HL Deb 26 February 1953 vol 180 cc841-52

3.7 p.m.

Order of the Day for the House to be put into Committee read.

Moved, That the House do now resolve itself into Committee.—(Lord Mancroft.)

On Question, Motion agreed to.

House in Committee accordingly:

[The LORD MERTHYR in the Chair]

LORD LUCAS OF CHILWORTH moved to insert as a new Clause 1:

Amendment of subsection (2) of section two of 50 & 51 Vict. c. 28

"1. Subsection (2) of section two of the Merchandise Marks Act, 1887, shall be amended by inserting after the word 'manufacture' the words 'or who at any time whether before or after a sale sends or delivers an invoice, account or statement in respect of'."

The noble Lord said: In moving the first of the Amendments standing in my name on the List of Amendments before your Lordships, perhaps, as a few weeks have passed since your Lordships considered this Bill on Second Reading, you will forgive me if I refresh your Lordships' memories, and incidentally my own, from the brilliant speech which the noble Lord, Lord Mancroft, delivered on that occasion about the purpose of this Bill. In that delightfully concise manner in which the noble Lord always treats matters which he brings before your Lordships, the noble Lord said (OFFICIAL REPORT, Vol. 180, Col. 263): The first purpose is to attempt to widen the legal definition of the expression 'trade description' and, by so doing, to give greater protection to honest traders against those traders with fewer commercial scruples. The second purpose is to try to afford greater protection to the public generally and to the shopping public in particular. That is the admirable purpose of this Bill and that is the purpose to which I address myself in moving the first of these Amendments.

The noble Lord, Lord Mancroft, has told your Lordships, quite rightly, that one of the developments since 1887, when the Merchandise Marks Act was first brought into operation to attempt to protect the honest trader and the public, is that the technique of deception has grown. It has grown so much that to-day the public are really martyrs of an insidious campaign of delusion. There are many ways in which this can be carried on. The noble Lord illustrated the point by giving descriptions of misleading advertisements. First, there is the advertisement which misleads by giving a false or misleading description. One of the things which this Bill seeks to do is to widen the scope of a "false trading description" to include a misleading description. The buyer can be misled by an advertisement or by a salesman by word of mouth. The first Amendment which I am moving is designed to extend that protection. In these days, packing notes, pro-forma invoices (when cash is wanted before delivery) and credit invoices (when cash is required after delivery) can all contain false descriptions.

Perhaps noble Lords may find this Amendment rather intricate, because this is a Bill to amend the previous Act; therefore the Amendment I am moving to the Bill before you is in terms amending the Act of 1887. This Amendment seeks to insert the words printed in the Order Paper in Section 2 (2) of the 1887 Act. That subsection says: Every person who sells or exposes for or has in his possession for sale or for any purposes of trade or manufacture"— and I ask your Lordships to insert the words— or who at any time whether before or after a sale sends or delivers an invoice, account or statement in respect of"— and then the subsection continues— any goods or things to which.… et cetera. I think this is a desirable Amendment because it will make the Section as watertight as possible. I think I have said enough to enable your Lordships to grasp what I am trying to do. I believe that this Amendment would benefit the Bill, and tighten it up. I beg to move.

Amendment moved—

Page 1, line 5, at the beginning, insert the said new clause.—(Lord Lucas of Chilworth.)


The noble Lord, Lord Lucas, has moved his Amendment quite clearly and very fairly. What he seeks to do is something with which nobody, in theory, could possibly quarrel. He seeks to catch a few more rogues, a few more dishonest traders. Half of his Amendment is perfectly all right; but, unfortunately, it seems to me that the other half takes the offence right outside the scope of this narrowly drawn measure. What the noble Lord is trying to do is to go far further in his attempt to catch rogues and vagabonds than this Bill is intended to go. The inclusion of a particular description in an invoice—and invoices and similar documents are what the noble Lord is particularly concerned with—at the time of, or immediately before or immediately after (that is, in the sense of being "contemporaneous with") sale but before the transaction is completed, has already been held to amount to the application of that description to the goods for the purpose of the 1887 Act. Therefore, that part of the Amendment—the "before," or contemporaneous part—is not really necessary: that rogue and vagabond is caught by the Act as it now stands. Perhaps I can explain that to the noble Lord more easily by giving him two or three examples of the type of offence which I think he has in mind.


Could the noble Lord say where in the 1887 Act that is?


