§ 2.58 p.m.
§ The Lord Chancellor (Lord Hailsham of Saint Marylebone)
My Lords, I rise to move that this Bill be now read a second time. It is the last in the series of four law reform Bills which I have now brought before the House prior to the Recess.
The Bill remedies problems arising under various nineteenth century statutes allowing individuals to donate land for charitable purposes on the basis that, if the land ever ceased to be used for the stated purpose, it would revert to the donor or his successors.
985 The technical name for this is "reverter". Hence the short title of the Bill. The problems arise when, once reverter occurs, the donor or his successors cannot be found or identified. I am happy to say that, according to the information available to me, the Bill enjoys general support from the legal profession and the Churches.
The statute that has most frequently given rise to problems is the School Sites Act 1841. Before the provision of universal compulsory education (dating from the Elementary Education Act 1870) schools were endowed mainly from private sources, sometimes with assistance from public funds. Many parts of the country had been miserably provided with schools. Organisations such as the National Society for Promoting the Education of the Poor in the Principles of the Established Church throughout England and Wales (now generally known by its short title the "National Society") encouraged and assisted in the provision of sites for schools for the poor throughout the country. My own grandfather and the grandfather of my noble friend the present Lord Kinnaird and that great friend of the friendless in the nineteenth century the seventh Earl of Shaftesbury all co-operated in the ragged school movements. There were legal obstacles of a largely technical nature to be overcome. Accordingly, the National Society pressed for the legislation which resulted in the School Sites Act 1841. The Act established a procedure whereby landowners could convey sites to be used for schools, with the conveyance containing a proviso that, if the land ever ceased to be used for that purpose, it should automatically revert to the original landowner or his estate.
After the School Sites Act 1841 came other statutes with broadly similar provisions for reverter. These statutes included not only other School Sites Acts but also Acts dealing with the provision of sites for libraries and museums (the Literary and Scientific Institutions Act 1854) supported, I believe, by my ill used and much maligned predecessor Lord Brougham, and the provision of sites for churches and chapels (the Places of Worship Sites Act 1873). As the reverter provisions contained in those statutes were modelled on the 1841 Act, the difficulties created by those provisions are common to conveyances of land made under all these Acts.
Reverter provisions of this class create difficulties only if the school or other building erected on the site ceases to be used for the particular purpose for which the site was granted. But over the last 50 years a number of factors have contributed to the closure of many such schools and churches. In particular, the Education Act 1944 resulted in the closure (or transfer to new sites) of many voluntary schools. Once the school or other building ceases to be used for its particular purpose, according to the statutes the land ought to revert automatically to the owner or his successors in title. But in that case two problems arise. The first and principal problem is that, since many of these grants were made a long time ago, it has become either difficult or impossible to identify the owner or his successors in title. The second difficulty (which arises from the first) is that, after reverter, if they remain in possession, the grantees or their successors no longer have any powers to dispose of the land.
986 Thus, they cannot sell it and they cannot use it to raise money to pay bills. In such cases the building inevitably deteriorates and may be left derelict or in a dangerous condition.
In 1977 representations were made to the Law Commission and others to the effect that the reverter provisions in question were giving rise to insoluble practical difficulties. A working party was therefore established under the Law Commission to examine the problem. In 1981 the working party reported and later that year the Law Commission published the report under the title Rights of Reverter (Law Commission Report No. 111). That report contained a number of detailed recommendations to deal with the problem of the untraceable owner. The principal recommendation was that within three years owners should register their claims to ownership of the land, and, if they did not do so, their rights would be extinguished. However, this solution was felt by some to be unduly draconian and almost to amount to expropriation, and the report was accordingly not adopted.
Accordingly, the Bill proposes to face the problems by another route. When land ceases to be used for its original purpose, the trustees holding the land are to be given the right to manage it and keep it in repair. If the beneficial owner cannot in fact be identified, the Bill enables the land to be sold and the proceeds of sale to be put into a charitable trust.
