§ 3.23 p.m.
§ THE LORD CHANCELLOR
My Lords, I beg to move that this Bill be now read a second time. In the last Session we had a Bill which, apart from increasing the jurisdiction of the county courts, dealt with a considerable number of different points of greater or less importance concerning the administration of justice. The Bill now before your Lordships carries further the process of modernising and improving the administration of the law. There is inevitably a good deal of technical detail in this Bill; but I shall do my best to concentrate on the essentials.
Part I reconstitutes the Divisions of the High Court. It also makes one urgently needed reform, which the Royal Commission on Assizes and Quarter Sessions thought was required now and without waiting for the major legislation which will be needed in due course to give effect to the Report of the Royal Commission. This will allow the holding of assizes to be dispensed with at places 197 where there is not enough judicial business. When the High Court first came into existence in 1875, it comprised five Divisions. They were the Chancery Division, the Queen's Bench, Common Pleas and Exchequer Divisions and the Probate, Divorce and Admiralty Division. This fragmentation of the High Court was found to be unsatisfactory and the three common law Divisions were accordingly merged into one Division in 1881. since then we have, of course, had only three Divisions: the Chancery Division, the Queen's Bench Division and the Probate, Divorce and Admiralty Division.
Nowadays, it may strike people as very odd to find such a strange assortment as probate, divorce and admiralty proceedings taken by the Judges of a single Division. But this grouping would not have appeared so surprising in 1875. It was then a question of grouping with the High Court of Admiralty the court of probate and the court for divorce and matrimonial causes, which had both been ecclesiastical courts as recently as 1857. The jurisdiction of the newly constituted Probate, Divorce and Admiralty Division was by nature and origin unfamiliar to the ordinary common law and chancery courts. The lawyers who had practised in the old ecclesiastical courts were specialists, doctors and proctors and even had their own Inn, known as Doctors' Commons, as your Lordships may remember from the pages of David Copper-field.
In 1875, and indeed for long after that, there was so little matrimonial business that no one would have dreamt of constituting a Division of the High Court especially to deal with it. Indeed, the designers of the Law Courts no doubt thought that they were providing for all future time in providing for four divorce courts when the Division consisted solely of the President and one Judge—now there are the President and 17 Judges. It is only in comparatively recent times that the anomaly of the present distribution of work among the Divisions of the High Court has really begun to strike people. It is only during the last few decades that anyone would have thought of ridiculing the present position as A. P. Herbert did when he spoke of the Probate, Divorce and Admiralty Division as 198 that part of the High Court that deals with wills, wives and wrecks.
Nor has it been seriously suggested until comparatively recent years that a Family Division should be created to deal not only with the matrimonial jurisdiction of the Divorce Divison, but also with all the jurisdiction of a family kind which is now fortuitously scattered among the other Divisions of the High Court. In proposing that there should be a reconstitution of the High Court and the creation of the Family Division, we are not simply striving for something that would be tidier and look better on an organisational chart. This is a matter that concerns human feelings and it is most important that all family matters, whether they involve the parties to a matrimonial dispute or the care, adoption, or guardianship of children, should be dealt with in the most sympathetic atmosphere and by Judges and officials who really understand family problems and how to grapple with them. More and more emphasis is now laid on the importance of welfare: the welfare of every member of the family who may be concerned in any domestic case that comes before the courts. So long as the jurisdiction in family matters is scattered in the way that it now is and often dealt with by Judges and others in between other totally dissimilar kinds of business, it must surely be so much harder for those who are concerned to be familiar with welfare matters and keep an eye constantly on them.
My Lords, I should now like to refer briefly to the main provisions of the first three clauses. Clause 1 concentrates in the new Family Division almost every type of jurisdiction of a family kind. I ought to mention in particular the jurisdiction, until now exercised by the Chancery Division, in wardship, guardianship and adoption cases. The whole jurisdiction of the Family Division is conveniently listed in Schedule 1. The clause also assigns the admiralty jurisdiction to the Queen's Bench Division and the contentious probate business to the Chancery Division, but it leaves the non-contentious probate business, which is more of an administrative than a judicial nature, to be dealt with by the Family Division. It will, therefore, continue to be dealt with by the same registrars and 199 staff who have for so long skilfully managed the large amount of business involved. Some would say that the non-contentious probate business should be kept with the contentious probate business and assigned to the Chancery Division; but there is really no need to make such a change, which would, in practice, serve no useful purpose.
It would be possible to reconstitute the High Court by Order in Council made under Section 5 of the Supreme Court of Judicature (Consolidation) Act 1925; but, since the present Divisions of the High Court have been altered only once in the last 94 years—that is to say, 88 years ago in 1881, when the five Divisions originally created were reduced to the present three —I have thought it right to bring the matter before Parliament. It is possible that the power given by Section 5 to alter the number of Divisions of the High Court may be needed in future; but it can be exercised only on a recommendation of the Council of Judges of the Supreme Court. That is a cumbersome procedure in these days when there are so many more Judges. I am therefore taking the opportunity afforded by this Bill to amend Section 5 so that if hereafter any further change were thought desirable in the constitution of the High Court without troubling Parliament direct, it could be made by Order in Council on a recommendation of the Heads of Divisions.
Rather than create a fourth Division of the High Court to deal with admiralty and commercial matters, which would be too small to be viable and which are to be transferred out of the existing Probate Divorce and Admiralty Division, Clause 2 establishes the Admiralty Court and Clause 3 the Commercial Court as separate courts, each forming part of the Queen's Bench Division. As some of your Lordships may remember, we celebrated in 1960 the 600th anniversary of the Court of Admiralty. It is a court with an international reputation, and I share the view that has been expressed that it should be retained as a separate entity.
I now turn to the Commercial Court. Although special arrangements for the trial of commercial cases have existed since 1895, the commercial court as such has never had any statutory status. Clause 3 now remedies this omission. I 200 need hardly say that it will in future be as important as it has been in the past to have Judges who are experienced in Admiralty matters in the Admiralty Court, and Judges who are experienced in commercial cases in the Commercial Court. Clause 3 also enables rules of court to be made which will enlarge the Commercial Court's power to dispense with the strict rules of evidence and to sit in private. This follows the recommendations of the Commercial Court Users' Conference of 1962.
I am sure that it is important, especially in this rather specialised field, to pay attention to the needs and wishes of the section of the community whom this part of the legal system is serving. After all, the courts exist for the people and not the people for the courts. There is no doubt at all that businessmen tend to avoid litigation in the courts because they dislike the formality and publicity of legal proceedings. So they often take their disputes to arbitration, instead of going to the courts. It is most desirable for many reasons, both legal and economic, national and international, that we should do whatever we can—just as Lord Mansfield did in the 18th century—to attract commercial litigation into our courts: and I consider that in genuine commercial cases the desire of the business community for informality and privacy is a legitimate one which should be met so far as we properly can do so. Since most court proceedings are, and must remain, both formal and public, I think that it is right that the special power in relation to the Commercial Court should be regarded as a limited experiment. That is why the Bill itself makes no substantive provision on these points, but merely confers power on the Supreme Court Rule Committee to make such rules of court as it thinks fit. Rules of court must, of course, be laid before Parliament, and are much more flexible and easy to amend in the light of experience than an Act of Parliament.
Clause 4 extends the present power for dispensing with holding assizes which is inflexible and far from adequate. The Royal Commission were critical of the present poor locations of assize courts and drew attention to the serious waste of judicial resources which these cause. They found it difficult to quantify the 201 resulting loss which the nature of the existing system led to, but they said this:… we are satisfied that, in certain circumstances, the loss may be as high as 25 per cent. of the total available court time.They added:Unfortunately much of this lost time is used in travelling to small towns to honour obligations incurred many centuries ago when the disposition of population and communications was entirely different. The result is that travelling is forced not only on the judges but also on the seekers after justice, and, as the courts are not always at the best centres of communication, journeys by public transport may be unnecessarily difficult.Under the present Bill it will be possible to dispense with the holding of assizes for every county and this will enable the Lord Chief Justice to deploy the High Court Judges much more effectively throughout the circuits. Thus, a start can be made—in advance of the main legislation implementing the Beeching Report—on tackling the very serious delays to which the Commission have called attention. I should emphasise that there will be no question of assizes being closed at any place, either for all purposes or for a particular form of business, without my first discussing the matter with the local authority concerned. Thereafter the Order will be laid before your Lordships.
I now come to Part II of the Bill. It is concerned with the enforcement of debt. The Report of Mr. Justice Payne's Committee on the Enforcement of Judgment Debt—a major work comprising no less than 455 pages, for which we are greatly indebted to the learned Judge and members—was presented to Parliament in February of this year. I will mention the Committee's main recommendations, so as to show how they are related to one another and the extent to which it is practicable to give effect to them in this Bill.
First, the Committee proposed the abolition of imprisonment as a means of enforcing the payment of civil debts, though they were divided on the question of retaining imprisonment as a means of enforcing maintenance payments. Secondly, they recommended the substitution of attachment of earnings as a means of enforcing the payment of civil debts. Thirdly, they proposed that the jurisdiction of the magistrates' courts in claims for civil debt such as arrears of income tax, rates, gas and electricity 202 charges and so forth, should be transferred to the county courts. Fourthly, they proposed that enforcement offices, charged with the duty of enforcing orders for money payments made by the courts, should be set up all over the country, and they advocated that these should be responsible, on the application of creditors, for taking appropriate steps for securing that debtors pay what they owe in accordance with their means and assets.
My Lords, it would plainly be impracticable to give effect to all four of these recommendations straight away. Indeed, the Committee recognised that to do so would result in administrative chaos. They advocated that their recommendations should be carried out by stages, and this is exactly what the Government are proposing to do. Part II of the Bill gives effect to two most important recommendations. With certain exceptions, to which I shall refer, it abolishes imprisonment as a means of enforcing the payment of civil debts and it substitutes for that antiquated method of enforcement a system of attaching earnings. The Committee were, as they said in paragraph 982 of their Report,inevitably led to the conclusion that the vast majority of debtors who are actually received in prison under orders of the county courts are inadequate, unfortunate, feckless or irresponsible people; they are, for the most part, not dishonest and do not therefore require punishment;".No doubt because imprisonment has become widely recognised as an ineffective and inappropriate method of enforcement and one that is unjust in certain circumstances, the number of debtors imprisoned under orders of the county court has very substantially declined in recent years. It is only right that I should observe that that process had begun long before attention was drawn to this matter by my appointment of the Committee in March, 1965. Some figures are given by the Committee in paragraph 991 of their Report. These show that in 1962 the number of debtors sent to prison by the county court was 7,913; by 1967 the number had dropped to 3,329. In 1968 the number was further reduced to 2,789. An order committing a debtor to prison can be made only where it is proved to the satisfaction of the court that the debtor has been able to pay, but has failed to pay. 203 The judges have, of course, done their best, in difficult circumstances, to exercise this jurisdiction humanely. However, as the Committee showed, conditions in the courts really do not give them a chance to distinguish between the persistent, dishonest debtors and those who are merely inadequate. The persistent, dishonest debtors may often be clever enough to avoid actually going to prison, while those who are inadequate suffer from their inability to manage their affairs. The sanction of imprisonment serves little purpose and it contributes to the overcrowding of our already overcrowded prisons. This is, I believe, the only country in Western Europe where imprisonment for ordinary civil debt has been retained. And as I think I pointed out in the debate on the gracious Speech, in Scotland they have never had imprisonment for debt; they have always had attachment of earnings. There is, in my opinion, an overwhelming case for abolishing it for ordinary civil debt, but, for the time being at any rate, we must retain it as a way of enforcing the payment of maintenance and the Crown debts, to which I shall refer in due course.
Clauses 5 and 6 therefore abolish the court's power to imprison defaulting debtors in the general run of civil debt cases, retaining it only as a means of enforcing payment of maintenance and Crown debts. The case for distinguishing between maintenance payments and other civil debts can be put very simply. Unfortunately, there are men who, for one reason or another—it may be bitterness—will do anything they can to avoid paying maintenance. Mr. Justice Payne and two members of his Committee, who supported him in recommending that the sanction of imprisonment should be retained for the enforcement of maintenance and comparable orders, said in their Report at paragraph 1039:The selfishness and irresponsibility by which he"—a man responsible for paying maintenance—is motivated are, in our view, no less morally reprehensible and socially damaging in their effects than many offences against the criminal law in respect of which the courts' power to pass a sentence of imprisonment is not questioned".I fear that it follows that to be able to send to prison someone who is deter- 204 mined to avoid his obligations may be the only practicable way of enforcing the court's order. There is another practical difficulty, because a man living, say, in a council house with a wife and children is not going to give up his home and move in order to avoid paying a debt of £20, whereas a man whose home has already been broken up for whatever cause and who may as well live here as live there, may all too easily change his employment and move without notice for the sole purpose of avoiding the continuing payments of maintenance.
The retention of the sanction of imprisonment, for the time being at any rate, for failing to pay taxes and social insurance contributions is, alas! also necessary, because, here again, it may be the only way of enforcing payment. The Crown is, in such matters, in a totally different position from tradesmen and others who may be able to avoid bad debts by not doing business with those who are not considered to be creditworthy. If a person evades his obligations and cheats the taxpayer by not paying his taxes or social security contributions, imprisonment may be the only remedy for the Crown. It is, however, of some comfort that, out of the huge number of people who are liable to pay taxes and National Insurance contributions, only about 30 to 40 are sent to prison each year.
I now come to the remaining provisions of Part II of the Bill, which deal with the attachment of earnings. I fear that they are inevitably somewhat technical and complicated. To simplify the position so far as possible, we decided that, rather than retaining the existing code under Part II of the Maintenance Orders Act 1958 for the attachment of earnings of defaulters under maintenance orders and also making fresh arrangements for the attachment of earnings for civil debts, it would be easier for users of this legislation if we replaced most of the provisions of Part II of the 1958 Act and had the composite code which your Lordships will find in this Bill.
