Lords Sitting of 5 February 1990

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Southwark.

Airport Capacity
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
What progress in the light of current forecasts has been made in planning additional airport capacity in South-East England.
Viscount Davidson: My Lords, the Civil Aviation Authority is to advise this summer on the adequacy of UK airport capacity to the year 2005, in response to a commission given to it by the Government in July 1988.
Lord Boyd-Carpenter: My Lords, I thank my noble friend for that reply. Can he confirm that the Government in general and the Department of Transport in particular are fully aware of the urgency of the situation in the light of the growth in air traffic and the risk of losing air traffic and airline services to airports such as Charles de Gaulle or Schiphol, where there is adequate accommodation and likely to be so for some years?
Viscount Davidson: My Lords, the Government fully accept the need to press ahead on airport capacity. However, very complex works are involved. It is important that decisions are taken in the light of properly considered and researched advice.
Lord Underhill: My Lords, I appreciate the reply of the noble Viscount. Does he recall that in the letter sent by the Secretary of State to the chairman of the Civil Aviation Authority last October he urged that there should be no hurried decisions? The words that he used were that there should be no decisions in the margin. He made it absolutely clear that there should be no further development on any greenfield sites.
Regarding the further advice to be given by the CAA in the summer, has the authority been asked to indicate exactly the full role that the regional airports could play in the future?
Viscount Davidson: My Lords, all these matters are included in the remit of the CAA. Its advice will include forecasts of air space and airport capacity. It will examine the contribution of regional airports, consider possible locations and timing of additional runway capacity to serve the South-East and examine the merits of possible demand management measures.
At the moment it is examining air traffic control and aviation industry aspects of the matter. We do not expect the CAA to do more than identify the
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wider factors. Those, including environmental concerns, will need to be considered in a broader forum.
Lord Cledwyn of Penrhos: My Lords, are the obvious advantages of Cardiff Airport being taken into account by the authorities? The airport in Cardiff is now as modern as any in the country outside Heathrow and Gatwick. Also, Cardiff is in close proximity to the Midlands and London.
Viscount Davidson: My Lords, I cannot comment in particular on Cardiff Airport. However, I can say that the Government already encourage the use and development of all regional airports to handle all the traffic they can attract. The Government have recently agreed the construction of a new £275 million terminal for Manchester and are negotiating with the USA over extra services.
The regional airports' share of all traffic is forecast to increase significantly, growing faster than that of the London airports. We welcome that and we are sure that it includes Cardiff.
Lord Tordoff: My Lords, in order to facilitate the movement of air traffic, are the Government re-examining the use by the Ministry of Defence of air space, particularly up the east coast? If some of that space were handed over to civil aviation, would not considerable relief be given to air traffic control over the whole country?
Viscount Davidson: My Lords, the Government are prepared to look sympathetically at applications for the civil use of MoD airfields where that is compatible with the operational role. The civil enclave has already established RAF Manston as the Kent international airport.
Lord Tordoff: My Lords, I am sorry; I was talking about air space, not airfields.
Viscount Davidson: My Lords, I apologise; I did not hear the noble Lord. I shall write to him about air space.
Lord Jenkins of Putney: My Lords, when reaching a decision on this matter will the Government take into consideration that the people of London are already overflown to a greater degree than the people of any other capital city? Would it be worthwhile to consider the possibility of pricing the situation so that it becomes cheaper to land at regional airports and dearer to land in London?
Viscount Davidson: My Lords, that is an interesting suggestion and I am sure that the CAA will take note of it.
Lord Whaddon: My Lords, will the noble Viscount bear in mind that the majority of aircraft on the British register are general aviation aircraft? Will he be careful not to squeeze those aircraft out of every airfield within reach of London?
Viscount Davidson: Yes, my Lords. That point will be taken note of.
Baroness Seear: My Lords, will the noble Viscount give proper recognition to the conversion of the noble Lord, Lord Jenkins, to market economics?
Viscount Davidson: My Lords, yes; I shall recognise that. I am grateful to the noble Baroness for reminding me of it.
Lord Jenkins of Putney: My Lords, is the noble Viscount aware that I have always been in favour of a mixed economy, provided the mix is right?
Viscount Davidson: My Lords, I am delighted to hear that. However, I think it is straying a little from the Question on the Order Paper.
Lord Boyd-Carpenter: My Lords, will my noble friend add to the economic information which he has given and received by bearing in mind that if we make Heathrow and Gatwick too expensive a great deal of traffic will go not to our regional airports but to European ones which are more economical?
Viscount Davidson: That, my Lords, is another side of the coin.

Cambodia: Self-Determination
2.42 p.m.
Lord Molloy Lord Molloy asked Her Majesty's Government:
Whether they are satisfied that everything is being done through international bodies to prevent Pol Pot from regaining power in Cambodia.
The Minister of State, Foreign and Commonwealth Office (Lord Brabazon of Tara):My Lords, it is generally agreed that there can be no place in the future of Cambodia for Pol Pot and his murderous associates. The Cambodian people deserve the right to decide their own future, free from the fear of Khmer Rouge atrocities, foreign occupation or civil war. We are actively helping to promote self-determination for Cambodians through free, fair and democratic elections. We and our fellow permanent members of the United Nations Security Council are working to carry forward the proposals made by the Foreign Minister of Australia for an enhanced role for the United Nations.
Lord Molloy: My Lords, I thank the Minister for that reply. Is he aware that the people of Cambodia are one of the most ancient civilisations in the world? They have suffered the most horrible regime that mankind has probably ever seen. The United Nations record in trying to relieve those people of the murderous activities of the communists under Pol Pot is not much of an encouragement to anyone. Will the Minister say whether the Australian proposals will now be made a reality in the interests of ensuring that the sham organisations which Pol Pot still controls will not be given power even by the United Nations?
Lord Brabazon of Tara: My Lords, our repugnance for the Khmer Rouge is well known. However, as I said in my original Answer, we shall do our best to play our part as a permanent member of the five members of the United Nations Security Council. We attended the first meeting in Paris on 15th and 16th January, and we look forward to attending another meeting later this month. The Australian proposals for greater United Nations involvement are currently the best way forward.
Lord Cledwyn of Penrhos: My Lords, we on this side fully agree with and support everything the Minister said in his original reply to the Question. In view of the fact that the Minister has just recently returned from Thailand, can he confirm that the fund from the UN which should be used to help the refugees in Cambodia is used for that purpose and that it is not used by the Khmer Rouge army? Further, in view of the dangerous advances being made by the Khmer Rouge at the present time, does the Minister agree that the implementation of the Australian peace plan now takes on an even greater urgency?
Lord Brabazon of Tara: My Lords, as regards the noble Lord's first point, during my visit to Thailand recently I visited Site Two on the border where some 140,000 or more Cambodian refugees or displaced persons live under the United Nations border relief organisation. I once again made it clear that any funds we provide to that organisation should be solely for the use of those refugees and similar people, and that none should go to the Khmer Rouge. I was assured that everything possible is done to prevent such supplies going to the Khmer Rouge. On the second point on the Australian proposals, as I said, there has been one meeting of the permanent five members of the United Nations Security Council and there is a proposal for a follow-up meeting later this month. In the meantime, I hope that those two members of the permanent five most closely involved will gain agreement from their clients that this is the best way forward. We hope in the not too distant future to have a reconvening of the Paris conference where all parties could reach a settlement.
Lord Rea: My Lords, are the Government working towards the replacement of the representation at the United Nations of Cambodia by the coalition government which is dominated by the Khmer Rouge, by representatives of the Hen Sun government, which is now universally recognised to be the de facto government of Cambodia and is thought to be doing a reasonably good job under very difficult circumstances? Will the Minister also tell us the outcome of the diplomatic mission to Cambodia which took place just before Christmas whose aim was to find out Cambodia's needs for development aid?
Lord Brabazon of Tara: My Lords, the matter of the occupancy of the United Nations seat by Cambodia was settled back in October for the time being. However, we recognise that we shall have to return later to that matter. There is no doubt in my mind that that would form a part of the peace

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proposals if they proceed. The occupation of that seat will be a key factor in that process. Regarding our own mission, which involved one person from the Overseas Development Administration and one of our diplomats from Bangkok, they reported back to the non-governmental organisations at the beginning of this month, and we look forward to seeing further proposals put forward by NGOs for humanitarian aid within Cambodia. We have set aside £1 million for that purpose.
Lord Cledwyn of Penrhos: My Lords, this may be a difficult question to answer, but I should like to ask whether there is any danger that the Khmer Rouge might occupy most of Cambodia before the Security Council is able to act and before the Australian plan is put into operation.
Lord Brabazon of Tara: My Lords, that is a difficult question to answer because of what is happening day by day on the ground in Cambodia. However, the current situation is that the Phnom Penh government hold around 90 per cent. of the territory, and the resistance groups —not just the Khmer Rouge but also other resistance groups —hold about 10 per cent. It appears —I can only say that it appears to be the case —that there is more or less stalemate on the ground at the moment.
Lord Molloy: My Lords, does the Minister not agree that there is now an urgent necessity for the United Nations and international forces to work swiftly as words are not enough? Words are beginning to turn sour because there is not enough action. Does the Minister not also agree that the United Nations should put some pressure on the Chinese communist government to stop supplying Pol Pot and the Khmer Rouge with the arms that they use to murder their own people? Does not the Minister also agree that the European Parliament could support the possibility of the Hen Sun grouping with an international force which could then start to bring some form of peace to that troubled land?
Lord Brabazon of Tara: My Lords, I agree with the need for urgency which the noble Lord has expressed. However, the meeting of the five permanent members on the Australian proposals was a good sign. China is one of those permanent members. Therefore we should draw encouragement from the fact that China put its name to the 16-point plan that came from that meeting.

Narrow Money Indicator: Target Range
2.50 p.m.
Lord Bruce-Gardyne Lord Bruce-Gardyne asked Her Majesty's Government:
When they now expect the narrow money indicator (MO) to come back within the target range set for it at the time of the 1989 Budget.
The Paymaster General (The Earl of Caithness): My Lords, MO's growth rate has fallen appreciably
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since its peak in the summer of 1988. The Government will continue to take whatever steps are necessary to ensure that it reaches, and remains within, the target range.
Lord Bruce-Gardyne: My Lords, I am grateful to my noble friend for that reply. Can he place the conduct of MO in the scale of the Government's priorities and concerns in monetary policy? Is it at the top or is it wandering along somewhere near the bottom?
The Earl of Caithness: My Lords, MO has proved a reliable indicator of monetary conditions. Therefore we take particular note of it. It is the only monetary aggregate that is targeted, but we look at other measures such as M4.
Lord Bruce of Donington: My Lords, in the event of the indicator MO remaining outside the target range set by the Government, will they admit to the failure of their policies to meet the target? Alternatively, as on so many previous occasions, will they consider abandoning the indicator, as they did with M4 and M3?
The Earl of Caithness: My Lords, we believe that MO will come within its target range. However, forecasting is a hazardous business and I shall not make a forecast today. I know that the noble Lord would like everything to be under the strict control of the Government, but MO is not necessarily under such control because it takes into account consumer expenditure.
Lord Ezra: My Lords, will the noble Earl indicate whether the Government attach any importance these days to the related indicator of broad money? They paid attention to it up to 1985 but have since lost interest in it. Is the Minister aware that the broad money indicator for the UK is substantially in excess of that for any other OECD country, with the possible exception of Australia, and that that is an indication of an excess amount of credit in the economy?
The Earl of Caithness: My Lords, as I said to my noble friend Lord Bruce-Gardyne, we take the broad money indicator M4 into account.
Lord Bruce-Gardyne: My Lords, do not the figures quoted by the noble Lord opposite suggest that there must be evidence for believing that monetary policy is still more lax than it should be for the comfort of Her Majesty's Government?
The Earl of Caithness: My Lords, we continue to review both monetary and fiscal policy on a regular basis. If further measures are needed they will undoubtedly be taken.

Water Levels: Southern Region
2.53 p.m.
Lord Nugent of Guildford Lord Nugent of Guildford asked Her Majesty's Government:
What were the levels of reservoirs and aquifers in the southern half of the country at 1st January 1990 compared with average, and whether they foresee any danger of drought next summer.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Hesketh): My Lords, reservoir levels were about normal except in the South-East, where they were about 60 per cent. of normal. Aquifer levels ranged from below to above average except in the South-East, where they were still well below normal. As for next summer, water undertakers in the West and central areas believe that the risk of shortages is relatively low. Those in the South-East and East risk being short of water if rainfall this winter is insufficient to recharge the aquifers on which they largely depend.
Lord Nugent of Guildford: My Lords, I thank my noble friend for that informative answer. Is he aware that the information that he has given about water levels in the southern region reflects the dangers for water supply next summer in that region, where rationing and shortages are already endemic? Is he aware that the southern region is particularly dependent on groundwater supplies, from which it obtains 80 per cent. of its water? That is more than in most other regions. Does he agree that the answer would be for Southern Water to build a couple of large storage reservoirs which would conserve some of the rainfall in order to supplement the groundwater supply? Does he also agree that that would provide an adequate overall supply for dry summers? Will the noble Lord advise the company that that is the action it should take with all expedition?
Lord Hesketh: My Lords, I am sure that all noble Lords are aware that my noble friend Lord Nugent knows far more about water supplies anywhere in the United Kingdom than this Minister ever will. He has made a very good point. I remind the House that some 10 years ago the proposed Broadoak reservoir outside Canterbury was turned down for planning reasons. As a result that reservoir was not built. It is also a fact that, due to its technical specifications, a reservoir is bound to be built in a valley, which is likely to be more scenically attractive than a flat plain. As my noble friend pointed out, if we are to have more reservoirs the local authorities and planning committees involved will have to give consideration to that aspect in the future.
Lord Stallard: My Lords, can the noble Lord tell the House whether there was an appeal against the planning decision in the case of the Canterbury reservoir?
Lord Hesketh: My Lords, I do not know whether there was an appeal or whether at the time the local authority felt that it was not worth appealing.
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However, that does not alter the difficulties of achieving a balance between the interests of those who support one use of the landscape and the requirements of those who supply water to people who live in the surrounding area.
Lord Tordoff: My Lords, is the noble Lord aware that most of the South-West of England has been turned into a reservoir in the past few days? Is there any way of updating the figures that the noble Lord has given the House to take account of the fact that since the beginning of January the country has had between 150 per cent. and 200 per cent. more rainfall than is normal for the month?
Lord Hesketh: My Lords, the noble Lord, Lord Tordoff, is entirely correct. My noble friend's Question referred to 1st January. However, in January in the South-East and the East rainfall was 150 per cent. of the average. For the first four days of this month the figure has been between 30 per cent. and 50 per cent. of the average for the whole of the month of February.
Baroness Phillips: My Lords, can the Minister give up-to-date information regarding the promise that was made in this House five years ago for a reservoir for South Wales? So far as I know, nothing has happened. Does the noble Lord have more up-to-date information?
Lord Hesketh: My Lords, I have to confess to the noble Baroness that I was not in your Lordships' House five years ago. However, I shall inquire about that Welsh reservoir and drop her a note on the subject.
Lord Morris: My Lords, is the Minister aware that the proposal for a reservoir to the north-east of Canterbury has been under consideration for more than 14 years? Will he use his best endeavours to ensure that the local authority gets its priorities right in that matter?
Lord Hesketh: My Lords, I believe that it is entirely proper that I should draw to the attention of the local authority the remarks that have been made in your Lordships' House today.
Lord Mellish: My Lords, does the Minister agree that reservoirs are the solution to the problem? People who live in southern England will be bewildered by the answer that he has just given. He said that we are still short of water. After all the rain that we have had in the past few weeks, people will never believe that. Reservoirs have been subject to local authority planning permission. Am I not right in saying that, if a local authority refuses planning permission, it is a matter for the Government to step in and decide? If that is so, why have the Government not done that?
Lord Hesketh: My Lords, in answer to the last part of the question of the noble Lord, Lord Mellish, we believe that local authorities should show initiative and ability in local government. However, I remind him that though he may decry the figures

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that I have given for the past month, we have suffered from a substantial drought for a considerable period of time. Last summer was the hottest summer since 1659.
Lord Stoddart of Swindon: My Lords, is the noble Lord aware that there has been gross over-pumping of underground water supplies over a long period of time, leading not only to the present water shortage but to damage to small rivers and the environment throughout the South-East? Is it not time that water authorities were encouraged to adopt a conservation policy and to stop the gross waste of water? Perhaps the Government can give some advice to the new water authorities as to the conservation of water, which is just as important as the conservation of energy.
Lord Hesketh: My Lords, it is fair to say that there are two responses that I can give. First, I am sure that the introduction of metering will make the consumer more aware of the level of consumption. I should point out to the House that since 1976 some £3·3 billion has been spent on improving the connection service and the inter-connection, to which attention was drawn after the last drought in 1976.
Lord Nugent of Guildford: My Lords, is my noble friend aware that the noble Lord, Lord Mellish, is perfectly right to say that adequate water comes from the skies and that we are well blessed in this country with more than we need, only using about 10 per cent. of what falls from the skies for supply? Management therefore depends on storing enough of the winter rains, either underground or in surface reservoirs, to ensure that we have sufficient for dry times in the summer. A couple more reservoirs are needed for the southern region to supplement the limited aquifer supplies.
Lord Hesketh: My Lords, I am not quite sure whether the law of the land is in favour of the imposition of building, but I must confirm that my noble friend Lord Nugent is absolutely correct. I can assure noble Lords that, when I attend the conference in San Diego next Sunday to address the matter of water, most of those attending the conference will be amazed that I have been asked to do so because they will not believe that I have anything to talk about which relates to the problems that they face in the south-western United States.
Lord Lloyd of Kilgerran: My Lords, I hesitate to intervene, but I do so merely to ask the noble Lord whether he will be good enough to duplicate the answer that he intends to give to the noble Baroness, Lady Phillips, about South Wales. Strange as it may seem, I am interested, inter alia, in water in Wales.
Lord Hesketh: My Lords, I shall certainly put a copy of the letter in the Library. I remind the noble Lord that Wales is even more blessed than the South-East of England when it comes to rainfall.
Lord McIntosh of Haringey: My Lords, does the Minister agree that adequacy of water requires not
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only adequate quantity but adequate quality? In the light of the revelations regarding the 1,300 landfill sites which may be damaging the aquifers in this country, will the Government say, first, what they propose to do to resurvey those landfill sites which have not been surveyed since 1974; and, secondly, whether they will do something to protect the quality of our water?
Lord Hesketh: My Lords, I am sure that the noble Lord, Lord McIntosh of Haringey, would not expect me to answer on pure speculation in a popular Sunday newspaper. However, I can assure him, as I often have to, that the privatisation of water has resulted in the UK having the only fully funded programme of some £17·5 billion.

Business
3.3 p.m.
Lord Denham: My Lords, it may be for the convenience of the House if I announce that the Committee stage of the Courts and Legal Services Bill will be adjourned at about 7 p.m. for about one hour—perhaps marginally longer on this occasion —and that during this adjournment the Report of the European Communities Committee on Irradiation of Foodstuffs will be debated.

Civil Aviation Authority (Borrowing Powers) Bill
Brought from the Commons; read a first time, and to be printed.

Business of the House: Debates, 7th and 21st February
The Lord Privy Seal (Lord Belstead): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the debates on the Motions in the names of the Lord Boardman and the Lord Williams of Elvel set down for 7th February and 21st February shall be limited to 5 hours and that Standing Order 35 and paragraphs 10 to 13 of the Rules for the Conduct of Short Debates shall apply to the debate with the substitution of "5 hours" for "2½ hours" and "25 minutes" for "20 minutes". —(Lord Belstead.)
On Question, Motion agreed to.

European Communities: Select Committee
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the Lord Nathan be appointed a member of the Select Comittees. —(The Chairman of Committees.)
On Question, Motion agreed to.

