Lords Sitting of 16 September 1909

IRVINE HARBOUR ORDER CONFIRMATION BILL.
Brought from the Commons; read 1a; to be printed; and (pursuant to the Private Legislation Procedure (Scotland) Act, 1899) deemed to have been read 2a (The Lord Pentland); and reported from the Committee. (No. 175.)
ABERDEEN HARBOUR ORDER CONFIRMATION BILL.
Read 3a (according to order), and passed.

SECRETARY OF THE BOARD OF AGRICULTURE AND FISHERIES BILL.
[SECOND READING.]
Order of the Day for the Second Reading read.
THE LORD PRIVY SEAL AND SECRETARY OF STATE FOR THE COLONIES (THE EARL OF CREWE): My Lords, this measure is one which has passed in another place without opposition, and I venture to hope that its fate will be equally fortunate in your Lordships' House. For some time past there has been a feeling that the Board of Agriculture, although administered in turn by Statesmen of the highest capacity and experience, has not quite taken the place among public Offices to which its intrinsic importance undoubtedly entitles it. It deals with what, after all, remains our greatest national industry, and we should all agree, I think, especially in this House, that the Office which is concerned with that industry ought to be and to be treated as one of the first importance. It is proposed by this Bill to create a Secretary to the Board. As your Lordships know, the work of the Board in another place has been carried out, I think with general acceptance, by a gentleman who holds an office in His Majesty's Household; but it is felt, and I trust your Lordships will agree, that it is desirable that the representation as it now happens in another place should
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be placed on a more regular footing, and it is with that object that this Bill is introduced. I ask your Lordships to give it a Second Reading.
Moved, That the Bill be now read 2a.—(The Earl of Crewe.)
THE EARL OF ONSLOW: My Lords, I am very glad that His Majesty's Government have introduced this Bill. I have been very much in the same position as the noble Earl who is now President of the Board of Agriculture is in at the present moment. I have had to rely upon the services of a member of His Majesty's Household in the House of Commons, and I am bound to say that the duties which he discharged were discharged in the most efficient manner. At the same time there is no doubt a feeling in the House that if a Minister is not connected with the Department, with access to all the Papers, he does not represent the Department in the same fulness and with the same force as if he were the Secretary of the Department. The noble Earl said that for the moment the Board was represented in the other House by a gentleman who was not connected with it. By that I suppose he meant that the time might come when the President of the Board would be in the other House of Parliament and the Secretary would have to be in this. I think it would be a great advantage that we should always have in this House a representative of the Board of Agriculture. When I say that, I think it applies even more strongly to some of the other Departments, and I think it is a little singular that at the present moment we have no representative of the Foreign Office in this House. I cannot recollect a time since I have had the honour of a seat in your Lordships' House when there has been no representative here of the Foreign Office. Nor is there any direct representative of the Home Office or of the Admiralty. I am aware that it has always been a practice that some of the Departments should be represented in this House by some of those who hold office in His Majesty's Household, but I hope this Bill is an augury of good, and that His Majesty's Government will be led by the reception which this Bill has received to feel that the House desires that there should be a direct representative of all the important Departments, not only in the other House of Parliament, but also in this.
THE EARL OF CAMPERDOWN: My Lords, I do not rise to offer any opposition on this Bill, but I think that in the circumstances of the present moment the Bill ought not to be allowed to pass altogether without remark. In the raising of salaries of offices, in the creation of new offices, and in expenditure generally, the present Government have had no rival among any of the Governments that I can recollect; and if all their schemes at present in existence are carried out I am sure this country will be possessed of a bureaucracy such as it has never before enjoyed in its history, and His Majesty's Government will have earned the undying gratitude of all professions, such as valuers, doctors, and people of that sort, for whom unlimited places will have been created. I do not take exception to this particular instance of it because, as the noble Earl has said, it is quite right to have a Secretary to the Board of Agriculture; but I want to ask the noble Earl who leads the House whether when this Bill was drawn up there was any idea of another Bill which has just been introduced into your Lordships' House, and which, I suppose, at some time or other we may be asked to consider. The noble Earl the Secretary of State for the Colonies has so many things to do—I am sure I am very sorry for him—that he may very likely not have had time to observe that his colleague who sits near him (Lord Pentland) has just introduced a Bill by which he proposes to take away the Scottish portion of the work of the Board of Agriculture from his colleague Lord Carrington. It appears to me that if half the business of the office is to be taken away, what we ought to be considering is rather whether Lord Carrington's salary ought not to be reduced than a proposal to give him a Secretary. But very likely this Bill may have been introduced and entered on your Lordships' Journals without any reference to Lord Carrington, because, as we know, there is very little communication between some of His Majesty's Departments under the present Administration. However that may be, if the Bill is brought forward, there will no doubt be some criticism in your Lordships' House and it is not necessary for me to make any now. But I should like to know whether, when it was proposed to create this new position of Secretary of the Board of Agriculture, it was known that it was proposed to create an additional Office
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with regard to agriculture in Scotland which would deprive the present Office of a very considerable part of its duties.
THE EARL OF CREWE: My Lords, I can answer the noble Earl's question very easily. I am greatly obliged to him for the sympathy which he expressed so kindly for me regarding my multifarious duties, which I am afraid are more than I can properly carry out; but as regards this particular point I might refer the noble Earl to the debate which took place on the Second Reading of this Bill in another place. He will see there that the question of the Bill which has been read a first time on the motion of my noble friend behind me (Lord Pentland) was fully discussed, and that it certainly was with the full cognisance of everybody concerned with the production of this Bill that the Scottish Bill was also introduced. The two, as I think the noble Earl will see, are by no means incompatible.
On Question, Bill read 2a, and committed to a Committee of the Whole House on Thursday next.

