LEASEHOLD PROPERTY (TEMPORARY PROVISIONS) BILL

HL Deb 05 June 1951 vol 171 cc1007-49

2.43 p.m.

Amendments reported (according to Order).

Clause 2:

Provision where tenant holding over after expiry of long tenancy.

2.—(1) Where a tenancy was granted for a term of years certain, being a term exceeding twenty-one years and expiring on a date (hereinafter referred to as "the date of continuation") before the commencement of this Act, and— (a) immediately before the date of continuation or in the case of a tenancy expiring on or after the twentieth day of November, nineteen hundred and fifty, at all times during the period beginning with that date and ending with the date of continuation the tenant or a member of his family was residing in a dwelling-house comprised in the property in right of the tenancy, and the next following subsection shall have effect.

LORD TOVEY moved, in subsection (1) after the first word "continuation" to insert "after the 21st day of November, 1950, but." The noble and gallant Lord said: My Lords, you may remember that I moved certain Amendments when this Bill was being dealt with in Committee, but withdrew them at the suggestion of the noble and learned Viscount the Lord Chancellor, who kindly consented to give consideration to the points involved. As the result of subsequent discussion between our respective advisers, the Amendments which I wish to see made to the Bill have been reduced to those which now appear under my name and which I still consider represent points of major importance to persons like myself who have to administer property on behalf of others.

As I stated previously, I am advised that the retrospective effect of the Bill in its present form is unlimited. To my mind, there are two excellent reasons why this unlimited retrospective effect is wrong. First, I consider it true to say that it has always been the practice of good landlords to treat their tenants with consideration and patience, and to allow them to remain in possession after the expiration of their tenancies, while either alternative accommodation is being found, or terms for a new tenancy are being negotiated. The normal landlord has always been reluctant to resort to legal action where hardship to the tenant might result. The noble and learned Viscount the Lord Chancellor said that he is inclined to believe that the longer a man has held over with the landlord's con-sent, the greater is his merit to continue to do so. My own experience and that of my office—which has extended over a very much longer period than mine—is to the contrary, for it has shown almost invariably that the man who has not accepted reasonable terms within a reasonable time is the difficult and un-reasonable tenant. Further, it is note-worthy that in the vast majority of these cases, though the tenant holds over with the landlord's consent, that consent is not really free, but is induced by consideration for tenant. Once again, there-fore, I make the point that in my belief the longer a tenant has held over, the greater will have been the consideration shown by the landlord, and, therefore, so much the more is the landlord deserving of protection by the Bill.

My second point is that consideration by the landlord has been extended without any idea in the minds of the parties that the showing or receiving of that consideration would affect the legal rights of either of them. The effect of the Bill, however, is to substitute, after a particular date, rigid legal rights and duties for the more elastic condition of give and take. For this reason also, therefore, I consider it is fair to both sides to limit the retrospective effect of the Bill. In my submission the logical and proper date in this connection is that date when the parties could first have become aware that their respective legal rights were most likely to be affected by the granting and acceptance of further consideration— namely, the date of publication of this Bill. I beg to move.

Amendment moved— Page 2, line 3, at end insert ("after the 21st day of November, 1950, but ").—(Lord Tovey.)

2.48 p.m.

THE LORD CHANCELLOR

My Lords, I must confess that I heard very imperfectly the noble Lord who has just spoken. This was through no fault of his, but was, obviously owing to some defect in the amplifying arrangements which seems to be very prevalent to-day. If I do not answer anything which the noble and gallant Lord said, I hope he will attribute it not to malice aforethought on my part but to lack of hearing. This is the same sort of discussion that we had during the Committee stage. It is to be observed that the noble Lord in this Amendment is not objecting root and branch to the extension of the Bill to those persons who are, to use the technical phrase, "holding over." I could understand an Amendment objecting to that altogether, so that the Bill would apply only to long leases coming to an end after the Bill had come into force as an Act of Parliament. But, whilst accepting the principle that the protection of the Bill should extend to some people who are holding over, the noble Lord limits the class of "holders over" whom the Bill should protect. I must say that I find the suggestion he makes an odd one. If I may, I will take two cases. Consider, first, the case of the man who, at the present time, has been holding over for three months, and com-pare him with the man who has been holding over for three years. I cannot see why we should confer upon a man who has been holding over for three months, a benefit which we deny to the man who has been holding over for three years. If I had to choose between the two, I should have thought the man to whom we ought to extend the concession was the man who had been holding over for three years.

After all, what does it mean? It means that by tacit consent, and no doubt for perfectly good reasons—because I should be the first to admit that, as a general rule, landlords are very human—the landlord has allowed this state of affairs to go on for years and has not taken the steps open to him to get rid of his tenant. Now this bill comes along, providing that all those who have been holding over shall have protection. What we desire to do is to preserve the status quo as it exists at the time when the Bill comes into operation. Even since the introduction of the Bill on November 20 last there would have been plenty of time for a landlord, if he had been vigilant and determined, to assert his rights to get the tenant out. I indicated my view to the noble Lord in our discussion on Committee stage, and I remain entirely unconvinced by what he said. I entirely fail to see any justice in saying that we will protect a man who has been holding over since November 21, but that we will not protect the man who has been holding over for a long time, who has been allowed to hold over for the landlord for a long time, and in his case come to the landlord's aid. I should have thought that that was the worse case of the two. Once we accept the principle of protecting some people holding over, as we do, I should have thought there was no case for saying that we would protect only those people holding over from November 21. Therefore, although I have given much consideration to this matter and although, as the noble Lord told the House in one of the passages which I did hear, thanks to the discussions between his representatives and mine we have been able to reduce substantially the number of Amendments in dispute between us, I regret that I cannot see any ground on which I should be justified in accepting this Amendment.

VISCOUNT SIMON

My Lords, fortunately I am so situated in the House that I heard both the noble and gallant Lord, Lord Tovey, and the noble and learned Viscount the Lord Chancellor, perhaps because I am halfway between them. While I appreciate the argument which the noble and learned Viscount the Lord Chancellor has put forward, I think he has put it a little too high. I should have thought that there was something to be said in favour of the view expressed by the noble and gallant Lord. Lord Tovey. So far as I can judge the matter, I think it is a mistake to regard this Amendment as though it sought to turn the worse into the better reason. Is not the true position this? Clause 2 of the Bill is inevitably retrospective in a certain sense. It confers the benefit of the Bill upon tenants who, until the Bill is passed, have no legitimate status as tenants. That may or may not be right. But as the clause now stands, not only is it retrospective but it goes as far as ever we imagine it can go, without any limit. The noble and learned Viscount the Lord Chancellor has contrasted the case of the tenant whose lease expired three months ago with the case of the tenant whose lease expired three years ago, in each case the tenant, by some means or other, still finding himself in occupation of the premises. I am not prepared to say that in every case the greater merit attaches to the one than to the other.

I must point out, as did Lord Tovey in a passage which the noble and learned Viscount the Lord Chancellor could not hear, that there are cases in which it is due to the indulgence and consideration of the landlord that the individual finds himself still living in premises in which he has no legal right to live. The kind-hearted landlord may be prepared to see him in that position for a long time. The harsher landlord—and, of course, both kinds of landlord exist in the world—may be anxious to reduce to the minimum the period during which the tenant occupies without any title. In that sense, Clause 2 as it stands is calculated both to penalise the indulgent landlord and to reward the persistent trespasser. If I followed it aright, that was the argument which the noble and gallant Lord put forward. It may be that that cannot be helped. It may be that, Clause 2 having been in principle accepted, it is not possible to draw the line. But, with great respect, merely acting as an interpreter between two members of your Lordships' House, one of whom could not hear everything said by the other, I feel that the argument put forward by the noble Lord, Lord Tovey, deserves a certain consideration. I agree that once we accept Clause 2 it may be difficult to modify it; but for my part I am influenced by the argument that we do not want, if we can avoid so doing, to pass retrospective legislation which rewards the persistent trespasser and penalises the indulgent landlord.

On Question, Amendment negatived.

Clause 5:

Restrictions on enforcement of covenants

5.—(1) While a tenancy continues by virtue of section one or section two of this Act, or while before the date of expiry the tenant under a tenancy granted for such a term as is mentioned in the said section one, or a member of the tenant's family, is residing in a dwelling-house comprised in the property or part thereof in right of the tenancy, then— (a) the landlord shall not be entitled, by action or otherwise, to enforce any right of forfeiture or re-entry in respect of any failure to comply with a term or condition of the tenancy, or to bring any action against the tenant for damages in respect of such a failure; and

Provided that nothing in paragraph (a) of this subsection shall affect forfeiture or re-entry for non-payment of rent or rates or for failure to comply with any obligation to insure or keep insured, and that nothing in paragraph (a) or (b) of this subsection shall apply to the enforcement of any right or the bringing of any action on the ground that the property or part thereof is being, or has since the commencement of this Act been, used for illegal or immoral purposes.

THE PAYMASTER - GENERAL (LORD MACDONALD OF GWAENYSGOR)

My Lords, this is a drafting Amendment consequential on Amendments inserted during the Committee stage. I beg to move.

Amendment moved— Page 4, line 19, leave out ("or part thereof").—(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

2.59 p.m.

