HL Deb 15 July 1958 vol 210 cc1081-105

5.16 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.—(The Lord Chancellor.)

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD MERTHYR in the Chair.]

Clause 1:

Restriction upon recovery of possession, etc., of certain decontrolled dwelling-houses.

(2) Subject to subsection (3) of this section, this Act applies to any dwelling-house to which the Rent Acts ceased to apply by virtue of subsection (1) of section eleven of the Rent Act, 1957, being a dwelling-house in the case of which the following conditions are satisfied, that is to say—

  1. (a) that notice has been served on the tenant by the landlord, whether before or after the commencement of this Act, under stub-paragraph (2) of paragraph 2 of the Fourth Schedule to that Act (which paragraph enables tenants under certain tenancies subsisting, immediately before the commencement of that Act to retain possession until a date, not earlier than the sixth day of October, nineteen hundred and fifty-eight, specified in a notice served by the landlord); and
  2. (b) that until the date specified in the notice, possession of the dwelling-house is retained by a person entitled to retain such possession by virtue of the said paragraph 2;
and "the occupier", in relation to a dwelling-house to which this Act applies, means the person by whom possession of the dwelling- house is retained as aforesaid or, in the event of the death of that person, any person who, by virtue of paragraph (g) of subsection (1) of section twelve of the Act of 1920, would have been qualified to retain possession of the dwelling-house if the Rent Acts had not ceased to apply to it.

(3) If the occupier of a dwelling-house to which this Act applies—

(b) retains possession of the dwelling-house or any part of the dwelling-house as tenant under a tenancy (whether granted before or after the application of this Act to the dwelling-house) not expiring, or terminable by notice to quit given by the landlord, earlier than three years from its commencement,

this Act shall cease to apply to the dwelling-house or to that part of the dwelling-house, as the case may be; and without prejudice to the foregoing provision, this Act shall not apply to a dwelling-house or any part of a dwelling-house during any period during which the occupier is entitled to possession of the dwelling-house or of that part of the dwelling-house as tenant under any tenancy granted by the owner.

LORD SILKIN moved in subsection (2), after "in the case of which" to insert "either of". The noble Lord said: The Committee will be relieved to hear that Amendments Nos. 1, 2, 3 and 4 stand or fall together. I hope that they stand together in the conciliatory atmosphere which seems to have prevailed this afternoon, and I hope that they can stand without the number of speeches made on the previous occasion. The series of Amendments which I have put down are identical in terms with the Amendments which were put down in another place on the Report stage of the Bill. On that occasion they were put down at very short notice, and there was some complaint by the Minister in charge that he had inadequate notice to study their terms and implications and that there was some doubt about whether the effect of the Amendments was fully appreciated. The noble and learned Viscount in charge of the Bill in your Lordships House will have had ample opportunity of considering this series of Amendments, and I hope he will agree that they are reasonable and should be accepted.

The purpose of the Amendments is to provide for the case of the tenant who is in possession under a lease or agreement which expires after the extended day on which the Rent Act comes into operation and whose premises would have been controlled but for the operation of the Rent Act. As an example, it would deal with the case of a dwelling-house in London of a rateable value of, say, £80 a year, the tenant of which has been in possession under a three-years agreement which expires on November 1. On that day the Rent Act as it stands comes into operation, and his tenure comes to an end, although but for the operation of the Rent Act the house would have continued to be controlled. The Rent Act decontrols it and he no longer has the right of possession. The purpose of my Amendments is to give such a tenant the same opportunities of being relieved of hardship, of being able to come before a county court and make a case that he has not been able to find any other accommodation, as is provided for a similar person whose tenancy comes to an end before October 7, which is the material date.

The point seems to me so reasonable that it hardly needs any advocacy. On the spur of the moment the Minister in another place made the point that this would be an extension of the Rent Act. I suppose it would. But the Bill which is now before the House is an extension of the Rent Act. The Rent Act contemplated that controlled tenancies would come to an end at the expiration of the notice to quit, which could be given to expire in October, but this Bill provides a tenant with a possibility of continuing the tenancy for two years or more. So it is an extension of the Rent Act. If one is to treat one tenant in no more favourable way than another, I submit that there is no reason why a person whose tenancy expires on October 7 should be treated in a worse way than a person occupying a similar dwelling whose tenancy expired by notice to quit expiring on October 5. For these reasons, I feel that this is an omission in the present Bill which ought to be remedied with a view to treating all tenants alike. I beg to move.

Amendment moved— Page 2, line 1 after ("which") insert "either of".—(Lord Silkin.)

THE LORD CHANCELLOR (VISCOUNT KILMUIR)

I should like to assure the noble Lord, Lord Silkin, of two things: first, that the point has now had very careful consideration; and secondly, that no argument in favour of it was neglected in his speech. I want to put before him why my right honourable friend and I feel that we cannot accept this Amendment. As the noble Lord said, the object of these four Amendments is to give the protection of the Bill to a tenant under a contractual tenancy expiring after October 6, 1958, when that tenancy comes to an end. Let me remind your Lordships of what is necessary for a dwelling to come within the provisions of this Bill. First of all, a notice to quit must have been served on the tenant under paragraph 2 of the Fourth Schedule to the Rent Act, 1957; and secondly, the tenant must have retained possession by virtue of that paragraph until the date specified in the notice to quit. Paragraph 2 applies, however, only to decontrolled tenants who either were holding over as statutory tenants when the Rent Act came into force on July 6, 1957, or had contractual tenancies which would come to an end during the period of fifteen months between July 6, 1957, and October 6, 1958. Paragraph 2 does not apply, and therefore the Bill as drafted does not apply, where there is a contractual tenancy which cannot expire until after October 6, 1958.