Capital Allowances Bill [H.L.]
The Lord Chancellor (Lord Mackay of Cashfern): My Lords, I understand that no amendments have been set down to this consolidation Bill and that no noble Lord has indicated a wish to move a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of recommitment be discharged.
Moved, That the order of recommitment be discharged. —(The Lord Chancellor.)
Lord Lloyd of Kilgerran: My Lords, I hesitate to intervene at this stage, but noble Lords will notice that the Capital Allowances Bill, which is of considerable significance, has been amended by the Joint Committee on Consolidation Bills. I was a member of that committee and initiated the amendment. The subject matter of the amendment was approved by committee members from the other House.
The mischief with which I sought to deal was the fact that, although the Income and Corporation Taxes Act 1988 referred to capital allowances for patents and, inter alia, other intellectual property matters, the consolidation Bill did not include any reference to that Act. I therefore felt —this point was received with great sympathy by other members of the committee —that a capital allowances Bill should indicate to practitioners the position of capital allowances in relation to intellectual property matters. I am sure that institutions such as the BBC are not particularly interested in capital allowances for intellectual property matters, but it is an important matter.
As a result of a compromise with the committee, it was decided to introduce on consolidation of the Bill an amendment, which is to be found on page 143 of the Bill, to Clause 161(11), which states:
"Chapter I of Part XIII of the principal Act"
the principal Act is defined on page 142 as the Income and Corporation Taxes Act 1988—
"(which relates to patents and know-how) contains further provisions relating to capital allowances".
I took the view that a practitioner dealing with patents in the field of industrial property would expect a capital allowances Act to contain some reference to the important subject of patents and know-how. Nevertheless, the committee said that that kind of compromise would be effective.
I take the view that, having incorporated the amendment in the Bill, the Title of the Bill should be amended. I must therefore draw the Government's attention to the fact that the Title of the Bill should include some reference to the fact that it includes capital allowances in relation to patents and know-how. It seems to me that that would be of great help to practitioners who deal with that important subject. The Prime Minister is a great supporter of the idea that intellectual property matters should be brought to the notice of industry. Practitioners —not merely members of large companies with plenty of money, but members of small companies —would expect a capital allowances Act to include some
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reference to the position relating to patents and know-how which are so important to industry today.
The Government may feel that they wish to consider the matter before the next stage of the Bill in order to bring forward an amendment to the Title of the Bill so that it may make some reference to the fact that capital allowances in relation to patents and know-how are dealt with in the Bill, rather than being simply hidden away in Clause 161(11) on page 143.
The Lord Chancellor: My Lords, the situation is that the Long Title of the Bill is:
"An Act to consolidate certain enactments relating to capital allowances".
In other words, the Bill does not profess to be an exhaustive consolidation of capital allowances. When capital allowances were gathered into the Capital Allowances Act 1968, the capital allowances relating to patents and know-how were left in the Income and Corporation Taxes Acts. The reason was that they are so intimately bound up with other provisions of those Acts that it is not possible to have a sensible separation. There would be a tremendous amount of duplication in the statute book if the provisions that are necessary in relation to capital allowances in that area were duplicated in the Income and Corporation Taxes Acts and again in capital allowances legislation.
The Long Title warns that these are only certain enactments relating to capital allowances. The joint consolidation committee, as the noble Lord pointed out, has in Clause 161 now put in a clear marker to where other enactments are to be found which deal with capital allowances. The joint committee took the view that this was the right way to do it and I hope that the noble Lord will be prepared to leave the matter there. If he wants to move an amendment in Committee, we shall have to have a Committee stage. It is of course up to him to decide.
However, the advice that I have been given from parliamentary counsel is that the Long Title of the Bill is correct as it stands and that the attention of practitioners is sufficiently directed to the other Act by the amendment to which he has referred. I am advised that that was the practice in the past. In that situation I hope that the noble Lord will feel able not to object to my Motion that the order of recommitment be discharged. It is, however, up to him.
Lord Lloyd of Kilgerran: My Lords, with the leave of the House I should like to comment on what the noble and learned Lord the Lord Chancellor said. His view is that to the practitioners in this important field of patents and know-how a reference to capital allowances, hidden away, if I may presume to say so, in Clause 161(11) is a clear indication to practitioners that they have to look into this Bill. I hesitate to differ from the noble and learned Lord the Lord Chancellor.
Despite the advice that the noble and learned Lord has received from his advisers, it seems to me that as a practical matter the Title of this Bill should be amended in order to include a reference to the fact

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that, although it refers to certain other Bills, the Capital Allowances Bill certainly includes a reference to the capital allowances to be afforded on patents and know-how matters.
The Lord Chancellor: My Lords, if the noble Lord wishes to move an amendment to the Long Title, we shall have to have a Committee stage. I take it that the noble Lord has objected. Therefore the House must resolve itself into a Committee on the Bill. I beg to move.
Moved, That the House do now resolve itself into Committee. —(The Lord Chancellor.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clauses 1 to 165 agreed to.
Schedules 1 and 2 agreed to.
In the Title:
On Question, Whether the Title shall be the Title to the Bill?
Lord Lloyd of Kilgerran: I am not acquainted with the full procedure for dealing with this matter. Certainly I have not yet tabled an amendment. I only obtained this Bill this morning. However, my amendment to the Title would be to include the words:
("and to consolidate certain enactments relating to capital allowances including capital allowances in relation to patents and know-how.").
I am not sure whether by merely putting forward orally this amendment I am using the correct procedure. However, that is the amendment that I would have put down had I had time to consider the matter further.
Lord Hailsham of Saint Marylebone: I seek leave of the Committee to ask where we now stand. I believe that. at Committee stage, especially when we are dealing with something so abstruse as the Long Title of the Bill, we ought either to have a written amendment before us or a Motion set down on the Order Paper, and preferably the latter. I should have thought that a purely oral amendment would be out of order whatever the situation may be.
Lord Lloyd of Kilgerran: I entirely agree with the noble and learned Lord. It may be that this is a matter that should be considered at the Report stage of the Bill.
Lord Belstead: In the circumstances, I think we have reached the point at which the noble Lord will be in a position to vote against the Long Title of the Bill but, as he has not produced a manuscript amendment, there is no amendment before the Committee.
On Question, Title agreed to.
House resumed: Bill reported without amendment.

Pakistan Bill [H.L.]
Lord Brabazon of Tara: My Lords, I understand that no amendments have been set down to this Bill and that no noble Lord has indicated a wish to move a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of commitment be discharged.
Moved, That the order of commitment be discharged. —(Lord Brabazon of Tara.)
On Question, Motion agreed to.

Courts and Legal Services Bill [H.L.]
3.17 p.m.
The Lord Chancellor: My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee. —(The Lord Chancellor.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 44 [Conditional fee agreements]:
Lord Hacking Lord Hacking moved Amendment No. 187:
Page 35, line 12, leave out ("and").
The noble Lord said: If it is convenient to the Committee I should like also to address it on Amendments Nos. 188 and 191. In our deliberations on this Bill we have now reached the stage of considering the proposed conditional fee arrangements. Those are the proposals made by the noble and learned Lord which arise out of his Green Paper on contingency fees. In moving this amendment I seek neither to advocate nor speak against the new proposed conditional fee agreements.
My amendments are directed to two smaller but nonetheless important points. The first point is that, if there are to be conditional fee agreements, they should be set out in writing. Secondly, that the noble and learned Lord should identify the essential ingredients of that statement in writing to the client.
It is already good practice, when entering into an agreement to act for a client, to set out the terms of that agreement, especially the terms concerning the fee arrangements. Under the new proposed conditional fee agreements there are added more important reasons why that agreement should be set out in writing.
With regard to the essential information that the agreement in writing should contain, when a client is being invited to consider the conditional fee agreement, in my submission it is important that he should be fully aware of alternative means of funding the legal services that are being provided to him. The nature of the conditional fee agreements makes it most important that the client understands the full consequences of entering into such an agreement.
Without either advocating or speaking against these new proposed arrangements, for the reasons that I have put before the Committee, I beg to move the amendment standing in my name.
Lord Campbell of Alloway: As the Committee knows, I am committed to resist conditional fee agreements. However, if we are to have them —I hope that we shall not —surely we must support these amendments. We are considering a person providing advocacy or litigation services. There ought to be some unified regime under which this conditional service is rendered which would govern barristers, solicitors and the authorised bodies, albeit in consultation with all those bodies. There ought to be some unified system so that there is fair competition between all those providing the services.
On that basis I support the amendments, and in particular Amendments Nos. 188 and 191. However, I hope that the Committee will not accept conditional fee agreements.
Lord Hailsham of Saint Marylebone: I take the same view about the merits of Clause 44 as my noble friend. But it is surely not enough for the amendments that are proposed simply to be contained in a conditional fee amendment. Surely the other side should know what has been agreed between the client and his own adviser or advocate. The other side may have to pay in certain circumstances and therefore has an essential interest in such an agreement. The court should surely be told in writing what has been agreed before the proceedings are started, because in the end the court will have to tax the successful party's costs. The agreement may have been altered during the course of the proceedings to the disadvantage of the losing party.
Lord Hacking: Will the noble and learned Lord allow me to intervene? That point is covered in subsection (8). For the purpose of taxation, other parties in the litigation will not be required to make any additional payment over the standard costs in the case of a conditional fee arrangement.
Lord Hailsham of Saint Marylebone: All the same, one ought to know in advance exactly where one stands when one is dealing with contested litigation. It ought to be registered in some form so that people know the contents of the arrangement at the time when it is arrived at. Otherwise it is very much in the air.
The Lord Chancellor: On these amendments there is a good deal to be said for the views that the noble Lord, Lord Hacking, has put before the Committee. I have felt on balance that, since the risk of uncertainty would fall on the lawyer making the agreement, it would be highly likely that he would normally protect himself by reducing the agreement to writing. However, in view of the fact that the noble Lord has put the matter forward, I am very happy to consider it further. So far as I can see, there is little difficulty. If the noble Lord will allow me, therefore, I should like to consider the matter.
Lord Hacking: Unless other Members of the Committee wish to speak to my amendment, I beg leave to withdraw it.
Amendment, by leave, withdrawn.
[Amendment No. 188 not moved.]
Lord Allen of Abbeydale Lord Allen of Abbeydale moved Amendment No. 189:
Page 35, line 18, after ("by") insert (", or as the case may be, the calculation by reference to").
The noble Lord said: I should like to speak also to Amendments Nos. 190, 192, 193 and 194. I do not wish to pre-empt the discussion on clause stand part, but for the purpose of these amendments I am bound to make the point that, however generous legal aid may be, there will always be a gap between those who qualify for legal aid and those rich enough to enter into legal proceedings without a qualm. I think it most desirable, in order to help in a modest way towards filling that gap, that there should be on the statute book provisions which enable conditional fee arrangements to be made in a way that avoids the problems raised by the American arrangements. It is one way in which access to justice can be improved.
In these amendments, I am suggesting rather tentatively that, if powers are taken to introduce some form of contingency fees, the opportunity should be taken to widen those powers a little. The scheme can then be expanded if experience shows that that would be useful in order to take account of the possiblity of other methods of calculating the fees to be paid going beyond a percentage of the lawyer's fees.
If I dare say so, it might, for example, be thought desirable to provide that lawyers may be additionally remunerated by taking, in prescribed cases, a prescribed proportion of the sums recovered by way of damages. The noble and learned Lord the Lord Chancellor might perhaps appoint a committee of lawyers, laymen and representatives of consumer interests to advise on the permissible means of calculation.
I fully realise that the powers in the clause as it stands would be unlikely to be used on a great scale in the early days. I am not suggesting that there would be any question of using the additional powers for some time to come. However, it seems rather a pity that it would be necessary to come back for further legislation if experience showed the need for some development of the original concept.
I am certainly not wedded to the drafting of my amendments. I put them forward as a possible means of permitting flexibility and subscribing to what the noble and learned Lord described on an earlier occasion as "evolutionary change". I beg to move.
Lord Campbell of Alloway: Perhaps I may ask the noble Lord a simple question. Can these appropriate means of calculation in his concept bear any relationship to the damages recovered? Is so, that would indeed be a serious derogation for the concept of Clause 44 as it stands.
Lord Allen of Abbeydale: I thought I had explained that that is one possibility that could be envisaged

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in the future, not on the American model but only under strict prescription as to the proportion and type of case in which it might be possible.
Lord Campbell of Alloway: I thank the noble Lord. I hope that the Committee will not accept the amendment in any circumstances. It opens the door to an even greater objection than the objection that already arises to Clause 44 as it stands.
Lord Mishcon: I urge the Committee to exercise the caution that should undoubtedly be exercised when dealing with the question of lawyers' costs, conditional fees and contingency fees. I appear to have caused some merriment. I am talking about a very serious subject and one that affects the public very greatly.
There is not the slightest doubt that when legislation opens a door very slightly there is the danger of future legislation opening it still wider. If the Committee accepts the view that there can be conditional fees limited in the way that has been indicated in the Bill, I hope —and I am speaking personally —that the matter will end there. To walk into the possibility of the American model of contingency fees is asking for trouble for the public and the profession.
I should like to give the Committee an example of what could easily happen. Let us suppose that you have a personal injury case. You are covered in regard to your fees only if there is a recovery of damages in which you, the lawyer, participated. You are saved a great deal of trouble by the defendant insurance company offering a sum almost at the beginning of the case which, if you are thinking objectively and endeavouring to advise your client so, you believe may well be too small. However, as the lawyer —and here lies the conflict of interest —you face the possibility of a long trial with very much work at the end of which you may receive nothing. Yet here is a prospect of your walking away with a percentage of what has been offered by the insurance company as against having to do all that work and run all that risk. Is that what Members of the Committee would like the legal profession to be driven into?
I have one fear which I shall mention again later in Committee. I hope that even with the conditional fee there will be no question of a legal aid board saying to the client, "You will not receive legal aid because this is a case where you might find a solicitor who will do it on the conditional fee basis". Obviously, that would be a very wrong way in which to deal with legal aid.
Therefore, as I said when I commenced my remarks, the whole question of the regulation of lawyers' fees, within proper professional ambits and with a due regard to the way in which an honourable profession is supposed to behave, is a matter of serious concern to the Committee. I hope that, if we are to have the conditional fee, we shall not embark upon anything further; nor shall we give anyone the power to make recommendations or decisions which will further that conditional fee into areas which are extremely unhealthy.
3.30 p.m.
Lord Hailsham of Saint Marylebone: I too hold the gravest doubts about what I can describe only as an extension of the proposals in a clause which I regard as inherently immoral. Where are we going if it is not in the American direction? We know what the American direction is. In the Green Paper we were promised that we would not follow that path and now we are invited to follow it up to a point. I am not at all sure what the point is because I was not wholly able to understand the amendment when I saw it in print nor when I heard it advocated orally by the noble Lord, Lord Allen of Abbeydale.
I do not wish to compromise the debate which will surely follow on the desirability of the principle of Clause 44, and therefore at this stage I make only the following comment. Damages are intended to compensate the plaintiff who has been wronged. That is the principle which is followed. However, in America a successful litigant —whether plaintiff or defendant —virtually does not receive his costs. He does not receive what we would call his "costs".
In recent years —and such a case took place during my second term of Chancellorship —not only have we not gone down the American path but we have destroyed the old basis of party and party costs, which at best gave one about two-thirds of what one had spent, and have awarded costs which more approximately represent what one has actually spent. That was done on the common fund basis which has now become the standard basis. Beyond that, one has solicitor and own client, indemnity costs and so forth. We have gone down the opposite road in order to compensate the plaintiff for what he has suffered, if he has suffered any wrong, and also to say that the unsuccessful defendant should pay the costs of maintaining the case at the cost of the legal proceedings.
It is as well to look at the situation in America. It has the civil jury, which accentuates all the evils which the contingency fee system may or may not involve. The civil jury aims off for the contingency fee. Therefore, it awards against the unsuccessful defendant a sum approximately twice that to which he is entitled by way of compensation. Thus the American civil jury substitutes for our scientifically balanced system of costs an excessive award of damages. It may be that in some fields civil juries in this country do that but for different reasons. However, we shall not go into that matter today.
After two world wars, and stage by stage, we have gradually moved towards a judge-alone system. We have done so to great advantage, in my opinion, though against the natural conservatism of my profession. However, even if we retain that system —particularly in cases of personal injury —it is my experience that if you scratch a judge you find a civil jury underneath, though not quite to the same extent as a civil jury of 12. Perhaps when you scratch a judge you get one-twelfth of a civil jury. In other words, you are introducing the same evil because the judge too will aim off.
Baroness Phillips: I understand that the Committee will debate the Question, That the clause

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stand part. However, I hasten to intervene in order to remind Members that one of the reasons why I, among many clients, welcomed the Bill —the word "consumers" does not appear to be favoured —was because it would enable 80 per cent. of the population who neither qualify for legal aid nor are rich enough to contemplate action to enjoy the due processes of law.
I am touched by the vision of a profession which does not work for money. I am deeply touched by that. Nobody would suggest that its members would automatically force up costs in order to obtain more, so why should they be in a position where they are not properly rewarded? I believe that the whole issue has been confused. I originally understood that the clause was intended to enable more people to obtain the benefit of the operation of law which exists for them.
All Members of the Committee know many people who will not go to law when they have a good case simply because they are frightened of the final amount and that they may not gain anything. In other words, it is the old question; "Why throw good money after bad?".
The Lord Chancellor: I too am anxious not to pre-empt the main debate on clause stand part. However, in the light of the consultation which we held on this matter, I concluded that the correct principle was that the legal profession should be able to take on conditional fee arrangements—conditional on the success of the case but also conditional on the principle that the remuneration should be related to the work done.
That is what my proposal means; namely, that the only basis for remuneration will be the taxed costs awarded against the other side. In other words, it will make no difference as regards the other side whether, for example, the plaintiff is funded in that way or funded out of his own pocket. The actual price or payment which the other side must make if it loses is the sum of any damages awarded plus the taxed costs. It is those taxed costs plus, if necessary, a percentage uplift which would be permissible but nothing based on the award of damages.
The reason that I did not do that is that there is nothing at all necessarily connecting the size of the award of damages with the amount of work done. For example, there could be a huge award of damages to a paraplegic where liability was admitted and the amount of work done by the lawyer was very small indeed. That seems to me to be wrong in principle. As my noble and learned friend Lord Hailsham pointed out, we have a system available to us which is quite different from the American system because that does not have an award of costs, for example, to a successful plaintiff against a defendant. Therefore the sort of arrangement which I propose is not open there.
However, I do not believe that it would be wise to go for anything more than that which we have proposed. Therefore, although I understand what has motivated the noble Lord, Lord Allen of Abbeydale, to suggest this, I feel that the principle
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upon which I have stood is sound, subject to what we shall hear later, and that it would be wrong to go to anything which would allow professional remuneration to be related to the award of damages. It might be related underneath the percentage but not in the way suggested.
Lord Allen of Abbeydale: As I explained at the beginning, I put forward this proposal rather tentatively. It gave rise to an interesting discussion in which the lawyers who contributed to the debate ran very much according to form and said precisely what I expected them to say.
It looks rather different when one is a consumer and cannot get legal aid and I go along with the earlier comments of the noble Baroness. However, I take the explanation which the noble and learned Lord has given. I have an uncomfortable feeling that in a few years' time, when, as I hope, this clause will have survived and will have been put into operation, we may seek fresh legislation. However, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 191 to 194 not moved.]
3.45 p.m.
On Question, Whether Clause 44 shall stand part of the Bill?
Lord Rawlinson of Ewell: I rise to oppose the Question whether Clause 44 shall stand part of this Bill. This clause deals with the proposed conditional fee arrangement. I should have thought that even commentators who had been seduced by a belief that this Bill is one of reform to introduce cheaper and better access to justice would hesitate over this clause giving for the first time, as has already been indicated, advocates a direct financial interest in the result of a case.
I have no doubt that as the noble Lord, Lord Allen of Abbeydale, clearly indicated in his last comment, if this clause and practice are permitted cases will develop into speculative litigation, some of which can amount at times to blackmailing action. Eventually, our jurisdiction will join that of the jurisdiction referred to, of which this is its worst feature.
The old system, the present system, is that the advocate must have a fee marked on his brief. There is no financial consequence to him arising from the result of the case. He does not have his brief marked when he appears for the Crown because those fees are laid down on a specific scale. Traditionally in this country an advocate has always been regarded as an officer of the court, as is a solicitor. He has a duty to the court and must have and must give that detachment. The fact that he has no financial interest in what happens to the case and the amount of damages to be awarded gives him that strength of detachment to enable him the better to exercise his duty.
It may be said that this Bill permits those with reduced means to have access to the courts. Forty years ago, at the time of a Labour administration, it was decided —and it has been maintained ever since —that that problem should be resolved by the