Clause 7 empowers the High Court, the county court and the magistrates' courts to make attachment of earnings orders in their various spheres to secure the payment of civil debts. As the Payne Committee recognised, we could not abolish imprisonment without substituting 205 another means of enforcement and the attachment of earnings is undoubtedly the best means that could be devised. For this course the Committee had strong support from professional bodies of different kinds and also from individuals. There were few objectors. Your Lordships may remember, as I do, that in 1958 the trade unions objected very strongly to attachment of earnings and it is interesting to observe that, now the T.U.C. has reported, having consulted all the trade unions, there was only one union which objected. As it is now working in the magistrates' courts, the system of attaching earnings is not all that could be desired. This is largely because an attachment order is discharged when the debtor leaves his employment. The Bill corrects this defect among others to which the Committee drew attention.
Clause 7 gives the High Court power only to make orders for the attachment of earnings to secure payments under the court's own maintenance orders. It gives the magistrates' courts power to secure payments under their maintenance orders and in criminal matters. But otherwise it is left to the county courts to deal with all applications for orders to attach earnings, so that they, and only they, will make such orders for the enforcement of judgments for the recovery of civil debts, taxes and other Crown debts. Clause 8 is concerned with machinery. It shows who may apply for an attachment of earnings order. Among those who may apply are, as the Payne Committee recommended, the debtor himself, if it is a case of securing maintenance payments.
Under Clause 9 an attachment of earnings order has to be directed to the person who appears to be the debtor's employer. It will, in effect, be an instruction to him to make periodical deductions from the debtor's earnings and pay them to the collecting officer of the court. In making the deductions he must follow the scheme set out in Part I of Schedule 4. At first sight, this scheme looks rather complicated but employers will be supplied, as they now are where attachment orders are directed to them under the Maintenance Orders Act 1958, with instructions which explain the system as simply as possible. We have, indeed, made every effort to devise a scheme which will give employers no more trouble than is absolutely necessary.
206 The scheme for the deduction of maintenance payments remains, so far as the employer is concerned, broadly the same as that under the 1958 Act. But the scheme which is set out in paragraph 5 of Schedule 4, and which operates in the case of attachment orders to secure the payment of judgment debts or payments under administration orders, is a simplified version of the present scheme under the 1958 Act. The difference between the two is due to the fact that, whereas maintenance payments, until they are varied or terminated, continue, civil debts are for finite amounts. In the case of attachment orders to secure the payment of finite amounts there is no need to take the maximum possible amount from the debtor on each application, as is necessary in the case of maintenance payments, so as to meet current liabilities and accrued arrears.
Under Clause 9 the attachment of earnings order will give the employer the name of the debtor and sufficient particulars to identify him or her, the normal deduction rate, the protected earnings rate and, in the case of orders made to secure payments other than maintenance payments, the whole amount to be collected. This information will give him all the information that he needs to comply with the order.
On the first pay day after the order comes into force, the employer will be concerned with three amounts: first, the attachable earnings, which are the debtor's gross earnings less any tax or insurance contributions or superannuation deductions. These the employer would have to calculate even if there were no attachment of earnings order, so that we are not so far adding to his troubles; secondly, the normal deduction, which is the amount which would represent a payment at the normal deduction rate in respect of the period since the last pay day. In effect, this means that, where the normal deduction rate is £X a week and the debtor is paid regularly each week, the normal deduction will be £X; and thirdly, the protected earnings, that is to say, the rate below which, having regard to the debtor's resources and needs, the court thinks it reasonable that the earnings actually paid to him should not be reduced.
207 The employer will, therefore, be able to ensure that the debtor is left with an amount that does not drop below his protected earnings. Provided that the attachable earnings exceed the protected earnings, he will pay to the court whatever remains, not exceeding the normal deductions. Before doing so, the employer may first take Is. towards his clerical and administrative costs. Under the 1958 Act an employer may only deduct 6d. on each occasion for his trouble; but we recognise that that is now insufficient.
Clause 10 requires the employer to comply with the order if the debtor is still with him. If, however, the debtor is not in his employment or subsequently leaves his employment, the employer is required in not less than ten days to notify the court. This will help in achieving the Committee's object in tracing the debtor to his new employment and in preventing him from escaping from his obligations.
The priority as between orders that an employer with more than one order must observe is given in Part II of Schedule 4. Here there are two basic principles. First, an attachment of earnings order made to secure an ordinary debt or payments under an administration order will take second place to an attachment of earnings order made to secure maintenance payments and criminal debts. Subject to that, an employer who is required to comply with more than one order has to deal with them according to the dates on which they were made. Clause 11 prevents a creditor from pursuing any other remedy against the debtor when he is granted an attachment of earnings order which is still in force.
Clause 12 is important. It is designed to avoid another defect of the present system to which the Committee called attention. Under it an attachment order does not come to an end when the debtor changes his employment, but merely lapses and may be redirected to the new employer. This, coupled with the provisions about notifying the court of changes of employment, will, I believe, be of real value to creditors. Clause 14 gives the court an essential power to order both the debtor and the employer to supply information as to the debtor's employment, earnings and commitments.
208 The Committee also recommended, in paragraphs 1218 to 1223 of their Report, setting up a social service office to help debtors. It is however right that I should say that the county court registrars and members of their staffs are extremely considerate to debtors and give them valuable advice and help when they are in trouble.
There are also welfare officers employed by the local authorities, the Citizen's Advice Bureaux and so forth; and in a number of courts, especially in the London area, there are some voluntary welfare workers who are doing most useful work, which is very much appreciated by the judges and registrars of the courts. This does not, of course, amount to the kind of service that the Payne Committee contemplated; but for the time being there is a very great shortage of people trained in welfare work and it would not be practicable to introduce an additional service.
Clause 15 imposes on the debtor the duty to notify the court in writing of every occasion on which he changes his employment and he must tell the court of his earnings and anticipated earnings. The new employer who becomes aware of the existence of an attachment of earnings order is likewise obliged to inform the court in writing and state the debtor's earnings and anticipated earnings.
Clause 18 makes it, subject to certain defences for the employer, an offence to fail to comply with any requirement of the Bill concerning attachment orders. This clause gives the county courts power to secure the debtor's attendance when an application for an attachment order is being considered, and it gives the High Court and the county court power to punish for offences in respect of their own proceedings. I do not think I need say anything about the remaining clauses in Part II of the Bill.
Part III of the Bill gives effect to the recommendations of Lord Justice Winn's Committee on Personal Injuries Litigation about what is commonly known as "third party discovery". For the benefit of those of your Lordships who are not lawyers, I ought to explain that discovery is a means by which a party to litigation can call upon his opponent to disclose any documents which he has in his possession relating to the matters in issue and to produce them for inspection. At 209 present an order for discovery can be made only when proceedings are pending and it can be made only against another party to the action. The Winn Committee thought that in personal injuries cases it ought to be possible to obtain an order before any proceedings are begun. They also thought it could sometimes happen that a person other than a party might have in his possession a document with an important bearing on the case. It might, for example, be a medical record kept by the hospital where the plaintiff had been treated, or a report made by an expert on some machine which the plaintiff was operating at the time of the accident. They accordingly recommended that the court should have power to make an order for discovery on an application made before any proceedings had been commenced and that it should be possible to obtain an order against a person who was not likely to be a party.
Clause 23 and subsection (1) of Clause 24 give effect to these recommendations. The first enables the court, before the commencement of proceedings for personal injuries, to order a person who is likely to be a party to the proceedings to disclose any documents which are relevant to any issue likely to arise out of the claim. This does not go quite as far as the Winn Committee suggested, because it does not enable an order to be made against a person who is not likely to be a party to the proceedings. It seemed to me that it might be oppressive if a stranger could be put to the trouble of searching for and producing documents simply to assist in the prosecution or defence of a claim which had not yet been formulated in legal proceedings. Subsection (1) of Clause 24 does, however, enable an order to be made after the commencement of proceedings against a person who is not likely to be a party to the proceedings.
Subsection (2) gives effect to another recommendation of the Winn Committee by enabling a similar order to be made for the inspection, photographing and preservation of property and such like. I am sure that these provisions will be helpful. We have all known of cases, for example, of factory accidents and of a machine being said to be unguarded; and before proceedings can be started and formulated, as soon as the plaintiff's solicitors go along to the factory the 210 machine has been removed—it has been under repair, and nobody has taken a photograph of it. It is cases such as these that these provisions should be able to meet.
My Lords, I now pass to Part IV of the Bill, which deals with actions brought by mortgagees for possession of the mortgaged property. It used to be thought that where the borrower had failed to make some payment under a mortgage the court had power to postpone the operation of any order for possession that it might make, so as to give the borrower an opportunity of making good his default. In 1961 this view was held to be mistaken, but it seemed to me that the matter ought to be further examined, and I asked the Payne Committee to consider whether the court should have power to postpone the operation of an order for possession of mortgaged property. The Committee unanimously concluded that, where the property was a dwelling-house with a rateable value within the limits of the Rent Act (that is, £400 in London and £200 elsewhere), the court should have power to adjourn the application for possession or to stay or suspend the execution of any order that might be made. They also recommended that the mortgagee should be required to bring the proceedings in the borrower's local county court.
I do not think it is really appropriate to define the cases by reference to the Rent Act. The court's powers ought to be exercisable in any case where the premises consist of or include a dwelling-house, whatever its rateable value. On the other hand, I do not think it would be desirable to take away the High Court's jurisdiction in London and force mortgagees to bring proceedings in the county courts which are scattered over the area. That would be of little advantage to the borrower and might be a great inconvenience to building societies and other mortgagees with offices in the centre of London. Clause 28 of the Bill accordingly gives the court power to adjourn the proceedings or to stay or suspend any order of possession in an action by a mortgagee for the possession of a dwelling-house. The power is to be exercisable only for the purpose of giving the borrower an opportunity to pay any sums due under the mortgage or to remedy any other default he has made, and the 211 court may impose conditions with regard to payment of those sums or remedying the default. I anticipate that where the borrower has fallen into arrear with his payments under an instalment mortgage, the court will make an order for possession within, say, 28 days, and suspend it on payment of the current instalments and so much a week or month off the arrears.
Clause 29 gives the county court exclusive jurisdiction where the dwelling-house is outside Greater London and its rateable value does not exceed £400. Clause 30 ensures that the jurisdiction of the county court is not ousted by the joinder of a claim for money exceeding £500—the present limit in an action of contract or tort. If time permitted I could satisfy your Lordships beyond doubt that this is a position which is causing considerable hardship, and that in many ways a man who virtually owns his house is less secure than a council tenant. A man may be buying his house through a building society and may want to raise £150; and he does this on second mortgage. He has paid most of it back, but because he falls ill or out of work he cannot pay £30 "on the nail", so his home is sold off. The court has no jurisdiction to inquire whether, if he were given a couple of months, he would be able to pay. Some mortgagees in that position are, in effect, money lenders and are not always inclined to take a reasonable course.
I need not detain your Lordships long with the remaining provisions of the Bill. Clause 32 deals with the recovery of costs awarded by assizes, quarter sessions and appellate criminal courts. It provides for them to be recoverable as sums adjudged by magistrates' courts to be paid as a civil debt. Clause 34, together with Schedule 8, provides in effect for legal aid contributions in criminal cases to be subject to the same enforcement provisions as maintenance payments. Clause 35 gives effect to a recommendation in paragraph 1168 of the Payne Committee's Report that the rate of interest on judgment debts should be increased so as to produce a commercially acceptable return. At present it is fixed at 4 per cent. by Section 17 of the Judgments Act 1838. The clause will enable a higher rate to be sub- 212 stituted by Order made by the Lord Chancellor, with the concurrence of the Treasury.
Clause 36 removes the limit imposed on the number of judges and registrars who may be appointed to a county court district. The maximum is now two, except in London where three judges may be appointed to a district. In recent years there has been a considerable increase in the number of judges and registrars owing to the enlargement of their jurisdiction. The busier courts now have their full complement of judges and registrars and it is inconvenient not to be able to increase their number in certain districts. Clause 37 makes it clear that a deputy registrar of a county court does not commit an offence by being engaged as a solicitor in proceedings in that court, so long as he does not act as deputy registrar in relation to those proceedings. This is already the rule in the case of deputy district registrars of the High Court.
My Lords, there is one other matter to which I should like to refer, and it concerns Clause 4. It is true that Clause 4 makes the first legislative change recommended by the Royal Commission on Assizes and Quarter Sessions. If, instead of being unanimous on every recommendation except one, the Commission had been divided, and had not yet reported because they were still arguing what recommendations they should make, I should still have asked the House to include Clause 4 in this Bill, because, my Lords, we are approaching a breakdown in the administration of justice. The reasons for this are the very ones which led the Government to appoint the Royal Commission. They are the reasons set out in the Report of the Judicature Commissioners of 1869. Things have simply and steadily been getting worse and worse, particularly so since the great increase in both criminal and civil work—and especially criminal work.
The principal defect (which in a sense it did not need the Royal Commission to point out to us, because we all knew it) is the extreme inflexibility of the present system, and particularly the fetter—which Clause 4 would remove—of the obligation to hold assizes in every county twice a year, whatever the state of business. This means that, months and months in advance, all the dates have to 213 be fixed for all the assizes, including all those we have had since the reign of King John—places, in some cases, which are really large villages with only 1,500 inhabitants. The dates have to be fixed at a time when nobody has any idea whether there will be more cases to try in place A or place B. Between all these small places there has to be a travelling day, and a travelling day at the end of an assize which may only last one day. These are some of the considerations which led the Royal Commission to estimate that in some circumstances our total loss of judge time caused by the inefficiency of the present administration might be as much as 25 per cent. of the judges' time.