By Clause 1, once the land ceases to be used for its original purpose, grantees will be given the status of trustees for sale. As such they will have power to manage the land and sell it with a good title. They then hold the land or, as the case may be, the proceeds of sale on trust for the true owner, that is, the reversioner. The status of trustee for sale is conferred even where reverter occurred before the legislation takes effect, so that trustees can deal in the future with land that has reverted in the past. But to prevent true retrospectivity—if that is a proper word—provision is made to protect the existing rights of the reversioner. Provision is also made to prevent the revival of rights that have already become statute barred.
The question then arises as to what is to be done if there are no legitimate beneficial claimants. In that case Clauses 2, 3 and 4 provide for the Charity Commissioners to establish charitable schemes, so that the property held by the trustees as trustees for sale under Clause 1 may be put into charitable trusts. The charitable purposes allowed will be as similar in character as the Charity Commissioners think practicable to the original purpose for which the land was held. However, before applying to the Charity Commissioners for a charitable scheme, unless the reverter occurred more than 12 years ago (when of course it is already statute barred), the trustees must take steps to trace the true owner if they can. These steps include advertising in two national newspapers and a local newspaper, and posting a notice on the relevant land. If, after three months, the owner has still not claimed the land, the Charity Commissioners may then establish their scheme. Once this has been established, the rights of the owner will be extinguished. Nevertheless, his rights of property are still protected. He becomes entitled to compensation if he lodges a claim within the next five years. The 987 charitable schemes are to be publicised, and there is provision for appeals against them. After the expiry of five years the rights of the reversioner to compensation are extinguished or lapse.
Under Section 2 of the Education Act 1973, the Secretary of State has powers to make educational schemes. These powers may at present be exercised in cases where reverter under the School Sites Act 1841 has not yet occurred. Clause 5 of the Bill extends these powers to include cases where a reverter has already occurred. Provision is made to ensure that the powers are not exercised to extinguish rights of ownership without the Secretary of State first being satisfied that all reasonably practicable steps have been taken to trace any persons lawfully entitled.
Clause 6 contains provisions clarifying the existing law. In particular, these provisions resolve obscurities relating to powers of sale conferred by Section 14 of the School Sites Act 1841.
Clause 7 is interpretation. It specifies the nineteenth century statutes to which the Bill relates. Clause 8 deals with consequential amendments, repeals and savings. In particular, it clarifies a power of the Secretary of State under the Education Act 1946.
This Bill represents a useful and, I hope and believe, uncontroversial measure of law reform which has attracted the support of the legal profession and the Church authorities. I accordingly ask this House to give it a Second Reading. I beg to move.
§ Moved, That the Bill be now read a second time.—(The Lord Chancellor.)
§ 3.10 p.m.
§ Lord Elwyn-Jones
My Lords, despite the transport difficulties which the noble and learned Lord has to confront, being in charge of the Bill and presiding from the Woolsack—a task with which I am not unfamiliar—we are most grateful for his account of this important Bill. I venture to congratulate the noble and learned Lord on introducing the fourth of a series of law reform measures. We must also pay tribute to the Law Commission, and in this particular case to the working party to which I shall refer in a moment.
As the noble and learned Lord has so clearly explained, the need for the Bill arises from various nineteenth century Acts of Parliament containing provisions under which ownership of land granted for schools, churches and other charitable purposes reverts to the owner of the land when the land ceases to be used for those purposes.
As long ago as 1977, representations were made to the Law Commission by the Churches Main committee and other bodies—sit may be that the right reverend Prelate will have a little to say about this—to the effect that these reverter provisions contain defects and anomalies giving rise to serious practical problems. In particular, the difficulty of identifying those entitled under the reverter provision was resulting in the sterilisation of valuable areas of land.
The working party set up in 1978—I cannot claim any personal responsibility for it—was obviously a good thing. It was chaired by Mr. O'Brien of the Law Commission and included representatives of various 988 bodies with a direct interest—Church Commissioners, the Baptist Union, the Church of Wales, and, of course, the Charity Commissioners.
The working party report is a fascinating picture of this country's social and educational history. It is an appalling reflection that for centuries most of our children could neither read nor write. Our culture was communicated by the spoken word. Thank goodness! How marvellous it was in the language of Shakespeare. Everyone could understand, but they could neither write nor read. One thinks of the loss to this country when generations were denied the opportunity of education. But it was, I suppose, a common feature in most of the civilised world at the time.