I am coming to that. First let me take the case of "after," which the noble Lord is principally worried about. A man, let us say, orders a pullover labelled "All wool"; it is cotton, but the subsequent invoice calls it "All wool." The false trade description was in the original label in that case, and that will be a sufficient basis for prosecution under the Act as it now stands. Section 5 of the Act of 1887 is, I think, the answer to the question the noble Lord raised. That is one case. The next case is this. A man orders a pullover not marked at all, saying: "I want that pullover." It is made of cotton, but the invoice describes it as being of all wool. The man got what he asked for, and there was no deception. Take the third case, the extreme case. A man chooses a pullover not bearing a label. The shopkeeper says to him: "It is all wool," and the subsequent invoice describes it as "All wool"—that is what the noble Lord has in mind—but it proves to be cotton. The false description was oral. An invoice merely furnishes confirmatory evidence. The purchaser has civil remedies for breach of contract or of warranty—indeed, actions on that line are quite common. An amendment to Section 5 in the Patents, &c. (International Convention) Act, 1938 (I am sorry this is so complicated but, as the noble Lords knows, it is mixed up with three or four different Acts) provides further that goods delivered in pursuance of a request made by reference to a trade description appearing in any sign, advertisement, invoice, wine list, business letter, business paper, or other commercial communication shall be deemed to be goods in connection with which the trade description is used. That catches in particular the mail order rogue, about whom I think the noble Lord is worried. Therefore, the trade description in an invoice is already deemed to be applied to goods ordered by reference to it.

But it is the word "after" in Lord Lucas's Amendment that produces an entirely new situation. If at the time of the sale, the purchaser got what he asked for and was not deceived, then a false description in a subsequent invoice has no relevance to any question of merchandise marks legislation, the main purpose of which is to prevent deception as to the description of goods bought and sold. If, at the time of the sale, the goods were orally misdescribed, the subsequent invoice might afford confirmatory evidence, but this, in effect, introduces a new offence of oral misdescription and it cannot in any sense amount to a merchandise mark. That is the point, and it is altogether too wide an innovation and takes the offence, in my submission, right outside the scope of this Bill. Oral statements are, as I say, outside the scope of the general body of legislation which is directed to the marking of merchandise. I am sorry I cannot recommend your Lordships to accept this Amendment. I respect entirely the object the noble Lord has in mind in putting it down, but it is not, in my submission, a proper offence to try to bring within the scope of this Bill, and, as I have already explained there are other civil law remedies. In my submission, it would be quite inappropriate in this measure, and it is with much regret that I cannot recommend your Lordships to accept the Amendment.


I have been trying to follow what the noble Lord has said, and I think I have succeeded to a certain extent. I should like to take him back to the second example that he gave, when a person asks for, and gets, a pullover, and subsequently receives an invoice in which it is stated that the pullover is all wool but it is not.


Does the noble Lord mean a pullover in the sense of a pullover which he sees?


Yes, take the case of a pullover he sees.


Without any description?


Without any description and, if you like, without any representation. I believe that is what the noble Lord, Lord Mancroft, had in mind—that there was no representation at the time of the sale. It may be that the purchaser believes it is wool, but let us assume that nothing is said at the time. Subsequently an invoice is sent, and on the invoice it is stated that it is wool, whereas in fact it is not. One of the purposes of this Amendment is to bring that kind of offence within the terms of the Act, and I would respectfully suggest that it does in fact amount to a false or misleading trade description, and that there is no reason at all why that kind of case should be excluded.


It seems to me that the noble Lord's Amendment is really an Amendment to the Sale of Goods Acts, and is rather inappropriate to this Bill.


I do not know whether my question should be addressed to the noble Lord, Lord Lucas, or my noble friend Lord Mancroft. As I read the Bill, it is an offence to have in one's possession misdescribed goods, and yet my noble friend opposite seeks to limit that further by making it an offence to invoice misdescribed goods. Surely the fact of possession is the far larger field and already embraces the smaller field which the noble Lord wants to bring in by this Amendment.


I think we had better start off on the principle that all questions should be addressed to the noble Lord in charge of the Bill, who happens to be learned in the law. He is supported by the noble and learned Lord, the Lord Chancellor. I am not even a common lawyer, and so I do not want the disadvantages under which I suffer added to by noble Lords opposite. The noble Lord is quite wrong when he says that the Amendment is out of place, because it specifically refers to "sale." I have tried to understand the noble Lord, but I have not the trained legal mind of my noble friend Lord Silkin. I can only hope that any housewife who happens to read the noble Lord's little speech will now rest assured that the next time she goes and buys anything she will know exactly what she is doing. I tried to follow the noble Lord's argument. He dealt with a case before sale and after sale. But he did not, if I followed him correctly, deal with the incident of at the time of sale.


Yes, I did.


What happens, then, if a false description is put down on a cash sale invoice at the time of purchase?


It is contemporaneous.