What happens in practice is that the noble and learned Lord, the Lord Chief Justice (whom, if I may say so, I am glad to see here this afternoon) tells me, "There are so many cases to try at place X that the number of judges I am sending there cannot possibly get through the criminal cases, let alone starting the civil cases: so I must have a commissioner." A commissioner means either a retired judge, a county court judge or a senior silk, who is vested with all the jurisdiction of a High Court Judge for the purpose of taking cases at that assize. Of course, it is all a question of degree: if this happened twice a year no-one would complain. But it is getting worse and worse, and I have had to tell the noble and learned Lord that I am now finding it most difficult to find the commissioners.
If I ask a busy silk, "Will you sit for a month at Kingston, starting three weeks from now? ", it means that he has to return all the briefs of his clients' cases that he was going to deal with, and that they have to find counsel at short notice. If I find a county court judge and ask him to sit as a commissioner, what is going to happen to the cases he ought to be trying? This would be robbing Peter to pay Paul; for then I should have to find a deputy county court judge. Last year I had to find a thousand days' worth of deputy county court judges. Since September I have been called on to find commissioners for four weeks at Liverpool, four weeks at Manchester, three weeks at Reading, six weeks at Chelmsford, three weeks at Norwich, five weeks at Aylesbury, another two weeks at Manchester, six weeks at Reading, five 214 weeks at Kingston, five weeks at Liverpool, four weeks at Bristol, four weeks at Newcastle and four weeks at Manchester. People are entitled to have their cases tried by judges, and not by barristers; High Court at assizes is the highest jurisdiction of the court of trial, and something has to be done.
My Lords, I thought I should like to make the position quite clear, because I have heard the criticism that in including Clause 4 in this Bill we are beginning to implement the Beeching Royal Commission's Report when we have not yet discussed it. The fact is that, while this was one of the recommendations of the Royal Commission, we have now arrived at a state of affairs in which we face a real breakdown in the administration of justice unless this Clause 4 is passed. Therefore, even if the Royal Commission had not reported, I should be still asking the House to agree to this clause. My Lords, I beg to move.
§ Moved, That the Bill be now read 2a. —(The Lord Chancellor.)
§ 4.7 p.m.
§ LORD ILFORD
My Lords, I am sure that noble Lords in every quarter of the House will wish me to express to the noble and learned Lord the Lord Chancellor our appreciation of the very clear and, if I may say so, fascinating and interesting story which he has told us in support of this Bill this afternoon. It is a very complicated measure. Having listened with the best assiduity that I can command to the noble and learned Lord I am still not quite clear whether this is to be the end of the assize system, or whether it will still continue in some modified form. I hope that the assize system will come to an end. The assize system has clogged and handicapped the working of our judicial institutions for generations, as those of us who have practised in the courts know very well. It has been bolstered up in the Reports of more than one Committee or Commission; it has been shielded with all its inefficiencies and it has lasted too long.
From the tone of the noble and learned Lord the Lord Chancellor this afternoon I hope that it is his intention that the assize system—or at least its worst aspects—shall be removed from our judicial institutions. Knowing the taste for change and progress which has always 215 animated the noble and learned Lord I felt convinced that he would produce proposals which would seek to sweep away the inefficiency and dilatoriness of our judical system. I am sure that that will be the view of all who practise in the courts and of those who have been penalised by the inconsistencies and the dilatory character of our judical institutions.
I had always anticipated that the noble and learned Lord on the Woolsack would bring forward a new judicature measure comparable with the great Act which has governed our destinies now for nearly 100 years and that the noble and learned Lord himself would be acclaimed as a new Lord Cairns come to judgment. Whether the present Bill will bring about these changes in our judical system, which has awaited reform too long, I cannot say until I have had the opportunity of examining it in rather closer detail than has been possible up to now. This is a highly complicated Bill. It includes many different matters collected from the Reports of different Commissions at different times. It is a Bill which I think will best be discussed on its Committee stage. We shall, no doubt, all of us, whatever approval we may give the Bill as a whole, have points, of sometimes minor substance, which we shall desire to debate on the Committee stage. Your Lordships will probably find that the Committee stage will last some time. I do not propose to occupy your Lordships' time this afternoon by endeavouring to deal with the details of different matters which this Bill includes. It would be much better, as I said a moment ago, that they should wait for the Committee stage. All that I propose to do is to pick out one or two aspects of the Bill upon which I think some further comment may be desirable.
May I first of all say a word about the reorganisation of the Supreme Court. Certainly, the most striking feature of the proposed reorganisation will be the creation of the Family Division. I hope that the Family Division will live up to the reputation which has been prepared for it. It will, I am sure, advance the administration of justice in all those cases which have a bearing on family life if they are brought together into a single Division of the High Court. Certainly 216 they look much tidier under one name. Whether in fact the pattern will be as tidy as it is hoped it will be when it comes into being, or as its name would suggest, it is difficult to say. But there it is. It is a bold experiment, and I am quite sure that all your Lordships will wish it well.
The next matter to which I desire to refer is the continuation of the Admiralty Court. I am glad that it has been decided to continue the Admiralty Court with its separate name. The Admiralty Court is a very delicate plant indeed. Foreign shipowners and foreign underwriters are very ready to come to London for their disputes to be decided by the Admiralty Court, provided that they get two things. First, they want the Judges in the Admiralty Court in whom they have complete confidence. By that I mean Judges who possess the necessary specialist knowledge which is needed for practice in that highly technical court. The other thing that foreign litigants require in the Admiralty Court is that they should be able to fix firmly the day on which their cases can be tried. They have stronger reasons for that than have ordinary litigants, who of course have the same desire. In the Admiralty Court the need for a fixed day is of special importance because the matter entails keeping a ship back. If witnesses have to be detained on shore until a trial is possible, it may keep the ship back some days. Therefore, subject to those two conditions, I am sure that the Admiralty Court is a valuable feature of our judicial institutions, and I am delighted that the Government have not surrendered to the forces—and they are quite numerous—who have advocated that the Admiralty Court is out of date and should now be brought to an end, and its jurisdiction exercised by the Queen's Bench Division.
May I now turn for a moment to Part II, which deals with the enforcement of debt? As the noble and learned Lord the Lord Chancellor pointed out, the proposals in Part II concerning enforcement of debt mean the end of imprisonment for debt in all classes of maintenance cases and in the case of other orders; but it does not mean the end of imprisonment for debt in the case of failure to pay income tax or to pay a Crown contribution. If imprisonment for debt can be abandoned in the case of an ordinary 217 civil debt, why cannot it be abandoned in the case of non-payment of income tax? The noble Lord the Lord Chancellor endeavoured to differentiate the merits of the two things. He said, "Well, an ordinary tradesman can avoid bad debts if he conducts his business carefully"—and so of course he can. But I should have thought that, if imprisonment for the enforcement of debt is abandoned in the case of civil debt, its abolition might at least be tried as an experiment in the case of Crown contributions. It seems anomalous that a man who does not pay his income tax goes to prison, while a man who does not pay his grocer does not. I hope that at a later stage we may consider this matter again.
The next question I come to is one which in some ways is perhaps a minor matter better dealt with at the Committee stage, but I should like to say a word about it this afternoon. I refer to Clause 28, which gives effect to the recommendation of the Payne Committee that where a mortgagee is being threatened with eviction he can apply to the court, and the court will have power to adjourn the proceedings or to make an order to suspend the execution of judgment or to postpone the date of delivery of possession. The Payne Committee coupled that recommendation with a recommendation that, in the case of local authority houses, this new power to adjourn the proceedings or to postpone execution of proceedings should not apply. It is quite true that in their recommendation the power to suspend proceedings was restricted to dwelling-houses to which the Rent Act applied. The local authorities have no houses to which the Rent Act has any application. Their houses are all free of the Rent Act. The Payne Committee recommended that, for that reason, the power to suspend an order in the case of a local authority house should not be given.
It is true that the Payne Committee put their recommendations on the basis that the house was rent-controlled. Does it make much difference? After all, local authorities are public bodies; they are bodies with very close contact with the public. There are some differences between the type of person who obtains a local authority mortgage and the type of person who does not. As a rule, a person who goes to the local authority 218 for a mortgage is the last man on the list and perhaps the tenant who is most likely to default in his mortgage repayments. I should have thought that these cases might well have been left to the discretion of local authorities. I hope they will be, and that at a later stage we may ensure that the local authorities are not handicapped, as I think they would be handicapped if these orders could be made in the case of their dwellinghouses.
That is all I desire to say this afternoon. I am sure that your Lordships in all parts of the House will give this Bill your blessing. We shall do our best to improve it at the Committee stage, and we shall look forward to getting, in our later deliberations, the assistance which we normally get from the noble and learned Lord on the Woolsack.
§ 4.22 p.m.
§ LORD LLOYD OF HAMPSTEAD
My Lords, like the noble Lord, Lord Ilford, I would begin by expressing my appreciation of the characteristically illuminating way in which my noble and learned friend the Lord Chancellor has presented this Bill to us this afternoon. It is of course very much a miscellaneous provisions Bill, and for my part I propose to concentrate entirely on Part II, dealing with the enforcement of debts. I do this not because I fail in any way to value the importance of the other parts of the Bill, but because I do not wish to take up too much of your Lordships' time and it seems to me that it is this Part which calls for particular comment.
By way of introduction I should like to begin by paying my tribute to the work of the Payne Committee, which laboured for nearly four years on this extraordinarily difficult topic and produced this massive Report, containing a vast amount of detailed information, the result of their prolonged investigations and an array of extremely practical and constructive recommendations. In the last Session I put down a Motion aimed at a consideration of the recommendations of this Report, the idea being that it was perhaps desirable for your Lordships' House to explore the whole field before the Government became committed to particular legislation. Unfortunately there was not time for that Motion to be debated, and therefore now, for the first time, we find ourselves considering the provisions of this Report. 219 I propose to say very little about the question of imprisonment for debt because I think there will be few who will quarrel with this recommendation, so far as it goes. I say "so far as it goes" because perhaps this is something on which one can use the phrase of Mr. E. M. Forster, "two cheers" for the Government for almost abolishing imprisonment for debt!
In some ways it is ironic that this is the centenary year of the Debtors Act 1869—the Act which purported to abolish the old debtors' prison. Well, of course, it did abolish the successor to the Marshalsea. I think the Marshalsea was actually abolished in 1842, but it had its successors. However, the Act did abolish the debtors' prison, in the sense immortalised in the pages of Dickens's Little Dorrit, where I am sure it is familiar to all of us. But it did not get rid of the whole notion of imprisonment for debt; and, as I say, it seems ironic that to-day, 100 years later, we are carrying out this measure but even now are not totally abolishing imprisonment for debt. There still seems to be a certain reluctance, as the majority of the members of this Committee pointed out, to recognise, even at the present day, that imprisonment is something which ought to be directed to criminals and not to debtors. So we are still going to retain it, at any rate for the time being, as the noble and learned Lord on the Woolsack has told us, in regard to maintenance defaulters and debts due to public authorities.
The matter on which I wish to dwell a little longer this afternoon is the main recommendation of the Payne Committee, the setting up of enforcement offices to deal with the whole problem of the inveterate debtor. The Committee stress in their Report that it is vital, if we are to implement the proposal regarding attachment of earnings, at any rate to take steps to initiate a new system of enforcement offices. The Committee emphasise that this is a complex administrative matter which cannot be done at one blow, but they also emphasise—and this is a unanimous recommendation—that it is vital to take the first steps and to get this machinery going.
The importance of this basic recommendation is the need to get rid of the present system, or lack of system—it 220 could perhaps be more appropriately described as a kind of legal jungle, where there is a multiplicity of courts and procedures for enforcing judgment debts. What we want to be able to do is to stop creditors engaging, as they now do, in a "disorderly free-for-all, and catch-ascatch-can", as the Report describes it, and, by setting up an adequate procedure, to permit account to be taken of the social and financial position of the debtor and his family. Under the sort of system recommended by the Payne Committee there would be an enforcement officer who would be on the spot to inquire thoroughly into the debtor's means and his other commitments, and it would be possible to see that the debtor was required to pay instalments according to his means and that the money obtained was allocated fairly among the creditors.
The core of the problem, as the Report repeatedly stresses, is the so-called multiple debtor: the feckless person who is quite incapable of properly managing his own affairs. He owes money in all directions—for rent, rates, heat, lighting, hire-purchase, and all sorts of other things. Under the present so-called system it is the creditor who gets in first who may get something, or it may be a committal order for the imprisonment of the debtor. But the creditor who gets in first may be the least deserving creditor; and in this connection it is particularly alarming to note that the county court, which was originally devised as a poor man's court, has now very largely turned into a court that is used by firms to bring proceedings to recover debts against individuals.
In a considerable proportion of cases—and there is ample material to support this proposition—credit has been given to people who have a long record of default, without any inquiries being made as to their creditworthiness. Indeed, a recent survey which was carried out by a body called "British Debt Services", which is a large credit-reporting and debt-collecting agency, has shown that, of defaulting debtors, nearly 58 per cent. have a previous record of default, and that—and I quote the words of this survey:Too many firms did not take the simplest steps to check a customer's credit record and were overwilling to gamble on whether or not he would pay up.221 Of course it is often that sort of creditor who gets in first and obtains an order against a multiple debtor.
My Lords, if we are to have an attachment of earnings system without the correlative enforcement office procedure which the Payne Committee recommend, considerable dangers will arise. For one thing, the wrong type of creditor, having been given this very powerful weapon of attachment without providing the means of ensuring that the weapon is justly deployed, both as regards the debtor himself and the other creditors, may well find himself in a very powerful position indeed. Surely this would be a great pity, because it might serve to discredit the whole attachment system, though the attachment system itself, if linked to something like the enforcement office, might prove to be a very valuable social reform.