LORD LLEWELLIN moved, in sub-section (1), to omit all words in paragraph (a) from the first "the" down to the final word "and," and to insert: Leasehold Property (Repairs) Act, 1938, shall, irrespective of the rateable value of the property comprised in the tenancy, apply to the tenancy as it applies to a lease of which five years or more of the term remain unexpired; The noble Lord said: My Lords, I make no apology to the House for once more putting this Amendment on the Order Paper, because, with the best will in the world, the noble Lord, Lord Macdonald of Gwaenysgor, gave me rather an un-satisfactory reply on the Committee stage. In not pressing the Amendment at that stage, I warned your Lordships that I might return to the charge again. The principle behind this Bill is to preserve the status quo until the time when the Government, after further inquiry, have decided what should be the permanent legislation to deal with leasehold property of the sort with which this Bill is concerned. That is just what the words which I am moving to delete do not achieve: they do not preserve the status quo, but alter it, and do so in particular by removing from the leaseholder the obligation which he has at the present time to keep the house in good repair. If this Bill should become an Act in its present form, for a period of two years the tenant will not be under that obligation. We shall be assenting to a large number of houses going into a state of disrepair and becoming slum property. Once that obligation is removed from the tenants for the period of two years it is unlikely that many of them will repair their properties.

It may be said against me that under Clause 6, which was inserted in another place, the landlord, at any rate, in the case of damage to the structure, has the right to go in and repair the building himself, although under the terms of the lease it is the obligation of the tenant. With nobody yet sure what is to happen to these properties in the end, it is, to say the least, doubtful how many land-lords will do that; because it will be noted that if they do go in under Clause 6 they have to bear the costs, and can recover them from the tenants only after the expiry of the two years. Nobody quite knows what will be the position of the tenant when the obligation becomes due, or where he may be by that time. As a result, I believe that, if we pass the Bill in its present form, a great deal of the house property covered by the Bill will deteriorate into slums. No doubt many of your Lordships have experience of the rapidity of deterioration with property of which repairs are neglected. Nor will it eventually be a good thing for the tenant if we pass the Bill in its present form. The Bill does not relieve him for ever, but only for a period of two years, of his obligation to repair. Therefore, if no repairs are carried out during the period of two years, the deterioration of the building may be such that when— as may happen—the landlord is once again allowed to call on the tenant to do repairs the tenant will have a much greater bill to pay

This Amendment proposes to leave out the words which change the obligation for this status quo period, but which nevertheless change the obligations between the landlord and tenant. The second part of the Amendment is intended to ensure that a landlord cannot easily eject a tenant who does not live up to his obligation to repair. The words I am seeking to use are not mine. As I explained on the Committee stage of the Bill, in 1938 certain speculative people were buying freeholds and serving big schedules of dilapidations upon the leaseholders. The Government of that day determined that they would not have people ejected willy-nilly by these speculators who bought up the freeholds, and in the case of any properties which had a rateable value of less than £100, or of which the lease had more than five years to run, the matter could be brought before the court. The procedure was simple. When the landlord started his proceedings, the tenant had merely to give notice asking that the provisions of the Leasehold Property (Repairs) Act, 1938, should be applied. If both parts of my Amendment are accepted it will mean that no person who has a notice of dilapidations served on him by his land-lord can be turned out, except when the matter has been taken before the court.

I seek by this Amendment to make the Leasehold Property (Repairs) Act, 1938, apply to property, whatever its value, and to a lease, however short the unexpired term. The noble Lord, Lord Macdonald, in replying to me on the Committee stage, said: However, I do not think that the Government can accept the granting of protection under the 1938 Act as a means of making this a better Bill. I agree that the 1938 Act was necessary. I do not mind giving credit to the Government of that day for one good Act, but I cannot believe it is seriously suggested that that Act, introduced almost as an emergency Act, is the right type of measure necessary to make this a better Bill and to achieve the purposes of this Bill. I do not know what reason the noble Lord had for saying that that Act was introduced almost as an emergency Act, and denying the fact that this Bill is almost an emergency Bill. This is, on the Government's own showing, a temporary measure, and we might well say that it has been introduced in an emergency to cover the time until some permanent legislation is produced before us. The noble Lord went on to say: After all, this Bill has a specific purpose, which has been referred to many times to-day and during the debate on Second Reading. Its purpose is to prolong for two years leases which are due to run out. I agree with that statement, but the purpose of the Bill is evidently not to preserve these leases in their existing form: it is to make a different kind of lease. In some cases, if nothing is done about some of these houses, at the end of the two years, it may well be that there will be nothing left upon which to have a lease, because nobody will be repairing them. The noble Lord went on: It is suggested that now a new Bill has been introduced, and though the landlords were considerate as regards repairs before the Bill was introduced, they cannot be expected to be so considerate in the future. The noble Lord then posed this question: Why should that be so? Why should this Bill alter the attitude of the landlord to the tenant or lessee? I understand that landlords do not like this Bill. I should be surprised if they did. At the same time, I can hardly believe that because this Bill which they do not like has been introduced, they will take full advantage of their position. In that case why not continue the existing obligations between landlord and tenant and continue the obligation to repair?

The noble Lord, Lord Macdonald, then said that my Amendment would cut right across the purpose of the Bill. It is not intended to do that; nor do I believe that it would do so. If the purpose of this Bill is to allow slums to be created, then my Amendment will cut across the purpose of this Bill. If the purpose of this Bill is to continue the status quo until the Government make up their mind on the permanent legislation—which is what I understand is its purpose—then my Amendment does not cut across that at all: it preserves the status quo; it still leaves on somebody's shoulders the definite obligation to repair, and it prevents an unscrupulous landlord, except by leave of the court, from turning out a man who is in default of his covenants. In my view, my Amendment has all the merits and I have no hesitation in asking your Lordships to agree with it to-day. I beg to move.

Amendment moved— Page 4, line 21, leave out from ("the") to ("and") in line 25 and insert (" Leasehold Property (Repairs) Act, 1938. shall, irrespective of the rateable value of the property comprised in the tenancy, apply to the tenancy as it applies to a lease of which five years or more of the term remain unexpired; ").—(Lord Llewellin.)

VISCOUNT BUCKMASTER

My Lords, I should like briefly to support my noble friend who has moved this Amendment. If this Bill purports to be a standstill measure, there can be no just reason for not making the standstill operative in regard to the covenants, as well as to the leases. I can see no cause for relieving the tenant of the repairing covenants in the lease, which are an essential part of a contract into which he has entered, often after skilled legal advice and full consideration. Not only do I believe it to be unsound to take such a course but, as my noble friend has said, I believe it to be contrary to the public interest, in that it tends to allow the progressive deterioration of property. Although, under Clause 6, the landlord has certain rights in regard to executing repairs "reasonably required for preventing or arresting any serious deterioration," it is often the minor repairs which, though small in themselves, if not dealt with become large, starting the process of decay and deterioration which it is the purpose of my noble friend to prevent.

There is one other aspect of this matter which I should like to put to the noble and learned Viscount, not knowing whether he is able, or, indeed, whether any of your Lordships is able, to hear me in the some-what distorted conditions which prevail. In fact, there is no need to interfere with the covenants written in the lease, be-cause the position of the tenant is already adequately protected under existing law. As I ventured to point out to your Lordships in Committee, the Landlord and Tenant Act, 1927, gives substantial protection to the tenant, limiting the damages which can be recovered to those repairs necessary to prevent any worsening of the reversion; and that, after all, is the real test in these matters. There is also the Courts (Emergency Powers) Act, 1943, which I understand can be invoked in cases of hardship. Therefore, we start with the position in which, if I am right, there is no need for any action of any kind. But if action has to be taken—if we are going to interfere with the repairing covenants in the leases—then I suggest that it is essential that we should accept the Amendment so ably moved by my noble friend.

LORD SALTOUN

My Lords, the nation-wide menace of dry rot reinforces my noble friend's argument.

VISCOUNT MAUGHAM

My Lords, I confess that when I first read Clause 5, I thought it had been inserted by error, because it seemed to me so exceedingly unjust. I have not yet heard any justification for it. The argument which my noble friend Lord Llewellin has put before the House at any rate requires an answer, and so far I have heard nothing to suggest that his argument is wrong.

THE LORD CHANCELLOR

My Lords, the noble Lord, Lord Llewellin, has moved his Amendment in a very fair way, and has put before your Lordships the relevant considerations. Under the scheme of this Bill, which is a purely temporary measure, we are proposing to extend these long leases for two years. I thought everybody agreed that there was a case for doing that. If I am right in my recollection, this Bill, on Second Reading, both in another place and here, was not the subject of a Division. There is obviously a real problem here, and I do not think that at the present time anybody can realise the right way in which to deal with it. Moreover, if, as a result of this two years' extension, we are going to sow a crop of lawsuits which come to harvest during those two years, then we shall have done a great deal of harm. I do not want the two years' extension proposed by this Bill to be conditional upon the result of a lawsuit, just because every landlord who objects to this Bill and resents the two years' extension has pointed out to him a means by which he can fight the extension if it is likely to get in his way.