MUNICIPAL ELECTIONS BILL. [H.L.]
[SECOND READING.]
Order of the Day for the Second Reading read.
LORD FARQUHAR: My Lords, the object of the Bill, the Second Reading of which I beg to move, is to extend to municipal elections the provisions of the Corrupt and Illegal Practices Prevention Act, 1895, by which a summary method is provided of punishing persons making false statements of fact, relating to the personal character or conduct of a candidate, for the purpose of affecting the result of the election. The Act of 1895 has worked very well and has proved very effective in stopping malicious calumnies about Parliamentary candidates, which were frequently circulated just before an election, too late to be contradicted. This Bill proposes to extend this protection to municipal candidates. So important are the administrative powers which are now wielded by municipalities that it has become essential to secure the purity of municipal elections, that they should be honourably conducted on public and not on private issues, and that the

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candidates should be protected from false statements affecting their character and conduct. Against such false statements the municipal candidate has at present no remedy except an action for slander, in which it is generally necessary to prove special damage, and which would not be heard for months after the election. It is absolutely necessary that those who utter such slanders should be dealt with promptly, and the Bill provides a rapid and effective remedy by summary procedure under which offenders can be dealt with immediately and the circulation of the slanders stopped. It not only provides a remedy, but will act as a deterrent. The Bill constitutes the making or publishing of any such false statements an illegal practice which involves a penalty on summary conviction of a fine not exceeding £100, with incapacity for five years of being registered as an elector within the constituency, and in the case of an offence made with the knowledge or consent of a candidate, renders his election void. The Bill is non-controversial, and should receive the support and sympathy of all quarters of your Lordships' House.
Moved, That the Bill be now read 2a.—(Lord Farquhar.)
THE LORD CHANCELLOR (LORD LOREBURN): My Lords, I think this Bill is a most excellent proposal. The Corrupt Practices Act is confined to Parliamentary elections, and the purpose of it is to prevent cowardly and mean statements about the personal character of, or personally about, the candidate at any time during an election. Conduct of that kind is not common, I am glad to say, in this country; but cases not infrequently occurred, and the worst of it was that these lies were circulated just before the poll and when there was no opportunity for contradiction. The Act was passed when I was a member of the House of Commons, and there was a general feeling that mean conduct of that kind ought to be promptly stopped, and the Act was passed for that purpose. Its effect has been admirable in connection with Parliamentary elections, and there seems no reason why it should not be extended to municipal elections.
On Question, Bill read 2a, and committed to a Committee of the Whole House on Monday next.

COLONIAL NAVAL DEFENCE BILL.
[SECOND READING.]
Order of the Day for the Second Reading read.
THE EARL OF GRANARD: My Lords, this is a small Bill to amend the Colonial Naval Defence Act, 1865. Under that Act Colonial Legislatures were permitted to raise Volunteers belonging to the Royal Naval Reserve under the Royal Naval Reserve Act of 1859. It is now desired to give an alternative power to Colonial Legislatures to raise Volunteers who should form part of the Royal Fleet Reserve under the Naval Forces Act of 1903. This is effected by Clause 1 of the Bill. The Legislatures of the Cape and Natal have already passed Acts for this purpose, and Clause 1 of this Bill validates these Colonial enactments. The Act of 1865 enables Colonial Legislatures to make provision for providing vessels of war and maintaining seamen to man them and placing these at the disposal of the Admiralty; but the officers serving therein can only be employed on ships belonging to the Colony. This Bill is to remedy these defects, and I trust that your Lordships will give it a Second Reading.
Moved, That the Bill be now read 2a.—(The Earl of Granard.)
On Question, Bill read 2a, and committed to a Committee of the Whole House on Thursday next.

