HC Deb 30 November 1983 vol 49 cc953-60 8.44 pm
The Solicitor-General (Sir Patrick Mayhew)

I beg to move, That the draft Judgments Enforcement (Attachment of Debts) (Northern Ireland) Order 1983, which was laid before this House on 11th November, be approved. The law in Northern Ireland relating to the attachment of debts is contained in the Judgments Enforcement (Northern Ireland) Order 1981. The attachment of debt is the process by which debts owing to a judgment debtor from somebody else may be ordered to be paid by that person to the judgment creditor towards the satisfaction of the judgment.

At present, the Northern Ireland law provides that a sum standing to the credit of a person in a deposit account in a bank shall be attachable, subject to certain qualifications. However, there are exemptions. The law does not apply to any account in the national savings bank, a trustee savings bank or any bank having two or more places of business in Northern Ireland if the terms applicable to the account permit withdrawals on demand on production of a deposit book at more than one of those places of business. That is in article 72 of the 1981 order.

In that regard, Northern Ireland law is out of step with the relevant law in England and Wales relating to the attachment of debts, which is contained in section 40 of the Supreme Court Act 1981. That section applies to any deposit account with a bank or other deposit-taking institution and any withdrawal share account with any deposit-taking institution. A deposit-taking institution is one which conforms to the definition in the Banking Act 1979, which includes the three types of institution which I have mentioned as being exempted from attachment orders under existing Northern Ireland law.

The order before us reflects the fact that many people now operate accounts with a building society or a trustee savings bank as though they were bank accounts. Therefore, it is desirable that the procedure for the attachment of debts should be available in respect of sums held by a judgment debtor in such accounts, in the same way as it is available for money in conventional banks. That is what the order is designed to achieve.

I ought to mention that deposit-taking institutions, as defined in the order, include credit unions within the terms of the Credit Unions Act 1979. Section 83(1) of the Industrial and Provident Societies Act (Northern Ireland) 1969 precludes credit unions from banking or receiving money on deposit from their members. I understand that it is the Lord Chancellor's intention to introduce an Order in Council in which that provision will be repealed.

It is also the Lord Chancellor's intention to provide by order that sums of less than £50 shall be exempt. The commencement provisions of the order before us take account of that.

The Lord Chancellor has consulted the Northern Ireland Bankers Association, the Building Societies Association, the legal profession, citizens advice bureaux and the Department of Finance and Personnel at Stormont. The general view was that the draft order contained a welcome enlargement of the powers of the enforcement of judgments office.

The Lord Chancellor intends to make an order authorising deposit-taking institutions to deduct the clerical and administrative costs of complying with an order made under the new legislation. Such an order has already been made for the corresponding legislation in England and Wales.

I do not think that hon. Members will require rue to take them through the provisions of the articles. It is perhaps sufficient to say that, by virtue of article 5, two minor errors in the schedule to the earlier order are put right and that article 1 provides that the main provisions of the order—contained in articles 3 and 4—shall come into force on a day to be appointed by the Lord Chancellor. I understand that that will not be before 1 March 1984.

8.49 pm
Mr. William Ross (Londonderry, East)

The problem with debtors lies not with those who attempt to pay their debts, but with those who try to avoid doing so. We are often approached by constituents who are owed money, sometimes considerable amounts of money, and who are finding it very difficult to get the money from a person who in fact has the money, but refuses to pay it. In so far as the order is an attempt to make folk who owe money pay up, it is welcome. It will, I think, make life a lot easier for many people in Northern Ireland, and perhaps harder—I hope it does—for people who are trying to avoid paying their just and lawful debts.

Most people try to pay, but when they see folk getting away with not paying it is like putting a rotten apple in a barrel—it tends to make the canker spread. I welcome anything that makes people accept their responsibilities, not only in their own households, but towards those with whom they have dealings.

I recall that this matter was raised in another context, and I have been racking my brains all day about where it was. I think that it was in the Northern Ireland context, and it possibly involved the payment of moneys to the Northern Ireland Housing Executive. I wonder whether the executive—and other people—will be able to get its debts paid as a result of the order, because I believe that some people have been trying to hide money away. If the order helps the executive to recover rent arrears and other moneys that it is owed, so much the better.

