§ 4.32 p.m.
§ Order of the Day for the Second Reading read.
§ LORD TANGLEY
My Lords, I am well aware that to divert your Lordships' attention from the excitement of a dog's life to the humdrum routine of a solicitor's life must necessarily be something of an anticlimax. Yet I must do this, because the professional life of solicitors is largely governed by statutory provisions, and as conditions change, so it is necessary from time to time to invite Parliament to change the legislative framework to keep pace with the social changes that are going on all the time. That is really what I am inviting your Lordships to do this afternoon. The last time your Lordships had an opportunity of considering the case of solicitors was nine years ago, in 1956. That Bill was followed by a Consolidation Act in the following year, 1957. Apart from one quite trifling amendment in 1959, there has 1116 been no legislation since 1957. Therefore, it is necessary to ask your Lordships, if I may put it in this way, to bring the law up to dale.
May I say one word about the drafting of this Bill? It looks longer than it really is. The reason for this is that instead of merely trying to insert a phrase here or a phrase there into the Consolidation Act, we have, so far as possible, in drafting the Bill, where we have amended a section, repealed the section and re-enacted it as amended. That may make the Bill a little longer, but it makes it much easier to construe in years to come; and I hope your Lordships will feel that the solicitors have set a virtuous example in this respect.
I should like to say how grateful I am to have the countenance of the presence of the noble and learned Lord on the Woolsack, his predecessor, the noble and learned Viscount, Lord Dilhorne, and the Master of the Rolls, the noble and learned Lord, Lord Denning; and I hope that before the proceedings have finished the noble and learned Lord, Lord Parker of Waddington, the Lord Chief Justice of England, will be here, too. The holders of these three great offices of State bulk largely in this Bill, and I should like to thank them not only for being present here to-day but also for the help which solicitors have had from them in the past. During the 28 years that I was a member of the Council of the Law Society, with my colleagues and members of the staff, I must have had innumerable meetings with the holders of these great offices. I cannot pretend that I always came away from those encounters with a feeling of unqualified satisfaction, but, none the less, we knew that we should have sympathetic and understanding treatment; and we have always had it.
I think this Bill can most conveniently be considered as dealing with five separate matters, as follows: education and training; the Compensation Fund; certain preventive provisions; certain provisions about the Disciplinary Committee; and certain consequential and procedural matters. I believe it will be for the convenience of your Lordships if I deal with them in that way.
Education and training is just as important for solicitors as it is for dogs—in fact, more important. One of the great difficulties one has is to combine 1117 —and this applies not only to the solicitors' profession but, I think, to all professions—a general education with the necessary vocational or professional training, and to decide how within the scope of that vocational training one can best combine the academic and practical elements which, certainly so far as solicitors are concerned, there must be. After all, for a solicitor it is not sufficient only to know the law; he must also know what to do and how to do it. All these things have somehow or other to be combined, and the training has to be finished, let us say, at least before the student reaches middle age. The gap between biological and technical maturity is already too great to-day, and it is something that we must always recognise.
The system of training for solicitors is changing quite fast It is very different from what it was when I was articled, which was 50 years ago this year. Then the normal system was fairly standardised. You had to have a certain educational standard. You served five-years articles, which could be reduced to four years for certain things. You passed an intermediate examination at the end of the first year, and then a final examination at about the end of your articles. If you had a degree from a university, then the period of articles was reduced to three years; and if you had a law degree, you got exemption from the intermediate examination as well. But these exemptions were the exception in those days, and the five years' period of articles was the rule. There were no Government grants then, of course. You had to pay a premium to your principal to be allowed to serve in. his office, and there was no sort of pay while you were serving under articles.
Things are very different to-day. Social changes have led to what is really quite a new system. Sixty per cent. of the entrants to-day come with university degrees and, therefore, serve no more—though sometimes they serve less—than three years. Very few solicitors ask for a premium in these days; that is a dying custom. Most solicitors pay their articled clerks during their period of service. The Intermediate Examination has been abolished and has been replaced by the division of the Final Examination into two parts: the first, a general examination in the law from which a university law degree exempts, and then the second 1118 part, a specialised examination with a wide choice of specialised subjects. Then there is attendance at law school.
The result of all this is that it is possible to get through to-day with only two to two and a half years' practical experience. In almost all cases the newly admitted solicitor needs, and usually gets, further practical experience as an employee before being really fit to practise on his own or to become a partner. Although he is still called an articled clerk, the articled clerk is rapidly becoming a different kind of animal from what he was when I was an articled clerk. His life really is divided into three parts: first of all, his academic life; secondly, his practical and vocational training with some kind of pay, and thirdly, the further experience he gets after qualification at a higher rate of pay. I think the Law Society are to be congratulated on the adaptations that have already been made to these rapid changes. But much more remains to be done, and I believe it is necessary to proceed experimentally step by step.
I do not believe we shall get the right final answer all in one move. Here, the Law Society and the profession are handicapped by the fact that the legislative system governing the training of articled clerks for their examination is a mixture of Statute and regulation. Some of the items can be dealt with by regulation made by the Law Society (with the approval, of course, of the three Judges I have mentioned). Some of the changes would require the Law Society to come back to Parliament from time to time and ask for changes in the Statute law.
The first change, therefore, that is being asked for by the Bill—and I suggest to your Lordships it is a reasonable and constructive one—is that all these matters might be dealt with by regulation instead of partly by regulation and partly by Statute. That covers the first three clauses of the Bill and, with it, Clause 6 (1) (a) and (b), which deals with the conditions which the Law Society can attach to a practising certificate given to a young man who has had only two or two and a half years' actual experience in an office.
Looking at Clause 6 (1) (a) and (b), I am not quite happy about the drafting of it. I think it may be construed as authorising the Law Society as registrar 1119 to refuse a certificate altogether. That would be unnecessary, and going too far. If it has that meaning, then it should be amended, and if your Lordships are good enough to give a Second Reading to this Bill then perhaps we could deal with that on a later occasion. That is what I wanted to say in justification of the clauses about education and training in this Bill.
The second item is the Compensation Fund. The Compensation Fund, as your Lordships know, is a voluntary fund established by the solicitors' profession, contributed to by solicitors, out of which compensation is paid to the victims of those very rare but very sad cases where solicitors defraud their clients. It is called a Compensation Fund because it is for compensation. It is a discretionary fund. There is no legal right to make a claim upon it. We have never called it an indemnity fund, but in fact all admitted claims have been paid. The money comes from a contribution of £10 a year from every practising member of the profession, and that has proved adequate over the years to meet the ordinary run of claims. But the Fund, I must admit, has had some very narrow escapes with the big, rare, deliberate, frauds which sometimes take place.