NAVAL ESTABLISHMENTS BILL.
[SECOND READING.]
Order of the Day for the Second Reading read.
THE EARL OF GRANARD: My Lords, the object of this Bill is to transfer the dockyards of Halifax and Esquimalt to the jurisdiction of the Canadian Government. For some years past provisional arrangements have been made and these dockyards have been virtually under the jurisdiction of the Canadian Government, but it appears that there is some legal difficulty and that without an Act of Parliament they cannot be transferred to the Canadian Government. The transfer, of course, is made subject to conditions that the dockyards will be kept in proper order and available for the use of His Majesty's Fleet. I beg to move.
Moved, That the Bill be now read 2a.—(The Earl of Granard.)
On Question, Bill read 2a, and committed to a Committee of the Whole House on Thursday next.

TELEGRAPH (ARBITRATION) BILL.
[SECOND READING.]
Order of the Day for the Second Reading read.
THE EARL OF GRANARD: My Lords, according to the purchase agreement with the National Telephone Company of 1903 plant and other property are to be taken over by the Post Office and the price to be paid is to be subject to arbitration arranged by the Postmaster-General. The object of this Bill is to give further powers to the Railway and Canal Commission to determine differences with respect to telegraphs, including telephones. The matter has been before the National Telephone Company, who agree to the Bill.
Moved, That the Bill be now read 2a.—(The Earl of Granard.)
On Question, Bill read 2a, and committed to a Committee of the Whole House on Thursday next.

ASSISTANT POSTMASTER-GENERAL BILL.
[SECOND READING.]
Order of the Day for the Second Reading read.
THE EARL OF CREWE: My Lords, this is a second Bill for the creation of a new office. I observe that the noble Earl, Lord Camperdown, is not in the House, or I should be afraid of incurring some further censure from him in respect of the subject-matter of this Bill. I cannot help feeling that it may even be that the contemplation of it has been too much for him, and he has felt it necessary to withdraw from the House in consequence. On the general question which was raised by the noble Earl I should like to say this. We must all agree that the multiplication of offices ought to be carefully watched, but I think each case must stand on its own merits; and if it can be shown, as I think it can be
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shown, that both in the case of the Board of Agriculture and of the Post Office the volume of work is so great that it demands two regular Parliamentary representatives to conduct it in the two Houses, it seems to me that the case for each may be considered as proved. When the present Postmaster-General came into office he found that the volume of work at the Post Office was so great that it was more than he could conduct in his own person, and he therefore asked the Prime Minister for some regular assistance. He received that assistance from my noble friend the Master of the Horse, who has not only conducted the small amount of business connected with the Post Office in this House, but has also undertaken, very capably if I may be allowed to say so, a large amount of office work to an extent of which your Lordships may not be altogether aware. So far as the work of the Office is concerned, that is all quite satisfactory; but here, again, it does seem due to the ever-increasing importance of the Post Office Department to place matters on a regular footing, and in order that that may be done legislation is required. As your Lordships know, it is a regular constitutional rule that holders of salaried offices cannot sit in Parliament, and in any case where they are allowed to sit in Parliament it is only because of a Statute which explicitly permits of their doing so. Therefore, although the Postmaster-General, under the Post Office Act, can appoint such officers as he pleases and can assign salaries to them, yet it is not possible for him proprio motu to appoint officers who are able to sit in Parliament. That, my Lords, is the origin of this Bill, and I hope it will receive the same measure of support which your Lordships were good enough to give to the parallel Bill in respect of the Board of Agriculture.
Moved, That the Bill be now read 2a.—(The Earl of Crewe.)
On Question, Bill read 2a, and committed to a Committee of the Whole House on Thursday next.

