§ Order of the Day for the Second Reading, read.
§ THE MARQUESS OF SALISBURY,
in rising to move that the Bill be now read a second time, said: My Lords, this is a Bill which involves considerations of very great importance to the agricultural interest; and I should have thought that it would, as a matter of course, be read a second time and referred to a Select Committee. It has had the misfortune, however, to attract the unfavourable notice of my noble 1046 Friend at the Table (the Earl of Redesdale); and in face of his hostility, which is always regarded, and justly regarded, as so powerful in this House, I am bound to lay before your Lordships the reasons why I think this Bill ought to be read a second time, and referred to a Committee to examine its details. I wish to lay emphasis on this fact—that I am urging the second reading of this Bill because, by so doing, I shall relieve myself of the necessity of going into a number of details, of which the Bill is full, and which, if they are challenged, can be remedied in Committee. I am only asking you so far to approve the main principle of the Bill as to send it in the ordinary course to be examined by a Select Committee. What is the principle which I am urging on your Lordships to accept? You are aware of the great disasters which have befallen agriculture during recent years, and one of the worst consequences of those disasters is that agricultural credit has almost entirely disappeared. Before the bad years money was lent largely to farmers—at a very high rate of interest very often, but still lent—and the farmers had money on which to work; but when the bad years came these loans were drawn in, very often to the ruin of the farmers and the suffering of the banks. There is, in fact, no agricultural credit, speaking generally and roughly, to be had; and if the law remains in its present state there is no prospect of an early revival of agricultural credit, because the security is not sufficient, considering the smallness of the profit, to invite investors to invest their money in such enterprizes. The proposal in this Bill is to enable a Company of capitalists to lend money to the farmer against his crop—against the crop which the money advanced is intended to raise; so that if he intends to raise an expensive crop in a certain field he shall be at liberty to pledge that individual credit, that crop, to pay the interest and the capital by which, the crop is raised. That cannot be done now, because the mixture of chattel interest in the crop and the farmer's own interest in the land prevent the ordinary machinery of a bill of sale from being applied. You will say—"What possible objection can there be to a capitalist being allowed to advance money upon a crop to be repaid 1047 out of the proceeds of that particular crop, the crop being ear-marked for the purpose?" Well, the objection is this—that there are other creditors upon the farmer's holding, and that the new creditor will stand before these others. But it is to be noticed that it is not proposed that the capitalist should stand before the landlord, because that would not be just. The landlord furnishes the land, and the capitalist furnishes the capital; and it would not be fair that the capitalist should come and thrust the landlord aside and stand before him. The landlord's interest is, therefore, saved. He has an absolute priority on any proceedings under this Bill; but after the landlord the crop is set aside in order to pay the capital by which it has been grown, and no other creditor of the farmer, as respects that crop, can step in and take it. It seems that that in itself is a perfectly just proceeding, because but for the advance of the loan there would be no crop grown; and it is certainly for the public interest that the crop should be grown; and, therefore, it is for the public interest that the capitalist should be allowed to have a lien on the crop. The same has been done in other countries—in New South Wales, for instance, where, in many instances, money is lent for the crop on the security of the crop. But in the present instance we have a precedent, and in this country precedents are invaluable. We have the principle of an advance specially guaranteed from the land by the Act of 1864, under which lenders were empowered to lend money to landlords to enable them to make improvements upon the land, and that stood in front of all mortgages which might previously have been upon the same land. We ask you to do for the farmer what has been done again and again, and on an enormous scale, for the owner. We ask you to enable the occupier to pledge the improvements which he has made by the money lent for that purpose. The owner can do that already, and it is just that the occupier should be able to do it. It is, however, not only just; unless it is done the agricultural interest cannot rise again for a long time from the depression in which it is. I have heard of one solid argument against the principle of this Bill, and that is, that if this is a good thing it should be done by a Public 1048 Bill. But my answer to that is that in the present state of Business in Parliament it is laughing at us to say that you must pass Public Bills. You can only pass large Bills behind which there is great pressure; but a Bill which aims at nothing but doing good cannot be passed. But to tell us that because one Parliamentary road is blocked up therefore we must not try another which is open is merely to laugh at the misfortunes under which agriculture is labouring. We have, however, something more powerful than argument or common sense. We have a good precedent. This very thing has been done again and again in favour of the owner—that is, Private Bills have been passed on the subject before any Public Bill. A Public Bill was not passed until 1864. Again and again Private Bills were passed before that date. Amongst these there was the Act passed in 1848 with regard to the West of England Company which obtained this privilege. In 1849 there was the Act conferring the power on the General Land Drainage Company; in 1853 there was the case of the Lands Improvement Company; in 1856 the Scottish Drainage Company, and in 1860 another Company, obtained this power. All these were Private Bills, and we only ask to do for the occupier what has been done again and again for the owner; and I am sure if this Bill becomes law it will confer enormous benefits on that interest which is now suffering so severely, and which of all other interests in the country is deserving of your Lordships' consideration.