However, there came the Elementary Education Act 1870 from which incidentally my own father benefited. He was able to go to school until the age of 14 which was a great achievement. He made up for that fact by becoming superintendent of the Tabernacle Sunday School for 60 years thereafter. I am sorry that the Leader of the Opposition is not here, because Wales was fortunate to have the energy and commitment of the chapels and their schools under the leadership of the Reverend Griffith Jones of Llanddowror and, by origin, I am happy to say, of the Reverend Thomas Charles, of Jesus College, Oxford. I do not know why I am particularly happy but he derived his roots from there.
Wales had the benefit of Sunday Schools which, in those days, were regularly attended by most children, including, a little later, myself. It was, if I may make a public confession, rather an ordeal. We had Sunday service in the morning where it was one's duty to recite a part of the Bible, Sunday school in the afternoon, and chapel at night. There was often a rehearsal of "Messiah" in the chapel—performed each year. It was a cultural background from which we were lucky to profit and benefit.
England, too, has had its commitment from the churches. I have no doubt that the right reverend Prelate will say something about the work that was done by such bodies as the National Society for promoting the education of the poor in the principles of the established Church throughout England and Wales. It is interesting to note how the matter was put in those days. I have no doubt that it served a useful purpose in its time.
As the noble and learned Lord the Lord Chancellor has indicated, the passage of time has increased the difficulty and costs of interpreting and carrying into effect the reverter provisions contained in those nineteenth century Acts. The problem arises only if and when the building, erected on the affected site, ceases to be a school, chapel or whatever the particular institution may be. I assume that the provision in regard to churches and chapels also applies to land provided for libraries and museums. I see an affirmative nod denoting that that is so.
It is not only the community of churches and chapels that is affected, but a wider range of public concern and importance. As the noble and learned Lord has said, since the 1914–18 war, a number of factors (some beneficial) such as the Education Act 1944, in particular, have led to the closure, or the transfer to new sites, of voluntary schools, creating the 989 problem that we now face. What has been saddening to see is the extent of the closure of churches and chapels in many places throughout the country. In our villages chapels of considerable architectural merit and worth are now garages or places of that kind. However, attempts have been made by various bodies to maintain the buildings of the churches and chapels of cultural value.
It may be of interest to learn from the noble and learned Lord—although the statistic may not be available—how many sites are likely to be affected by what is proposed. It may be difficult to give an estimate, but it probably runs to many hundreds. Therefore, the Bill is an important one to place upon the statute book.
No Bill has been subject to so much consultation. If one looks at the Law Commission report it would seem that a vast number of government departments, local authorities, ecclesiastical authorities, legal societies and individuals have been consulted. Therefore, it is perhaps no wonder that it took three years for the working party to produce its excellent report and send it to the Lord Chancellor's office in 1981. A further five years of gestation have produced this Bill. There is no doubt that the Bill has had to deal with all the complexities and contingencies that may arise. However, here it is at last.
Clearly, much of the responsibility for carrying out what is intended in the Bill will fall upon the Charity Commissioners. We are indeed fortunate that they exist and are capable of coping with the problems that are likely to arise. There are provisions for appeal to the High Court against any order made by the Charity Commissioners establishing a scheme extinguishing the rights of beneficiaries under trusts. No doubt that is a desirable provision.
I notice from the date of commencement provision that the Act is to come into force,on such day as the Lord Chancellor may by order made by statutory instrument appoint".I wonder whether the noble and learned Lord can give us some hint of or guess at—it probably cannot be much more—the state of preparedness of that statutory instrument. Time has passed. We have waited for these provisions for years, and until the Act comes into force we must continue to wait.
Incidentally, I note that the Bill applies only to England and Wales. I wonder whether there is any provision for Scotland; or is Scotland free of the blight or benefit of the reverters—I do not know how to put it? Perhaps wearing his Great Britain-wide hat the noble and learned Lord will give us some guidance. I am sorry; I see the noble and learned Lord the Lord Advocate. He can no doubt answer my question if the opportunity arises.