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provision of legal aid. If you will the purpose, you must will the means. What has fallen badly away from the principle of those days and subsequent days is the proper funding of legal aid. That is the most serious of all the matters which face the consumer or customer at present. I fear that by this provision the Government give the impression of seeking some alternative —a demeaning alternative —to properly funding legal aid.
Perhaps I may indicate some of the mischief of which I had experience at the libel Bar and to which I referred on Second Reading. One held retainers for newspaper groups and one could see, even under the present system, that there were sufficient threats to bring actions for libel against newspapers which were of no merit whatever but which would cost the newspaper so much that it would do better to pay up and pay off the plaintiff in order to send him away.
Under the new system, if this clause is accepted, there will be a vast increase of that sort of mischief. We have seen the level of damages which juries have awarded. Was not £1.5 million awarded in damages to a noble Lord? If we develop into the American system some 40 to 50 per cent. of those damages will go into the lawyers' pockets —in the case I mentioned some three-quarters of a million pounds. That must encourage speculative action. The financial reserves of the newspapers had better be greatly increased if we start that process by introducing this clause.
That is the worst feature of the United States system, which has been referred to by my noble and learned friend Lord Hailsham. We have seen that. There is the ambulance chasing at the natural disaster or plane crash. We saw that that happened when there was that chemical leak in India. The American lawyers on the scene made offers to relatives of the injured saying that there would be no fee if there was no win. Those lawyers received 20, 30 or 40 per cent. of the damages. Members of the profession to which I am proud to belong acted like vultures. That all derives from the fact that if you give the lawyer a financial connection with the result or if you introduce this market philosophy into the administration of justice, not only is an economic principle being distorted with which many of us agree but the principle will be damaged if it is introduced into the field of justice.
I cannot recollect the statistic exactly, but about 80 to 85 per cent. of all actions in the civil courts are settled before they come near a court. What will happen in the circumstances of a conditional fee, with no fee no win? Will more actions be settled or fewer actions settled?
It is, therefore, something in which this Committee, which has looked so carefully at so many clauses of the Bill, must surely unite in saying to my noble and learned friend, "Increase legal aid if you want to give people more access, as you ought to do, but we beg you not to introduce this, the first step along a path which will lead to a very sad day for the administration of justice in the United Kingdom".
Lord Ackner: It was 11 years ago that the Royal Commission on Legal Services, under the
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distinguished chairmanship of my noble friend Lord Benson, considered and reported against contingency fees. It was seven years ago that the Government, in the White Paper devoted to dealing with the recommendations of that Royal Commission, accepted that recommendation. We are entitled to inquire: what has happened since to justify the proposed volte-face?
It will be said that the Civil Justice Review committee has sat and reported. I in no way criticise that review body. It was presided over by laymen. It had a majority of laymen on it and they very responsibly considered the pros and cons of this suggestion. It ended by saying that the review has not been able to make a full study of the matter and suggested its re-examination.
That was followed by a Green Paper devoted wholly and solely to this subject. That provoked the no doubt uncharitable view that the Government are attaching such importance to this subject that it will act as a smokescreen and produce the answer, when more legal aid is sought, "But you do not need to extend legal aid; go and ask the solicitor to take on a speculative action. If you have such a good case he will be delighted to do so".
The Green Paper drew attention to what occurs in Scotland, but it gave remarkably little detail. It did not give us a breakdown of the type of case; the nature of the risk run; the number of refusals that arose; the number of cases settled or the terms of settlement, or the type of advocate who took the case. I therefore took the great liberty when I had the privilege of meeting the then Dean of the Faculty of Advocates, Mr. David Hope, Q.C. —now the Lord President of Scotland —to ask him about his experience. He said that the figure of 1 per cent., to which reference has been made, was conjured out of the air because there were no statistics at all on this subject. It was merely an indication of how little use was made of the possibility.
I then asked in what circumstances, generally speaking, it was resorted to. He said that very occasionally a solicitor will go to a barrister whom he is used to briefing and say "I have a personal injury case. Time is running out to such an extent for the issue of proceedings that I will not be able to get the decision of the Legal Aid Advisory Committee before I must issue the writ and statement of claim. Will you be kind enough, therefore, to agree, without fee, to settling the writ and statement of claim and I will come back to you when I know what has happened with the Legal Aid Advisory Committee?" The barrister almost always agrees to do so. The solicitor returns and says "That is fine, we have legal aid", or he may say "No legal aid. They did not think it was a sufficiently strong case". The case is then either dropped or settled. In a great rarity of cases it may go on because the barrister and the solicitor do not share the view of the Legal Aid Advisory Committee. One might have expected the Committee to have been given a little of this detail, but not so far.
The other thing the Committee might have expected when the Civil Justice Review suggests a re-examination is that the Government would turn to the Law Commission, which is both wholly

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responsible and wholly independent, and ask for its views. There was plenty of time to do so. The Civil Justice Review committee reported about 18 months ago and there was time to get its views. They were not concerted. This stimulated the Law Commission, which thought the proposal a thoroughly bad one, to produce a report of about 33 pages, to some of which I shall refer.
That report was provided to the Government after the Green Paper but before the issue of the White Paper. One might perhaps have thought that it would be referred to in the White Paper; not a bit of it. All one finds in the White Paper regarding reactions —I read from page 47 —is this:
"There were over 500 responses on this topic. The majority of respondents (60 per cent.) were again solicitors. There was little support for a full contingency fee system. Many saw a more limited option as being ineffective unless the costs rules were changed. There was some support for legalising speculative actions, although it was again stressed that their use would be minimal".
It is that, apparently, which has justified the Government proposing what has throughout the years been condemned. In my speech on the Second Reading I describe the paper by the Law Commission as treating the Government's approach to this worrying subject as "shallow" and "superficial". I will make that good by a number of references from the paper itself. The Green Paper states that in 1979 the Royal Commission on Legal Services considered the question whether contingency fees should be permitted. It was overwhelmingly against it. It consulted widely with the public and the professions. It received an overwhelming weight of evidence opposed to it. The Green Paper then suggests that the rule which prohibits a legal adviser from acting for his client on the basis that he will receive a fee if successful but none in the event of failure, is a restrictive practice which is "feudal" in origin and which may operate against the public interest.
The Law Commission holds the view that in truth the rule is one imposed by the law with two principal aims: (a) to prevent the exploitation of litigants, and (b) to promote the interests of justice.
The commission further states that to suggest that to legalise contingency fees would amount to no more than "deregulation" —that is a quotation from the Green Paper —seems to betray a misunderstanding of the origin, nature and purpose which have led the courts to impose the rule. Of course it is right that public policy should be reviewed in the light of changing social conditions. If it becomes clear that such conditions have altered the public interest, the reasons which support the rule should be weighed against the changes. However, the commission would suggest a more rational approach is required to the question of reform than one based on the assertion that because the rule is a restriction, the onus is on those who support the status quo.
I make one or two further references. The report is now dealing with the need for rules if you bring in this radical change. It says:
"Traditionally in the solicitor-client relationship it is the client's interests that dictate the actions of his solicitor whose duty it is to consult his client's wishes and take his instructions throughout
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the litigation. It is obvious upon reflection that a solicitor who is investing his own resources to support the client's litigation cannot be required to act on the client's instructions to the same unqualified extent. To take one simple example, after the solicitor has invested a substantial sum in the conduct of the case, it may become apparent that the chances of success are considerably less than they appeared when the client first instructed the solicitor. The solicitor may be unwilling because of his assessment of the chances of failure to invest greater resources. The client, on the other hand, may want to pursue the action. It will be necessary to develop new ethical rules to meet a situation such as this.
The commission quotes from the observations of Professor Caughey in the University of Chicago Law Report 1987, where he says in regard to contingency fees:
"It is more accurate to describe the plaintiff's attorney as an independent entrepreneur than an agent for his client".
The only other references I wish to make are these. The Law Commission points out that that will have the effect of increasing actions against professional persons. My noble and learned friend Lord Hailsham referred to the press as being the subject of blackmailing actions. I am far more concerned, because the press is capable of looking after itself —
Lord Hailsham of Saint Marylebone: More or less!
Lord Ackner: —with the individual professional man. The Law Commission says, that there will be an increase in medical malpractice cases. The official referees, in their submission to the Lord Chancellor on the Green Paper, make the point stronger. Members of the Committee will recall from previous debates that the official referees deal with building and construction dispute cases. They say:
"We think that architects, engineers and surveyors, also doctors and other professionals, could be particularly vulnerable to claims brought or threatened on a contingency basis. The damages recoverable in most construction cases would make receiving a proportion of them attractive, while for the professional even to report the claim to his insurers will probably result in an increase in his next premium. In consequence, however strong the professional's case, he might think it expedient to make a `nuisance payment' if the professional goes to his insurers and the action shows signs of being fully contested, with large costs involved, a speculative solicitor can always advise his client to discontinue."
4 p.m.
Lord Mishcon: I have waited until the noble and learned Lord finished an argument. I would not wish to be in any way confused, but so far he has spoken about contingency fees which many of us recognise as being an evil. Is not this clause directed to the conditional fees and not contingency fees?
Lord Ackner: We are talking about words. This clause is devoted to the solicitor obtaining his remuneration plus an uplift on the contingency that his client succeeds. That is a species of contingency fee; it was so described in the Green Paper and so dealt with by the Law Commission. I am fully aware of what the noble Lord has in mind, and that is a percentage of damages. I am not dealing with that.
Finally, I invite the attention of the Committee to what the Law Commission finally advised:
"The commission believes that greater research and more thought is necessary before it can be concluded that the introduction of a contingency fee would in fact significantly

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increase access to justice in this country especially since many of the cases which in the United States makes use of the contingency fee system are catered for by our own legal aid system."
Secondly,
"Codes of practice and rules of conduct have not proved an adequate protection for litigants or apparently for the interests of justice in the United States."
Thirdly,
"To require the litigant to pay any significant sum out of his damages does of course detract from the fundamental principle of English law that the courts strive to put a wronged person back into the position he would have been had he not been wronged. One writer has said: 'Any time a litigant has to pay representation expenses from his award justice is not done' ".
It therefore concludes that far too little time, too little thought, and an excessively superficial approach have been allocated to this very difficult subject, and it is for that reason that I suggest that the Government should think again.
Lord Renton: When my noble and learned friend the Lord Chancellor has heard all the arguments in this debate, I hope that he will feel the wise course will be not to keep this clause in the Bill. I join with the noble Lord, Lord Mishcon, in making clear that we are not discussing the type of contingency fee which involves taking a share of the damages if one is acting for the successful party. We are discussing a matter which is not very far removed from it; namely, a conditional fee agreement under which, in accordance with the clause, the solicitor and barrister, or the solicitor and advocate, acting for the lay client, will only be paid if they win the case. I suppose, as a slight compensation for the risk, they will be paid a higher percentage of fees than normal for a case of that type and for the issue involved.
Let us consider the reality of the matter. If the lay client loses his case, he will still have to pay the costs awarded against him including the fees of his opponent's counsel and solicitor though he will not have to pay his own counsel and solicitor. That is the first and most obvious factor. If the lay client wins his case, and if his opponent does not possess the means to pay the costs awarded against him, the successful lay client, as a result of the conditional fee agreement, will have to pay his own counsel and solicitor more than if there had been no such agreement.
I make no apology for mentioning the matter again and adding some further factors. This measure is a poor substitute for improved legal aid. On this occasion it is a question of cost to the Treasury. Under the Bill there will have to be a good deal of public money spent on setting up various new bodies; namely, the advisory committee, the ombudsman for conveyancing services and the conveyancing appeal tribunal. But it goes without saying that, marginally to some extent, the Lord Chancellor's Department and the Director General of Fair Trading must have more officials. That will mean more cost. In the financial memorandum to the Bill it is pointed out that these new bodies will cost several million pounds. Altogether, between £5 million and £7 million will have to be spent in the first year, and more than that in later years when the system is underway. I suggest that the money would be much better spent on legal aid than on this poor substitute for it.
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One difficulty has not so far been mentioned. When we discussed the cab rank rule last week my noble and learned friend said that he was in favour of it in principle. He had previously called it an important constitutional principle. I suggest that what is proposed in Clause 44 is inconsistent with that principle. I shall give two examples. The first is the barrister who says to his client, I am sorry, I won't enter into a conditional fee agreement because I consider that conditional fee agreements are wrong in principle". Most barristers already feel that that is so. He would then have to refuse the case, and it would be against the cab rank rule for him to do so.
My second example concerns the fairly young married solicitor or barrister with several growing children and no private means of his own. He decides to take one of these cases which lasts a long time. If a request is made to him to take another case with a conditional fee agreement which might also take a long time he would have to refuse. He could not afford to carry on taking difficult and longish cases without payment. That is another example of where he would have to disobey the cab rank rule.
This is a serious matter. Anxiety is felt in many quarters, and not only in the legal profession. I have heard other people say that they do not think it is right to try to solve the present difficulties of our system in this way. I most earnestly support those who say that Clause 44 should not stand part of the Bill.
4.15 p.m.
Lord Peyton of Yeovil: I lack the learning of other noble Lords who have taken part in the debate and so perhaps I may be forgiven if I ask a very simple and straightforward question. How many of us are really convinced that it would be right to make three distinct moves in the direction of the American system, and what gains would result from our doing so? First, it is proposed that we move towards the amalgamation of the two professions. Secondly, we are making substantial moves in the direction of setting up, in fact if not in name, a Department of Justice. Thirdly —this is the point with which we are here concerned —we are for the first time giving the advocate a pecuniary interest in the outcome of the case.
In those circumstances I feel that it is a measure of the very great esteem in which my noble and learned friend the Lord Chancellor is held that the Bill has had, relatively speaking, so smooth a passage. I speak with the utmost respect for my noble and learned friend when I say that in my anxieties I very much sought comfort from his words. Far from being allayed, my anxieties were however increased by words which he used. I hope the Committee will forgive me if I quote briefly from the Second Reading debate. My noble and learned friend said:
"I do not put myself forward as a prophet. I believe that if the proposals are rational and well based, and if we have set up a decent machinery for handling them, the results are likely to be beneficial. The machinery is capable of evolutionary change. I believe that we shall be able to proceed in an evolutionary way and to judge the results to some extent as we go along". —[Official Report, 19/12/89; col. 248.].

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I derive no comfort from those words. My considerable anxieties about the three basic changes proposed in this legislation, far from being allayed, are sharper than they ever were. I very much hope that my noble and learned friend will have second thoughts about this clause as well as, perhaps, about some of the other matters that I have mentioned.
Lord Rippon of Hexham: I intervene briefly to refer more specifically to the clause itself. I appreciate that the purpose of the clause as it stands is restrictive. But apart from the reference of my noble friend Lord Peyton of Yeovil to the evolutionary process to which my noble and learned friend the Lord Chancellor referred at Second Reading, we have to consider the intervention this afternoon of the noble Lord, Lord Allen of Abbeydale. He quite clearly indicated that he hoped that this would be the thin end of the wedge leading to a form of future legislation which might be closer to the American system. The American system would at least have this disadvantage. It would be perfectly clear from the outset what the basis of the fee would be. If, for example, the lawyers appearing for The Sunday Times had agreed to accept 10 per cent. of the 60p damages, that might have been regarded as the best joke of all. As it is, it is not clear how the payments are to be made.
In Clause 44 everything really depends on orders to be made by the Lord Chancellor. Subsection (4) says:
"In this section "specified proceedings" means proceedings of a description specified by order made by the Lord Chancellor for the purposes of subsection (3)".
Subsection (5) provides:
"The Lord Chancellor may by order prescribe such maximum permitted percentages for specified proceedings as he considers appropriate".
Subsection (10) states:
"The proceedings mentioned in subsection (1)(a) are any criminal proceedings and any proceedings under".
There is then a list of possible proceedings, and then of course it is said at the end in subsection (11):
"The Lord Chancellor may at any time by order amend subsection (10) by adding or removing descriptions of proceedings".
So there is nothing certain in the clause.
Sir Harold Kent, who was first parliamentary counsel and then Treasury solicitor, says in his memoirs that when he was a young man he drafted a clause for which he was much praised by a senior civil servant —someone perhaps as senior as the noble Lord, Lord Allen of Abbeydale —who said, "Well done, my boy; nice and vague". And that is what this clause is.
Finally, I ask my noble and learned friend the Lord Chancellor whether he has yet studied the 39th annual report of the Law Society and the Lord Chancellor's Advisory Committee. It was only ordered to be printed by the other place on 1st February. It may be of interest to those who do not think that lawyers ever speak for anyone but themselves. The relevant paragraphs are 74 to 77. The committee says:
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"This Committee has always opposed, on the grounds of conflict of interest, the introduction of contingency fees whereby a lawyer is paid only if the client's case is won, with payment fixed by reference to a percentage or share of the award that is made".
I believe that most of us are opposed to that idea.
The committee continues:
"We are therefore pleased to note that the Government has rejected any type of fee involving a proportion of whatever damages are obtained. We remain somewhat apprehensive, however, regarding the proposal to allow conditional fees with a percentage addition to the normal costs".
The committee asks that it should be ensured that any such uplift is unlikely to impair impartiality in the conduct of a case —a point made by the noble Lord, Lord Mishcon.
The report continues:
"Nonetheless, we believe that such conditional arrangements might occasionally prove helpful in cases where legal aid is not available … On the other hand, we doubt whether any such arrangements will have any major impact on financing litigation, first because lawyers will only be prepared to undertake cases on such a basis if they are reasonably certain of success, and secondly because of the disincentive effect of the costs rule".
In other words, the Legal Aid Committee, which advises the Lord Chancellor, sees little merit in the proposal. It points to two considerations which it finds especially relevant. The first is to ensure that conditional fees are seen as a supplement to legal aid and not as an alternative; and, secondly, it says that it is also concerned to ensure that the availability of conditional fees is not perceived as a reason for not maintaining legal aid eligibility levels, and for not extending legal aid to those areas where it is presently unavailable. The committee concludes:
"We do not regard the arrangements for conditional fees as a realistic alternative to legal aid … We think that it is important that the Government should ensure that there will be no loss of service to the poorer client before any of the proposals are actually implemented".
I suggest to those of the Committee who think that this is merely a legal argument that they bear in mind the views of the Legal Aid Committee, which clearly does not support the clause, and certainly not as at present drafted.
Lord Mishcon: Perhaps I may —
4.30 p.m.
Lord Hailsham of Saint Marylebone: I should willingly defer to the noble Lord, Lord Mishcon, but he has kindly deferred to me, which was wrong of him, if he will allow me to say so. I want to speak with as much studied moderation as I am capable of. I wish, however, to say that I seldom seek to talk in this place about morals; but I regard this as a straightforward moral issue. I believe a conditional fee of the type proposed, which is only one example of the contingency fee, although not the worst, to be inherently immoral. It undermines the whole ethic of advocacy, the whole ethic of the legal profession.
I have been for most of my life a barrister when I was not in office or in the army. I was the son of a barrister. I am the father of two barristers, one of whom is still in practice. This provision goes against everything that I was taught. It is against everything that I have practised. It is against everything that I have tried to teach my children. An advocate owes

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three distinct moral duties. His first, and I believe his overriding, moral duty is to the court. His second, and his next most important, is to his client. The third, and it is important, is to his opponent.
The conditional fee, whether in the form proposed or in any other form, undermines all three of those duties because it gives the advocate a direct financial interest in the result of his case. The only defence which the Government put forward in their Green Paper is that they trust the honour of the profession. I am sorry not to see any bishops in their place, but I am afraid that I take a theologically different view from that of my noble and learned friend. He apparently believes in justification by faith alone. He will remember of course that a namesake of mine, the "Ettrick Shepherd" James Hogg, wrote a book entitled Confessions of a Justified Sinner in which the man ended by killing his own brother. I believe that if there is one doctrine of the Christian church which can be proved by experience it is the doctrine of original sin. If we make it pay to be dishonest, people will become dishonest even if they start by being honest. That is what this proposal will do.
The duty to the court is never to deceive the court, never to misrepresent the evidence, and even to bring forward legal decisions on a point of law which are hostile to the case that one is seeking to argue. One's interest of course is to do all three if a conditional fee is allowed. One's duty to one's client is to promote his interests. Let us suppose that one receives an offer of a settlement —I wish to return to settlements because they may be important in this connection —but one can earn a little more money, if the defendant is going to pay out something, by asking for two or three more sets of particulars and so prolong the case a little longer and run up one's bill. One is then making more money. The client's interests may be totally different. As regards one's opponent, one's object is not even to take advantage of an inadvertent mistake. All those factors are contrary to the conditional fee.
In what I thought was a rather simplistic speech O sancta simplicitas at an earlier stage of our discussions on the clause, the noble Baroness, Lady Phillips, seemed to think that 80 per cent. of the country was debarred from receiving legal aid. I shall return to that point also, if I may. Contingency fees are no substitute for legal aid —none whatever. We have gone so far down that road of accessibility to the courts not to be prevented, so far as is reasonably possible, by absence of means.
We then start talking about consumers or, as my noble and learned friend prefers to call them, clients. But there is no one class of consumer at all in contested litigation. There is a plainfiff, a claimant, and a respondent, a defendant. Their interests are directly opposite to one another. The fact is that litigation is a necessary evil, but still an evil. The object of all good litigation ought to be to settle, and to settle favourably, on equitable principles to both parties. It is only if it cannot be settled that you fight the thing to the end. The interests of the parties are opposed.
In an earlier debate, I heard my noble and learned friend say that this was equally favourable to defendants. I am quite sure that it is not. Supposing
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you are having to advise a defendant in a personal injury case, whether or not he is supported by an insurance company, or a defendant in a libel case, whether or not it is a newspaper, or whether or not you are dealing with a defendant in a negligence case based upon professional negligence. A man without means comes and brings forward against you a vexatious, a frivolous or a frankly blackmailing case. You know that if he wins he cannot pay anything towards your costs. You are bound to advise the defendant to offer him something to go away.
But the contingency fee basis cannot meet that case. The courts will in fact be flooded with frivolous, vexatious and frankly blackmailing claims as they were in certain things before the war, which I well remember, where the first seven years of my practice at the Bar were spent and when there was no legal aid whatever. But you are bound to advise him to go away with a small sum of money, if you can. Of course, you will not have won the case. The contingency will be against you and the condition will not have been fulfilled. How can you make up your mind whether you have won or lost?
I invite your Lordships, if your Lordships think that I am just talking as a lawyer, to look at the subsection of this clause which excludes almost all family matters. Why do you supppose that they are excluded? They are excluded because it is impossible to say whether you have won or lost in a very large number of cases. There is no way in which you can define what constitutes winning or losing in a contested case, if your object is to come to an equitable settlement based on the principles of justice. And so obvious is it that that: is so, that in one whole area of the law—namely, family law —it is expressly excluded from the clause. I can only say that to me this is a stark and simple moral issue.
I say this to the noble Baroness, Lady Phillips, who seems to think in terms of plaintiffs and not of defendants, and who wants, as we all do, the maximum access to the courts when there is a good and reasonable claim. We are told that the Scottish system is a model for us all and the model indeed upon which this clause has been framed. The answer to that is that, at the most, we understand that 1 per cent. of the cases are contingency fee cases; and my noble and learned friend on the Cross-Benches, Lord Ackner, made a very good case for supposing that the figure of 1 per cent. is a gross exaggeration, that it is not anything like that. How does the noble Baroness, Lady Phillips, think that this is to be a substitute for legal aid access to the courts? My own view is that it is not and cannot be.
In 1979, the late Lord Elwyn-Jones introduced a set of rules under which about 70 per cent. of the population were covered by legal aid to a greater or lesser extent. I am sorry to say that they have been whittled away, though I did my best to maintain them during my period of office. But I am bound to say that there is more than a suspicion in my mind that what actuates the Cabinet in this case, though I would be the last to suggest that my noble and learned friend necessarily is actuated by the same motives, is to provide a substitute for legal aid in the form of a contingency fee. Even if that is not the object, I am perfectly sure that the Treasury will use