The great problem which has been exercising the Law Society is what is the best way of building up a reserve which would meet those big cases. Should one increase the normal contribution of £10? How can one tell what the increase should be? It may be too big, in which case too big a fund would be built up. It may be too small, in which case your problem would remain unsolved. No actuarial computation is possible with regard to claims upon this Fund.
Therefore, the proposal hit upon by the Law Society, and included in this Bill, is that the present contribution payable by everyone should not be changed, but that there should be a right on the part of the Law Society to make a levy on every solicitor, with certain exceptions, of a maximum of £50 in any one year. There would be no levy made in the case of a solicitor who does not handle clients' money, such as an employed solicitor, a local authority solicitor, or a Government Department solicitor. There would be no levy made for the first three years of 1120 a solicitor's life, and the levy for the next three years would be only half the normal rate. May I say that this is only, so to speak, a reserve power. There is No 1ntention of making such a levy at all if it can be avoided. There is certainly No 1ntention of making any sort of annual levy. In fact, if things go on in the future as they have in the past, it should not be necessary to make this levy at all. It is merely putting the whole resources of the profession behind the Compensation Fund as a reserve.
I am glad to tell your Lordships that this proposal has the very strong support of the profession. The idea was circulated to the provincial Law Societies nearly a year ago. They have had ample opportunity to consider it. They did consider it, and discuss it, with representatives of the Law Society at a conference held last summer, and the only amendment they suggested was this: whereas the Law Society had originally suggested a maximum of £40, the rank and file of the profession thought it was better and safer to increase that limit to £50. I can assure your Lordships that this proposal has the overwhelming support of the profession, after the profession had an opportunity of considering it thoroughly. Having got this reserve, if your Lordships will give it to us, it is felt that a long-desired extension of the type of case that could be met out of the Compensation Fund is now feasible: that is. the case of a person who suffers loss, not because of any actual fraud or dishonesty on the part of a solicitor, but because of undue and unexplained delay. Clause 16 of the Bill includes that as an additional category. Again I think it may be necessary to look at the drafting of that clause when we come to a later stage of the Bill, if your Lordships give it a Second Reading to-day.
I think I need say no more about the Compensation Fund, but may I say a few words about what I call the preventive provisions of the Bill? We have an elaborate code of discipline. We have the Disciplinary Committee; we have the Compensation Fund, to which I have already referred, but, what is far better than that, far better than either of those things, is to see whether one cannot prevent loss to clients arising at all. Of course, the Law Society over 1121 the years have been given by Parliament very wide powers of interference with solicitors, with the object of preventing loss from occurring, and in this Bill we have quite a number of clauses which carry a little further the existing powers of the Law Society in those respects. Most of these provisions, I think, are details of procedure and machinery of application for the issue of practising certificates and the conditions which may be attached to a practising certificate. Clauses 4, 5, 6 and 7 relate to practising certificates.
I think that I ought to draw your Lordships' attention to two specific points, particularly on Clause 5, which should be taken with Schedule 2. The Law Society have power at the present time to charge a maximum fee of £5 for the issue of a practising certificate, which is an annual certificate. It is proposed to increase that figure to a maximum of £20, the actual level to be approved from time to time by the Lord Chancellor, the Lord Chief Justice and the Master of the Rolls. That may strike your Lordships as being a somewhat startling thing, but I have looked at the accounts of the Law Society, and at their budgets for the next five years, and I am afraid there is no doubt that some substantial increase in the certificate fee will be necessary. I do not think that £20 or anything like it, will be necessary. I doubt very much whether a case could be made, on application to the three Judges in question, time. That is merely a maximum.
In order to follow these points I think I must just tell your Lordships a little about the way the Law Society work. The functions of the Law Society apart from their statutory functions under the Legal Aid Scheme, are fourfold. First of all, there are statutory powers and duties, which are very onerous and very expensive; secondly, the law school and legal education generally; thirdly, activities on behalf of the profession as a whole, including, I may say, a great deal of public work in preparing evidence for Royal Commissions and departmental committees and other such bodies; and, fourthly (this is really quite a minor matter), the running of a club, with the usual club facilities, in London The expenditure 1122 of the Law Society covers those four different kinds of function.
The Law Society are, of course, incorporated by Royal Charter. Membership is voluntary, although the vast majority of solicitors in practice are, in fact, members. There is power under the 1957 Act, by order, to put compulsory membership into force with the approval of the Lord Chancellor, but that has never happened and I deeply hope that it never will. I think that voluntary membership is by far the best thing for everyone concerned.
The Society's income comes, first of all, from members' subscriptions; secondly, from examinations and law school fees; and, thirdly, from the fees for practising certificates and certain other documents. The club activities are meticulously paid for entirely out of members' subscriptions; and examination and law school fees go entirely towards legal education. All statutory duties, and the activities on behalf of the profession as ! a whole, have to be paid for out of the practising certificate fees. And much of the legal education, which is not self-supporting, has to be paid for in the same way.
I have told your Lordships that, as things stand at the moment, the Law Society will soon be running into a heavy deficit, so that an increase in this fee is inevitable. Which is the better way of doing it: to have to come to Parliament frequently, or to fix a maximum and leave the three Judges to decide from time to time what increase, if any, is necessary? I am pleading for the second course. There are many safeguards. Accounts have to be submitted to the Judges annually, and they have to be made available for inspection by any solicitor. One would have thought that the scrutiny of these three Judges was a sufficient safeguard. There is no public money involved here; we are dealing merely with payments to be made by solicitors.
The other matter I must mention to your Lordships, arising out of this clause, is the statutory provision which exists to-day about the division of the Law Society's income. Under Section 11 (2) of the 1957 Act it is provided that, of the £5 fee, 5s. should be applied to the 1123 Law Society's own use, and that the remainder should be applied:(a) in such manner and to such extent as the Society may consider necessary, towards the expenses of law schools provided or approved by the Society; and(b) subject thereto, to such other purposes of this Act as the Society may think fit …".Those wordsthe expenses of law schools provided or approved by the Society;are not wide enough to-day to describe properly what the Law Society does in the matter of legal education. It would not cover, for example, the refresher courses run by the Society; special courses of lectures, or week-end courses, such as those which have been held on the Common Market and Common Market Law. It is proposed, therefore, to substitute the wordsthe facilitating of the acquisition of legal knowledge".That phraseology goes back to the actual wording contained in the Law Society's own Charter.