I said the other day, on the Committee stage, that if we were realistic on this matter we should know that, when these long leases fall in, as often as not there is ground for saying that there has been a breach of repairing covenant. Of course, under the 1938 Act different conditions arose. When that Act was passed, it was intended to deal with this sort of consideration: a speculator would buy a long lease which had a substantial period, perhaps twenty or thirty years, to run; and it would have suited him very well if he could bring about the termination of that lease, for he would then be able to say to the tenant, "There has been a breach of repairing covenant, and in consequence I can get rid of you, for the lease has come to an end; you have broken your covenant and I can get possession of the property." It was to prevent that sort of thing that the Act was passed. It applied only to those cases which still had leases with at least five years to run; and it had to be shown, in order to get permission from the county court judge to enforce the repair covenant and end the tenancy, that there was substantial damage to the reversion. And if the lease still has five years run it by no means follows that a breach of the repairing covenant at that stage involves a substantial damage to reversion.

We are dealing with the case where a lease has come to an end, or is about to come to an end, and where, by the nature of the case, there can be no question of there being another five years to run. It is almost certain that every breach of a repairing covenant will involve damage to the reversion. I do not know how to define the word "substantial"; but something other than de minimus must be involved. So that if we were to pass this Amendment, dealing with these cases where the lease is coming to an end or is about to end, every breach of a repairing covenant would involve a substantial damage to the reversion. Therefore, in cases which come before the county court—which of course would not act in an arbitrary way—if the court comes to the conclusion that there is substantial damage, then it would give a right to enforce the provisions of the lease.

What would be the result? We should create a crop of litigation, and the extension which you are giving on paper by this lease would turn out to be wholly illusory. I am sure that that state of things would be much worse than the first. No one would know where he stood. People would find themselves in a situation which they could not foresee and would make bargains adverse to their own interests. We have thought this matter over very carefully and have come to the conclusion that if we are going to interfere in this short, sharp and summary way—I admit that—and grant an extension of two years, we must not make the extension illusory and dependent upon circumstances such as the strict observance of a repair covenant.

Therefore, if your Lordships desire to insert this Amendment in this Bill, then it must be done on your own decision. I cannot concede this particular point, because if we do make the Amendment. I believe, as I say, that the extension will be illusory and we shall be bringing about a large number of lawsuits to determine whether or not there shall be the extension of two years. The whole scheme of this Bill was necessarily against that. We said that during this two years there was to be no forfeiture for breach of a repair covenant. We gave the landlord the right to do the repairs himself during those two years, but even so we said that he was not to have repayments for doing this work during these two years, but thereafter. It was on that basis that we framed this Bill. If we were to accept this Amendment it seems to us that, so far from being clear and certain, it would not make the matter dependent in each case on the question whether there had been a risk of damage to reversion; and where the lease is almost at an end any damage must involve substantial damage to reversion. It is for those reasons that I regret I am unable to accept this Amendment.

VISCOUNT MAUGHAM

My Lords, are we not telling the tenants who are to have the advantage of this Bill that they need not repair and need not pay any rent at all? Will it not be an inducement to the less honest tenants?

THE LORD CHANCELLOR

Of course they must pay the rent during the period of the extension, and we do not intend to relieve them of the burden of repairs when the two years is up. I agree that if this were to be more than a two years' measure there would be great force in what the noble Lord, Lord Llewellin, has said, but in a two years' measure I do not think there is any real danger.

VISCOUNT MAUGHAM

Is there a provision under the Bill that rent must be paid?

LORD LLEWELLIN

Yes, the proviso on line 30 on page 4.

3.30 p.m.

VISCOUNT SIMON

My Lords, it is a misfortune of the discussions on this Bill that those who have a criticism to make —and it appeared to me that the noble Lord, Lord Llewellin, put his criticism both forcibly and moderately—are met by speeches from the noble and learned Viscount, the Lord Chancellor, which we all admire, but in which, as it seems to me, we are invited to consider quite a different aspect of the case. Perhaps it is because the Bill itself is so complicated and its language is difficult to follow. I intervene only for a moment to ask the House to consider, rather in the spirit in which my noble and learned friend, Lord Maugham, has just put his question, what it is that we are really doing.

By this Bill, we are saying that, though a man has a lease of over twenty-one years which is shortly expiring or has expired, and though, therefore, one would suppose that when that comes to an end the reversion would begin, we are going to add to his term a further period which, for convenience, we will call two years, though it will not be quite that in many cases. We are not going to compel him to take it for two years; we give him the chance to take it if he likes; therefore he will take it only if it suits him. Whether or not it suits the landlord does not matter. In the second place, we are going to say: "Not only that, but the rent you shall pay during these next two years shall not be the rent which corresponds with the value of the property. The rent you shall pay for the next two years shall be the rent which was thought proper when (it may be ninety-nine years ago) the building lease was drawn up and the rent was a matter of a few pounds." First, we are going to give him the option of having an extra two years; secondly, we are going to say: "What is more, you shall have it really cheap."

Now comes the third question. The lease contains covenants by which the property is to be kept in repair. One of the conditions is that it is the tenant who shall do the repairs. But, according to this Bill, as commended to us by the Lord Chancellor, we are to confer upon the tenant a third advantage. Not only is he to have the extra two years, not only is he to have the extra two years, as it may be, on a trumpery rent, but he is to be excused from this time from making any repairs at all—and that is what the Lord Chancellor calls a "standstill measure."

SEVERAL NOBLE LORDS: Hear, hear!

LORD LLEWELLIN

My Lords, having moved the Amendment, I believe I am entitled to wind up the discussion on it. Therefore, I rise just to say that I am not satisfied with the answer given by the noble and learned Viscount on the Woolsack, although it was delightfully given. First of all, as I understood his argument, he said that it would probably give rise to a crop of lawsuits. If that were to be the case why has it not happened in regard to these tenancies before? If it were going to give rise to a crop of lawsuits, if the owners of the freeholds were so active in demanding every avail-able interest, why were they not quick, as soon as they saw this Bill, to go to court and turn the tenants out before the Bill became an Act of Parliament?—the point raised by the Amendment moved by the noble and gallant Lord, Lord Tovey. Even the noble and learned Viscount the Lord Chancellor said that they had had the time to do so if they had been vigilant and had so desired. So I do not think that that is going to occur.

The second point I think the noble and learned Viscount made was that the Bill would be illusory if we left in the obligation to repair—illusory in that it would not give people the two years' extension. Then would it not also be illusory because they can still be turned out if they do not pay their rent? Is this measure illusory if they can still be turned out if they do not insure? Is it illusory because they can still be turned out if they use the premises for immoral purposes?— because those provisions are all in the Bill at the present time. We should look at this matter, not from the point of view of the individual landlord or the individual tenant, and not of whether the tenant shall go on paying his rent, but of whether a substantial asset to the community, a decent house in these days of shortage of houses, is kept in repair or not. That ought to be of bigger interest to all of us than are those instances on which, as the Bill at present stands, the tenant can be turned out if he is default. One thing we ought to be anxious to see kept in being is every kind of incentive, whether for landlords or leaseholders or anyone else upon whom the obligation falls, to keep in a proper state of repair such houses as we have in this country at this time of housing shortage. I ask your Lordships to assent with me in the Amendment I am moving.

3.36 p.m.

THE MARQUESS OF SALISBURY

My Lords, I should like to make one more appeal to the Government on this point. I feel sure that, having listened to the case of the Opposition this afternoon, they will see that we are not actuated by unworthy motives. We are not seeking unfair advantages for the landlord, but we are trying to make this Bill do what the Government say it is intended to do—that is, to ensure a complete stand-still for two years while the Government have time to consider the framing of permanent legislation. As the noble and learned Viscount, Lord Simon, has pointed out, it appears that it may be a standstill on one side—that is to say, with regard to the rights of the tenants—but it is not a standstill with regard to their obligations. I listened to the noble and learned Viscount the Lord Chancellor, who spoke with his usual skill and charm, but it seemed to me that he did not speak with his usual conviction. I do not think that conviction is on the side of the Government in this case because, after all, his argument, which was rather an odd one in the mouth of a great legal luminary, was that, even though there have been, of course, great irregularities with regard to this matter, the only way out of the situation was to legalise them. If that were the basis of British law, we should soon find ourselves in a very queer position indeed.

The position is simple. The landlord lets a house on a ground lease, at a certain rent and on certain conditions. It is a contract, like any other contract. If, when the lease was originally negotiated, the obligations on the landlord to do repairs had been greater than they were, then the rent charged would have been higher. It is a perfectly simple position. In fact, it was because of the obligations which were imposed upon the tenant that the rent, even at that time, was as low as it actually was, and now it is sought to alter it. The Lord Chancellor has said: "After all the Government are doing quite a lot for the land-lord: they are giving him the right to re-enter to do the repairs for himself if he likes." I do not call that very much of a right. What they are giving him is the right to expend money and do work which somebody else is under a contract to do. It is not only that the landlord himself may wish to re-enter; he may be forced to. The local authority might say—indeed, they probably would say— "this property has got into a scandalous condition. Work must be done upon it." That property has got into that scandalous condition because the tenant has not done what he ought to have done under his contract. Yet, as I understand it, after the Bill has been passed the obligation to repair, the order of the local authority, will fall on the landlord and not on the tenant. To call that a "stand-still" is, I think, a grave abuse of the word. My Lords, I feel quite genuinely that this is a big issue. Even though only two years are involved, it raises considerable points of principle, and I beg the Government to give the matter at any rate further consideration before the Third Reading.