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it as an argument when the next set of regulations occur.
But it is not a substitute. The Scots have voted with their feet. They will not have anything to do with this evil thing. Less than 1 per cent. of the cases are fought on this basis. They cannot touch it with a barge pole and we are asked to imitate them. I hope that we do, if it goes through, which I hope it will not. This is an evil thing and it can only be described as evil and corrupting to an honourable profession.
Lord Mishcon: After that usual eloquent speech of the noble and learned Lord, Lord Hailsham, who mentioned as the main background of his argument the issue of morals, I wonder whether I might put a few thoughts to your Lordships. I do so with very great respect.
I ask your Lordships to realise what is the position today in regard to civil litigation, and what practitioners in the law, who seek to conform with their very honourable traditions, have to deal with? The noble and learned Lord, Lord Hailsham, was absolutely right. I know that it was one of the great prides of my late lamented and much respected friend Lord Elwyn-Jones, that he had brought to legal aid and its limits 70 per cent. of the population of this country. The noble and learned Lord, as one would expect of him, was absolutely accurate regarding that percentage. That percentage has dropped catastrophically and therefore, when one is dealing with the issue of morals, I will tell the Committee in all frankness the position that we on our Benches have to adopt.
It is literally true that 70 per cent. of our population, if faced with the necessity of dealing with civil proceedings either as plaintiff or defendant, if they were to be of any length or importance at all, would have to tell their lawyer. "I know that it is unjust, unjust to me and to my family, but I cannot afford to do it." If that is a moral issue, as I think it is, it is a very important moral issue and one with which we cannot deal with any equanimity at all at the present time.
The limits of legal aid are such —and I repeat it —that it would be literally true that without a grant of legal aid 70 per cent. of our population could not face a long civil case. What do you do about it? You do as I have tried to do, as others of my noble friends have tried to do, as those on the other Opposition Benches have tried to do and as some good folk on the Government Benches have tried to do. We plead with the Government, "Please, in the name of justice, in the name of morals, increase legal aid, unless you want to make a mockery of the famous ideal that our courts of justice are open to all for justice to be done, whether they be poor, whether they be of medium means or whether they be of wealth." Unfortunately the pleas have not met with success. I know, as Members of the Committee know, that if I had made this plea by way of amendment to the Bill —which would be technically impossible —I might say, "Let this clause go but put in its place a grant of legal aid", such as I believe was referred to by the noble Lord, Lord Renton. That would enable
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the people whom I have talked about, the people of medium means, to enter the courts of justice with confidence and without feeling that if they continue to do so they will be ruined and so will their families. We all know, as a matter of reality, that even if such an amendment could be put technically, the Government would not accept it. Nor would they accept an amendment to the amendment which gave us even half of that.
What does one do, faced with the moral issue of whether or not our courts of civil justice are open to all? Unfortunately what one has to do is to compromise. If Members of the Committee ask me personally whether I like the compromise of conditional fees, I have already frankly confessed that I do not. That is not the view of many in my profession; it is not even the view of the Law Society.
Baroness Seear: I am sorry to interrupt the noble Lord. Would be not agree that if we accept contingency fees, that would always be used as an argument against improving legal aid and weaken the case for more legal aid, which is what we on these Benches wish to see?
Lord Mishcon: The noble Baroness has anticipated the last part of my speech but she has put it very much more shortly. I am grateful to her, and I shall try to remember her words when I utter the last part of my remarks.
This cannot and must not be a substitute for legal aid. Even more than that, it is the very reason for Amendment No. 194A, to which I refer the Committee. The amendment says:
"where it appears to the Legal Aid Board that an agreement under section 44(1)"—
that is the very agreement that we are talking about—
"could or ought to have been entered into, that circumstance shall not be taken into account by the Board when performing its functions under section 15(3) of the Legal Aid Act 1988".
That means that if as a minimum —and this is why I am speaking on the Motion that Clause 44 stand part —the noble and learned Lord the Lord Chancellor is not able to say to the Committee that the amendment is accepted, I take it for granted that I must adopt the principle that legal aid will be affected by the grant of approval to this clause of the Bill. My noble friends and I shall have to vote with those who are trying to set this clause aside. If, on the other hand, the noble and learned Lord will give the undertaking that the amendment will be accepted, then I have to consider my position further when advising my noble friends.
4.45 p.m.
Lord Ackner: Before my noble friend sits down, will he be kind enough to indicate whether the compromise which he is reluctantly prepared to accept includes what I understand to be the position under Clause 44? It is that this contingency fee arrangement —and I use the word in the wide form —applies not only to the barrister and the solicitor but to the layman who, under the radical changes proposed by the Bill, will achieve both rights of audience and rights to involve himself in litigation services.
Lord Mishcon: I have considered that position as carefully as I can. I hope that I am not being over-optimistic when I say that I have taken it for granted that the grant of rights of audience to laymen coming from outside the professions of both solicitors and barristers will be so limited that I shall not have to be concerned with the matter. That is the view that most people have taken when they bear in mind the eminence of those who have to decide upon the rules relating to rights of audience.
Lord Campbell of Alloway: With the greatest respect to the noble Lord, Lord Mishcon, I have not had time to consider his proposals of compromise. As I understand them at the moment I find them wholly unacceptable.
Clause 44 contains two insuperable objections which cannot be met by any compromise. For the moment I leave aside the moral objection by my noble and learned friend Lord Hailsham with which I wholly agree. I leave aside any question of the application of the cab rank principle introduced by my noble friend Lord Renton and come straight to the clause. First, as a matter of principle, who has the say on a settlement under Clause 44? Is it the lay client or the solicitor? This is a crucial matter affecting the interests of the consumer which must be dealt with, spelt out and codified in primary legislation.
The second objection is the point taken by my noble friend Lord Rippon. The whole drafting is so wide and so unspecific that when the Motion is put that Clause 44 stand part, I for one cannot possibly vote other than it should not. The whole concept of the clause is so unspecific, so wide and prone to danger and so prone to induce the unjustices about which other Members of the Committee have spoken that as a matter of conscience I should find it impossible to vote that the clause stand part.
At Second Reading it was said assuredly by myself and the noble Lord, Lord Mishcon, that Clause 44 affords no substitute for the proper funding of legal aid. Other noble Lords joined us in that view. That is the problem with which we have to deal. The only way to deal with it is to bring forward another Bill and to vote that as a matter of principle Clause 44 does not meet requirements and should not stand part of the Bill.
Lord Hughes: I was interested in what the noble and learned Lord, Lord Hailsham, had to say about the change in legal aid. He mentioned that the 70 per cent. which the late Lord Elwyn-Jones achieved had been whittled away. My noble friend Lord Mishcon confirmed the 70 per cent. figure. He said that the figure had been drastically reduced. When we on the Scottish Royal Commission considered legal aid we found that the position then —it obviously has not improved in the interval —could be summed up in the phrase which was put to us, which was that only the very poor and the very rich could afford to litigate. Is the noble and learned Lord the Lord Chancellor prepared to allow legal aid to remain in that position?
Lord Donaldson of Lymington: The noble Baroness, Lady Phillips, suggested that this clause should be welcomed by the practising legal profession. For my part, I have some passing doubts as to whether she is right.
Baroness Phillips: If the noble and learned Lord looks at Hansard, I am sure he will find that I certainly did not use that phrase.
Lord Donaldson of Lymington: If I misunderstood the noble Baroness I apologise, but others may take that view. However, for my part I shall put that on one side as I regard it as a total irrelevance. What really matters, and what troubles me greatly, is whether this clause is in the interests of the client as a consumer and whether it is in the interests of the efficient and proper administration of justice. While I accept that there should be innovations in the administration of justice and in the way in which both branches of the legal profession are practised, I have regretfully come to the conclusion that this measure is not in the interests of the client as a consumer. Furthermore, it is wholly contrary to the interests of the proper and efficient administration of justice and therefore contravenes the general principle and the statutory objective which are set out in Clause 14.
First, I shall discuss the position of the client as a consumer. This clause seems to me to create an absolutely classic case of conflict of interest between the client and his lawyer. The basic proposition must be that the better the prospects of the client the less reason he has to agree to a conditional fee agreement. Conversely, the worse his prospects are the less the lawyer should agree to enter into any such agreement.
However, we must bear in mind that the scenario on the ground is of a client walking into a solicitor's office and saying that he has suffered a misfortune. That may be a running down action in which he proposes to be the plaintiff, or he may be in the position of a defendant. It is less usual for individuals of small means to be defendants, but that is not unknown. Either way the client enters the solicitor's office, tells his story and asks the solicitor what his chances of success are. At the moment he will receive an entirely dispassionate answer. However, under the terms of this clause the client then has to ask, if he has heard of conditional fee agreements, whether the solicitor is prepared to take his case on the basis of a conditional fee agreement.
That seems to me to put the lawyer in a wholly impossible position. Is the client to be told, as he would be told under any ordinary application of the present rules of the solicitor's profession, that he cannot be advised because there is a fundamental conflict of interest? He would be told that he must go to another solicitor who will advise him whether or not to enter into a conditional fee agreement with the solicitor he first approached. That practice would be strictly in accordance with the highest traditions of both branches of the profession. I am bound to say that I fear it would be met by the client saying, "They are at it again. Now they are trying to make

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fees for two solicitors." However, that would be quite untrue.
So, first of all, consideration would have to be given to whether there should be provision for the client to be independently advised. Furthermore, it is not just a question of whether or not one enters into the agreement. It is the terms of the agreement which are of vital importance. The noble and learned Lord, Lord Hailsham, treated this clause as if it were a no win, no fee clause. However, it is not. Clause 44(1)(b) states that a conditional fee agreement means an agreement which,
"provides for that person's fees and expenses, or any part of them, to be payable only in specified circumstances".
I do not believe that those circumstances will be specified by subordinate legislation. They will be specified in the agreement.
Advising someone on what specified circumstances should be put into the agreement seems to me to be a highly skilled and difficult operation. Is one to say, "I shall waive my fees provided that you do not secure more than X pounds as damages"; or does one say, "I shall only waive my fees if you lose wholly and have to pay the costs"? I shall not weary the Committee with all the possible combinations, but they are almost infinite. Is the lawyer to advise his client as to what the terms should be? Is he to put all personal protection on one side and try to devise for his client the best possible agreement that the client can possibly obtain against him? That is unthinkable.
Curiously enough, although the clause is hailed as being a magnificent step forward for the client as a consumer I find it surprising that nowhere in the clause is there any suggestion that the client should have a provision which is now traditional in consumer legislation; namely, a cooling-off period. If seven days later he begins to think that the course he took was not the wisest one possible he is stuck with the agreement. I do not doubt that most if not all solicitors would say, if the client went back to them, that they understood and that they would start again. However, we are trying to legislate for the system and that should not depend entirely upon the good will of solicitors.
I fear that there may be a feeling that we are not involved with large sums of money in these cases. However, I regret to say that we are. It is not a matter of satisfaction to me that the costs of litigation are as high as they are. It has to be faced that in personal injuries litigation, to take a typical case, costs can quite easily run into thousands of pounds. Therefore, what the solicitor, and counsel if he joins in, have to consider is whether they are prepared to risk thousands.
Let us not forget that this is not just a question of time. When I was at the Bar I might have been prepared to give my time in the sense that if I did not get paid for it that was just one of those things. But from the solicitor's point of view what he is being asked to do under an agreement such as this is not only to give his time, potentially for nothing, but also to pay disbursements and to pay experts who may be extremely costly. He will of course have
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to pay all the copying charges, which one does not think of as amounting to very much but which solicitors tell me are a not inconsiderable burden in modern litigation.
Against that background there is no doubt that there is one piece of advice which a solicitor could give without any difficulty whatsoever; that is, to tell the client that before they discuss conditional fee agreements they should determine whether the client is eligible for legal aid because legal aid will, in 99 cases out of 100, be infinitely preferable from the client's point of view to a conditional fee agreement. I say that because his liability to pay his own lawyers will be strictly limited to his contribution, and, even more important, he will not normally be liable for his opponent's costs, save a small contribution which may be assessed against him. At the moment it customarily never exceeds the contribution which he has to pay to the Legal Aid Fund. So legal aid is enormously more attractive. However, I accept, and regret, that there is a large litigation poverty trap. If the client finds himself in that poverty trap he will have to look at the alternatives. Just as I have no doubt that legal aid is far preferable, I believe that the conditional fee agreement is not as attractive as it looks.
Clients —and perhaps one or two other Members of the Committee —will think of a conditional fee agreement as meaning that if the client loses he pays little or nothing and if he wins he recovers his costs from the other side. It is very much not so. If he loses he will remain liable for all the costs of the other side. If he wins he will have to pay the uplift of costs. I have no idea of the percentage figure of costs that anyone has in mind. If the basic costs are several thousand pounds, even a small percentage uplift will be a not inconsiderable figure. The client will also have to pay the difference between what are called standard costs which he will recover from his opponent and the costs which his solicitor is entitled to charge.
Standard costs have been fixed upon the basis—which to some extent is fictional —that it is possible to conduct a case for that sum and that every lawyer ought to be prepared to do so. I asked the chief taxing master the other day what in his experience was the difference between standard costs and what I used to call solicitor-known client costs. He said that that was an impossible question because it varied enormously. When I asked him to give me some idea he said that there are some cases which are dealt with on the basis of standard costs but they are relatively few. One could well be looking at a figure of 25 per cent. of the costs as the difference between standard costs and solicitor-known client costs. Therefore, in addition to the uplift, the client who has entered into a conditional fee agreement may be faced with a substantial part of the costs which he still cannot recover from the defendant.
That assumes that the defendant is good for the money. If the defendant is not good for the money, the client will be left to bear the whole of his own costs, including the uplift, for no benefit whatever. That would be the case unless he had had the prescience, or had been advised by his solicitor, to include a clause which provided that he did not have

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to pay his solicitor unless he could recover costs from the defendant. The solicitor is then faced with a further difficulty. How is the solicitor who enters into such a conditional fee agreement to find out what the chances are of his client being able to recover costs from the other side if he is successful?
I hope that the Committee will forgive me for exploring the matter at some length and in some detail. However, in a sense I am a worker at the judicial coalface and I see such cases from day to day in real life.
Perhaps I may turn now to the question of what happens when litigation begins. Conflicts will abound. What happens when the client fails to come up to proof? He may have gone to the solicitor and told him a coherent story, on which his claim is based. He goes into the witness box and tells the same story when examined by his own counsel. Cross-examination then supervenes and the position is found to be very different from what he said it was in examination in chief and from what his own solicitor thought that it was. What happens then?
I am not talking about the extreme cases of which all judges have some experience. I am not talking of the personal injury plaintiff whose action grinds to a startling halt —the plaintiff having claimed to have a broken leg and to be totally immobile —when the defendant produces a video recording showing him skipping around with his children. I am talking about the case in which the situation as revealed in court is totally different from that which the client had led the solicitor to expect. Is the solicitor to be able to get out of the agreement on the grounds of fraud, on grounds of misrepresentation or on grounds of non-disclosure? That aspect has to be looked at seriously.
The question may arise, perhaps at a later stage, whether a client should discontinue a claim. There are cases which are brought bona fide but which on preliminary investigation appear not to have the substance which the plaintiffs genuinely thought they had. In those circumstances anybody would advise the client to discontinue the claim. In such a case the lawyer is likely to say to his client, "It is perfectly true that I have a conditional fee agreement but I advise you to stop these proceedings". If the client turns round and says, "No, I don't agree with you. I am going ahead", what happens? Is the lawyer expected to throw unlimited good money after bad knowing that the case cannot possibly succeed?
If an offer of settlement is made should it be accepted? I am not talking about a lawyer who grabs a settlement in order to obtain his fee but about the lawyer who looks at the matter totally objectively, notwithstanding the existence of a conditional fee agreement. He may say to his client that he ought to accept the settlement. The client may say, "If I go on and lose I shall not have to pay you. It is true that an order for costs will be made against me but all my assets are in my wife's name, so I would rather go ahead". There may be variations that are more reasonable than that scenario. What happens? Is the client to have the right to go ahead and involve the lawyer in much further expense? That would have to be provided for in the conditional fee agreement.
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Who is to advise the client what provision should be included?
Suppose a conditional fee agreement includes a success condition —that the lawyer shall recover not less than £5,000 damages, and assuming costs of £2,000 —what happens if the defendant offers £6,000 as an all-in settlement? what is recovered? Is the lawyer recovering £6,000 and nothing in costs, which meets the success condition, or is he recovering £4,000 damages and £2,000 costs which does not meet the condition? That is another matter that will have to be looked at.
What about appeals? Suppose the client wins in the lower court and the condition in the conditional fee agreement is met and the lawyer is entitled to his fee? What happens when the other side shows signs of appealing? Is the lawyer bound to go on with the case? Does he duck out and say, "That is the end of the proceedings as far as I am concerned"? That again has to be looked at in the conditional fee agreement. There would be real problems if the conditional fee agreement said that one stopped at the end of the proceedings in the court of first instance. The client might be obliged to pay his lawyer the full costs, plus the uplift, and then lose everything in the Court of Appeal and have to pay the other side's costs both in the court below and in the Court of Appeal.
Those are some of the problems facing the consumer. Perhaps I may deal rather more briefly with the problems for the administration of justice, although I regard them as much more serious. As the Committee has already been reminded, lawyers owe a duty to the court which overrides the duty to the client. We are all brought up to that and we all accept it. It is not easy to balance one against the other. The scheme would add a new conflict. There is the lawyer's duty to the court which AS paramount, the lawyer's duty to the client which comes next and now the lawyer's duty to protect himself against undue liability under the conditional fee agreement.
The court relies upon the professional detachment of the lawyers who prepare the case and of those who appear before it and present the case. If the clause were to be passed and put into operation, every judge would want and need to know whether the lawyers appearing before him to argue the case or appearing before him as having prepared the case were also litigants in person because there would be no difference so far as concerns the fees between them and their clients. Both would have a strong interest in winning.
The very notification to the court that the lawyer was appearing on a conditional fee agreement would be objectionable in itself, although essential, because it would tell the judge, "I, the lawyer for the claimant, think this is a good claim, otherwise I would not have entered into the conditional fee agreement". In those circumstances, is the defendant's lawyer who is not on a conditional fee agreement able to stand up and say, "Well, I think my client has a good claim too"? We have never conducted cases on the basis that the judge wishes to know, or can ever be told, what the lawyer thinks of the case for the very good reason that cases should be tried on the evidence and not on the views of lawyers.