TRADE BOARDS BILL.
Amendments reported (according to order).
LORD HAMILTON OF DALZELL*LORD HAMILTON OF DALZELL, having moved drafting Amendments to

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Clause 2 (Establishment of Trade Boards for trades to which Act applies), which were agreed to, proposed an Amendment to Clause 5 (Order giving obligatory effect to minimum rates of wages), subsection (4), to meet the criticism of the Marquess of Salisbury during the Committee proceedings. The general effect of the Bill was that every rate which was fixed by a Trade Board had to go to the Board of Trade for confirmation, but subsection (4) of Clause 5 enabled the Board of Trade to dispense with that process when they thought desirable. What would happen then would be that after the expiry of six months the rate would automatically come as a compulsory rate into force. The Government thought then, and still thought, that that was an extremely useful provision, but the noble Marquess regarded it as the giving of a blank cheque by the Board of Trade. The noble Marquess pointed out that though by the concluding words of the subsection the Board of Trade had power to recover the right of postponing the compulsory operation of the rate, yet they had not the right of postponing a compulsory rate in any particular case—they could only do so generally. To meet that criticism, and after consultation with the noble Marquess, it was proposed to add the following words to the subsection:—"Unless in any particular case the Board of Trade, on the application of any person interested, direct to the contrary." These words would enable the Board of Trade to postpone the compulsory operation of any particular rate if representations were made to them by anybody interested and connected with the trade that they might be injured by that rate. In that way, they thought they would have all the advantage of allowing the trade to manage its own affairs if it was capable of doing so, and, at the same time, if it should seem to be necessary, it would be possible for the Board of Trade to interfere and prevent any injustice being done.
Amendment moved—
"In Clause 5, page 4, line 27, after the word 'section,' to insert the words 'unless in any particular case the Board of Trade, on the application of any person interested, direct to the contrary.'"—(Lord Hamilton of Dalzell.)
THE MARQUESS OF SALISBURY THE MARQUESS OF SALISBURY said he was much obliged to the noble Lord for the Amendment, which was an improvement in the Bill. This subsection was a very remarkable one, and one which had
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never appeared in any Act before. It was especially remarkable because it dealt with what was avowed on all hands to be a great experiment—a great experiment in trades of a much smaller character than many with which they were acquainted in this country, and which dealt with work-people who were poor, ill-educated, of humble position, and quite unable to protect themselves; and in respect of some of these trades the Government proposed in this subsection that a general power should be given to the experimental Trade Boards to make whatever minimum rate of wages they chose without any control from the Board of Trade. That was the original proposal; the only control was that if they misused the power it could be taken away. The Amendment which Lord Hamilton had now moved did not go so far as he would have liked, but it was certainly a substantial concession.
VISCOUNT MILNER VISCOUNT MILNER said he was glad that the Government had seen their way to propose this Amendment on the suggestion of the noble Marquess. If he was not out of order, he would like to explain at this stage why no Amendment to Clause 6 stood on the Paper in his name. It would be within the recollection of their Lordships that in Committee he proposed an Amendment to Clause 6 with a view of meeting the difficulty which was certain to arise of evasion through the agency of middlemen. That Amendment met with a good deal of sympathy, and was only withdrawn on the promise of the noble Lord in charge of the Bill that the matter should have further consideration. He would like to express his obligation to the noble Lord for the courtesy he had since shown him in placing much information on this point at his disposal, and also in giving him the advantage of being able to confer with the officials of the Board of Trade on the subject. As the result of a fairly prolonged conference with those gentlemen he had come to the conclusion that, on the whole, the best course was not to try to amend the Bill on this point. Though the representatives of the Board were prepared to meet him to the extent of accepting one or two alternative forms of Amendment, they preferred the Bill as it was with its imperfections. As it would almost certainly be necessary to introduce an amending Act he had decided to wait until they could be guided by