LORD SILKIN

My Lords, I agree with the noble Marquess that this is an important Amendment, but he has done less than justice to the fundamental purpose of the Bill, of which we must not lose sight—namely, to give tenants whose leases are about to expire a real security of tenure for a period of up to two years. The period may, in fact, be only a few months, but at the maximum it will be two years. The objection to the Amendment is that, if it were carried there would be a great danger that many tenants would not be given security. There would be a great temptation to landlords to invoke the process of law, and not merely because they were fearful of their property so deteriorating in these few months as to become slums—in fact, I regard that as most unlikely. I think it is highly exaggerating the position to imagine that, in this short period, property which the land-lord had hitherto been content not to press the. tenant to repair would become so bad that it would endanger his reversion. The real fear that many of us on this side of the House have is that this provision would be invoked by unscrupulous landlords for the purpose of intimidating tenants into surrendering their tenancy.

LORD LLEWELLIN

May I ask the noble Lord whether he thinks that surrender would be enforced by an unscrupulous court?

LORD SILKIN

No, not enforced by an unscrupulous court; but the purport of the Amendment is such that a court would be almost obliged, if it were literally interpreting the Amendment, to give the landlord either possession of the premises or damages.

LORD LLEWELLIN

Perhaps damages, but a court need not grant an order for ejection.

LORD SILKIN

I think the noble and learned Viscount on the Woolsack is right. If Section 5 of the 1938 Act is invoked the landlord has to establish that there is specific damage to his reversion: and with this short period of tenure still unexpired that is the easiest thing in the world to establish, especially if he has allowed the premises to get into some form of disrepair and it can be argued that it is rapidly becoming a slum. Of course the landlord can establish every time that there is damage to his reversion, and therefore every time there is the probability that the landlord will succeed. Therefore, I say that by inserting this Amendment we should be depriving the tenant of something which this Bill is intended to give him—namely, security of tenure.

Having said that, I want to respond to the noble Marquess by agreeing that there may be extreme cases where a tenant might deliberately, out of spite or for any other reason, permit damage, or even do wilful damage, to the premises. I agree that that case ought to be met, and I suggest to the noble and learned Viscount on the Woolsack that it may well be that between now and the next stage some-thing ought to be considered which would give the landlord protection against serious damage, particularly wilful damage, but which, on the other hand, would not enable him to start what might be regarded as frivolous action for the purpose of intimidating tenants, many of whom may be ignorant people, afraid of the law and even more of the expense involved in going to law. If one could devise something which would prevent this sort of intimidation and at the same time in proper cases would protect the land-lord, I feel that that would be justified. As a practising solicitor of many years' standing, I think I can say that in all these cases, whenever it is established that there has been some breach of covenant, and where the court would give relief, they give it on terms that the tenant has to pay not only his own costs but those of his landlord. That has become a very serious factor in the whole matter, often far outweighing the importance of the amount of damage concerned. Many tenants cannot afford to pay those costs, and they might be prepared to surrender their premises rather than involve them-selves in litigation the costs of which they are not in a position to meet. Therefore, from that point of view the security which this Bill seeks to give them would be in danger. I hope that the noble Lord, Lord Llewellin will feel that my words are a gesture which recognises that he has a point of view, though I believe that he is going much too far and, in many cases, inflicting unnecessary hardship on the tenant, in an endeavour to meet what may in some cases be a genuine grievance.

VISCOUNT SWINTON

My Lords, the noble Lord who has just spoken of course speaks with great experience, both professional and ministerial, in regard to this business, and he has made an appeal to the Government to try and find a sort of via media. Obviously, he and I think many others on the Government Benches who have followed this matter with know-ledge are not happy with the Bill as it stands. Certainly the noble Lord, Lord Silkin, was not at all happy. He felt that there was a case to be met here to do justice as between a reasonable landlord and a reasonable tenant. As I under-stand it, Lord Silkin said: "I do not like this Amendment because it might take away from the tenant something that we seek to give him by this Bill." Is not what you seek to give the tenant by this temporary Bill, the enjoyment for another two years of that which he has enjoyed hitherto? So long as a man has a lease which is going to run on for more than two years, you do not interfere at all. You do not interfere because you are satisfied that the contractual relationship established between the landlord and tenant is a reasonable one which you do not wish to vary. Then surely the position is that we wish to continue that relationship as nearly as possible for two years—and that is, of course, a pure advantage to the tenant.

But, if the Bill stands as it is, are we not being very unfair as between the tenant who has no right at all until he is given the right to an extra two years under this Bill, and the tenant who has a contractual right still running? In the case of a long lease tenancy existing to-day, a landlord can, if he is so disposed, enforce at any time against his tenant the contractual obligations under the lease. He is qualified in that right by the Act of 1938 which was deliberately passed because it was feared that in certain circumstances landlords might avail them-selves of the legal right when it was not wholly reasonable that they should do so. The case in those exceptional instances— I call them exceptional—was that conditions might arise in which it would become to the landlord's advantage to get rid of the tenant. He would then bring an action against the tenant, seeking to compel him to carry out his repairing covenant. The landlord would do that because he had a good offer for a new lease, whereas, in the ordinary course, as between landlord and tenant under a long lease, he would not have troubled to en- force the covenant. That was the position. The 1938 Act, as I understand it, was passed in order to meet that exceptional case.

Now, I ask this question. Why, when you are giving this two years' extension to all tenants, should the risk be greater than it has been during the currency of the lease? Why should every landlord suddenly, so to speak, go mad and wish to get rid of his tenant? I really think that that sort of argument, apart from its not being based on the experience of the years since the 1938 Act was brought into operation, also assumes that people try to evade the law. As a matter of fact, although we have quite a number of rather stupid laws passed in these days, on the whole the people of this country are quite extraordinarily law-abiding. This Bill, if we can get it drafted in the right form, will go through by common consent. A Bill goes through by common consent only because people on all sides feel that, on the whole, what it is designed to accomplish is reason-able. When that is the case, I am certain a vast problem will not arise, owing to landlords trying to get rid of their tenants once the Bill has been passed. We shall not fine, things of that sort happening provided the landlord and the tenant are satisfied that what has been passed by Parliament gives a fair deal to both sides. But if an impression is created that the dice are weighted un-fairly on one side, it might be that efforts would be made to take advantage of the situation.

I suggest that Lord Llewellin's Amendment is, on the whole, reasonable, and that it meets all the points that the noble Lord, Lord Silkin, has raised. Unless the Government are prepared with some compromise which is generally acceptable, I should have thought that the reasonable course would be to adopt this Amendment now, and for noble Lords on all sides of the House to consider between now and the Third Reading, whether there is any modification which it would be reasonable to graft upon this proposal and which would be fair to the reasonable tenant and also to the reason-able landlord. Certainly, as I see it, coming quite impartially to this discussion today, unless some Amendment of this kind is put in, the Bill as a whole will be unfair to the landlord and—what to me is much more important—will be likely to lead to still further degradation of property. A great deal can happen to property in two years. If the noble Lord, Lord Silkin, will look back over his own experience when he was a Minister and when, owing to restriction of rents, repairs were not economical and were not carried out, I think he will agree. Is it not a fact not only that in two years but that in one year quite a lot of property has fallen into disrepair, even if it has not actually become a slum? What happens to it? Because this sort of dégringolade of property goes on. As we all know, a stitch in time saves nine.

Resolved in the affirmative, and Amendment agreed to accordingly.

4.8 p.m.

LORD TOVEY moved, in the proviso to subsection (1), to leave out (where first mentioned) "paragraph (a) of." The noble Lord said: My Lords, I knew that I was ill-equipped to enter the legal lists, but I never thought that one of my deficiencies was that I could not make my voice carry half the length of a cruiser's quarterdeck. The object of this Amendment is to safeguard the rights of the

The right time to do repairs is when they are needed. If one or two years are allowed to elapse it may be that the property will not have become a complete slum, but to prevent its becoming a slum will need an expenditure perhaps three times as great as a reasonable piece of renovation or repair would have cost if it had been carried out at the right time. I must say that on the merits of the position, I think the reasonable course is to do what Lord Llewellin suggests.

On Question, Whether the Amendment be agreed to?

Their Lordships divided: Contents, 53; Not-Contents, 29.

CONTENTS
Cholmondeley, M.	Hutchinson, V. (E. Donoughmore.)	Hampton, L.
Exeter, M.		Hardinge of Penshurst, L.
Salisbury, M.	Maugham, V.	Hawke, L.
Willingdon, M.	Mersey, V.	Llewellin, L.
	Monsell, V.	Luke, L.
Beatty, E.	Portman, V.	Mancroft, L.
Dundonald, E.	Simon, V.	Merthyr, L.
Fortescue, E. [Teller.]	Swinton, V.	Milverton, L.
Haddington, E.	Templewood, V.	Moyne, L.
Halifax, E.		O'Hagan, L.
Lindsay, E.	Balfour of Burleigh, L.	Palmer, L.
Munster, E.	Balfour of Inchrye, L.	Remnant, L.
Onslow, E.	Carrington, L. [Teller.]	Rochdale, L.
Rothes, E.	Cherwell, L.	Saltoun, L.
	Derwent, L.	Sandhurst, L.
Bridgeman, V.	Dorchester, L.	Sandys, L.
Buckmaster, V.	Dowding, L.	Teynham, L.
Falmouth, V.	Gifford, L.	Tovey, L.
Furness, V.	Hacking, L.	Tweedsmuir, L.