Again, one of the dangers is that the effect might simply be to increase the financial troubles of the feckless kind of debtor with whom we are concerned. Under existing procedures, which will still go on merely with attachment of earnings added, the court is rarely in a position to ascertain the true state of affairs of the debtor, and the result is that orders tend to be made without any real regard to the true financial position. Attachment orders may, therefore, be made almost automatically, and this will impose deductions on the pay packets of the particular debtor which will simply serve to augment his financial disorders and ultimately result in total disaster for him. So that, far from resolving the underlying social problem, it may simply add to it.
I should like in this connection to refer to something in the Explanatory Memorandum which I confess I find a little puzzling. At the end of that Memorandum, at page iv, we are told that the number of attachment orders is estimated as being possibly 100,000 a year. Though I do not know how this figure is arrived at, and the Explanatory Memorandum does not tell us, it would seem that it is based on the assumption that we are going to have the same number of attachment orders as we now have committal orders, because it appears that at the present time about 100,000 committal orders a year are made.
222 If this is so, I confess that I view with a certain amount of alarm and despondency what may be the underlying thought behind this suggestion. Under the present system, with the best will in the world—one knows that county court judges all over the country strive to do their best under this very inadequate debt-collecting system—the tendency of many courts is virtually to make a committal order as of course, on the basis that that is the best thing to put pressure on the debtor to make him pay up. In other words, the present procedure is used as a sanction, and the implication of this observation in the Explanatory Memorandum—I may be wrong about this—seems to be that it is contemplated that the new attachment order will be used in much the same way. If that is so, I would venture to suggest that it is providing quite the wrong sort of guideline to our judicial authorities as to the way the attachment order ought to be used.
The whole underlying philosophy of the Payne Report, as I understand it, is that attachment of earnings should not be a sanction but should simply be part of the process of debt collecting. There will be a full investigation as to the true position of the debtor. The court should then try to make the order which is best adapted to the debtor's potentialities of payment, making appropriate instalment orders and so forth, and attachment should only come as the last resort and not as a sort of initial sanction. The publication of this figure of 100,000 in the Explanatory Memorandum, without any explanation of how it is arrived at or what it may be related to, may well constitute an encouragement to regard the attachment order as a kind of sanction, and indeed as a first step rather than a last step in relation to the debtor.
May I venture to draw attention to another point in this Explanatory Memorandum which also causes me some slight puzzlement? It is stated in the last part of the last sentence that if that number of attachment orders were made it is estimated that the net increase in cost to the Exchequer would be around £70,000. No explanation is given to us as to how this calculation is arrived at. I am a little puzzled by this, because it seems to me that the mere abolition of imprisonment for debt must afford an 223 enormous saving in a variety of ways. It appears from the calculations of the Payne Committee that they estimate that keeping a man in prison for debt costs the State about £28 a week. There will, in the new system, also be immense savings in the judicial and administrative expenses which are required in operating the present system. So one is a little puzzled why it is that we are told that even this limited measure of advance is going to cost something of that order.
I would draw attention to another of the Payne recommendations, and that is in relation to harassment. Your Lordships may recollect that when the Rent Act 1965 was passed, a very useful and important new principle was introduced into that Act—namely, the offence of harassment as between landlord and tenant—to try to restrain some of the Rachmanite types of activity and to give tenants protection. Although that provision may not have worked perfectly, it has undoubtedly done a great deal of good. Following that analogy, the Payne Committee have discussed the question of harassment in regard to debtors and they point out that there is ample evidence, and they give a good deal of it, that under the existing system unscrupulous creditors are often disposed to, and do in fact resort to, strong arm and terrorist tactics to get their money, as they see it, from their debtors. The Report gives many instances of this.
But the Report goes on to point out that if imprisonment for debt is abolished, there is a considerable danger that that kind of thing may develop on a still larger scale and may become a considerable social problem. The Committee therefore make the very reasonable and comparatively simple recommendation that a new offence of harassment, comparable to that as between landlord and tenant, should be introduced as between creditor and debtor, and they discuss this in paragraph 1230 of the Report. I would simply ask whether the Government have considered this course, because, even if they are introducing a limited measure without a whole procedure of enforcement offices, there seems to be a case for introducing this provision with regard to harassment.
Here one might perhaps raise a more general issue. One wonders how far the 224 members of the Payne Committee have actually been consulted in regard to the implementation of the provisions of this Report. Although the Committee, having reported, no doubt no longer exists as a Committee, it seems that the Government are failing to take advantage of the benefit of having a group of highly expert people who have given their detailed attention to a matter over a period of years if, when they come to the question of introducing legislation, they do not continue consultation with that body in order to see how far they are succeeding in interpreting the philosophy, apart from the detailed provisions of the Report. In this kind of case one wonders how far the members of the Committee are really still made use of (as I am sure they would be only too willing to be, if consulted) in advising the Government not only as to the initial recommendations but as to their implementation.
I am afraid that I have taken up more of your Lordships' time than had been my intention, but it seems to me that this is a question of great social importance. For my part, in so far as one can say it is an abolition, bearing in mind the remaining pockets of resistance, I welcome the long-delayed abolition of imprisonment for debt. I welcome, too. though with some reservation, the alternative system of attachment of earnings. But it seems to me that one is obliged to express considerable concern about the failure of this measure even to begin to initiate a comprehensive system of enforcement offices without which the whole basis and purpose of the Payne Report is eroded.
Whatever other views one may have about this Parliament—and one knows there are differing views—I think most impartial people would accept that this has been a Parliament representing a great era of law reform. This is largely attributable to the remarkable energy and efforts of our present Lord Chancellor. It is, however, fair to say that this great era of reform has been one which has so far concentrated mainly on substantive rather than procedural law, and many people, both inside and outside the legal profession, share the view that the real hard core of the problems are procedural rather than substantive.
It is, therefore, some consolation at any rate to feel that we are now beginning 225 to tackle that hard core. We have had the Royal Commission under Lord Beeching; we have had certain other procedural reforms, and now we have at any rate a beginning being made on this great area of mediawal, archaic produre which besets our whole enforcement process. Though I regret to say that the Government have not had the courage to grasp the nettle and at least begin the process of setting up the enforcement offices, one can only express the hope that the acceptance, at any rate in part, of the recommendations of the Payne Committee will constitute a spur which will induce them to apply themselves to these broader aspects of the problem with that characteristic energy which one associates with the Lord Chancellor and his present Department.
§ 4.45 p.m.
THE LORD BISHOP OF LEICESTER
My Lords, I hope your Lordships will show forbearance if, before I address myself to this matter, I spend just one moment of paying a tribute of respectful remembrance to the late Lord Carron. It is not often that a noble Lord who speaks in the House on one day has passed away by the time we meet the next day. Lord Carron was a devout member of a Church other than my own, but I know that he took a great interest in any efforts that were made in the Church of England to bring sweetness and light into the difficult industrial situation. That is why I felt it my duty to say just one word of respectful remembrance concerning him.
My Lords, with regard to the matters which we are now discussing and which have been so lucidly laid before us by the noble and learned Lord on the Woolsack, I should like to say a few words about two matters to which those in the Church who are concerned about social affairs have given their thoughts and have formed opinions. The first matter is that raised in Part I of the Bill, the new naming of a Family Division of the High Court. I am sure that most of us will warmly welcome this provision. The importance of the step should not, of course, be overrated. It falls far short of what has often been suggested namely, the setting up of a whole structure of family courts from the lowest to the highest level, specially equipped for 226 the settlement of family differences and disputes.
It is perhaps curious that it has been thought right to begin this process, if indeed that is what is happening, at the top; that is, by a rearrangement of the business in the High Court. One would have thought it more natural to begin at the bottom, and to bring in family courts at local level, able to absorb much of the work now done in juvenile courts and in the domestic procedures which take place in magistrates' courts. It is unfortunate that appeals from decisions in magistrates' courts on findings of fact in bastardy cases will continue to go, as at present, to quarter sessions where they lose that degree of privacy which is afforded to such cases in magistrates' courts, and where they enter a more or less criminal atmosphere. Similarly, appeals arising out of orders in magistrates' juvenile courts, orders concerning care for the most part, continue to go to quarter sessions where, once more, they will enter a semi-criminal atmosphere.
Three-quarters of all divorce cases outside London are hoard in the county courts. These will continue as before and appeals from them will lie to the Court of Appeal. Thus, the new Family Division of the High Court will not deal with many matters other than those which previously would have been dealt with by one section or another of the High Court. It is nevertheless a considerable gain that the new name for this court should be the "Family Division". This, for the first time in English law, establishes a court specially named and suited to deal with family matters as such; and it is to be hoped that this new court will in time beget courts at lower levels similarly suited to deal with these intimate and largely non-criminal matters. It is particularly desirable that there should be courts to deal with bastardy cases and custody cases which at present still fall to be dealt with on appeal in the quarter sessions.
I now turn to Part II of the Bill, which deals with the question of imprisonment for debt. Here I should like to diverge slightly from the noble Lord who spoke before me and express the view that the Government have been wise not necessarily to bring into force immediately the 227 proposal of the Payne Committee about the setting up of enforcement of debt offices throughout the country. I seem to recall a line of a hymn which speaks about "nations crowding to be born". There are always officials "crowding to be born", and we could easily have immediately fallen for this proposal and set up a whole new branch of bureaucracy. It may in the end prove that something of this kind is necessary, but I think we might well try this new system of the attachment of earnings for a few years before concluding that we have to set up a whole new series of offices of this particularly kind.
I think we must in general protect any Goverment from feeling that it has no option but to accept almost in toto every proposal of any Committee that reports. One of the difficulties of government in our time is that such publicity is given to every new Report that large numbers of the public think that as soon as a Report is published the Government is bound immediately to put the whole of its proposals into force. Any Government is entitled to use its discretion, both as to the number of proposals that it brings into force and the speed at which it does it.
We welcome the abolition of imprisonment for commercial debt. Any step which reduces the overcrowding of prisons, which saves the country from unproductive expenditure, which protects feeble and unfortunate characters from the contamination which is still inseparable from a prison sentence, is to be welcomed, provided that it is not subversive of social and public order. It would have been good if prison sentences could have been removed in cases of failure to pay maintenance charges and social security contributions. Fines and costs in criminal cases are in a different category; they are, in some senses, so far as the fines are concerned, often alternatives to imprisonment, and if the fine is not paid the convicted criminal can hardly complain if he is imprisoned instead.
I find myself in a slight difficulty, and perhaps the noble and learned Lord may find a moment in which to enlighten me. The difficulty is that Clauses 5 and 6, as explained in the Explanatory Memorandum, retain imprisonment for 228 failure to pay maintenance, taxes, social security, fines and costs, and so on, but Clause 7 empowers the courts to make attachment of earnings orders for the payment of civil debts, including social security contributions, fines, and costs. In other words, it seems to me that we now have two alternative proposals over a wide range of debts; what one might call official debts to the State, or to the community. I do not know whether the Bill gives any guidance as to what criteria are to be used by courts in deciding whether or not to use the remaining imprisonment right, or whether to go for the attachment of earnings. If I read the Bill rightly, it is important to see that attachment of earnings is a possible way in which courts can deal with practically all of those debts, including the official debts, for which imprisonment remains as an option. There is to be the alternative to prison of the attachment of earnings, and I personally hope that this will be widely used. We are well aware of objections to it, but some sanctions are clearly necessary in our complex and highly organised society, and it is hard to see a better one than that proposed.
I was rather surprised to hear the noble Lord who spoke before me speaking as though it were wrong to think of attachment of earnings as a sanction. However much it may be used as a sanction, it cannot be so severe a sanction as the threat of imprisonment. If anyone is able to pay, he has the quick answer to the proposed sanction of attachment of earnings—and that is to pay. If he cannot pay, it seems to me that he ought to be thankful to be allowed to pay by instalments, which is really all that is happening in what is proposed. It is not, of course, new to have the right to attach earnings in affiliation and maintenance cases. The former have been legal since 1914 and the latter since 1958. But with the bringing in of commercial debts the whole idea may become far more familiar, both to employers and employees, and to the public generally.
The steps being taken are small, but they are to be welcomed as further steps on the road to that happy state when shutting a man up, disrupting his family life, preventing him from earning his own living, compelling him to mix with anti-social or inadequate companions, will be a course of action resorted to only in 229 the case of dangerous criminals, or those against whom society insists there must be some obvious mark of its disapproval and of its desire to deter others from embarking on similar anti-social conduct.
§ 4.58 p.m.
§ LORD DONALDSON OF KINGS-BRIDGE
My Lords, I am entirely in favour of all that appears in this Bill, except certain things in Part II; and because I disapprove very strongly of these I hope that my noble and learned friend will not think it churlish if I do not spend a lot of time giving praise—which in any case, owing to the fact that my legal education stopped in 1929, would not be very valuable—to the other Parts of the Bill. I was immensely encouraged to have the support of such a learned lawyer as my noble friend Lord Lloyd of Hampstead, who has put forth arguments which I had myself very largely proposed to advance, and I shall try not to repeat them. I was unhappy to find myself disagreeing with the right reverend Prelate almost as much as I agree with the noble Lord.
At first sight, Part II of the Bill seems to be a proper fulfilment of the Payne recommendations. But if one looks closely at it one sees that it is nothing of the sort; it omits the kernel, which is the enforcement offices to be set up in county courts. This is where I find it impossible to agree with the right reverend Prelate that the Government are to be commended for not rushing in. I think they are to be blamed for picking out plums, and leaving the difficult part behind. Part II also fails to impose any restraints on those firms who, when they sell goods on credit, make too little effort to check on the customers' ability to pay and, consequently, sell to people quite unable to pay.