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As I have said before, there is a problem here; namely, the problem of the litigation-poverty trap. However, the answer to that, once legal aid, expanded to the maximum extent that government resources permit, has been exhausted, is legal expenses insurance. That is growing rapidly. Or there might be —I do not put this beyond the ability of the market—special insurance to meet one's own costs if one loses. It would be a question of working out a premium on the facts of each case. So far as I know, no one has considered it for reasons which I do not pretend to understand; but it must in theory be possible.
It might also be well worth exploring, as the Law Commission suggested, a contingent legal aid fund as suggested by Justice. I do not put forward any of those ideas in preference to another. I merely say that any of those solutions are better than this clause which I believe to be wholly contrary to the interests of the client as consumer and to the interests of justice.
Lord Morris: Like my noble and learned friend Lord Hailsham, I regret the fact that there are no bishops here, but for very different reasons. I have always believed that it is they who have a problem seeing what makes the world go round.
I want to put a completely opposite point of view from that put at the other end of the Chamber and explain how the matter is perceived, rightly or wrongly, by the ordinary man in the street. The basis of the case put by noble and learned Lords at the other end of the Chamber, not least by my noble and learned friend Lord Rawlinson of Ewell, was that the fact that the lawyer had no direct financial interest in the case was a positive virtue. I suggest that 90 per cent. of the people in this country think that that is a positive evil. It puzzles them greatly. It is not just founded on ignorance. They see over and over again that, if the lawyer has no financial interest in the outcome of the case, he has little or no reason to concern himself too fully in the conduct of the case, litigation and advocacy.
I do not suggest in any way bad faith, but, if noble and learned Lords do not believe this, they should listen to what people say about the casual attitudes that they have encountered among people who conduct their cases and among people in the profession generally. They should speak to the people who work in the magistrates' courts and to those who work in the lawyers' courts. They strongly believe that, if a carefully geared financial interest were placed in the lawyers' hands, it would concentrate the minds of people conducting cases a great deal more.
If the ordinary man in the street had spent all his time with the buttress of clerks, and advocates had spent their time with the buttress of solicitors shielding them from the problem of fees and the terrible burdens that have been brought to bear on clients, we would have a much better system in this country. Rightly or wrongly, that is the view of a great number of people to whom I have spoken on this subject.
Lord Hutchinson of Lullington: Is the noble Lord suggesting that a lawyer in a magistrates' court should be paid more if he secures an acquittal? Is that the basis of what he says?
Lord Morris: I fail to understand how the noble Lord inferred that from what I said.
Lord Hutchinson of Lullington: What is the financial interest in a case in a magistrates' court? That is what I cannot understand.
5.15 p.m.
The Lord Chancellor: I believe in the doctrine of justification by faith alone and in the doctrine of original sin. I also believe that faith without works is dead, being alone, and, therefore, that the faith which is important is that which manifests itself in the way that people conduct themselves in their daily lives.
Perhaps I may begin by answering the noble Lord, Lord Mishcon. There is no question in my mind —I am perfectly prepared to make this as plain as I can, if necessary formally —that the clause is not a substitute for legal aid. It will be no part of the conditions required for an applicant for legal aid that he should first try for a conditional fee arrangement. There is no question of that.
However, for all the time that legal aid has been in existence, including the best possible time of the late Lord Elwyn-Jones—if I may put it like that for the purpose of argument —there has always been a top level of eligibility and therefore a position which is above the legal aid limit. A person may have a perfectly good case and no ready financial resources, and still not be able to take on a good case because he cannot finance it. Until now, it has been unlawful in this country for a solicitor, or a barrister for that matter, to take the case on the basis that he agrees in advance that he will be paid if he wins and not paid if he loses. I understand that to be the position.
A working party of the Bar considered the issue some time ago and drew attention to two matters which I wish to lay before noble Lords. It stated:
"We believe that some solicitors may already be prepared to take meritorious cases in certain circumstances even though their client's means may be such that the solicitors are aware that there is no realistic prospect of them receiving any remuneration for their services unless the client's claim succeeds. Moreover, most laywers will have had experience of cases where for one reason or another they have felt it right to waive their fees in whole or in part, after a case has been decided. Neither type of conduct has, so tar as we are aware, given rise to any real problem. Likewise, we see no real likelihood of difficulty if lawyers and their clients are allowed to achieve the same result by formal agreement made before the litigation is commenced".
I shall not read the whole extract. There are many other points, but the one that I want to make concerns what happens at the present time.
Next, I want to say that my noble and learned friend Lord Donaldson drew attention to a number of matters which would need to be dealt with in relation to a conditional fee. When a person goes to his lawyer he makes arrangements with him about the work that he is to do and the terms on which it is to be done. He does not go to another lawyer for advice about that because in that case the other

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lawyer would need to have some view about the terms on which he was to work, and so on. So some arrangement with one's lawyer is a prerequisite for the lawyer to do any work at all.
The nature of the lawyer's authority is also something that has to be considered. The lawyer will act for the client and he must know what the client wants, the nature of the authority that is conferred and the terms on which the client will have his work carried out. So questions about the nature of the agreement with the lawyer are inherent in the present situation.
In this clause I do not seek to do more than make possible such conditional agreements. There is still full room for the professional bodies and the bodies which in any case regulate rights of audience or rights to conduct litigation to make detailed rules about precisely what is to happen. However, I firmly believe that it is not right to maintain a situation in which all types of conditional fee agreements are outlawed. This clause simply makes it lawful to have a conditional fee agreement which is related to the fees which would be earned apart from a conditional fee agreement, with an uplift (which I described in the White Paper as modest) to take account of the fact that, as my noble and learned friends and other noble Lords will know, the lawyer has to deal with outlays such as costs of photocopying, experts' reports and such matters.
A modest uplift to deal with that strikes me as perfectly reasonable. The detailed arrangements under which that is to take place can be laid down by the professional bodies. The three fundamental duties, which I accept my noble and learned friend Lord Hailsham described accurately, in my judgment are in no way inconsistent with the duty that would arise when a solicitor took on such an arrangement.
My noble and learned friends Lord Hailsham and Lord Ackner referred to the Scottish position; namely, that these arrangements —that is to say, speculative actions, as we call them, in which the lawyer takes on the client on the basis that he will be paid the taxed costs if he wins and not if he loses —have been lawful for many generations, although the percentage related to the amount of damages has not.
The question of the extent to which such an arrangement is taken up is a separate or different matter. The first question is: is it moral, or is there anything immoral about it? I cannot believe that the distinguished lawyers who have operated the Scottish system over many years regard it as in the slightest degree immoral. Of course precautions have to be taken. People have to be reasonably satisfied that a good case exists before it is taken on, but their natural instinct lies in that direction. Their interest in the whole matter is in the direction of not taking it on unless the case is a good one. I believe that that is fundamental.
With regard to settlements, there is said to be special difficulty. I find that quite hard to accept. I take it that it depends on the precise nature of the agreement. As I said, I seek only to take away the complete blanket of unenforceability and illegality
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which characterises such agreements at the moment. But let us take the simple case in which the lawyer agrees with the client that he will only receive his fees if the client obtains them from the other side. When an offer of settlement is made and a payment into court is offered, for example, the client takes the risk, as would also the lawyer, if he does not accept that offer that the costs will go against him.
I have always regarded that as one of the most difficult matters on which to advise. When faced with an offer which will have an effect on costs, what does one do? I have often taken the attitude when advising clients that this is an extremely difficult matter and I must put the full facts before them. It is the client who has to take the decision. Clients have often asked me, "What would you do if it were your own money that was at risk here?" I think that the client regards that question as a very good test.
I have not advised for a considerable time now but in the past I always did my best, judging the issues and risks as best I could, to put myself in the position that it was my own money that was at stake. I have to say that in nearly all the cases that I undertook—except for one notable instance which still stays very much in my memory —the client turned out to be on the right side of the matter. But it is impossible to forecast absolutely accurately.
However, all that is required here is for the lawyer to put himself in a position whereby his situation is affected by the advice in the same way as is the client's situation. It seems to me that from the moral point of view there is no objection whatsoever to a situation of the kind which I have sought to make legal.
I entirely agree that there are other possible matters to be considered but these are matters of detail which can be dealt with. I am simply concerned to remove the law which states that all such agreements, however meritorious they may be in particular circumstances, are not enforceable. The availability of such a right over and above legal aid strikes me as a valuable one for the client. I want to make it as clear as I can that I do not present this provision as a way to some greater type of case. I have founded it on a principle which altogether distinguishes this from the American type of case; namely, that the lawyer's return or remuneration that can be asked for in an agreement, which I am prepared to see as lawful if this clause goes forward, is to be related to the work done and not related to the amount of damages.
My noble friend Lord Peyton suggested various matters. I shall not deal with all three of them. The main point that he mentioned which particularly affects this clause——
Lord Renton: Perhaps my noble and learned friend will be so kind as to allow me to interrupt. I think that we should be quite clear about this matter. What he has just said about this not following the event —no pay, no win —does not seem to be consistent with what is in the White Paper. Paragraph 14.2, which refers back to the Green Paper, states:

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"There was, however, little objection to the proposal that arrangements following the model of the Scottish speculative action (payment of normal fees only if successful) should be allowed in England and Wales".
I think it quite natural that those who considered this matter in relation to this clause should have assumed that what my noble and learned friend was getting at was what he stated in the White Paper.
The Lord Chancellor: I hope that I have said nothing that suggests the contrary. That is precisely what I am getting at. An agreement under which the lawyer is paid if he succeeds is an agreement which may be lawful. The detailed rules about it would certainly be capable of being dealt with by professional bodies. There is nothing outlawing the nature of the rules that they can make.
I am concerned with the general law that makes such agreements unenforceable. That is exactly what I am talking about. I hope that I have said nothing that puts that into any doubt.
Lord Diamond: The noble and learned Lord referred to these arrangements being unenforceable. He has referred to them as being illegal. Are they illegal and therefore unenforceable; or are they only unenforceable?
5.30 p.m.
The Lord Chancellor: The accurate position is that they are unenforceable by reason of their quality. That is to say, the law does not regard them as allowable and therefore they are unenforceable agreements. That is my understanding of the position, on the basis that public policy is against them. It is quite difficult to have such a public policy —which is the policy of the legislature of the United Kingdom —which allows them in one jurisdiction but not in another.
In my submission therefore it is right that they should no longer be regarded as unenforceable provided that they conform to the conditions that I have specified, and any other conditions that may be laid down.
Lord Ackner: Will my noble and learned friend confirm whether the Scottish model is to be extended in Scotland to non-lawyers? As I understand the clause, it will cover not only barristers and solicitors but non-lawyers who have achieved the right of audience or the right to litigate.
The Lord Chancellor: The provision would apply to those who have been afforded rights of audience under the machinery that is set out in the earlier clauses, including the right to conduct litigation.
Lord Ackner: My inquiry was whether that will also apply to Scotland, or whether the Scottish situation is to remain as I understood that it was: limited to barristers and solicitors.
The Lord Chancellor: As I understand it, the Scottish situation is that an agreement such as has been described is not unlawful, and is enforceable
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in Scotland. Therefore I do not think that my noble and learned friend's question arises. It would not be unenforceable, whoever made it, because such an agreement as I have described is regarded as appropriate, not contrary to public policy.
The final point that I wished to make in answer to the noble Lord, Lord Peyton, was in relation to Americanisation, or something of that kind. In my submission, the provision is fundamentally distinguished in principle from the American system which relates to the payment of remuneration to the lawyer that is related to the amount of damages recovered and is not related to the work done. I believe that it is perfectly reasonable to relate payment to the work done. I distinguish that from a situation in which the payment has nothing whatever to do with the work that one has done but is related to the amount recovered.
I should have mentioned one other point. There have been so many; I hope that I have dealt with the principal ones. My noble and learned friend Lord Hailsham referred to an earlier point that I made about plaintiffs and defendants. I said then that such an arrangement applies to a defendant just as much as to a plaintiff. He made a point —if I remember rightly in the debate on the Green Paper when speaking in answer to the noble Lord, Lord Henderson of Brompton —that such an arrangement could not apply to defendants. My point is that the arrangement that I have suggested is permissible under the clause is available to plaintiffs and to defendants. I believe that there is very considerable security against any abuse of the system because, as has been pointed out, the award of costs against the plaintiff would still be available if the plaintiff does not succeed. These cases therefore are not likely to be taken unless the plaintiff has a good case.
The injustice that these arrangements address is this. At the present time if somebody is not eligible for legal aid —however high the legal aid limits were, there is a possibility of people being above them although they have a good case—unless he has the finance to undertake what might be quite an expensive litigation, he can do nothing. That makes such a method possible, subject to any detailed rules that the professional bodies in control of the citation might think it right to lay down.
Lord Hailsham of Saint Marylebone: If my noble and learned friend will forgive me, before he finally sits down, I wish to put on record that the point I was making was not that the arrangement under the clause was unavailable to defendants, but that it was virtually useless to defendants against a vexatious, frivolous or blackmailing plaintiff. The economics are against the defendant being able to enjoy that arrangement. My point was not that it was unlawful for such an agreement to be made in favour of the defendant.
The Lord Chancellor: That is a different point from that with which I was dealing when I spoke. My noble and learned friend now makes the point that such an arrangement could give rise to blackmail. I do not accept that. I believe that the arrangement would include the requirement, with

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regard to the professional rules, that the client had a reasonable case. It is well known that under the present arrangement somebody with a small amount of money can start a case. People settle cases on the basis that it is economical to settle them even if they think the client does not have a good case. That is particularly so in relation to legal aid. However, I do not believe for a minute that such consideration should tell against the lawfulness of the legal aid system.
People may think that they have a good answer. All that is required is a reasonable case on the merits for legal aid. That is not a reason why legal aid should not be allowed. In this case the defendant would be even more protected because, as the noble and learned Lord, Lord Donaldson, pointed out, at present under legal aid arrangements the defendant may not be able to recover his costs and may certainly not be able to recover them against the plaintiff. I hope that the Committee will feel that it is a proper arrangement to provide, while leaving it to the professional bodies to make the detailed rules, and on the understanding that such provision is not a substitute for legal aid but available over and above legal aid, whatever the legal limits were.
Lord Mishcon: Before the noble and learned Lord finally sits down, I have put to him —I hope in clear and fair terms —that I hoped he would accept Amendment No. 194A when it was moved. I understood him to say that he accepted the principle behind the amendment. If he could kindly give me his assurance that that amendment will be accepted when it is moved I shall know where I stand. If he does not, I do not know where I stand.
The Lord Chancellor: I certainly agree with the principle of the amendment. I am perfectly content with the amendment as it stands, subject to any later drafting which the draftsman may suggest. However, I am now prepared to accept it as it stands.
Lord Mishcon: I am obliged.
Lord Meston: I hesitate to interrupt but Members of the Committee should be aware that the amendment proposed by the noble Lord, Lord Mishcon, is as good as far as it goes but I do not believe that it goes far enough. Clause 44 will still have the potential to erode legal aid. Financial eligibility for legal aid is not determined by the Legal Aid Board but by the Treasury. Although the new clause proposed by the noble Lord, Lord Mishcon, will bind the Legal Aid Board, it will not bind the Treasury in determining eligibility for legal aid.
The Lord Chancellor: That is why I indicated that I am perfectly content with the principle that the availability of a conditional fee agreement in no way affects eligibility for legal aid. I hope that I made absolutely plain what I have in mind; that whatever the eligibility limits, the agreement would be available over and above eligibility for legal aid.
I cannot see the argument that availability of such an agreement would take the place of legal aid. They are quite different. As was said by my noble and
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learned friend Lord Donaldson of Lymington, the protection afforded by legal aid to the client is much greater, although in some matrimonial cases it is not as great as some people think.
Lord Rippon of Hexham: If the clause is accepted will not the Lord Chancellor be able to say to his right honourable friend the Chancellor of the Exchequer, "I am now in a much better position to resist any improvement at all in legal aid"?
The Lord Chancellor: Certainly not. The Legal Aid Act makes provision for those of poor or moderate means. I do not believe for one moment that this would be an appropriate answer to legal aid. This is an additional provision over and above legal aid. I believe that it is right to make possible that agreement under such conditions as thought appropriate by the bodies regulating rights of audience and rights to conduct litigation.
5.42 p.m.
On Question, Whether Clause 44 shall stand part of the Bill?
Their Lordships divided: Contents, 136; Not-Contents, 56.

DIVISION NO. 1

CONTENTS

Alexander of Tunis, E.

Greenway, L.

Allen of Abbeydale, L.

Griffiths, L.

Allerton, L.

Halsbury, E.

Ardwick, L.

Harmar-Nicholls, L.

Barnett, L.

Hayter, L.

Beaverbrook, L.

Henderson of Brompton, L.

Belhaven and Stenton, L.

Henley, L.

Belstead, L.

Hesketh, L.

Bessborough, E.

Hives, L.

Bethell, L.

Home of the Hirsel, L.

Blatch, B.

Hooper, B.

Boyd-Carpenter, L.

Howie of Troon, L.

Brabazon of Tara, L.

Hughes, L.

Brightman, L.

Irvine of Lairg, L.

Broadbridge, L.

Jeger, B.

Brougham and Vaux, L.

Jenkin of Roding, L.

Butterworth, L.

Jenkins of Putney, L.

Campbell of Croy, L.

John-Mackie, L.

Carmichael of Kelvingrove,

Johnston of Rockport, L.

L.

Joseph, L.

Carnegy of Lour, B.

Kaberry of Adel, L.

Carnock, L.

Kilbracken, L.

Cocks of Hartcliffe, L.

Killearn, L.

Coleraine, L.

Kirkhill, L.

Cottesloe, L.

Lauderdale, L.

Craigavon, V.

Layton, L.

David, B.

Llewelyn-Davies of Hastoe,

Davidson, V. [Teller.]

B.

Dean of Beswick, L.

Long, V.

Denham, L. [Teller.]

Lucas of Chilworth, L.

Derwent, L.

Lyell, L.

Dilhorne, V.

Lytton, E.

Dormand of Easington, L.

Macaulay of Bragar, L.

Elibank, L.

McIntosh of Haringey, L.

Ellenborough, L.

Mackay of Clashfern, L.

Elliot of Harwood, B.

Mackie of Benshie, L.

Faithfull, B.

Macleod of Borve, B.

Fisher of Rednal, B.

Malmesbury, E.

Fraser of Carmyllie, L.

Mancroft, L.

Fraser of Kilmorack, L.

Margadale, L.

Gallacher, L.

Marshall of Leeds, L.

Galpern, L,

Mason of Barnsley, L.

Goold, L.

Merrivale, L.

Graham of Edmonton, L.

Mersey, V.

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Middleton, L.

Selkirk, E.

Milverton, L.

Serota, B.

Mishcon, L.

Shaughnessy, L.

Montagu of Beaulieu, L.

Shrewsbury, E.

Morris, L.

Skelmersdale, L.

Mottistone, L.

Strabolgi, L.

Mowbray and Stourton, L.

Strange, B.

Munster, E.

Strathclyde, L.

Napier and Ettrick, L.

Strathcona and Mount

Nelson, E.

Royal, L.

Nicol, B.

Strathmore and Kinghorne,

Nugent of Guildford, L.

E.

Orkney, E.

Sudeley, L.

Orr-Ewing, L.

Swansea, L.

Pender, L.

Taylor of Blackburn, L.

Peston, L.

Taylor of Gryfe, L.

Phillips, B.

Terrington, L.

Pitt of Hampstead, L.

Trumpington, B.

Prys-Davies, L.

Ullswater, V.

Rankeillour, L.

Underhill, L.

Rea, L.

White, B.

Reay, L.

Whitelaw, V.

Renwick, L.

Windlesham, L.

Rodney, L.

Wise, L.

Saltoun of Abernethy, Ly.

Wyatt of Weeford, L.

Sanderson of Bowden, L.

Young, B.

NOT-CONTENTS

Ackner, L.

Kennet, L.

Amherst, E.

Kinloss, Ly.

Ampthill, L.

Lloyd of Kilgerran, L.

Attlee, E.

Melville, V.

Aylestone, L.

Meston, L.

Benson, L.

Moyne, L.

Bonham-Carter, L.

Peyton of Yeovil, L.

Brandon of Oakbrook, L.

Rawlinson of Ewell, L.

Byron, L.

[Teller.]

Caccia, L.

Renton, L. [Teller.]

Campbell of Alloway, L.

Richardson, L.

Crook, L.

Rippon of Hexham, L.

Diamond, L.

Roskill, L.

Donaldson of Lymington, L.

Sainsbury, L.

Elles, B.

Seear, B.

Ennals, L.

Shannon, E.

Falkland, V.

Shepherd, L.

Gladwyn, L.

Simon of Glaisdale, L.

Goff of Chieveley, L.

Somers, L.

Grantchester, L.

Stedman, B.

Grey, E.

Templeman, L.

Hailsham of Saint

Teynham, L.

Marylebone, L.

Thomas of Gwydir, L.

Hampton, L.

Tordoff, L.

Harris of Greenwich, L.

Tryon, L.

Hutchinson of Lullington, L.

Wigoder, L.

Hylton-Foster, B.

Wilberforce, L.

Inglewood, L.

Winchilsea and Nottingham,

Jenkins of Billhead, L.

E.

Kearton, L.

On Question, Motion agreed to.