NOT-CONTENTS
Jowitt, V. (L. Chancellor.)	Burden, L. [Teller.]	Kershaw, L.
	Calverley, L.	Lawson, L.
Baldwin of Bewdley, E.	Chorley, L.	Lucas of Chilworth, L.
	Crook, L.	Macdonald of Gwaenysgor, L.
Alexander of Hillsborough, V.	Douglas of Barloch, L.	Marley, L.
St. Davids, V.	Douglas of Kirtleside, L.	Morrison, L.
Stansgate, V.	Faringdon, L.	Ogmore, L.
	Haden-Guest, L. [Teller.]	Pakenham, L.
Ammon, L.	Hare. L. (E. Listowel.)	Rochester, L.
Amwell, L.	Holden, L.	Silkin, L.
Bingham, L. (E. Lucan.)	Hungarton, L.

superior landlord as against the mesne tenant. This is of particular importance where it is desired to determine a mesne tenancy on the ground of the immoral use by a sub-tenant of the premises. It is desired to make it clear that nothing in the Bill affects the right of the superior landlord in this respect. I am advised that the Bill as drafted appears to leave this position in some doubt, though I understand that the noble and learned Viscount the Lord Chancellor may be prepared to give an assurance that the terms of the Bill as it stands do not affect the rights of the superior landlord. If that is so, I shall be glad to withdraw my Amendment. I beg to move.

Amendment moved— Page 4, line 29, leave out (" paragraph (a) of").—(Lord Tovey.)

THE LORD CHANCELLOR

My Lords, this Amendment would have startling results and would largely defeat the object of the Bill. May I give your Lordships a simple illustration to show how it would work? Let us assume that there are three people. A, a landlord; B. a tenant, and C, a person to whom the premises have been sub-let. The premises have been let by A to B for 99 years and by B to C for the rest of the term, minus ten days. If B commits a breach of covenant entitling A to forfeit his lease, I hat forfeiture will not adversely affect C, for the structure of the Bill is that there is created a direct relationship of landlord and tenant as between C and A. But if the Amendment were accepted, C would not be protected against the forfeiture of B's lease. If, for example, B had failed to pay his rent or to insure, why should C thus become penalised for B's default?

The proposition which I maintain is the fair one is this: that there is no reason why C. the sub-tenant in occupation, should be prejudiced by the fact that B, his immediate landlord, has breached his contract with A, always provided that C himself is not in breach and you can bring about a direct relationship between C and A. If that were not so, I would further point this out. AH you have got to do to intrigue C out of the property would be to bring about an arrangement between A and B whereby B commits some forfeiture, perhaps by not paying rent, and A. the landlord, could then get out C, and no doubt consider some suitable division of the spoils with B. I feel sure the noble Lord will see that this Amendment is really a far-reaching one and would destroy one of the purposes of the Bill which I believe all Parties desire.

LORD TOVEY

My Lords, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

LORD TOVEY moved, in the proviso to subsection (1) to leave out all words after "ground," and to insert: of the use of the property or part thereof for illegal or immoral purposes, unless (in the case of a past such use) there has since been a. change in the ownership of the tenancy". The noble Lord said: My Lords, the object of this Amendment is to ensure that the landlord's right to forfeit a lease on the ground of illegal or immoral user of the premises shall be preserved where such a breach of covenant or agreement has occurred, whether before or after the passing of the Act. It will be noted that the words chosen are framed to protect the innocent occupier who has taken an assignment of the tenancy. It is submitted that the right of the landlord to proceed against an occupier who has himself been guilty of illegal or immoral conduct, or of permitting the same, upon the premises, should not be affected, as it inevitably will be if the Bill is passed in its present form, by the fact that the misdoing took place before June 24, 1951. If, however, the words of the Amendment are adopted, the landlord will be able to take the action which he obviously should take against the individual wrongdoer, whenever the wrongful act is committed. The innocent occupier who has taken an assignment of the tenancy will none the less remain fully protected. I beg to move.

Amendment moved— Page 4, line 34, leave out from ("ground") to the end of line 36 and insert the said new words.—(Lord Tovey.)

THE LORD CHANCELLOR

My Lords, I am grateful to the noble Lord for putting down this Amendment. The last thing we desire to do is to give any help or encouragement to those who are using their property for purposes of this sort, and therefore I accept the Amend-ment.

On Question, Amendment agreed to.

THE LORD CHANCELLOR moved, after subsection (2) to insert: () Where the landlord is prevented by paragraph (a) of subsection (1) of this section from bringing an action for damages in respect of anything done by the tenant in breach of a term or condition of the tenancy, a county court as well as the High Court shall have jurisdiction to grant an injunction to restrain the doing of that thing.

The noble and learned Viscount said; My Lords, your Lordships will remember that on Committee stage we had some discussion on this point, and there was a question as to whether the power of the courts to grant an injunction did or did not survive. The noble and learned Viscounts, Lord Simon and Lord Maugham, both raised a query on the point. I confess that I thought the power to grant an injunction did survive, but I am certainly not going to pretend that the matter can be plain if two former Lord Chancellors express doubt upon it. Therefore, obviously the sensible thing to do is to make the matter quite plain by inserting words in the Bill. I think that at the time of the discussion we did not sufficiently distinguish between the High Court and the county court. Although I still think that the right of the High Court to grant injunctions would be unimpaired, yet the right of the county courts to grant an injunction is merely ancillary to other relief, and other relief cannot now be given. Without this provision it would not have been open to the county court to grant an injunction. However, since we are putting it right for the county court, we should make it plain for the High Court, and I hope that the Amendment I have put down will meet my undertaking and satisfy your Lordships. I beg to move.

Amendment moved— Page 4, line 43, at end insert the said sub-section.—(The Lord Chancellor.)

VISCOUNT MAUGHAM

My Lords, I am obliged to my noble and learned friend on the Woolsack, and I am quite content with the course he has taken in the matter.

On Question, Amendment agreed to.

Clause 6 [Power of landlord to carry out essential repairs]:

LORD MACDONALD OF GWAENYSGOR

My Lords, this is a drafting Amendment, again consequential on Amendments which we accepted in Committee to Clauses 1 and 2. I beg to move.

Amendment moved— Page 5, line 37, leave out from beginning to the second ("in") and insert ("residing in a dwelling-house comprised in the property"). —(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

Clause 7 [Provision where long tenancy determined and subtenant, etc., in occupation]:

LORD MACDONALD OF GWAENYSGOR

My Lords, this is a drafting Amendment for the same reason. I beg to move.

Amendment moved— Page 6, line 27, leave out from ("is") to ("by") and insert (" residing in a dwelling-house comprised in the property").—(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

LORD MACDONALD OF GWAENYSGOR

My Lords, this and the next two Amendments are also consequential upon Amendments accepted in Committee to Clauses 1 and 2. I beg to I move.

Amendment moved— Page 7, line 7, leave out from (" was ") to ("by"), and insert (" residing in a dwelling-house comprised in the property").—(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

Amendment moved— Page 7, line 11, leave out from ("was") to ("some") in line 12, and insert ("residing in the dwelling-house ").—(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

Amendment moved— Page 7, line 19, leave out (" property or the part thereof ") and insert ("dwelling-house") —(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

Clause 10:

Renewal of tenancies of shops

10.—(1) The provisions of this Part of this Act shall have effect for enabling the occupier of a shop under a tenancy to which this section applies (hereinafter referred to as "the expiring tenancy") to apply to the court for, and subject to the provisions of this Act to obtain, the grant of a new tenancy where apart from the next following section the expiring tenancy would come to an end within the period of two years beginning with the commencement of this Act. and would so come to an end by effluxion of time or by the expiration of a notice to quit given by the landlord, whether before or after the commencement of this Act.

4.19 p.m.

LORD MACDONALD OF GWAENYSGOR moved, in subsection (1) to omit "within 'the period of two years beginning with the commencement of this Act," and to insert: immediately before the date of the commencement of this Act or within the period of two years beginning with that date. The noble Lord said: My Lords, this Amendment follows from an Amendment put forward by the noble and learned Viscount Lord Simon. The House will remember that he suggested a specific date, June 24. It is discovered that a yearly tenancy from Midsummer to Mid-summer, if terminated by notice to quit, comes to an end at the last moment of June 23. As the Lord Chancellor pointed out during the debate on the Committee stage, there is obviously no justification for depriving tenants under such tenancies of the benefits of Part II of the Bill. I may be asked why no corresponding Amendment is required in Part I. The answer is twofold. First of all, Part I deals only with tenancy for a term of years certain, and a tenancy granted for a term of years from the Midsummer quarter day expires at midnight on the night of June 24/25 and not, as in the case of a yearly tenancy, twenty-four hours earlier. Secondly, it is immaterial whether a tenancy expires immediately after commencement and is continued by Clause 1, or immediately before commencement and is revived and continued by Clause 2. I beg to move.

Amendment moved— Page 9, line 9, leave out from ("end") to ("and") in line 10, and insert the said new words.—(Lord Macdonald of Gwaenysgor.)