It is proposed also (and this perhaps needs a little more close attention) to abolish the statutory provision that only 5s. may be applied to the general purposes of the Society. Inevitably, in the nature of things, by far the largest part of the fee income must be absorbed in the statutory functions of the Law Society and legal education. Must one, every time there is a change in the level of contribution, do the arithmetic needed to secure that precisely 95 per cent. is spent in that way and only 5 per cent. for the general purposes of the Law Society? Here again the proposal is that the matter should be subject to the control of the three Judges. This is a very desirable safeguard, although I do not think it is a necessary one, because the record of the Law Society in public service and legal education is such that we would confidently claim that the Society can be well trusted by Parliament to make a proper division of their expenditure on their own account. But that is not asked for in this Bill. There is the safeguard that the three Judges should decide; and obviously it would be impossible to go to the three Judges and ask for an increase in the fees unless one were in a position to establish the purposes for which that increase was required and for which it would be spent.
1124 My Lords, there are a few other minor matters, in Clauses 6, 8, 9, 10, 12, 13, 14 and 15, which are all extensions of the power of the Law Society to step into a solicitor's practice to prevent client losses. The clauses extend those cases where it has been found that there are certain gaps. I need not draw your Lordships' attention particularly to any of the provisions in these clauses, but if any noble Lord wishes me to explain them, either to-day or on some subsequent occasion, I shall, of course, be glad to do so. Clauses 12, 13, 14 and 15 apply to a solicitor practising alone on whom some calamity falls, and they would enable the Law Society to do what the other partners, the surviving partners, of the solicitor would do if he were practising in partnership. Clause 12, for example, authorises the Law Society to take control of the practice on death. Clause 13 entitles the Law Society to work the clients' account before probate. Clause 14 enables the Law Society to step in where there has been no probate or administration taken out within three months. Clause 15 provides that a certain kind of freezing order should be treated as an act of bankruptcy.
The only two of those clauses I want to comment on are No. 14 and No. 15. I am bound to tell your Lordships that the Senior Registrar in the Probate Division of the High Court does not think that Clause 14 is necessary; he believes that the matter could be dealt with under existing legislation, Section 162 of the Judicature Act. I would ask your Lordships' permission to reconsider that point before Committee stage and to speak further about it then. Clause 15, I must confess, gives me a certain amount of anxiety myself. Whenever you step in to do something for the clients you run the risk of being unjust to the solicitor. And here the President of the Board of Trade has pointed out that we are making something an act of bankruptcy which does not necessarily imply the existence of a debt, still less an unpaid debt, and it may be that there one is being unfair to the solicitor. Again, I should like to have an opportunity of reconsidering that before the next stage, but my present inclination is to ask your Lordships to omit that clause from the Bill.
The fifth matter—and I am coming very nearly to the end—is that there are 1125 certain points about the Disciplinary Committee. I think Clauses 20, 21 and 24 are those I should mention. First of all Clause 20. The quorum is three, and this clause proposes that if one of the three is absent, as may very well happen—a provincial solicitor coming from the North, held up by snow or fog or illness—then the other two should be entitled to say to the parties, "Do both of you want to go on or do you prefer to wait until our third colleague can be here?" This is entirely for the benefit of the parties to the litigation, who may have their witnesses, documents, counsel, solicitors and everybody necessary there.
There was, I am bound to tell your Lordships, a clause dealing with this subject in the 1956 Bill which was rejected in another place. There the matter was dealt with differently because it enabled the Disciplinary Committee to say, "We are going on hearing this with only two, unless either of the parties objects". That is a much more embarrassing statement, I think your Lordships will agree, to be put to an advocate than the statement proposed to be put under the clause as drafted in this Bill.
Clauses 21 and 24 say that an application to reinstate a solicitor who has been struck off or suspended may be heard by the Disciplinary Committee, with an appeal to the Master of the Rolls, instead of its being made directly to the Master of the Rolls as is the case under the present law; and I believe the Master of the Rolls sees no particular objection to the use of that procedure.
That is all I have to lay before your Lordships upon the Bill as it stands, but there is one final matter I think I ought to mention. That is a decision which has recently been come to in your Lordships' House, sitting in its Judicial capacity, in the matter of Brown v. Commissioners of Inland Revenue. That in form was a tax case and it came from Scotland; but, none the less, in spite of those two disadvantages it has led to a decision which is binding on all solicitors everywhere. It is a very awkward decision, I am bound to tell your Lordships, because, while entirely accepting the decision of the House of Lords in its Judicial capacity, the profession is in this position: that it cannot carry out the law. It is not practicable to carry out the law. As things stand, there is an impasse: the law says do one thing; practice says that 1126 it is impossible to do it. It arises out of the question of what is to be done with interest earned at the bank on clients' money held in the clients' account if it is put on deposit and earns interest.
I should like to pray in aid what the noble and learned Lord, Lord Upjohn, said about this matter in the course of his Opinion:I reach this conclusion with some regret. The practice whereby a solicitor uses his clients' money, too small in individual amounts or held for too short a time to make an individual investment worth while in the interest of the client, but which in the aggregate amounts to a large floating sum, to earn interest for him is an entirely innocent and common sense practice which harms no one and probably indirectly benefits the general body of clients.Unfortunately, in view of what your Lordships' House was constrained to say, if interest is earned in those circumstances the most elaborate calculations must be made and the interest apportioned among the various interests. This is not practicable and I will ask your Lordships at a later stage to consider a clause which I hope will remove the impasse between a perfectly right decision, one which is accepted throughout the profession as right, and a perfectly impossible practical situation. It is a situation which certainly ought to be resolved, and I shall give your Lordships the opportunity of doing it at a later stage in the Bill. I am not going to keep your Lordships any longer. I hope that I have adequately explained the main provisions of this Bill. I beg to move that the Bill be now read a second time.
§ Moved, That the Bill be now read 2a.——(Lord Tangley.)
§ 5.8 p.m.
§ VISCOUNT DILHORNE
My Lords, I am sure that your Lordships are grateful to the noble Lord, Lord Tangley, for the way in which he has expounded the provisions of this Bill. I must confess, and I think your Lordships will agree with me, it is not easy to perceive, just from reading it, what its effect will be. I fully appreciate that the way in which it has been drafted will make the task of consolidation very much more easy, and it is obviously drafted in that way in contemplation of the possibility that a Consolidation Act will follow shortly after this Bill reaches the Statute 1127 Book, as indeed happened in 1957. I hope that the noble and learned Lord the Lord Chancellor may perhaps be able to say that the process of consolidation of this Bill, when it becomes an Act, with the 1957 Act can be, and will be, very speedily accomplished.
