HL Deb 20 June 1938 vol 110 cc23-6

Read 3a (according to Order).

VISCOUNT GAGE moved, after Clause 10, to insert the following new clause:

Additional provisions with respect to loans by local authorities.

.—(1) Where in pursuance of Section two of the principal Act a local authority give assistance by way of loan to the owner of a dwelling, then, subject to the provisions of this section and to such conditions as may be approved by the Department the loan may, in lieu of being secured by a bond and disposition in security or other deed of security, be secured by an order (in this section referred to as a "charging order") made by the local authority providing and declaring the dwelling, or the dwelling and such other subjects belonging to the owner of the dwelling as the local authority and such owner may agree, to be charged and burdened with an annuity to repay the amount of the loan.

(2) The annuity charged shall commence from the date of the order, and shall be a sum of such amount and shall be payable to the local authority or their assignees for such period of years, not exceeding twenty, as the local authority and the owner may agree.

(3) A local authority shall not make a charging order, and a charging order shall not be effectual, unless—

  1. (a) the local authority have served on every person appearing in the Register of Sasines as the proprietor of, or as holding a heritable security over, the subjects or any part thereof to be charged and burdened with the said annuity, notice that if no objection is intimated to them in writing by such person within twenty-one days from the date of service of the notice, they intend to make such charging order; and
  2. (b) no objection has been so intimated by any person on whom notice has been so served.

(4) The provisions of Section twenty-two of the Housing (Scotland) Act, 1925, shall apply to a charging order made under this section in like manner as they apply to a charging order made under Section twenty-one of the said Act, subject to the following and any other necessary modifications—

  1. (a) subsection (2) shall apply as if after the words "advances of public money" there were inserted the words—
  2. "(d) any rent charge secured on the premises by absolute order made under and in terms of the Improvement of Land Act, 1864;
  3. (e) any loan made for agricultural purposes in pursuance of the Agricultural Credits (Scotland) Act, 1929, by any company incorporated for the purposes of that Act, where such loan has been secured on the premises by a bond and disposition in security or other deed of 24 security duly registered in the appropriate Register of Sasines; and
  4. (f) any charge on the premises created under any provision in any Act authorising a charge for recovery of expenses incurred by a local authority under Section one hundred and twenty-five of the Public Health (Scotland) Act, 1897, or by a local authority or an owner under Section twenty of the Housing (Scotland) Act, 1925, or Section fifteen of the Housing (Scotland) Act, 1930";
(b) Subsection (3) shall not apply.

(5) For the purpose of this section a notice may be served by delivering it to the person on whom it is required to be served or by sending it by registered letter to such person at his usual or last known address, or if such person cannot be found, to the Extractor of the Court of Session. An acknowledgment endorsed on such notice or a copy thereof, by such person, or where the notice is sent by, registered letter, a certificate subscribed by the clerk to the local authority that such notice was duly posted and having the Post Office receipt for the registered letter attached shall be conclusive evidence that such notice was duly served on the date stated in the acknowledgment or Post Office receipt.

(6) In this section the expression "owner" has the like meaning as in Section forty-nine of the Housing (Scotland) Act, 1930.

(7) This section shall extend to Scotland only.

The noble Viscount said: My Lords, I apologise to your Lordships as an Englishman for moving an Amendment which applies to Scotland, but my noble friend Lord Strathcona is engaged on War Office business and I must try to explain this new clause. It applies to Scotland only, and has been drafted to meet a point raised by the noble Lord, Lord Saltoun, and the noble Marquess, Lord Aberdeen, on another Bill. Representations in favour of the new clause have also been made, I understand, by the Scottish Land and Property Federation, the Scottish Chamber of Agriculture and the Association of County Councils in Scotland. The general object of the clause is to encourage local authorities to make more use of their power to make loans for the improvement of rural cottages. It does this by enabling authorities to make charging orders which will have priority over other loans. Before they make a charging order, however, they must give notification to all persons who have already made loans on the property, and if any of these persons object the charging order may not be made. Certain charges such as feu duties are exempted from the prior ranking of the clause.

Your Lordships will see that subsection (1) Provides that these authorities may, instead of taking a bond, make a charging order providing that the property is charged with the annuity that I have just described. Subsection (2) provides that the local authority and the borrower may agree on the amount and the period of the annuity, but it may not exceed twenty years, which is the period during which the general conditions of grant under the main Acts apply. Subsection (3) prevents the local authority from making this charging order unless they have given these notices to which I have referred and unless none of those persons has objected. Subsection (4) applies the provisions of Section 22 of the Housing (Scotland) Act, 1925, to charging orders made under this new clause. That is to give the priority to which I have already referred.

With certain exceptions the priority given by this Bill cannot take precedence over certain loans. They are set out in Section 22, and the subsection also adds three types of charge which must be excepted from the lists of loans over which this section gives priority. Those charges are charges in respect of loans made by the Land Improvement Company, charges in respect of loans made by the Scottish Agricultural Securities Corporation, and charges imposed by a charging order made under Section 22 of the Housing (Scotland) Act, 1925, or under Clause 11 of the Housing (Agricultural Population) (Scotland) Bill. The other subsections are, I hope, quite clear. I hope, and think, that noble Lords from Scotland are satisfied with this new clause, and I beg to move.

Amendment moved— After Clause 10, insert the said new clause.—(Viscount Gage.)


My Lords, I sympathise with the noble Viscount in charge of the Bill in trying to understand a clause which applies to Scotland only. This clause, as now submitted, is a great improvement on the new clause moved on my behalf by Lord Saltoun on the Committee stage, and I have pleasure in saving that the agreements reached at the conference held on May 26 representing all the parties referred to in this new clause have been more than amply fulfilled in the clause. On behalf of my noble friends who supported the clause which I moved on the Housing (Agricultural Population) (Scotland) Bill, I have to thank the Government for putting the clause into this Bill also. The conference in Edinburgh strongly supported its application to the Housing (Rural Workers) Amendment Bill, in addition to being made available for the new houses.

I should like to take this opportunity of thanking, through the noble Lord in charge of the Bill, the Secretary of State for Scotland, and also the Solicitor-General for Scotland, who took a great deal of interest in this conference and has done the legal side of it in a way which pleases everybody concerned. The new clause is going to be of enormous help to us in Scotland in getting more houses improved than would otherwise be possible under the very severe financial strain put upon owners of property who desire to improve the houses which they already possess but have no money to spend without resorting to loans. I beg to thank the Government very heartily.

On Question, Amendment agreed to.

Bill passed, and returned to the Commons.