Resolved in the affirmative, and Clause 44 agreed to accordingly.
5.51 p.m.
Lord Mishcon Lord Mishcon moved Amendment No. 194A:
After Clause 44, insert the following new clause:
("Protection of legal aid client in conditional fee agreements
.Where it appears to the Legal Aid Board that an agreement under section 44(1) could or ought to have been entered into, that circumstance shall not be taken into account by the Board when performing its functions under section 15(3) of the Legal Aid Act 1988.")
The noble Lord said: I do not believe that it is necessary to do other than move this amendment which I understand the noble and learned Lord is prepared to accept.
Lord Renton: Before my noble and learned friend replies, there is one matter which I find rather
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strange; that is, the words "or ought to have been". I did not believe that it was within the principles which my noble and learned friend expressed or in Clause 44 as it stands that there was to be any obligation to enter into a conditional fee agreement. The words "or ought to have been" suggest that there is such an obligation. Therefore, when further considering the drafting of this amendment I hope that my noble and learned friend will bear that in mind. I believe it is quite wrong to have those words in the amendment.
Lord Ackner: Before my noble and learned friend replies, it should be put on record that there is another acute difficulty which I do not believe has been faced up to. What is to happen when the lawyer for the plaintiff who has engaged himself on a contingency fee finds that the defendant is awarded legal aid to combat him?
Lord Mishcon: I refuse to use the words "contingency fee" because that is not the phrase which occurs in the Bill. It is not a phrase I shall use; it is not a phrase which I should have supported in the Division Lobby. The amendment is not to be deemed to be in substitution of legal aid. When an applicant for legal aid appears before the legal aid authority or his application is dealt with, the fact that this sort of arrangement may have been entered into should not be taken into account at all by the legal aid authority. That is all that the amendment says; that is all that it is meant to say. I have no doubt that the noble and learned Lord will consider the words "or ought to have been", although I cannot see any harm in them.
Lord Hailsham of Saint Marylebone: I hope that my noble and learned friend will pay some attention to the words "or ought to have been". I do not know what they can mean in those circumstances. By what criterion does the obligation come into an agreement of this kind? If legal aid is to be granted and it is a suitable case for legal aid, how could it possibly be right for such an agreement to be entered into?
Lord Mishcon: Perhaps I may give an example, I hope that the noble and learned Lord will find it fitting because we have spoken so much about personal injury cases. Let us take for granted that a plaintiff is knocked over by a car which has mounted the pavement and the driver is drunk. That person goes to a solicitor for help. The solicitor applies for legal aid. Without this amendment the board might conceivably say, "But you know this is just a case of the matter speaking for itself. It is re ipsa loquitur. It is impossible to lose this case. Why apply for legal aid? You should have talked to your solicitor or your solicitor should have talked to you about entering into one of those agreements. Have you discussed that with him? Why do you not want that?" I want to make it clear that there is no duty upon that person to say why he or she has not applied for it or on the solicitor to say why he has not discussed that with the client.
Lord Hailsham of Saint Marylebone: If legal aid is likely to be given —and of course it would be, means test apart, because the merits of the case are so obvious, as the noble Lord pointed out —then surely it is obvious that legal aid is the preferable alternative of the two.
Lord Mishcon: I hope that the noble and learned Lord will forgive me for saying that I am still in the position where I thought that my argument for the amendment was abundantly clear. It is not that the Legal Aid Board might say that legal aid is obviously preferential. It is to stop the legal aid authority saying to an applicant, "But do you realise that there is another course open to you? Have you discussed it with your solicitor or has your solicitor discussed it with you because that should be a matter for consideration and you should not trouble the Legal Aid Fund". In this amendment I am setting down a provision to stop any such question or discussion.
The Lord Chancellor: I said earlier that I accepted this amendment subject to any question which may be raised by the draftsman as regards the precise wording. I shall take into account what my noble friend Lord Renton said. I believe that that is the best way to proceed. I am sure that the noble Lord, Lord Mishcon, will be quite happy that we should seek to meet those difficulties so long as the principle is accepted.
I do not wish to create any impression that there is an obligation on anyone to enter into a conditional fee agreement. That is an option. I believe that the noble Lord, Lord Mishcon, had in mind when drafting this amendment that the Legal Aid Board might consider that there was an obligation. We want to negative that. Subject to the drafting of this amendment I accept it. I believe it is best that this amendment should now be written into the Bill reserving the right to come back on the detail of the drafting to try and meet those concerns because, as I said, I wish to meet them if I possibly can.
Lord Renton: In order that we can be constructive as well as critical, I suggest that the words "or ought to have been" could be replaced by the word "reasonably".
Lord Mishcon: The last thing in the world I want is the importation of the word "reasonably". I want that to be completely out of the discussion when the Legal Aid Board considers these applications, reasonably or unreasonably.
6 p.m.
Clause 45 [Regulation of right of Scottish and Northern Ireland lawyers to practise in England and Wales]:
Lord Rawlinson of Ewell Lord Rawlinson of Ewell moved Amendment No. 195:
Page 36, line 11, after ("Lord Chancellor") insert ("with consent of the Lord Chief Justice").
The noble and learned Lord said: Perhaps I may speak to Amendments Nos. 195, 196 and 197, all of
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which deal with the right of Scottish and Northern Ireland lawyers to practise in England and Wales. I am qualified under this proposal because I am a member of the Northern Ireland Bar. The noble and learned Lord the Lord Chancellor will know all about the Scottish advocates.
All I suggest here, as I have suggested before, is that where it is a matter of permission being given to a practitioner qualified in Scotland or Northern Ireland and the Lord Chancellor is making the regulations, he should do that with the consent of the Lord Chief Justice. The Lord Chief Justice is the permanent head of the judiciary in this particular jurisdiction and it seems only right that in England we should have at least the head of the English judiciary as the person who will consent to regulations whereby persons from other jurisdictions come and practise in the courts of this country. That is the proposal in Amendment No. 195 which is followed by Amendments Nos. 196 and 197. I beg to move.
Lord Boyd-Carpenter: I hope my noble and learned friend will not accept this amendment. It seems to be quite wrong in principle that when a Minister of the Crown seeks to make regulations he should require the consent of somebody else. It puts him in the obvious difficulty that if consent is withheld, he cannot make the regulations which he feels he ought to make and which he may very properly be being pressed in either House of Parliament to make. Therefore to place a veto on the Lord Chancellor's regulation-making power in this way —even in favour of a deeply respected figure like the noble and learned Lord the Lord Chief Justice —is quite wrong in principle.
The Lord Chancellor: My noble and learned friend may take it that in contemplating regulations of this kind I should certainly wish to take the mind of the Lord Chief Justice as well as the other heads of division. The purpose of this clause, however, is to mirror as between the constituent law districts of the United Kingdom the rules made for the European jurisdiction. These are made under directives, as my noble and learned friend knows, and the Lord Chief Justice is not directly concerned in that procedure, though his views would necessarily be important.
I therefore think that, with the greatest respect, it is not appropriate that the noble and learned Lord the Lord Chief Justice should be mentioned particularly here. However, my noble and learned friend can be assured that in any regulation under this clause the Lord Chancellor would consult the heads of division.
Lord Rawlinson of Ewell: I thank my noble and learned friend the Lord Chancellor for those comments. They are very different from the authoritarian attitude of my noble friend Lord Boyd-Carpenter, who does not want to see on any basis, when we are introducing a Minister to matters of the legal profession, the introduction of the judiciary. As he ought to appreciate by now, we are starting on uncharted ground with a regulation affecting the independent legal profession.
Lord Boyd-Carpenter: Perhaps my noble and learned friend will allow me to intervene. If he is good enough to make a personal onslaught on me for being authoritarian, perhaps I may suggest that he is being authoritarian in as much as he is seeking to put part of a regulation-making power into the hands of a very distinguished judicial figure who is not responsible to Parliament. If anything is authoritarianism, cutting out Parliament in that way is precisely that.
Lord Rawlinson of Ewell: I am sorry that my noble friend is so sensitive about the word "authoritarian" which I boomed at him over his right ear. I received a copy of a letter which was addressed to the noble and learned Lord the Lord Chancellor, supporting the Lord Chancellor and complaining about the "crusty old men Lords Rawlinson, Hailsham and Boyd-Carpenter". Whether he likes it or not, he is aligned with us.
The view I have always expressed is that because this has a particular kind of ministerial interest —control over an independent legal profession —we should always have allied with it a member of the judiciary. I have consistently argued that throughout the course of the Bill. However, having regard to the way my noble and learned friend, with such grace as always but with such reasoning, has spoken in reply I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hacking Lord Hacking moved Amendment No. 195ZA:
Page 36, line 13, leave out ("in such capacity as may be prescribed") and insert ("in that capacity").
The noble Lord said: In moving this amendment I speak also to Amendment No. 197A. Both of these amendments are probing amendments and, as I understand it, the object of Clause 45(1) is to enable the Lord Chancellor to make regulations to ensure that lawyers from other parts of the United Kingdom are able to exercise rights of audience or rights to conduct litigation in England and Wales which are not less than lawyers from other member states under the lawyers' services directive of 1977.
Under this directive lawyers from other member states of the European Community, have the right to provide such services in this country, or indeed in another member state, from an establishment in their own home state in their capacity as lawyers of their home state. The matching provisions within the United Kingdom should therefore follow the same lines. For example, any right of audience exercised in English courts by a Scots advocate should be exercised in his capacity as a Scots advocate and not in any other capacity. To say that he may do so in some other capacity will cause difficulty if not a little confusion. It requires a little clarification and perhaps the noble and learned Lord may be able to help. I beg to move.
The Lord Chancellor: I am sorry to say that I am not absolutely clear precisely what it is the noble Lord seeks to achieve by this amendment. The proposal is that a Scottish advocate will have rights of audience in England, for example, on the same
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basis as if he were a member of a profession in Germany that had rights of audience in the courts there.
That I think is what is sought by both of us. For example, a Scottish solicitor has very different rights of audience from an English solicitor so far as the different levels of court are concerned in Scotland. Some form of adaptation may be required if one crosses the boundary. I believe the regulations should have sufficient flexibility to enable us to do that. That is why we have the phrase,
"in such capacity as may be prescribed".
It is in order to cope with that situation. It is to try to lay down what rights in England the person from Scotland might have when there is no absolute correspendence between the different categories of profession in the two jurisdictions.
The Earl of Selkirk: My noble and learned friend appears to be saying that when a Scots solicitor comes to England he will be allowed to appear in the equivalent of the sheriff court. Is that what my noble and learned friend is saying; or is he saying that as a solicitor he will be entitled to appear in the High Court?
The Lord Chancellor: That is one of the difficulties the clause has to deal with. I seek to mirror the arrangements that we have so far as the EC is concerned. To take the example of my noble friend, there might be difficulty in the idea that a Scottish solicitor should come to England and have a right of audience in a court here where no English solicitor had a right of audience. We are trying to cope with that situation by allowing us to have the capacity to prescribe rather than making it completely automatic. These directives are difficult to apply across the nations at the moment and we simply want to achieve a similar result, so that a Scots person should not be able to say that in England he has fewer rights than a Frenchman or German in similar situations. Conversely, an Englishman going to Scotland would have no fewer rights than a corresponding Frenchman or German would have in the same situation.
Lord Hacking: I am very grateful to the noble and learned Lord. It fortifies the mainstream argument that lawyers in Scotland, England and in Northern Ireland should have similar rights of audience as a result of which these problems would not arise. I am grateful to the noble and learned Lord for his exposition. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Coleraine Lord Coleraine moved Amendment No. 195A.
Page 36, line 17, leave out from ("litigation") to end of line 19.
The noble Lord said: Paragraph 13.4 of the White Paper Legal Services: A Framework for the Future points out:
"that lawyers qualified only in one part of the UK already have, and will increasingly have, greater opportunities to practise in other EC member states than they do in other parts of the UK. This is clearly anomalous".
The purpose of Clause 45 as a whole is to give effect to paragraph 13.5 of the White Paper which states:

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"The Government therefore proposes that the Lord Chancellor, the Secretary of State for Scotland, and the Secretary of State for Northern Ireland should be given power to make regulations which will ensure that UK lawyers have rights to practise in other parts of the kingdom at least equivalent to those available to lawyers from other EC countries".
The general objective of giving lawyers from one part of the United Kingdom at least as many rights regarding practice in other parts of the kingdom as lawyers from other EC countries is supported by the Law Society. It is at its request that I move this amendment. However, it is not appropriate or necessary for this purpose to enable lawyers from one part of the United Kingdom to provide conveyancing or probate services in other parts of the kingdom.
The EC lawyers' services directive 1977 enables lawyers from one member state to provide occasional services, including litigation and advocacy, in another member state subject to certain conditions. It expressly enables member states to reserve to prescribed categories of lawyers the preparation of formal documents for obtaining title to administer estates of deceased persons and the drafting of formal documents creating or transferring interests in land; namely, conveyancing and probate.
The Order in Council implementing the directive in the United Kindom accordingly excluded lawyers from other EC countries from the right to provide conveyancing or probate services in the United Kindom. In most other member states such services are generally provided by notaries who are not within the lawyers' services directive at all. In these circumstances it seems that references to conveyancing or probate services in Clause 45(1)(b) are inappropriate. This amendment proposes their omission. I beg to move.
The Lord Chancellor: I accept this amendment in principle. There is a slight problem concerning the consequent drafting. Perhaps my noble friend will allow me to make the corresponding alteration in terms that the draftsman would wish. I do not believe that this particular clause is inconsistent with the undertaking that I gave in the White Paper to make regulations which will ensure that United Kingdom lawyers have rights to practise in other parts of the kingdom at least equivalent to those available to lawyers from other EC countries. But the clause as drafted goes further in making provision for such cross-border practice than the service directive does with regard to inter-state practice. That was not my original intention, and for that reason I am prepared to accept this amendment in principle.
The amendment as drafted would leave the clause with a list at subsection (1) consisting of paragraph (a) and nothing more, and that is a matter I wish to deal with. I accept the amendment in principle and I undertake to bring forward at Report stage an amendment to the same effect as his.
Lord Coleraine: I am delighted to learn that the amendment is accepted in principle by my noble and learned friend. Therefore in order that he may see the drafting corrected, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 196 to 197A not moved.]
6.15 p.m.
On Question, Whether Clause 45 shall stand part of the Bill?
Lord Simon of Glaisdale: In the interests of constitutionality and economy of words in the statute book, I draw attention to two matters on this clause. The first is the relationship between subsections (2) and (3). This subject is an old favourite in that,
"The Lord Chancellor may by regulations",
do such and such. Subsection (3) says that my noble and learned friend the Lord Chancellor "may, in particular" make regulations. Those are the particularities of subsection (2). When this matter arose before, there were about 15 lines similar to subsection (3). This time there are 13 lines. So the issue mounts up in size.
I said that the equivalent of subsection (3) was unnecessary. My noble and learned friend said that, strictly speaking, it was unnecessary. There was undoubtedly the implication that he thought that there were nevertheless reasons to put the subsection in. We can return to the matter and discuss it at Report stage when I shall table an amendment to leave out subsection (3). I thought that at this moment I would draw to the Committee's attention what I and I am sure other Members of the Committee regard —particularly the noble Lord, Lord Renton —as completely unnecessary verbiage. It is mounting considerably and soon we shall have a whole page of the statute book in the Bill.
The other matter is the regulation-making power in subsections (2) and (4). In both cases they are subject only to the negative resolution procedure in Clause 82. As regards subsection (4). there is yet another Henry VIII clause in which a Minister seeks power to amend the existing rule of law or practice. I do not take a categorical view against Henry VIII clauses. I am content with the line that is drawn by the Donoughmore Committee. In other words, each clause must be justified on its own merits, the onus being against the person putting forward a Henry VIII clause who must show that it is necessary and justify it to the hilt.
No attempt has been made to approach any of the Henry VIII clauses on that basis. There is a later amendment which, if the Government business managers have their way, will come on in the early hours of the morning. I fear that the hour is likely to be later than that. It is an amendment to make all the regulating powers under Clause 45 subject to affirmative resolution. I am simply indicating that at the moment they are subject only to the negative procedure. That situation is particularly blatant regarding subsection (4) which is a Henry VIII provision.
Lord Renton: The noble and learned Lord, Lord Simon of Glaisdale, has drawn attention to a clause which could have been expressed much more succinctly. Several of the subsections overlap. I should have thought that the draftsman would be well advised to consider a complete revision of the clause without altering its meaning or effect. It is one of the few clauses of the Bill which I favour.
The Lord Chancellor: I am grateful to know that my noble friend favours this clause. Perhaps as we go forward he will find others that he may favour. I understand the point made by my noble and learned friend Lord Simon of Glaisdale, and I have sought to explain before that I give this kind of detail in order to try and give notice of what is in mind. He is correct that at present the regulation-making power is subject to the negative resolution procedure. No doubt we can consider later whether that is appropriate. The idea is to give effect to the principle of directives. That was the reason for it. I hope that the Committee will approve the clause.
Clause 45 agreed to.
On Question, Whether Clause 46 shall stand part of the Bill?
Lord Hutchinson of Lullington: I should like the noble and learned Lord the Lord Chancellor to make clear the precise meaning and implication of the clause. Subsection (1) seems to say that barristers may be directly approached by members of the public and may enter into contracts for the provision of legal services. Does "a contract with his client" mean with his professional client and/or with his lay client? I presume that the implication of the clause is that from now on any advocate, be he barrister or solicitor, may be directly approached by any member of the public. Is that what the clause means? Under subsection (1) the Bar may make rules restricting that direct access if it so wishes. Does that mean that other advocates may not make such restrictions?
The question of direct access has not hitherto come up for discussion under the Bill. I should like to raise other matters, but I shall not waste the time of the Committee if the noble and learned Lord can explain straightaway whether I have understood the clause entirely wrongly or whether what I am saying is the implication of the clause.
Lord Renton: The noble Lord, Lord Hutchinson, is not wasting time. An extraordinary situation arises under the clause. I did not understand it until I read the Notes on Clauses. Under the heading "Policy Objectives", which follows the detailed explanation of the contents of the clause, its aim is set out:
"Subject to regulation by the profession, to facilitate direct access to barristers by persons other than solicitors and to help to ensure that the law does not unnecessarily restrict the ways in which barristers may offer their services".
It goes on to say:
"It will enable barristers to sue for their fees and, subject to their immunity from suit in relation to advocacy work, to be sued".
It adds:
"The General Council of the Bar is to remain free to make rules if it so wishes restricting barristers' rights to enter into contracts".
I have two comments on what appears to be the purpose of the clause. As the noble Lord, Lord Hutchinson, pointed out, it is an indirect way of abolishing the rule that barristers can accept instructions only from solicitors. They cannot do so direct from lay people. Secondly, it will enable barristers for the first time to sue for their fees and to be sued. They can be sued at present for negligence
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in respect of non-advocacy work. Those two things are done in a rather indirect and hidden manner. What I find most extraordinary is that having said, and having enacted directly or indirectly, that any rule of law which prevents a barrister from entering into a contract with his client is abolished, it goes on to pass the buck to the General Council of the Bar to decide whether or not his new rule of law shall apply. I find that a rather strange method of legislating.
In the past these matters have been left, and left successfully, to the profession. Here we say in one subsection that it does not need the profession to make a rule, and then in the next subsection we say that the General Council of the Bar can restrict the barrister's right of entering into contracts. Perhaps my noble and learned friend the Lord Chancellor can explain the methods he has used in this clause.
The Lord Chancellor: There is a fairly strong view that a rule of law prevents a barrister as such from entering into a contract with his client for the provision of his services as a barrister. That prevents him from among other things suing for any fee that may have been arranged in advance. If there is such a rule I have sought in this clause to take it away but make it absolutely clear that the General Council of the Bar can regulate any matter in this connection. It is therefore entirely open to the General Council of the Bar to make any rules it wishes about it.
As the noble Lord, Lord Hutchinson, will know, part of the present arrangement at the Bar is that access can be had through other than solicitors. It is important that barristers should if they wish be able to make arrangements enforcible at law if that is to be allowed to happen as concerns advice services. I wanted therefore to give the maximum freedom to the Bar to make what rules it wishes. As barristers can be sued in certain contexts, it is right that they should no longer be obliged to accept a situation in which they cannot get money out of a client, even if he has money, just because the client refuses to pay. I think I am right in saying that at present direct access by professionals —for example, accountants and patent agents —is allowed. The possibility of having contractual relations will be helpful in that connection. This clause is in no way intended to deal with the Bar's rule restricting direct access by lay people. There is a nothing in the clause concerning the propriety of the rule. That matter is left entirely to the Bar to regulate. If the Bar were to take the view that in some cases direct access should be permitted, then it might think that a contract was appropriate. The whole idea is to give the Bar Council maximum freedom to make the arrangements, consistent with its professional standards, which it thinks best for the organisation of the profession.
6.30 p.m.
Lord Hutchinson of Lullington: I do not believe that the noble and learned Lord has appreciated the point that I am trying to discover. If the law allowed an advocate to enter into a contract with his client for the provision of his services that must mean that