The Bill deals, as the noble Lord has made clear, with a wide variety of matters. But before I comment on any of those I should like to pay a tribute to the Law Society, who have the responsibility, subject to Parliament, for managing the affairs of solicitors, upon the way in which they have tackled these difficulties and are seeking to bring the law in relation to solicitors up to date, not only for the purpose of providing better training and education for the young man and facilitating learning of the expertise of the profession, but also, as this Bill proposes, for extending the benefits to the public and the security of clients of solicitors. I give my support, for what it is worth, to the provisions contained in the Bill. There are, however, one or two of them on which I should like to say a few words. I will deal, if I may, with the subjects in the same order as the noble Lord dealt with them.
He dealt first with education and training, and I think he made out an overwhelming case for replacing the present statutory conditions with regulations. Regulations permit of much more flexibility; they are far easier to change. I listened with interest to the noble Lord's observation—I cannot quote his words—when he said that he did not think that the right answer had yet quite been found. It is a continuous process. As new developments take place, as new burdens are cast upon lawyers by what happens in this House and in another place, so the process of education and the system of training must constantly be reviewed and brought up to date. I think that the provision of regulations instead of statutory conditions is an important change and will aid in that respect.
I have always been keen—I have said so on a number of occasions in your Lordships' House—on seeking to develop not only a modern but, so far as possible, a common system of education between the two branches of the profession, so that those who first became solicitors might, if they thought 1128 that the other branch was more suitable to their qualities, fairly easily have changed to that branch, and vice versa. I believe and trust that the replacement of these statutory conditions by regulations may perhaps help that, too, to be accomplished.
The noble Lord drew attention to the possible amendment of Clause 6, which he said might be construed as enabling the Law Society to refuse to grant a practising certificate. I cannot express any view upon that—I have not myself considered the point—but what I should like the noble Lord to do, if he is considering an amendment to that clause, is to consider another point in relation to it which gave me a little concern. Under that Clause 1t is possible to refuse the grant of a certificate without conditions not only on the first application of a newly-admitted solicitor, but on subsequent applications by him, if he has not held a practising certificate free of conditions since the date of his admission. That is Clause 6 (1) (b). I do not for a moment suggest that the Law Society would do it, but if I understand the matter correctly, year after year and for an indefinite period a newly-admitted solicitor might be refused a certificate free of conditions. I am sure that is not the intention and that that would not be done, but I believe it would be an improvement of this clause to insert some limiting period for the imposition of conditions of that kind in respect of the newly-admitted solicitor.
I am not suggesting that there should be any limit prescribed in the other cases to which that power applies, but I think the case made out for this in relation to newly-admitted solicitors was the fact that they can now manage to qualify in two and a half years; and that does not give them sufficient practical experience. I am sure that it is right and proper in their own interests to provide that they cannot act on their own and go into partnership immediately upon admission until they have had that practical experience, and I trust that it would be an improvement in this Clause 1f, when he comes to consider amendments, the noble Lord would put down a limit in relation to newly-admitted solicitors for the time during which the practising certificate must be subject to conditions. I hope 1129 that the noble Lord will not take my suggestion in any way amiss; it is put forward merely with a view to improving the Bill.
I turn to the Compensation Fund. Here again, I should like to pay a most sincere tribute to what the Law Society have done. I think they have set a great example to other professions which handle clients' money. It is a great thing that this Compensation Fund should be contributed to, and indeed be totally provided, by other members of the profession. On; naturally hopes that the claims upon it will always be few, and that in the course of years they will be reduced. But it is the fact, as I think a great many of us know, that unfortunately from time to time that fund has been called upon to meet, and has had to meet, substantial liabilities. I think it is most remarkable that the noble Lord is in a position to say that any admitted claims have been paid in full.
I do not think that any of your Lordships will take the slightest objection—at least, I trust net—to the Bill's containing this power to impose a levy to replenish that Fund should that necessity unfortunately arise. Again, I do not think that anyone would have anything but praise for the fact that the Law Society, on their own initiative, are coming forward with a proposal to extend a power to pay out of that fund where there has been a loss because of undue and unexplained delay upon the part of the solicitor. I do not propose to say much about the fee in relation to practising certificates. Quite clearly, the need for an increase of the fee has been made out, and I have no doubt that the Law Society will keep the fee as low as they possibly can having regard to their other commitments.
I should like now to turn to what the noble Lord referred to as "the preventive provisions". Again I have no doubt that they are fully warranted. On reading the Bill I felt somewhat concerned about the particular provisions in relation to the solicitor acting on his own—I refer to the provisions which apply in the event of his death and as to control of the solicitor's practice. On first reading of the Bill they look to be somewhat drastic; but then one realises that the only effect of what is provided for here is to make the Law Society, as you might say, the partner of 1130 the single solicitor at the moment of his death: and the automatic partner, the Law Society, then acts as a partner. I think that these provisions are right, fully justified and desirable in the public interest and in the interests of the clients of that solicitor.
I, too, felt considerable concern about Clause 15. Under paragraph 7 of the First Schedule, to which that Clause 1s tied, the High Court Judge is given a drastic power. Paragraph 7 reads as follows:The High Court or a judge thereof may, on the application of the Society, order that no payment shall be made without the leave of the High Court or a judge thereof by any banker named in the order out of any banking account in the name of the solicitor or his firm.That is a drastic and a far-reaching power. I have no doubt that "the High Court or a judge thereof" would not exercise that power unless the case was a serious one and the need for its exercise was fully warranted. I must say that I fail to see why, if that power is exercised by the High Court, it should also be treated as constituting an act of bankruptcy, and. as the noble Lord has said, it may be without there being any insolvency on the part of the solicitor. So it was with some considerable relief thai I heard the noble Lord say that on the Committee stage he may move to omit that clause from the Bill. I do not think that it is necessary for me to say anything with regard to Clauses 21 to 24.
I should like to say one word about the final matter to which the noble Lord referred, the decision in Brown v. The Commissoners of Inland Revenue. He told us that is was not practicable to carry out the law as laid down in that case and that he would come forward with a proposal to relieve the impasse due to the present impossible, impracticable situation. I do not quite know what it is he has in mind. If it be to reverse the effect of that decision, I dare say that may prove to be a somewhat controversial clause, because there is at present a Bill before another place called the Clients Money Accounts Bill which applies to accountants, architects, auctioneers, business transfer agents, estate agents, travel agents and so on, and which, at a cursory glance, would seem to me to follow the line of the decision in Brown v. The Commissioners of Inland Revenue in relation to those professions.