There are two main reasons for limiting the class of tenants protected by the Bill to statutory tenants or contractual tenants whose tenancies came to an end during the fifteen months period—that is, before October 6. The first is that this is a transitional Bill to deal with the difficulties that might arise if a concentration of notices to quit all took effect on or about the same day, October 6, 1958. The great majority of notices have, in all probability, been dated to take effect on the earliest possible date, which is October 6; and although the total number involved is not likely to be very large, difficulty might well arise from their concentration about that time, which would mean that all the tenants concerned would be trying to find at the same time other accommodation into which to move. The Bill, by providing for the suspension of orders for possession in cases of hardship, will break up this concentration, while allowing more time to those tenants who genuinely need it. The application for orders for possession will not all be made or heard at once, and the periods of suspension will vary.

That is the position as to the tenancies which I have described and which we have put in the Bill. However, those dealt with in the Amendment of the noble Lord, Lord Silkin—that is, contractual tenancies expiring after October 6—will not be concentrated; they will not all end on the same day but will be spread naturally, according to the date at which they were entered into and the length of the tenancy. Therefore, the problem of concentration does not exist. That means—and I put it quite generally—that the tenants of these tenancies will not be subject to the same co-existing pressures to find houses as are the tenants in the Bill.

The second point why we say that we do not require a special provision is this. The tenant under such a tenancy knows when taking it on that it runs for a term of years at the end of which he may or may not be able to renew. The Bill does not alter that situation. It might be argued that on this ground contractual tenancies expiring between July 6, 1957, and October 6,1958, should be excluded, but they will have merged with the statutory tenancies before the standstill period ends, because in both kinds of case the tenant's right to retain possession ends on October 6, 1958. All Parties in the State have been saying that something should be done about the Rent Acts, whether or not they agree with the method that we have adopted.

The noble Lord, Lord Silkin, with that skilful and moderate advocacy of which he is a master, then passed to the hard case that is up against the line. He said that a tenant would be all right when the tenancy expired on October 5, but all wrong if it expired on October 7. That is an argument which is not entirely unknown in legislative assemblies. It is one of the difficulties of drafting a Statute that one has to draw a line somewhere, and that up against that line there is bound to be a hard case But I think, apart from that general fact, October 6, 1958, is the most obvious choice for the line, because it is the date which paragraph 2 of the Fourth Schedule to the 1957 Act uses to distinguish between those contractual tenancies which expire (or may be made to expire) before it, and are therefore included in the standstill, and those which are not. I want to assure the noble Lord that we did consider this point carefully.

He dealt with the point about the re-imposition of control. I should like to emphasise—I do not want to repeat it over and over again—that I made it clear on Second Reading that the object of this Bill is to deal with certain hardships. We do not think it is a very large number. For the reason I have given, which I described as the concentration, there are bound to be a number of hard cases because of the difficulty of these people in finding accommodation at that particular time. These are the cases with which the Bill is proposing to deal and, as I emphasised, it does not mean a reimposition of control.

As the noble Lord, Lord Silkin, knows. I never take a technical objection to an Amendment. He may take it from me that there is a technical objection here, in that he would omit paragraph (b), and it is rather difficult without that paragraph to follow on in the words of the clause. Of course, I am not taking a point of that sort, and if the House decided that the noble Lord's Amendment was right in principle, I should take steps to put it right. But, for those reasons, I am sorry that my right honourable friend and I have not been able to agree to this Amendment, and I must ask the Committee to reject it.

LORD SILKIN

Perhaps I should say a word in reply before your Lord ships decide. First of all, I am not surprised to find that the wording is defective—indeed, I should have been very surprised if it had been a perfectly worded Amendment. But the noble and learned Viscount has been very generous about it, and therefore I need say no more. I was under the impression that one of the reasons for this Bill was the hardship which will arise to the people who suddenly have to find accommodation. I would suggest that the same hardship exists in the case of a person who has a contractual tenancy which expires after October 6. He is now in competition with a great many other people, all looking for accommodation of which there is a short supply. He would have been a controlled tenant but for the Rent Act. He would have had the same security as the people who are being catered for under this Bill. It does not ease matters for the other tenants that he now becomes a competitor for the accommodation; indeed, it makes matters much worse for them.

I do not think there is much more I can say, except to repeat some of the arguments I have already made. The noble and learned Viscount has made up his mind, and I am very sorry about it. This is not a matter of principle at all; this is just a matter of adding a few more people to those for whom provision is made. As the noble and learned Viscount said that the number of people affected is relatively small, then the number of people who would be affected by my Amendment would be minute, and it could not possibly create any difficulties if the Amendment were accepted. I hope, therefore, that he will, even at this late hour, give some thought to it between now and the next stage. I do not ask him for any assurance, but I promise him that he may see this Amendment again, perhaps in an improved form, at a later stage.

