FAMILY PROPERTY: LAW COMMISSION REPORT (Hansard, 18 July 1979)

§ The LORD CHANCELLOR
My Lords, this is rather a curious sort of procedure. I think we must try and get back to the Motion in the name of, if he will allow me to call him so, my noble and learned friend on the Cross-Benches; to call attention to the Third Report of the Law Commission on Family Property and the need to reform the law of married women's property, and to move for Papers.
My Lords, I say so as should not, but I was originally provided with rather a good speech to make; it was provided very largely by others, and so I think I can say so without immodesty. I am afraid that almost everything worth saying in it, although I shall have to repeat some of it, has been said and said rather better by the speakers who have preceded me in 1456 this debate, and this I am afraid is going to make my own final speech rather scrappy and to some extent unsatisfactory, for which I apologise in advance. I am quite sure that the House would wish me to begin by thanking my noble and learned friend on the Cross-Benches for introducing the subject, both from the point of view of the speech which he has himself delivered and of the opportunity which he has given to the other noble Lords who have participated to make their own comments upon the report. I share to some extent, in fact to a great extent, his disappointment that for various reasons for which none of us is responsible so few noble Lords have felt it possible to give the advantage of their opinions to the House, because I had been very much hoping that some test of opinion of the House, apart from the very experienced Lords who have taken part in the debate, would be available as a result of this debate. Indeed, the speech with which I was provided was based on the assumption that a large number of noble Lords would wish to speak, and that, therefore, they would wish the Lord Chancellor to speak rather earlier in the debate than I am doing. It was only when I discovered that only a few names were down that I decided that it would be much more appropriate, if I were to speak at the end.
I congratulate my noble and learned friend, and I think the immense contribution of knowledge, experience and humanity which he has brought to bear on this subject should be put on record. He is not only a man of immense erudition —his little excursus into the history of the subject is enough to illustrate that—and not only a person who has very clearly expressed and has humane views on the subject, but what he did not say, and what I can say from my own knowledge, is that he has an immense experience as president of the Family Division in the actual case load of the subject, without which it is very, very difficult to generalise on the subject of marriage or its problems.
I am also very grateful to the noble Lord, Lord McGregor of Durris, who speaks in effect from the sociological point of view and was able to bring to bear his personal experience of the matter. I think I only quarrelled with one thing that he said. I think he was wrong when he said that the old common 1457 law, which everybody now agrees effected a great deal of injustice, applied only to the common people and that the rich had somehow contracted out of it. I think if he had been an expert in the school of English lit. rather than sociology he would have arrived at a very different view. If one reads, for instance, the novels of Jane Austen, or the novels of Trollope rather later in the 19th century, I think one would be quite clear in ones own mind that the injustices of the common law bore as heavily in effect upon the professional and middle classes, and to some extent upon the rich, as upon what he described as the common people. Of course, one can only read between the lines of Jane Austen and Trollope, but one sees the pursuit of the heiress and one sees that consequence of the heiress's marriage to an unsuitable husband as creating the very dramatic situations with which those authors were concerned. I mention that because I believe that there is a little too much assumption these days—too much assumption that the rich were catered for, before the advent of Sir William Beveridge, in a very much better way than the poor in this respect. I do not believe that that is good social history.
It is necessary for me to begin by saying the obvious; namely, that what we are discussing is the property arrangements which exist during marriage and not the property arrangements which exist at the termination of marriage. My noble and learned friend in his opening speech made that very plain. But it is important to remember that because as the noble, Lord, Lord Mishcon, quite rightly pointed out, married couples do not usually go to law against one another unless their marriage is on the rocks. One wants to be very sure that the rights and liabilities of spouses do not tempt them to do so.
