HC Deb 08 May 1968 vol 764 cc507-22
Mr. Gardner

I beg to move Amendment No. 16, in page 13, line 17, leave out from 'mistake' to end of the line.

Mr. Deputy Speaker

I suggest that it would be convenient for the House to discuss with this Amendment the following Amendments: Nos. 17, 19, 21, 22, 23 and 24.

Mr. Gardner

That is indeed acceptable to me, Mr. Deputy Speaker, and I am glad that the hon. and learned Member for Darwen (Mr. Fletcher-Cooke) has returned to the Chamber after his brief absence, I hope refreshed, because at an earlier stage we had a considerable ornithology and I wanted to reassure him that, on whatever side we were some time ago, my hon. Friend the Member for Bradford, West (Mr. Haseldine) and I are on this occasion on the side of the hawks. A little while ago we were somewhat overwhelmed—indeed embarrassed—at the support of the official Opposition for one of our Amendments. I am therefore convinced that we are now on the side of the angels because, with the notable exception of the hon. Member for Beckenham (Mr. Goodhart) my hon. Friend and I now sit on the back benches in lonely isolation.

We come to one of the most important Clauses, because it provides the defences which a person can use to avoid a successful prosecution under the Bill. The defence with which we are most concerned is …that the commission of the offence was due to a…reliance on information supplied… This is a reasonably new concept and one which will provide an almost unlimited defence for almost anyone coming within the provisions of the Bill.

As we had a long discussion of this in Committee, I will not go over the ground again. We were obliged to withdraw a similar Amendment in Committee after some assurances from my right hon. Friend. The outcome is that the Government have tabled an Amendment which would have the effect of identifying the informant should the defendant in a case brought under the Bill claim that he relied on information received. This is to be welcomed, but I am afraid that it goes nowhere near enough to meeting the requirements which we sought. I therefore hope that the Minister will seriously reconsider the position which the Government have taken on this matter.

This concern is still shared by all responsible bodies with experience of consumer protection—the Consumer Council, the Retail Trading Standards Association and, I believe, the Consumers' Association. They advise that the Clause as at present drafted would allow far too many people to escape its provisions.

We understand that the Amendments which were made to the original Bill in another place were tabled to meet some important and, I believe, understandable representations made by the advertising profession. It is true that, without the phrase "reliance on information supplied", a creative advertising agency relying on, say, a specification relating to a product provided by a manufacturer, would have little defence. Advertising agencies, as we discussed earlier, are not scientific experts and we accept that the most reputable agency must rely on information provided by the manufacturer. I have no desire to not afford genuine advertising agencies this protection. If this is the problem, it can be met by the group of Amendments relating to Clause 24, which would have the effect of writing into the Bill the much broader defences written into the Medicines Bill.

8.0 p.m.

This would mean that the creative advertising agency, as distinct from the advertising manager putting advertisements in the local newspaper, would be able to rely, not merely on the advertisement but on the specifications received from the manufacturer. If these were wrong and the advertiser had no means of checking them, he should have that claim. This would be a far better way of meeting a genuine claim. If these words remain in the Clause they will not merely cover the problem of the advertiser, but will let through almost any unscrupulous trader who has good legal advice.

As I tried to suggest on Second Reading, this would allow a dishonest and unscrupulous trader to drive a coach and horses through the provisions of the Bill. This view is shared by the Consumer Council, and we should take note of what it says. It was set up by the Government to advise on consumer matters and the Council has adequate legal services available to it. Referring to whether a prosecution would follow, it says: Unless it is certain that either the defendant or his informant can be charged with the offence, we fear that the dishonest trader will be free to rig his sources so that proceedings will founder on the defendant's plea that he relied innocently on false information. The hon. Member for Beckenham amused us in Committee with his story of the weeping secretary. If a subsequent Government Amendment is accepted this evening, a defendant pleading reliance on information would have to identify the sources of his information, but suppose the source turned out to be a junior official or the weeping secretary. Does anyone seriously suggest that further proceedings would be taken against those informants?

