HL Deb 15 February 1979 vol 398 cc1401-8

3.31 p.m.

The LORD CHANCELLOR (Lord Elwyn-Jones) rose to move, That the draft order laid before the House on 17th January be approved. The noble and learned Lord said: My Lords, I beg to move that the two orders in relation to Northern Ireland be approved. They relate to the recovery of debts in Northern Ireland. The second of the orders only corrects a minor drafting omission; I shall deal with it later. The main order, the Judgments Enforcement and Debts Recovery (Northern Ireland) Order seeks to amend the Judgments (Enforcement) Act (Northern Ireland) 1969, which provides machinery for the enforcement of judgments and orders of courts in Northern Ireland which has no parallel in the rest of the United Kingdom.

In England and Wales if a person obtains a judgment from a court, be it for payment of money, return of goods or possession of land, then, if the judgment or order is not complied with and has to be enforced, he goes back to the court from which he obtained the order, or sometimes for geographical reasons, a different court, for enforcement. In Northern Ireland, the arrangements are different. Once you have your judgment or order from the court, any enforcement proceedings must be taken in the central Enforcement of Judgments Office, which is situated in Belfast.

The Act of 1969 represented an entirely new venture in this field and is without precedent anywhere in the United Kingdom, and it is now thought that a degree of revision is required in the light of experience. The order before your Lordships today represents the fruits of eight years' experience of the working of the Office, and since I shall shortly be acquiring responsibility for the Office it also includes experience from England and Wales which I hope will further improve matters.

The order is based on proposals published more than a year ago. Since then, there have been intensive discussions with those who may be affected by the order, including the legal profession in Northern Ireland, the Standing Advisory Committee on Human Rights, public authorities and the affected commercial interests. I am happy to assure your Lordships that the draft order has met with general approval.

It has become clear that, despite the need for improvement, the Office has succeeded in dealing with outstanding matters. A creditor's main interest in any system of enforcement is that it. should produce a payment for him. In the situation which has prevailed in the last few years in Northern Ireland, it has been very difficult for the Office to perform the tasks assigned to it. Despite the difficulties, it has managed to perform the duty of enforcing judgments of the Northern Irish courts in a way which I think is a credit to the staff involved. Last year, the Office dealt with nearly 5,700 applications. Its success rate, judged by the amount of money recovered, is remarkably high. It has managed to win general confidence in Northern Ireland, and it would be wrong for me in introducing this order not to pay a tribute to Master Anderson—who not only chaired the working party on whose recommendations the Office was set up but who is also, and has been since its inception, the Master of the Enforcement of Judgments Office—and his Chief Enforcement Officer and staff on the way in which they have carried out their duties in conditions which have been far from easy.

If I may turn briefly to the provisions of the order itself, it is a highly technical order the provisions of which are intended to make the Office more efficient and speed up the making of orders and the obtaining of enforcement. It will simply provide the structure by which those improvements will be achieved. I shall, as soon as the order is made, be making Judgment Enforcement Rules which will clothe this structure. My intention is to reduce the complexities of the enforcement process to a minimum, to enable orders to be made quickly and with as little work as possible for all concerned, and, most importantly, to see to it that justice is done, first, to the creditor, in that he gets the money or order he is entitled to as quickly as possible, and, secondly, to the debtor, in seeing that he is fairly treated. I do not think it is necessary for me to go through this complex order in detail, but I shall point out its main provisions to your Lordships.

The first is a provision which attempts to solve the problem of having to go to a court and then to the Office to enforce the payment of a debt. The provisions of Article 19 and Schedule 3 will allow the Office to take enforcement proceedings for the recovery of certain debts without a prior judgment being obtained in a court. A creditor whose debt is for less than £300 and who feels that there is no defence to his claim would be able to go direct to the Office without going to court first and to seek enforcement straight away. If the debtor disputes the debt, then the application will be refused, the creditor will have lost his application fee, and the matter will have to go back to court while liability is determined. So there will be no risk of this procedure being abused.

Nevertheless, this proposal has given rise to some concern on the part of the Law Society in Northern Ireland. Their concern has been that the Office will not be able to cope with the additional burden placed upon it by this provision. The fear that it may not be able to cope, given the radical changes which are provided for by the rest of the order, some of which I shall deal with in a moment, is a reasonable one. I am glad to be able to give the assurance that I shall not seek to bring this particular provision into operation until there have been further consultations with the users of the Office, including the Law Society, and am satisfied that the arrangements within the Office are such that they can deal with the additional work that might arise.

The other major innovation is the introduction of a system of administration orders. This is very much on the lines provided for in England and Wales by the County Courts Act 1959. The best way of describing administration orders is as a poor man's bankruptcy, although the order does not have quite such a drastic effect as bankruptcy. The proposal meets the difficulty of the large number of debtors who get themselves into a situation where they owe money to a number of creditors, each amount in itself being very small, but where they would be faced with successive enforcement actions against them by those creditors to enforce payment of the sums due. An administration order allows the debtor to apply to the Office for all his debts to be brought to account and for him to pay one sum weekly or monthly to the Office, which will then distribute that payment among the creditors. The advantage for the debtor is that he is protected against his creditors, and the creditors do not have to wait in turn for payment.