1131 I mention that Bill because perhaps the noble Lord, Lord Tangley, would wish to consider its provisions. I do not know how far it has got. It is a Private Member's Bill. But, obviously, any proposal to deal with that case is something which would have to be very carefully considered. But I hope that we shall be able to find a way, without arousing much controversy, in which a solution can be found to the problem to which the noble Lord has referred.
That is all I wish to say on the Second Reading of this Bill. It is a good Bill, a thoroughly beneficial Bill, and, in my belief, a much more important Bill to a great many people than one would realise from reading what it contains for just the first time. I wish it well, and I congratulate the Law Society on its production. It must have necessitated a very great deal of work on the part of the Law Society's staff, and, to my mind, they have produced a Bill which we should do our best to assist in getting upon the Statute Book.
§ 5.23 p.m.
§ LORD SILKIN
I should like to join with the noble Viscount, Lord Dilhorne, in congratulating both the Law Society on having introduced its Bill, and the noble Lord, Lord Tangley, on the way in which he has explained its rather complicated and somewhat discursive provisions. It gives me particular pleasure to congratulate Lord Tangley, because he referred to the fact that he was articled fifty years ago; and so was I. We were fellow students at the Law Society and, I hope I may say, we were friends—at any rate, we knew one another. If we at that time had forecast that he would one day be introducing, on behalf of the Law Society, a measure in the House of Lords dealing with the solicitors' profession, and that I should be supporting him, I think that we should both have been accused of extreme fantasy, and a good deal more. But here we are. Since those days the noble Lord has distinguished himself, not only in the field of law but in many other fields. He has been a member of the Council for many years and President of the Law Society, neither of which distinctions I myself have ever achieved. He comes here with very high credentials, and certainly he has 1132 explained this Bill with all the clarity of which he is capable.
The Law Society has taken a great deal of trouble about this Bill. It is the result of a committee which was set up some time ago to deal with a number of matters which required legislation, and I think in the main, though not in all cases, they have sought to implement the recommendation made by the committee. I feel that the Law Society and the legal profession are very often misunderstood. Very few people realise that legislation which they seek to introduce—and we are very much more closely governed and administered, I think, than any other profession which exists—is for the benefit of the public as a whole.
I have often heard in this House, which ought to know better, but certainly outside it, that when we support a particular piece of legislation we are doing so because it is complicated and helpful to the profession and will create work for them. Nothing could be further from the truth. No 1mportant firm of solicitors desires to make money out of seeking to interpret a complicated piece of legislation. If I may impart a secret to noble Lords, the litigation which most solicitors engage in is the least profitable part of their practice. Indeed, in my own case we make a slight loss on our litigation. Therefore, the last thing we want to do is to increase it or welcome it. I say, with emphasis, that there are very few professions which are more public-spirited and more eager to do the right thing by the general public than the legal profession, and I think that this Bill is an example of it.
The noble Lord, Lord Tangley, referred to a number of provisions in the Bill and divided them into four sections, I will try to do the same. The first section with which he dealt was that dealing with training. I agree with him and with the noble Viscount, Lord Dilhorne, that life has become so much more complex, for there is so much more legislation dealing with business affairs and with the relationship of the public with Government and so on, that it requires a far greater and wider knowledge and understanding of affairs, and that this should be reflected in the training of solicitors. I agree also that this is a changing matter and that it is certainly far more convenient that any changes in the training 1133 and education of solicitors should be by way of regulation rather than by introducing legislation from time to time for that purpose. The caveat I should like to enter is that we need a constant flow of articled clerks into the profession. I think it is true to say that at the present time the profession is undermanned. We need more solicitors and, therefore, we need more articled clerks. So we want to do nothing which will discourage solicitors from taking on articled clerks.
It is quite true that in the days of the noble Lord, Lord Tangley, and myself, before a clerk could become articled he had to pay a very heavy premium, heavy stamp duties and fees, and that during the whole time of his articles he received no remuneration. To-day that is out of the question: a premium is practically unheard of, and virtually all articled clerks get some remuneration. Indeed, in many cases they get an ordinary salary. But it must be recognised that during the first part of their articles they do not earn their salary. They know very little about the profession and can be of very little help, and their work is bound to be of a menial character. Towards the end of their articles they leave their firm altogether and go to the Law Society, where they are at present engaged full-time in training. So the amount of time that they are able to devote to the service of the firm to which they are articled is limited.
I would ask the Law Society to be very careful about still further limiting the time of service which an articled clerk can give to his firm and, ipso facto, to the amount of practical training he is able to get, because the best training is with the firm for which he is working. If the Law Society are so going to amend their regulations and system of training as to cause the articled clerk to give less time and service to the firm, I think they will find that more and more firms will become reluctant to accept articled clerks at all. It is already—and I speak from practical experience—a considerable inconvenience to find that an articled clerk to whom you have given a good deal of responsibility, who is able to conduct minor matters with slight supervision, suddenly has to go off to the Law Society, leaves all his matters unfinished, to be passed on to somebody else, and probably never returns. By the time he has completed his course his articles have 1134 come to an end. So this is a question which requires very careful consideration, and I am sure that the Council of the Law Society will give it.
Another point that I want to make on the question of regulations is that, as the Bill stands, it is contemplated that regulations will be used to a far wider extent, and they will have to be approved by the Lord Chancellor, the Master of the Rolls and the Lord Chief Justice. Of course, one could find no more appropriate body to approve these regulations than those three gentlemen. But I should have liked to see a solicitor also concerned in approving the regulations; somebody who has had practical knowledge and experience of the regulations which it is proposed to introduce. After all, these three lawyers have spent the whole of their working lives in another profession. They have no knowledge or experience of the workings of a solicitor's office or of such questions as training. Not only would it be better if a solicitor were involved; it would also give greater confidence to the profession to know that the difficulties of the solicitor's profession were appreciated in approving the regulations.
My other point about the regulations is that I hope that in every case where it is proposed to submit these regulations for approval the profession will have the fullest opportunity of discussing them and of approving them, and that any proposals they may make in connection with these regulations will be taken fully into consideration. I have no doubt that that will be so, but I want to emphasise that, unless there is complete and full discussion and understanding of the proposed regulations by members of the profession, there will not be the general support of them which one hopes they will carry,
I should like to express my complete agreement, as I have done before, with the noble Viscount, Lord Dilhorne, about common training for both solicitors and barristers. I am sure that would be of mutual advantage. This matter has been mooted for a considerable time, but I do not know what steps have been taken to bring it about. I should like to go even a little further, though I do not know whether I should carry the noble Viscount with me, because I appreciate how difficult barristers are about even having a cup of tea with a solicitor, let alone entering a solicitor's office. I think it might do a barrister some good if he were 1135 able to spend a little time in a solicitor's office as part of his training. That may be too revolutionary, but I think it is worth considering. I hope that when the discussions take place about the common training of the two professions it will be taken into account. Some six months in a solicitor's office, towards the end of his training when he might be of some use, would certainly be an advantage to the proposed barrister.