Marriage is the very foundation upon which society rests. The idea that a marriage will survive very long if the parties are dashing off to the family court —if there is one—or to the county court or the Family Division in the High Court, to decide questions of property, I do not think bears examination for a moment. I speak as a man who was married happily for 34 years. Like all married men who have been married for a long period, I had many disagreements from time to time 1458 with my wife. But, over that 34 years, think I can honestly say that I never had a disagreement about property at all under the existing law, and I do not think that I would have had any disagreement about property whatever during that 34 years even if the law had been different—whether worse or better. I think that one must bear that in mind.
On the other hand, the law of property which exists during the continuance of a marriage has a distinct bearing upon the law which applies at the breakdown of a marriage. The possible breakdown of marriages cannot be disregarded when one is considering the law of property affecting happy marriages because divorce is really entirely about custody of children, money and property. When the marriage comes to an end the divorce judge has to consider a number of quite different problems. The first is the maintenance of the spouses and their children. The second is the division of their property which may be different from, but still bears a relation to, their actual proprietary rights during the continuance of the marriage. Then he has to consider any transfers of property which take place as a result of the breakdown of the marriage. Therefore, although the question that we are deciding is the property rights between the spouses during the continuance of what is, one hopes, a happy marriage, it also bears a relationship to divorce and the consequences of a broken marriage.
Although, strictly, it is irrelevant to the Motion of my noble and learned friend, I should like to make a comment which might interest the House about " breakdown ". Obviously coming back, as I have, to the Woolsack after an interval of five years—it is rather like being Rip Van Winkle, only it is five and not 100 years—one is interested both in the resemblances and in the differences between one's first and second incarnation. One of the most striking differences which I have noticed already is the enormous number of letters coming from Members of another place to the Lord Chancellor enclosing constituents' letters complaining of the law relating to property after breakdown of marriage. There is a startling difference. They all have to be answered because they all make complaints, not so much about their individual cases—as regards which a 1459 Lord Chancellor can make no comment whatever, except that if they do not like the judge's decision they must appeal—but about what they call " the system ".
The letters break themselves down into, first, letters from husbands complaining that the system has moved too far in favour of wives. Indeed, recently there have been a great number of such letters because of a certain organisation which has been asking people to write to their Members of Parliament about it. Then there are the wives who complain that the best years of their lives have been given to their husbands, after which their husbands, when they have become old and perhaps less attractive, have gone off with a little bit of fluff. There are also letters from second wives who complain that the first wife nagged so badly that their husbands were driven away to go off with them, and as a result they cannot pay for the new family. It is said to be a very unfair system.
That brings me back basically to what my noble and learned friend on the Cross-Benches was saying. People must realise that, in fact, the relationship of husband and wife may have to be one of equality. As has been said more than once in the debate, it is a partnership between equal partners. However, the function are different. In another place—I think " out doors " as the old phrase in Parliament used to be—my noble and learned friend said that the cock may feather the nest, but the hen has to sit on the eggs and the cock is therefore free and under an obligation to feed her.
The functions of the wife and the functions of the husband are different in character. As a rule, the wife undergoes the burden of bearing the child—and I think that it was my noble and learned friend or perhaps the noble Lord, Lord McGregor of Durris, who raised this point—and she has the function of home making; and the husband, as often as not, is the wage earner. Thus, it is often the husband who has to pay maintenance at the end of an unhappy marriage. On the other hand, it is the wife who asks both for maintenance and for a share in the property whether it is the property acquired during marriage or the property acquired afterwards. Each in his and her own way has a case. It is a different case, however 1460 much equality there may be, because the facts of life provide them with differentiating functions, with differentiating consequences, relating to the possession of property and to the obligations after marriage.
I turn to the Law Commission Report which is the subject of the first part of my noble and learned friend's discourse. To begin with, I would share very much what he has said about the value of that body. I think that it has made law reform infinitely easier, although it is still almost incredibly difficult for a Lord Chancellor to introduce measures of law reform. However, it has made it infinitely easier than it was before, and the working paper, to which my noble and learned friend drew attention, is one of the most valuable devices which have been employed by the Commission. I was only disappointed that my noble and learned friend Lord Scarman was not present to take part in the debate, as I had hoped; I think my noble and learned friend Lord Simon was correct in giving him the credit for this valuable invention.