This is obviously a good Bill. We and those we have consulted have in mind nothing specific by way of amendment that we presently want to propose, but clearly the Bill will have to be considered with care. We welcome it strongly.
§ 3.22 p.m.
§ The Lord Bishop of London:
My Lords, I too am happy to welcome the Bill on behalf of those who sit on these Benches. The noble and learned Lord the 990 Lord Chancellor will not be surprised to hear me say that, because I have been writing to him at intervals over the past few years urging that the Bill should come before your Lordships. I am glad that we are now considering it. I should like to say how grateful I am to him for his generous and, as usual, lucid exposition of the Bill.
I am sorry that the Bill had not been passed in 1955 when I first became a diocesan director of education, and in 1958 when I became general secretary of the National Society. It would have saved me a great deal of time and effort, but I suspect that it would also have meant that many in the legal profession would have lost considerable fees. It is good to have the Bill now and I am glad to welcome it, I am grateful to the noble and learned Lords the Lord Chancellor and Lord Elwyn-Jones for the generous manner in which they have recognised the pioneering way taken by the Church in education in this country. That is often forgotten these days.
From time to time people say some rather harsh things about the clergy. When I was general secretary of the National Society, I made it my business to look back in the records to see the accounts of many of those early schools founded under the Schools Sites Act 1841. They showed the costs of the schools which were mostly taken up by the costs of the teachers' stipends. When I looked at how that was met, I saw that a good contribution was made by the local landowner and there were certain local subscriptions. Again and again at the bottom I saw:Balance found by the vicar".We underestimate the extent to which the early days of our education system were not only encouraged and pioneered by the clergy but were supported by them, often at considerable cost to themselves.
One of the great joys of being general secretary of the National Society—I say this in the light of what the noble and learned Lord, Lord Elwyn-Jones, said—is that the National Society, unlike the official bodies of the Church of England, extends into Wales. It was then that I began to make regular excursions into the Principality. I remember that on my first visit people were concerned to impress on me how they had been in the van of education long before we in England had ever begun to think about it. I remember being told that a school down at Llantwit Major was the oldest Church school anywhere in these islands. Their claims became more and more extravagant. Finally, I had to tell them that if they made it out as starting any earlier it would be a Church school founded in the days that we call "before BC". I appreciate the part played by Wales in our education system.
§ Lord Cledwyn of Penrhos
My Lords, it may be of interest that it is a historical fact that Saint David was educated at the school in Llantwit Major, known in Welsh of course as Llanilltyd Fawr. The school has good grounds for being called the oldest school in Britain.
§ The Lord Bishop of London
My Lords, I am most obliged to the noble Lord for what he has said. As one who has been Bishop of Cornwall, I do not need much encouragement to think highly of the part played by our Celtic forebears in our Christian civilisation.
991 As the noble and learned Lord the Lord Chancellor made clear, we have never sought to remove the rights of reversioners. Our concern has always been for those schools where the reversioner cannot be found. It may be that the noble and learned Lord has other information, but I have been told that there are as many as 1,500 schools with reverters on the whole or part of the site. Those are the figures with which we shall have to deal. In only a few of those cases can the reversioner be traced. Such reversioners as can be traced are usually Members of this House or their descendants. There is usually not much difficulty in tracing them. They are not the problem. The problem occurs when the estate has been broken up, and so forth, and with the great number of benefactors in Victorian times who purchased a piece of land and gave it to the Church under the Acts mentioned in the Bill, and whose descendants cannot now be found. The Bill is directed towards remedying that problem and it is much to be welcomed.
We are concerned that the Bill should be as workable as possible to remedy the difficulties which we face under earlier legislation. I hope it will not be taken as in any way minimising my strong welcome for the Bill if I mention one or two points to which I hope attention can be given. The first is that we are a little worried about the five-year period which, in terms of the financing of the transferred schools, may present some problems. I hope that some thought will be given to whether that five-year period before the proceeds can be made available to the Church or the local authority, for example, with controlled schools can be looked at again. We hope that the procedure for sale, which greatly improves that under Section 44 of the Schools Sites Act, covers the point. We have some reservations about that.
