HC Deb 20 May 1994 vol 243 cc1054-76

11 am

Mr. James Paice (Cambridgeshire, South-East)

I beg to move amendment No. 15, in page 1, line 8, leave out 'in the course of a business'.

Mr. Deputy Speaker (Mr. Geoffrey Lofthouse)

With this, it will be convenient to discuss the following amendments: No. 16, in page 1, line 10, at end insert

'whenever the seller sells goods in the course of a business and otherwise when in all the circumstances it is reasonable to imply the same.'. No. 10, in page 1, line 14, after first 'relevant' insert,

'any representations or other statements made by or on behalf of the seller expressly or by implication which it is reasonable for the buyer to rely upon'. No. 11, in page 1, line 15, at end insert

'including the commercial reputation of the seller, as the seller himself by himself or by any associated company or brand name may have induced in respect of the particular class of goods or otherwise by advertising, marketing or otherwise promoting the same.'. No. 7, in page 2, line 9, at end insert— '(2) In section 14 of that Act, for subsection (3) there is substituted— (3) Where the seller sells goods in the course of a business there is an implied condition that the goods supplied are reasonably fit for the purpose usually intended or to the knowledge of the seller or an agent of the seller (including any credit-broker) actually or reasonably foreseeable intended by the buyer for such goods, and in determining reasonableness regard shall be had to all the circumstances including the commercial reputation of the seller, as the seller himself by himself or by any associated or brand name may have induced in respect of the particular class of goods or otherwise by advertising, marketing or otherwise promoting the same.".".

Mr. Paice

I must declare an interest as an adviser to the Dixons group of companies, which are obviously involved in the sale and supply of goods.

The House will be aware that during the past few weeks—culminating in a vote in the House last week—I have single-mindedly pursued the issue of horse racing on Sundays. I am grateful to the House for its support on that issue, which I pursued with similar single-mindedness to that of the hon. Member for Kingswood (Mr. Berry) in relation to the Civil Rights (Disabled Persons) Bill. For that reason, I have only recently been able to turn my attention to other issues. As the interest that I have just declared makes abundantly clear, I am concerned about the sale and supply of goods.

Amendments Nos. 15 and 16 are linked and refer to the implication that a seller is operating a business for the supply or sale of goods even though he or she is not.

Many hon. Members will be familiar with the fact that car boot sales, Sunday markets and other opportunities for people to dispose of goods are burgeoning. Car boot sales have come a long way since their origins as somewhere where people could sell unwanted household commodities from the boots of their cars. Many different people now operate at them, sometimes as genuine businesses, but sometimes on the very fringes of respectability, selling a range of commodities, both new and second hand. I dare say that some of the commodities are purported to be new but are not.

Another development is shop squatting, which has caused great distress to the retail industry. As premises become vacant, for whatever reason—sadly, during the past two or three years it is often because the previous tenant had to close the business down—people move into them, often at Christmas time, to sell a range of commodities. In such cases, the goods are almost entirely new, but they are of fairly dubious quality.

The common feature of car boot sales, Sunday markets and shop squatting arrangements is that the sellers appear to be operating as businesses. The Bill clearly sets out to protect consumers and I do not want to detract from that aim. I am trying to enhance consumer protection in that respect. We must therefore ensure that members of the public are not excluded from the protection offered by the Bill because someone is masquerading as a business, but is not one in reality.

It is impossible for a consumer to know for certain whether someone is legitimately operating a business or whether they have managed to procure a pile of out-of-date groceries, tinned foods, Christmas decorations or any one of the countless variety of products that are on sale on such occasions. A potential purchaser does not know the business background. Perhaps someone has been left the goods, found them in their attic or obtained them by dubious means, which is a matter for the Sale of Goods (Amendment) Bill, which is next on the Order Paper. Or they may simply have gone out and purchased them.

Mr. Oliver Heald (Hertfordshire, North)

Does my hon. Friend agree that the law should state that only the purely private seller is excluded? His amendments would give the courts discretion to achieve that, which has been impossible under existing legislation.

Mr. Paice

I always bow to the judgment of colleagues who are experts in the legal profession, as I am not. I am therefore even more grateful that my hon. Friend appears to endorse my argument.

In my constituency, many people who go to, or purchase goods from, the various sales that I mentioned are greatly concerned and I am sure that other hon. Members also find that that is the case. Car boot sales are especially common and purchasers have no idea of the origin of the products on sale. It is impossible to know whether the goods are being sold genuinely and whether they are genuinely new. Goods often seem to be in the original packaging, but sometimes there are grounds for doubting that they are new.

The Bill as drafted, and after the Standing Committee, does not protect the consumer if sellers of goods can demonstrate that they are not selling them as a business.

Mr. Nigel Waterson (Eastbourne)

I appreciate that my hon. Friend's proposal will not apply to charities, but existing law applies to second-hand goods. What effect would his amendments have on the following situation, which is not unheard of in my constituency? Someone—perhaps a farmer—takes a sort of rental for the number of people coming to a big car boot sale. People might not come regularly to set up a stall as they might have full-time jobs during the week. Perhaps they come along from time to time to sell stuff that is theirs or that they have acquired in the way that he described, which might include second-hand goods.

Mr. Paice

The second-hand goods aspect is extremely important and I am pleased that the Bill as drafted proposes that protection be extended to cover second-hand goods. I want that protection also to be extended to similar goods sold in situations where purchasers believe that they are buying from a business when they are not.

Once one moves to the second-hand goods arena, one must clearly begin to question the origins of the goods. There is no way that purchasers can know who has title to the goods. One has to assume that it is the seller. One must also assume that the seller is telling the truth if he says that he bought the product new only a year ago and that it has hardly been used, or that it was his grandmother's and has never been turned on because she died shortly after buying it. A range of salesman's glib talk can be used to persuade the gullible to purchase goods that they believe to be in good condition, but when they get them home they find that they are not.

If it can be proved that the person from whom the item was bought was not operating as a business, the buyer has no right of redress, which the Bill seeks to provide. I am anxious, therefore, that the provisions regarding a business should extend not only to new products but to second-hand goods, as I understand that they would if the amendments that I have drafted were made.

That would not be a precedent. Already, every classified advertisement must declare at the end if it is a trade sale. That is most commonly seen in vehicle advertisements. I am sure that all of us are old enough to remember reading classified advertisements for second-hand cars in the days when an ancient car was all that we could afford, and telephoning about a car only to find that one was telephoning a garage when one had thought that it was a private number because it was in the classified advertisements. If a garage advertises in those columns now, it must make it clear that it operates as a trade business. The extension of that principle to the sale and supply of goods would give much greater protection to the consumer.

I conclude by making a positive statement to the House. The subject has arisen many times, and I hope to pre-empt accusations that may be made later. In tabling my amendments, I have not had any advice, assistance, participation or, to the best of my knowledge, any knowledge from Ministers, civil servants or parliamentary counsel. They were drafted by myself in conjunction with other Back-Bench colleagues who are lawyers and better able to put them into legal language.

Mr. David Clelland (Tyne Bridge)

I accept entirely what the hon. Gentleman has said about the drafting of his amendments. I think that the proof of what he has said is the fact that most of his amendments were ruled out of order by the Speaker. However, as the hon. Gentleman has been a Member of the House for a considerable time and was here in 1989, the last time that the measure was debated, will he explain why, with his great interest in the subject, he did not table those amendments then?