Take the case where the informant is beyond the jurisdiction—our old friend the Belgian carpet manufacturer. We have had difficulties with such people in the past because of false descriptions about carpets being given to British traders. Suppose the trader claims that the description says that the carpet is made of one material yet it is made of another. We would lose the prosecution against the really guilty person and have no means of getting at the informant.

I am grateful for the advice of the one organisation which has real experience in prosecuting—the Retail Trading Standards Association. It suggested what might happen in a case should this Clause go unamended. Take the case of a trader who obtained a stock of very good blue shirts which looked rather like R.A.F. officers' shirts. He might think it a good advertising ploy to get rid of them by advertising them as "R.A.F. officer-type shirts". If a prosecution were brought saying that this was a false trade description, he could bring in evidence his advertising adviser and perhaps his secretary.

They could say that a telephone call had been made to the Ministry of Defence and someone at the other end of the line said, "That sounds O.K." Then the issue would go before the court and the Ministry of Defence, in its wisdom, may say that it had never heard of that telephone call, but before the court there would be three witnesses and lots of things can go wrong over the telephone. The court would never convict when faced with those witnesses and the rather doubtful evidence which the prosecution might be able to bring.

Mr. Michael Shaw

Is the hon. Gentleman not aware that this sort of case arises every day in magistrates' courts? A defendant says that he was on such and-such premises because someone invited him there, but it is up to the magistrates to decide whether the defendant is telling the truth. This sort of decision has to be taken by magistrates every day of the week.

Mr. Gardner

Earlier during this Report stage powerful arguments were put forward that this is a Bill with criminal sanctions in it and that lay magistrates are very wary about convicting on oral descriptions. Equally, lay magistrates would be wary of convicting in these cases and some people would get away with it. For these reasons the Clause offers too great a defence to the unscrupulous individual.

I make a plea to my hon. Friend to see that something should be done, even at this late hour, to meet our request. In effect, we are replacing the Merchandise Marks Act and bringing in a defence which was never available to a defendant under those Acts. I ask—in the nicest possible way, for my hon. Friend has been very charming to us—that she should consider her attitude towards this Clause and see if she can make the Amendments we suggest.

Mr. Dudley Smith

The hon. Member for Rushcliffe (Mr. Gardner) has put forward a fairly plausible case, but does he not think that in the kind of situation he illustrated the witnesses would be running a very severe risk of being prosecuted for perjury? My hon. Friend the Member for Scarborough and Whitby (Mr. Michael Shaw) explained that magistrates every day have to deal with this kind of case and to use their judgment.

We must have adequate defences for the innocent. The right hon. Member for Sheffield, Hillsborough (Mr. Darling) challenged me in a previous debate and referred me to Clause 23, saying that this was a very adequate defence as drafted for the innocent person who had nothing whatever to fear if he came before the courts. I feel strongly that if we carried this Amendment and deleted the phrase, or to reliance on information supplied to him many innocent people would be put in serious difficulty if a combination of circumstances conspired to bring them before the courts.

The hon. Member gave an illustration about R.A.F. shirts, but suppose an ordinary trader was selling blankets and was told by a reputable company that if a certain kind of blanket was washed in a certain way it would be perfectly all right and he passed on the information in good faith but it turned out to be wholly untrue. Suppose there was some mistake and subsequently the company withdrew the product from the market. Should the retailer then be prosecuted because be knowingly put forward a false description? In the obscure and unlikely case, we must have this phrase in the Bill in the interests of the retailer.

Mr. Gardner

Surely the man selling the blankets would have a further defence in the default of another person provided he used due diligence and rang up the suppliers.

Mr. Dudley Smith

The hon. Member speaks of "due diligence". We are dealing not with experts, but with human beings who may have very little connection with the law and perhaps this may be the first time they have come within the realms of prosecution. People have to be protected against themselves even if they are innocent. I should have thought that in this case he might have a defence. I agree that he might well have a defence under other provisions of the Clause, but he might not, because these are all open to interpretation by the magistrates or other courts of law. In consequence, if the magistrates thought that he was relying on information which had been supplied to him, and the Clause was amended as the hon. Gentleman seeks, I think that he would be much more liable to be convicted. If we are to persist with the idea of having these offences tackled by the court, we must provide the fullest possible and most adequate defence for the individuals who are charged. I hope that the Government will resist the pressure of the hon. Gentleman and his hon. Friends and keep the Clause as wide as possible.