I cannot quite make out why it is that a documentary false statement, whether before, at the time of, or after sale, is held to come under two or three other Acts of Parliament, but a misleading advertisement or a misleading statement (according to the noble Lord's speech on Second Reading) is held to come within this Bill. That is what I cannot understand, because it appears to me that the noble Lord can ride off any Amendment by saying "Well, it comes under the Sale of Goods Act," or "it is a breach of warranty" or that it is something else. What I understood we were trying to do was to strengthen the 1877 Act so that the buying public could be safeguarded against a false or misleading description.

A misleading description can be given in three ways: by advertisement, by word of mouth or by being written on a document. I am sorry, but I cannot understand why, if the noble Lord will admit the case of an advertisement, and the case of word of mouth, he rejects the case when the description is put into writing. The Amendment reads: …whether before or after a sale sends or delivers an invoice, account or statement.… Therefore, it can be any one of three, and a statement could be a letter or something scribbled on a piece of paper. Your Lordships have now made up your minds that you are going to have an amusing afternoon, but as the noble Lord has told me that half my Amendment is good but that the other half is not, will he now tell me which half is good? Then, perhaps, I shall be willing to take away the other half.


Half is unnecessary, and half is bad.


All I can say is that I hope the noble Lord's words will be clear to the housewife—the class of person for whom the noble Lord had great pity on Second Reading; I think he used the expression "the poor deluded female,"—who is the easy prey of these people he wants to get, and that she will be quite happy and content in her knowledge as to how she can prove that she has been swindled or had false representation made. With that assurance from the noble Lord, I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

3.27 p.m.

LORD LUCAS OF CHILWORTH moved, immediately before Clause 1 to insert as a new clause:

Amendment of subsection (3) of section two of 50 & 51 Vict. c. 28.

".Subsection (3) of section two of the Merchandise Marks Act, 1887, shall be amended by inserting after paragraph (iii) the words 'and (iv) in any case, to refund to any person or persons who have purchased goods falsely described, the full purchase price thereof'."

The noble Lord said: This Amendment should be read in conjunction with the last Amendment. The object is that if a person procures something that has been falsely described, and a case is successfully prosecuted, the Board of Trade should be authorised to refund to the purchaser the cost of those goods after it has been recovered from the person who has been proved guilty. With this Amendment, as with all the others, I am not tied to the wording—some of it is my own poor effort, but some has been drafted on the best legal advice that is open to me. The latter, I would say, is wholly good, and the former, very likely, wholly bad.


Which is which?


The noble and learned Lord wants to pay me a subtle compliment—I can see that. But this Amendment does not only seek to take care of the case of policing the Act. I shall come to that later. Of course it is the responsibility of somebody, and I shall seek later to place on the Board of Trade the responsibility of testing this Act. On quite a number of occasions test purchases will have to be made—whether by the method of agent provocateur or not I need not go into to-day. In some cases, where the Board of Trade instituted proceedings under this Act, in order to obtain evidence the Board's agent would have to make a test purchase or purchases. If the case was then taken to a court of summary jurisdiction it would be open to question whether or not the award of costs should include the cost of the purchase. If it did not, the taxpayer would pay, because those costs would come out of the Board of Trade Vote. On the other hand, if a public-spirited private individual, with money to burn, prosecutes his own case I maintain that he should be able to obtain a refund of the price of the article he has purchased before bringing that case. Perhaps the wording of this Amendment on close scrutiny, will tempt the noble Lord to say, "As the Amendment is worded, everyone in the country who has purchased an article similar to that proved to have been falsely described would be able to get money back." That is not what I want. What I want is that there should be a refund of the price of the actual article purchased for the purpose of proving the false description.

When he addressed your Lordships on Second Reading, the noble Lord, Lord Mancroft, cited the instance of a bottle of whisky. Take the case of somebody who buys a bottle of whisky to prove a false description, whether he be an agent of the Board of Trade, or acting as agent provocateur or as a private individual. I maintain that, if the person who has falsely described the goods is convicted, that convicted person should be made to refund to the purchaser the cost of the goods and to take the goods back. I expect I have made clear to the noble Lord in charge of the Bill, and I hope also to other noble Lords, exactly what I am seeking to do. I beg to move.

Amendment moved—

Page 1, line 5, at the beginning insert the said new clause.—(Lord Lucas of Chilworth.)