The Commission's report divides itself into three draft Bills. If I may say so, it is also a valuable invention that a parliamentary counsel should be available for the Law Commission—or, indeed, for other bodies—in order to embody the proposals in the report in a draft Bill. Before this was done, law reform was incredibly difficult because, effectively, no Private Member—even if he agreed with the recommendations of a law reform committee—could undertake the burden and technical difficulty of draftsmanship. Now Private Members of either House are free, if they will, to introduce a Bill with which they agree. If it is one of the Bills recommended by one of these bodies —the Law Commission or the Law Reform Committee—and has a draft Bill attached to it, the Member does not have to go through the business of draftsmanship; he can introduce the Bill and the Government are thereupon put under pressure to support it, to block it, or to give a definite answer about it.
The position about this report is unusual in that it contains three draft Bills. I shall not give exact figures because I should have to look at the Book in order to give them precisely, but there is a Bill about the home in Book One, which 1461 comprises about 35 clauses. I must say at once that I see no prospect of the Government legislating on that scale during the coming Session. That may be a disadvantage, or it may be an advantage, in that it will give public opinion more time to think about the matter. There is a short Bill about occupation, which I want to see on the statute book as quickly as possible. By what mechanism that is done, I cannot yet say; but if I can, I shall do my best to get it through. It is a manageable Bill; it is much shorter than the other Bill—I think it comprises 10 or 12 clauses. If the parties co-operate, I see no reason why we should not get that Bill through, perhaps during this Session.
The Bill about goods is, I think, more controversial, for the kind of reason which the noble Lord, Lord Mishcon, gave in his speech: it may create problems rather than solve them. At any rate, because the Bills are in the report, any Private Member can introduce them, either into this House or into another place, and they can be discussed at length. Therefore, that is a very great advantage.
I say in passing to my noble and learned friend who put these two questions before me, that I shall certainly ensure that the Keeling schedule, as I still like it call it — Schedule 2—of the intermediate Bill is considered before the Select Committee as he asked. I shall see that my office examines his suggestion most carefully in our various efforts to put the Bill on the statute book. I always wish that amendment Bills had Keeling schedules, but I am assured that it is impossible, both when I advocate it in Opposition and when I suggest it in Government. This is a consolidation schedule which would be very useful to the practitioner.
The other question which my noble and learned friend asked was about family courts. I do not think that I can give him very much satisfaction about that, except to say that if the system can be grafted onto the pyramid of existing courts, I am a family courts man, However, personally, I do not favour the creation of special tribunals or courts outside the hierarchy of the existing courts where it can be avoided. For a very long time the whole motion of legislation has been to try to co-ordinate the courts into one structure. I see no reason why family courts should not be introduced 1462 into that structure without destroying it. My noble and learned friend can be sure of my sympathy, but I am afraid that he can get no comfort from me because at the moment it forms no part of Government policy; it had no place in the Queen's Speech and I do not see it coming to fruition this Session. I can see a good deal of discussion and difficulty inside and outside the Government machine before it becomes law. However, I have not forgotten Mr. Justice Finer, who I think I appointed and whom we all miss today. My noble and learned friend will certainly have whatever little sympathy I can give, both inside and outside the Government if the matter of family courts can be properly co-ordinated.
I have stated a great deal of what is contained in my rather longer speech, which was prepared for me on a different hypothesis. There is one other point about the debate which surprised me: nobody mentioned tax. Tax is an extremely important question to consider in relation to the ownership of family property. This has a direct bearing, for instance, on the ownership of the family home. Perhaps I may instance a personal interest. Obviously, if the partners are not the same age, they do not expect to die simultaneously. In my case, my wife was very much younger than me and I was considering—though, in fact, I did not do so—putting the whole of the matrimonial home into her possession before I died. There were certain tax advantages to be gained in so doing, which I believe to be legitimate tax advantages. As matters took place, it happened the other way round. But let us suppose that this report had been the law and that there had been no statutory exceptions—and in my case there would have been a statutory exception because of the tax situation—when my wife died her estate would have gone, on a higher level of taxation, to the Revenue. When one is dealing with family property, one must not forget that the private arrangements between partners should not be put on a sort of bed of Procrustes, because, in fact, it may inflict the most incredible hardship in relation to the incidence of tax. I am bound to say that it rather surprised me that this was not raised.