THE LORD CHANCELLOR

I am always ready to give consideration to any Amendment which the noble Lord proposes, but according to my custom I always try to distinguish between telling your Lordships those in which I can hold out some hope and those in which I cannot. I cannot hold out much hope here, but I will consider and report to my right honourable friend what the noble Lord has said. I think that that is the fairest way of putting it to the noble Lord to-day.

On Question, Amendment negatived.

Clause 1 agreed to.

Clause 2 [Obligations and rights of persons holding over]:

LORD STRATHCLYDE

Clause 2(5) is the application of this clause to Scotland, and it lays down the rent payable by an occupier in Scotland for a period between the expiry of a notice to quit and a decision of the court on an application by the landlord for possession of the house. It also lays down the responsibility of the owner and the occupier for repairs to the house during the application of the Bill. This Amendment follows a similar Amendment relating to England and Wales which was inserted at the Report stage in another place to make it abundantly clear that the liability for repairs set out in the clause does not affect the responsibility for the repair of damage or dilapidations occurring before the Bill takes effect. Responsibility for the repair of such damage and dilapidation will continue to rest on the parties in accordance with their previous agreement. I beg to move.

Amendment moved— Page 4, line 28, after "and" insert ("(without prejudice to the liability of any person in respect of any other damage or dilapidations)").—(Lord Strathclyde.)

On Question, Amendment agreed to.

Clause 2, as amended, agreed to.

Clause 3:

Suspension of execution of order for possession

(2) In relation to any period for which the execution of an order for possession of a dwelling-house is suspended under this section, subsection (2) of section two of this Act (except so far as that subsection relates to responsibility for repairs) shall not apply, but the rent to be paid by the occupier in respect of any rental period or part of a rental period falling within the period of suspension shall be at such rate as may be specified in the order, being the rate demanded by the owner or, if the court is satisfied that a rent at the rate so demanded would be beyond the means of the occupier, such lower rate as appears to the court to be within his means, not being less than the rate at which rent was payable immediately before the beginning of the period of suspension:

5.38 p.m.

LORD SILKIN moved, in subsection (2), after the fourth "be" [beyond the means] to insert "unreasonably high or". The noble Lord said: This Amendment and the next two stand together. The purpose of this Amendment is to modify to a reasonable extent the possibility that a landlord may demand a rent from a tenant as a condition of being able to hold the tenancy over after October 6—a rent which is exorbitant and wholly unreasonable. As Clause 3 (2) stands, if a tenant applies to the court for an extension, the landlord can demand any rent he likes, however unreasonable or however high. The wording of this clause says … at such rate as may be specified in the order, being the rate demanded by the owner… So long as the tenant cannot prove that he cannot pay this rent, however unreasonable, then the court has no power but to require the tenant to pay that unreasonable rent as a condition of his being able to stay on.

In another context there has been some kind of decision as to what is regarded as a reasonable rent. In this Bill itself it is twice the annual value, together with the cost of services. Some landlords are demanding three times the annual value as the condition of granting a new tenancy. But, at any rate, there is some kind of yardstick as to what is a reasonable rent, whereas in this provision there is no yardstick at all. The landlord can demand anything he likes, and therefore the protection which is being given to the tenant is quite illusory. The mere fact that the tenant has the means to pay the rent is no justification for a landlord demanding that rent. The tenant may have large savings and he could pay the rent out of his savings, but it is grossly unfair and takes away with one hand the privilege which is being granted under this subsection with the other. My Amendment would insert the words "unreasonably high", so that it would read: … being the rate demanded by the owner or, if the court is satisfied that a rent at the rate so demanded would be unreasonably high or beyond the means of the occupier … I think it is an Amendment which ought to be accepted unless the Government are determined that whatever a rapacious landlord may ask is justifiable and, indeed, that this so-called concession is not intended to be a concession at all in a great; many cases. I beg to move.

Amendment moved— Page 5, line 32, after ("be") insert ("un-reasonably high or").—(Lord Silkin.)

LORD MESTON

May I point out in a few words that the present Bill deals with decontrolled property. We are not in a position under the present Bill to dictate to landlords what rent they should demand. That is the existing provision under the Bill as it stands. But I do not think there is any necessity for the noble Lord, Lord Silkin, to take a pessimistic view of this matter at all. Under the Bill as it stands, if a landlord demands a ridiculous rent the tenant merely has to prove that he has not the means to pay it. We all know a good deal about the operation of the county courts. Does the noble Lord, Lord Silkin, really suggest that a tenant would have to pay out the whole of his capital, if he possesses any, in order to meet a year's rent? I do not think for a moment that that is the way the Bill is expected to work or will in fact be worked by the courts. I feel that the noble Lord, Lord Silkin, is taking a very pessimistic view of the matter, and I hope your Lordships will agree with my view.