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that client can have direct access to that lawyer; otherwise how can he enter into such a contract? It seems to me that once that is permitted the implication must be that the clause permits direct access by a member of the public to the advocate. That member of the public will say to the advocate, "Will you represent me in this case in the Crown Court next week?" The advocate then says, "Yes, I will, and we will have an agreement as to the terms upon which I represent you". If that is the implication of the clause, I should like to say a great deal more about it because the playing field envisaged in subsection (2) is ludicrously bumpy if a restriction on direct access applies only to members of the Bar and does not apply to other advocates.
The Lord Chancellor: The clause applies only to barristers and no one else. So far as I know, such a rule applies only to barristers. Therefore there is no bumpy or exceptional playing field. The General Council of the Bar is the professional body having full authority over every person covered by the clause. So there is nothing in the clause to oblige or enable a barrister to have direct access with a lay client in the Crown Court if the General Council of the Bar prohibits it.
It is not necessary to have direct access to have a contract. One could have a contract under which a solicitor, acting on behalf of his client, instructs a barrister and makes it clear that any instructions to the barrister from the client are to come through to the solicitor. One of the things that can happen under the present arrangements is that, the solicitor having instructed counsel on behalf of his client, the client may decide, for whatever reason, that he is not going to pay for the work that the barrister has done. If the solicitor decides that he does not want to do anything about it, there is nothing that the barrister can do at law to recover his just remuneration. That is no longer consistent with the present situation.
The clause gives the barrister the right, if he does not have it at the moment, to enter into a contract with his client in any way permissible by law, and leaves it to the General Council of the Bar, which rules every barrister, to make the rules necessary to deal with that matter. To take the example of direct access: the Bar's present rules, restricting direct access by lay clients to barristers, are in no way affected or reduced by the clause. I hope that the noble Lord sees what I have sought to achieve. My understanding is that the General Council of the Bar supports the clause —I hope that I am right about that —as being desirable in the interests of the Bar in the present situation.
Lord Donaldson of Lymington: Before my noble and learned friend sits down, in the interests of clarity will he consider making it clear on Report that "client" includes lay client as well as professional client? Some people may think that it is the solicitor only who is their client in this context. It is a point that may be worth making.
Perhaps I may also take the opportunity to welcome subsection (2). Without it, everyone would have been in real difficulties because it would be said that the will of Parliament is not only that the
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rule should be abrogated but that there should be a positive right to make a contract. The subsection makes it clear that the Bar Council is free to decide. I welcome the subsection.
The Lord Chancellor: I am grateful to my noble and learned friend. The whole idea of the clause is to preserve subsection (2). Subsection (1) merely gives the additional right to barristers, over and above what they have at present, if a rule of law such as the clause deals with exists. I shall consider whether we need to make the point plain. I had taken it that "client" would include the lay client. I shall take advice as to whether we can clarify the point.
Clause 46 agreed to.
Clause 47 [Immunity of advocates from actions in negligence and for breach of contract]:
Lord Allen of Abbeydale Lord Allen of Abbeydale moved Amendment No. 198:
Page 37, line 14, leave out ("barrister") and insert ("authorised advocate").
The noble Lord said: I should like to speak also to Amendments Nos. 199 and 200. I do so with rather greater enthusiasm than I managed to muster for the earlier amendment that I moved about conditional fees.
The effect of the amendments is to put an end to the immunity from liability for negligence which barristers enjoy in relation to advocacy in court. The clause, as at present drafted, extends that immunity to the new advocates provided for in the Bill. Solicitors are already covered. Incidentally, in doing so it defines the existing rule of law in rather wider terms than I had understood it to be. That, however, is a separate point not to be pursued in the present context.
The rule of law in question is one for which the judges were responsible, and this could well be the first time that that issue has been considered in the context of legislation before Parliament.
It would be possible to speak at great length about the amendment, but the main arguments can be summarised briefly. I am not a lawyer and perhaps I shall be forgiven if I get some of the technical terms wrong. If a barrister or solicitor appearing as an advocate in court on his client's behalf is guilty of negligence, there is nothing the client can do about it. He is entitled to no kind of redress or compensation no matter how dire the consequences are to him. If a barrister settles his client's case at the door of the court for a derisory sum in order that he can get rid of that case and free himself for something much more lucrative, he remains immune from any proceedings against him.
In a leading case in Canada, a plaintiff counsel failed to turn up at the trial and sent along an inexperienced replacement who failed to call vital evidence. The leading case here, which was settled in this place —Rondel v. Worsley —established that the rule was justified as a matter of public policy and not, as I had once thought, because there was no contract between barrister and client.
There seem to be two main arguments. The first is that the barrister needs to conduct his duties fearlessly and independently and that in doing so he must put his duty to the court —for instance, not to mislead —before his duty to his client, something we have already heard referred to on a number of occasions today. The client as a consequence may well feel aggrieved, but it seems to me unthinkable that if he brought an action any barrister could be found negligent for giving priority to his duty to the court.
The second argument is a point of more substance; that is, the risk of relitigation, having to go over the original dispute afresh in the courts. I can well see the force of this argument. But relitigation of a kind already takes place in the appeal system and, anyway, it seems to me that it is a lesser evil to make it possible for a grave injustice to be put right than for a client who has suffered an injustice to be left with no remedy. As Mr. Justice Krever concluded in the case in the Ontario High Court to which I referred just now, it seemed to him better that relitigation should occur than that the client should be left without recourse.
The disincentives to any aggreived client taking proceedings are quite considerable. He will be faced by a trained lawyer and the issues will be decided by the professional colleagues of that laywer. He would find it difficult to get legal aid unless it was thought his case was strong, and the welfare litigant who mounted a case which was found to be vexatious or frivolous could have it struck out.
The immunity of advocates is not universal. It does not exist in France, Germany or Belgium, without, so far as I know, any major difficulty having arisen; and in Ontario, to which I have already referred, there have been quite a number of cases establishing that it does not apply. To be fair, it applies in Australia following their understanding on a majority decision in a criminal case, and it applies in New Zealand, but I believe that it does not apply in the United States.
As your Lordships will be well aware, it applies to no other profession here. The surgeon, the anaesthetist, the constructional engineer and all the others are liable to claims for negligence. I have some sympathy with my noble and learned friend Lord Oliver of Aylmerton, who I am sorry is not here. When we were discussing the advisory committee earlier in the proceedings on this Bill, he asked why the legal profession in that context should be treated differently from all other professions. This amendment poses a similar question.
There are undoubtedly arguments both ways, but it certainly seems to me that on a balance of the arguments the case for putting an end to the immunity rule comes out much the stronger. It is not easy to reconcile its continued existence with the objective of this Bill of ensuring that there are no obstacles to access to justice. I beg to move.
6.45 p.m.
Lord Simon of Glaisdale: The immunity rule does not stand alone in respect of lawyers. The attitude
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of the law is consistent throughout only to give immunity so far as it is necessary in order that the person given the immunity should perform his duty to the public, and it is very narrowly drawn. For example, an ambassador at common law is immune from suit. It may be that certain people would find it difficult to bring suit against him, but the public interest demands that he should not be plagued by actions at law. But it is very narrowly drawn. The ambassador is only immune when he is in post and for a reasonable time thereafter.
So too with judges and so too with arbitrators. A judge is given immunity only in so far as he is performing judicial duties, because he could not perform them adequately if he was consistently worried about whether he was subject to suit. It is the same with an arbitrator. He is given immunity only in so far as he is carrying out his official duties. It is the same with an advocate. He has a supervening duty to the court. That may be very irritating to the lay client, as it was in Rondel v. Worsley. My noble friend said it was very unlikely that a suit could be maintained, but it was in Rondel v. Worsley and indeed it was fought up to the House of Lords.
So public interest demands that just as the judge and the arbitrator are protected, so the counsel, the advocate, is protected from suit altogether while he is performing duties where he has a supervening duty to a court; but no further than that. If he is negligent in writing an opinion in chambers, for example, he enjoys no immunity. The immunity as in the case of ambassadors, as in the case of judges and as in the case of arbitrators is very narrowly drawn, and those who read the judgment in Rondel v. Worsley and the cases which followed, such as Aronson, for example, will see how very narrowly it is drawn and how necessary within those limits it is on the grounds of public interest.
It is simply no good saying that a suit is likely to fail against a barrister, against a judge or against an arbitrator. Rondel v. Worsley showed that a discontented litigant is quite ready to have a go. So I hope that my noble and learned friend will not accept this amendment, which is an amendment to subsection (1).
Subsection (2) seems to me to follow directly from the fact that this Bill now creates a contractual relationship between an advocate and his client, and it is absolutely necessary, although I quite understand that my noble friend will wish it to go if he succeeds in saying that the immunity rule is hereby abolished.
Baroness Macleod of Borve: A few lay people have the opportunity of addressing noble Lords in this Committee stage of this very important Bill. Before starting I should like to pay a very deep tribute to all the people who have taken part in the proceedings on the Bill. I have learnt a great deal, but I listened with a great sense of not being as clever as I perhaps hoped I might have been when the noble Lords addressed us at all stages of this Bill, led by my noble and learned friend the Lord Chancellor. Their speeches have been impressively brilliant. However, in view of the essential qualities which the noble Lord, Lord Hutchinson of Lullington, described to

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us last week, it is obvious that advocates who are members of the Bar are exceptionally brilliant and talented men and women.
Clause 47 defines the existing rule of law by which advocates are immune from liability for negligence in relation to advocacy in court. Subsection (2) extends that rule in such a way that it provides immunity not only for lawyers acting as advocates but also for lay persons to be given new rights of audience under Clause 8. As we all know, there is to be a big and welcome change under Clause 8 in which only exceptional people of high quality will be able to obtain rights of audience and represent their clients in the higher courts.
In view of what I have said about the brilliance of the learned members of the Bar, perhaps it does not come amiss that it seems to me that because of their brilliance they have no need to claim immunity. It does not seem to me that one goes with the other. The Consumers' Association, with which I have been in touch, has had wide experience in the small claims court through the service known as the "Which Personal Service". The association is against all immunity for all advocates. As the noble Lord, Lord Allen, said, and as I am advised, this is the only profession which claims immunity. That seems quite extraordinary. I sincerely believe that the top people in this country should not avail themselves of the opportunity to hide, as some people might say, behind the skirts or trousers of immunity. They should have the courage of what they say, knowing that they are right. I follow the noble Lord, Lord Allen of Abbeydale, in asking the noble and learned Lord the Lord Chancellor to forgo the immunity for all advocates in our courts.
Lord Ackner: I respectfully agree with the noble Baroness that there is some cause for anxiety that the Rondel v. Worsley immunity is to be extended outside the field of the qualified lawyer. This is an old refrain because one of the most intolerable aspects of the whole Bill is the bringing into the courts, either as an advocate or later as a judge, a person who is not the lawyer obliged, by the discipline of his profession, to adhere to imposed and accepted rules.
Rondel v. Worsley runs to 104 pages. I have a photostat of the judgment here. I know that Members of the Committee hope shortly to adjourn so I shall make but a few references to it. I wish to refer in particular to the anomaly which the legal profession enjoys. It comes in the speech of Lord Pearson which is to be found at page 273:
"Great stress is laid on the argument that the immunity of the advocate is 'anomalous' to other professions. But the whole judicial process is anomalous to other professions. It is a thing on its own. It is a unique and important process of the community. The various ingredients of it —"
I shall refer to them in a moment —
"are immune in respect of the occasional hardships they may create by any failure on their part. And even the Press which is not part of it but which performs a service in respect of it shares this immunity. It can just as well be said that it would be an anomaly to make the advocate, alone among the other ingredients, liable for his failure in the judicial process. In truth, the facile use of the word 'anomalous' does not advance the matter".
In the five ingredients, Lord Pearson was referring to the parties, the witness, the judge, the juror and
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he added the advocate. All those are Immune from a variety of other possibilities of claims: claims on the basis of perjury, incompetence, negligence and the like.
In many ways I am grateful to the noble Lord, Lord Allen of Abbeydale. I shall refer again to these judgments at the Report stage. Each and every one emphasises the importance of the cab rank principle and how vital it is to the administration of justice. I believe that in this Committee it has not yet been properly emphasised.
Lord Mishcon: I wish briefly to explain to the noble Baroness in simple language two reasons why a somewhat illogical-looking rule must apply for the public good. The first one is that if there were no such rule, in order to protect himself the advocate would have to quote every point that might have been made in a brief; and, worse still, every point that a client has asked him to put forward, even though the barrister knows perfectly well that to put forward some of those points might be inimical to the interests of the client. That is the first reason among many.
The second reason is that if one sues an advocate for negligence in the conduct of a case which he has lost, inevitably the case has to be retried. That is obviously undesirable and contrary to public policy. The case has to be retried in order to see whether there could or would have been a different result from that which the advocate achieved. My purpose in rising was only because I well understand how those who are not lawyers and who are Members of the Committee may think that this is a most unfair example of immunity and privilege which is given to advocates.
I rise for another reason. It may be that as a result of my ignorance—and if so the noble and learned Lord the Lord Chancellor will point it out to me in his usual gentle way —I had always thought that the immunity was limited to an advocate performing the duties of an advocate at a trial. Clause 47(2) contains the words,
"in relation to proceedings or contemplated proceedings".
I thought that that might give rise to a great deal of misunderstanding as to whether or not the immunity rule is not as it was but is extended by the Bill. I cannot imagine that the noble and learned Lord intended in this clause to cover, for example, the opinion of counsel who —and I emphasise this—neglecting certain facts that were given in his instructions and also neglecting certain principles of law of which he ought to be aware, gave advice in contemplated proceedings that the plaintiff has no case. That might be an opinion which is absolutely negligent. Those would be contemplated prodeedings. Normally contemplated proceedings never get near a court for there to be any advocacy.
There might be the odd case of somebody intending proceedings and asking leave of the court to serve out of the jurisdiction or matters of that kind, or asking leave to issue a writ out of the jurisdiction. But these are cases which are obviously exceptional. Therefore I ask the noble and learned Lord whether these words, "or contemplated

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proceedings" come into the Bill inadvertently or are covered by some matter of which at the moment I am ignorant.
Lord Renton: We can again take refuge in the Notes on Clauses which are absolutely clear and succinct. They state that the intention of the clause is to extend the immunity to new classes of authorised advocate and authorised litigator and to those exercising rights of audience or the right to conduct litigation by virtue of directions made by the Lord Chancellor under Clause 8. I should remind the Committee that that clause is in Part I and it is the clause which deals which people who will be given the right to pursue small claims on the part of creditors. That is what the Notes on Clauses states.
7 p.m.
Lord Mishcon: I must not jump up and down. I promise the Committee that this is the last time I shall jump up. After this I shall sit down. However, I was dealing with the phrase "contemplated proceedings". Even if this measure now extends to a body of people whom we would not have contemplated but for the Bill, I was asking whether in any circumstances advocacy could or should cover from a practical point of view contemplated proceedings. That means proceedings which have not been started yet.
The Lord Chancellor: The purpose of this clause is to apply the existing rule of law only to advocates, whether they be barristers or solicitors or persons who act as advocates under Clause 8. It is the existing rule of law only that is being applied because we have defined the immunity rule as any rule of law which confers immunity from liability for negligence in respect of any act of omission. So in order to find out what the immunity is one has to go to the existing law which tells one what it is. There are cases in which the stage at which the immunity applies has been determined. I have no wish whatever to disturb those or enter into an attempt to define what they say. Therefore, I have used the expression "the immunity rule" as referring to the existing law. I hope that that is reasonably plain.
On the question of principle, however, the first point I have to make is that I believe that the principle reason for the immunity is in order that the integrity of public justice is maintained. The passage in the speech of the late Lord Diplock in a case called Saif Ali v. Sydney Mitchell & Co. puts these matters clearly. The noble Lord said:
"The retrial of the issue in the previous action if it depended on oral evidence would have to be undertaken de novo. This would involve calling anew after a lapse of time witnesses who had been called at the previous trial and eliciting their evidence before a different judge by questions in examination and cross-examination that were not the same as those put in the previous trial. The circumstances in which the barrister had made decisions as to the way in which he would conduct the previous trial and the material on which those decisions were based could not be reproduced in the retrial. The initial question in the action for negligence on whether it has been established that the decision adverse to the client reached by the court in the previous trial was wrong would become hopelessly entangled with the second question.
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It seems to me that to require a court of co-ordinate jurisdiction to try the question whether another court reached a wrong decision and if so to inquire into the causes of its doing so is calculated to bring the administration of justice into disrepute".
That is the reason for the rule that I found my case on. However, as my noble and learned friend Lord Simon of Glaisdale said, there are other reasons as well.
This matter was also considered in the High Court of Australia in the case of Giannarelli v. Wraith, and Shulkes v. Wraithe on 13th October 1988. Much the same reason was given by the Chief Justice. It was a rather narrow decision at four to three but the decision of the court was in favour of maintaining the rule. The Chief Justice said:
"The second aspect of public policy that calls for attention is the impact on the administration of justice of allowing court decisions to become the subject of collateral attack by means of actions against counsel for in-court negligence. Exposure of counsel to liability for such negligence would unquestionably encourage litigation by unsuccessful litigants anxious to demonstrate that, but for the negligence of counsel, they would have obtained a more favourable outcome in the initial litigation. That would be the central issue for decision in secondary litigation of this kind. If the plaintiff were to succeed, the resolution of this issue by a different court and on materials which might well differ from those presented in the initial litigation, due to lapse of time or other reasons, would undermine the status of the initial decision. Yet an appeal against that decision might not succeed with the result that it would stand, though its status would be tarnished by the outcome of the collateral proceedings. The impact of a successful challenge to a criminal conviction resulting in a sentence of imprisonment would be all the greater. It would be destructive of public confidence in the administration of justice. And for this very reason there would be a strong incentive on the part of a disappointed litigant to sue counsel for negligence as an indirect means of calling in question the decision in the initial litigation".
We raised this matter in the consultation and there was a difference of opinion in that the consumer bodies, as the noble Lord, Lord Allen of Abbeydale, and my noble friend Lady Macleod of Borve indicated, were in favour of doing away with the immunity. However, I think it is of particular importance that the Association of British Insurers which, assuming this immunity were to be taken away would have a new line of business, agreed that immunity from actions in negligence should in the future extend to all recognised advocates. Therefore that body believes that the rule has a proper place. I believe this rule is an appropriate one. We placed it in the forefront of consultation right from the start and I believe it is right that we should adhere to it.
Lord Mishcon: Will the noble and learned Lord clarify the point about contemplated proceedings, if only to put me in my place?
The Lord Chancellor: I believe I started with that point. I started by saying that the rule of law is the immunity rule which exists at the moment. The question of where the immunity starts in relation to a particular matter has already been decided. I do not wish to reopen that question. It is necessary to cover the matter of contemplated proceedings because the question may arise of how far along the road the matter has gone. That is why we use the phrase "contemplated proceedings". I am using it solely to make it clear that we are not making any change to the existing law and that that law continues as it was.
Lord Hacking: I am sorry to interrupt the Committee after the noble and learned Lord has spoken but I continue to have concern about the drafting of Clause 47(2). I heard exactly what the noble and learned Lord said about not intending to extend immunities. However, if one applies that practically against a member of my side of the profession, in the case of a failure to issue a writ within the limitation period or of conducting a litigation so slowly that it is struck out for want of prosecution, within the wording of Clause 47(2) both of those instances would seem to apply. That certainly extends the immunity.
The Lord Chancellor: The measure would not apply in those circumstances for the reason that they do not come within the immunity rule which is referred to in Clause 47(1). The immunity rule would not cover those matters and therefore nothing in any of the other clauses extends the immunity rule. It simply gives the subject matter to which the immunity rule may apply. However, as the immunity rule does not cover the matters the noble Lord referred to, nothing else brings it in.
Lord Mishcon: I rise for the last time and I do it only in order to extend what I have said and not to repeat what I have said. I know that the noble and learned Lord will consider, as he always does, the fact that these Acts of Parliament are read by lay people who ought to be able to understand them. No layman who read Clause 47(2), not knowing the abstruse ruling that was given in the cases to which the noble and learned Lord referred in regard to the immunity rule, would understand that contemplated proceedings came within the immunity rule which deals with advocates who are dealing with the matter at a trial. It may very well be that the immunity rule needs to be spelt out more clearly in the Bill or that some alteration has to be made to the wording. I merely ask the noble and learned Lord to consider the matter before Report stage.
The Lord Chancellor: I shall certainly consider the matter. I have sometimes found that non-lawyers in this Chamber find it easier to understand what I intend in the clauses than some of those who are not laymen. However, I shall take account of what the noble Lord has said.
Lord Coleraine: Having listened to what the noble Lords, Lord Mishcon and Lord Hacking, have said, I believe that there is one respect in which my noble and learned friend might consider the matter again, because it is misleading. Perhaps he would consider the possibility that Clause 47(1) might read:
"The provision by him of legal services by way of advocacy in relation to proceedings or contemplated proceedings".
The Lord Chancellor: I have considered carefully whether I should attempt to restate the immunity rule. Having studied the cases I have concluded that that would be rather unwise. Therefore, I thought it best to take the rule as it stands and allow the judges to develop it, not attempting to formulate or reformulate it in any way. However, I shall certainly consider whether anything can be done to eliminate
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the misunderstanding into which the noble Lord, Lord Mishcon, appears to have fallen.
Lord Allen of Abbeydale: In my opening remarks I said that I thought that the rule of law had been defined too widely. The noble Lord, Lord Mishcon, pursued that point. However, it appears not to arise in connection with my amendment in which I propose to delete the rule of law altogether. We seem to have strayed into a discussion on clause stand part.
Perhaps I could bring the discussion back to the amendment under consideration. I am a little disappointed in that I have heard no new arguments from the lawyers who have spoken to add anything to my previous knowledge, except possibly for a reference to judges and arbitrators by my noble and learned friend Lord Simon of Glaisdale, the relevance of which escaped me. I have read Rondel v. Worsley—page after page of it. It is beautifully phrased and carefully developed. I fear that I still find it unconvincing. I am comforted by the knowledge that a substantial minority in the Australian case to which the noble and learned Lord referred and a majority in some of the Canadian cases which I have looked at have also found it unconvincing.
I do not want to test the opinion of the Committee tonight. I should like to read carefully what has been said and consider it. I reserve the right to return to the matter at a later stage if need be. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 199 and 200 not moved.]
Clause 47 agreed to.
Viscount Ullswater: I believe that this would be a suitable time to break for dinner. I suggest that the Committee stage does not begin again before 8.30 p.m. I beg to move that the House do now resume.
Moved, That the House do now resume. —(Viscount Ullswater.)
Lord Simon of Glaisdale: Perhaps I may ask the noble Viscount how late it is proposed that the Committee should sit tonight, or tomorrow morning. When the Committee began today we had dealt with just over half the number of clauses in the Bill. It is fair to say, however, that the Committee had also dealt with some substantial schedules. However, there is one large schedule —Schedule 7 —to come. What is more, there is an amendment of considerable constitutional importance down for a very late clause, Clause 82. That amendment raises the question of the Henry VIII clauses and what should be proper parliamentary control.
As Members of the Committee know, a Henry VIII clause is a clause empowering the Executive to repeal, modify or amend a provision of an Act of Parliament. That represents an age-old struggle between Parliament and the Executive. In the famous words that have been used, that was the cause for which Hamden died in the field and Sidney on the scaffold. It is highly undesirable that this Chamber should have to deal with such a matter in

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the early hours of the morning, particularly when annexed to it is the question of whether the affirmative or negative resolution should be applicable to such provisions.
Moreover, I understand that the intervening business will take longer than an hour. The noble Lord the Lord Privy Seal is present. He said, very reasonably, that he would consider how the matter went. Inevitably we had a long debate on Clause 44, although there was considerable self-abnegation in discussion of that clause. We are now only at Clause 47 and there is a great deal to discuss. There is certainly two days' business ahead. I ask the noble Viscount or the noble Lord the Lord Privy Seal to say that an extra Committee day will be vouchsafed.
Lord Belstead: Perhaps I may reply to the noble and learned Lord, Lord Simon of Glaisdale. The noble and learned Lord was good enough to write to me today to warn me that he would raise the matter, probably at this hour.
There are two points that I should make. The first is that early on in the proceedings on the Bill some perfectly reasonably points were made about how the amount of time allocated to the Bill in Committee compared with other legislation considered previously by your Lordships' House. The Children Bill was mentioned. The moment has come for me to make it clear that we are now proceeding through a sixth day in Committee on the Bill. That is an additional day compared with the Children Bill in the last Session. As many Members of the Committee will remember to their cost, that was a Bill to which hundreds of amendments were proposed. As we have gone along we have agreed through the usual channels to allocate first a fifth day and then a sixth day.
Therefore, the second point I should like to make is that at the end of this sixth day we should reach the point agreed by the usual channels, namely, the end of the Marshalled List. If we do not do so Members of the Committee will be at a disadvantage, finding that they would have to continue with the Bill on a day which they had not catered for in their diaries.
To revert to my first point, as Leader of your Lordships' House I feel that we are being reasonable. We have an additional day compared to the enormously long proceedings on the Children Bill. I hope that that means that we shall not have to go too late tonight.
House resumed.