Mr. Goodhart

I do not think that the hon. Lady can be very happy about resisting the Amendment, for the hon. Member for Rushcliffe (Mr. Gardner), who moved it so ably, is a powerful member of the Co-operative movement. As he pointed out, the Consumer Council feels strongly that the Clause should be amended, and I can vouch for the fact that the Consumer Association feels the same.

Perhaps more important even than those voices is that of the Retail Trading Standards Association, which has borne the heat of battle in bringing prosecutions under the Merchandise Marks Acts, which will now be largely superseded by the Bill. The Association has been successful in 49 out of 50 cases it has brought under those Acts. Therefore, when it expresses concern about the new position under the Bill there is good reason to take note of what it says.

The Association has gone so far as to take counsel's opinion from the barrister who successfully prosecuted in most of the cases that it brought. He expressed grave concern about the amount of warning time which a defendant is entitled to give to the prosecutor about the name of the person who furnished the false information, because it is clear that the amount of time specified will mean that the prosecution will be hamstrung in a large number of cases when reliance on false information is the main defence.

The learned counsel went on to say: In my view, there is a serious risk that the dishonest trader will be able to manufacture a defence for himself under the present wording of the Bill. He closed his opinion by saying: I, therefore, feel that the dishonest trader will welcome Clause 23 in its present form and that he may use it successfully to the prejudice of the consumer and of the established honest trader alike. Those are powerful words from a man who has carried out more successful prosecutions in enforcing the Merchandise Marks Acts than any single individual.

8.15 p.m.

Therefore, it is not surprising to find that the R.P.S.A. believes that if the Bill goes through with the Clause unamended the consumer and the honest trader will be worse off than they were before the Bill was introduced, and that the crooks will be able to drive a coach and horses through the gap that Clause 23, as at present drafted, leaves in the prosecution's case.

The point is that here we are not dealing with the small trader who may make a mistake in his oral description of some goods on his shelf but with the small minority of real crooks. They are the people who will have the skill, the facilities and legal advice to take every possible evasive action, and the Clause will be a godsend to the very small minority of traders who deliberately set out to cheat the public, and who bring so many of the efficient, honest retailers into disrepute.

Mr. Haseldine

I do not wish unduly to prolong the proceedings, but at this juncture it is important, in supporting my hon. Friend the Member for Rushcliffe (Mr. Gardner), to draw attention to the problem of services. The hon. Member for Beckenham (Mr. Goodhart) has also paid particular attention to this in Committee and today.

We must not overlook the deplorable circumstances of some holidays, particularly abroad, which I and other hon. Members raised in the Second Reading debate. Most travel agencies which organise holidays are careful to give good service, and do an excellent job. We do not want to cause distress or trouble to honest traders by any part of the Bill, but there are occasions when people really are taken for a ride on holidays—[Laughter.] That was quite unconscious humour. They are frequently taken for a ride in regard to accommodation described in glowing terms.

The travel organisations concerned could use the defence that this was because of information given by some other person, or was the fault of some other person. But people organising such holidays have a responsibility to the public to see that what they are advertising is good accommodation and in full accord with the brochures they produce.

There should be no objection to the amendment. We should without question stop people having the opportunity to defend themselves in the way provided by the wording we are now discussing and I hope that my hon. Friend the Parliamentary Secretary will give us some satisfaction on the amendment.

Mr. Crouch

I am not convinced by the legal and other arguments on Clause 23 which has been put forward by the hon. Member for Rushcliffe (Mr. Gardner). I am not convinced by the legal argument which has been submitted by the Retail Trading Standards Association, nor by the argument put forward by the Consumer Council. Those organisations see only the point of view, which I agree is an important one, of the protection of the consumer. The Clause was also designed to protect another group of persons, that is to say, the advertising industry.