There is one other point on which I should like to ask for some assurance. As the noble and learned Lord the Lord Chancellor has made clear, in the case of schools where the reversioner cannot be found, the Bill enables the Secretary of State to act so that the estate can be available for church schools. That is discretionary. We should like some assurance that it will be the Secretary of State who will do that, as we believe it is proper for him to do so and not for it to be left to the Charity Commission. That is not guaranteed under the Bill as it stands. It may be that it will be possible to provide that, if it is an education charity, it is the Secretary of State who would normally act under the Bill.
With those modest reservations—and I note that they are being looked at by those concerned—I should like to express a welcome to the Bill on behalf of those of us on these Benches and, indeed, I know that the Bill is warmly welcomed by the Churches Main Committee, on which all denominations are represented and of which I am chairman. It is also very much welcomed by the Church of England Board of Education and by the National Society. I very much hope that it will have your Lordships' warm agreement as it goes through the House.
§ 3.30 p.m.
§ Lord Denning
My Lords, I should like to welcome the Bill on behalf of my native town of Whitchurch in 992 Hampshire and on behalf of the school to which I went 80 years ago. That school is built of the materials of 1845, mainly of flint laced with brick, and there, in bold figures on the top, is the year 1845. From 1845 for the next 120 years it was used for the education of children of Whitchurch, including me and my brothers. But then, in about 1966, the education authority built a fine big school half a mile away on the other side of the town and the children no longer went to our old school.
What was to be done with it? The answer is that no one knew to whom it belonged. No one could say what was to be done with it. If we look at the 1841 Act, it says, as regards the owner who granted that land for use as a church school, that, if it ceased to be used as a church school, it would revert to him and his successors. But no one could find him; no one knew anything about him. To whom was it to revert? What was to be done with it? No one knew.
What happened in our little town was that someone applied to Hampshire County Council or to the local education authority. The place was used temporarily as an ambulance station, and after that as a creche, because no one knows who is the owner of it, who is to deal with it or who has the control of it. That is the problem facing the Law Commission and the 1,500 to 2,000 other places like us—what is to be done. I am glad that the Law Commission proposal of a Commons Register has gone because that would take much too long.
There is only one query on the Bill. Clause 1 says that is to have effect as if it was to be vested in the persons in whom it was vested immediately before 1966. The Bill does not tell us who are the persons in whom it was vested immediately before the censer of use. I hope that that will be cleared up in Committee or at some stage because I should like to know—we should all like to know—in whom this land is vested now. The rest of the Bill is simple. There are to be trustees, if you please. What then is to be done with it? The Charity Commissioners are to fund a scheme. That is a very good thing. But what is it to be for? Is it for education any more, as originally granted? Hardly that, because the education authority deals with all those purposes.
In a later provision in the Bill it is stated that the commissioners, in determining the character of the purposes, to use it for those purposes as far as they can,may give greater weight to the persons or locality benefited by the purposes than to the nature of the benefit".They do not go to the nature of education so much in aiming at a scheme—that has gone by the board. They have to go to the persons or locality; that is, to the people and to the church in our locality. That is what the scheme is to be, a charity, so to speak, for us. What a good thing, because this site, which has been left unoccupied and unused for 20 years, is now of great possible development value. I hope that when the scheme is arranged by the Charity Commissioners they will give due weight to the benefit of our people and our children in the future.
I greatly welcome the Bill for clearing up all these ambiguities, but with this one reservation: please make it clear who are to be the trustees.
§ 3.37 p. m
§ The Lord Chancellor
My Lords, I am very grateful to the right reverend Prelate and to all noble Lords who have taken part in the debate. I am also grateful for the general welcome which I think I can claim the Bill has now received. I noted what the noble and learned Lord, Lord Elwyn-Jones, said, and what the right reverend Prelate said, about Wales. I love the English, but I have hardly a drop of English blood in my veins, and only one great grandmother out of all my great-grandparents could claim to be English. My loyalties and culture are English, but I have always thought the English rather funny. I have thought that one reason that they are rather funny is that, despite what was said by the noble and learned Lord on the Cross Benches, in the main the English think that brains are wicked and that the stupid are good. This I regard as an amusing heresy which I do not altogether share.
