that the legal estate in the property shall not be conveyed away without the consent of both spouses. If the legal estate is already vested in both spouses, there is surely no need for either of them to go to the extent of registering a land charge and all the palaver and increased cost of conveyancing which would result from Clause 2 onwards of the Bill. I want to relieve those who already hold the legal estate jointly from any further trouble under the rest of the Bill.

2.15 p.m.

Mr. Archer

Bearing in mind the elegance and precision of the customary draftsmanship of the hon. Member for Crosby (Mr. Graham Page), I must confess that when I first saw the Amendment it gave me a nasty turn. I tried to imagine persons who are spouses of one another either alone or jointly with other persons". For a shocked moment, I thought that the hon. Member was contemplating polygamy. I now appreciate what he had in mind, and I agree entirely with his first point.

Normally, a solicitor will be able to avoid all the difficulties which the Bill is designed to meet by advising a husband and wife who contemplate acquiring a matrimonial home to take the legal estate in their joint names. If that happens, the difficulties which the Bill is designed to meet will not arise and there is no need to worry. If there is no problem, we do not have to argue about the solution to it.

There are, however, situations—for example, in the instance cited by the hon. Member to my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin)—in which, for one reason or another, those who supply the money are opposed to the principle that the parties shall take the legal estate jointly. That is the situation which the Bill contemplates.

Perhaps I may respectfully add my voice to those who, on occasions throughout these debates, have invited the intervention of my right hon. and learned Friend the Solicitor-General. I am aware that the practising profession would welcome guidance as to the kind of advice which they might give to clients in this kind of situation and I would welcome it if my right hon. and learned Friend saw fit to intervene.

The difficulty which the hon. Member for Crosby contemplates does not, however, appear to me to arise, because the first words of the Bill exclude the situation which he has in mind. If the legal estate is vested jointly in the two spouses, the Bill does not apply. That is stated precisely by its opening words. The example given by the hon. Member to my hon. and learned Friend the Member for Dulwich does not take the matter any further, because in that example such rights as they were—rights of the beneficiary under a trust—were in one of the spouses and the other had no similar rights.

Clearly, in that kind of situation, we would not want to exclude the operation of the Bill. That is the situation which the Bill contemplates. If the two spouses had taken rights in their joint names, the problem would not have arisen and there would be no need for the provisions of the Bill.

There are, however, two possible situations. One partner might need protecting because he or she does not have a legal interest in the property. In that case, the Bill operates or the partner does not need protection, in which event the operation of the Bill is excluded by the opening words. I do not see the difficulty.

The Solicitor-General

I intervene in response to the invitation of my hon. Friend the Member for Rowley Regis and Tipton (Mr. Archer), though I think there is very little I can add to what has been said by my hon. Friend and by my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin). I would agree with them that where we have a legal estate vested in two persons, as contemplated here—and I take it that the wording of the Amendment means simply a husband and wife—then the protection which is afforded by this Bill is unnecessary, and indeed the Bill does not apply. Clause 1 contemplates a state of affairs where one spouse is entitled to occupy the dwelling-house by virtue of any estate or interest or contract or by virtue of any enactment giving him or her the right to remain in occupation, and the other spouse is not so entitled.… It is simply to meet this state of affairs that the Bill has been introduced.

In Committee, and throughout, we have been considering the most common case, which is where the husband leaves the matrimonial home, the legal estate in the house is vested in him, and then he requires the wife to leave; and the purpose of this legislation is to give her a statutory right to remain. Of course, if there is a joint legal estate it means the husband and wife are both owners, and if the husband leaves the matrimonial home the wife already has a right to remain there, because she is one of the owners of the house.

The Bill has no application to that state of affairs. Therefore, while I appreciate the concern of the hon. Member for Crosby (Mr. Graham Page) in bringing forward this Amendment, I would advise the House that the Amendment is quite unnecessary.

Mr. S. C. Silkin

Far be it for me ever to attempt to gild the lily which sits on the Treasury Bench, but since my right hon. and learned Friend referred specifically to the legal estate may I say that it seems to me, at any rate—I say this in answer to a point made by the hon. Member for Crosby (Mr. Graham Page) —that what he said applies just as forcefully to any equitable estate. Clause 1 applies to one spouse being entitled to occupy the dwelling-house by virtue of any estate or interest of contract and "interest" must, include a beneficial interest arising in equity.