Mr. Paice

Life moves on in this place and Members' interests tend to vary. The hon. Gentleman will find that during the period to which he refers I was actively involved in other aspects of the legislation of the House. I am a firm believer in the fact that one cannot concentrate on too many things at once, and that people who try to do so end up in difficulties. I am grateful for the hon. Gentleman's acceptance of the statement about the authenticity of the amendments, although his comment about the proof of it was perhaps unnecessary.

I have proposed my amendments Nos. 15 and 16 specifically because I wish to protect the consumer, who may be misled into believing that he or she is buying from a genuine business, only to find, when seeking redress, that it was not a genuine business. That is the sole purpose of the amendments. I commend them to the House.

Mr. Roger Evans (Monmouth)

The Bill is a welcome measure of consumer protection as far as it goes, and the amendments in the group all deal with specific matters designed to improve consumer protection. I welcome what my hon. Friend the Member for Cambridgeshire, South-East (Mr. Paice) has said and I shall develop his argument a little further as it introduces the other amendments, Nos. 10 and 11, which stand in my name.

Part of the problem is that branded goods acquire a commercial reputation. If one buys from a private citizen a nearly new second-hand something-or-other—perhaps a rather expensive motor car—which turns out to be what the Americans call a lemon, what happens? Under the existing law, and under the Bill as drafted unless it is amended in the way that we are discussing, a sensible private seller would say nothing more than that it is a nearly-new something-or-other. The fact that it may have been very unsatisfactory in the six months for which one owned it is neither here nor there. The law imposes no obligation on the seller to say anything about the item. If the seller does say something about it, the law imposes a liability on the seller only if the seller makes a misrepresentation of existing fact—a narrowly defined category—or if the seller makes a contractual promise, which most sellers are not foolish enough to do.

11.15 am

Amendments Nos. 15 and 16 catch that situation, where someone buys a nearly-new something-or-other which is sold by a private citizen but the private citizen receives a higher price as a result of the commercial reputation of that class of goods. I suggest that that is the classic situation in which it would be reasonable for the court to treat the item as being sold in the course of a business.

That leads to amendments Nos. 10 and 11, which tackle the problems caused by the fact that the vast expenditure on advertising, marketing and promotion induces in members of the public—very reasonably, since that is why the money is spent—expectations of quality, which are not always met. The public, as consumers, should have wider protection in those circumstances. As the Bill is currently drafted—I welcome it although I am nostalgic for that useful ancient term, "merchantable", although I can understand that it is no longer up to date—clause 1(2A) provides: For the purposes of this Act, goods are of satisfactory quality if they meet the standard that a reasonable person would regard as satisfactory, taking account of any description of the goods". I pause there because that deals with amendment No. 10—description—which is a very narrow legal category.

What I suggest should be considered specifically as part of all the circumstances are representations—that is perhaps not so controversial or novel—and all other statements made on behalf of the seller, expressly or by implication, on which it is reasonable for the buyer to rely. If the seller puffs up the goods, it seems to me that it ought to be specifically drawn to the court's attention as something to which it is reasonable to have regard. That is fair and just because it is the seller's expenditure on advertising, promotion and marketing that has raised expectations in the public of satisfactory quality, and that should be specifically brought into account.

Mr. Heald

In one of my amendments, which was not selected, I tried to tackle the problem, which my hon. Friend approaches in a different way, of a seller making a statement, for example, to the effect that the vehicle has a defective vacuum pump, but not explaining the full relevance of that—the full relevance being that the braking system would fail if the vehicle went on the road. In such circumstances, would the quality and nature of that statement be fully taken into account in deciding whether the quality was satisfactory?

Mr. Evans

I am grateful for that intervention because my hon. Friend makes an extremely important argument. I imagine that most of us, as consumers, would regard that situation as crying out for a just remedy.

The intention of the wording introduced in amendment No. 10, "other statements", is that if those statements are incomplete in the way described in my hon. Friend's example, or if a part-truth is told, which may be true as far as it goes but nevertheless does not go any further—

Mr. Alfred Morris (Manchester, Wythenshawe)

I am grateful to the hon. Gentleman for giving way. Can he gave the House a broad estimate of how long he intends to speak on this group of amendments?

Mr. Evans

I should not have thought that that was relevant to what I am saying. I shall not speak at great length. From the clock, I believe that I have been speaking for about three minutes.

Mr. Morris

How long are you going to speak?

Mr. Evans

I shall not continue very much longer, if the right hon. Gentleman will just listen. These are important technical matters. I have spent more than 20 years at the Bar arguing about cases arising from the existing legislation and I have been struck by the degree of injustice whereby consumers do not obtain what they reasonably expect and anticipate. The amendments are intended to catch the wily Arthur Daley type of salesman, who ought to be sued successfully. It should not be enough to say, "I have said just enough and it is accurate as far as it goes," in the way my hon. Friend the Member for Hertfordshire, North (Mr. Heald) described. That is what I want to catch.

I will move on quickly to amendment No. 11, which refers to a good point that I should have thought that Opposition Members would find attractive. I want to add a specific provision as to "all the circumstances", the commercial reputation of the seller, as the seller himself by himself or by any associated company or brand name may have induced in respect of the particular class of goods or otherwise by advertising, marketing or otherwise promoting the same.'". It would seem to me unjust for large commercial organisations to arouse expectations of quality which, in a particular case, they manage to get out of because under the existing law nothing has been said that is specific. Clause 1, which is highly satisfactory and desirable, could be strengthened in that way to deal with that problem. I commend the amendment to the House.

I do not intend to go on for much longer, which should console the right hon. Member for Manchester, Wythenshawe (Mr. Morris), who seems to be still here. My final point is that I am deeply troubled by what the Bill does to section 14 of the Sale of Goods Act 1979. In the 20 years since I passed my Bar exams, the law has been altered twice, and in drafting terms it is a dog's dinner. I have a specific question which I hope that my hon. Friend the Minister will answer specifically. Why is section 14(6) left in when it should not be? I appreciate that those who drafted amendment No. 7 may not have thought of the importance of section 14(3), but if we are to have a new and effective definition of satisfactory quality, the definition of reasonable fitness for the purpose intended contained in that subsection should be brought up to date as well.

The House must bear in mind the fact that when I sat the Bar finals it was the other way round: reasonable fitness came first as the primary remedy, then merchantable quality. Parliament subsequently inverted that and we are now playing around to improve merchantable quality and, rightly and properly, substituting "satisfactory quality". It is necessary to broaden the test of reasonable fitness, which was traditionally far too narrow and again favours businesses and does not protect the consumer. The way in which it works at present is that where the buyer makes known a particular purpose to the seller, the goods have to be reasonably fit for that purpose. That is all very well as far as it goes, but it is extremely limiting.

If I were to say to you, Mr. Deputy Speaker—and if you were in trade, which you are not—that I wanted a something-or-other to do something-or-other, it would be fair game, if you were going to sell it to me, that it should be reasonably fit for that purpose. Most of us go into large retail warehouses to buy goods and we should have the same kind of protection. There is bound to be, and there always has been, an overlap between merchantable quality and reasonable fitness. Because the term "satisfactory quality" is so much better drafted, there will be even wider overlap.

Amendment No. 7 would ensure that the goods should be reasonably fit for usual purposes, and that should be spelt out. It would also ensure that the actual purposes of the buyer, which the seller knows, are made clear. It goes further, however, and refers to the purposes of the buyer which are "reasonably foreseeable" by the seller. In other words, if the commercial reputation of the seller and the goods in question is such, all the matters which have been aroused in the way of expectations on the part of members of the public should have a remedy. That is the purpose of the amendment.