The noble and learned Lord, Lord Elwyn-Jones, asked me how many sites are affected. The right reverend Prelate gave some figures, but the working party established that a total number of about 5,000 sites, of which 2,000 or more are school sites, the others being churches, libraries and so on, may be affected.
One of the many difficulties of giving figures is, first, that we do not know in many cases where these places have been closed whether it is really true that the owners cannot be found; and, in a number of cases, if reverter has taken place more than 12 years ago, the true owners, even if found, would find themselves to their misfortune statute-barred before the Bill becomes law. Therefore, it is difficult to be accurate. I hope that if I turn out to be inaccurate I shall be excused any charge of deceiving the House.
The noble and learned Lord asked also about commencement. We hope that the Bill will come into force about six months after Royal Assent. This is because under the Bill I shall need time to make rules about appeals to the High Court before it can be effective.
The position about Scotland—one noble and learned Lord spoke on this, for which I am grateful—is set out at paragraph 119 of the Law Commission Report, to which reference has been made. In Part V under the heading "Concluding Remarks"—like mine—the commission said:We feel that we ought to mention that the contents of this report may be of some (but perhaps only passing) interest in Scotland and Northern Ireland. While the Places of Worship Sites Act 1873 operates only in England and Wales, the School Sites Act 1841 extended to Scotland and the Literary and Scientific Institutions Act 1854 to Ireland (but not, it appears, to Scotland). Nevertheless, we doubt whether there is any real need to extend the legislative repairs recommended in this report beyond England and Wales. In the first place the problems deriving from the Law of Property Act 1925 (which have become urgent because of the conflict between Re Ingleton Charity and Re Clayton's Deed Poll) are naturally confined to England and Wales. Secondly, we gather that the School Sites Act was very little resorted to in Scotland and potential problems in relation to cases left behind by the repeal of the Act there may be too few to warrant legislative attention at this stage. The same may well be thought to apply to the Literary and Scientific Institutions Act so far as Northern Ireland is concerned".That dealt with the excellent speech of the noble and learned Lord.
994 The right reverend Prelate quite rightly took pride in the part which the Churches, and particularly my own and his denomination, have played in the work of education in the early years before the state took it on. It is worth saying that it was the Church, not only in the field of education but in all the so-called corporate works of charity, that initiated these matters. For instance, when Florence Nightingale wanted to re-discover the art of nursing, where did she go? She went to a group of Roman Catholic nuns who had kept the art alive, and developed it. The same is true about relief of the poor. It was the Churches, and the medieval Church in particular, which thought of these matters long before the welfare state was a blush on Lord Beveridge's cheek. This country is still a Christian country, it is important to emphasise that. It is still a Christian country because much of the heritage which we derived from the Christian religion is now enacted in the law of the land.
The right reverend Prelate went on to ask me two questions. I do not think his point about the five-year period is necessarily well conceived. The five-year period is the period beyond which the reversioner's claim ultimately expires, but it has no relevance at all to the trustees obtaining access to the funds. They are, as trustees for sale, in possession of them as from the date of sale. The right reverend Prelate also suggested that there is need for the Bill to contain further provisions to enable the Secretary of State to return school sites to the educational system. In particular he thought that the Charity Commissioners simply have a discretion to do so. In fact it is true, as he rightly has seen from his perusal of the Bill, that the Charity Commissioners have a discretion. However, the Secretary of State has adequate powers under Clause 5 and Clause 8(1) of the Bill. I think that is the answer.
I was very grateful to the noble and learned Lord, Lord Denning. The school would now belong beneficially to the owner, whoever he may be, but the existing persons who have operated the school would be trustees for sale on the terms which I sought to explain in my opening speech.
That said, I think that I have exhausted the subject unless there is any further question which noble Lords wish to ask me. I therefore beg to move that this Bill be now read a second time.
§ On Question, Bill read a second time, and committed to a Committee of the Whole House.