HL Deb 18 October 1966 vol 277 cc47-62

4.55 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.)

but what your Lordships are being asked to decide is whether this Bill is worthy of being considered in Committee. I hope that it is.

4.44 p.m.

On Question, Whether the Bill be now read 2a,

Their Lordships divided: Contents, 9; Not-Contents, 111.

CONTENTS
Airedale, L. [Teller.] Meston, L. Sinha, L.
Asquith of Yarnbury, Bs. Moynihan L. Swaythling, L.
Henley, L. Ogmore, L. Wade, L. [Teller.]
NOT-CONTENTS
Aberdeen and Temair, M. Fortescue, E. Mowbray & Stourton, L.
Fraser of North Cape, L. Newall, L.
Addison, V. Fulton, L. Nugent of Guildford, L.
Gainsborough, E. Oakshott, L.
Ailwyn L. Gardiner, L. (L. Chancellor.) Pargiter, L.
Albemarle, E. Glasgow, E. Peddie L.
Alport, L. Goschen, V. Phillips, Bs.
Ampthill, L. Greenway, L. Ritchie-Calder, L.
Archibald, L. Grenfell L. Royle, L.
Arwyn, L. Gridley, L. St. Aldwyn, E.
Ashbourne, L. Grimston of Westbury, L. St. Davids, V.
Atholl D. Hankey, L. St. Helens, L.
Attlee, E. Harlech, L. St. Oswald L.
Blackford, L. Hawke, L. Sandford, L.
Blyton, L. Henderson, L. Sandys, L.
Bowles, L. Hilton of Upton L. Segal, L.
Braye, L. Hughes, L. Shepherd, L.
Brooke of Cumnor, L. Ilford, L. Silkin, L.
Brooke of Ystradfellte Bs. Inglewood, L. Somers, L.
Burden, L. Kennet, L. Sorensen L.
Champion, L. Kilbracken, L. Spencer, E.
Chorley, L. Kilmuir, E. Stocks, Bs.
Citrine, L. Latham L. Stonham, L.
Clwyd, L. Leatherland, L. Stow Hill, L.
Collison, L. Lindgren, L. [Teller.] Strang, L.
Colville of Culross, V. [Teller.] Long, V. Strange of Knokin, Bs.
Conesford L. Longford, E. (L. Privy Seal) Strathcarron L.
Cooper of Stockton Heath, L. Maelor, L. Summerskill, Bs.
Crook, L. Mansfield, E. Swanborough, Bs.
Daventry, V. Massereene and Ferrard, V. Swinton, E.
Denham, L. Merrivale, L. Taylor of Mansfield, L.
Derwent, L. Mersey, V. Twining, L.
Effingham, E. Milverton, L. Vivian, L.
Emmet of Amberley Bs. Mitchison, L. Walpole L.
Erroll of Hale, L. Molson, L. Wedgwood, L.
Falkland, V. Monsell, V. Wells-Pestell, L.
Falmouth, V. Morris of Kenwood L. Williamson, L.
Forster of Harraby, L. Morrison, L.

On Question, Motion agreed to.

House in Committee accordingly.

[The EARL OF LISTOWEL in the Chair.]

Clause 1 [Removal of certain bars to rescission for innocent misrepresentation]:

THE LORD CHANCELLOR (LORD GARDINER) moved to leave out subsection (2). The noble and learned Lord said: As it is now some months since the Bill was before your Lordships' House, perhaps I might, in moving this Amendment, remind your Lordships that the Bill arises because our law when a man is induced to enter into a contract by a misrepresentation has long been thought to be unsatisfactory in three ways. In the first place, he has a right to rescind the contract before the contract is executed, but not after; and as you do not usually discover that the representation was a misrepresentation until after execution, this is not much good. Secondly, although you have a right to damages, you have such a right only if you can prove that the misrepresentation was made fraudulently. There is always a heavy onus on anybody who seeks to prove fraud; and, of course, you do not know what was in the mind of the vendor, or the other party to the contract, at the time he made the representation. Thirdly, anybody can contract out of his liabilities in these respects.

Your Lordships approved on Second Reading a principle of the Bill which would give effect to a change of the law in this sphere, but two or three points have remained over, and the subject matter of this Amendment which is to delete subsection (2) of Clause 1 arises in this way. The Law Reform Committee on whose Report the Bill, in substance, is based, thought that contracts relating to land should be excluded from the changes to be made in the law, except in the case of short leases. Accordingly when, in the last Parliament, this Bill was introduced in another place, it contained the provision, subsection (2) of Clause 1, which would exclude contracts for the creation or transfer of an interest in land except leases for not more than three years.