I should like to quote a few lines from the Payne Report to show that I am not exaggerating the case. In paragraph 1003 they say:We cannot reconcile ourselves to the view that it is justifiable to send inadequate or feckless persons to prison, or to threaten them with imprisonment, in order to extract money from thousands of others who have the means to pay.In the next paragraph they say:The Committee do not accept that any benefit to the business or trading community or to the public at large can flow from the 230 creation of bad debts, and if would-be suppliers of goods can be persuaded to make proper inquiries before entering into transactions so as to ascertain whether their customers are, in fact, credit-worthy before goods are supplied, this would be of the greatest benefit to all concerned.These two sentences are the kernel of the Payne Report recommendations, and the point here is that they apply as much to the attachment of earnings as they do to prison. The attachment of earnings is a sanction curiously like prison, in that though it may act as a threat to the dishonest man, and a final sanction, if you like, yet it will catch and destroy the inadequate families without acting as a deterrent to them at all. The "wide boys" are never caught; they borrow from a friend in funds and pay in the taxi on the way to court rather than submit to the final sanction; and other debtors turn to money-lenders. But the type of family which will be caught is the one incapable of managing its affairs, which is simply overwhelmed by the problems of modern life. To send the wage-earner to prison can do nothing but harm; but to advise his employer to dock his wages may well get him the sack, as evidence from the United States shows. These men are, as a rule, unstable employees, and any chance of settling down can be entirely ruined by this kind of thing. In any case, this type of man will agree to any level of deduction you like to suggest, and be entirely incapable of carrying it out.
If, as my noble friend Lord Lloyd suggested, my noble and learned friend the Lord Chancellor had adopted the full panoply of the Payne Report, there would be a properly staffed enforcement office, receiving assistance from social workers, and proper arrangements could be made. But, my Lords, it is very naïve to suppose that a judge or a registrar, however skilled and benevolent, can sit in his court and add up the debts of a family, the total of which they probably do not know themselves, and make an arrangement for repayment which they have any chance at all of keeping. The Bill provides in Clause 14, in a way which I can only describe as hopelessly optimistic, for the debtor to fill up a form stating his means and other debts. If he gets it wrong wittingly or recklessly, the sanction is imprisonment. That seems to me the kind of thing which will frighten inefficient and 231 only partly literate people into making mistakes which they will be unable to defend; and I think it may lead to real injustice.
It is interesting that the employers have not complained about the threat to them in Clause 18, because if they do not carry out properly the deduction from wages they are also subject to the sanction of imprisonment. They seem easier to keep quiet than my right honourable friend Mrs. Castle's employees. The noble Viscount shakes his head. Is that not true?
VISCOUNT COLVILLE OF CULROSS
My Lords, I have had the strongest possible representations from the employers on this very subject.
§ LORD DONALDSON OF KINGS-BRIDGE
I thank the noble Viscount. I did not know that. I will say a word here, my Lords—and this is really the key to the first point that I want to make —about how problem families are normally tackled by an organisation like, for example, the Family Service Units. First, you have to go in and make friends and gain confidence. Then, some time later, you try to collect all evidence of indebtedness—finding bills in odd drawers and demand notes behind the T.V. set, some known to the wife alone and some known only to the husband. Then you add them up, to the astonishment and distress of the housewife. Next you discuss the money coming into the family and the minimum demands for the weekly bills, and decide what amount, if any, can be put aside to clear off arrears. That generally means getting in touch with one or more of the principal creditors and persuading them to hold off for a bit and accept some small instalments on condition that other creditors get similar treatment. After this, you can start the real business of finding out what the non-financial problems of the family are.
The Payne plan, if it were to be carried out in full. envisages that the enforcement offices, with their social workers, would do exactly this; and it is a thing which requires doing. But my noble and learned friend wants to skip all the important part, the enforcement offices, and go straight to the easy part. I tell him now, with all the conviction I can summon, that without the support of a 232 social worker to go into the home and sort out the problems there, the court will be unable to find out what the family's total liabilities are and unable to estimate fairly what it can afford to pay. The court will therefore fix a figure which is not based on the facts, the family will fail to meet its promises, the employer will become fed up with a worker who is always in trouble and at a suitable opportunity will get rid of him, and the family's income will be reduced to unemployment pay. The creditor will not get paid. but the family will be driven still further into the ground.
My Lords, this really is not just a sentimental idea of mine: it is the bitter truth. The Payne Committee tell us that over 50 per cent. of the civil prisoners were in prison for debts of £20 or less. Some years ago I chaired a steering group of Political and Economic Planning for the preparation of a book on prisoners and their families. It was written by Dr. Pauline Morris—not the easiest lady to steer, incidentally—but in spite of the Committee it is the best and most complete study of the subject in this country and, perhaps, anywhere. I recommend to your Lordships Chapter 9, which deals with civil prisoners. The picture it gives there is really pathetic. I will not bother your Lordships with it, but it bears out every word that we are saying: that the people who are going to be affected first by imprisonment and now by the attachment of earnings are the bottom fringe of society. Those are the ones who will be caught, and the attachment of earnings will hit them much more widely than imprisonment.
I think we all welcome (this has been said by every speaker) the recommendation to abolish imprisonment for debt; but I maintain that this recommendation should, and can, stand by itself. It must not be linked with the need to find an alternative sanction. Imprisonment for debt is bad. It is ineffective; it protects nobody but the strong, who should be able to protect themselves, and it inflicts hardship on people who already have more than their share of it. Let us get rid of it, and rejoice. This is where I find myself, unhappily, differing from my noble and learned friend the Lord Chancellor. He said, in effect, that he cannot remove the sanction of prison without substituting another. I do not accept this. The real rogue, who lies 233 about his means, can usually be got for deception or fraud, under the new Theft Act. Firms do not bother to prosecute because it does not get them their money back. But if it is a sanction they want—and this is the main argument—here it is, under their hands. The man who is less than a rogue but a bad payer—and I freely admit that there are a good many such about—can be threatened with destraint, and eventually destrained on.
The Payne Committee say in paragraph 981 that against inadequate families prison has no value as a sanction. Nor, I say, would attachment have any value. The Payne Committee say in paragraph 993 that where a debtor has goods a creditor will first attempt to obtain payment by execution against goods, and only if that fails will he resort to judgment summons. My Lords, I agree. If there is any thing to be had, let the creditor exert his rights. He comes to the court only when he finds there is nothing to be had. In my opinion, the court cannot help him by restitution, only by punishment; and I am quite certain that that is not what my noble and learned friend is attempting to effect. The doctrine of caveat emptor! holds an important and respected position in English law. It is high time we adopted and respected a parallel doctrine, "caveat creditor!"—let the lender beware!
The attachment of earnings is not in itself a very satisfactory process, as evidence from the United States and Scotland suggests. There is strong pressure to abolish it in America—"garnishment", as they call it. The United States Secretary for Labour in 1966 estimated that between 100,000 and 300,000 people a year were "fired" because their wages were garnished. In Scotland, "arrestment", as it is called, was described by a 1958 Committee as working well, but social workers have recently expressed to the Consumer Council a good deal of uneasiness about it. However, if my noble and learned friend would give us the safeguards which the Payne Committee so rightly insisted upon, I should not feel obliged to oppose it. But if we are to have attachment, then at least let us have the enforcement offices, as the Payne Committee recommended.
234 There is another disturbing feature of the Bill as it stands. The attachment of earnings will certainly be more widely used than imprisonment. Happily, judges have in the past been reluctant to employ such a crude weapon as imprisonment if they could possibly avoid it, but a mere financial sanction does not carry the same overtones. I see that the Payne Committee made a rough guess (my noble friend Lord Lloyd of Hampstead referred to it, and questioned its validity) that there might be 100,000 orders in a year—that is, as against 3,000 to 4,000 imprisonments. This is the order of what they think might be the difference in the application of this sanction. One must realise that it would bite, and it would bite on the ordinary commercial debtor in a way in which it does not with maintenance orders. My noble and learned friend has explained that people under maintenance orders have just left their wives and families. They can easily flit from job to job and from place to place. The ordinary debtor, as my noble friend said, has a council house and is easy to find. This attachment will bite on him in a way that it has not bitten on the maintenance debtor.
My Lords, may we pause and consider for a moment whose lives would be affected by this legislation? On the one hand, it would affect the underprivileged, inadequate families of whom I have been speaking and who incur small debts which they ought not to incur. But the system of wage attachment, particularly as proposed in this Bill, will cause hardship to the capable as well as the incapable. I have already mentioned the tendency of American employers to dismiss men whose wages are garnished. Employers here to whom the Consumer Council has spoken are opposed to the system. They do not think it is their job to collect debts for private creditors, and they do not want to know about this part of an employee's affairs. A Scottish employer said that although his firm does not sack a man at the first arrestment, it does finally get around to sacking after repeated arrestments. An English employer said that he might be chary of employing or promoting a man whom he knew to be in debt. This is how a man's livelihood may be affected by attachment. The scheme as proposed in this 235 Bill will exacerbate employers by allowing them to be subjected to successive attachment orders from different creditors, instead of, as the Payne Committee proposed, merely one attachment order for all creditors administered by the enforcement office. The scheme provides no system—as the enforcement office would do—for varying the attachment order for a debtor who falls on hard times.
In aid of whom, and for what, is this legislation intended? Who is going to benefit? What sort of creditor? Two trade surveys recently concluded that bad debts amounted to about 0.5 per cent. of total credit issue. A retail co-operative society in the Midlands claims bad debts of from 0.1 to 0.5 per cent. Some less-reliable figures suggest that about 5 per cent. of the £1,200 million hire-purchase debts outstanding in 1967 was the subject of court action. And some of these debts would have been recovered. It seems that trade as a whole is not plagued with unreasonable losses but that a high proportion of bad debts is a normal expectation in some particular businesses. This is a point which my noble friend has already made.
In giving evidence to the Payne Committee, one county court judge, who has given the Consumer Council permission to quote his words, wrote as follows:An overwhelming majority of the creditors who use the judgment summons procedure are large commercial concerns trading on instalment credit. For them, judgment summons procedure is part of their normal business procedure and the county court and its staff a debt collecitng agency.He went on:These firms habitually give credit without making any inquiries about the credit-worthiness of the debtor, so that sometimes the same creditor is issuing judgment summonses against a debtor while it is persuading that debtor to accept further credit.One cannot go much further than that! An American survey in Ohio showed that two stores accounted for 20 per cent. of all garnishments in the city. Another American survey of nearly 7,000 garnishments showed that three firms were responsible for one-third of them.
My Lords, no-one advocates restriction of the right of people to trade on credit, or of the public to buy on credit, but that these transactions should stand on their own feet. Is it right that the county 236 courts, which cost the nation nearly £3 million a year, should be used as an integral part of their trading by a few firms, as often as not to collect debts which should never have been incurred?
I wonder whom my noble and learned friend consulted before embarking on this very important legislation. I do not doubt that he consulted some of the business interests, but did he consult the other side at all? Did he consult the Probation Service, the Association of Child Care Officers, the various welfare interests for which local authorities are responsible, or any of the other people whose business it is to look after families in distress? I see that something like 18 such bodies gave evidence to the Payne Committee, and the Payne Committee recommendations were brought in after the most careful consideration of the evidence that had been given by these bodies. Has my noble and learned friend consulted them as to what they think? I have behind me the opinion not only of the Consumer Council but also of a hundred social workers working in 17 different branches of the Family Service Units. They differ on many points but are unanimous on two: first, that the onus should be put on to the lender to take proper precautions to find out whether the family can pay or not; and, second, that someone must move in and help the family to put its affairs in order before there should be any question of attachment of earnings.
My Lords, can I, in conclusion, persuade my noble and learned friend to do the following things in the following order? First, will he abolish imprisonment for debt in the terms of the Bill as it now stands. Second, will he introduce a clause into this Bill—or, if this is too naive a solution, make us a promise of future legislation—to deprive firms of the right to the court's protection if they cannot show that they have taken proper precautions to see that the person to whom they are selling goods on credit is in a position to pay. There are already credit reporting agencies to which lenders can refer. These should be improved and the public protected by legislation, as we were suggesting yesterday in this House, from inaccurate inaccuracies. But there is no reason to hesitate before bringing in this kind of negative legislation. 237 Lastly, I would ask my noble and learned friend not to introduce attachment of earnings except with the full safeguards laid down in the Payne Report. I know that there will be difficulty in recruiting the necessary people and in paying for them. If my noble and learned friend would give me a timetable and say that we will begin now and have it in three years from now; if there were any promise of this ever being done, then ! should feel less strongly hostile. But what happens is that the easy thing is introduced, and no Government is ever going to do the other, because it is all very difficult. I beg my noble and learned friend not to introduce this very radical measure until the proper safeguards are put in. I certainly think that this Bill should have a Second Reading, but I hope that it will emerge from this House a good deal modified.
§ 5.17 p.m.
§ LORD MORRIS OF BORTH-Y-GEST
My Lords, although I did not have the advantage of hearing the speech of the noble and learned Lord the Lord Chancellor, I hope that your Lordships will allow me with the utmost brevity to express a general welcome to this Bill. Here is another step, and a notable step, in a process which in these days we are witnessing and which I for one so greatly welcome, the process of giving attention to the machinery and content of the law and the endeavour to make improvements both in the machinery and in the content. There are only one or two points in regard to which I wish to say a word. I think that the new arrangements in regard to the Probate and Admiralty courts are satisfactory. In agreement with what has been said, I feel that the Admiralty Court and also the very much younger court, the Commercial Court, both have high prestige; and I think it is so important that that should be so. In a maritime country the prestige of those two courts should be recognised in other countries and in our own.