VISCOUNT SIMON

My Lords, I am obliged to the noble Lord opposite, and I have learnt a little law from him which I did not previously know. I had a suspicion that we had to be careful about Midsummer Day, and that is why I suggested that there should be a fixed date at which the Bill should begin. I spoke about June 25, but that was not correct. At the same time I can see that the suspicion I had in mind had some justification. The noble Lord opposite—I almost called him the noble and learned Lord opposite—has drawn a very subtle distinction, which I have no doubt is justified by the law of landlord and tenant. I am grateful that the matter is now being put exactly right.

On Question, Amendment agreed to.

Clause 11:

Time for, and interim effect of, application for new tenancy:

(4) The relevant date for the purposes of the last foregoing subsection, in relation to an application,—

1. (a) unless the application is withdrawn, is the date falling one month after the date on which the court finally determines under the next following section either to order 1034 or not to order the grant of a new tenancy on that application;
2. (b) if the application is withdrawn, is the date falling one month after the withdrawal of the application.

THE LORD CHANCELLOR moved, in subsection (4) (a), to delete all words after the fourth "the" ["the court"] and insert: proceedings on the application (including any proceedings on or in consequence of an appeal) are finally determined.

The noble and learned Viscount said: My Lords, this Amendment arises as a result of the Amendment which we accepted in Committee to allow appeals under Part II with the consent of the county court. Under the Bill as drawn, the case may not come on in the county court until after the tenancy has expired, and the effect of Clause 11 (3) is that if the tenant makes an application in court and does not withdraw it, the tenancy continues until one month after the county court's decision, if it would, in the natural course of events, have come to an end meanwhile.

In the same way, where leave is given to appeal to the Court of Appeal, the tenant must clearly be allowed to continue in occupation until that court should dispose of the case, whether the appeal is against the refusal of a new tenancy or against the grant of a new tenancy or against terms fixed for a new tenancy, by the county court. These Amendments secure this by providing that the old tenancy shall be continued until the Court of Appeal has finally decided the case. During the interim period, the tenancy is to continue on its existing terms and conditions unless—and I attach great importance to this—the county court judge, in giving leave to appeal, otherwise directs.

In equity, supposing the final decision results in a new tenancy and in new terms, whether in confirmation of or modification of the county court decision, then no doubt that final decision ought to apply as if the county court had reached it in the first instance and there had been no appeal. But this leads to a number of difficulties about retrospective applications. Suppose for example, the Court of Appeal decides that no new tenancy should be granted. Is it then to fix a new rent to be applied retrospectively just for the interim period? Suppose the tenant, having entered in the county court an appeal against a new tenancy, subse- quently withdraws it: must the case then go to the Court of Appeal to fix the rent he ought to have paid for the few weeks between the end of his old tenancy and the withdrawal of his notice of appeal? One way of avoiding these difficulties would be to provide simply that the old tenancy should continue on its existing terms until the case is decided finally.

As explained above, the effect of Clause 11 (3) is to give the tenant a short extension on the existing terms, pending the hearing of his initial application. It might be said that it is only logical that whether he or his landlord appeals against the decision on that application, the same principle should be applied. But in most cases this involves giving the tenant a bonus, for there are likely to be few cases where the rent, if the new tenancy is granted, will be lower than the rent he has hitherto paid. The amount of money involved is likely to be small; the appeal may take some weeks to settle and there may be a few cases which have to go back to the county court. On balance, it seems best to provide that as a general rule the tenancy shall continue on its existing terms and conditions, but to give to the county court the discretion to alter them where it thinks fit. There may be cases where the county court is extremely doubtful about giving the right of appeal. There may be cases were tenants are tempted to appeal, although with slender chances, simply for the sake of getting a few weeks more at the existing rent. The present position will enable the court to deal with such cases where this might inflict hardship or injustice. I beg to move.

Amendment moved— Page 11, line 4, leave out from the second ("the") to end of line 7, and insert the said new words.—(The Lord Chancellor.)

On Question, Amendment agreed to.

Clause 12 [Power of court to grant new tenancies of shops]:

LORD MACDONALD OF GWAENYSGOR

My Lords, this Amendment is consequential upon the previous Amendment. I beg to move.

Amendment moved— Page 11, line 24, leave out from ("the") to the end of line 26 and insert ("end of the expiring tenancy (whether it ends in accordance with the terms thereof or after being continued by subsection (3) of the last fore- going section)").—(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

Clause 14 [Provisions as to Landlord and Tenant Act, 1927]:

LORD MACDONALD OF GWAENYSGOR moved in subsection (5), to leave out all words after "Notwithstanding anything in this Part of this Act" and to insert: the following provisions shall have effect, as respects claims by the tenant for compensation under Part I of the said Act of 1927 and notices by the landlord under paragraph (d) of subsection (1) of section two of that Act or paragraph (b) of the proviso to subsection (1) of section four thereof (which paragraphs exclude compensation where within the specified period of two months the landlord serves on the tenant such a notice for the renewal of the tenancy as is therein mentioned):—

1. (a) no application shall be made under this Part of this Act for the grant of a new tenancy if the tenant has duly claimed such compensation as aforesaid and the landlord has within the said period of two months served such a notice as aforesaid;
2. (b) where an application is made under this Part of this Act at a time when the tenant has duly claimed such compensation and when the landlord has not served such a notice as aforesaid but the said period of two months has not expired, the application shall not be heard until that period has expired, and if within that period the landlord serves such a notice the application shall be dismissed;
3. (c) where at the time such an application is made the tenant has not duly claimed such compensation but the time for claiming it has not expired, the application shall not be heard before the expiration of that time, and if before the expiration thereof the tenant duly makes a claim the last foregoing paragraph shall apply as it applies where the application under this Part of this Act is made after the making of a claim for com- pensation."

The noble Lord said: My Lords, this is rather a lengthy Amendment but it is a necessary one to get over a very real difficulty. It deals with the machinery in Part II of the Bill for making its pro-visions fit into those of the Landlord and Tenant Act, 1927. Under Sections 2 and 4 of that Act the tenant may, within a specified time and subject to specified conditions, claim compensation for improvements or goodwill. The claim for compensation is defeated if, within two months from its being made, the land-lord gives notice to the tenant that he is willing and able to grant, or obtain the grant of, a renewal at such rent and for such term as, failing agreement, the tri- bunal under the 1927 Act may consider reasonable. In the case of a tenancy coming to an end by notice to quit, the time within which the tenant may claim compensation under Section 2 or Section 4 of the 1927 Act is one month from the service of the notice to quit. Thus it will not be known for certain whether the landlord offers a renewal until three months from the service of the notice to quit.

Under Clause 11 (1) of the Bill, the time within which an application for a new tenancy may be made under the Bill, in the case of a tenancy ending by notice to quit, is also one month after the giving of the notice to quit. Thus, the application under the Bill will have to be made, in the notice-to-quit case, before the end of the period within which the landlord can make his counter offer under the 1927 Act. Indeed, the tenant may make his application under the Bill before he even claims under the 1927 Act. The purpose of Clause 14 (5) of the Bill is to prevent renewals under the Bill where the land-lord has offered renewal under the 1927 Act; but the subsection was inaccurately drafted, since it provided that no application under the Bill should be made if the landlord had offered renewal under the 1927 Act.

In moving this Amendment, I feel that I ought to say that it followed a suggestion made by an adviser to the noble and learned Viscount, Lord Simon, and the noble Lord, Lord Llewellin, at a meeting with the Lord Chancellor and myself a few days ago. I think I ought to give credit that it is from that source that this Amendment emanated. I beg to move.

Amendment moved— Page 13, line 18, leave out from ("Act") to end of line 26, and insert the said new words. —(Lord Macdonald of Gwaenysgor.)

VISCOUNT SIMON

My Lords, I am grateful for the concluding words of the noble Lord opposite. I think he made it clear—and in any case I should wish to make it doubly clear—that whatever credit attaches to pointing out this gap is due not really to myself or to anybody with me in your Lordships' House, but to a professional gentleman who kindly attended and himself indicated what was not then clear to me, that something of this sort had to be done. What has been done has just been admirably explained by the noble Lord, Lord Macdonald, and I am well content with the result. I wish to give honour where honour is due.

On Question, Amendment agreed to.

4.31 p.m.

Clause 15 [Appeals]:

LORD MACDONALD OF GWAENYSGOR

My Lords, this Amendment is consequential. I beg to move.

Amendment moved—

Page 13, line 39, at end insert— ("(2) Notwithstanding anything in subsection (3) of section eleven of this Act. the court granting leave to appeal may direct that during the period beginning with the granting of leave to appeal and ending with the date to which a tenancy is continued by the said subsection (3) the tenancy shall have effect subject to such modifications, terms or conditions as that court may specify.")—(Lord Macdonald of Gwaenysgor.)

On Question Amendment agreed to.

Clause 20:

Interpretation

"retail trade or business" has the same meaning as in the Shops Act, 1950, except that it does not include the sale of intoxicating liquor for consumption on the premises, or the sale of meals or refreshments in premises which are licensed for the sale of intoxicating liquor for consumption on the premises;

"shop" means premises occupied wholly for business purposes, and so occupied wholly or mainly for the purposes of a retail trade or business;

LORD GIFFORD moved to add to the definition of "retail trade or business": so however that this exception shall not have effect where either—

1. (a) the excise licence for the time being in force in respect of the premises is a licence the duty in respect of which is the reduced duty payable under section forty-five of the Finance (1909-10) Act, 1910, or a licence granted in pursuance of regulations under subsection (5) of the said section forty-five (which relates to the granting of licences on the provisional payment of reduced duty), or
2. (b)the Commissioners of Customs and Excise certify that no application under the said section forty-five has been made in respect of the period for which the excise licence for the time being in force was granted, but that if such an application had been made such a licence could properly have been granted as is mentioned in the last foregoing paragraph."