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experience as to what provisions were required. The Bill, with its admitted incompleteness, would have a considerable effect in preventing sweating and in showing the great interest which Parliament took in the matter.
On Question, Amendment agreed to.
LORD HAMILTON OF DALZELL*LORD HAMILTON OF DALZELL moved an Amendment providing that the limitation in Clause 7 (Limited operation of minimum rate which has not been made obligatory), should apply "unless the Board of Trade direct to the contrary in any case in which they have directed the Trade Board to reconsider the rate." He said that this Amendment was designed to meet another point raised by the noble Marquess, and in which the Government recognised there was a good deal of weight.
Amendment moved—
"In Clause 7, subsection (1), page 5, line 33, after the word 'shall' to insert the words 'unless the Board of Trade direct to the contrary in any case in which they have directed the Trade Board to reconsider the rate.'"—(Lord Hamilton of Dalzell.)
THE MARQUESS OF SALISBURY THE MARQUESS OF SALISBURY said he was much obliged to the noble Lord for bringing up this Amendment.
On Question, Amendment agreed to.
Drafting Amendment agreed to.
LORD HINDLIP LORD HINDLIP, on behalf of LORD AMPTHILL, moved an Amendment in Clause 10 (Consideration by Trade Boards of complaints as to infraction of minimum rates), providing that "on the first occasion on which proceedings are contemplated by the Trade Board against an employer they shall take reasonable steps to" bring the case to the notice of the employer with a view to the settlement of the case without recourse to proceedings.
Amendment moved—
"In Clause 10, page 7, line 18, after the word 'may' to insert the words 'and on the first occasion on which proceedings are contemplated by the Trade Board against an employer they shall take reasonable steps to.'"—(Lord Hindlip.)
LORD HAMILTON OF DALZELL LORD HAMILTON OF DALZELL accepted the Amendment.
On Question, Amendment agreed to.
LORD HAMILTON OF DALZELL*LORD HAMILTON OF DALZELL explained that the object of his next Amendment was to meet another of the noble Marquess's points. Their Lordships would recollect that when the Bill was in Committee an Amendment was inserted providing for the representation of home workers on Trade Boards. The purpose of this Amendment was to provide for a similar representation on the district trade committees.
Amendment moved—
"In Clause 12, page 8, line 22, after the word 'committee' to insert the words 'and for the representation of home workers thereon in the case of any trade in which a considerable proportion of homeworkers are engaged in the district.'"—(Lord Hamilton of Dalzell.)
On Question, Amendment agreed to.
LORD HAMILTON OF DALZELL*LORD HAMILTON OF DALZELL moved the insertion of a new clause after Clause 19. When the Bill was in Committee their Lordships decided to strike out a clause giving an intercharge of powers between various Departments, and on that occasion he thought both the noble Lords who spoke in favour of that Amendment—certainly the noble Viscount, Lord St. Aldwyn—gave the House to understand that they would have been satisfied with the clause if it had contained a provision as to the transfer being done by His Majesty by Order in Council. That, he believed, had been the procedure inserted in recent legislation of this kind, and he now brought up the clause in that form and hoped their Lordships would accept it.
Amendment moved—
"After Clause 19 to insert the following new clause:
'(1) His Majesty may, by Order in Council, direct that any powers to be exercised or duties to be performed by the Board of Trade under this Act shall be exercised or performed generally, or in any special cases or class of cases, by any other Government Department, and while any such Order is in force, this Act shall apply as if, so far as is necessary to give effect to the Order, that Government Department were substituted for the Board of Trade.
(2) Any Order in Council under this section may be varied or revoked by any subsequent Order in Council.'"—(Lord Hamilton of Dalzell.)
THE MARQUESS OF SALISBURY THE MARQUESS OF SALISBURY regretted that neither the noble Viscount, Lord St. Aldwyn, nor Lord Ampthill, who moved the omission of the clause in Committee, was in his place. The Government

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now proposed to reintroduce the clause with this difference, that, instead of being done by the authority of the Government simply, this transfer of powers to another Department should only take place by Order in Council. He did not think that that contained the whole of Viscount St. Aldwyn's case. In any event it was evident that the words "by Order in Council" standing by themselves were merely a matter of form, and did not make the clause differ substantially from the one which their Lordships struck out in Committee. He did not think they would do well to agree to the clause unless further explanation was given. What kind of case were the Government contemplating? Why was it right to take powers from the Board of Trade, and to what other Department could they be given? Possibly there might be some advantage in allowing the exercise of these novel powers by the Home Office, for that Department, like the Board of Trade, commanded public confidence. But what reason could there be for transferring the powers from one Department to another? The Board of Trade was fully cognisant of these trade matters and had experienced officials accustomed to deal with points analogous to those that might arise under the operation of the Bill. He knew from experience that the Board of Trade exercised a real power in all these questions. When a power was given to the Board it was used. Let them take, for example, the power of sanctioning loans. The Board of Trade had that power and took precautions to ascertain that local authorities had a good case for borrowing before giving their sanction. He did not think other Departments exercised the same care. The Local Government Board had sinned most profoundly in that respect and had allowed local authorities to borrow recklessly. He confessed that in a similar way he had very little confidence in the Board of Education in matters of this kind. But in the Board of Trade they had confidence. He did not think the Government would be well advised in allowing the transfer of these powers to any other Department, but if they could make good a case for the Home Office the words "Secretary of State" might be substituted for "any other Government Department."
THE EARL OF CREWE: My Lords, the noble Marquess will, I think, admit that my noble friend behind me has tried to meet him and noble Lords opposite as far as possible in the course of the conduct of this Bill.
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The objection which was taken by noble Lords opposite, as we understood it, to this provision on the former occasion was in relation to the fact that there was no precedent for taking this power otherwise than by Order in Council, and my noble friend behind me thought that by securing that point he had met the objections of noble Lords opposite. The noble Marquess has made it clear that that is not entirely the case. I do not know exactly what fears the noble Marquess has in his mind. It is not, I think, likely that so competent a Department as the Board of Trade would lightly part with any of its powers under this Act to any Department which was not immediately or specially concerned. The noble Marquess, however, was undoubtedly right in assuming that the office which the Government especially had in mind in speaking of these transfers was the Home Office. The Home Office obviously have close connection in relation to the Factory Acts with matters which come within the purview of this Bill. Factory inspectors, for instance, are very likely to be employed as assistants under the power given, I think, by Clause 14 of this Bill, to bring in expert assistance in relation to these Boards. Since the noble Marquess specially desires to confine its operation to the Home Office His Majesty's Government will not stand out on the matter, but will accept the Amendment in the form which the noble Marquess suggests.
THE MARQUESS OF LANSDOWNE: I am very glad that the noble Earl sees his way to meet us on this point, because if I may venture to remind him he has not accepted the challenge of my noble friend and told the House what are the kind of cases it was intended to deal with under this clause. What we are face to face with is a proposal that very wide and far-reaching powers, which we are quite prepared to extend to the expert Department which really understands these matters, should be delegated to any other Department. I am very glad that the noble Earl has admitted that we are reasonable in deprecating that course, and I think we shall all consider that the Bill has been improved if he will allow the clause to run in the way suggested by my noble friend. I presume it would be that power should be delegated to another Secretary of State, meaning thereby the Secretary of State for the Home Department.
THE MARQUESS OP SALISBURY THE MARQUESS OP SALISBURY said

