§ 3.45 p.m.
§ Order of the Day for the Second Reading read.
§ THE LORD CHANCELLOR (LORD GARDINER)
My Lords, I beg to move that this Bill, which is a Consolidation Bill, be now read a second time.
§ Moved, That the Bill be now read 2a.—(Lord Gardiner.)
§ LORD PEDDIE
My Lords, I should be glad to have the opportunity of making a brief comment at the Second Reading of the Industrial and Provident Societies Bill, which is a Consolidation Bill, and to take the opportunity of drawing attention to one rather complicated point that arises with regard to the discharge of mortgages. At this stage I would declare an interest: the fact that I am a director of a co-operative organisation and a director of a co-operative insurance society which will be affected by this Bill.
Clause 33 of this Bill would have the effect of requiring discharges of mortgage through an industrial and provident society to be signed by two members of the committee and countersigned by the secretary. On the face of it that would appear to be a right and proper thing to do. But it raises rather a special problem for any very large society that may 1021 be registered under the Industrial and Provident Act and is undertaking a large volume of business. I would suggest that the Industrial and Provident Societies Act in this particular field is not designed to cover particularly the requirements of a very large insurance concern. To illustrate my point I will, if I may, make reference to the Cooperative Insurance Society which, prior to 1959, affected discharge of mortgages by having a receipt of mortgage signed by two members of the company. By 1959 this procedure was found to be a great, if not an intolerable, burden; and I can point out that in 1958 some 10, 900 mortgages to the Society were discharged. These figures include discharges of mortgages on surrender value of life policies. The number of discharges now dealt with has increased to more than 500 per fortnight. I mention "per fortnight" because board meetings are held fortnightly.
In 1959, it is interesting to note, the Co-operative Insurance Society—and possibly others did likewise—took counsel's advice on the possibility of using the discharge procedure provided in Section 115 of the Law of Property Act, 1925. Counsel at that time advised that the Society could use this procedure, whereby the seal of the Society was affixed to the discharge, thus avoiding the signature of two committee men. Under Clause 33 of the Bill in its present form, the Society would be prevented from discharging mortgages under the procedure provided by Section 115 of the Law of Property Act, 1925. I express the hope that there will be a possibility of effecting some amendment or modification of Clause 33 in such a way as to permit the use by an industrial and provident society, where justification is apparent, of the alternative to the signature of two committee men for discharging mortgages, by adopting the procedure of Section 115 of the Law of Property Act. In passing, I may point out that, in practice, solicitors are found to welcome the seal of the society as being indicative of the greater authenticity of a document than would be provided by two signatures, apart from the fact that the signatures themselves are often indecipherable.
1022 To deal with this problem, which applies especially to large organisations particularly the insurance organisations to which I have referred, would necessitate only slight amendment. I feel that any amendment along the lines I have suggested would be of a minor nature and would certainly not prejudice any other industrial and providentsociety. I draw this matter to the attention of your Lordships' House because, whil I welcome this Consolidation Bill, at the same time I feel that it somewhat overlooks the exceptional difficulty which this clause would bring to large societies which are involved in the type of work I have indicated.
§ THE LORD CHANCELLOR
My Lords, I did not think that it would be courteous to interrupt my noble friend Lord Peddie, because, of course, I have no say in the procedure of your Lordships' House, which is entirely a matter for your Lordships, but, as I understand it, your Lordships have always taken the view that on the Second Reading of a Consolidation Bill the only question which can properly be discussed is the question: Is this a field within which it is a good thing to have a Consolidation Bill? The whole object of appointing the Joint Committee on Consolidation Bills is precisely in order to consider the kind of point which my noble friend has raised; and I would ask him to be good enough to put his point to the noble and learned Lord, Lord Morris of Borth-y-Gest, who is Chairman of the Committee, or to any other member of the Committee, because this is just the kind of point that the Committee look at and report upon to the House. I would suggest to my noble friend that it is not a matter which properly can be considered on the Second Reading of a Consolidation Bill.
§ LORD PEDDIE
My Lords, I thank my noble and learned friend on the Woolsack for the comments he has made. I appreciate them very much indeed, and I will certainly take the advice he has offered.
§ On Question, Bill read 2a, and referred to the Joint Committee on Consolidation Bills.