It is my submission to the House that this combination of amendments strengthens this welcome Bill. When my hon. Friend the Minister speaks in due time, I hope that he will consider each of those aspects and see how far he can follow the spirit of the arguments that have been put. I commend what I have said to the House.

Mr. Heald

I pay tribute to my hon. Friend the Member for Cambridgeshire, South-East (Mr. Paice), who has tabled amendments Nos. 15 and 16, which address problems that I have encountered in the courts as a barrister in the past 20 years. Those problems arise from the definition in section 14 of the Sale of Goods Act 1979 that the implied term as to "merchantability", or now "satisfactory condition" arises where the seller sells goods in the course of a business". Those words cause two problems. First, the words "in the course of" have considerable uncertainty to them at law and do not provide adequate consumer protection. We should remember that the Bill, dealing as it does with the supply and sale of goods, affects all our constituents. It is not to be lightly trifled with and if there are mistakes and errors in the law, which there are, they should be remedied.

The second problem is that the word "business" is not a legal term of art, but it is an etymological chameleon, which means different things, depending on its context. There is a need for additional flexibility to protect the consumer.

To appreciate the nature of those problems it is necessary to consider the background. The words were first inserted in the Supply of Goods (Implied Terms) Act 1973 and are similar to words used in the Trades Description Act 1968 that the false description must be applied in the course of a trade or business". The Unfair Contract Terms Act 1977 uses similar words, makes the contract in the course of a business The policy of the words has never been clear at law. If I make a brief reference to "Benjamin On Sale of Goods", which is the leading text on this, the problem can be appreciated. About those words, it states: It seems plain that they cover not only a seller making a regular sale of goods in which he deals, but also a seller who by way of business manufactures or obtains or sells a commodity for the first time: this is supported by authority on the former wording … It seems also to be generally agreed, though such authority as there is derives from decisions in other contexts, that there is no need for the seller to be in the business of selling items such as that sold, or indeed to be in the business of selling at all; a one-off adventure will suffice. On that basis, it was generally thought up to 1984 that the purpose of the wording was to include all sales except those by purely private sellers. In an earlier intervention I made that point to my hon. Friend the Member for Cambridgeshire, South-East. Most of us thought that that was the law and it is my submission today that it should be and that the amendments would achieve that.

I successfully argued in cases that the principle should be that only private sellers were excluded. In the earlier edition of "Benjamin on Sale of Goods", the following passage appeared, which seemed to support that: A farmer who sells off a surplus tractor, or a medical practitioner or solicitor or local government department disposing of surplus equipment which sells a used typewriter acts in the course of a business and so attracts the operation of the statutory term. You may feel, Mr. Deputy Speaker, that if you were purchasing an item of property—a computer or a typewriter from a local authority—you would expect it to meet a certain standard and you would be somewhat surprised and feel that you should have a remedy at law if it was in a poor condition, unsatisfactory or, to use the old word, "unmerchantable".

The law was thrown into confusion in 1984 by the House of Lords decision in Davis v. Sumner, which is reported in the weekly Law Reports. That was a case under the Trades Description Act upon the wording, in the course of a trade or business". The House of Lords decided in that case that a "sporadic" sale of an item was not covered and that there must be some degree of regularity to the provision of those goods in a business.

In that case a self-employed courier sold a car that he had used for his business during the preceding two years. The sale was held not to be in the course of a trade or business". He had done 118,000 miles on his car, but the odometer showed 18,000 miles. He sold it and signed to say that 18,000 was genuine. The House may find it rather extraordinary to discover that it was held that he was not liable when the goods were not of merchantable quality—in this particular instance they did not meet their trades description.

There is a distinction to be drawn between the Trades Description Act and the Act with which we are concerned, the Sale of Goods Act. Under the Trades Description Act one is talking about the criminal standard and one is trying to restrain criminal activity. It is therefore right that the definition in that Act should be restrictive. I shall develop the argument that the same considerations can be applied under the Sale of Goods Act 1979. The House of Lords decision in Davies v. Sumner was followed in a 1988 case, R and B Customs Brokers Co. Ltd. v. United Dominions Trust. As it was not reported until early 1989, that explains why my hon. Friend did not bring it to the attention of the House on a previous occasion. That case was brought under the Unfair Contract Terms Act 1977, where it was held that the buying of goods must form at least an integral part of the buyer's business or be a necessary incidental thereto.

Because that decision failed to make the distinction between the two purposes of the two Acts, the effect is to reduce protection for buyers.

11.30 am

It is right that there should be a restrictive definition in a criminal statute, but a more liberal one is required where the consumer and his protection is at stake in a civil context, as here. It appears that a sporadic sale by someone who is not in the business of selling would not be covered by the protection. That is wrong, and amendment is needed. The words "in the course of" are inadequate for the purpose of consumer protection. The amendment is needed for that reason. The same is true in respect of the meaning of "business". Trading corporations or partnerships are businesses, but there are numerous borderline cases—non-trading corporations, partnerships, private individuals, and non-profit making organisations such as universities, colleges, schools and nursing homes.

Is a hospital restaurant, university book shop or even school tuck shop a business within the meaning of the statute? That may seem an arcane point, but it arises regularly in the provision by charities of low-cost furniture and the sale of secondhand clothes at jumble sales. One assumes that the charity itself would not be covered, but a problem arises where a charity or any of those other institutions moves into the commercial field.

In the leading text, that problem is outlined as follows: There are also organisations of a non-profit making nature such as universities, colleges, schools, nursing homes and so forth which make sales: although the whole activity may perhaps not be appropriately designated as a business, certain portions of it (e.g. a university bookshop or hospital restaurant) may be. Such cases must be solved with the aim of the legislation in mind; this seems to be the protection of consumers against those who sell with some degree of professionalism and regularity. The answer will turn on the circumstances of each case, and it is doubtful whether any specific principles can be laid down. At present such authority as there is … arises in other contexts". The amendment would delete the words in the course of a business and add to the concept of a sale in the course of a business the flexibility that the implied term may be implied when, in all the circumstances, it is reasonable to do so.

In a proper case, that would enable the court to allow in the implied term, to deal with two particular problems. They are the case of a sporadic sale by a business man whose business was not that of selling—the problem that I outlined in respect of a farmer selling a tractor—and situations such as car boot sales, which are the subject of considerable public concern.

At present, the Government are amending the law on markets in three ways. One is a provision in the Deregulation and Contracting Out Bill. There is currently a prohibition on setting up a market within six and a half miles of an existing market.

Mr. Roger Evans

Six and two third miles.

Mr. Heald

Within six and two third miles of an existing market. That prohibition is going. The provision as to market overt may go if the Sale of Goods (Amendment) Bill [Lords] is dealt with today. Car boot sales and their implications as markets are also being considered.

The law as it stands is not capable of dealing with the problems that arise for the consumer in knowing whether the place where he is purchasing goods is reputable. At car boot sales there will be individuals who are not selling in the course of a business as existing law would have it, but who none the less frequently attend car boot sales with items for sale. The flexibility provided by the amendment would address that situation.

My only concern is that the flexibility is too widely drawn. When my hon. Friend the Minister considers amendments Nos. 15 and 16, I should be grateful if he would address their specific wording and say whether their breadth and flexibility is too wide and might catch private individuals who sell goods, perhaps through a newspaper—whom we all agree should be excluded from the ambit of the legislation. I look forward to hearing my hon. Friend's response.