The right hon. Member for Sheffield, Hillsborough (Mr. Darling), at a suggestion from me that he should consider the point, made the following statement in Standing Committee: The advertising agent is covered in Clause 23, provided that we retain the words which my hon. Friends wish to leave out—… Those are the words we are discussing this evening. that the advertising agent, if he committed an offence, committed the offence in relying on information supplied to him and that he took reasonable precautions and exercised due diligence to avoid the commission of that offence."—[OFFICIAL REPORT, Standing Committee A, 2nd April, 1968; c. 298.] We cannot write a better defence than that for the advertising agent. This was an answer which I was very happy to get.

The hon. Member for Rushcliffe is concerned, on the advice that he had seen, and my hon. Friend the Member for Beckenham (Mr. Goodhart) is equally concerned on the legal advice that has been presented to him through the Retail Trading Standards Association, that there may be an opportunity for the dishonest retailer, with clever legal defence, to drive a coach and horses through the Clause. This was not the view put forward to us in Committee by Government Ministers and their advisers. As I have already said, the right hon. Member, the former Minister of State, referred to the necessary protection that the advertising industry should have in this major Act which affects the industry and the promotion of products to the public. It is vital that we should give this important industry the protection that it needs. It will be in a very vulnerable position if we do not.

If we were to take out the words suggested by the hon. Member for Rushcliffe, the advertising industry would be left wide open to prosecution for mistakes made in the preparation of advertising claims on behalf of their clients. It is essential that, after proper, careful and thorough investigation, they should be able to rely on the information given to them by their clients.

The advertising industry is a responsible industry, but, as in every industry, there are irresponsible elements. I want to see the irresponsible elements brought to book. On a number of occasions in Com- mittee and on Second Reading I illustrated the care which is taken by the advertising industry. That care is illustrated by the massive task that they perform in a volatile sphere of communication, where mistakes can be damaging to society, and to the manner in which we live and conduct our lives. I maintain that they are responsible and careful in their approach to that task.

Within the last three years there has been set up the Advertising Standards Authority, which exercises a voluntary control on advertising. The House, as guardian of the liberty of the people of the country, can be proud of this. It is a body of which manufacturers and retailers can be proud and of which the public can be proud. It is a voluntary body which makes sure that advertising is proper, responsible and correct.

It is this industry, which has set up this voluntary body, that I seek to protect. The Minister has already said that the protection is in the Bill. I do not want the House, in a moment of high emotion, to be carried away by the good arguments on both sides of the House on behalf of the consumer.

I have mentioned the activities of the Advertising Standards Authority. It has a dual function in the supervision and control of advertising, and preventing the publication of bad advertising. The chairman of this body is reported in the Evening Standard of Monday, 6th May, 1968, as having said: Certainly, in the daily Press, we lead the world in the quality of advertising and this has a big effect on the quality of papers and vice versa. Good papers attract good advertising. I quote that to the House to underline the fact that the advertising industry is a responsible industry which takes care to show its responsibility to society as a whole and is not just concerned with its own ends.

Television advertising is an even more volatile form of communication than the printed word. There are even stricter controls there. Statutory controls have been laid down by Parliament to make sure that the Independent Television Authority keeps its house in order. It must have come as some surprise to the House to realise that it is not possible for an advertisement to be screened until it is first passed by an independent committee sot up by the Independent Television Companies' Association. This is an independent and responsible body.

I merely ask that the hon. Lady bears in mind the other side of the question.

Mr. Gardner

I assure the hon. Gentleman that I share his concern to protect the reputable agencies. I hope that he will agree that the Amendments would serve that purpose, particularly Amendment No. 22.

Mr. Crouch

I appreciate the hon. Gentleman's point. This issue is not entirely black or white. There is much give and take on both sides. I am merely drawing attention to the other side of the issue.

