SAVING FOR EXISTING CONTRACTS (Hansard, 2 November 1976)

§ Mr. Graham Page
I beg to move, That the clause be read a Second time.
The clause had to be drafted before the reprint of the Bill as amended in Standing Committee B was available. As a result, there is an error in the second line. It refers to Section 8, which is now Section 10. However, I think that that can be put right. I am in very good company, because on the last page of the Bill as reprinted exactly the same thing has happened. In the top left-hand corner there is a reference to Section 11(4), which should now be Section 13(4). I hope that the Minister will alter that.
The clause seeks to ensure that the new order-making powers given to the Secretary of State by the Bill will not be used in a manner which would invalidate existing civil contracts. It is narrower than New Clause 3, because it refers only to existing contracts. So far as my clause may be unprecedented, so far as it may be a new provision in the law, it is made necessary by the fundamental change in the law that results from the Bill, namely, that by the repeal of Section 10(10) of the 1963 Act an order by the Secretary of State will be permitted in future—to use the words of Section 10(10)— to cause the exclusion from use for trade of imperial in favour of metric units of measurement, weights and measures. 1241 Therefore, these are new powers to make such mandatory orders. They will be made under the sections to which I have referred in the clause— sections 1, 9A or 9B of the 1963 Act (as amended by this Act) or under section 8 of this Act". Section 1(2) of the 1963 Act is a paving section for Schedule 1 of that Act. Schedule 1 defines units of measurement by virtue of Section 1(2), which states: Schedule 1 to this Act shall have effect for defining for the purposes of measurements falling to be made in the United Kingdom the units of measurement set out in that Schedule". Schedule 1 had a greater effect than merely that of a definition schedule. Section 10(1) provided that no person should use for trade any unit which was not included in that schedule. The Bill repeals subsection (1) and will leave Schedule 1 merely as a definition schedule—the Minister reminded me of that several times in Committee—but in two respects Schedule 1 may have a greater effect than merely as a declaratory schedule defining certain units. For example, one may use the words "metre" or "litre" in a contract. In Schedule 1 of the 1963 Act both are defined as having the meaning from time to time assigned by order by the Board". Therefore, the meaning can change from time to time. If a change is made by order, it could without warning alter the effect of a contract. All that I am seeking in the clause is a warning period before a contract is so invalidated.
Secondly, Clause 1(2) inserts in Schedule 1 of the 1963 Act headed: Definitions of units which may not be used for trade". I presume that that means what it says, and that any of the units set out there may not be used for trade. If one uses such a unit in a trading contract, the contract must be invalid, void and unlawful. By Clause 1(1) the Secretary of State is given power by order to amend Schedule 1 of the 1963 Act by adding to, or removing from, Parts I to VA of that Schedule any unit of measurement". He might, for example, by order put the cubic yard into Part VA, with the result that it becomes a measurement which can no longer be used, and thereby 1242 invalidate at once a contract based on it, unless the House accepts my new clause.
A similar position could well arise as a result of orders made under the new Section 9A, introduced into the 1963 Act by Clause 2. The new section begins by saying: (1) No person shall— (a) use for trade any unit of measurement which is not included in Schedule 1A". It later refers in the same way to Schedule 3. Subsection (3) of the new Section 9A says: The Secretary of State may from time to time by order amend Schedule 1A or 3 to this Act". If the Secretary of State amends the schedules in such a way as to make an otherwise lawful unit unlawful, it seems to me to make invalid a civil contract based on those units. In that case the position is perhaps even worse, because under Section 9A(2) A person who contravenes— (a) this section"— and therefore an order which has altered the section— shall be guilty of an offence". Therefore, an early warning system such as I have suggested is only fair and just to the trader.
Regulations made under the new Section 9B, also introduced into the 1963 Act by Clause 2, may not be quite so disastrous to existing contracts, but Section 9B(3) is drawn so widely that one cannot forecast what such regulations may contain. They may certainly affect existing contracts.
Clause 10 creates an entirely new order-making power. The Secretary of State is there empowered to "exclude or modify" existing statute law. If he does so, that may affect contracts based on existing law, and those contracts should be protected, at least for a period.
The Minister's answer may be, as it was in part in Committee, that orders made under the new order-making powers will contain a saving article similar in effect to new Clause 1. He may give us that assurance, but it is not in the Bill. There is no obligation on the Secretary of State to protect existing civil contracts when the orders and regulations are made. If that is the Secretary of State's 1243 intention, I ask him to write it into the Bill by means of new Clause 1. It is necessary to make the provision obligatory and not leave it merely to the hope that there will be a saving article or regulation when the orders or regulations are made.

§ Mr. John Fraser
I hope that the right hon. Gentleman will not take it amiss if I say that his clause is in part inadequate, in part unnecessary, and in part inferior to what is already in the Bill.
Let me deal first with the argument that the clause is inadequate. If protection is needed to save a contract, it needs to be a permanent saving and not a temporary one for one year.
Secondly, the clause is in part unnecessary in relation to Clause 1 which is linked to Schedule 1, because Schedule I will be the record of definition. One of the reasons that we wish to have a schedule of record is so that we may have set out a catalogue of measures for the purpose of interpreting contract documents.
The use of a measure that is no longer valid if used by way of trade does not necessarily invalidate the contract. If the definition of a unit is changed, as the definiton of "litre" was recently changed, the statutory instrument always contains savings in respect of the existing contracts. I doubt whether there will be changes in Schedule 1. Indeed, I think that the schedule will remain as an archive for many years to come alongside other measures which are to be, if not put to rest, preserved for posterity.
Thirdly, the clause is inferior to what is already in the Bill because Clauses 2 and 10 already contain powers to make savings for existing contracts in respect of orders made under Sections 9A or 9B of the 1963 Act. That will be a permanent power—a power which the right hon. Gentleman by a later amendment seeks to leave out—but certainly the power exists to make savings for existing contracts. That kind of power has always been used in the past and always will be used in the future. I hope that in view of what I have said the right hon. Gentleman will withdraw the clause.

§ Mr. Graham Page
I am not at all satisfied with the Minister's reply, and I shall take his three points in turn.
First he said that this should be a permanent saving. I am sure that if I were to draft New Clause 1 including the word "permanently", the Minister would shout me down immediately. I was merely asking for a warning to those who have already entered into civil contracts, to make plain that those contracts would be terminated within a year. I thought that was a reasonable way in which to put it. Indeed, I am surprised that the Minister should throw out the clause, because I have been so moderate. I can be far more violent if he wishes, but I have advanced a model suggestion.
The Minister also said that the clause was unnecessary in regard to Schedule 1. I shall not repeat my argument on that matter. The Minister may read my remarks in Hansard tomorrow if he wishes to do so.
The Minister then said that an order does not necessarily invalidate a contract. That is correct; but orders making certain units unlawful in use may make civil contracts invalid, and indeed unlawful, if one continues to deliver goods under those contracts at the old weights or measures.
The hon. Gentleman said that orders always contain a saving clause. He was being contradictory, because he first said that the clause was unnecessary and he then said that orders would have a saving provision. I am not happy to accept a statement that in the past orders have always had this saving. Parliament will now by the Bill impose a mandatory change in weights and measures and units of measurement. In those circumstances we should make certain that orders contain saving clauses, and not merely trust to precedents.