Mr. Clelland

It may help to progress matters if I answer the points that have been raised. I am sure that they cover the amendments, so other hon. Members may not need to repeat them and prolong debate.

Amendment No. 15 would amend section 14(2) of the 1979 Act. At present, it provides that it is an implied term of a contract of sale that goods are of satisfactory quality. That introduces one of the basic requirements of the 1979 Act, but it is limited to cases where the seller sells goods in the course of a business. It does not extend to sales where the seller is not acting in the course of a business. Amendment No. 15 would remove that limitation, so that all sellers of goods would be required to supply goods of satisfactory quality.

That would place a significant burden on individuals wishing to sell goods. If a dealer sells a secondhand car, it is reasonable to expect him to have the skills and equipment to check that the vehicle is of satisfactory quality. A private seller is not in that position. His description of a vehicle may become an implied term of the contract, but that is all that should be expected. I cannot, therefore, support that amendment.

Mr. Waterson

Will the hon. Gentleman give way on that point?

Mr. Clelland

If the hon. Gentleman will forgive me, I want to make progress.

Mr. Matthew Banks (Southport)

Will the hon. Gentleman give way?

Mr. Clelland


Mr. Banks

The hon. Gentleman is making a great mistake.

Mr. Clelland

Amendment No. 16 would also amend section 4(2) of the 1979 Act. The requirement that goods should be of satisfactory quality would apply in contracts of sale—

The Parliamentary Under-Secretary of State for Technology (Mr. Patrick McLoughlin)

Will the hon. Gentleman allow me to intervene?

Mr. Clelland

I will give way to the Minister.

Mr. McLoughlin

I am most grateful. The Government and I whole-heartedly support the Bill, but in the light of recent suggestions, will the hon. Gentleman confirm—as I believe that he did in Committee—that he received from the Department of Trade and Industry help with his Bill and with meeting points raised in amendments tabled by my hon. Friends?

Mr. Clelland

I do not understand the point that the Minister is trying to make. Both sides of the House want the Bill to pass, which is why some of us cannot understand the prevarication of Conservative Members and their attempts to delay progress. We know of course that their behaviour relates not to this Bill but to one that is to be considered later today—if we ever reach it. It is my intention to get the Bill through quickly because everyone wants it.

The effect of amendment No. 16 would be that the requirement that goods should be of satisfactory quality would apply to contracts of sale not only where the seller sells goods in the course of a business, but where, in all the circumstances, it is reasonable to imply—I assume that the hon. Gentleman means infer—that he sells in the course of a business.

I cannot agree to that amendment. Its second part is unclear and imprecise, and would introduce great uncertainty into transactions. What circumstances would be relevant in deciding whether it may be inferred that someone is selling by way of a business? Is it reasonable for a buyer who responds to an advertisement and visits the seller's house to purchase goods to assume that the seller is in the course of a business because he has 20 items for sale? The risk of being assumed to be acting by way of a business would deter many individuals from selling goods.

Mr. Heald

What does the hon. Gentleman say to the point that I was making: that if the law stays as it is, as proposed in his amendment, the effect would be that if someone, perhaps a farmer, sells a tractor after two years, where his business is not naturally the sale of tractors, he would not be covered by the legislation? Surely he should be. The person buying from the farmer should be able to rely on the satisfactory condition of the item.

Mr. Clelland

The farmer might very well sell his car rather than his tractor; it is still a motor vehicle. He is not an expert in car sales. He is merely selling a second-hand car, as many individuals do.

Mr. Heald


Mr. Clelland

I shall not give way again. I have answered that point. Any individual can sell an item without being an expert in the nature of the item and cannot be held to be running a business as a result.

I do not see the need for amendment No. 10, as the additional factor is already covered by the present wording of section 14(2)(a). Any representations or other statements made are likely to amount to a description of the goods, which is already a factor referred to in that section. If they are not a description, they are, I suggest, "other relevant circumstances" and are therefore covered by the third factor in that section.

The Bill is drafted in general terms to cover a wide variety of situations and types of goods. Its terms are therefore often of a general nature. We should avoid introducing amendments that move away from that. In addition, introducing further factors into section 14(2)(a) could result in a court feeling constrained to consider only those factors, to the exclusion of all others. Furthermore, the introduction of that factor would be somewhat at odds with the provision of proposed section 14(2)(c). I can imagine that retailers may become most reluctant to offer any statement in respect of goods. That could deprive buyers of the advice that they require.

Amendment No. 10 refers to representations or statements on which it is reasonable for the buyer to rely. That would create a degree of uncertainty in commercial transactions. What criteria will be used in deciding whether it is reasonable for a buyer to rely on the representations made to him? Ultimately, the matter will have to be decided by a court, but it is likely that, in many cases, where the purchaser is an individual, he will not pursue the matter if the seller asserts that it was not reasonable for him to rely on any representations, as to do so could involve considerable legal costs.

Amendment No. 11, like amendment No. 10, would add additional wording to the proposed section 14(2)(a) suggesting that an additional factor be introduced, which, in essence, would be the commercial reputation of the seller. Again, I cannot support the amendment. Section 14(2)(a) already refers to the consideration of all the other relevant circumstances. To the extent that the commercial reputation of the seller is relevant, it is already covered by that provision. I cannot, however, accept that the seller's commercial reputation is a relevant factor. Section 14(2)(a) explains what makes goods of a satisfactory quality, and the reputation of the seller cannot have any impact on that. It is totally inappropriate when assessing the quality of goods to assess the commercial standing of the supplier.

I am most concerned that the effect of amendment No. 11 would be to suggest that buyers should have different rights depending on from whom they purchased goods. That should not be the case. The requirements of the legislation should apply with equal force to all sellers who act in the course of a business.

Mr. Roger Evans

I am surprised that the hon. Gentleman is not concerned about the effect of advertising and the vast amount of money that is spent on building up brand names and reputations. When somebody buys a nearly new something-or-other, why should not the fact that it is a something-or-other, with all that goes with it, which has been puffed up in expensive advertising, be specifically drawn to the court's attention as something that could be taken into account? I should have thought that that was elementary social justice and a considerable protection.

11.45 am
Mr. Clelland

I do not imagine that there is anything to prevent that from being brought to the court's attention. We are saying that we do not think it needs to be written into legislation.

I now deal with amendment No. 7. Section 14(3) of the 1979 Act deals with a situation where a purchaser of goods expressly, or by implication, makes known to the seller or, in certain circumstances, a credit broker any particular purpose for which the goods are being bought. In such circumstances, there is an implied condition that the goods supplied are reasonably fit for that purpose. That is the case whether or not the buyer's purpose is a purpose for which the goods are commonly supplied, except where those circumstances show that the buyer does not rely, or that it is unreasonable for him to rely, on the skill or judgment of the seller or credit broker. A number of aspects of that section should be noted.

The purchaser, if he wishes to rely on the implied conditions, must make it known to the seller or credit broker, either expressly or implicitly, the purpose for which the goods are required. There is an obligation on the purchaser in some way to make known the purpose; there must be some action by him. Another aspect to note is that the implied condition covers whatever use the buyer has in mind as long as that use is made known to the seller or credit broker. That includes a wholly unlikely use. A third aspect is that the buyer cannot rely on the implied term where circumstances show that he does not rely on the seller or credit broker's skill or judgment, or it would be wholly unreasonable for him to rely.