On the question of compensation, of course I fully support the giving of full compensation out of funds provided by members of the solicitors' profession to victims of solicitors' defalcations. I am a little less certain about compensation for delay, negligence, physical or mental incapacity and so on. I think there is some responsibility upon the client to ensure that he goes to a solicitor who is reputable and competent to carry out his business. I know that some clients are ignorant and think there is not much to choose between one solicitor and another. It may be true that a client who has a small matter will go to the nearest solicitor, especially if he does not have a regular one, and that nearest solicitor may turn out to be one of the people in the category I mentioned. But if a person has a really important matter to deal with, I think there is a responsibility upon him to make some inquiries and to go to somebody reputable, and not to go to a one-man firm where, perhaps, if the solicitor falls ill or meets with an accident, the whole of his practice may go to pieces. Therefore, I am not so sure about full compensation in those cases. I would not actively oppose it, but I think it is worth considering whether some distinction should be drawn between the one case and the other.
I should like to say one word about the disciplinary procedure of the Law Society—and here I hope that they will not take it amiss if I say that in my opinion, in their desire to enforce ethics and the best practice among solicitors, they have tended rather to lean over backwards. That is the impression I have. I am very fortunate: I have never had to come before them, so I have no personal interest. But the impression I have gained, from reading a number of cases, and from hearing a number of experiences, is that they have been a 1136 little more severe than the justice of the case has sometimes required. If I might respectfully suggest it, a little humanity and a little appreciation by the Disciplinary Committee of the difficulties of solicitors when dealing with disciplinary matters that come before them might not be amiss. For instance, I agree that a solicitor should put clients' money into a separate account. But something may go wrong; and, so long as there has been no defalcation, this is not, in my opinion, a matter which is necessarily a case for striking a solicitor off the Rolls. I do not say that that would be done in all cases, but I believe that there is a case for combining justice with mercy, and I hope that the Law Society Disciplinary Committee will be a little more merciful in some of the cases they have to deal with.
Finally, there is the question of Brown v. Commissioners of Inland Revenue. I appreciate the point made by the noble Viscount, Lord Dilhorne. This would conflict with a Bill which is at present before the House, which I believe was prepared in the days of the last Government and which the present Government are carrying forward. I think that is so.
§ LORD SILKIN
Then my point does not arise in that form. But the fact remains that I think it is a Bill that will command a good deal of support. Certainly we know that a great many estate agents collect deposits and presumably put them on deposit account in the bank, but never account either to the purchaser or to the vendor for the interest. And there are many other cases of that kind.
While I can see the difficulty, in practice, of paying out to each client the exact amount of interest which his particular money has earned in the relatively short period it has been in the solicitor's possession, I cannot see any difficulty, assuming that the solicitor pays all monies of that kind into a deposit account, in paying the client the average interest earned, whether it is one per cent. or two per cent. for the period during which the money has been in the possession of the solicitor. That would be a 1137 compromise; and if, somehow, that could be provided in the clause which it is proposed to introduce, I think that might well be the solution to the problem.
It is only right to say that I do not think this interest belongs to the solicitor; and it certainly does not belong to the bank. The only person to whom it can possibly belong is the person on whose behalf the money is in the hands of the solicitor. If the only difficulty is that of calculating the amount of interest to which he is entitled. I would suggest that a rough-and-ready practicable method of giving it to him would be either to lay down that interest at bank rate, or something of that sort, should be paid for the period in which the money is in the solicitor's hands, or to stipulate some arbitrary figure. At any rale, the client should receive the amount of interest which the money has earned.
My Lords, I have dealt with some Committee points, just as the noble Lord, Lord Tangley, did in introducing the Bill. I am sure that this Bill will have a very close scrutiny. Although it is not a Bill of general interest, it deserves the closest scrutiny, and I hope that it will receive a Second Reading.
§ 5.47 p.m.
§ LORD DENNING
My Lords, in my capacity as Master of the Rolls I have an inherent jurisdiction over solicitors—indeed, rather a paternal jurisdiction. So much so, that the Master of the Rolls has been said to be the father-in-law of all solicitors. As there are 20,000 practising certificates issued, one sees what a large family it would be. But in this capacity I have, of course, studied this Bill closely, and I should like to add my congratulations to the noble Lord, Lord Tangley, for his very lucid exposition of it. It is really a modernising Bill, in which the Law Society bring themselves in line with the conditions of to-day. I am thinking particularly, at first, of the education provisions. As Master of the Rolls, I have still to admit every solicitor to the Rolls. I have to certify as to his education and his fitness. In this regard, the new trend away from articles towards a university degree in law plus practical training is the way forward in line with most professional qualifications.
One word about the Bar and common examinations. Of course, very different 1138 from solicitors, members of the Bar do not come under any Parliamentary regulation; whereas solicitors, as the noble Lord, Lord Silkin, said, are perhaps under more statutory control than any other profession. But I am glad to say that there is now sitting a joint committee of members of the Bar and of the Law Society with the very object of considering an easier interchange between the two branches of the profession, whether by common examinations, towards which quite a lot has been done, or in any other way. I hope that before long that committee will produce practical results, because I am sure that everyone concerned with the profession will realise the advantages of easier interchange, whereby a solicitor who is better fitted to be an advocate can become an advocate, or vice versa.
There is only one other matter I would comment upon, and that is the disciplinary procedure. At the moment, every application for restoration from a solicitor who has been struck off the Rolls comes before me and I consider whether or not he should be restored to the Rolls. I hope—and I have tried to follow the precepts which the noble Lord, Lord Silkin, has mentioned—to exercise a little humanity in the matter, so that after a time, if the man has really rehabilitated himself, he can be restored to the Rolls. I hope and think that none of the solicitors whom I have restored have ever failed. In the Bill, it is proposed that that jurisdiction of mine should be altered in this respect: that in future the application should first go to the Disciplinary Committee for them to exercise their views and decision on the matter, and that from there there should be an appeal to me. That, I think, would be a help; because I should like to know what are the views of the Disciplinary Committee, the people who struck him off, on whether he should be restored or not, before the power is exercised by me on appeal.