THE LORD CHANCELLOR

The noble Lord, Lord Meston, has shown that there is on this Amendment a serious matter of principle. I refer to what the noble Lord, Lord Silkin, said with regard to the last Amendment. Certainly the first of my objections is the point of principle which the noble Lord, Lord Meston, has just adumbrated. These are decontrolled dwellings, and the appropriate rent for a decontrolled dwelling is what it will fetch in the open market. The difference between a decontrolled dwelling and a controlled dwelling is that the landlord is entitled to ask for what he wants. However attractive it may seem to provide for the determination of reasonable rents by the court, that is in fact a reimposition of control. That is the first principle.

But this Bill is one, as I said, to avert genuine hardship and not to interfere with the principle of decontrol. Because it is a Bill to avert hardship there has to be a provision for reducing the rent if the occupier cannot afford what the owner asks. That is in the Bill and that will operate, and I am sure operate fairly and well. Such a provision would be open to serious objection in a permanent Bill, but it can be accepted in a temporary measure like the present where, without it, the whole purpose of the Bill might be frustrated. If the owner is asking a high rent but the occupier can afford to pay that high rent, there is no reason why the rent should be fixed at a lower figure, since if the occupier can afford the rent there can be no hardship. If the owner is asking more than the reasonable market rent for the premises the occupier who could afford to pay the rent which the owner is asking is likely to be able to go elsewhere and get better value for his money.

I think the noble Lord on reflection would agree that he took rather extreme figures when we had a rather spirited discussion on this matter on Second Reading. The idea of somebody asking for £2,000 a year for a house that ex hypothesi had been let for under £100 in London in 1939 is not a very likely figure. I will take Lord Silkin's figures for convenience. Assume the rent is, in round figures, £100, and the owner is asking for £200 or £300. I still suggest (I do not want to elaborate it) that my point is good, that if that person can afford to pay £300 a year he can probably afford to get other premises. But if he is asked, as is the case under this Amendment, not for £200 or £300, because they are within the range of reasonability, but for £500, and can afford to pay £500, I find it very difficult to imagine he will not be able to get other premises.

The people who are in real difficulty and for whom your Lordships must provide are the people who are asked a figure—I do not mind whether it is £200, £300 or £500—and cannot afford to pay it. They must not be debarred from the rights given them under this Bill because they cannot afford to pay; and that is what the Bill provides. That is why the Government, recognising this, has provided that there must be some power for the court to reduce the rent which the owner asks if the occupier genuinely cannot afford to pay it.

The second objection is based on a practical consideration. It may well be that in the absence of any guidance, as this is not a Bill to reduce rents the court would consider a rent unreasonably high only if it were significantly in excess of what the property could fetch on the open market. Such an interpretation would be capable of consistent application, for the rent which the property can fetch in the open market is something you can determine. But as soon as you get into that question you are bound to have professional evidence on either side as to what is the rent in the open market, and attempts to qualify numbers and classes of property in that way. I put this point seriously to the noble Lord, Lord Silkin, having regard to his great experience of litigation: I believe that that would be a bad thing in a Bill to remove hardship. I am now speaking entirely apart from the different angles from which we approach this question. If you are going to get a series of cases trying to arrive at a stratified reasonable rent, fought out with professional evidence in that way, you are going to spoil what I want this Bill to do—namely, provide means by which the person who is in hardship, who is sick or is short of money and unable to pay what the landlord asks, will be able to get that hardship catered for. If you turn it into a matter in which you have continual, most interesting discussions on what is a reasonable rent according to your professional standard, I think you will not really, at the end of the day, help the Bill. I have tried to put the point. I am sorry to have detained your Lordships.

May I just put this final point—after all, this is a transitional Bill; it is in operation for a relatively short period. I gave it great thought because I was most anxious to deal with the practical point about these people who, round about October 6, would be in great difficulty in finding other accommodation and, as I say, might have been prevented from doing so by their health or their age, and also those who were in financial difficulty in meeting the rents. I think we have provided for that and I do not want to argue any controversial points. I have put my arguments as quietly as I can. I know that there is a difference of feeling in this matter, but, apart from whether or not the noble Lord divides the Committee to-day, I should like him to consider my second point for the sake of his own comfort of mind—because it is some comfort of mind to me that we shall not be involving people in expensive, protracted litigation, with leading cases built up and taken up to guide them. Therefore, I cannot accept the Amendment.

LORD LATHAM

I was unable to be present on the occasion of the Second Reading of this Bill, and therefore I am without the advantage of having heard the arguments that took place on this point. I must confess—I say this with every respect for the noble and learned Viscount—that I am moved to the view that his arguments in opposition to the Amendment moved by my noble friend Lord Silkin, and the arguments which he advanced in support of the Amendment, are decidedly exiguous. The noble and learned Viscount said that the acceptance of the Amendment would amount to a re-imposition of control. So do many of the provisions of this Bill. The requirement that the rent asked for shall be within the means of the tenant (who has now, under this Bill become "occupier"), is an imposition—partial, I agree—of control for the duration of the operation of this Bill. I should like the noble and learned Viscount to tell me whether in fact, as the Bill is now drafted, the court is estopped from considering how high, how excessive is the rent which is demanded. The only thing that the courts can go into is the question of whether the rent demanded is within the means of the occupier or of the statutory tenant.

THE LORD CHANCELLOR

That is right.