That can be illustrated by examples. A buyer who wishes to rely on a seller's skills must make it clear what he intends. A purchaser who makes it clear that he wants to fill a bottle with boiling oil should not be supplied with a plastic one that melts on impact with the hot liquid. An expert builder should not seek to rely on the skill and judgment of an untrained assistant in a DIY superstore when purchasing building materials.

That demonstrates that that provision of the Act should remain as it stands. There is reference in the amendment to an implied term that the goods are reasonably fit for the purpose usually intended. But proposed new section 14(2)(b)(a) states that one of the aspects of satisfactory quality is fitness for all the purposes for which goods of the kind in question are commonly supplied". That part of the amendment appears to amount to no more than a repetition of what is already an implied term. To include it would cast doubt on what is already included in the Bill and could result in considerable confusion.

The amendment goes on to refer to what is reasonably foreseeable intended by the buyer". There is a danger that a court could interpret that as placing a higher burden on the seller than the present provision does. The existing provisions require the buyer to make some indication of his intention, but the formulation of the proposal is such that the seller may be deemed to have been in a position where it should have been reasonably foreseeable to him what the buyer intended, regardless of any activity, or inactivity, on the part of the buyer.

The amendment goes on to refer to the "commercial reputation" of the seller. I do not think that that can have any relevance in the matter. The purchaser of goods is entitled to the same level of protection whether he purchases from a household name or from a small trader. The law should not in any way suggest that there is any difference between the requirements applicable to small traders and those applicable to retail chains. The purchaser should always be entitled to the same rights.

I hope that I have answered the points raised by hon. Members. Hon. Members on both sides of the House want the Bill to go through. It has been discussed in this place before, in 1989. It has been discussed on Second Reading and in Committee. We have gone to considerable lengths to discuss it again this afternoon. I see no reason to delay the Bill any further. I hope that the amendment will be withdrawn.

Mr. Waterson

I support the principles and thinking behind the amendments. It was unfortunate and, if I may say so, contradictory that the hon. Member for Tyne Bridge (Mr. Clelland), the sponsor of the Bill, indicated at the beginning of his speech that he thought that it would be helpful to hon. Members, and perhaps make it unnecessary for them to contribute, if he spoke at that point in the debate. He then proceeded, on at least two occasions, to refuse to accept interventions from me. I assume that his intention was genuine, but if he had accepted my intervention my remarks now might not have been necessary. Perhaps he and the House would like to reflect on that as the debate develops.

The Bill is important. I was not in the House in 1989 and so did not have the benefit of debating the matter then. It is important, not least to my constituents and those of other hon. Members. We have lost one important piece of business today thanks to the manoeuvres of Opposition Members, and I hope that that will not be the case with this Bill. It matters to ordinary members of the public who buy goods in the way of business or otherwise. It is important that we understand what "in the course of business" means. Some Opposition Members have tunnel vision during such debates. We are discussing an important measure. Other important measures appear later on the Order Paper and an important measure was lost earlier. I deprecate the sneering attitude that some hon. Members have adopted to an important and technical piece of legislation. I hope that we shall hear no more of that language in speeches or sedentary interventions.

Mr. Barry Sheerman (Huddersfield)

On a point of order, Mr. Deputy Speaker. This is not acceptable. We all know that the hon. Gentleman is filibustering just after a Division when, breaking all conventions, we had a payroll vote. How dare the hon. Gentleman cast aspersions on hon. Members who support a Bill that we are to come to later? It is not right.

Mr. Deputy Speaker

Let us get on with it.

Mr. Waterson

I withdraw no aspersions. The remarks of the hon. Member for Huddersfield (Mr. Sheerman) were wholly inappropriate and I withdraw not a word of what I said.

Mr. Sheerman

The hon. Gentleman would not; he is an unctuous slob—[Interruption.]

Mr. Deputy Speaker

Order. I apologise—I did not hear what the hon. Gentleman said. If he said anything that fell outside parliamentary language, he must withdraw it.

Mr. Sheerman

I do not think that "unctuous slob" is unparliamentary.

Mr. Deputy Speaker

The Chair happens to think that it is unparliamentary, and I should be grateful if the hon. Gentleman would withdraw it.

Mr. Sheerman

I reluctantly withdraw the phrase.

Mr. Waterson

I reluctantly accept that reluctant withdrawal. I hope that we can now make progress. I am several minutes into my speech and have not got to the meat of it. The reason for that lies entirely with Opposition Members. Let us now make progress, as we should all like to do.

The concerns underlying the amendments are important and deserve to be considered. If I can be reassured by remarks made by the hon. Member for Tyne Bridge or the Minister, that will be splendid. We are in a different era from when legislation on the subject was originally introduced. When the sale of goods legislation was introduced, we considered a simpler position whereby there was little option between buying goods in a shop, which is clearly in the course of business, and buying goods privately, perhaps from a neighbour, or through classified advertisements in the local newspaper. But now, as my hon. Friend the Member for Cambridgeshire, South-East (Mr. Paice) has said, the distinction is blurred.

My hon. Friend related stories of people who respond to classified advertisements and discover that they are dealing with a commercial business such as a car showroom. We heard about the practice of shop squatting, which occurs in my constituency. Local authorities have occasionally been reduced to putting skips full of earth outside premises to stop shop squatters gaining access.

Mr. Clelland

On a point of order, Mr. Deputy Speaker. Will you rule on whether the hon. Gentleman is talking about anything to do with the Bill? Shop squatting and skips outside shops have nothing to do with the Bill.

Mr. Deputy Speaker

The hon. Member for Eastbourne (Mr. Waterson) is in order; if he were not, I would have ruled him out of order.

Mr. Waterson

If the hon. Member for Tyne Bridge had held his peace for a millisecond longer, I should have come to the subject of car boot sales, on which I hoped to intervene during his speech when he rattled through his Department of Trade and Industry brief.

Car boot sales are a problem in all sorts of ways. There are few Members of Parliament who have not had to deal with the range of problems associated with car boot sales such as planning and traffic matters. Many of us—I am no exception—regularly receive letters from people who have acquired items that are new or second hand at such sales. They are a substantial business—at least in my part of the country, in Sussex, and I dare say in other parts of the country as well. That is why the definition of in the course of a business is so important.

My hon. Friend the Member for Hertfordshire, North (Mr. Heald) spoke of where the definition draws the line—whether the business is defined by the place where the property is acquired or the activity of the seller. My hon. Friend wondered whether someone who sporadically sold items would fall within the definition. That is precisely what I want to know from the hon. Member for Tyne Bridge. If someone occasionally, not necessarily every week or every weekend, goes to car boot sales, rents a pitch and sells items that are new or second hand—it is common ground that the sales of goods legislation applies every bit as much to second-hand goods as to new ones—and a member of the public buys an item, is that transaction caught within the wording of the Bill? I do not know whether the hon. Member for Tyne Bridge wants to deal with that issue—apparently he does not.

One way to approach the subject is to look at the ordinary life style and business of the seller. Perhaps my hon. Friend the Minister will comment on that subject. Perhaps the tax law can assist us. Will the person who is selling on a part-time basis be caught by the tax provisions, and is what he or she is doing a business? If tax is paid, will it be capital gains tax or income tax?