When the Bill was in Committee in another place, strong objections to this were expressed—not at all, of course, on Party lines, because this is not a subject which has anything to do with Party politics, but from both sides of the Committee equally. It was said, in the first place, that the damage a man might suffer if he was induced to enter into a contract for the sale or transfer of interest in land by a misrepresentation was likely to be more, rather than less, than in the case of a contract relating to a chattel; therefore there was no good reason for this exception. In consequence, the Government accepted an Amendment in Committee in another place deleting this provision, though they intimated that on Report they might have something further to say about it. In fact, the Dissolution then took place.

When the Government reconsidered the matter with a view to reintroducing the Bill in this House in the present Parliament, advice was taken from the Law Society and from bodies like the Royal Institution of Chartered Surveyors, and they were in favour of retaining this exception. Therefore, when the Bill was reintroduced as it is before your Lordships, this exception relating to land was retained, and that is why at the moment it still appears as subsection (2) of Clause 1. In moving the Second Reading I explained these matters to your Lordships, and said that the subsection had been put back, partly on the advice which had been received from the bodies to which I have referred, partly so that, being in the Bill, it would not necessarily be a matter of argument. Though I felt very much in two minds myself, I said that I should be largely guided by the views which were then expressed by your Lordships.

On the Second Reading the noble and learned Lord, Lord Upjohn, was in favour of retaining the subsection. He said: After all, contracts affecting land are in a very special class of their own. The solicitor investigates the title, and the surveyor inspects the property and any adjoining properties which he thinks fit.…So many contracts of sale are married up with the sale or purchase of some other houses. Mortgages are almost invariably taken on some new property. I think, to use the words of Lord Jenkins' Report, that if you rescind where there has been a passing of a legal title you might set up a chain reaction. But, of course, I agree entirely that leases for under three years should be subject to what will be the new general rule; that is, they may be rescinded for innocent misrepresentation. The truth of the matter is that tenancies of that description are frequently entered into without legal advice, no proper surveys are made, and therefore the oral representations of the intending landlord play a far greater part in inducing the contract than they do in the bigger trans. actions."—[OFFICIAL REPORT, Vol. 274 (No. 13), col. 944: 17/5/66.] The noble and learned Lord, Lord Denning, took a different view. He said: First of all, I would suggest that Clause 1(2) should come out. It seems to me that if a person makes a misrepresentation, even in the case of a sale of land or the grant of a tenancy for four or five years, and somebody is misled by it and is induced to enter into a contract which he would not otherwise have done, one should be able to set it aside, so long as the person comes along in time before other people are prejudiced. The Common Law has always done this in regard to chattels. It should now apply also to sales of land, and I consider that there should not be that exception in subsection (2)."—[Col. 941.] The noble Lord, Lord Wilberforce, took the same view. He said: I am rather with those who would be in favour of deleting from the Bill the existing subsection (2) of Clause 1 on the simple ground that misrepresentations as to houses or bungalows are just as common, and just as damaging to purchasers, as are misrepresentations about other goods. One does not see at first sight why buyers of motor cars are more liable to be duped or are more in need of protection than buyers of bungalows. It is perhaps rather significant to remember that the case which, far more than Seddon's case, gives rise to the difficulty in the existing law (the noble and learned Lord the Lord Chancellor referred to it: a case about drains, decided in 1911) is itself a case about the sale of a house. So the problem does exist in relation to houses. One would think it needs to be solved, and I do not see any difficulty in solving it in the way already suggested—namely, by giving a right of rescission where rescission can be carried out without interfering with third party rights. Of course, in some cases that will not be possible, though in others it will. But, on the face of it, I do not see any reason for differentiating between sales of land and other sales.—[Col. 949.]

The conclusion to which the Government have come is that this subsection ought to be deleted, mainly on these grounds. First of all, the exception within the exception is very difficult to defend logically, the exception being contracts relating to the transfer of land, and the exception within it being leases of more than three years. It is difficult logically to see why, if you ought to have a right, when you are induced by misrepresentation, to deal with a 2½-year lease, the law ought to be quite different if it is a 3½-year lease; and there is no real logical place at which one can draw a line. Secondly, and mainly, there is the reason that it has always been part of our law of misrepresentation, and still will be, that a contract cannot be rescinded if the parties cannot be restored to the position in which they were originally, and that it is also part of our law that there cannot be rescission if the rights of third parties have come in question. Nothing in the Bill alters that situation.