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that the Amendment as he proposed to amend it would read—
"His Majesty may, by Order in Council, direct that any powers to be exercised or duties to be performed by the Board of Trade under this Act shall be exercised or performed generally, or in any special cases or class of cases, by a Secretary of State, and while any such Order is in force, this Act shall apply as if, so far as is necessary to give effect to the Order, a Secretary of State were substituted for the Board of Trade."
Loan HAMILTON OF DALZELL Loan HAMILTON OF DALZELL then moved the Amendment in this form.
On Question, Amendment agreed to.
Drafting Amendment made.
Bill to be read 3a on Monday next, and to be printed as amended. (No. 176.)

MARINE INSURANCE (GAMBLING POLICIES) BILL.
[SECOND READING.]
Order of the Day for the Second Reading read.
LORD HAMILTON OF DALZELL: My Lords, I am almost ashamed to ask your Lordships to consider another insurance Bill before we have got rid of the one which is already on the Paper, but I make bold to do so because I believe that this is a Bill which will meet with a very general measure of acceptance. Its object is to put a stop to gambling in marine insurance policies—a practice which there is reason to believe has been carried on to a very considerable extent lately and with results which have been far from satisfactory.
I think that first of all I ought to define what a gambling policy of this kind is. Under Section 1 of the Marine Insurance Act of 1906 a contract of marine insurance is defined as a contract whereby the insurer undertakes to indemnify the insured against marine losses—that is to say, a contract of marine insurance is a contract of indemnity. Under Section 4 of the Act it is laid down that every contract of marine insurance by way of gaming or wagering is void; and in subsection (2) of that clause it is stated that any contract of marine insurance is deemed to be a wagering contract (a) where the assured has no insurable interest in the ship or cargo, and (b) where it is stipulated that no further proof than the policy shall be
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required of the existence of such an interest. The ordinary business of marine insurance is done by the owner of the vessel or by some person who has a clearly defined interest in the ship or cargo.
But besides these transactions a considerable amount of business is done in what are known as P.P.I. policies, those initials standing for the words "Policy Proof of Interest." These policies are gaming contracts within the meaning of Section 4 of the Marine Insurance Act, and, as such, claims under them cannot be enforced at law in the event of a dispute. Their position in the eye of the law is exactly the same as that of a bet in every way. But, as a matter of fact, these honour policies, as they are called, are never disputed. They are invariably paid by the underwriters when claims under them fall due, in exactly the same way as very large sums of money change hands every Monday morning—sums which are equally irrecoverable at law, and which change hands as the result of a week's racing. These P.P.I. policies are used for two purposes. One of these purposes is a perfectly legitimate one, with which we do not wish to interfere. The other is an illegitimate use, and a use which there is reason to believe has led either directly or indirectly to, or at all events has been connected with, the loss of more than one ship in recent years, and it is the latter use of these policies which this Bill is intended to stop.
I will give an instance of what I will call the legitimate use of P.P.I. policies. It often happens that a merchant wishes to effect some extra insurance on a cargo while it is in transit. A very frequent cause of this being done is where the market has risen, and where consequently the cargo is more valuable than it was when he took out the policy, and in order that his risk may be fully covered, as the easiest and the readiest and the speediest way of covering that risk, he often takes out one of these P.P.I. policies. That is a perfectly legitimate thing to do, and we have no desire to interfere with it; but, besides that, a practice has arisen of people taking out these policies purely as a speculation. Policies are taken out by people who have no interest whatever in the ship or her cargo, and there are several evils connected with that practice. In the first place, it is very often extremely detrimental to the owner of the ship, because when he wishes, in a perfectly straightforward way, to insure his interest and to