I have one reservation about amendments Nos. 15 and 16: I wonder whether they are drawn a little too wide. Any law student will say that there is already an enormous body of case law on the sale of goods. I hope to speak later on the word "merchantable", which has acquired a massive body of case law—I regret its proposed demise. The same will apply to the amendments, which are loosely worded. My hon. Friend the Member for Cambridgeshire South-East said that he did not have the expert assistance from which the hon. Member for Tyne Bridge benefited. With due respect to my hon. Friend, perhaps the Government draftsmen can do a better job. My only reservation is whether the amendments, if accepted, will produce a substantial volume of new case law, which is the last thing we need on the subject of sale of goods.

Mr. Edward Leigh (Gainsborough and Horncastle)

It seems that when one speaks on the subjects of Bills one has to provide one's provenance to prove that one has a genuine interest in the subject. I spoke on the subject in 1989. I think—I do not know—that I am the only Member present today who spoke on the Consumer Guarantees Bill in 1990. For those who are interested in great speeches, my remarks can be found in columns 1221, 1222 and 1223 of the Official Report of 26 January 1990. I opposed the Bill then because I thought that it was far too widely drawn. I do not know whether it was as a result of opposing the Consumer Guarantees Bill that shortly after that I was made a Minister with responsibility for consumer affairs. I have taken an interest in such matters for some time.

Although a number of us opposed the Consumer Guarantees Bill on 26 January 1990 because we felt that it was drawn too widely, it was in many ways a forerunner of the Bill that we are discussing today. When I was a Minister with responsibility for consumer affairs, I took an interest in such matters, not least because, as a lawyer, I had been involved in them for a number of years. I had hoped that we would manage to produce a wider consumer Act. Replacing "merchantable quality" with the words "satisfactory quality" has been a controversial issue for a long time. The law commissioners dealt with that at some length and the Bill of the hon. Member for Tyne Bridge (Mr. Clelland) is useful. There is no doubt that, whatever one's romantic feelings about an old-fashioned term such as "of merchantable quality", the Bill is long overdue.

I regret that the Government, for very good reasons, have been unable to introduce a Bill in Government time —we understand the pressures on the legislative timetable—but this is a useful Bill which we should all welcome. It is precisely because it is useful that I oppose the amendments moved by my hon. Friend the Member for Cambridgeshire, South-East (Mr. Paice).

My hon. Friend is not a lawyer, and it is perhaps because he is not a lawyer that he spoke so clearly on a complex subject. I shall deal in a moment with the concerns of my hon. Friends the Members for Monmouth (Mr. Evans) and for Hertfordshire, North (Mr. Heald). I understand the concerns expressed by my hon. Friend the Member for Cambridgeshire, South-East that led him to table the amendments. I hope that I shall not sound too much like a negative lawyer, but I believe that the amendments would be unworkable. If, by some mischance, they were to be accepted, they would drive a coach and horses through the Bill and provide new opportunities for litigation. They would be a lawyers' paradise. I do not know What my hon. Friend the Minister is going to say, but I suspect that it will be very similar to what I am saying.

12 noon

I understand why my hon. Friend the Cambridgeshire, South-East tabled the amendments. He is worried about Sunday markets and I, too, constantly receive complaints about car boot sales. I suspect that he was speaking as a frustrated layman and on behalf of his constituents when he said that the public should be protected. The people who set up at car boot sales are effectively masquerading as business men. The public should therefore be protected as they would be if they were dealing with a business. I agree that a member of the public cannot possibly know the nature of the business involved in a car boot sale or a shop squat. My hon. Friend said that the Bill should be restrictive and that only the wholly private seller should be excluded from its provisions. He felt that the amendment would make that clear.

I receive many complaints from my constituents, especially about Hemswell market near Gainsborough where people have bought what they subsequently considered to be shoddy goods but had no redress. I confess that I receive fewer complaints about goods from people who have bought them at car boot sales than from reputable businesses in Gainsborough which believe that such goods have fallen off the back of a lorry. It is not so much a question of the goods being shoddy and the public not receiving a perfectly satisfactory buy; the people who are suffering are not those who attend Sunday markets such as that at Hemswell but the reputable traders of Gainsborough who are losing business and the ordinary people of Gainsborough whose videos and other goods have perhaps been stolen.

Unlike my hon. Friends the Members for Cambridgeshire, South-East and for Monmouth, I do not believe that the main problem with car boot sales is the nature of the goods sold there. I suspect that members of the public who attend car boot sales know that they are taking a slight risk because they are not going to a reputable shop. They know that such sales take place on an ad hoc basis. They wander around enjoying themselves and hope to get a bargain.

Mr. Michael Fabricant (Mid-Staffordshire)

Does my hon. Friend accept that people buying goods such as tape recorders at car boot sales are often assured that the goods will work but find that they do not when they get them home? In the present circumstances, they have no redress.

Mr. Leigh

My hon. Friend is quite right. It is precisely for that reason that I would not buy a video or a tape recorder at a car boot sale. I would have the common sense—I suspect that many of my constituents have, too—to know that, if one goes to a car boot sale and picks up a lemon, one has no redress. That is the nature of the deal—that is life. It is the give and take of commercial life.

Let us consider what would happen if the amendments were passed. Anyone selling items at a car boot sale or any kind of informal gathering would have placed on him an obligation as onerous as that placed on an ordinary shopkeeper. A potential purchaser could attend the sale determined to buy something dirt cheap—it could have fallen off the back of a lorry—but do so in the knowledge that the item he bought was covered by the implied term "satisfactory quality". He would therefore win in every way.

The amendment would therefore promote the very shop squats and car boot sales about which the House is worried, whereas we want to protect reputable shopkeepers who are paying rates and rents. I hope that my hon. Friend the Member for Cambridgeshire, South-East will accept that the amendment would not only mean a massive increase in litigation but would achieve precisely the opposite of what he wants and harm reputable shopkeepers.

Mr. Fabricant

My hon. Friend is right to say that anyone attending a car boot sale should not expect the same quality of goods that one buys in a shop and that we should not seek to place the same onerous responsibilities on a car boot salesman. However, if one finds a bargain and asks the person selling it whether both rings on the cooker work or whether the tape recorder works, one asks a specific question to which one receives a specific answer. In that case, it is surely wrong for the car boot salesman to lie. Should not there be redress in such circumstances?

Mr. Leigh

That is a different situation. If there is misrepresentation, various forms of traditional legal redress are available under common law, if not statute law. My hon. Friend the Member for Monmouth has more experience of this than I. We are debating an implied term. Is my hon. Friend the Member for Mid-Staffordshire (Mr. Fabricant) arguing that the new implied term "satisfactory quality" should apply to goods bought at informal gatherings?

I am not in the business of protecting people who misrepresent goods. If I, as a private person, wish to sell my car and go out of my way to misrepresent it, there would be a right of redress against me, or at least the possibility of damages. The consumer could come back to me. I hope that no one is suggesting that if I sell my car as a private person, I should be bound by the same implied terms that would cover a commercial car salesman. I am open to persuasion, but I hope that, whatever his concerns, my hon. Friend will withdraw the amendments.

My hon. Friend mentioned classified advertisements, but he did not make a very powerful case. Under modern law, one is entitled to know whether a classified advertisement has been put in a newspaper by a commercial salesman or a private individual. The situation is quite different at a car boot sale where one is face to face during a transaction. One can ask someone questions face to face. It is difficult to ask a classified advertisement about what is being sold, but one can ask someone who is trying to sell something at a car boot sale where the goods come from and what the nature of the person's business is.