LORD LATHAM

How is that to be ascertained? Is the court to apply a means test to the occupier? What kind of procedure is to be followed by the court in ascertaining whether the rent demanded is within the means of the occupier or of the tenant, whatever he is called? It seems to me to be a little unusual and somewhat unsatisfactory to ask the court (I assume the county court), as it were to apply a test as to whether the rent asked is reasonably and properly within the means of the statutory tenant.

THE LORD CHANCELLOR

May I say this, if it would help—I hope the noble Lord does not mind my interrupting. The county court at every sitting has to determine the means of litigants, because part of a county court judge's work at every sitting is that of dealing with judgment summonses and at what rah; people should pay debts. Therefore he has to find out their means. But there is another point that I emphasised on Second Reading, because I think this is most important from the aspect of humanity. Many people do not like their means being inquired into in public, and that was why I emphasised that the judge will be able to hold the hearing in camera if he wishes, and if the occupier so desires. But on the practical point, those of us who have spent many years in county court litigation know that a county court judge is probably the most expert person in the world at determining means and ability to pay. I am sorry if I have interrupted other than to advantage.

LORD LATHAM

I am much obliged for what the noble and learned Viscount has said. Neither I nor my noble friend Lord Silkin is without experience of applying means tests—not personally, of course, but when public assistance was a matter for county councils; and I do not think that either be or I are unacquainted with what is the procedure in the county courts as regards judgment summonses and the like. But I cannot feel that that is any justification for putting the determination of the rent to be demanded under this Bill on the basis of a means test. I am still a little disturbed as to how the means test will be applied, and whether it will not be the case that there will be varying standards of means in the various county court areas by reason of the differences of view and of outlook as between the respective county court judges.

It seems to me that it is much easier, much more practical, and I think much more decent, to rest the matter upon whether the rent demanded appears in the circumstances, having regard to the property, its condition, its accommodation, its size and the like, to be a reasonable rent, and not on whether, on one basis of calculation, it is a rent which is beyond the occupier's means, whereas, on another basis of calculation, it may be regarded as a rent within the means of the occupier. I hope that in the light of what has been said by my noble friend, and perhaps by myself, the noble and learned Viscount may feel disposed to reconsider the matter and deal with it at a later stage of the proceedings on the Bill.

THE LORD CHANCELLOR

I am sorry not to respond to that appeal. This is a matter which, I assure noble Lords, we have considered most carefully, from both points of view and, much as I should like to, I should be misleading them if I held out any hope on this occasion. I am sorry to adopt a non possumus attitude: I do not like it but I must on this occasion.

LORD LATHAM

I would say only that I share the sorrow.

On Question, Amendment negatived.

5.59 p.m.

LORD SILKIN moved, in subsection (6) (a), after "mother" to insert: and that having regard to all the circumstances of the case greater hardship would be caused by making an order granting suspension of the order for possession than by making an order for possession without suspension,".

The noble Lord said: I beg to move the Amendment standing in my name on the Marshalled List. This deals with the case where a contract for sale has been entered into before April 2, 1958. Clause 3 (5) (b) provides that in such a case, if the purchaser requires the accommodation for his own occupation or for the occupation of a member of his family, then, whatever the respective hardships may be, he is to be entitled to possession. The purpose of my Amendment is to put such a purchaser in exactly the same position as the landlord who sold the property would have been. In his case if the tenant can show that there would be greater hardship to him if an order for possession were made under Clause 3 (1) (d), then an order for possession will not be made. I feel that the fair thing would be to put a person who has contracted to buy the property in the same position as the vendor who sold it. I admit at once that there will be cases where a person has bought a property specifically for his own occupation or for the occupation of a member of his family; and he might have been looking forward to possession in October. Unless the occupier—the tenant—can prove that his hardship through being turned out would be greater, such a purchaser would be able to get possession.

I would ask, however, that the hardship of a tenant, to whom the noble and learned Viscount has earlier referred as a person who will be thrown on to the market with large numbers of other tenants on October 5, should be taken into account. The hardship of being turned out of accommodation is, generally speaking, much greater than the hardship to a person looking forward to going into a house. If, however, the person who has contracted to buy can really show that his hardship is greater, then of course he will get possession, even under the terms of my Amendment. So I am asking that there should be incorporated in this Bill this test of hardship as regards a person who has bought a property but who is not in occupation, in the same way as hardship is assessed in relation to a landlord who is seeking possession and has not sold the property. I hope that the noble and learned Viscount will not regard this as a matter of principle but will be able to see his way to meeting this particular—I should imagine very limited—class of case. I beg to move.

Amendment moved— Page 6, line 39, after ("mother") insert the said words.—(Lord Silkin.)

LORD PETHICK-LAWRENCE

I should like to say a word on this Amendment as a result of personal experience. I know that lawyers and those who go by the letter of the law are of opinion that when a landlord seeks to obtain possession by the statement that a property is wanted for one of his own relatives there is in fact no likelihood that that statement will be a mere ruse; but a landlord obtaining possession on that account is committing a contempt of court if, having made, in a court, a statement to that effect, he then puts a relative into the property for about a week and subsequently sells it. But as a matter of fact there is no machinery by which that contempt of court will be brought to action. I know a case of a tenant who was turned out of premises in which she was living by a landlord who claimed that the property was wanted for a son. The son was put into possession for about a fortnight. He then gave up possession and the property was sold. That was really the reason for which the landlord wanted the house. I put that forward to-day in order that I may support the argument which has been made by my noble friend that at any rate the tenant's needs should be considered and that the landlord's claim to the use of the premises for some relative should not aways prevail.