In Committee, I asked the Minister of State for an assurance about the I.T.A.'s position. He gave me an assurance that the I.T.A. would not be regarded as a body which would be responsible for the prosecution of misleading statements in television advertisements and therefore liable. I hope that the hon. Lady will confirm that that assurance still stands. The can test and alter advertisers' advertisements before they appear on the television screen. They do not often have to do so, but on occasion they have to step in and advise an advertising agent that a certain television commercial does not come up to its high standards and must be altered or modified. Having done so, it is a party to the statement subsequently screened to the public.

I should like an assurance that the I.T.A., having taken part, as it were, in the construction of an advertising statement and having advised on the content of an advertisement, will not be liable to prosecution under the Bill.

8.30 p.m.

Mrs. Gwyneth Dunwoody

These Amendments concern two of the most important Clauses in the Bill, and I can understand why we have had such a far-reaching discussion.

I wish, first, to deal with the Amendment of the hon. Member for Beckenham (Mr. Goodhart) since it is the most far-reaching Amendment. It seeks to delete both "reliance on information supplied" and the act or default of another person from the matters which may form the subject of a defence under Clause 23 on the ground that they open an unduly wide loophole in the Bill. I cannot agree that that is so.

I remind hon. Members that it is by no means sufficient for a person charged with an offence to show that he relied on information supplied to him or that the commission of an offence by him was due to the act or default of another. He must also show that he took all reasonable precautions and exercised all due diligence to avoid the commission of the offence. This is no light burden.

Let me give an example. Suppose that a tailor buys cloth from a manufacturer who tells him that it is all wool and then he makes up a suit from it and, relying on the information which he has been given, he tells his customer that the suit is all wool. In fact, it turns out to be a mixture of wool and rayon. If the texture or appearance of the cloth is such as to suggest to someone of the tailor's experience that it contains rayon, or if the tailor knows nothing about the manufacturer, or if he knows that the manufacturer has a reputation for giving false information about the composition of the cloth he supplies, then I do not think that the tailor could show that he had exercised all due diligence or taken all reasonable precautions to avoid the commission of the offence. If, on the other hand, there is no outward sign which suggests that the cloth is not all wool and the manufacturer is a reputable one whom the tailor has every reason to trust, then he has a defence under Clause 23, and rightly so.

I cannot deny that there may be cases in which a defendant is able to convince a court by a plausible but untrue story that he genuinely relied on information given him by another and that his offence was entirely due to the fault of someone else. In particular, he may succeed in doing this if others are prepared to conspire with him in supporting his story. However, I cannot think that this will happen often. We heard a great deal in Committee about the "weeping secretary", but I do not think that many defendants will have the benefit of such accommodating employees who are willing to perjure themselves for the benefit of their employers. Moreover, our courts are not easily taken in by dishonest stories of the kind referred to in this debate.

The fact that the dishonest rogue may, very occasionally, be able to hoodwink a court is no argument for denying a defence to the honest trader. This is exactly what the Amendment proposed by the hon. Member for Beckenham would do. If a person committed an offence because of reliance on information given him by another, or because of someone else's act or default, he would be liable even though he had genuinely taken every reasonable precaution and exercised all due diligence to avoid the commission of the offence.

I am sure that the House will agree that we do not want, by the Bill, to make people liable for a criminal offence in such circumstances.

May I turn now to the Amendments proposed by my hon. Friend the Member for Rushcliffe (Mr. Gardner). He seeks to delete reliance on information supplied to him from the matters which may form the subject of a defence under Clause 23 and to couple this with Amendments to Clause 24 which would widen the defences available under the Bill to advertising agents. As will be apparent from what I have said, it is not only the advertising agent who needs and deserves the defence that he relied on information supplied by another. It is a defence available to any person charged with an offence under the Bill and it was in fact designed with the retailer at least as much in mind as the advertising agent.