Similar arguments apply to the amendments tabled by my hon. Friend the Member for Monmouth. He is trying to take matters so wide that virtually anything that one says can be taken as a description. I appreciate that my hon. Friend is a lawyer; for all I know, he may still be in practice. However, I am sure that when he thinks these matters through he will realise that, once again, this is simply an opportunity for opening up vast areas of litigation.

Like my hon. Friend the Member for Monmouth, I am nostalgic for the old term "merchantable quality", but I am sure that my hon. Friend would accept that the ordinary member of the public has no idea what that term means. I hope that, although my hon. Friend is, as I am, a conservative, he will realise that the term "satisfactory quality" is a far more modern term which the man on the Clapham omnibus can understand.

When I was doing my law finals, I did not understand what "merchantable quality" meant, but I was too shy to ask my law teachers. I am still not entirely sure what it means. We have in the Bill satisfactory wording that a reasonable person, if he is buying from someone who is engaged in sales in a commercial sense, can understand. He will know that there is an implied assurance of satisfactory quality. If we were to take matters further, we would not improve the legislation.

I know that what I am saying is, in the words of my hon. Friend the Member for Monmouth, that there will be all sorts of Arthur Daley-type salesmen who will get away scot free. That has always happened in real life. We can rely on the good sense of people who go to Sunday markets to know what is going on and to take particular care. I hope that, on mature consideration, we shall leave the Bill unamended.

Mr. Matthew Banks (Southport)

I am grateful for the opportunity to contribute to this short debate. I do not propose to detain the House long as there is important business after this which I know that a number of hon. Members present wish to address.

I very much endorse the comments made by my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh). I believe that the Bill should be left alone. However, I believe that my hon. Friends the Members for Cambridgeshire, South-East (Mr. Paice) and for Monmouth (Mr. Evans) made some powerful and telling comments. I shall pick up one or two of their points and refer to two or three of the amendments.

If you will allow me, Mr. Deputy Speaker, I feel that it is necessary to make one important point. I was not present for the debate on the Inshore Fishing (Scotland) Bill, although I have sought to speak on this Bill. In view of some of the rather unpleasant exchanges during the previous Division, I feel that it is necessary to say that I propose to speak with considerable brevity. It is well known that within my constituency I have been a campaigner for disabled people, both before and during my time as a Member of Parliament. I am also a registered disabled person myself, so I hope that it will not be necessary to listen to any nonsense by way of sedentary interventions by Opposition Members.

With regard to amendments Nos. 7 and 11, I am especially concerned about the suggestion that members of the public should have adequate protection if they buy goods from a particular seller. What concerns me more than anything else is the suggestion that it should be possible to provide consumer protection for those who buy goods from a particular source. I am especially concerned about whether we should allow for protection in respect of goods that are bought from someone who appears to the buyer to be a reputable seller, but who turns out not to be a reputable seller of the goods.

12.15 pm

Amendment No. 7 goes to the heart of the problem, but it will be rather unworkable. My hon. Friend the Member for Monmouth should think carefully about withdrawing it. I accept that the amendment would make it a requirement that the goods would need to be fit for the purpose reasonably intended by the buyer. However, I subscribe to the view put forward by my hon. Friend the Member for Gainsborough and Horncastle that the amendments would lead to a lawyers' paradise and that they are unworkable. The Bill should be left intact.

Amendment No. 15, to which my hon. Friend the Member for Eastbourne (Mr. Waterson) referred, would require that goods would need to be of satisfactory quality even if not sold in the course of business. This goes to the heart of my concern about how much one can legislate for. I want to see adequate consumer protection.

Mr. Roger Evans

The hon. Member for Tyne Bridge (Mr. Clelland) did not give way when I tried to intervene on this point. Bearing in mind what our hon. Friend the Member for Cambridgeshire, South-East (Mr. Paice) said when he introduced the amendments, it is unrealistic to look at amendment No. 15 without looking at amendment No. 16, as they are part and parcel of the same proposal. It is not being suggested that all private sales should be covered. What is being proposed is that whenever the seller sells goods in the course of a business and otherwise when in all the circumstances it is reasonable to imply the same", such sales should be caught.

Mr. Banks

I am grateful to my hon. Friend for clarifying his position; that is especially helpful. I assume from what my hon. Friend has said that he does not seek to over-legislate.

Mr. Evans

indicated assent.

Mr. Banks

My hon. Friend indicates that he does not seek to over-legislate and I am grateful to him for that. Under the law as it stands, the only implied terms when the seller is not acting by way of business are that the seller has good title and that the goods are as described. However, I am not convinced that the amendments should be accepted. It will be for my hon. Friend to decide on the appropriate course of action later.

The hon. Member for Tyne Bridge (Mr. Clelland) referred to the question of buyers having different rights depending on when or where they bought their goods. My contention is that it will be especially difficult to legislate for all the occasions when a member of the public buys an item from one source or another.

I hope that the Bill will move smoothly through the House today. I want it to be workable and enforceable, and I want it to provide adequate protection for the public. I did not have the opportunity to speak in the House in 1989, but I have taken a particular interest in consumer protection both before and during my time in the House and I am grateful to be able to speak in the House, albeit briefly, on this important Bill and the amendments.

Dr. Liam Fox (Woodspring)

In view of the time and the brevity of other contributions, I shall restrict my comments to amendment No. 11. My hon. Friend the Member for Monmouth (Mr. Evans) is normally a straight-down-the-line, deregulating, free-market Conservative, but there are always one or two occasions when job creation gets the better of hon. Members, especially lawyers, who regard this legislation as especially beneficial in terms of job creation for them. The clause is the classical intrusion of the nanny state into what reasonable members of the public can decide for themselves when they buy goods. My hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) made that point clearly.

The idea that we must include commercial reputation, brand name, advertising and marketing is simply nonsensical, because whether or not an individual buys a product is not built purely on what influences are brought to bear by advertising, or by brand name and so on, but on the experience that they have in the products that they have previously brought. For example, if somebody buys Sainsbury's cola because it happens to look like a can of Coke and finds that it tastes terrible, they would go back and buy Coke the next time, irrespective of the advertising pressure on them. That is just common sense, which members of the public have.

How are we to interpret the amendment? For instance, if I say that I am selling my car and that it is a Rover, one owner, does that somehow mean a great deal more in law, irrespective of whether I have been a dreadful driver or a very good driver and have looked after my car well, because Rover may be a good brand name?

Mr. Leigh

We must persuade my hon. Friend the Member for Monmouth (Mr. Evans) to withdraw his amendment, because it is nonsense on stilts. We have all bought second-hand cars. As I understand it, my hon. Friend the Member for Monmouth is saying that just because there had been advertisement which advertised a Rover or a Volvo as a safe or a beautiful car or whatever, somehow the person selling one three or four years down the line would be bound by that advertisement. That is absolute nonsense. My hon. Friend cannot have thought the matter through.

Dr. Fox

My hon. Friend makes the point for me. How far can we take it? For example, am I to take my jeans back to the store because in the advertisement it was possible to roll down a hill in them quite happily, but when I fell over in the street they ripped? Am I somehow being sold goods that are unsatisfactory? If my teeth do not turn out perfectly white in the morning like those in the Pearl Drops advertisement, am I somehow being sold unsatisfactory goods? If I climb up a mountain in a jungle and am sweaty at the end of it, despite having used a particular deodorant, does that make that product null and void?