When I first looked at the order, I was surprised to discover that there were institutions where the money could not be attached. The Solicitor-General told us something of the background, but perhaps when he winds up the debate he could go a little wider and tell us how this situation has arisen. This loophole was not created during the past year or two. It must have existed for somewhat longer than that. If so, why was the loophole not closed long since? It seems unusual that something like this should go on from year to year, possibly even from Parliament to Parliament, without being corrected.

I have looked at the possibility of the Lord Chancellor extending the list of institutions. I assume that this is an attempt to forestall people creating loopholes in the future. If I understood the Solicitor-General correctly, he said that before the list could be extended—apparently it will be extended in the near future—a further order would have to be laid before the House. I was glad to hear that. I believe that such matters should always come back to the House before authority is given to extend the list of institutions, because the implications could be wider than intended.

In so far as the law in Northern Ireland is now being brought into line with the law that prevails elsewhere in the United Kingdom—which I welcome—I am anxious to know whether the law in the United Kingdom will be the same for England, Wales, Scotland and Northern Ireland. As, apparently, the legislation on this side of the Irish sea has been different from that in Northern Ireland during the past two or three years, is the Solicitor-General in a position to tell us this evening what the effect has been in the application and use of the law in Great Britain? People take advantage of the change in the law, but the general public, and often hon. Members, are not made aware of it until it has been in operation for many years. If there have been occasions in Great Britain when hardship has been caused, or when there have been unforeseen circumstances, the House should be told about them before the order is passed.

How on earth can the courts, or anybody else, find out whether a debtor has money on deposit? If a debtor has money on deposit, how can anyone discover where it is? A debtor could have money and not talk about it, so that even the courts do not know that the money exists. What happens if deposits are held in a wife's or child's name? Can any machinery make the court aware of such money? What happens if money is held in a company's name? Will the courts be aware of that? Many small companies are set up involving only two or three people, and it might be difficult for a court to discover whether money is available.

A recent inquiry into the De Lorean mess—that is the only word for it—revealed that considerable sums were moved out of the country. If that happens again, can the money be seized and used to pay debts? Those who want to avoid paying money will always find a way. I hope that in blocking one loophole we are not allowing other and more dangerous loopholes to remain open.

I am curious about why the opportunity was not taken in the order to ensure that whenever a court order for payment is made it is enforced until the entire debt is paid. We all know of cases where court orders are made, the individual involved changes address, pays once or twice then stops paying, and the unfortunate individual to whom the money is owed has to go through the whole miserable sequence of events again, to find that the same happens yet again. Why has that possibility not been dealt with in the order, because it causes anxiety?

Why is the order being used to correct errors referred to in article 5? It might have been neater and easier to make the adjustments in a separate order which could have been taken formally. It appears that we are tying two different matters together in the same order. That is, perhaps, a mistake.

8.59 pm
Mr. J. Enoch Powell (Down South)

This is an unsatisfactory way to legislate. That view will not come as a surprise to the House. Indeed, my hon. Friends and I look forward to the time when one part of the United Kingdom will no longer have its laws made in this form. We are encouraged in that hope by the fact that on a policy manifesto which included the abolition of direct rule, of which this order is one aspect, we won the election in June in the most striking manner.

This is a bad way to legislate. The proper method would have been to have introduced a Bill. The order is a good illustration of the deficiencies of this procedure. We are, in 1983, amending the Judgments Enforcement (Northern Ireland) Order 1981. The learned Solicitor-General must tell us whether the matters for which the order provides were overlooked in 1981. If so, why were they overlooked?

The Solicitor-General said that the order will bring the law in Northern Ireland into accord with that in England and Wales, and he quoted the Supreme Court Act 1981 as the corresponding legislation on this side of the water. But I rather gathered from his phraseology that the provision in the 1981 Act had previously existed, and was subsumed in that Act. Even if it appeared in the 1981 Act for the first time, why was legislation for Northern Ireland in the same year allowed to pass through the House—in all innocence by hon. Members on these Benches, who do their best to take a view on these matters—which put Northern Ireland out of line with the legislation in England and Wales?