Other provisions in the order modify the system of attachment of earnings to bring the system in Northern Ireland into line with that in the rest of the United Kingdom, make changes in the way in which a number of enforcement orders will be dealt with in the future, increase the penalties for persons who make misrepresentations in trying to recover a debt, and allow the Northern Ireland Housing Executive in common with other public bodies in Northern Ireland, to take magistrates' court proceedings without employing a solicitor.

I do not, unless your Lordships wish me to do so in relation to any particular article, intend to deal in detail with any other article. The main purpose of the order is clear. It will make the Office more efficient and, as I have said, it has the general blessing of the Northern Ireland Law Society and other users.

The second order remedies an oversight in the drafting of the Armed Forces Act 1971. The effect of the order is to amend provisions of the Services Acts which allow deductions from pay of members of the Armed Forces, so as to bring within their scope judgment debts which, in Northern Ireland, are enforceable by the EJO. That will make the position the same as it is in the rest of the United Kingdom.

Before I sit down, perhaps I could take this opportunity to repeat what I have indicated in a Written Answer to a Question from the noble Viscount, Lord Brookeborough, this afternoon—namely, that I propose shortly to make a commencement order bringing all the principal remaining provisions of the Judicature (Northern Ireland) Act 1978 into force on 18th April this year. That, therefore, is the date on which all the main changes provided for by that Act will take place, including the transfer of responsibility for the administration of the courts in Northern Ireland from the Secretary of State to the Lord Chancellor. It is also the date which I shall appoint for the commencement of the principal order which is before your Lordships this afternoon. I beg to move.

Moved, That the draft order laid before the House on 17th January be approved.—(The Lord Chancellor.)

Lord BELSTEAD

My Lords, this order includes 35 articles and five Schedules and, in view of its complexity, I am more than usually grateful to the noble and learned Lord the Lord Chancellor, for his explanation of the main provisions of the order. If I may, I shall confine myself to only two aspects of the order and I shall do so briefly.

The noble and learned Lord has explained that Article 19, taken with Schedule 3, makes new provisions for the recovery of a debt without judgment. I was a little concerned to read paragraph (6) of Schedule 3 which, as I understand it, takes a debtor to have admitted a debt if the debtor does not pay in full by the time he is summoned to attend for examination, or does not comply with the summons or notify the Office in writing that he disputes the debt. As I understand it, we are talking here in Schedule 3 about a situation in which a creditor makes application to the Enforcement of Judgments Office and on payment of a fee alleges that a debt is owed. I should have thought that some further protection for the alleged debtor might perhaps be required in the procedure.

I am aware that in summary proceedings, certainly in England, the imposition of a sentence of imprisonment in default of payment of a fine can sometimes work wonders. In other words, the imposition of an immediate sanction can often wonderfully concentrate the mind of someone who owes money. None the less, I should have thought—and I am asking the noble and learned Lord for his views on this—that perhaps the somewhat peremptory provisions of paragraph (6) of Schedule 3 might be looked at again to see whether a person who, after all, is only alleged to be owing money should be further protected so far as the procedure of Schedule 3 is concerned before the Enforcement of Judgments Office assumes that the debt has been admitted.

I should like to ask one other quick question of the noble and learned Lord regarding Article 34 which he mentioned. He said that the effect of Article 34 was to enable officials of the Housing Executive to appear in magistrates'courts for recovery of rent arrears instead of having to employ a solicitor. I assume that the Northern Ireland Law Society has expressed itself satisfied with that. But is it the case that the provisions of Article 34 will also facilitate the bringing of proceedings in order to try to reduce the enormous rent debt which, so far as I know, I regret to say, still exists in Northern Ireland and which is owing to the Housing Executive? If that is to be the case, then, on those grounds, I most certainly welcome Article 34.

May I also say that I am grateful to the noble and learned Lord for announcing to the House the terms of his Written Answer to my noble friend Lord Brooke-borough. It is of interest that the provisions of the Judicature Act are to be brought into force in April. I have no further questions and I most certainly support the passage of this order.

Viscount BROOKEBOROUGH

My Lords, I should like to thank the noble and learned Lord for the courtesy he has shown in announcing the Answer to my Question. It certainly will relieve a great deal of uncertainty in Northern Ireland. There has been a good deal of discussion as to the final date and it will certainly be welcomed. Once again, I thank the noble and learned Lord for his courtesy.

The LORD CHANCELLOR

My Lords, I am most grateful to both noble Lords for their support for these orders. I should like to deal with the matters which have been raised. The procedure that is contemplated in Schedule 3 is similar to default procedures in England and Wales. However, I can assure the noble Lord, Lord Belstead, that when the rules are drawn up I shall bear in mind the importance of adequate safeguards for the debtor. I am grateful to him for drawing specific attention to the matter.

As regards Article 34, I am aware that representatives of the legal profession in Northern Ireland are not happy about this provision, but I can only say that we have looked into it and have concluded that it is really sensible for public authorities who have been diligent enough to establish teams of officials for the purpose of recovering arrears to be allowed to nominate those officials to appear on their behalf in court to prove the debt.

As for the amount of debt, the Housing Executive is the only Northern Ireland public authority which is not allowed to proceed in the summary courts for the recovery of debts over £100. There is, I think, no good reason for that and we have concluded that there is a clear case for bringing the Housing Executive into line with the other public bodies. There is an undoubted problem of recovery of outstanding rent payments in Northern Ireland and the process of seeking recovery is being dealt with. I venture to think that what is proposed here will to some extent assist in that operation.

On Question, Motion agreed to.