The amendment is nonsensical and the worst kind of intrusion into the freedom that individuals ought to have to use their own judgment in buying goods. I hope that we shall not allow such a terrible, nannying intrusion into a Bill which is otherwise quite acceptable. Clause 1 is fine. We do not need the amendment. It is the worst sort of intrusion, saying that the public cannot make up their own minds, that we have to decide everything for them and put it into to detailed legislation, giving lots of jobs to the lawyers on the way. I hope that my hon. Friend will seek leave to withdraw the amendment.

Mr. McLoughlin

We have had the benefit of the explanation of my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh), who welcomed the Bill and, indeed, his substantial recognition of the direction that it is taking. In the light of various allegations that have been made over the past few days, it is worth pointing out that the Government have helped the hon. Member for Tyne Bridge (Mr. Clelland) both in bringing forward the Bill and in giving him help and advice on the amendments drafted by hon. Members. A lot of nonsense has been talked about something that has been a long-standing practice when private Members' Bills are brought before the House.

Mr. Sheerman

May we get the record straight? There are no allegations about when the Government quite properly help someone like my hon. Friend the Member for Tyne Bridge (Mr. Clelland) with a Bill of which they approve, which has support on both sides of the House, provided that it is open and above board. The only controversy that arises is when things are done behind the scenes in an underhand way and a Minister misleads the House about what is going on. That has nothing to do with my hon. Friend the Member for Tyne Bridge and the conduct of business in respect of his Bill.

Mr. McLoughlin

As I said, I did not want to resurrect that particular argument. I was merely putting on record the fact that help has been given to the hon. Member for Tyne Bridge by the Department of Trade and Industry because we welcome the Bill.

With regard to the amendments and the speeches that have been made, my hon. Friend the Member for Monmouth (Mr. Evans) has had a bit of a drubbing from his own side, which he is not used to, for not being the kind of deregulator that we expect him to be. However, he asked me a specific question about section 14(6). I accept that the Bill is complicated and I said that I would give some clarification in the presence of the Consumers Association. This is not the right place to give that clarification, so I shall provide it later. In answer to my hon. Friend's point, section 14(6) has been repealed and has been replaced by different words. I refer him to schedule 2, page 17, line 25, which he now has readily to hand. I hope that that covers some of his concerns.

My hon. Friend the Member for Cambridge South-East (Mr. Paice) in introducing the group of amendments, which includes amendments that he and my hon. Friend the Member for Monmouth tabled, gave a warm general welcome to the Bill. I am grateful for that because I think that the Bill will go a long way to enact what has been suggested to us by the Law Commission as a sensible set of proposals. History has shown that the measure has had an unfortunate record, falling almost at the final stage. My hon. Friends the Members for Gainsborough and Horncastle and for Woodspring (Dr. Fox) and others have said why they believe that the amendments are not suitable to form part of the Bill. The Bill goes a considerable way towards enhancing consumer protection, straightening out the consumer protection law, especially applying to some of the concerns which came out of the Bernstein case, and is broadly welcomed by all.

My hon. Friends the Members for Mid-Staffordshire (Mr. Fabricant) and for Eastbourne (Mr. Waterson) referred in passing to the problems of car boot sales. They rightly reflected a concern, but it is not the purpose of the Bill to deal directly with car boot sales. There are bits of consumer legislation which deal with the description of car boot sales and are already covered in the Bill.

I hope that hon. Members will forgive me if I deal specifically with the amendments before the House. The Government oppose amendment No. 15. It would be wrong to impose on a seller, who is not acting by way of business, the full obligations of a seller who is acting by way of business. In appropriate circumstances, an individual may be acting by way of a business and the implied terms of quality would, therefore, apply to him. Most sales by private individuals, however, are not like commercial sales.

The requirements that goods should be described can already be quite a stringent requirement. For example, if I were to sell my car and describe it as having no rust, as doing 40 miles per gallon and as being capable of 0 to 60 mph in 15 seconds, it would have to meet that description. I must say that, if my car could do that, I would not be selling it. However if I were to put it on the market, it would have to meet that description. However, I would be setting out a description of the car and I would therefore have a responsibility to ensure that that description was met. I hope that that goes some way towards meeting the points raised by my hon. Friend the Member for Cambridgeshire, South-East.

With regard to amendment No. 16, I assume that my hon. Friend the Member for Cambridgeshire, South-East intended the word "imply" to read "infer". If that is so, the effect would be to create an area of doubt as to whether the implied term as to satisfactory quality applied in certain contracts. It would be clear that it did where the seller was acting by way of business and clear that it did not if the seller was not acting by way of the business. Those circumstances can be tested objectively, but in between there would be a grey area as to who was doing the inferring. If it were the buyer, that would be a very subjective assessment and it would create great uncertainty. If the intention were to use "imply", the only person able to imply that he was acting by way of a business would be the seller. Any seller who implies that he is acting by way of business most probably is. The wording in amendment No. 16 is not quite right and I hope that my hon. Friend will not press it.

Mr. Roger Evans

Simply from reading the words, the party doing the implying is surely the court. That is what the wording must mean.

Mr. McLoughlin

I take the point that there is always substance in respect of the court implying. My hon. Friend has cleared the point up and I am grateful to him for that.

The aim of amendment No. 10 is already sufficiently covered by other items taken into account in assessing whether goods are of satisfactory quality. In particular, the description of goods must be taken into account. Moreover, the list of items is not a closed list. It includes additional and other relevant circumstances.

With regard to amendment No. 11, it is inappropriate to consider the reputation of the seller when assessing the quality of goods. That would lead to a particularly peculiar situation in that identical goods could be deemed to be satisfactory if sold by one seller, but not satisfactory if sold by another.If the seller applies a description to the goods, such a distinction may be appropriate, but that is already covered elsewhere in the subsection.

12.30 pm

We must consider the Bill in conjunction with the Sale of Goods Act 1979

Notice being taken that strangers were present, MR. DEPUTY SPEAKER, pursuant to Standing Order No. 143 (Withdrawal of Strangers from the House), put forthwith the Question, That strangers do withdraw:—

The divided: Ayes 1, Noes 25.

Division No. 248] [12.30 pm
Montgomery, Sir Fergus
Tellers for the Ayes:
Mr. Alan Howarth and
Mr. Greg Pope.
Arbuthnot, James McLoughlin, Patrick
Arnold, Sir Thomas (Hazel Grv) Mayhew, Rt Hon Sir Patrick
Atkinson, Peter (Hexham) Newton, Rt Hon Tony
Banks, Matthew (Southport) Paice, James
Conway, Derek Scott, Rt Hon Nicholas
Evans, Roger (Monmouth) Stewart, Allan
Fabricant, Michael Townsend, Cyril D. (Bexl'yh'th)
Fox, Dr Liam (Woodspring) Waterson, Nigel
Greenway, Harry (Ealing N) Wheeler, Rt Hon Sir John
Hughes Robert G. (Harrow W) Wood, Timothy
Hunt, Rt Hon David (Wirral W)
Kirkhope, Timothy Tellers for the Noes:
Kynoch, George (Kincardine) Mr. John Austin-Walker and
Leigh, Edward Mr. Dennis Skinner.
Lloyd, Rt Hon Peter (Fareham)

It appearing from the report of the Division that 40 Members were not present, MR. DEPUTY SPEAKER declared that the Question was not decided, and the business under consideration stood over until the next sitting of the House.

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