My Lords, it is not the wording of the noble Lord's Amendment that worries me so much as the principles behind it, although I must confess that the wording, as it is at the moment, would have—and I expect the noble Lord, Lord Lucas, realised this—some fairly comic results. Certainly, as he has rightly forecast, in a prosecution such as he has envisaged, people who felt themselves aggrieved could technically, I suppose, queue up and ask for recompense, and technically, as the wording of the Amendment now stands, the man who is penalised could go up and down the chain of distribution collecting something for the kitty all the way, which again would provide some very comic results. I do not think that that is what the noble Lord intends should happen, but it is what, in fact, clearly would happen if his Amendment were to be incorporated in the Bill.

The real objection to this is, I am afraid, the same objection as I have already touched upon in regard to the previous Amendment—namely, that the noble Lord is confusing civil and criminal proceedings; and, though he may perfectly well turn round and tell me that that is an ultra-legalistic attitude to adopt, it is a very genuine and real one, because, although Lord Lucas's Amendment is framed as an additional penalty, its purpose really is to provide compensation to the deceived purchaser; and compensation is properly a matter for civil and not for criminal action. There is nothing in the Act of 1887 (the original Act) to limit the civil rights of those who have suffered loss through false trade description. Indeed, that Act enhances those rights by providing in Section 17 an implied warranty that a trade description applied to goods is not a false trade description. The proper place for the exercise of those rights surely is the civil courts and not the criminal courts where a prosecution would be brought. The purchaser would have little, if any, difficulty in recovering damages for breach of the implied warranty. Indeed, I should imagine there would never be any need for the action to be brought in the civil courts if the prosecution had been successful.

Therefore, I would suggest to your Lordships that this, again, is an attempt, and a praiseworthy attempt, to make things easier for the man who has been defrauded, but it is misconceived because it confuses civil and criminal action. It is my submission to your Lordships that a man thus deceived already has, under the principal Act, perfectly adequate protection and safeguards. I should have liked to accept this Amendment because I know the noble Lord has taken a lot of trouble over it, but I am afraid I cannot recommend to your Lordships that it should be accepted, as I think it would introduce certainly a wrong principle and a wrong system of procedure into the Bill.


Would the noble Lord explain this point, for the sake of clarity, because this is causing various sections of people a lot of thought? If the Board of Trade take action under the Act and spend money in making test purchases, then the taxpayers' money has been at stake and there is no need for reimbursement because only the taxpayer is out of pocket. But if a private individual takes a case, he cannot get any redress for the cost to which he has been put in making that test purchase—and that cost may be very heavy—unless the court of summary jurisdiction takes into consideration the amount of expense to which the individual has had to put himself in order to make the test purchase. If, when the offender has been convicted, the court of summary jurisdiction does take into account that the individual prosecuting has had to spend, let us say, £10 or £15, as well as his solicitors' costs, then my point is made. But there is no obligation on the court to do that.

Many of these cases are brought by protection associations or fair trading associations who have to so to great expense in engaging barristers, because they cannot afford to have anything less than the best since they cannot afford to lose their case. If a protection association were to lose a case under the Merchandise Marks Act it might have serious repercussions upon the honest traders who provide the money to keep their trade clean by policing the Act for the Minister. Sometimes the costs are about £150, including the cost of test purchases; and sometimes the award of costs reaches the sum of £50, but it has been known to be only a few guineas. Now, how can one expect people to go on policing these things for the Government when on every case they bring they lose money? That is why I said I wanted this Amendment taken into consideration with the last Amendment on the Order Paper. If the noble Lord is going to give me my last Amendment, then in so far as the Board of Trade will authorise someone else to undertake a prosecution and will reimburse the cost, I do not mind, for then the cost of the procurement of the article on which the case is based would come within those costs. Then whether or not the court awarded the man only ten guineas costs would not matter, because if the costs were £150 the Board of Trade would pay. But when the poor individual does it on his own, or when it is done by a corporate body or a trade association and no costs are granted, I cannot see that that is fair. The noble Lord may say it is, and that the remedy lies in civil action and not in the criminal action.

I put this final point to the noble Lord, Many trade associations have by-laws which have the protection of the Common Law. Trade associations can go to the courts and have their by-laws enforced. The British Motor Trade Association, which has troubled your Lordships with many cases in the past, is an instance in point. They go to the courts to uphold their by-laws. But this is a case of a private individual or a body of private individuals in an association going to the courts to do a job which the Government should do itself, and that is to police an Act of Parliament, not a by-law of an association. That is the difference as I see it. If the Board of Trade or any Government Department take this action it matters not: the taxpayer pays; but if private individuals or a body take it and get only small costs allowed them, they have to stand the bulk of the expense themselves.


My Lords, in order that I may make a statement similar to that which is being made in another place by my right honourable friend the Prime Minister, I beg to move that the House do now resume.

Moved, That the House do now resume.—(Viscount Swinton.)

On Question, Motion agreed to, and House resumed accordingly.