It is true that there will be many cases relating to interests in land where there is some chain reaction, where it is impossible to put the parties back to the position which they were in before or where the rights of third parties have been interposed. In those cases, there will not be rescission. But the point which nobody, to my mind, has ever answered, although I drew attention to it on Second Reading as being the strongest argument of those who wished to delete this subsection, is that the mere fact that the cases may not be many in this field, to which the new law will apply, does not seem to be a good reason for excluding the new law in those cases, whether they be few or not, to which it would apply. It is for these reasons that I would ask the Committee to agree to the deletion of this subsection, and I beg to move accordingly.

Amendment moved— Page 1, line 14, leave out subsection (2).—(The Lord Chancellor.)

VISCOUNT COLVILLE OF CULROSS

I think that noble Lords on this side of the House will welcome the proposal that the noble and learned Lord has made to leave out subsection (2) of Clause 1. We would also thank him for what I know has been a prolonged series of negotiations and discussions behind the scenes, in which the noble and learned Lord has probably found a great deal of help and succour from the speeches made by noble Lords on the Second Reading of this Bill. I am sure that the noble and learned Lord will be able to tell us that he has considered all the points, some of them extraordinarily subtle and complicated, raised by noble Lords in that debate. In particular, I recall the question of the technical difficulties arising from the merger of contracts, if the exception as to land were removed, as is now proposed. I hope that the noble and learned Lord is satisfied that no difficulties are going to arise from that.

Having said that, I would add that I am sure it is right to do as the noble and learned Lord has suggested. As he has said, the alternative remedy in Clause 2(2) may in many cases be the one which is used—that is, of damages in lieu of rescission. But I could never under- stand why, when that remedy, instead of rescission, was going to be available in case of everything else, it should be denied in the case of land. The only remedy apparent in the Bill until this Amendment is made was the one in tort under subsection (1) of Clause 2, which is subject to the special defence set out at the end of that subsection. I think that it is much more satisfactory to deal with it as the noble and learned Lord has suggested. I do not believe that there will be any unfairness. I believe that the courts will be thoroughly capable of deciding when rescission is suitable and when damages are a more convenient alternative. In those circumstances, I would advise the Committee to accept this Amendment.

THE LORD CHANCELLOR

I am grateful to the noble Viscount for what he has said, and I gladly acknowledge the help which I have received from noble and learned Lords, not only by reason of what they said on Second Reading but also by reason of the advantages I have had in discussing these matters with them since.

On Question, Amendment agreed to.

Clause 1, as amended, agreed to.

Clause 2 [Damages for misrepresentation]:

5.8 p.m.

THE LORD CHANCELLOR moved in subsection (2), after "court", to insert, "or arbitrator". The noble and learned Lord said: I beg to move the second Amendment standing in my name. This is a short point. There is some doubt as to what the powers of the arbitrator in this field may be, although from the observations made by a majority of noble and learned Members of this House in a case called Heyman v. Darwins Ltd., in 1942, it would seem that arbitrators probably can deal with this matter. If they can, the law which is to be applied by an arbitrator obviously ought to be the same as the law applied by a Judge. The simple purpose of this Amendment is to make provision for arbitrators to have the power of awarding damages as well as, and on the same terms as, they would be awarded by a court.

Amendment moved— Page 2, line 9, after ("court") insert ("or arbitrator").—(The Lord Chancellor).

VISCOUNT COLVILLE OF CULROSS

I think that this Amendment is clearly right, also, and we welcome it from this side.

On Question, Amendment agreed to.

Clause 2, as amended, agreed to.

Clause 3:

Avoidance of certain provisions excluding liability for misrepresentation

3.— (1) Subject to subsection (2) of this section, if any agreement (whether made before or after the commencement of this Act) contains a provision which would exclude or restrict—

  1. (a) any liability to which a party to a contract may be subject by reason of any misrepresentation made by him before the contract was made; or
  2. (b) any remedy available to another party to the contract by reason of such misrepresentation;
that provision shall be void if the liability to which it relates is one arising under section 2(1) of this Act, and shall in any other case be of no effect unless it is proved that the person making the misrepresentation had reasonable ground to believe and did believe up to the time the contract was made that the facts represented were true.