LORD MESTON

I do not quite understand why the noble Lord, Lord Pethick-Lawrence, has taken that point, because that matter was discussed in another place and it was made perfectly clear that the owner had genuinely to sign some agreement, memorandum or note of the transaction that was about to take place. It was not enough to say that such a transaction had been made; there had to be visible evidence of it. Surely the position is that if this matter came before the court under this Bill and it was proved to the satisfaction of the judge (and, after all, we are not giving the judge very much credit under this Bill) that the landlord had entered into some purely bogus arrangement in order to avoid having to give an extension of time to his existing tenant, the court would, I am quite satisfied, set aside any such bogus arrangement as has been envisaged by the noble Lord who had just spoken.

THE LORD CHANCELLOR

I adopt the argument of the noble Lord, Lord Meston, in so far as it relies upon the experience and knowledge of human nature of the county court judge. The noble Lord, Lord Pethick-Lawrence, put forward the further argument that it was difficult to enforce such a sanction here because, as I understood his argument, although it might look very queer if people should go into the house for only a fortnight and it were then sold, and although it might appear that perjury had been committed, it might be difficult to prove that they had committed any breach, as people had actually gone into the property. Looking back to the days when I had to advise on prosecutions, I must say that I should myself have been prepared to take quite a tough line in advising a prosecution in such circumstances, and I believe that in a great many cases there would be some further extrinsic information which would show that the arrangement was bogus. But I appreciate the point.

LORD PETHICK-LAWRENCE

The point I was making was that no doubt if action were taken it might be possible to prove that; but who was to take action? The tenant had been turned out and had had to find other quarters and there was no one whose business it was to set the action in motion, with the result that the landlord "got away with it."

THE LORD CHANCELLOR

The tenant could go to the police; and if I were advising the police I should take a tough line, for I can imagine no more despicable offence than getting someone out of a house by perjury and trying to cover it up. It is an offence of which I myself take a very poor view. On the other hand, county court judges have had so much experience of this problem that they have a very good "nose" for duplicity in these circumstances.

On the general aspect, I believe that the noble Lord, Lord Silkin, made a very disarming point when he asked: "Why are you putting the contractor in a better position than the landlord?" I would ask him to follow me—I am sorry to be taking some time—so that I may show him what the difference is. If he will look at Clause 3 (6) (a) he will see it provides that the suspension of an order for possession cannot be granted beyond the date on which the owner is obliged to give vacant possession to a purchaser or tenant, if the court is satisfied, first, that the premises are required for his own occupation or for that of his parent or child. That is the first point: it is limited to himself, his parent or child.

The second point is that the agreement under which such succession has to be granted was made or evidenced in writing before April 2, 1958. That is the point I would ask the noble Lord, Lord Pethick-Lawrence, to consider. April 2, 1958, is the date on which this Bill was announced. Therefore, the agreement must have been made and, as the noble Lord, Lord Meston, pointed out, must have been evidenced in writing before there was any question of this provision being announced. I think that means that the chances of a fraudulent application are diminished, because unless those concerned are prepared to go as far as to commit forgery, as well as perjury, by producing a falsely dated document it is not likely that the transaction will be fraudulent. I think that the noble Lord, Lord Pethick-Lawrence, will agree that many people who do not worry too much about a little perjury do, in fact, worry when it comes to producing a forged document and publishing it. These are the requirements, and if the noble Lord's Amendment were accepted it would prevent the suspension only where it could be shown that, in addition, greater hardship would be caused by granting suspension than refusing it.

The reason for the provision in the Bill is that before April 2, 1958, a person might reasonably have contracted to buy or rent a house for his own or his family's occupation, and he would expect to get possession on or after October 6, 1958; and, of course, he would probably have taken steps to give up the accommodation he was occupying and would on that account be in a serious position. I do not think one can argue that an incoming purchaser or tenant who was prepared to see the sitting tenant displaced in his favour deserves no sympathy on that account. One must take into consideration the whole atmosphere which existed in March of this year. I think that everyone would agree that some provision ought to be made, and the question is: Ought we to have adopted the provision suggested by the noble Lord, Lord Silkin?

Here, if one tries to consider the extent of the provision, the class of person who can invoke this must be very limited indeed, because only those purchasers or would-be tenants who have a really strong case for consideration can come under the two requirements: that they have made the agreement before April 2, 1958, and that they want the tenancy for themselves, or for a parent or child. I have given the necessities which the prospective purchaser must prove. The provision excludes a purchaser who wanted to sell or let at a profit to someone else—I think one must take that from these two requirements. If he has made an agreement before he knew of this Bill to take it for himself or for a member of his immediate family, one cannot really put it against him that he has taken it with the intention of selling at a profit. That is the answer I make to the very important point raised by the noble Lord, Lord Pethick-Lawrence.