We have already taken a number of examples from the textile field, so let us now take one from somewhere else. Suppose a retailer is often asked by his customers whether the detergents which he stocks are suitable for use in washing machines. When a new brand comes on the market, therefore, he asks the manufacturer of the detergent and leading manufacturers of washing machines whether it can be used for this purpose, and is assured that it can. He knows that his wife has used it for her weekly wash and found it successful. He therefore tells his customers that the detergent is fit for the purpose of use in washing machines, but it proves to be not suitable when used in some types of machine.

I suggest that in such a case the retailer has taken every reasonable precaution and used all due diligence to avoid the commission of the offence and that he should not be held guilty of it. However, if the Amendment proposed by my hon. Friend were accepted the retailer would be guilty since he could not bring himself within any of the other defences provided by Clause 23. There was no mistake or accident on his part. It is true that there may have been an act or default on the part of the manufacturer, but the commission of the offence by the retailer was not directly due to that act or default but was due to his repeating the information given to him.

Similarly, the giving of the information by the manufacturer was a cause beyond the retailer's control, but, again, the commission of the offence was not directly due to that. If the retailer is to have a defence in the circumstances—and I am sure that the House will agree that he should—the words reliance on information supplied to him must remain in Clause 23.

I come now to the Amendments to Clause 24 which have been proposed by my hon. Friend the Member for Rushcliffe. Clause 24 as it now stands is a defence available to the publishers of advertisements and to persons who merely arrange for the publication of advertisements, and I think this was the point that particularly concerned the hon. Member for Canterbury (Mr. Crouch). In other words, it is available to newspaper proprietors, television companies and other medium owners and to agents who arrange for publication without playing any part in drawing up the advertisement. Such persons have a defence if they do not know and have no reason to suspect that the publication would amount to an offence.

The Amendments proposed by my hon. Friend seek to give such a defence to the advertising agent who draws up the advertisement, provided he has been given the material which comprises the advertisement by someone else. I cannot agree that an advertising agent should have a defence under the Bill merely because he does not know and has no reason to suspect that the issue of the advertisement would constitute an offence. The advertising agent has a very large part to play in the compilation of advertisements and is often given a very free hand indeed by those who employ him. What makes an advertisement false or misleading may not be the material which comprises it but the way in which that material is presented.

For that reason I think that, having regard to what we are trying to do in this Bill, he must be required to take reasonable precautions and to exercise all due diligence to avoid the commission of the offence.

I must apologise for speaking at rather great length, but the points at issue are really of the greatest importance to the Bill. I hope that what I have said will convince the House that the Amendments under discussion should not be accepted.

Amendment negatived.

Mrs. Gwyneth Dunwoody

I beg to move Amendment No. 18, in page 13, line 25, after 'person', insert 'or to reliance on information supplied by another person'. Clause 23(2) as drafted provides that if a person charged with an offence intends to rely on the defence that the commission of that offence by him was due to the act or default of another person he must, before the hearing, give the prosecution such information as he has as to the identity of that other person.

During the Committeee stage my hon. Friend the Member for Rushcliffe (Mr. Gardner) put forward an Amendment designed to place a similar requirement on a defendant who intended to rely on the defence that he committed the offence because he relied on information supplied to him by another person. My right hon. Friend the Member for Sheffield, Hillsborough (Mr. Darling) agreed with the principle of the Amendment and undertook to move an Amendment on Report to give effect to it. That is what the Amendment seeks to do.

The reason why Clause 23(2) requires the defendant to give the prosecution advance notice of the other person concerned is that it will enable the prosecution to make further inquiries. If, as a result, it finds that the defence will not stand up, it will be able to bring witnesses to court to rebut it. If, on the other hand, the evidence suggests that the defence will succeed, the prosecution will be able, in appropriate cases, to drop the proceedings against the original defendant and to institute proceedings against the real wrongdoer. Thus, if the prosecution is forewarned, a good deal of time will be saved all round.

I hope that the House will agree that, for that reason, it is desirable that the defendant should be required to give advance notice not only where the defence on which he proposes to rely is that the commission of his offence was due to the act or default of another, but also where his defence is that he relied on information supplied by another. I suggest that exactly the same considerations apply in both cases.

Amendment agreed to.

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