The noble Lord said: My Lords, Clause 20 as drafted sets out certain definitions including that of "retail trade or business." As the Bill is at present drafted, an unlicensed restaurant where no alcoholic drinks are supplied is included in the provisions of the Bill, but a licensed restaurant is not. It has been felt that this is rather anomalous, and the purpose of this Amendment is to include licensed restaurants. There have been discussions about this clause since the Committee stage, and I am given to understand that the words proposed in my Amendment are acceptable. I beg to move.

Amendment moved— Page 15, line 25, at end insert the said words. —(Lord Gifford.)

LORD MACDONALD OF GWAENYSGOR

My Lords, the Government are sympathetic to this Amendment, but they do not want to disturb some noble Lords opposite who may have different views. If the point is to be covered, the Amendment needs to be very carefully drafted, and we consider that the Amendment moved by the noble Lord, Lord Gifford, is so drafted. The Amendment must be drawn so as to include what the man in the street would call "a licensed restaurant" and exclude what he would call a "pub"; and we feel that this Amendment achieves that purpose. We are therefore prepared to accept it.

LORD LLEWELLIN

My Lords, as I understand this Amendment, it means that restaurants will be inside or outside the scope of the Bill, according to the ratio of their takings on alcohol as against their takings on meals. If my interpretation is correct, I should like to ask if it is based on what happened last year. The proportions in some premises may go up this year while those in others may go the other way, and they would be then outside the scope of the Bill. This may well happen, and I believe it to be a very real point.

THE LORD CHANCELLOR

My Lords, I understand that the relevant year is the year before the current year. But I will consider carefully what the noble Lord has said, and if further elucidation is needed I will communicate with him.

LORD LLEWELLIN

I am obliged to the noble and learned Viscount. The point I wish to make is whether a year hence will be another "current year."

On Question, Amendment agreed to.

VISCOUNT SIMON moved, to add to the definition of "shop": or for the reception of goods to be washed, cleaned or repaired. The noble and learned Viscount said: My Lords, this is a small Amendment which I was asked to put forward for consideration. The boundaries within which the benefits conferred by the second part of this Bill may be obtained are not easy to draw, and the suggestion in my Amendment is that benefits should be enjoyed by a certain class. It is not, of course, a proposal to bring laundries within the scope of the Bill. Laundries are factories, and ought not to be within the scope of a Bill dealing with anything in the nature of a shop. What is referred to are premises where goods for dry cleaning, or for similar treatment, are collected and paid for over the counter: they are collecting points which are found in many shopping centres. It was a body called The Institution of British Launderers who brought this matter to my attention. They urged that these collect-ing points, which are usually one of a row of shops, where the goods are handed in and collected and the money taken over the counter, but which are not used for the purpose of selling goods, should come within the scope of the Bill. I myself have no very strong views on the subject, but it seemed to me that the case which the Institution made was one that I should be justified in bringing to your Lordships' notice, and I do so without making any long speech about it.

Amendment moved— Page 15, line 32, at end insert the said words.—(Viscount Simon.)

THE LORD CHANCELLOR

My Lords, this is an interesting point. Your Lordships will see that the definition of a shop is: premises occupied wholly for business purposes, and so occupied wholly or mainly for the purposes of a retail trade or business; If you look at the definition of a "retail trade or business" you will find that it has the same meaning as in the Shops Act, 1950, except that it does not include the sale of intoxicating liquor for consumption on the premises …. Now, the Shops Act includes in its definition of a "retail trade or business" the business of a "barber or hairdresser" although, apart from things sold over the counter, there is no "retail trade or business"—buying goods from or selling goods to others. It includes: … the sale of refreshments or intoxicating liquors, the business of lending books or periodicals when carried on for purposes of gain but does not include: the sale of programmes and catalogues and other similar sales at theatres and places of amusement. It seemed to us that the best line to take on this question of shops was to confine it as nearly as we could to the definition in the Shops Act. After all, we were asked to extend this very widely. All sorts of offices wanted to come in, and it was difficult to resist. But we did resist it—and we had the support of the Opposition in resisting it.

If you are going to include these words you are going on a slippery slope. Take, for instance, a garage: that might well come into this description. It is a place where goods are not bought or sold, but you leave goods to be dealt with by washing or cleaning. What about the optician's shop? You go in there and he has a shop. He does not sell you a thing so much as measure your eye or try the refraction, and so on. To take a simple illustration, there is the case of a dentist. There, you do not buy things, but the dentist operates on you. Logically, T agree that since the Shops Act includes the barber who operates on your hair it is difficult to see why you should not include the dentist who operates on your teeth—but that is the principle upon which we have gone. We have adhered to the Shops Act with, I think, the solitary exception that we have not dealt with premises for the sale of intoxicating liquor. Although I agree that any definition you care to take is illogical, yet I say that I should be alarmed at extending it in the way suggested by including the words: goods to be washed, cleaned or repaired. That is not a retail trading, in the ordinary sense of the buying and selling of goods. Such a place is not one of the premises protected by the Shops Act, and it would seem to me that, if we are going to apply any logic, it would open the door very widely to all sorts of other places. For instance, why should you not include the "shop," in the ordinary sense, where you buy theatre tickets? That is not in- cluded, and, since that is not in, I do not see why this should be. On the whole, we think that we had better keep this Bill within fairly narrow limits, the limits I have suggested being those of the Shops Act. For that reason, I do not think it desirable to accept this Amendment.

VISCOUNT SIMON

My Lords, I do not feel that I can resist that argument, be-; cause there is much force in the observation that, if we make this insertion, a number of other cases more or less analogous may inquire why they should be left out. I hope that I may be forgiven for raising the point; I do not wish to spend longer on it I beg leave to with-draw my Amendment.

Amendment, by leave, withdrawn.

LORD TOVEY moved, after subsection (1) to insert: () No person shall for the purposes of this Act be deemed to be a member of the family of any tenant or other person except the wife or husband or a parent or child (as defined by section 5 of the Fatal Accidents Act, 1846, and extended by section 2 of the Law Reform (Miscellaneous Provisions) Act, 1934) of the tenant or other person or any other relative wholly or mainly maintained by him and any reference in this Act to a member of the family of any tenant or other person shall be construed accordingly.

The noble and gallant Lord said: My Lords, it appears that no attempt has been made in the Bill to define the meaning of the expression "a member of the tenant's family." I can readily appreciate that it is not easy to find a suitable definition, but, being a very ordinary man, that seems to me a very good reason for doing something to try to help the unfortunate landlord and tenant by giving them some guidance. In default, as I understand, the only way of getting a decision will be to waste a great deal of time and effort on going to law and getting decisions on one case after another. As the noble Lord, Lord Silkin, so charmingly admitted just now, that is liable to become very expensive. I am advised that the definition I am putting forward is one which would substantially cover the class of persons intended to benefit by the Act. However, I admit at once that this is a matter of legal expression and interpretation which I obviously cannot pursue. I have moved this Amendment to invite attention to what appeared to me a most important deficiency in the Bill, and my Amendment I believe and hope to be a constructive suggestion as to how the difficulty may be met. I beg to move.

Amendment moved— Page 15, line 40, at end insert said subsection. —(Lord Tovey.)

VISCOUNT BUCKMASTER

My Lords, I have much pleasure in supporting my noble and gallant friend in this Amendment. As the noble and learned Viscount is aware, there exists in the Rent Restrictions Acts no definition of the word "family," with the result that there has been a most unfortunate crop of cases causing costs to all the parties involved. Nor is it possible, as the result of those cases, even now to state with confidence and precision what is meant by this word. The cases have extended the law to cover a nephew or niece by marriage. Such decisions can give rise to grave abuse—I do not suggest that they often do but they can. A niece by marriage can be imported to secure the tenancy and carry it on. Furthermore, we have now reached a position in which the children of a good lady whom we euphemistically call "an unmarried wife" are included.

I would put this point to the noble and learned Viscount that the Rent Restrictions Acts were passed with the object of establishing the position on the death of the tenant. The intention was to see that when, for instance, the father of the family died, the daughter should not be turned out in the street. This Bill, how-ever, goes further. The question of death does not arise. A member of the family secures the tenancy, whether the tenant is dead or alive. Furthermore, under the Rent Restrictions Acts, the word "family" is used but once or twice. Here, it is freely used and is a vital and integral part of the Bill. Indeed, it was found that, when subsequent legislation to the Rent Restrictions Acts was passed—the Landlord and Tenant (Requisitioned Land) Act, 1942—a definition was necessary, and the definition then chosen was the one adopted by the noble and gallant Lord in the Amendment which he has put forward this afternoon. While I agree that a precise definition of this word is not easy to give, and while it may indeed be possible that the noble and learned Viscount will harden his heart against this Amendment, I hope that he will feel that this is really a non-controversial point, not designed to secure an advantage for one side or the other, but designed purely to save expense and costly litigation to both parties and to prevent the possibility of abuse. Therefore, I urge the noble and learned Viscount, even if he rejects this particular Amendment, not altogether to harden his heart but to see whether some other appropriate form of words may be discovered to bridge this unfortunate gulf.