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insure himself against risk, he may find that he has been forestalled by these gamblers, and that either he cannot insure his ship at all, or has to do so at a very exorbitant premium.
Then it has been found to be most unfair to the officers of these ships, and that is a point which has been raised before in your Lordships' House by a noble Lord whose interest in these matters is well known, and who I am sorry not to see in his place to-day. It has sometimes happened that when it becomes known that a number of these policies are outstanding on any particular ship the owners think—and they have very good reason for thinking—that there is a screw loose somewhere, and in consequence more than once an owner has discharged all his officers, and sometimes the crew as well, so as to make his position safe; but, of course, the greatest evil of all which we have to deal with in this matter is that very large sums of money are to be won by the loss of the ship, and we have to bear in mind the consideration that that fact makes it probable that unscrupulous people will adopt measures to secure the loss of the ship. As I have said, there are grave reasons for believing that on more than one occasion in recent years something of that sort has been done, or, at all events, if it has not been done, the least that one can infer from reading the evidence of these cases is that certain people have been in possession of knowledge which showed that there was something wrong with the ship which was likely to cause her loss, and instead of going, as any straightforward person ought to go, with such information to the owners in order to avert possible loss of life, they have kept that information to themselves and have betted upon it, often with very large profit.
It is, of course, very difficult to get at the truth in a matter of this kind, but one cannot help being suspicious when one finds, for instance, that a relation of the master profits to the extent of £6,000 by the loss of a ship. That actually happened in one case. One's suspicions are again aroused when one finds a man insuring a ship for £1,000 at a premium of 100 guineas—a ship which was lost a short time afterwards. That transaction from a gambling point of view meant that this man accepted a bet of nine to one against the ship going to the bottom on one single voyage. That is, of
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course, a totally inadequate rate of odds unless he had very good reason indeed for supposing that it would happen. The man who had that particular speculation gave a rather interesting account to the Court of Inquiry of several other speculations of the same sort which he had had. He seems to have had five in all. One of these he lost, as the ship arrived safely in port. Another bet he lost, if I may use the expression, by a short head, for the ship went to the bottom a very little time after the policy expired. The other three he won, the ship going safely to the bottom in each case. That may have been luck or it may have been judgment, but it is extremely difficult to believe that it was all quite fair and above board.
Your Lordships must remember that in dealing with this matter we have not only to protect the interests of the underwriters, who are the victims in the first instance in these cases, but we have also to protect the owners of the ship and cargo, and, what is a great deal more important, we have to protect the lives of the officers and seamen. The Bill itself is a very short one, and I think its provisions are quite simple. There are only three, I think, with which I need trouble the House. First of all it is provided that any person taking out a gambling policy of marine insurance is liable to a penalty of £100 or to imprisonment with or without hard labour for six months, unless he has a bona fide interest in the safe arrival of the ship. The second provision is that any person in the employment of the owner of a ship who takes out such a policy will be liable to a similar punishment whether he has an insurable interest or not. But I may say, in passing, that that provision does not prevent a captain or other officer from insuring his clothes or instruments or other valuables; all that it does is to provide that he must do it in an open and above board way by means of an ordinary insurance policy. The third provision is that any underwriter who knowingly issues a policy in contravention of the Act will be liable to a similar penalty, and, as a safeguard against frivolous prosecution, it is provided that proceedings can only be taken under this Bill with the consent of the Law Officers of the Crown.
Before preparing this Bill, my right hon. friend the President of the Board of Trade consulted every interest concerned. He had conferences with the representatives of the underwriters, with repre-