§ LORD SILKIN
My Lords, may I ask this question? Would it come before the noble and learned Lord on appeal; or would he have the final word merely acting on the advice of the Disciplinary Committee?
§ LORD DENNING
As I understand the Bill, it would come before me on appeal, so that I could decide it as a Judge of 1139 Appeal, and could reverse it and take a different decision from that of the Disciplinary Committee.
The other matter which remedies a crying injustice and which has been mentioned is this. Hitherto a solicitor's clerk could be condemned equally with the solicitor, if he had been a party to the solicitor's fault. There was a case a few years ago where a solicitor had been guilty at fault and suspended for three years, and after his three years' suspension he was restored to the Rolls and regained his reputation in the City of London. But nothing could be done to help the clerk. He could not get employment with any solicitor except by the permission of the Law Society, so every time he wanted a job his past had to be brought up by reference to the Law Society. The Divisional Court commented on that. They said they hoped it would be remedied. Under this Bill, it will be. The solicitor's clerk, equally with the solicitor, can go before the Disciplinary Committee and ask, so to speak, for his character to be cleared: and, again, if they refuse there is an appeal to me as the Master of the Rolls.
I will not go further into the detailed provisions, but, having regard to the very clear exposition by the noble Lord, Lord Tangley, I would say, in my own personal examination, that I would commend the measure to the House as being a very wise, modernising and improving Bill.
§ 5.53 p.m.
§ THE LORD CHANCELLOR
My Lords, I think that all those of us who have had much concern with the Law Society have always been impressed by the energy and efficiency with which they carry on their task, and by their evident concern, in the interests of the public, to maintain the traditions of their very old and great profession. As the object of this Bill is to increase their facilities for that purpose, the Government welcome it—very much, if I may say so, for the reasons given by the noble and learned Lord, the Master of the Rolls.
There are one or two relatively small points on certain clauses that I would mention. Clause 6, as drafted, would, I think, enable the Law Society to refuse a certificate altogether; and I gathered from what the noble Lord, Lord Tangley, 1140 said, that that was not the intention. If so, no doubt he will think it right on Committee stage to put down an Amendment to make the position clear.
Secondly, I should like to associate myself with what the noble and learned Viscount, Lord Dilhorne, said with regard to the number of different applications in relation to which conditions might be imposed. As I understand it, the object of this provision is that if there is a young man who has just qualified but has not had sufficient practical experience to make it desirable for him to start straight out on his own, he can have a condition to that effect attached to his practising certificate. That may be quite reasonable in circumstances of that kind; but I would suggest for the consideration of the noble Lord, Lord Tangley, that that power should be limited, say, to the first two applications.
Clause 14, I suggest for his consideration, will not do. I need not trouble your Lordships with it in detail, but I suggest that its object could be achieved by an existing power—namely, by making use of Section 162 of the Judicature Act. I need not go into this point in greater detail, because, as the noble Lord knows, the Law Society, as I understand it, would quite accept that position if some practice direction were issued setting out the conditions under which a grant made under that section would be made; and I believe that something of that kind is under consideration. It may well be that by the time we come to the Committee stage some agreement to that effect will have been made.
I must also agree with what the noble and learned Viscount, Lord Dilhorne, said in relation to Clause 15, which provides that if the solicitor's bank account is frozen this is to be treated as an act of bankruptcy. It has always been the essence of an act of bankruptcy that it involves at least prima facie evidence of a debt; and the bankruptcy law is based on a question of debt. I have had the advantage of discussing this matter with the noble Lord, Lord Tangley, and I know that he well understands the objection. I think I ought to make it plain that the Government would feel bound, if necessary, at the Committee stage to press for that clause to be deleted.
The only other clause on which I need say anything is Clause 20. It provides 1141 that, with the consent of the solicitor in question, the Disciplinary Committee can be constituted of two members, instead of three. I would say, with a fair amount of experience of appearing for both sides before that Committee—not, I hasten to add, in the same matter—that my experience was rather in line with that of the noble Lord, Lord Silkin. If there is any criticism to be made, it is that it is a body which tends to be extremely severe, and sometimes gives the impression that the members of the Committee are all very big solicitors who do not always fully understand the conditions of work of the small solicitor struggling with a small staff on his own.
I would suggest to the noble Lord, Lord Tangley, that in a great profession like this, a Disciplinary Committee of three is, in any case, an extraordinarily small one. When one thinks of the size of the General Medical Council, or of the Benchers of the Inns of Court or the Professional Conduct Committee of the Bar Council, three seems a very small number on which a man's whole future should depend. I recognise the good intentions of saying, "Well, if one of the three has been held up because the traffic lights in Trafalgar Square have gone off, why can we not get on with two?", but I can see some disadvantage.
Any advocate who was asked if he would agree to the proceedings being continued with two would always feel difficulty in saying "I would object," because he would imagine that it would prejudice those who were there against his client. He would suppose their attitude would be: "Blast this man who is going to keep us all this time!" In such a case the advocate is under considerable restraint and, more or less, in practice is bound to say that he agrees. It is a matter for consideration, I suggest, whether the intention in fixing the number at three was that that should be the minimum number for a proper tribunal. If that is so, then it is not really right to say to the man whose whole future depends on the views of these people, "If we cannot in certain circumstances give you the proper tribunal, have you any objection to an improper one?" For those reasons, three ought to be the minimum number.
1142 I am sure we shall all be extremely interested if the noble and learned Lord is going to provide us with the proper solution to the case of Brown v. Commissioners of Inland Revenue. If he does, I think it would be the quickest period in which a decision of your Lordships' House, in its judicial capacity, had been overruled by a Bill in your Lordships' House in its legislative capacity. I know it will raise great difficulties, but I think the only advice I can properly give, without going into details, to the noble Lord, Lord Tangley, is not to pay undue attention to the suggestion that there is some other Bill which is likely to achieve this result.
Finally, with regard to common education, I should like to associate myself, if I may, with what the noble and learned Viscount, Lord Dilhorne, said. I think that a great many of us have both thought and said for a long time that to a considerable extent the education of the intending solicitor and barrister ought to be the same. The Law Society and the barristers have for a long time supported this, but, for some reason, one just does not seem able to get it done. For my part, I entirely agree with what the noble and learned Viscount said. Therefore, while there are one or two matters on which the Government may wish to express a view on Committee stage, for the reasons I have given the Bill is one which I would ask the House to accept on Second Reading.
§ 6.3 p.m.