The Solicitor-General pointed out that people are now using building societies and trustee savings banks rather like ordinary banks. But that has not happened since 1981—that was just as much the case when the order was made in 1981 as it is today. No doubt the habit of using trustee savings banks in that way has developed and become more widespread in those two years, but it is not a novelty; it is not something invented between 1981 and 1983. This matter could have been thought of, should have been thought of, and should have been provided for, when we last legislated on this subject in 1981.

I must voice a suspicion, which I hope is not unworthy, that if those who prepared the legislation were preparing it as it should have been put forward, in the form of a Bill, and with the knowledge that they could not dot the i's and cross the t's afterwards through an order that keeps the House late for one and a half hours at night, they would have been more careful. They would know that it was unlikely that the legislation committee of the Cabinet would look kindly upon the same Minister coming forward two years later and saying to his colleagues, "I am sorry to have to tell you, but there are some things that we forgot to put in the 1981 Bill. Can we please have another Bill?" The Minister would receive an unpleasant reaction.

However, because legislation is being passed by Order in Council, people say, "That is only Northern Ireland and if anything occurs after it has been passed we can always have another order." Perhaps the Solicitor-General can refute my observations, but on the face of it they are evidence of slipshod legislation two years ago. I regret that I have found other evidence to that effect. When I studied the order I was considerably offended as a parliamentarian to discover in article 3(4) that the Lord Chancellor can alter almost whatever we put into it, add to it or subtract from it by another order.

I suppose that, having had the unpleasant experience of discovering how much they forgot when drafting the 1981 order, the parliamentary draftsmen—the offshoot of that great race that still survive somewhere in the interstices of the Stormont rabbit warren—said, "We must not risk this again. Let us put something into the article so that we can do it with an order that does not have to come before the House of Commons, and so our faces will not be red."

We are invited tonight not merely to accept the order but to enable the Lord Chancellor, without further reference to us, to do anything with the order that he likes—to add anything to it or subtract anything from it. It is true that, of his generosity, the learned Solicitor-General gave us a specimen in his speech of what the Lord Chancellor might do, and very instructive it was. He said that the credit unions had still not been covered, but we were not to worry because the Lord Chancellor will cover the credit unions by order. Perhaps the Solicitor-General will explain why there was such a terrible rush to take this order that there was not enough time to draft the necessary additional provisions that will enable us to bring the credit unions, which are of relatively much greater importance in Northern Ireland than elsewhere, and are a much more important source of savings in the Province, into the order. We might just as well have taken our time, done the job properly, and put the credit unions in the order while we were about it.

We were then told that the Lord Chancellor will use his power to exclude minimal sums and that he was thinking about £50. Although I have considerable faith that the monetarist policies of the present Administration will greatly restrain the progress of that fell disease inflation, I would not make a purist objection to the adornment of this order with a provision whereby the figure of £50 might subsequently be modified by order. That would be a reasonable provision and concession.

If the learned Solicitor-General can stand at the Dispatch Box and say that the minimum should be £50 in the present circumstances, why is it not in the Order in Council, and why is it left to the Lord Chancellor to do it by order-making power? Is that all that the order-making powers would be used for? Is the unlimited power to exclude in article 4(b) to be used only to prescribe £50, or in due course, when inflation has risen to 10 per cent., to increase it to £55? This is bad legislation. This may be a quiet House but bad legislation is going through it.

Any hon. Member, inspecting the terms of the order while I am addressing the House, might allow his eye to fall on the provisions that allow for future orders made by the Lord Chancellor to be anulled by resolution by either House of Parliament, and might be saying to himself, "Is that not sufficient safeguard? Why should those pernickety Ulstermen complain of having orders made instead of provisions put into the Order in Council? They will still be able to argue and vote against the subordinate legislation under the Order in Council in time to come." I have to tell those hon. Members that I fear that they are mistaken.