§ Moved, "That the Bill be now read 2a"—(The Marquess of Salisbury.)
§ THE EARL OF REDESDALE (CHAIRMAN of COMMITTEES)
said, it was his duty, occupying the position which he did, to oppose this Bill. Nothing could be more dangerous than to allow private legislation to supersede public legislation. The effect of this Bill would be, if passed, that an example would be set in favour of placing private before public legislation. In other words, this Bill practically did away with the Bankruptcy Act, for the tenant was protected against the operation of the Bankruptcy Act under the operation of this Bill. The tenant also came under a contract of partnership with this Company, and the effect of the Bill would be that 1049 there would be an example set of legislation for private purposes, setting aside that which was already public law relating to such matters. He considered that nothing could be more dangerous than tampering with the law. If his noble Friend would introduce a Bill of a general character dealing with the objects he had in view, he would pass it through this House; and if its objects were desirable, he had no doubt it would also pass through the other House of Parliament. He denied that it was impossible to find time to pass a Public Bill on this subject. There were many Public Bills that did pass as well as Government measures; and no doubt if a Public Bill were introduced it would receive every attention from the two Houses. The public law with regard to debtor and creditor was set aside by this Bill. He wanted to know why a Company should have power to advance money for such purposes? Why should a landlord not have the same powers? He had no interest in the Bill one way or the other; but he held that it was an improper Bill for the House to sanction in the shape of private legislation.
§ THE LORD CHANCELLOR
said, he must express his concurrence in the objection taken by the noble Earl the Chairman of Committees, as to the principle of the Bill. He was very sorry to object to any Bill which was brought forward to benefit the agricultural interest. He felt as acutely as anyone the present position of agricultural industry; but he felt also the importance of the principle involved in maintaining the proper line of demarcation between public and private legislation, and that principle greatly exceeded the importance of this Bill. Private legislation concerned only the interests of private persons or private Companies, and no person had a locus standi against a Private Bill except the persons who claimed to have private interests with which it interfered. All those persons, and those only, might be heard against it. Questions of public policy were never considered at all; and it therefore appeared to be absolutely vital to prevent any inroad, by Private Bills, upon that province which public legislation had already occupied. If this Bill had been introduced as a Public Bill he should have offered no objection to the second reading. It was said there was 1050 a difficulty in passing a Public Bill; but that suggestion only added to the force of the objection. It was important to take care that, because there was a difficulty, Private Bills were not introduced instead of Public Bills. In the case of a Public Bill, every man was supposed to have notice; but of Private Bills no public or general notice was given. A Public Bill was publicly debated, in both Houses, in all its stages; but a Bill like the present would not be considered at all, except in a Select Committee, without opponents. These Private Bills were scarcely ever circulated; and when they passed they were not printed with the Public Statutes. Was it true that this Bill contained provisions which encroached on the province of public legislation? He thought it did, in several ways. It would affect, throughout the Kingdom, the rights of landlords and creditors. According to one of the clauses of the Bill, when the Association was going to lend money to a tenant it must give 14 days' notice to the landlord, who, if he pleased, might refuse his consent. That applied only to tenancies of over 12 months' duration. When the landlord received the notice he might know nothing about the Act, or anything connected with it; and before he could consult his solicitor the time for objecting under the Act might have expired, or else his solicitor would have no more time than might be left of the 14 days to make all necessary inquiries about the matter. If the tenancy was for 12 months, or any less period, the landlord was only at liberty to object to the transaction on one or other of two grounds. One was that the tenant was bound, by his covenants, not to do those things, for which he proposed to borrow the money. In the great majority of cases that was not likely to be the case; and therefore that ground might be put aside. The other ground was that the tenancy would be determined within 12 months; so that, in order to enable the landlord to object on that ground, he must turn out his tenant, which, otherwise, he might not have wished to do. If objection were made on either of the grounds mentioned, the Company could take the matter to the County Court, which would determine whether the objection was to hold good. But, supposing no objection were made, various rights were conferred on the Company, 1051 which were at variance with the public law. He would first take the case of the landlord dealt with by the 33rd section.