§ LORD TANGLEY
My Lords, may I express my sincere gratitude to your Lordships for the sympathetic and kind way in which this Bill has been received? May I also thank noble Lords who have said kind words of the Law Society? They are nonetheless welcome because I believe them to be justified. May I also thank noble Lords who have made suggestions as to how this Bill might conceivably be improved?
I will first of all take up the point raised by the noble and learned Lord on the Woolsack about Clause 20. This clause, as I have said, is inserted entirely with the interests of the parties in mind, There are cases where there are a lot of books, witnesses, counsel and solicitors all ready, and a solicitor coming from the North or from Wales is held 1143 up. As it stands at the moment, there is nothing for it but adjournment. With respect, I accept what the noble and learned Lord said about the embarrassment to which an advocate might be put if asked the question, "Do you object to our going on?". I can well understand that. I have had that question put to me over and over again and know how difficult it is. But that is not the question that will be put under the clause as drafted. It would require this question to be put: "Which would the two parties prefer, to go away and throw away the day's proceedings or to go on before two?". It may only be for one or two hours until the third man turns up. This is a matter put forward entirely in the interests of the parties. I do not regard it as a very important one and I certainly will be prepared to consider it further when we come to the next stage of the Bill.
Curiously enough, I observe that the clauses which have been criticised, not only by the noble and learned Lord on the Woolsack but also by the noble and learned Viscount, Lord Dilhorne, are the exact clauses about which I myself was not very happy; and I said so in my speech. Clause 6 is the first one. I am not happy about the drafting of this clause. I think it wants looking at; but what is intended is that, for the first three years, the Law Society should not have the right to refuse a certificate but should have the right to attach a condition that the holder should not practise alone or in partnership. I think that the drafting of the clause gets nearer to that than might at first appear. But that is the intention, and I will certainly look at it again before Committee stage to see that the intention is properly carried out in the Bill.
May I say how much I welcome the remarks that have been made by several noble Lords about the conversations between the Law Society and the Bar? They are proceeding now more quickly than they have in the past, principally because some of the constitutional difficulties of negotiation have been removed by the Bar. I must confess, though I did not mention it in my speech, that I had very much in mind the possibility of facilitating such discussions as are going on, if we had the power in the Law Society to make regulations rather 1144 than having to hold things up until we thought it proper to make another claim on Parliamentary time. That is an additional reason, in my own mind, why it would be proper to substitute regulation entirely for a mixture of regulation and Statute.
As one would expect, the noble Lord, Lord Silkin, raised a number of practical points, with all of which I think I agree. Certainly we do not want to stop law students from having proper practical training in the office. For many years I was chairman of what was then called the Articled Clerks' Committee of the Council of the Law Society, and I seem to have spent a disproportionate part of my life in trying to get a quart into a pint pot, so far as legal education is concerned. One must have a proper knowledge of the law, which involves academic training; one must have some practical experience of suitable length in an office and one must have a final examination which is a fairly difficult thing, because, after all, a solicitor is let loose on the public when given his practising certificate. Somehow or other, as I said in my speech, we have to get all this through before a man reaches middle age. If we had ten or fifteen years in which to do all these things it would be easy, but we have only five or six, and it is not so easy. But I assure the noble Lord that the Law Society is just as keen as he is that the practical training should be given as much emphasis as is possible, having regard to the difficulties I have mentioned.
Certainly the profession would be consulted about all these matters. I think there is a better system of consultation now between the Council of the Law Society and the general body of the profession than there has ever been before, owing to the perfecting of the system of local law societies. They used to be called provincial law societies, but one of the provisions in this Bill, which I did not think it necessary to mention, changes the name to local law societies. The reason is that there are two or three in Middlesex, and I am afraid I cannot be heard to say in this House that Middlesex is part of the Provinces any longer, particularly after the statement made on behalf of the Government this afternoon.
1145 There is nothing to prevent Bar students from coining into solicitors' offices for some months. We have had them in our office in the past, and it has been quite successful. I do not see chat there is anything against it. Once they have become barristers, then the quarantine provisions come into effect.
The point made by the noble Lord, Lord Silkin, about the Compensation Fund is, if I may say so with respect, not quite justified by the wording of the clause. It may be that I was not sufficiently clear in explaining it, but the additional condition under which a grant can be made out of the Compensation Fund does not involve any kind of delay or negligence, but only unexplained delay in paying the money due to a client, which is a much narrower thing than the noble Lord had in mind.
I am sorry to hear that there is some thought that the Disciplinary Committee is unduly severe. Certainly the case mentioned by the noble Lord, Lord Silkin, of a man who has been guilty of a breach of the accounts rules, though, somehow or other, the client has not suffered, I regard as a very serious offence. If we once relax and let it be thought that a man will not get into trouble for a breach of the accounts rules unless somebody suffers loss, then you might just as well tear up the accounts rules. I hope that the Disciplinary Committee, however merciful it may be in other respects, will never give way on the essential necessity of maintaining the full integrity of the accounts rules and the rules about handling clients' money.
That leaves me to deal with the question of Brown's case. If I may say so, I think the noble and learned Lord on the Woolsack rather overstated what I promised the House I would do at the next stage. I do not think I promised to find a solution. What I said was that I would give the House an opportunity of considering a solution. That is not necessarily the same thing, although I hope that in the end it may turn out to be the same thing. The real trouble is that you 1146 get a solicitor in practice who has a large number of small amounts that come in from clients. Some may be in for weeks, some may be in for many days and some may be in for one or two days; and the monies will be coming in and going out for various purposes. Any one of those amounts, individually, could not be put on deposit at the bank. It would be impossible to put them on deposit, and they could not possibly earn interest. It is only because they are agglomerated with a great many more that the solicitor can do this.
If he had to work out exactly how much interest had been earned by each particular client, it would entail an impossible amount of work. The sort of result to the client would be an additional charge in the Bill: "To working out the amount of deposit interest due to you, 10s. 6d. Less deposit interest, 6½d. Minus tax at the standard rate, 4d., 2½ d. Total bill, 10s. 3½d." It is not practical politics to segregate these tiny sums in the cases where they are on deposit for a short time. Where you have a rather large sum on deposit for a reasonable time it is the practice of solicitors to account for the interest and pay it to the client concerned. We feel that we ought to try somehow to find a solution to what is a very practical problem, so vividly described by the noble and learned Lord, Lord Upjohn, in the passage from his Opinion which I quoted. I repeat that I am grateful to the House for the reception given to this Bill. I think it is a good Bill, and I am very much comforted to have had that confirmed by so many noble Lords.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.