Nothing would give me greater pleasure than for the Solicitor-General to say that when it says in article 4(4) that the order shall be subject to annulment in pursuance of a resolution of either House of Parliament it means just that. I hope that he will be able to do that, for it will be the dawning of a blessed day for my hon. Friends and myself, who have writhed hitherto under the injustice of the negative procedure, whereby subordinate legislation in respect of Northern Ireland has, since the Law Officers Act 1944, not been subject to any parliamentary process whatsoever on this side of the Irish sea or the other.

We are not merely leaving to be done by subordinate order that which could and should be done in the principal order itself, but we are leaving it to be done by subordinate orders, which unlike subordinate orders applying to the rest of the kingdom will not be subject to any parliamentary procedure.

This is a bad specimen of a bad method of legislation. Although my right hon. and hon. Friends and I consider that the provisions it makes are necessary and desirable, we are glad to see covered the institutions which are used as banks. We are also glad to see that the law in our Province will be uniform with that of the rest of the United Kingdom. We should not be doing our duty if we allowed this opportunity to pass without marking our dissatisfaction, which I hope is shared by the whole House. It is essentially an affront to the parliamentary process that this type of legislation, which is now in its ninth year, is used to make or alter the law in Northern Ireland.

9.10 pm
The Solicitor-General

I am grateful to those right hon. and hon. Members who have spoken. I shall deal as best I can with the points that the hon. Member for Londonderry, East (Mr. Ross) raised, but if there are any with which I do not deal I undertake to write to him about them.

The hon. Gentleman began by welcoming the measure, which makes it easier for a judgment creditor to get his money. I am grateful for what he said in that regard. It is important that we should take all practicable means to enable the orders of the court to take effect when they order that a debt shall be paid. I was grateful for his welcome for the fact that the order provides for an enlargement of the class of accounts in which money is held to the credit of a judgment debtor which shall be eligible for the attachment of debts procedure. I see no reason why a judgment debt in favour of the Executive should not benefit just as a judgment debt in favour of any other creditor would benefit.

The hon. Gentleman asked why there is a need for the extension. In England and \Vales, the equivalent provision before the 1981 legislation was substantially narrower in regard to the scale of accounts which were accessible under the attachment of debts procedure. That statute was the Administration of Justice Act 1956. The width of that scale was reduced by judgment of the courts. They limited still further the class of accounts to which the attachment of debts procedure applied. In 1981 we were faced in England and Wales with the need to broaden the scale of accounts. That is the case today. Therefore, the enlargement on this side of the water is a relatively recent event.

The Judgment Enforcement (Northern Ireland) Order 1981, which embodies the law in this regard, was a purely consolidating order. It was not an occasion when the legislature re-examined the issue asking, "How shall we bring matters up to date?" Had it been so, no doubt the opportunity to do the same thing on that side of the water would have been taken. Now, albeit two years later, we are putting matters virtually on all fours with England and Wales.

The hon. Member for Londonderry, East said that the law in Northern Ireland will be the same as that in England and Wales, and he asked about Scotland's position. I cannot answer the Scottish question, and I would be rash to venture into a discussion of Scotland's jurisdiction. I shall find out about that matter and let the hon. Gentleman know the answer.

Equally importantly, the hon. Member for Londonderry, East asked about the effect of the change of the law in England and Wales. I cannot give figures, but hon. Members can look at the extensive list of accounts and the institutions which, under the 1981 order, are eligible for the operation of the attachment of debts procedure in England and Wales. The 1981 order uses the definition of a deposit-taking institution contained in the Banking Act 1979. The attachment of debts procedure will apply to 14 separate institutions or organisations holding accounts. There must be a substantial widening of the power of the courts. I cannot say what the effect has been in money terms, but it has been substantial. I expect that the same results will be enjoyed in Northern Ireland.

The hon. Member for Londonderry, East asked how the courts discover whether a debtor has money on deposit. There is no sure-fire way of applying an X-ray, as it were, to the affairs of a judgment debtor, but the courts have certain powers under, for example, the Bankers' Books Evidence Act 1879. In certain circumstances, debtors can be examined about their means. When that has occurred, an obvious question concerns what bank accounts they have. There are provisions whereby bankers must open the accounts. Substantial means for disclosure exist.