I particularly welcome the proposals that are contained in Clause 3 of the Bill in regard to the Commercial Court. It is very interesting to see that the Commercial Court, which began in 1895 and has really just been a court of the King's Bench Division or Queen's Bench Division, is now given statutory recognition. I think that the proposals contained in 238 Clause 3 would much have appealed to those who were responsible for starting this court in 1895. The first judge was Mr. Justice Mathew and a special series of law reports began at the time that the court began to function. The first editor was a son of this judge, Mr. Theobald Mathew, one of the most beloved and distinguished members of the legal profession in recent years. In a very interesting introduction to the first volume of the Commercial Reports he said that the endeavour of judges of the Queen's Bench Division to provide a suitable tribunal and procedure for the ready settlement of commercial disputes was an incident of such importance that it seemed to afford a sufficient excuse for making an addition to the large number of existing law reports.
Mr. Mathew then described in the introduction how it is possible in litigation for the interlocutory procedure to be so protracted and so detailed that there is risk that justice may be delayed or even denied. He said it was manifest that an obstruent litigant indifferent, either from his wealth or his poverty, to the cost of legal proceedings, may in many cases deprive his opponent of effective redress or remedy. He went on to say that the procedure which he had described was particularly objectionable to men of business and under its pressure mercantile causes became few and far between. A dispute with respect to a commercial transaction, like any other matter of business, needs a prompt decision and in some countries special tribunals have been created to ensure dispatch.
In the first volume of the reports we see eminent names. On a very early page we see the name of Mr. Bingham, afterwards a Member of your Lordships' House as Viscount Mersey. We see very soon the name of Mr. T. E. Scrutton who, I venture to think, became one of the great judges of this century. The Commercial Court has always attracted both solicitors and barristers with special skills, and very many eminent men on both sides of the profession have given of their work to the Commercial Court and helped to establish its prestige. 1 am sure that in recent years it has been felt in some City circles, in some commercial circles, that the procedure might be still more adapted to suit the wishes of the commercial community. 239 In this country we are very wedded, and I think rightly, to the general idea that justice should be administered in public. The phrase, "justice behind closed doors" always has a sinister sound, and in general we disapprove of it. But, my Lords, not every dispute is one which need attract the interest or the attention of everyone else; and if commercial men, businessmen, have a dispute which may involve matters which are rather confidential I think that the court ought to be as helpful as possible to ensure not only speed in decision but that the circumstances in arriving at the decision should be as attractive as possible. Therefore, I see no peril at all in giving to the commercial judge, or in conferring on the commercial judge, power to admit any evidence which would not otherwise be admissible under the law relating to evidence. It is the general feeling in these days that we can trust our judges to distinguish between what is worthless and what has value, and I am quite sure that in commercial cases particularly we may be satisfied to entrust that power to the judges.
Then, my Lords, there is thepower to sit in private during any part of the proceedings in a cause or matter entered in that list.There may be times when, though there are not what might be called trade secrets in consideration, there are many matters which are confidential, in the sense that those concerned would not wish every rival to be made aware of their affairs. Here again, I welcome the power given in the terms that I have set out. Indeed, I would welcome any further powers that are designed to bring back to the Commercial Court work that may at times have been going to arbitration. I think it is the general feeling that in the long run it is better for the parties if they begin their proceedings in court, with the opportunities for full appeal if they wish it, rather than that they should begin by arbitration.
My Lords, I confine myself to one other observation at the moment, and that is with regard to Clause 4 of the Bill, entitled:Extension of power to dispense with holding of assizes.240 I raise no objection to that provision. Indeed, I think that in present conditions it is probably almost essential to have that power. But I would ask just one question in regard to it. If the proposals of the Beeching Commission are, in general, accepted—and in a general way I find myself favourably disposed towards them—it may be that in future years there will be some counties, or some areas, within which trials will not normally take place. But there might well be on occasion some cases where there are a great many witnesses in one locality; where the parties are all in one locality, but that is not a locality where assizes normally take place. It might be much better in those cases to bring the court to the locality rather than make the people from the locality go somewhere else. That would happen, I am sure, only on occasion, but reading the words of Clause 4 I would hope that there is not undue finality or rigidity about it, for the words are:…assizes shall no longer be held for such county or at such place…".I would merely hope that there would be opportunity, when occasion made it necessary, to have a special case heard in some special place.
I have in mind in this connection paragraph 278 of the Beeching Commission Report which reads:In making our recommendations we recognise that there may be occasion when, by special arrangement, a High Court or Circuit judge should visit some additional town to meet the convenience of witnesses and others, in long cases, where the majority of those concerned live in areas which are exceptionally remote. Such visits must, however, be kept to the absolute minimum if the defects of the present Assize system are not to re-appear, and will have to be limited to places where suitable accommodation is available. It will also be necessary to ensure that the progress of court business at the normal centres is not unacceptably impeded. It is consistent with this recommendation that we regard the need to specify court centres by legislation, as for example by an Assize Order, as unnecessarily restrictive and running counter to our view that this is an administrative matter to be decided by the Lord Chancellor and varied by him as events dictate.My Lords, it may well be that whatever is done under Clause 4 will not run counter to that thought. I raise the point because the words seem to have a certain air of finality about them. I would hope, and indeed I imagine, that this will be in contemplation and that whatever is done 241 in the near future will not make it impossible, in the circumstances contemplated which might happen only rarely, on occasion to depart from what may be the new scheme of things if the Beeching Reports are in general adopted.
§ 5.30 p.m.
§ LORD PARKER OF WADDINGTON
My Lords, I rise to join with other noble Lords in giving a general welcome to this Bill. As has been pointed out, it covers many subjects. The only subject with which I wish to deal is the powers contained in Clause 4. If I speak with feeling on this matter, may I disclose my own personal interest. Being largely concerned with the day-to-day administration of the work of the courts throughout the country, the position for me at the moment is not merely a headache but a complete nightmare. So long ago as 1964 it was clear that the machine for the administration of justice, both criminal and civil, was going to grind to a halt and I am sorry to say that the position has almost been reached to-day.
At the expense of wearying your Lordships, I should like to explain a little of the present position. At any rate, I think that those who may desire to criticise these powers should fully realise what that position is before they voice any criticism. May I give an illustration by taking first the Birmingham Assizes? There was a time when three judges at Birmingham could clear the criminal work and the civil work in an assize. The position to-day is that with four judges they do not expect to finish the criminal work alone, with the result that they leave from 450 to 500 civil cases, remnants from the previous assize and some of them double remnants. It is a deplorable position.
Take Winchester, again a case where three judges in a three-weeks assize would clear the lists both criminal and civil. This term they started with a two weeks' assize with four judges, followed by eight weeks of a single judge, followed again by an assize of four judges. On Monday that is to be followed by one of five judges, and they will not complete the lists. The position is the same in nearly all the major towns. At Cardiff-Swansea, if 1 may bracket together the two assize towns in Glamorgan, the lists are never completed. Manchester always has a back-log of civil cases. Nottingham is 242 the same, and so it goes on throughout the country. It is not confined to the big towns, because when we get to the smaller towns, though it may be that the crime list is finished, the civil may go untouched, certainly not completed. In that category, I would put towns like Derby, Bedford, Bristol and many others.
Something has to be done about it. At the moment what is being done is mere patchwork. It is like a gardener with an old hose. We send judges down to stop up one leak, only to find it bursts out at once in three other places. All this patchwork is done at the expense of sending judge after judge out of London, so that the arrears of civil work grow in London, and at the expense of having to make request after request for commissioners. My noble and learned friend the Lord Chancellor has already explained the number of commissioners which he has been asked to find this very term, the difficulties involved in finding them and the rather unsatisfactory position of cases being tried by commissioners rather than by High Court Judges. Above all, this is all at the expense of the litigants in civil cases and of the prisoners who have their trials hanging over them, with the result that they either spend too long in custody or, if on bail, unfortunately commit other offences.
The powers in Clause 4 will enable something to be done, and on one view may bring a saving of as much as 25 per cent. of judge power. May I say why? There are many towns in the country where a short period of assize is justified. The period has to be decided in advance, before it is known what the work is. When a judge gets there, perhaps there is one plea of guilty or a five-day trial which he cannot begin because he has to get on to the next assize or perhaps very kindly, in order to please the inhabitants by giving the judge something to do, the quarter sessions have reserved a case for him.
There are 65 assize towns, visited three times a year, and on each occasion there is a loss of a commissioned day, when no work can be done. There is the loss in these small towns when a judge has to go there and is unemployed. There is the other difficulty that the last day of an assize is really only half a day's work, because the judge has to ensure that the 243 last case finishes before he goes on to the next assize town. One has only to mention that to realise that even a slight concentration of work is going to save a tremendous amount of judge time.
The matter does not end there, because the powers being given by Clause 4 enable provision to be made for dealing better with civil work. If one takes a town like Derby (I mention it because I have it on my table at the moment) for three assizes no civil work has been dealt with, and unless some patchwork takes place before next winter's assize it will not be dealt with there. The reason is that the assize is only two weeks, which is ten working days, less a commissioned day, and it is impossible to deal with civil and criminal lists at an assize of such a short duration. There is clearly a case for saying that in such a town the assize should be criminal only and that civil work should be transferred to another town, where a longer period can be spent, where there is proper court accommodation and accommodation for more judges and where the civil list can be dealt with in a smooth fashion, independently of crime, with the obvious advantage of being able to have on occasion fixed days for hearing. That is another power which is being given by Clause 4. It seems to me that something along these lines—and for my part I can think of nothing better at the moment—is a matter of necessity at this moment.
Of course, it is only patchwork, because I am convinced that even a saving of up to 25 per cent. of judge power is not going to get over our difficulties. I very much hope that the time will come when the recommendations of the Royal Commission on Assizes and Quarter Sessions might be implemented. It seems to me that in the long run only the implementing of those recommendations will produce order out of chaos. And when that time comes, I earnestly hope that there will not be—indeed I should be in despair if there were—any controversy about the general principles and general scheme set out in the Report of that Royal Commission. But whatever views people take about that Report, whether or not it is implemented to-day, there is an urgent necessity for doing something about the lines which will be pos- 244 sible as a result of Clause 4. I earnestly hope that not only will this Bill be given a Second Reading, but that Clause 4 will have the complete support of your Lordships.
§ 5.40 p.m.
§ LORD LEATHERLAND
My Lords, I shall be brief. I had not intended to speak, but in view of the criticisms that have been made of the provision for attaching wages, I feel that it should be made clear that there is one small voice on this side of the House which believes that this is an important and desirable reform. I have the greatest respect for the Consumer Council, which has given this matter considerable attention. I have, equally, respect for my noble friend Lord Donaldson of Kingsbridge who is the very able and public spirited chairman of that Council. Nevertheless, I feel that this move in the direction of attaching earnings is something to which we have to look forward and accept.
It is right that we should abolish imprisonment for civil debt. It is a relic of Dickensian days, and is something which is almost a disgrace to our modern civilised society. But we must have some substitute if we are to remove the threat of prison from over the head of a man who will not pay his lawful debts: otherwise he will merely laugh at you. Presiding over a magistrates' court, I have known many cases where we have had non-payers before us—non-payment of fines, and things like that—and though it may not be particularly germane to this clause in the Bill, one finds that there are people who really will spend their money foolishly and extravagantly on motor cycles and motor cars, but they do not feel they are honour bound to pay any penalty that has been awarded against them. It has been suggested that distraint might be a remedy in these cases. It would not in many cases, because in lots of cases of distraint you are merely visiting the punishment upon the wives, mothers and children in the home, and not upon the rather irresponsible person himself. I feel that with this threat of attachment of wages hanging over the man's head he will not want his employer to know and, therefore, will make an effort to pay what he is properly required to pay. 245 I know that there are difficulties in operating the machinery of attachment. We have heard of the difficulties of Scotland and of the United States; but there are many aspects of the judicial system of the United States which perhaps it would not be desirable to introduce here. I know there is always the possibility that the man may give up his job and that therefore the employer will not be able to enforce the attachment order that has been made against him. I know that there are many nomadic workers. I do not want to get myself into conflict with the Race Relations Act, but I will mention the Irish workers who come over here on construction and pipelaying work. It is the easiest thing in the world for them, if they have an attachment order made against them, merely to give up their job, go back to Ireland to their families for a few weeks, and then come back again. One has heard of many such cases. Nevertheless, I think that we must have this weapon of attachment in our hands if we are to abolish the out-dated weapon of imprisonment.
I entirely agree with my noble friend Lord Donaldson about the irresponsible way that hire-purchase firms sue a man one day for a debt which he has incurred on a purchase and then go round the next day to try to persuade him to buy something else. But I am not with my noble friend when he suggests that we should deprive that kind of firm of the protection of the courts. The courts of this country ought to be open to everybody; we cannot have a kind of legal apartheid operating, whereby some people can go to court to get redress and others cannot. I feel that we must teach people that they have to pay their debts; we must make it possible for society to enforce the payment of debts. It is right to end prison sentences, as I have already said, but we must have a substitute. The courts in their discretion will decide the cases in which to enforce the claim by attachment of wages and those in which it is not the best remedy. That is all I have to say, except that I very much welcome this modernising and imaginative measure.
§ 5.45 p.m.
VISCOUNT COLVILLE or CULROSS
My Lords, there is nothing like one of the noble and learned Lord's Administration of Justice Bills to provide Parliamen- 246 tarians with some light bedside reading. I do not know what the combined weight of the Reports which need to be studied for this Bill must be, but I think it is considerable. There are the Report of the Commercial Court Users' Conference, the Payne Report, the Beeching Report and the Winn Report. There may be another Report, for all I know, but those are the only ones that I think are relevant. They are formidable in their scope. What I think they bring to our attention is the colossal value which one can derive from the work of these Committees. It would not be possible to have any intelligible conversation or discussion of the contents of this Bill—indeed, the Bill would never have arrived—had it not been for the prodigious work of these Committees, with their full and well-written Reports which have led to the recommendations, some of which are now being implemented. I would join in the compliments paid to the Payne Committee whose Report is the basis of Part II of this Bill.