§ THE LORD CHANCELLOR
said, then, of course, his objection to that clause disappeared. If the other clauses to which similar objections in principle applied were also withdrawn, his objections would also be withdrawn. He would next take the case of a creditor of a person to whom money had been lent by the Company, and this brought out in the strongest possible way the objection of principle. The 31st and 32nd sections practically said that, if the occupiers in possession, having the apparent ostensible ownership of everything upon the land, became bankrupt, the ordinary law was to be entirely set aside, and the general creditors were to be altogether postponed, and absolute preference was to be given to this Company. This was to be done not by a Public Act, but by a private measure, about which tradesmen could know nothing, and in respect of which no communication was to be made to them. The effect of this change would be that an agricultural tenant would be empowered to enter into a contract with the Company by which he could prefer them to all his other creditors, and give them a preferential security on all his present and future movables and farming live and dead stock. All he could say was, that if that were a proper thing to do for the protection of agriculture, it ought to be done by public legislation, and the change in the law should be considered in all its bearings in both Houses of Parliament. The noble Marquess had stated that the principle of this Act had been embodied in some Private Acts already passed. It was impossible to say how far that was the case without an examination of those Acts. For his part, he had never heard of any private legislation being proposed before which superseded the Bankruptcy Act; and he might point out that in some of the Acts to which reference had been made, before an advance could be made it was necessary to obtain the sanction of a public Department—the Enclosure Commissioners; and all that was then done was to charge the property in the land 1052 against reversioners, if the Commissioners thought that they would derive benefit from the proposed improvements. One Act which had been referred to—that of the West of England Drainage Company—was in itself a warning. It enabled loans to be granted on the security of land, to ecclesiastical as well as other persons, without any of the usual and proper safeguards for the protection of the interests of successors; and one particular clergyman, without any ecclesiastical consent or oversight, mortgaged his glebe to the full extent of its value to the Company. Last Session the most rev. Primate (the Archbishop of Canterbury) had to come to Parliament for a general Public Act, which was passed to prevent such mischief occurring in the future.
§ THE DUKE OF MARLBOROUGH
said, that he could not endorse what the noble and learned Earl on the Woolsack had said with regard to Private Bill legislation. He thought that some of the most efficient work done in that House was the initiation of private legislation, especially on the subject of the landed interest of the country. While it was necessary for an Act of this sort to be publicly debated and considered in all its bearings, it was not absolutely essential for a measure of this sort to fulfil those conditions to quite the same extent as a Public Bill. The noble and learned Earl on the Woolsack had criticized the main blots of the Bill; but one observation could be made with respect to some of the loans to tenants. It was thought very objectionable by some persons to admit the principle of lending to tenants on standing crops, for they said that if a tenant were in such a position that he required to borrow on standing crops he was not in a proper condition to borrow at all. In the case of expensive crops, such as hops and beetroot, when the tenant's capital was insufficient, the assistance of the landlord would be very advantageous. For that reason, it appeared to him that there would be advantage in considering this measure on its merits before a Select Committee. Evidence would be taken to show what would be the best means of promoting a scheme which would meet the requirements of the situation. The situation with regard to agriculture was undoubtedly a serious one. They had not been able to get a Royal Commission to 1053 inquire into it; but their Lordships would admit that there was no industry in the country which so much required an inquiry at the present time. He ventured to think that if this Bill were referred to a Select Committee much valuable information might be obtained with regard to the best means of dealing with the question.
§ THE MARQUESS OF SALISBURY
I cannot say that the arguments of the noble and learned Earl on the Woolsack have convinced me. He has addressed himself almost entirely to technicalities, and those not of a very important character, contained in the Bill. He dwelt very much, almost playing with words, upon what he called the privacy of a Private Bill, and said that there was no sufficient opportunity of discussing a private measure. The procedure in a Private Bill is exactly similar to that in the case of a Public Bill, with the exception that it is submitted to a Select Committee in addition. It passes through all its stages in this House like any other Bill, and its contents are discussed in this House, not only as a matter of form, but in practice also. When the noble and learned Earl talks of no notice being received of such a Bill being passed, and of its being passed secretly, my impression is that more publicity has been given to this Bill than to most Bills that come before us. The noble and learned Earl has rested very much upon the grievances of the landlord, and the fact that he is only to have a fortnight's notice. I quite admit that that is too short; but I think that the second reading of a Bill is hardly the occasion on which to discuss a question of detail of that description. It is contrary to all our practice to make a consideration like this the ground for rejecting the second reading of a Bill; it is easy to rectify any such error in Committee. The noble and learned Earl practically did not deal with the Preference Clause at all. It appears to me that you have passed Bill after Bill doing for the owner precisely what you are now asked to do for the occupier, giving him priority for money lent for improvements. When you were being asked to give advantages to the owner, you never discovered all these technicalities. The recommendation to pass such a Bill as this as a public measure is utterly impracticable, and has no 1054 meaning whatever. I regret that the noble and learned Earl, and I presume Her Majesty's Government, have taken this view with respect to a measure which has undoubtedly an object of very great interest in view. I do not think, however, that there has been sufficient support of the measure in this House to justify me in pressing the second reading to a division.
§ LORD CARLINGFORD (LORD PRESIDENT of the COUNCIL)
desired to say, on the part of the Agricultural Department, that he had approached the consideration of this Bill with great interest, and with an intention, if possible, of supporting it. At the same time, it was impossible—and he thought most of their Lordships would feel that it was impossible—to resist the arguments of the noble and learned Earl on the Woolsack against the Bill on its present lines and in its present form. The noble and learned Earl had certainly taken objection to some of the details of the Bill; but he could not agree with the noble Marquess that the noble and learned Earl had rested his chief objection to the Bill upon any of these details rather than on much broader grounds. He could only say that if this Bill had been a public one he should have voted for it with great pleasure and satisfaction, although feeling that there would have been necessity for considerable change in Committee.
§ On question, resolved in the negative.