The hon. Member for Londonderry, East asked why we had not taken the opportunity to strengthen the powers of the courts when a judgment debtor has moved from one address to another. An order applies once it is made. Whether it can be enforced depends on whether the debtor can be located and served with notice of further proceedings. I understand the difficulty. We intended merely an updating exercise to bring the Northern Ireland law of enforcement, in the respects that I have described, into line with the law of England and Wales.

The hon. Member for Londonderry, East asked why we should take this opportunity to correct two minor errors in the Bankruptcy Amendment (Northern Ireland) Order 1980 to which article 5 refers. One order is better than two. Since it was found to be in order to put the smaller matter right in this order, it was probably wise and economical to use this measure rather than come before the House with further legislation. On the whole, that is a tendency in Government to be encouraged rather than discouraged.

I recognise the longstanding objection of the right hon. Member for Down, South (Mr. Powell) and the Official Unionist party to the present legislative base for the Province. The right hon. Gentleman again took the opportunity to express his views on that. We know what the circumstances are. Tonight under existing legislative arrangements we seek to secure the approval of the House for a valuable and useful measure. I believe that I have dealt with his question about whether these matters were overlooked in 1981.

The right hon. Member for Down, South referred to the power in article 3(4) for the Lord Chancellor to amend as he likes. The answer that I am about to give is one that I may need to correct in correspondence if it proves to be wrong but I do not think that that will be the case. The power which is taken in the article is one which is to be found in the 1981 Act, which is the equivalent legislation for England and Wales. I believe that there is the same power by subordinate legislation to make an amendment. If that is so, it is another example of the parity which we are seeking to achieve. If it is not, it is not a point that I am entitled to take and I shall confess that to the right hon. Gentleman in correspondence if I have to do so.

I think it sensible to have a power whereby the Executive in the guise of the Lord Chancellor can say, "If we are dealing with credit unions, for example, it is important to take account of the fact that the members of such institutions may well have small accounts." That being so, it will be convenient to specify that there shall be a minimum sum below which the attachment of debts procedure shall not operate. It is in the interests of the credit unions that the reference to £50 should be included.

With respect to the right hon. Gentleman, I would not think it desirable to specify such a sum on the face of the order. It may prove to be too low or too high in the light of experience. I suggest that it is sensible to have a provision of the sort which the right hon. Gentleman criticises for fixing an alternative level if so advised.

The right hon. Member for Down, South asked whether subordinate legislation in this regard can be debated. He has vastly more experience than I of the procedures of the House and he will not expect me to seek to improve upon his own knowledge of these important matters.

Mr. J. Enoch Powell

The hon. and learned Gentleman may have misunderstood me. Under the 1974 interim legislation, it is not clear on the face of it whether the negative procedure applies during the interim period. It was not clear to me whether the provisions that we are discussing were caught by that interim arrangement and it was to that that I was addressing myself. As long as that is the case, there is a valid reason why the apparent identity of law between England and Wales and Northern Ireland is not so close an identity as might to the naked eye appear.

The Solicitor-General

If that is the case, I acknowledge the validity of the right hon. Gentleman's point. He said that it is not clear to him and I confess that at present it is not clear to me. I would be rash to essay a constitutional proposition on which I was not entirely clear. However, I shall improve my knowledge of these matters and write to him.

I hope that I have dealt with the helpful and valuable matters that have been raised during the debate. There is no dispute that the substantive provisions are valuable and timely, and therefore I hope that the House will see fit to approve the order.

9.24 pm
Mr. Michael Meacher (Oldham, West)

I say on behalf of the Opposition that, having listened carefully to the arguments, we do not have any objection to this measure and that we shall not be opposing it.

Question put and agreed to.

Resolved, That the draft Judgments Enforcement (Attachment of Debts) (Northern Ireland) Order 1983 which was laid before this House on 11th November, be approved.

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