To the noble Lord, Lord Silkin, I would say this: that the test is stricter than it is for an ordinary owner under Clause 3 (1) (d), because one could prevent a suspension on the grounds of greater hardship, which is not limited to possession for one's own occupation. The case of greater hardship, though it is likely to exist more in the case where one wants possession, is not so limited, and so we are taking a stricter case here. I think there are two arguments which one has to face. It can be argued that the Amendment puts the purchaser or would-be tenant in the same position as regards preventing a suspension as the owner of a controlled house who wants to regain possession for his own occupation—the ordinary Rent Act case. If the parallel with the 1933 Act is raised, it can fairly be argued that that is not comparing like with like. In the one case you are taking a controlled house where the tenant is entitled to security of tenure; in the other, under the present Bill, you are dealing with a decontrolled house.

I have thought that a more damaging comparison would be with the position under the Bill of the owner who wants to regain possession for his own occupation. I think that the answer, if that comparison is to be drawn, is this. One gets the position, which noble Lords opposite have not been ready to recognise; that if the Bill errs it errs in not being more generous to owners requiring a property for their own occupation. It can be pointed out that if the Amendment were accepted, the purchaser who has yet to complete would be, as I said, in a substantially worse position than an owner seeking to retain possession. The owner will succeed if he can defeat the occupier under Clause 3 (1) (d) by establishing that the greater hardship would be on his side. He does not have to show, in addition, that he requires the premises for himself, his child or his parent. Possession may be required for the occupation by someone outside this narrow group, such as his brother or sister or wife's parents—these are all ordinary examples—and he can show it in that way. Therefore, I think it is fair to say (I am sorry to have spoken for so long), that we have taken a narrower case; indeed, it demonstrates that we have not been too ready to let the owner into occupation, but we have tried in this limited way to deal with the person who has made a contract and now finds himself in a difficulty.

May I say just one final word? I think it is unfortunate that the three Amendments which I have had to resist have all come together. I should like to raise some joy on the faces of the noble Lords opposite by saying that the next Amendment which I have down is in answer to a point raised on Second Reading by the noble Lord, Lord Silkin. I have done my best to meet him there, so I hope that he will forgive me for resisting this point.

LORD SILKIN

I fully agree with the noble and learned Viscount that I have had a very bad afternoon, as all my Amendments have been rejected, but I should like to say one final word on this one. The noble and learned Viscount pointed to the case of a person who had entered into a contract before April 2 because he had every reason to anticipate that he could get possession, say, in October. He wanted the premises for his son who was about to get married, or for himself, and in expectation of his being able to get possession he had deprived himself of his own dwelling, or his son of his. I should have said that that case was fully covered by the Amendment, because in those circumstances his hardship would have been greater than the hardship of the sitting tenant. In his case he has had to find a sum of money—possibly getting into debt with a mortgage—and in good faith has given up his own dwelling-house. He would have no difficulty in convincing any judge in this country that his hardship was the greater. Therefore I do not really follow why the noble and learned Viscount need fear accepting this Amendment because of that kind of case.

I fully accept the fact that the test here is more favourable to the tenant than it is to the landlord who is not sitting, and it may involve some modification of the Bill to put that right. I should be happy to discuss with the noble and learned Viscount an appropriate modification which would put both parties on the same footing. That was the intention. The noble and learned Viscount has pointed out a defect, but it is only a defect in wording, and one can get over it if we accept the principle that it is the tenant's hardship that we are trying to alleviate—a hardship caused by sudden decontrol. By this Bill we are trying to alleviate the hardship caused to the tenant if his hardship is greater than the hardship to the person who has bought the premises. He has possibly bought the premises as an investment—it does not follow that he has not. If a person has bought premises as an investment, there would be no hardship for him to have to wait a little before getting possession. I feel that this again is an Amendment that might be considered, and while not asking the noble and learned Viscount to give assurances I hope that it will be considered. I do not think that this is a question of principle upon which the Government cannot possibly give way; and in that hope I give notice that I will come back to it at a later stage.

THE LORD CHANCELLOR

Again only on principle, I say that I feel this difficulty. The noble Lord has put the point very attractively again, but, to take his own example, suppose someone, in January, 1958, six months after the Act is passed, buys, for his son to live in, premises that he believes are going to be decontrolled on October 6th, 1958. Then, in April, he is caught out by the Act. The tenant says: "Well, I am here. These are the premises. I have been in them all my life. I have tried, but I have not been able to find new premises." I think that that is exactly the sort of hardship which will be balanced. I feel that the additional point that the contractor has is that his contract has been caught out by a much later Act, when the old position has been changed. That is the difficulty I feel, and again I tell the noble Lord how my mind is working. I do not want to raise any false hopes, but, of course, once again anything that he says will be considered.

On Question, Amendment negatived.

Clause 3 agreed to.

Clause 4 [Supplementary Provisions]:

THE LORD CHANCELLOR moved, after subsection (1) to insert: (2) In proceedings for the recovery of possession of a dwelling-house in which a suspension of execution is granted or refused under section three of this Act (including any application under that section arising out of the grant of such suspension) the court shall not have power to make an order for costs except—

  1. (a) where a suspension of execution is refused or revoked in pursuance of paragraph (b) of subsection (6) of that section; or
  2. (b) where it appears to the court, having regard to the conduct of the parties respectively in and in connection with the proceedings, that there are special reasons for the making of such an order."