THE LORD CHANCELLOR

My Lords, I do not in the least complain about this Amendment. Whether or not we should try to define what we mean here is a very real question. Of course, definition has the obvious advantage that people know where they are and the judge knows exactly where he is. There is that to be said for it. On the other hand, absence of definition gives a greater latitude and, therefore, greater room for discretion. I agree that when-ever there is discretion we may fairly say that there is a risk of an indiscretion— there is that argument against it. It therefore really comes to me, of necessity, to see whether I can devise some satisfactory form of definition. This is not a new question. It has been considered for a long time and no one has yet been able to devise a satisfactory form of words. This definition comes, if I remember aright, from the Landlord and Tenant (Requisitioned Land) Act, 1942 —an Act which gave a tenant of requisitioned land a right in certain cases to disclaim. So far as I know—I do not speak with authority about this matter —that definition has never been the subject of judicial decision. I do not think it has. In the Rent Restrictions Acts, on the other hand, it is notorious that this matter has not been defined. Consequently, the judges have had to pronounce upon it. and gradually a jurisprudence has been built up which I think is a good deal more satisfactory than this definition.

Let us just take an illustration of this definition. I know that it is easy to pick holes in other people's definitions and the difficulty is to find one which is satisfactory. Take the definition which the noble Lord has borrowed from that Act, and consider a case like this. Suppose you have a couple of brothers living together, each with a small income and each contributing towards running the place. One of the brothers is of course the tenant, and the other has for years been living with him in those premises. Then the tenant brother dies or, if you like, goes away. Why should not the other brother, who may have been there for twenty years, be allowed to continue? Even under this definition that would not be allowed, unless he could come in under the description, "any other relative wholly or mainly maintained by him". In the case I have put, where the two brothers stand exactly on a fifty-fifty basis, neither one richer than the other, that would not be allowed, and both noble Lords would be among the first to say that that would be a monstrous interpretation, and obviously they do not intend that. Yet that would be the result of this rigid definition.

Alternatively, take a case that has been decided in the courts, where it was held that a young lady was a member of the family. A husband and wife were living together in a flat. Both were getting rather old. The wife had a niece who came to live with them and acted rather as a daughter would act, making herself useful in looking after the old people in every sort of way. The wife died and this middle-aged woman, as she had then become, continued to live there with the old man, looking after him. She had lived with those two people for a very long time in that way. Then the old man died. The courts held that that woman, who was, if I may so term it, a kind of de facto daughter, although she was no blood relation of the old man, was a member of the family. In fact, it seems to me that the reason why it is so difficult to define who is a member of the family is that so often it depends on the circumstances of the case rather than on the actual blood relationship. If I had adopted somebody who had been living with me for years just as though she were my daughter, I should find it much less difficult to say that that woman was a member of the family than perhaps I would of a brother who had been in Australia and had recently come to live with me as a lodger, paying a rent. I think you can put too much emphasis on blood relationship and not enough emphasis on what I may call the de facto position, the length of time for which the relationship between the parties has continued. I understand that the courts have also decided that a person euphemistically called an "unmarried wife" can be a member of the family. I think I can conceive one coming to that conclusion, so long as the relationship between these two people had gone on long enough. If it had gone on for years and they had been living together as though they were man and wife, I can conceive one coming to that conclusion. That is a decision which I believe I am right in saying the courts have come to.

For these reasons, I should advise your Lordships against attempting to insert a definition. I do not believe that it is possible to find a satisfactory definition, and that being so I believe that it would be wiser to follow the precedent of the Rent Acts and leave it to the wisdom of the judges, who are wise people in matters of this sort, rather than to attempt a cast-iron definition. Finally (and this is the reason which to my mind is really conclusive) we have just passed through this House a similar Bill for Scotland, in which this matter was canvassed and discussed, and your Lordships decided not to insert a definition. Therefore, if we were to insert a definition now we should have a definition in England and none in Scotland, and I cannot think that that would be a desirable state of affairs. On the whole, I should advise the House not to insert a definition, though I readily understand the reason which has actuated the noble Lord to move this Amendment and the noble Viscount to support it.

VISCOUNT SIMON

My Lords, I confess that this is a very puzzling matter to decide. Of course, it is not accurate to say in the abstract, that the courts have decided that such-and-such a person is a member of the family. They have done so in connection with a particular Act of Parliament, one of the Rent Acts, which has used the word "family" without defining who is a member of the family. On the other hand, if you take such legislation as the Workmen's Compensation Act, where there are provisions to compensate the dependants of a person who is killed, there you have a list and a person has to be within that list to qualify as a dependant. So really what we have to decide in this particular case is whether we are going to adopt the precedent of the Workmen's Compensation Act, which sets out a list of relations, or whether we are going to leave it at large, as the Lord Chancellor is rather disposed to advise the House, in which case, of course, if there is a dispute, it will be for the courts to decide as best they can. I agree with the Lord Chancellor that one of the difficulties of the definition is that the right view as to whether a particular person is a member of the family depends upon the circumstances of the case.

There is reference in the Holy Writ to Simon's wife's mother, and I ask myself whether Simon's wife's mother was a member of Simon's family. Perhaps that would depend upon where she lived or which doctor attended her. There is a difficulty, and I doubt whether the Lord Chancellor has sufficiently expressed (although I feel sure his mind has allowed for it), how the difficulty will arise. The difficulty will arise in a very curious way. Under Clause 1 of the Bill, in certain conditions there is an extension for a further period of the terms of the lease. One of the things which will decide whether or not the extension is good will be whether the person who is residing in the dwelling house is the tenant or a member of his family. I can imagine a tenant who is anxious to secure the advantage of Clause 1 but who cannot continue to reside in the house himself seeking legal advice and calling attention to this clause. He might say to his solicitor, "I should like to be advised whether or not. if I put Miss Smith in residence here, I shall get the benefits of this clause." All that the adviser can tell him is, "That will depend on whether she is a member of your family." The man will then say, it may be: "She is not a blood relation of mine. I have known her for some time. We have been on very friendly terms of relationship. She has attended my wife during illness. Can-not you tell me whether or not she is a member of my family? "The only pos-sible answer of the person to whom that question is addressed will be:" No, I cannot tell you, because Parliament, in its wisdom, has not laid it down definitely who is or is not a member of the family."

That does create rather a difficulty. I suppose the way it would come to be decided in the courts—if it ever had to be decided—would be in a case where the landlord sought to recover a house and, denying that Clause I had extended the period of the lease, started an action for ejectment or something of that kind. The landlord in that case, no doubt, would say to the tenant, in effect: "You are not entitled to the benefits of Clause 1 because the lady" (or it might be "the gentleman")" residing in the house is not a member of your family." That is certainly a very odd point to have investigated. Whichever way it is done, I think that great difficulties will arise. It must be admitted that the matter has been carried very far under the Rent Acts. I think I am right in saying that under the Rent Acts, where a county court judge has discretion to decide. "family" has been held to include wife, husband, brother, sister, nephew, niece by marriage, grand-child—including a child adopted by the child of a tenant—stepchild, illegitimate child. It also includes what is called an "adopted child," even if there has been no formal adoption (now, of course, under the Adoption Act there is no doubt that a properly adopted child is a member of a family as normal children would be), and what is called an "un-married wife" who has borne the tenant children—that is one who is his wife in all senses save for the fact that there has been no marriage ceremony.

There is a great deal of the law in which one has to apply good sense in order to determine what is reasonable, and I suppose that that will be the case here. The question will be: "Would the ordinary man regard the person in question as a member of the family? "It is a problem which will present itself in certain cases. It would be neater and better if one could do justice by inserting a definition. It would be easy to put in a definition, but I must admit, feeling as I do that this is a matter which really turns very much on the circumstances of the particular case, that I share the Lord Chancellor's doubts as to whether we can properly put in a definition. It is a most unsatisfactory conclusion, but I am not disposed to urge the House to differ from what the Lord Chancellor has said.

LORD TOVEY

My Lords, I should like to thank the noble and learned Viscount for dealing with my Amendment at such length. Undoubtedly, his argument is extremely convincing. I felt that I should have liked to urge perhaps the insertion of a partial definition, in order to avoid as much litigation as possible in the future; but, after listening to what noble Lords have said I feel that to do so would hardly better the case. In the circumstances, I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

First Schedule [Transitional Provisions relating to section two]:

LORD MACDONALD OF GWAENYSGOR

My Lords, this and the following Amendment are drafting, consequent upon the Amendments to Clauses 1 and 2 to which I have referred many times this afternoon. I beg to move.

Amendment moved— Page 16, line 43, leave out from ("is") to end of line and insert ("residing in the dwelling-house ").—(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.

LORD MACDONALD OF GWAENYSGOR

My Lords, I beg to move the next Amendment.

Amendment moved— Page 17, line 3, leave out from ("are") to the first (" in ") in line 4 and insert (" residing in the dwelling-house ").—(Lord Macdonald of Gwaenysgor.)

On Question, Amendment agreed to.