§ Lord MISHCON
My Lords, the Commission's report, as I am sure the 1463 noble and learned Lord knows, dealt with this aspect, and that is why the period of two years was allowed in the report for the spouses to consider the tax position and contract out, as it were, of the statutory joint ownership.

§ The LORD CHANCELLOR
My Lords, I was intending to make that very point. I think that the report was right, not only about tax, but in general in allowing parties to contract out. For the circumstances of almost every marriage are different. The parties have different obligations. Sometimes they have had previous marriages; sometimes the property may be a family property. The more one learns about marriages, the more certain one is of the difficulty of forcing each marriage into a bed of Procrustes which is designed to fit all marriages and which, in fact, succeeds in fitting very few. As the noble Lord, Lord Mishcon, has reminded the House in his intervention, the report is sound on that very point—not only on tax but on the infinite variety of matrimonial life.
At the end of the day, I would suggest that the important questions on the matrimonial home which must be decided by public opinion are, first, should the differing roles of the spouses be recognised by the law in terms of property rights? I think that the answer to that has been given fairly clearly by the few speakers who have spoken as an emphatic " yes ", but still we should like further expressions of opinion. It is noteworthy—and I think it is contained in the report—that more and more families are in fact doing this very thing in relation to the matrimonial home, and, as both my noble and learned friend and the noble Lord, Lord Mishcon, have very rightly said, the survey of opinion, from whatever source it came, indicated that a large number of people agree with this view.
The second question is whether, if the existing law relating to the property rights of spouses during marriage ought to be changed, any reform should include the principle of co-ownership of the home. To that, my own answer—but it is not a Government answer—is, yes, it should, but there should be, for the reasons I have tried to elaborate, a means of contracting 1464 out. The third question is whether, if there is to be any co-ownership of a home, it should admit of any exceptions other than the right of the parties to exclude co-ownership by agreement. In other words, to what extent should co-ownership by compulsory? My own view is that the commission may have got it about right. I shall not elaborate on that any further.
Then the question is whether this should be enshrined in law. The Government have formed no view on this. My own view is that sooner or later we shall have to legislate, and there we have an instrument which we can either accept or modify. On the rights of occupation I wish to say very little because I have already said that I should like to see the second Bill on the statute book, and I derive a great deal of encouragement from knowing that it has had the support of all previous speakers. I shall see what I can do, including taking into account my noble and learned friend's suggestion about the Select Committee.
I am a little more doubtful about the Bill on household goods. I should like to think more about it. I am sure that we shall study all the speeches that have been made, but I should not like to give endorsement to it as at present because I had exactly the same reservations about it as were expressed by the noble Lord, Lord Mischon. I repeat, however, that all three Bills arc available for Private Members if they wish to put the Government on the spot. I think I have taken up enough of your Lordships' time. I am very grateful to my noble and learned friend for his Motion. I do not know whether he wants to put it to the vote. As he has moved for Papers, I should think probably not, but he will want to reply to the debate.

§ Lord SIMON of GLAISDALE
My Lords, in rising to ask leave to withdraw the Motion, may I thank noble Lords who have spoken for their most felicitous and valuable contribution to this subject. We are all deeply grateful to my noble and learned friend on the Woolsack for giving us an indication of his thinking. I think that the speeches today have vindicated the first two points of my Motion. As for the Papers, I do not know what they mean. I have so many papers unified 1465 that I have managed to lose my rail card among them, so, without hesitation, I ask leave to withdraw my Motion.