Therefore, whoever may be the owner of the legal estate, if in equity, as a result of the sort of causes he referred to, one spouse has entitlement to occupy and the other does not have entitlement to occupy, then we have a situation which Clause 1 contemplates, but if the equities are such that both have a right to occupy then we do not have that situation and the Bill does not bite on that situation at all. Therefore, with very great respect to the hon. Gentleman, it does seem to me that both in the legal and the equitable situation his Amendment is wholly misconceived.

Mr. W. O. J. Robinson (Walthamstow, East)

I am trying to visualise a house where there are separate legal estates—where, for example, the freehold estate is owned jointly by the husband and wife. As I read the Amendment the fact that the freehold estate was owned jointly would exclude that dwelling from the operation of the provisions of the Bill. There might be in existence a leasehold estate owned by the husband only, a separate person entirely. If that be so and my premises are right, the wife of the leaseholder would not be able to register the estate because the dwelling house would be excluded from the operation of the Bill.

Amendment negatived.

Mr. Graham Page

I beg, to move, Amendment No. 2, in page 3, line 29, to leave out 'unless' and to insert: 'or (c) the delivery of an application for the cancellation of the charge in accordance with subsection (2) of section 4 of this Act, unless (in the case of (a) or (b) above)'.

Mr. Deputy Speaker (Sir Eric Fletcher)

With this Amendment we can also consider Amendment No. 7, in page 5, line 27, Clause 4, after 'charge' insert: 'that charge shall thereupon be cancelled and shall cease to have any force or effect (notwithstanding that particulars thereof remain upon any register of charges) and shall not be renewable; and'.

Mr. Graham Page

Clause 2(2) sets out the occasions on which the spouse's rights of occupation come to an end and are described as the death of the other spouse, or the termination (otherwise than by death) of the marriage". Then there is a restriction or limitation of that: unless in the event of a matrimonial dispute or estrangement the court sees fit to direct otherwise … Elsewhere in the Bill the right comes to an end also on the wife's making an application for cancellation of the land charge and handing over that application to some third party in the transaction.

It seemed to me that the Bill is rather contradictory, that in a later part of the Bill the wife's right of occupation or her charge evidencing that right of occupation is cancelled by her handing over an application for cancellation, for the fact is not mentioned in Clause 2.

If I could explain by the circumstances which are most likely to arise, the husband owns the property, he wishes to sell it, the wife has a right to occupy — I imagine the marriage has broken up —and she has registered a charge to make certain that anyone dealing with the property knows she has got that right, but the husband is providing her with other accommodation and so they have agreed amongst themselves that she shall release her right. The husband enters into a contract to sell the property

By another Clause in this Bill there will be an implied term in that contract, that he shall see that the wife's charge is removed from the register. So on completion at the office of the solicitor to the vendor, that solicitor, having obtained an application for cancellation signed by the wife, hands over to the solicitor for the purchaser the conveyance of the property and the application to cancel the charge. The solicitor for the purchaser probably accompanied by the solicitor for the mortgagee who also wants to see that the property is clear of the wife's charge and to see that at that moment it is clear. All this, of course, does not happen at the Land Registry itself or the land charges registry. What is the period of time when the application for cancellation is handed over to the purchaser? Where the mortgagee may get a right to the property, that charge is still registered.

Taking Clause 2 on its own it did not appear to be clear at what moment the charge is cancelled. I think it possible that by a later Clause a cancellation takes place immediately upon the handing over of an application to cancel to the purchaser's solicitor or the mortgagee's solicitor, or the lessee, for example, if there is a lease.

My problem may be solved if I can ask the hon. Gentleman if he can give me an assurance, and then I shall be happy. The assurance I hope he can give me is that the wife—again, we are taking an example of the wife who is deserted, and the husband wishes to sell the property—having handed over the signed application, that having been handed over to the purchaser on the completion of the sale, she will not have any right to take that back or cancel it before the charge can be removed from the register. If there is any chance of her being able to do that it would cause great confusion in conveyancing.

Mr. Archer

I can treat the hon. Gentleman even more handsomely than he has invited me to do. Not only can I give him that assurance but, because Clause 6(2) was introduced in Committee at his own instigation, it is clear that once the application by the wife has been handed over, it is irrevocable and she is deemed to have released the right of occupation from that moment. I am quite happy to read it if the House wishes, but I think that it would be taking up time unnecessarily. The result is that the hon. Gentleman has provided the solution to his own problem.

Mr. Graham Page

I am much obliged to the hon. Gentleman. Accordingly, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

2.30 p.m.