I would apologise to your Lordships, and to the noble and learned Lord the Lord Chancellor and my noble friend Lord Ilford for having missed their speeches; but I have a note of what they have said, and I shall, of course, be able to read their speeches tomorrow. I would join in the welcome that has been given to the reorganisation of the High Court so that the Family Division may now be formed. That is a matter which has been under discussion for some time. I think I am right in saying that my right honourable friend the Member for Epsom, Sir Peter Rawlinson, pressed for it a long time ago; and he was not the only one. Although I take the right reverend Prelate's point that it is only the High Court that is affected, I think he agreed that it is a good start, even if it has to be a start at the top. I have no doubt that the difficulty about taking his idea further is that the jurisdiction, for instance, of quarter sessions is bound to be affected by whatever happens to the Beeching Report, and this would hardly be the moment to go into the reorganisation at that level of the court's jurisdiction when we may find that quarter sessions will cease to exist at all.
While welcoming this Bill, I should like to ask a few questions about Clauses 3 and 4. It may well be, and I think 247 it is so, that the Report of the Commercial Court Users' Conference suggested what the experiment (for such I believe Clause 3 to be) in relation to the commercial court should be. There are paragraphs in this Report which explain the sort of evidence in the taking of which the strict rules may be dispensed with, and paragraphs which explain the provisions of sitting in private. But not everybody reads these Reports, and I believe it would be helpful if the noble and learned Lord the Lord Chancellor, if not to-day then at some other stage, could explain a little more what he has in mind: what sort of evidence would be admitted; whether the hearsay rule would be widely breached and, if so, in what way, and the type of case—perhaps those mentioned by the noble and learned Lord, Lord Morris of Borth-y-Gest—for the hearing of which the court will be sitting in private. With this information, I think the House will be able to judge much more easily than now whether this idea is a good one or not.
The House cannot fail to have been impressed by the speeches of both the Lord Chancellor and the Lord Chief Justice on Clause 4. My hesitation about accepting it in full is again, to some extent, the result of not knowing what is involved. I have no idea which are the towns where assizes are no longer likely to be held if the Orders in Council are made. I do not know what the consequential provisions may be about sending cases which have been committed from the magistrates' court, for instance to assize, or sent up in some other way, and how those arrangements will be dealt with. Therefore it would be a great assistance to the House if at some stage a little more could be spelt out, although I understand the reason for this.
I hope the noble and learned Lord the Lord Chancellor will be able to give us an assurance that this is not, as it were, a pre-judgment on Beeching. It may be that some patchwork has to be done, but the Beeching Report was made available to the public, and to Parliament, only in September, and we have not yet debated it. The noble and learned Lord the Lord Chief Justice may well be right in saying that it is the correct decision, but there are a number of questions 248 to be asked on it; and not least is the matter of the cost, and where the cost is going to fall. And there will be substantial problems about buildings, and matters of that sort.
These may all seem very trumpery, but, on the other hand, if millions of pounds are involved one wants to know where the money is to come from and who is going to provide it. That is only subsidiary to the major matter of principle of a complete reorganisation of the circuit system, which has been going on now, in one form or another, for something like 700 or 800 years. This will need discussion in Parliament, something that we have not yet had. I hope that the noble and learned Lord will be able to give us an assurance that this in no way commits the Government to piecemeal implementation of Beeching without a proper discussion of the whole Report and a collection of the views from both Houses of Parliament upon it.
I wonder whether he could also reassure me on one other matter on this topic. I see in Clause 36 of this Bill that there is to be a relaxation on the districts to which the number of county court judges may be assigned. It occurs to me that this may be a device whereby the county court judges may be used more regularly as commissioners in order to help out with assize work. If this is so, it could be an implementation of part of Beeching rather in advance of the general matter. I should like to know a little more about Clause 36.
Part II of the Bill deals with the urgent matters that the Payne Committee Report mentions in paragraph 35. The noble and learned Lord the Lord Chancellor will, I am sure, be replying upon the major issue of the enforcement office, since this has been raised by two or three noble Lords, and there is plainly disagreement in the House about its omission from the Bill. I myself should like to know more about this subject, because while I accept as an extremely valuable reform the abolition of imprisonment for debt, and the imposition of attachment of earnings as a substitute for it, I am exceedingly worried as to how this new scheme is really going to work.
It was, I think, the noble Lord, Lord Lloyd of Hampstead, and the noble Lord, Lord Donaldson of Kingsbridge, who said 249 that the kernel of this whole system was to be the enforcement office. It was the enforcement offices that were to discover the position in which the debtor finds himself; what his protected earning rate is to be and what are his other indebtednesses. They would co-ordinate the various debts and see that they were all run together. There is a tremendous amount of administrative work, and a great deal of judgment needs to be applied in this matter. Instead of the enforcement offices, it is all to be done by the clerks to the justices and, as I understand it, the county court registrars.
My Lords, I should be the first to suggest that they are very experienced and extremely skilful people. But they are also incredibly busy. Magistrates' clerks are often part-time appointments, with solicitors' practices of their own to carry on. The registrars are already dealing with a prodigous amount of business in the course of their duties. Nor does Parliament hesitate, Session by Session to give the county courts more work to do. Indeed, we are giving them more work to do in this Bill, quite apart from Part II. So, they are to take the brunt of this new burden. I should like to know from the noble and learned Lord whether the various associations of magistrates' clerks, county court registrars, and the other bodies concerned, have told him that they are content to take on this work without the addition of the enforcement office, which was the basis of the Payne Committee's approach to this matter.
Apart from the obvious difficulties which have turned up in the case of the Maintenance Orders Act 1958, which are to some extent put right in this Bill—such difficulties as finding the new employer, and matters of that sort—we shall now get what I imagine to be a comparatively novel situation. There cannot be many people in this country—at least, I hope there are not—who have more than one affiliation order imposed on them. I doubt whether there are more than a very few people indeed who are paying maintenance to more than one ex-wife. There may be some, but it cannot be a very common situation. Possibly there are some who are doing both, but the number of multiple debtors in relation to whom there is an attachment of earnings order now must be 250 extremely small. That is not going to be the case, as I understand it, under this new system. The whole object is to try to deal with the people who simply have not been able to organise their affairs as well as with the hard core of wilful defaulters; and these are the people who are likely to have multiple debts.
This has all to be dealt with by two sets of people—the officers of the court and the employers. What I have said about the officers of the court also applies to the employers. The Payne Committee Report, in paragraph 593(b)(ii) said:Whilst, therefore, we appreciate the burden which this process"—the attachment of earnings—will in fact impose on employers, we think the majority of them accept the arguments in favour of attachment.Perhaps they do. But they have never been asked in the form that the Bill now sets it out. The Confederation of British Industry did not even give evidence to the Payne Committee at all; nor, I think, did the chambers of commerce. Yet they are suddenly confronted with the provisions of this Bill. These provisions are formidable, and I should like to draw your Lordships' attention to them.
In the first place, non-compliance with these attachment orders will be a criminal matter. In Clause 18 there are criminal sanctions for failing to comply. It is true that there are defences. You start off with the fairly severe penalties, which can be imposed, presumably, on more than one occasion if they get it wrong on more than one occasion. Not all employers have full-time wages clerks and computers who can work out the complicated provisions of these orders. Although they are much the same as, or perhaps even simpler than, those under the 1958 Act, they are nevertheless complicated. Not every employer has somebody whole-time on this job, and in a small firm the burden may be very considerable. Certainly it is not going to be very easy.
The Payne Committee report that the form of guidance which is given with the maintenance orders attachment procedure at the moment is a very complicated one, and people do not understand it. I wonder how many of your Lordships could say offhand—even those who are 251 legally qualified—what would be an attachment of earnings order which is made to secure the payment of judgment debts or payments under administration orders, or one that is not. According to that distinction, in Part II of Schedule 4 (this is where there is more than one attachment of earnings order) priorities will have to be made out.
Supposing that there are a number of orders, they may be for all sorts of things. They may be for taxes, debts, maintenance orders, affiliation orders, and, I have no doubt, for other things as well. Then they come in at different times, and in different categories. The employer is supposed to sort out, in connection with the protected earnings rate, and the amount that has been set aside for deduction each week, who is to pay, and in what order of priority? If he gets it wrong he is subject to a criminal prosecution. I should have thought that a Is. a go, which is what is allowed to him under Clause 10, is pretty small compensation for this. I do not think there was any suggestion by Payne that this should be the case and that this should be a burden on employers, because what they say in paragraph 609 is this:It would be intolerable for any employer to have to comply with more than one attachment order for a single employee and we have therefore considered how this could be overcome.They then say that the enforcement office should consolidate them and send the employer a consolidated order.
What is to be done about this? Are the county court registrars going to spend all their time consolidating judgment debts and attachment of earnings orders? Are the clerks to the magistrates going to do it? And if not, are we really going to insist upon criminal sanctions upon the employers if they get it wrong? This is the sort of practical side of it where the absence of the enforcement office, I believe, is critical. I should very much like the noble and learned Lord the Lord Chancellor to explain a little more, first, what people who are affected by the Bill think about it, and, secondly, how he believes it is really going to work.
There is, of course, another point about this whole process. It may very well be that people in my position who are self-employed are not very common. But I 252 do not think we arc becoming any less common as a result of such things as selective employment tax. The attachment of earnings procedure simply does not work with self-employed people, because nobody pays them any wages—at least I do not think so—under the definition of "earnings" in the Bill. So we are going to have a collection of people in this country no longer subject to imprisonment for debt and not capable of being dealt with, as I understand it at any rate, by attachment of earnings. What is to be done about them? The Payne Committee Report also went into garnishee proceedings and made recommendations about them, but none of that appears in the Bill. Therefore, the system does not seem to me to be altogether complete.
There is one small point about which I should like to know. It may well be that in some cases creditors ought not to have given the debtor credit. But I do not believe that this is altogether universally the case, and I am surprised to find that the poundage—I think it will be a poundage or some sort of fee—payable for the collection through the courts by means of an attachment of earnings order is not, as I understand it, to be payable by the debtor. That is something that the creditor will have to bear. So he is the one who, although he is due the money, will only get it back, I believe, subject to a deduction because this process is being carried out through the county courts and the magistrates' courts.
Those may be criticisms. I do not mean them to imply that I wish to attack the principle of Part II. I would not go so far as the noble Lord, Lord Donaldson, in saying that this is something which can be left out and imprisonment for debt simply abolished, and the whole thing left at that. I should have thought that it was worth trying this, but 1 must say that I would need a lot of assurances, and I should like to discuss this matter at a subsequent stage in some detail to see how in fact it is going to work.
There is a footnote, as it were, to this, because in Clause 38 of the Bill—although it is none of this House's business—there is a provision for the payment out of public monies for the extra expenses of this Bill. Where are the extra expenses of this Bill going to be? I would suggest that they are going to be 253 in Part II; and if they are in Part II, what are they for? Perhaps this is the key to the practical side of the whole issue. Perhaps the noble and learned Lord (I do not think he explained this in his opening speech) has more men, more trained staff, whom he can appoint in order to deal with this practical side—and perhaps Clause 38 is to pay for them. If so, I should be very grateful if he could explain it to us.
Part III derives from some of the Winn Report and it is not a part of the Bill on which I wish to say anything at all, except that I welcome it; it seems to be sensible. I think it follows on, to some extent, the provisions of last year's Administration of Justice Bill, and it fills out powers in personal injury cases which seem to me to be admirable.
Under Part IV, where we go back to Payne on the actions by mortgagees for possession, there are three questions to which I should be grateful to have an answer. First of all, Clause 28(1) does not apply this new procedure to actions for foreclosure in which a claim for possession of the mortgaged property is also made. This is contrary to the recommendation in paragraph 1360 of the Payne Report, and I should be grateful for an explanation as to why their recommendation has been departed from. Secondly, there is no mention in this Part of this Bill of any limitation of these powers to houses which come within Rent Act control, which was again part of the Payne recommendations; and I should like to have that explained. Thirdly, I should like to know whether in fact these matters are, as I believe to be the case, to go to the registrar in the county court, as recommended by Payne in paragraph 1405.
I believe that, on the whole, Part IV contains acceptable provisions, since it goes back really to the position which I believe was operating between about 1936 and 1965, when the new Supreme Court Rules made it clear that the powers, particularly of the Chancery Masters, which they had enjoyed, so they thought, legally for some time, were not in fact really theirs. It is therefore to put the discretion back upon them, and indeed chiefly on the registrars of county courts, that this Part of the Bill is being enacted. I believe that it will go towards providing justice and a reasonable approach in taking the possession of houses from 254 people who have defaulted under mortgages.
I therefore have a qualified welcome for the Bill. I believe that we shall need to have considerable discussions about it at some subsequent stage, and it may well be that when we come back after the Recess there will have been opportunity for discussions and consultations, so that we can think more fully about it. But for the moment I would certainly not wish in any way to hold up the Second Reading, and I look forward to a series of fascinating debates upon it later on in this Session.
§ 6.8 p.m.
§ THE LORD CHANCELLOR
My Lords, I am very grateful to all noble Lords who have taken such an interest in this Bill. To the noble Lord, Lord Ilford, may I say first that the Royal Commission's Report is not intended to suggest an end of the assize system? The Report points out, in paragraph 69 and succeeding paragraphs, that it is a very good thing to have the Judges of the High Court going round the country. The main defect, as the Commission point out, is that they have to go to far too many places; but they would retain the system as a system. If I may say so to the noble Lord, I have been struck by the number of judges who have told me, "I started reading the Report one evening, out of a sense of duty; then I simply couldn't put it down, and I didn't get to bed until three o'clock". Once one has gone through the description, which most lawyers know anyhow, of the present set-up, I think the Report makes compulsive reading; and a great deal, as I happen to know, was written by the Chairman himself.