(2) Where any terms of a contract have been arrived at in negotiations between the parties and—

  1. (a) the terms so arrived at expressly provide for matters of any description; and
  2. (b) the contract confines the liability of any party with respect to matters of that description to those so provided for;
subsection (1) of this section shall not affect any agreement, whether or not contained in that contract, so far as it relates to any misrepresentation with respect to matters of that description.

THE LORD CHANCELLOR moved, at the beginning of subsection (1), to leave out "Subject to subsection (2) of this section,". The noble and learned Lord said: With your Lordships' permission, perhaps I may also take Amendment No. 4 with this, because they are linked Amendments. This raises the other question which was much debated before your Lordships on Second Reading as to exclusion clauses. Here, your Lordships may remember, the Committee had reported recommending in favour of a clause which would prevent anyone from contracting out of the provisions of the new law. As I told your Lordships on Second Reading, after that the Confederation of British Industry said: "Of course, we do not object to a provision that you cannot contract out so far as ordinary sales and contracts are concerned"—because very often these clauses are in small print on the back, people do not read them, and they do not understand them if they do read them—"but there may be cases, for example between very large business contractors, perhaps for the erection of some plant abroad, where all the terms of the contract are carefully negotiated by the solicitors for these large firms and a liability is deliberately excluded as a quid pro quo of some other kind. Therefore, if you are going to exclude contracting out, some provision ought to be made for a case of that character.

As I told your Lordships on Second Reading, the Government had accepted that this was desirable, if it were possible, and so in Clause 3(2) one finds the words Where any terms of a contract have been arrived at in negotiation with the parties"— the contracting out was to be allowed; and the idea of this wording was to cover the sort of case which the Confederation of British Industry had in mind. But it was much criticised by the noble and learned Lord, Lord Reid, on Second Reading, who said: "How can you decide whether the terms of a contract have been arrived at in negotiation? What exactly does 'negotiation' mean? Does it cover oral conversation in a shop, or what?".

Since then the Government have given careful thought to this problem, which is a very real one. Lord Reid himself, in a case before your Lordships' House this year, had expressed what I think may be our general view on exemption clauses. What he said was: Exemption clauses differ greatly in many respects. Probably the most objectionable are found in the complex standard conditions which are now so common. In the ordinary way the customer has no time to read them, and, if he did read them, he would probably not understand them. If he did understand and object to any of them, he would generally be told that he could take it or leave it. If he then went to another supplier, the result would be the same. Freedom to contract must surely imply some choice or room for bargaining. At the other extreme is the case where parties are bargaining on terms of equality and a stringent exemption clause is accepted for a quid pro quo or other good reason; but this rule appears to treat all cases alike.

When one applies one's mind to this situation, which has always been some- thing of a problem, one feels that it is quite wrong that a person can be sold something and get a thing called a guarantee—and sometimes it looks very fine, with the scroll—whereas lawyers know that its sole object is that part where it says: and this guarantee is in place of any other warranty implied by law or otherwise. The real effect is simply that if you go into a shop and make plain what you want and what you want it for, it is already the law, without anything more being said, that it must be reasonably fit for the purpose for which it is supplied. And that is only right. But if there is a guarantee of the kind I have mentioned, all it really does is to take away much more than it gives.

On the other hand, there are cases in which the parties are big companies and are at arms' length from one another. Our law is still theoretically based on there being freedom of contract. Originally, no doubt, that was so, and the solicitors for both parties, in red ink, green ink and yellow ink, really negotiated the terms of the contract. But we live in days in which it is no good saying to the Gas Board: "We like your gas, but we do not like your standard terms of contract". They will say: "We are sorry, but that is the way we do business. You will have to lump it." There is no way of defining the circumstances which divide the two kinds of case to which I refer.

That is why the Amendment which is now proposed, in trying to classify the sort of circumstances to which the Confederation of British Industry refers, would leave it to the Judge. So this Amendment would now read as follows: If any agreement (whether made before of after the commencement of this Act) contains a provision which would exclude or restrict—

  1. (a) any liability to which a party to a contract may be subject by reason of any misrepresentation made by him before the contract was made; or
  2. (b) any remedy available to another party to the contract by reason of such a misrepresentation;
that provision shall be of no effect except to the extent (if any) that in any proceedings arising out of the contract, the court or arbitrator may allow reliance on it as being fair and reasonable in the circumstances of the case. Prima facie, contracting out will not be allowed, and will not be allowed unless the Judge is satisfied that in all the cir- cumstances of the case it would be fair and reasonable to allow it.