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Sentatives of the shipowners, and with representatives of the merchant service officers' associations. The result of those conferences is the Bill which is now before the House, which has the approval of all those interests, which has passed through the other House without any opposition whatever, and which I now ask your Lordships to read a second time.
Moved, That the Bill be now read 2a.—(Lord Hamilton of Dalzell.)
LORD ELLENBOROUGH: My Lords, I look upon this Bill as a useful instalment of the legislation necessary to put marine insurance on a proper footing so as to put a stop, if possible, to over-insurance. To prove that this can only be an instalment I shall call attention to the case of the "Gunford," on which vessel P.P.I. policies were effected to the extent of £6,500. This vessel was valued at £9,000, yet she was insured at £19,000. The value of her freight was about £4,800; half of this had been paid in advance and so was not at risk, yet it was insured for £5,500. The total of her insurances amounted to £35,800, of which £6,500 were P.P.I. policies on the personal account of the managers, Messrs. Briggs. It is therefore clear that the managers stood to win far more than they would lose if the "Gunford" was wrecked. To command this ship they appointed a man of German origin named Sember, whose chief qualification for the appointment appears to have been that he had had his certificate suspended for the loss of the "Perthshire" twenty-two years previously, and that he had not been to sea since. With the help of a tug, Sember brought the "Gunford" as far as Dungeness. Thence he managed to get out of the Channel into the open sea, but in making the South American coast he struck on three different shoals on three different days, making a total loss of his ship on the third shoal. The crew of the "Gunford" consisted of twenty-six men, mostly Germans, ten of whom died of fever shortly after the shipwreck. Some of the underwriters refused to pay their insurances to the owners, who went to law about it. The state of the law and the customs of insurers and underwriters are shown in the judgment of Lord Salvesen in this case, as reported in The Times of July 22 last, and with the permission of
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the House I will read a short extract from that judgment. Lord Salvesen said—
"The fact was that the responsibility for over-insurance of ships rested with the underwriter, and not with the shipowner. Underwriters habitually decline to insure vessels at their market value, or, indeed, substantially below the cost price. The reasons for which they adopted this course in their own presumed interest—although it would seem to furnish a motive to the ship-owner to be less careful of the safety of the ship—were disclosed in the proof. All such policies were free of particular average under three per cent. When the three per cent. was calculated on a small sum—say £10,000 —all average above £300 had to be paid for by the underwriter, whereas if the same ship was insured on a declared value of £20,000 he escaped all claims below £600. The same principle applied in cases of constructive total loss. Underwriters had, therefore, deliberately adopted the policy of declining to insure vessels at their market value, and they preferred to run the risks of the owners being careless or dishonest, rather than have to meet claims which they would otherwise avoid, or to raise materially the annual premiums."
Lord Salvesen decided that the insurances were to be paid. Now I am not criticising Lord Salvesen's judgment. I am merely taking his words as evidence of the state of the law and of the customs of insurers and underwriters, many of whom do not appear to take into consideration the case of the merchant seamen who, as third parties, are exposed to a greater risk of shipwrecks by these transactions. In their interests I consider that the law requires further alteration and I hail this P.P.I. Bill as an instalment only. It may pay some owners to over-insure, and it may pay some underwriters to assist them in so doing; but the loss of a ship and cargo must fall on some one; and the world in general must be the poorer whenever a cargo of coal or wheat is lost through over insurance. It is said that bad cases make good law, and I hope that the "Gunford" case will eventually do so.
On Question, Bill read 2a and committed to a Committee of the Whole House on Monday next.

ASSURANCE COMPANIES BILL. [H.L.]
Read 3a (according to order), and passed, and sent to the Commons.
CROFTING PARISHES (SCOTLAND) BILL. [H.L.]
Read 3a (according to order): Privilege Amendments made: Bill passed, and sent to the Commons.

BUSINESS OF THE HOUSE.
EARL CAWDOR: Before the House adjourns, may I ask the noble Earl if he can give your Lordships any information with respect to the probable course of business in the next two or three weeks.
THE EARL OF CREWE: My Lords, we propose to take the Committee on the Housing and Town Planning Bill on Tuesday, September 21. We may safely assume, I think, that this stage will take more than one day. Whether it will occupy the whole of the rest of the week we shall be better able to judge when we have started upon it. The Irish Land Bill will, I understand, be through in another place to-morrow. I understand, however,
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that it would not meet the convenience of noble Lords from Ireland to attempt to take the Second Reading next week, and we propose, therefore, to put the Second Reading down for Tuesday, September 28, which would enable two days to be given to that stage. The Committee stage of the House Letting and Rating (Scotland) Bill will be taken on Monday, September 27, and the Report of the Housing and Town Planning Bill on Thursday, September 30. We should proceed with the Irish Land Bill in Committee on Monday, October 4, and such following days as may be necessary.
House adjourned at ten minutes before Six o'clock, to Monday next, half-past Two o'clock.