As to the Admiralty Court, I entirely agree with what the noble Lord said. It is of course essential that the Admiralty Judge or Judges should be available in London, so that early dates and fixed dates can be obtained; and the whole of the Admiralty Registry will be moving to the Queen's Bench Division with the Admiralty Court. I heard what the noble Lord said about Crown debts. That perhaps is something which we can deal with at another stage of the Bill. The noble Lord also asked a question about local authorities and mortgage possession actions. This again, no doubt, is something which is a matter of opinion. But, 255 of course, a local authority is under a duty to provide housing; it is not under any duty to provide loans.
I was glad to hear the things said by the noble Lord, Lord Lloyd of Hampstead, about the Payne Committee, because that Committee has produced a massive Report and obviously has done an enormous amount of work upon it. But he, like my noble friend Lord Donaldson of Kingsbridge, was a little unhappy about starting without an enforcement office. May I reply to both noble Lords at the same time? There are 330 recommendations in the Report. This Bill contains 40 clauses, and it is as much as I shall get in this field in this Session. If one had concentrated entirely on implementing Payne, there would have been nothing else in the Bill at all. One has to see what are the really important things. With the greatest respect, it would be quite impossible to do as my noble friend Lord Donaldson suggests—to abolish imprisonment for debt but not have attachment of earnings orders. On this point I must agree with my noble friend Lord Leatherland. Nobody before the Committee that I know of—except perhaps one body—ever suggested that at all.
The Committee did not say that all the people against whom attachment orders were made were poor, unfortunate, muddled, feckless people; it said that those were the people who went to prison, and one has to face the fact that, particularly in some parts of the country, there are sure to be a number of judgment summonses in different courts. There are parts of the country where, broadly speaking, nobody ever seems to pay a hire purchase instalment unless and until a committal order is made. They have a judgment summons, but they do not attend to that. Very often there are several judgment summonses in relation to one debt, and then finally the committal order is made, which is suspended so long as so much is paid, and only when the bailiff comes to take them to prison do they produce the money. But in fact they had it all the time. It was not that they could not pay, but just that they did not believe in paying. So far as the terms of contract are concerned, their view is that by entering into a hire purchase contract you do not 256 expect to pay the money on the dates stated; the only date on which you pay is the date on which the bailiff is coming to take you to prison. It would therefore be quite unthinkable, and nobody has suggested it, to abolish imprisonment for debt without having attachment of earnings orders.
I should very much like to have enforcement offices, but one has to be practical. Unfortunately the Payne Committee were a good deal divided on various points, and there was no general recommendation about the order in which things should be carried out. They had varied views about the enforcement office. Some thought it ought to be entirely distinct from the county court; some thought it was virtually the same thing. At page 401 some of them said:To bring all these changes into operation at once would, we believe, result in administrative chaos. They should, in our view, be introduced by stages over a period of years and as each change is made its effect should be studied closely to see how it operates. If serious practical difficulties arise at any stage these should be corrected before the next stage, is undertaken. Holding this view we think it is important to spell out, in more detail than our colleagues have done, the stages by which the Committee's recommendations, if approved, could best be implemented.They do this, starting on the next page:Stage 1. (A) abolish imprisonment for civil debt. (B) authorise the county court to make attachment of earnings orders for civil debt. (C) authorise judgment creditors in other courts to enforce through the county court and (D) extend and enlarge the administration order procedure. Some of our other less important recommendations, such as the use of a questionnaire in larger cases, could be implemented at the same time by conferring the appropriate power on the county court. The improvements to the system of registration of judgments which the Committee recommends should also be implemented as soon as possible.Stage 2. Transfer the bulk of enforcement from the High Court to the county court.Stage 3. Gradually, over a period of months or years, transfer the magistrates' civil jurisdiction, including rates, to the county court. During stages 2 and 3 the Committee's other less important recommendations could be introduced at convenient times.Stage 4. Once the county court was operating as the main, or sole, enforcement agency for the bulk of civil debt, the enforcement side of each county court could be separated off as an enforcement office and the 'fair shares' principle could be introduced together with such of the Committee's other less important recommendations which have not already been introduced.257 Then they come to Stage 5. So they are envisaging the enforcement office as arriving at only quite a late stage in the proceedings, and they do not really agree among themselves as to what its exact nature should be. In a sense it exists already, because the registrar, the chief clerk and their staff are experienced in going into financial affairs with debtors to see what sort of instalment order ought to be made. Whether the enforcement office is to be a new office, in which case it means that everywhere throughout the the country new premises will have to be found, or whether in effect it will end up as part of the county court, we shall have to see.
My noble friend Lord Lloyd of Hampstead questioned the estimate of 100,000 cases compared with the number of judgment summonses. The answer is that there will be only one attachment of earnings order for one debt, whereas there can be several judgment summonses in respect of the same debt. Also, there has to be default in payment before an attachment of earnings order can be made. I have a lot of sympathy with the view that one of the recommendations it would be nice to implement would be that about harassment, but we have found both definition and enforcement extremely difficult. How-ever, if my noble friend likes to put down an Amendment on Committee stage I shall be happy to consider it.
The right reverend Prelate, the Bishop of Leicester, welcomed the family courts but though we ought to have started at the bottom layer instead of the top. In my view, there is a lot to be said for that; but to think out entirely anew what would be the best form of local family court, exactly what they should cover, to whom appeals should go, and so on, is a much more complex operation than altering the Divisions of the High Court. But I hope that the fact that we are now getting a Family Division of the High Court will stimulate thought into giving us a really local family court so that family matters no longer have to be taken in what used to be called the "police court".
I gather that the right reverend Prelate welcomed the abolition of imprisonment for debt. In regard to Clauses 5, 6 and 7 I think that perhaps he had not ob- 258 served that no order for committal in those cases—that is, maintenance cases—can be made without the court considering whether an order of attachment would not be the appropriate course to take. It may be that some day we shall be able to abolish imprisonment for debt in maintenance cases. We shall be in a much better position to judge whether or not we can do that when this legislation has been in force for some time.
Again, it would have been nice to have had a welfare officer in every court, but that is really impracticable at the present time. There is a great shortage of welfare officers, and considerable finance would be involved. Also, as I said when moving the Second Reading, the judges and registrars and staff are well used to dealing with people and are very good at distinguishing those who are crooks from those who are muddlers, and at helping the latter. My noble friend Lord Donaldson asked whether we could not manage simply with execution against goods; but that, I am afraid, is impossible, because experience shows that 40 per cent. of all execution for distress provides absolutely nothing at all.
Then the noble Lord, Lord Morris of Borth-y-Gest, with his great knowledge and experience, said what he did, and I entirely agree with everything he said about the Commercial Court. I can assure him that there is nothing either in the Report or in the Bill which prevents the trial of cases anywhere. I am very grateful to the noble and learned Lord, the Lord Chief Justice, for explaining, so much more clearly and with so much more authority than I could, our present difficulties, and how essential it is that we should have Clause 4 of this Bill quite apart from the Beeching Report.
The noble Viscount, Lord Colville of Culross, first of all asked about the Commercial Court and the type of case in which provision would be made for sitting in private and with regard to evidence It would be for the Rule Committee to decide if and how far any limitation should be placed. They might think it right to say that it should apply only if both parties agreed and the Court also concurred. I should like to leave it to the commercial judges, in a sense, as an experiment. The noble Viscount asked whether they would allow hearsay 259 evidence and how far they would disregard the strict rules of evidence. I would leave that to them. In my old age, I have with some reluctance come to the conclusion that we would be better without any law of evidence at all. I do not believe it is necessary. Most systems of law do not have it, and the complications are now so great. I am not too happy at having introduced, and succeeded in getting your Lordships to pass, the Civil Evidence Bill. It is very logical; you must allow for computerised evidence because in some cases it is the only form of evidence nowadays; but it was so complicated that whether it will work I do not know.
I am a great believer in trying things out in a small way and seeing what happens. I should like to see the commercial judge, if he thought fit, sitting round the table with the litigants, without a wig and gown, and paying no attention to the law of evidence if he liked. Most of our law of evidence came about because everything was tried by a jury. When I was first called to the Bar, in any accident case there was always the county court jury. It is only the other day, almost, that any English judge was ever allowed to decide a question of fact at all. Our complicated law of evidence was designed to prevent juries from being misled by subtle advocates. The educated person knows that hearsay evidence is not very reliable, but (it was said) those chaps in the jury box do not understand that. I believe that is all nonsense, and I should like to get rid of the whole thing.
The noble Viscount spoke of Clause 4 as a pre-judgment of Beeching. I am not quite sure what he meant by that. All I can say is that the Beeching Report, unlike most of its predecessors in this field, is a unanimous Report on every recommendation, with one small exception only. The Government have announced that they have accepted the Beeching Report and will implement it as soon as possible. I am in a position myself to say that it has been approved by the Council of Judges, in principle, without, I think, any dissentient voice. It has been welcomed by a joint Press conference of the Bar Council and the Law Society, who have also accepted it in principle. What the noble Viscount 260 means by saying that he hopes this is not a pre-judgment I do not know.
I am not in the least against discussion. I should like discussion of the Beeching Report in both Houses. The Opposition in the other place have I think more supply days than the Government for general discussion, and I rather think that in this House, too, there are more Wednesdays at the disposal of the Opposition than the Government. Certainly I should welcome debates.
The noble Viscount also asked how the new scheme is going to work, and whether there may be more registrars and clerks. What is said about finance in the Explanatory Memorandum is this:Only the provisions of Part II of the Bill are expected to have any significant manpower or financial implications. The new system of enforcement would involve increases in expenditure on some services, but would also allow considerable savings on others. It is not possible to say how many additional attachment of earnings orders might be made in a year, but if it were around 100,000 it is estimated that only a small increase in manpower would be required, and that the net increase in cost to the Exchequer would be around £70,000 a year.Until it gets started, I do not suppose we shall know how many orders there are likely to be. I think some noble Lords have rather underestimated the effect of the provision for administration orders and the encouragement of administration orders. This necessarily means that a man's whole position will be looked at, what his earnings are and what his outgoings are, and it will of course deal with all his creditors at the same time. That, I think, is very likely to be advantageous in itself.
There are one or two other points of detail which I have not covered, notably mortgage possession, on which, if I may, I will write to the noble Viscount. I must say that I really cannot accept what he says about employers. Everybody knows that if you are going to abolish imprisonment for debt and have attachment of earnings orders instead, of course that is going to put some administrative burden on employers. You cannot have it without that. But this Committee first of all, four years ago, sent out circulars giving their membership and their terms of reference and referring in particular to attachment of earnings. These circulars were sent to 261 the National Chamber of Trade, the Federation (now the Confederation) of British Industry, the Institute of Directors, the Institute of Chartered Accountants and the National Union of Small Shopkeepers, as well as a lot of other people.
The National Chamber of Trade said that there was general acceptance of the right of a creditor to the attachment of his debtor's wages, especially if the employer were allowed to make a nominal deduction for his trouble. The Institute of Chartered Accountants suggested the introduction of attachment of earnings despite the fact that it might be inconvenient to employers. The National Union of Small Shopkeepers drew attention to the Scottish system and thought that a similar system might be introduced in England. Neither the Institute of Directors, nor the Confederation of British Industry made any reply at all, and these are the people who are now saying that they never had an opportunity of expressing their view.
VISCOUNT COLVILLE OF CULROSS
My Lords, with respect, that is not what I said. I did not suggest that anybody was complaining that their views had not been taken into consideration by the Payne Committee. What I was suggesting was that the Bill is now different from the recommendation of the Payne Committee in that, although the noble and learned Lord the Lord Chancellor read out a minority report of two on page 401, there was in the much earlier stage a great pushing forward in priority of the enforcement office. It is in that respect, I think, that the burden has shifted. It is not the same as the Payne Committee Report. The burden has been put on to the employers and in terms which the Payne Committee themselves recommended should not be done, about dual orders and things of that sort.
§ THE LORD CHANCELLOR
My Lords, I do not think this will make the slightest difference to employers. The burden on employers is seeing to the order and seeing that they deduct the right amount. This does not depend on the enforcement office at all; it is of the nature of attachment of earnings orders that that is what has to happen. 262 The greatest care has been taken by the Committee and by me to see that the burden on employers is as small as it possibly can be. The Trades Union Congress, of course, formerly objected very much to the whole idea; but since 1958 employers have been used to operating it in the case of maintenance orders. It was said at that time that it was opposed by the T.U.C. on the ground that this would make relations between employers and employees worse. The T.U.C. have evidently found that that is not so. It would be surprising to hear that the employers have found that it is so. Surely it is better for employers to keep men at work rather than have them in prison. It is not all loss to them. In any case, of course, if the estimate of 100,000 attachment of earnings orders is anything like right, I would point out how many tens of millions of employees there are; and there are of course, enormous numbers of employers. So the number of orders with which any one firm is concerned is likely to be extremely limited. But we really have done everything we can to make the task of the employer who has to comply with one of these orders as simple as possible. Of course it is not right to suggest that if an employer makes a mistake he is going to be convicted of a criminal offence: there are plenty of defences, and nobody is going to be sent to prison merely because he makes a mistake.
Then the noble Viscount mentioned the difficulty which an employer might find if he were asked to operate two attachment orders with differing priority. A copy of any attachment of earnings order made by a magistrates' court would be sent to the debtor's local county court, and it is unlikely that the latter court would make another attachment order in respect of an ordinary debt, as it could operate only on any free earnings left after the magistrates' order had been satisfied.
My Lords, if there are any other points on which I have not replied to noble Lords, may I write to them; and may I again thank them for the interest which they have shown in this Bill?
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.