I have always thought that any legal system ought to make the best of its good points, and I have always thought that the best thing about our legal system is the quality of the Judges. That being so, this is a very sensible way of dealing with a point of this kind. The Amendment has satisfied the noble and learned Lord, Lord Reid; it is approved by the Law Commission; it is approved by the Confederation of British Industry, and I hope it may be approved by your Lordships. I beg to move.

Amendment moved— Page 2, line 20, leave out from beginning to ("if").—(The Lord Chancellor.)

5.18 p.m.

VISCOUNT COLVILLE OF CULROSS

I suppose that the first reaction to this Amendment is its breathtaking simplicity. It must be a very rare thing in an Act of Parliament which is attempting to deal with a set of circumstances as complicated as those which will crop up in the application of Clause 3 of the Bill that, in these days at any rate, we should risk leaving it so extraordinarily indefinable and entirely to the good sense of the Judges. I am sure that this is a worthwhile experiment. I am reinforced in my courage in this respect, first of all by the fact that I think it was suggested by the noble and learned Lord, Lord Reid—and doubtless that suggestion would be based upon the wide jurisdiction in matters of this sort that Scots Law gives to the Courts of Session there—and secondly, by the fact that the noble and learned Lord the Lord Chancellor has told us of all the others who have now approved of it.

I would make only one point about this. As I understood the course of the debate on Second Reading, this deals with a small part only of the general subject of contracting out, and the question of liabilities of this sort and indeed the whole matter is at present before the Law Commission. I do not know at what stage any results may come from their consideration, because the matter is a difficult one, but I should think that this experiment (and I believe it is an experiment) might provide some useful information in the course of decided cases at all levels—and arbitrations, too, because they are covered—which would give a line on the way in which a provision of this type might work. If it is successful, it may well be that this is the prototype for other legislation dealing with a much wider field of contracting out. Therefore, perhaps there is an advantage in putting it in this Bill, which is exactly the opposite to what was being said on Second Reading. There is an advantage in trying it out in this rather narrower field in this Bill so that we may see and learn by experience whether or not it is after all the universal solution. At any rate, considering the appalling difficulties of trying to cope with the diverse circumstances in which this sort of case will arise, I am sure that it is a worthwhile thing to do.

I am particularly glad that it has been chosen, because not only did I hear on Second Reading debate about the particular difficulties raised by the C.B.I., but I believe there are markets of great importance in this country which are entirely governed by various restrictions which would previously have been made untenable by the terms of this Bill, and without which I believe the market simply would not work at all. Some dismay was beginning to be felt as to whether the whole basis of the transactions which went on in those spheres was going to be undermined. Now I believe there will he an escape for them if they can show to the satisfaction of the court that the restrictions upon which they have always relied, and still rely, are in fact worthwhile and justifiable. Therefore, I believe that their particular apprehensions may be removed. I welcome this. I hope very much that it will work, and I think it is very brave of the noble and learned Lord to introduce it to Parliament.

5.22 p.m.

LORD CHORLEY

I should like to join the noble Viscount who has just resumed his seat in welcoming this alteration in the Bill. I have given a good deal of thought to Clause 3, and I am satisfied that this is a great improvement on the clause as it originally stood. I am glad that the noble and learned Lord has told the Committee that it has been agreed with the Law Commission. I know that a great deal of work lies behind that laconic statement, and I am glad indeed that it has been decided to leave this matter to the discretion of the judge who is trying the case.

On so many occasions, when attempts have been made in Parliament to leave matters to the discretion of the judge, it has been objected that the law ought to be firm and certain and that one ought not to rely on judicial discretion. It has always seemed to me, especially in the light not only of the legal but of the business ability which is shown by our judges in dealing with matters of this kind which are largely of a commercial or quasi commercial character, that we could do a great deal more on these lines. We are now living in a very different community from the one which existed say a hundred years ago, when rules could be simple, clear and rigid without very much danger.

Therefore I welcome this particular aspect of this clause and hope that it will be a forerunner of other occasions when it will be decided to leave matters of this complexity to the discretion of the judge who has heard all the evidence and who is trying the case.

On Question, Amendment agreed to.

THE LORD CHANCELLOR

I beg to move this Amendment, which is purely consequential.

Amendment moved— Page 2, line 28, leave out from beginning to end of line 43 and insert ("that provision shall be of no effect except to the extent (if any) that, in any proceedings arising out of the contract, the court or arbitrator may allow reliance on it as being fair and reasonable in the circumstances of the case").—(The Lord Chancellor.)

On Question, Amendment agreed to.

On Question, Whether Clause 3, as amended, shall stand part of the Bill?