The noble and learned Viscount said: This is the Amendment which I have put forward to meet the point which the noble Lord, Lord Silkin, raised on Second Reading and which I promised that I would consider. The effect of the Amendment is that, subject to two exceptions, the court will have no power to make an order as to the costs of any proceedings for the recovery of possession of a decontrolled dwelling in which the grant of a suspension under the Bill is in issue, or of any proceedings resulting from an application by the occupier for an extension of the period of suspension under Clause 3 (4) (a), or by either party for a change in the specified rent under Clause 3 (4) (b). The exceptions are, first, where the court uses the discretion given to it by Clause 3 (6) (b) to refuse or revoke a suspension of execution on any ground on which possession of a controlled house can be given under the Rent Acts; and, secondly, where it appears to the court that there are special reasons for making an order in the light of the conduct of the parties in, and in connection with, the proceedings. The noble Lord, Lord Silkin, will be perfectly familiar with that. That is merely preserving the right of the court to use costs to penalise someone who has committed something in the nature of an abuse of its process. I put it quite generally, but the noble Lord is very familiar with that.

I think this meets the point which the noble Lord had in mind and which a number of honourable Members in another place bad in mind, namely, that the fact that a house was decontrolled meant that the landlord could therefore get an order for possession or there could be one for suspension, and it might be thought that the costs should follow the event of that part of the case and that he should get at any rate the costs of that issue of possession. Then one might be in difficulties in saying how much of the costs should be attributed to the issue of possession and how much to the issue of suspension. I have tried to meet that by the provision that the court will not make an order for costs except in the circumstances which I have already detailed.

We could have an interesting discussion, and I am sure that the noble Lord, Lord Meston, could argue with complete success that on the principle on which costs are awarded, as in the cases of Richards v. Godfrey and Campbell v. Pollock, with which we used to be so familiar, this provision is really unnecessary, because in following this procedure the courts may well arrive at this result. But that is not sufficient: we must make sure that in a Bill which we all desire should prevent hardship no one should be frightened out of the remedy for that hardship through fear of costs. That is why I have met the noble Lord, and I hope that he is reasonably satisfied. No one can be entirely satisfied with someone else's rhetoric, but I have tried to meet him and to deal with the problem. I beg to move.

Amendment moved— Page 7, line 18, at end insert the said subsection.—(The Lord Chancellor.)

LORD SILKIN

Of course, I am grateful to the noble and learned Viscount for the consideration he has given to the point I made, for reading a note I sent to him on the subject and for going so far as he has done in putting down this Amendment. I think that it fully meets one part of my case. I think that he can meet the other part by administration, and, if he will not mind, I should like to put it to him. The big landlords are able to employ skilled professional assistance—counsel, solicitors and so on—and tenants may feel that unless they are equally represented by counsel they do not stand a chance. I made the point on Second Reading, that most people coming before a court—indeed, most people who have to stand up and make a speech, unless they are experienced—are incoherent and inarticulate; and they feel that if their case comes before a county court judge, they must employ professional assistance.

The suggestion I made to the noble and learned Viscount was that these cases should be dealt with by a registrar in Chambers, where there will be informality and people can say what they feel without requiring to be assisted by counsel. For reasons which I need not go into, but which the noble and learned Viscount was good enough to put to me and which on the whole I accept, that course is not desirable as a general rule. But it could be done, and I suggest that it might be done, where both parties agreed to their case being dealt with by the registrar. That would save both parties costs. But, in the other cases, could the noble and learned Viscount not devise some way by which it could be understood and recognised that parties should be encouraged to attend personally, if they so desire, without feeling that they must have skilled professional assistance? I may say, from the lawyers' point of view, that they would be delighted not to have to represent people in these matters. There is no money in it. The fees they normally expect are far higher than these cases would justify, and nobody would be disadvantaged if it could be made clear that no party would suffer by attending personally. If that were possible, I think the whole of my case would have been met. While I do not expect the noble and learned Viscount to be ready with an answer at once, I think that it is something that could be dealt with administratively—perhaps by some kind of circular to the county court judges. Subject to that, I welcome this Amendment and I am grateful to the noble and learned Viscount for putting it down.

THE LORD CHANCELLOR

As the noble Lord has said, all he expects from me is serious consideration of this point. The answer does not immediately leap to the mind, but I promise him consideration. I am grateful for what he has said.

On Question, Amendment agreed to.

LORD STRATHCLYDE

In the Amendment which has just been moved by my noble and learned friend and which has been accepted by the House, appear the words "to make an order for costs." In Scotland, we do not use the word "costs" but the word "expenses", and the purpose of this Amendment is merely to insert in the subsection which applies the clause to Scotland the words "'costs' means expenses". I beg to move.

Amendment moved— Page 7, line 40, after "Scotland" insert "'costs' means expenses".—(Lord Strathclyde.)

LORD LATHAM

Another injustice to England!

On Question, Amendment agreed to.

Clause 4, as amended, agreed to.

Remaining clause agreed to.

House resumed.