LORD CHORLEY

I do not propose to move the Amendment which stands in my name, but I should like to take a few minutes of your Lordships' time in explaining how I came to put it down, and why I am not proposing to move it. As the noble and learned Lord has explained, this clause deals with exclusion clauses in contracts, and it was very much debated on Second Reading. The noble and learned Lord, Lord Reid, in a powerful speech, which carried my full agreement—not that that matters very much—pointed out that this is really a small part of a much larger problem. This is a problem which the Law Commission, only recently appointed, decided to tackle courageously and very properly at this early stage in their career. The noble and learned Lord indicated that he thought it would be much better to leave it to the Law Commission to consider, in the context of their much wider research and investigation. In this he was, I thought, strongly supported by the noble and learned Lord, Lord Wilberforce. So we had these two important expressions of opinion.

I think it is very important that, when we have set up a Law Commission to deal with matters of this sort, we should be careful before we impinge on what they are doing. Some years ago we set up a Royal Commission under the noble Viscount, Lord Amory, on criminal problems. The Commission were given very wide terms of reference, collected a great deal of evidence, and sat on many occasions. During this time a number of Bills impinging on what they were doing were introduced in Parliament, and eventually the Commission were wound up. I do not know how true this is, but it was stated in responsible quarters in the Press that one of the reasons why a substantial proportion of the personnel handed in their resignations was that it was a waste of their time to make these researches and give all this work to the problem, while it was being, so to speak, encroached upon by small Bills dealing with sections of the subject, unrelated to each other, and unrelated to some extent to the general problem, which were being brought before Parliament—not always going through but sometimes going through when the Government sponsored them.

It seems to me that that is an important lesson and one which is relevant in the circumstances of this case. When the noble Lord, Lord Cohen of Brighton, shortly after this Bill was introduced here, introduced another Bill dealing with an analogous problem, the noble and learned Lord himself made the point with that persuasive eloquence that we all expect from him, that it would be a mistake, however good the noble Lord's Bill was, for us to take it because it was in the direct line of the country which the Law Commission were exploring and dealing with. That seemed to me to be very important indeed.

While I was thinking about this, rumours began to spread in parts which are frequented by lawyers that the Law Commission not only had not been consulted about this, but did not like it because it would interfere with their work, and it was even said that one of their members intended to resign. I do not propose to say a name, but a name was in fact mentioned. This seemed to me to be an unfortunate rumour, as we expected this matter to come up before long. Incidentally, I do not think there is any truth in this, from inquiries I made afterwards. But it seemed to me that the noble and learned Lord should be able to deny that anything of the sort had happened, and to inform Parliament that he was in discussion about this matter with the Law Commission. He has in fact told us that not only has he been in consultation with them (one deduces that from what he said) but that this is the result of this consultation, and it is obviously a considerable improvement over the earlier proposal.

I would not suggest for a moment that the fact that the Law Commission are dealing with something is an insuperable reason why a Bill should not be passed through Parliament. That would lead to a hold-up which law reformers would be sorry to see. There may be all sorts of cases where it is perfectly possible, without interfering with their work in any way, provided Parliamentary time can be found, to get a much-needed reform carried through Parliament. But it ought to be done in consultation with them, and they should have the opportunity of commenting upon it and of indicating whether they think what is proposed falls into the general programme and is in the line of progress in regard to legal reform, because we are entrusting a tremendous and most responsible task to the Law Commission. I am glad to know that in the end this happened in connection with this particular clause, and obviously in those circumstances not only do I not wish to see the clause deleted but, as I explained in a short interjection before the matter was put from the Chair, I am heartily in favour of it.

That is all I need say, except that I want to stress the importance of going ahead in co-operation with the Law Commission, and there being no question at all of any possibility of its being said that they are in disagreement with anything which has been done; or, if it is so said, it should be brought out and the whole thing explained so that we know where we are.

THE LORD CHANCELLOR

I am grateful to the noble Lord, Lord Chorley, for having put down his Amendment in order to give me the opportunity to deal with the rumour which he told me existed. There is no foundation at all for this rumour. I have been in close consultation with the Law Commission on this Amendment, and they have told me it is in line with their general thinking on the whole subject of exclusion clauses, and the Amendment in this form will not embarrass them in their work in any way at all. I am grateful to my noble friend for giving me an opportunity to make that clear.

Clause 3, as amended, agreed to.

Remaining clauses agreed to.

House resumed: Bill reported, with Amendments.