Irradiation of Foodstuffs: ECC Report
7.18 p.m.
Lord Middleton Lord Middleton rose to move, That this House takes note of the Report of the European Communities Committee on Irradiation of Foodstuffs (4th Report, HL Paper 13).
The noble Lord said: My Lords, in asking your Lordships to take note of the Select Committee's report on irradiation of foodstuffs I am well aware that we are moving on to ground that has been well trodden. Of 23 noble Lords who took part in the Second Reading debate on the Food Safety Bill, 15 spoke about irradiation although the word did not appear in the text of the Bill. When the House was in Committee on the Bill on 18th January discussion on that subject filled no fewer than 25 columns of the Official Report. From the attention it has received both in this House and outside, it is clear that, like all matters of food safety, it is exercising the minds of many noble Lords and of the public generally.
During the past few weeks, my noble friends Lady Hooper and Lady Trumpington have spoken fully and frequently in this House, explaining and justifying the Government's plans for legalising irradiation.
Before I deal with the report itself, I should like to refer to the research which lies behind the Commission's proposals regarding the use of irradiation in the European Community. Running through the debates in this House and outside is the charge that not sufficient scientific work has been done to justify establishing the process in the United Kingdom as a means of enhancing food safety. In Committee, the noble Viscount, Lord Falkland, said that it was,
"not desirable at this stage to proceed with the introduction of irradiated food until there has been an independent scientific survey". —[Official Report, 18/1/90; col. 763.]
On the same day in col. 764 the noble Earl, Lord Baldwin, said:
"We do not seek to ban irradiation. We say, please do some work on it".
As we say in Part 2 of the report, ionising radiation was first suggested in 1896. In the 1950s studies were made here and in the United States with laboratory animals. In the 1970s research was carried out under the aegis of the Food and Agriculture Organisation, the World Health Organisation and the International Atomic Energy Authority which led to reports on the wholesomeness of irradiated foods in 1976 and 1980. After considerable work, the Commission's own scientific Committee on Food reported in 1987. In 1982 our own Government set up the independent Advisory Committee on Irradiated and Novel Foods, which reported in 1986, agreeing with the findings of the FAO, the WHO and the IAEA Committee. In 1987 they reported again. Research into methods of detecting irradiated food are in progress now. That adds up to a substantial amount of scientific work —more, I have heard it said, than has gone into any other form of food treatment.
Sub-Committee D began its inquiry into the Commission's draft directive last summer and during the whole of our work we had the benefit of the great knowledge and experience of our specialist adviser, Professor Bevan Moseley, head of the Reading Laboratory at the AFRC Institute of Food Research. In addition to hearing witnesses here, we also visited Holland where we spoke to food scientists and to Dutch Government officials. We visited a Dutch irradiation plant in action. The

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sub-committee also visited the British food manufacturing industry's research laboratories in Leatherhead where members tasted a number of samples of irradiated food.
The main thrust of our report is to give cautious support to the use of food irradiation. As I have said, the process has been extensively researched and the general consensus of the research is that it is safe. We accept that consensus, though we are conscious of the need to assure the consumer of that fact. We therefore stress the need for further research in some areas and for continuing monitoring of the process, particularly of its nutritional effects since, like most other forms of food processing, irradiation increases the loss of nutrients in foods.
I do not agree with the argument that calling, as we do, for further work is inconsistent with accepting the overwhelming weight of evidence that irradiation of food on the limited basis proposed by the Commission is safe. As we say,
"the process must remain subject to constant scrutiny and re-evaluation like any other technique".
Irradiation has several purposes, but the main effects are to decontaminate foods by killing potentially dangerous bacteria such as salmonella, listeria or campylobacter, and to extend the shelf or storage life of foods by killing insects and spoilage organisms.
Some witnesses have argued that irradiation is not really needed to reduce the level of bacteria in foods. According to that reasoning, bacteria are only present because of sloppy production and processing standards. It is said that irradiation would merely allow manufacturers to continue to evade their responsibility by cleaning up what was a sub-standard product. Other witnesses pointed out that there is little enthusiasm amongst anyone for the use of irradiation to extend storage or shelf-life, and that the freshness of food is a major selling point.
We agree with the second point of view, but not with the first. We think that it is an unavoidable fact that modern food processing techniques will lead to some products containing potentially high levels of contamination. We therefore support the use of irradiation as an additional means of raising food safety. To the charge that such a state of affairs means that food processing techniques should be improved, we say that that is precisely what irradiation would do. Its introduction would be a means of improving food processing technology. However, as we say, irradiation must not be used as an excuse for any relaxation of the present hygiene and handling requirements in food manufacturing or processing.
We think that there is a public health justification for the introduction of irradiation. We do not however think that irradiation should be allowed without specific criteria for the approval of each food which manufacturers wish to irradiate. We think that those criteria must involve the evaluation of other methods of food processing and that irradiation should be approved only if it represents an advantage to the consumer over those other methods.
Because irradiation in small doses affects the appearance and texture of some foods so little, it is extremely difficult to detect whether a food has been irradiated. Research on that point is continuing and detection methods may be available within a few years, or less. Nevertheless, the absence of such a method makes consumers—already probably wary of a process which involves irradiation —very suspicious of the process. We therefore emphasise that if irradiation is allowed its use must be closely controlled. These controls should include the stipulation of maximum and minimum dosage levels, the banning of reirradiation, except for ingredients included in compound foods, and requirements over the use of packaging materials.
The Commission has proposed controls on irradiation plants based on the internationally accepted Codex Alimentarius recommended standards. We endorse those and we attach a great deal of importance to that area of control. We support the Commission's proposals that irradiated foods should be labelled as such from the moment they leave the irradiation plant. We recommend that irradiated ingredients should also be labelled, whether or not they are currently required to be listed on product labels. We think that the most pressing applications of irradiation are for herbs and spices, poultrymeat and shrimps and prawns.
The Commission suggested that initially irradiation should be approved for eight classes of foodstuffs, including herbs and spices, shrimps and prawns and deboned poultrymeat. The committee makes the comment that there is no scientific justification for such a limitation, and recommends that "all poultrymeat" is substituted for "deboned poultrymeat". But on the whole we thought that an initial limitation on the use of irradiation would be a good thing. It would help consumers to get used to the process and enable the control and regulatory framework to be established.
Lastly, we examined the consequences of permitting irradiation. The committee considers that it is unlikely that irradiation will be widely used for some time because of its great expense and doubts about the likely demand from consumers. However, irrespective of that fact, we think that it would be desirable for the Government to try to ensure that consumers are better educated about the issues. The Government have said that they will talk to consumer groups about developing an education programme. The committee endorses that approach.
On the matter of timing, it was noted that the Government are still maintaining the option to permit irradiation in this country before the Council agrees the draft directive. In accordance with the committee's cautious approach, we believe that it is essential to have a Community framework for the regulation of irradiation. The committee therefore concludes by recommending that the Government postpone their detailed plans for allowing and regulating the process until the directive is agreed. I beg to move.
Moved, That this House takes note of the Report of the European Communities Committee on Irradiation of Foodstuffs (4th Report, H.L. Paper 13). —(Lord Middleton.)
7.32 p.m.
The Earl of Halsbury: My Lords, in speaking second I shall try to set a good example of brevity. I do not know whether to congratulate the committee or sympathise with it. I congratulate it on a job well done and sympathise with it for having had to explore so many blind alleys in the face of overwhelming evidence to the contrary.
The Leatherhead food research association and the Scientific Committee on Food were mentioned. What have they been up to for all these years? Why do we have to wait on Europe to have safely irradiated food? Legislation is a batch process from time to time. The process of science and technology is a continuous process and legislation always lags behind science. Knowledge is always ahead of the law.
Is there then no domestic legislation of a subordinate character, by statutory instrument, to enable the present law to implement the recommendations of the committee? If not, I ask the noble Baroness who will reply for the Government whether it is contemplated putting something in the way of an enabling clause into the Food Safety Bill so that food safety can be kept up to date in the light of science without requiring extra legislation and parliamentary time.
There are two matters —to my mind, minor —that I like to think would bring common sense to bear upon the conclusions of the committee. One concerns the fact that packaging materials may acquire a bad smell if they are irradiated. In that case I recommend to noble Lords that they do not buy products in that particular type of packaging. I cannot believe that people would package their product, then irradiate it and give it a bad smell. I do not see a commercial future in that. I should have thought that common sense would come to the rescue there.
My second point relates to a recommendation by the committee that catering outlets should be brought under the scope of the law and have a logo. I may go into a pub and order half a pint of bitter and a ham sandwich. How can one put a logo on a ham sandwich? I simply do not know. No doubt were I to dine at Claridge's every single item on the bill would have a logo on it. From that point of view, I cannot pay much attention to that suggestion.
I have said what I had to say in two minutes. I hope that it will be sufficient.
7.34 p.m.
The Viscount of Falkland: My Lords, I commiserate with the noble Lord, Lord Middleton, in that the excellent report from the Select Committee of your Lordships' House should be squeezed into such a short time between other business. I came to this Chamber principally to learn. As noble Lords know, we discussed this matter to a certain extent in the preliminary stages of the Government's Food and Safety Bill. Noble Lords held themselves back, if I may use that expression, in order to learn more from the members of the committee. I am disappointed that there should be so few of that committee here tonight. Nevertheless,
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the noble Lord, Lord Middleton, has introduced the report in a most eloquent and concise way.
I do not exaggerate when I say that there is enormous concern throughout the country. That concern may be misguided and centred on certain parts of our society. I do not assert that everyone goes about business every day with a worry in the back of the mind about the irradiation of food. That certainly is not so. But there are groups of people—particularly, if I am to judge from the amount of correspondence that I have received in the past few weeks, women and women with children —who are especially concerned about the introduction of this technology. However, I have never heard anyone condemn it outright. The general trend is to say, "We just do not know enough about it"
We accept that irradiation has been around for a long time. It has been used satisfactorily in areas other than food. However, the Government now propose to introduce the possibility of irradiated food to be consumed in this country and indeed imported into this country through the mechanisms of the regulation procedures in Parliament. That has given rise to some concern because, in the absence of knowledge about the process, it seems to many people that this way of going about things does not allow for adequate debate.
Most of the questions which people first ask centre around why the process is required in the first place. The Government say that it is based purely on food safety grounds. That is said against a background of fairly alarming developments in this country over recent years culminating in very high levels of food poisoning over the past 18 months.
I do not say that food safety in this country has deteriorated but there is no doubt that patterns of consumption and habits of cooking have changed. I read in one newspaper that we have been transformed from a larder society into a microwave society. The implication is that people pay less attention to buying the ingredients and the preparation of food than they did even 10 or 20 years ago. People are buying convenience foods which are quickly prepared and they rely more on the information on the label of the foods that they buy in supermarkets rather than on the housewife's prudence which is still to be seen in some other countries in Europe. It is to be seen in Italy, for example, where I have observed that the introduction of irradiated food is certainly not something which at this stage would be very welcome, certainly not in the way that it is proposed to be introduced here.
Another matter of concern is how this process can be controlled. The report mentions the lack of a detection test. The committee nevertheless considers that there is every justification for introducing this process without the certainty of a detection test. But how, then, can we avoid the potential for misuse of this process? I do not think that we should take that matter too lightly. I hope that I shall not be accused of being either political or alarmist in mentioning that particular point.
Many people—I dare say they include Members of your Lordships' House —are concerned about the

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potential for misuse. We are told that it is unlikely that any cheap or reliable test can be developed in the near future. I ask the noble Baroness who will reply to this debate whether the Government are committed to establishing a reliable and economically viable test or whether they regard it as unnecessary.
The noble Lord, Lord Middleton, said that the consensus of opinion is that this process is safe. That implies that it is not absolutely safe. During the early stages of the Food Safety Bill, I gathered from the noble Baroness on the Government Front Bench that the Government's attitude is that if it is not absolutely safe it is as near safe as can be. I very much welcome further amplification on that. When I turned on my television set last week it was a great pleasure to see the noble Baroness. For some reason she was cut off when she was talking about irradiation. It seemed that the discussion did not develop. Perhaps she was relieved about that. I found it disappointing because I wished for her to amplify the Government's view as I understand it, about the safety of this food.
It is surely absolutely vital for consumers to know whether the food that has been irradiated was, in its initial stage, wholesome. It seems to many people that if food is wholesome one does not need an irradiation process. But what about hidden hazards which irradiation could undoubtedly conceal? Perhaps the Government do not agree with my word "undoubtedly". Many people believe that there is a concern here. Bad fish apparently does not give off its usual warning smell when treated by this process. I am told —perhaps others better informed that I am will mention it —that there is increased risk of botulism. Botulism might flourish in conditions where competing micro-organisms have been destroyed by irradiation. Are the Government certain that the problem has been correctly and thoroughly addressed?
We now move to what is an even more worrying aspect of the condition of food before it is irradiated. I suppose it is certain that irradiated foods will be allowed to be imported into this country. What controls shall we have over imported food, such as sea foods from Asia? There is a well-recorded case that I do not wish to go into in any detail. At the Committee stage of the Food Safety Bill I mentioned various cases on record where unsafe foods have been treated with irradiation. Attempts have been made to pass these through stringent tests in order to put them on the market.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington): My Lords, at the Committee stage of the Food Safety Bill I asked the noble Viscount for the source of his information. I do not think that he answered me then. He read me a lot of stuff at the end but I do not think he gave me the source. Would he be so good as to do so now?
The Viscount of Falkland: My Lords, I gave the source and it caused a certain amount of exhalation of breath and muttering on the Government Front Bench between the two noble Baronesses. It was the
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London Food Commission. It has again caused a great deal of mirth and amusement on the Government Front Bench. I do not know what there is about the London Food Commission. However, I have received some fairly sensible-looking papers from this body. Perhaps I am misled about it. Perhaps we are dealing with people who are pretending to be what they are not. However, I have checked the cases that they have given me which have led to court action. They proved to be correct in every case.
I did not mention one well-known British company that had found a consignment of Malaysian prawns to be unsafe. They had been treated in Holland by the irradiation process. It was then sought to market them illegally in the United Kingdom. That was fully admitted. The one case has caused an enormous amount of concern. If this occurs when such importing is not allowed, what will happen when it is perfectly legal to import irradiated food into the country?
Do not let us forget that the food business is a very large business with large amounts of money changing hands. Even without irradiated food, there is an enourmous amount of petty corruption in every country, not just this country, over which large companies buy what. There is much pressure on people to buy products, and undoubtedly there are inducements for people to favour one product over another. Doubtless I shall be accused of being alarmist. I should be prepared to bet that in the five years one will have several cases of unscrupulous importers of food seeking to sell into this country unwholesome food that has been treated in this manner in an attempt to hide its original state.
I have spoken for very much longer than the noble Earl. However, I feel absolutely justified in doing so because I believe that I am voicing a concern that is growing in the country. The Government may not agree. They may not care that it is growing; but it is. I feel that it would have been irresponsible for me not to cover the aspects that I mentioned.
There have been two television programmes on the subject of irradiated food. Both have left us —the viewers, the public, the consumers—absolutely where we were at the beginning. On Channel 4 one programme went over a number of aspects of food irradiation including some very worrying events in India. Experiments were made on living people—malnourished children —and after a period of weeks it was found that there were some very worrying effects on the children from eating wheat-based products that had been irradiated. The experiments were stopped. The programme on Channel 4 devoted some 10 minutes to that subject. The "Horizon" programme on BBC 2 appeared to take a different stance. It accepted fundamentally the Government's position and proceeded to support that view. We were therefore left in the dark. The Hyderabad affair —to which I have referred —was not mentioned in the BBC 2 programme. Perhaps I may ask the noble Baroness whether these experiments, and the results of them, have been completely written off as meaningless by the Government. Can she tell us something on that?

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Finally, will the Government take seriously those many organisations which have called for research into the subject of food irradiation? I refer to the British Medical Association, the Consumers' Association, the British Poultry Federation Ltd. and environmental health officers whom I mentioned last time when we spoke on the subject. There are many others, including the European Parliament. How seriously do the Government regard the concerns of these organisations?
I support absolutely the recommendation of the committee which states that it is desirable that the Government wait until we have the European Community directive on this subject. What is the advantage of proceeding before the European Community directive is published? All countries within the European Community can then get together if they feel so inclined, and can proceed in unison. Why do we have to proceed before it is published? I apologise for going over my intended time but I felt that these points had to be made.
7.50 p.m.
Lord Colwyn: My Lords, it had also been my intention to speak on food irradiation during the discussion on Amendment No. 73 of the Food Safety Bill which was before your Lordships' House on 18th January. However, following the intervention of the noble Earl, Lord Halsbury, and the noble and learned Lord, Lord Hailsham, I was persuaded to postpone my remarks until the full debate on the findings of the Select Committee.
Tonight's debate gives me that opportunity, although I too am disappointed that nine members of the Select Committee are not contributing to our debate and I should have wished to hear their opinions. However, I hope that the Minister will be able to take note of our debate this evening, be sufficiently open-minded to reconsider her objection of the argument against irradiation and think again about her statement:
"I am quite satisfied that there is no need to delay the introduction of the enabling provision for food irradiation for any of the reasons set down by the noble Lords".—[Official Report, 18/1/90; col. 771.]
The Select Committee deserves congratulation on its comprehensive analysis and examination of the controvertial problem. I was particularly pleased that they recognised the need for continuing research into and monitoring of the toxicology of irradiated foods. Further, that it recommends that the toxicological implications should be thoroughly investigated before approval is given for the irradiation of any product containing additives.
Among other pro-irradiation statements in the summary of my Members' brief on food irradiation, I see that the WHO and FAO have confirmed that it is a totally safe process. Independent scientists advise that it should be permitted. That may well be the opinion of the WHO and FAO joint expert committees, the UK Government advisory committee and the European Commission's scientific committee on food. However, the advisory committees of the Australian parliament, the Canadian parliament, the European parliament and
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the Danish parliament's consensus committee and the International Organisation of Consumers' Unions take the opposite view.
It is a fact that chemical changes take place in food which has been irradiated. Although there is controversy about how the changes may affect future generations and the people who now eat the irradiated food, some of the changes that occur are harmful. Everyone knows that high energy radiation is dangerous. It can cause mutations, cancer, atherosclerosis, cross linking (that is the loss of tissue elasticity) brain damage and immune system damage. In fact, that is also a list of the damage caused by ageing. The similarity is not coincidental.
Nearly all high-energy radiation causes its damage by creating dangerous, highly-reactive chemicals called "free radicals". If uncontrolled, free radicals can damage proteins, fats and nucleic acids (that is! DNA and RNA; the master and working copies of our genetic blueprints). The most important sources of the free radicals which cause ageing come from the abnormal oxidation and breakdown of fats and the breakdown of hydrogen peroxide.
A healthy individual has control systems for free radicals which include enzymes and natural free radical scavengers such as vitamins C and E. However, they cannot control the free radicals perfectly. Some of them escape and cause damage which can accumulate over the years. Mutations to DNA caused by free radicals are thought to be a major cause of cancer. Free radicals can make blood clot abnormally in the arteries by destroying the body's ability to make prostaglandin. They are implicated in arthritis and the ageing process which makes our tissues less elastic leading to a loss of flexibility, emphysema of the lungs and cerebral hemorrhage. They also cause a pigment accumulation that slowly chokes brain cells to death and results in brownish age spots in our skin.
The UK advisory committee acknowledges that irradiation produces the hazardous free radicals, and that they initiate a chain reaction leading to peroxidation and epoxidation in polyunsaturated fats. The process often continues for several weeks after irradiation. Free radical damage is preventable with a normal intake of the nutrients which provide protection by virtue of their antioxidant activity. These include vitamins A, C, E, B1, B5 and B6 which are mostly contained in the foods which we are being encouraged to eat; for example, white meats such as chicken and fish, in preference to red meats, whole grains in preference to highly-processed carbohydrates and more fruit and vegetables. Of course, they are the very foods that will be targeted for irradiation and all will undergo some degree of damage to essential nutrients.
It is also admitted that irradiation causes damage to many vitamins. Vitamin A and its precursor beta-carotene, the B vitamins riboflavin, niacin, B6, B12 and folic acid, vitamins C, E and K are all damaged by irradiation. Generally speaking, the more complex the food the less it suffers vitamin loss during irradiation. Research has shown that losses of between 20 and 80 per cent. are not uncommon and there are still many gaps in the available scientific data.

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The Select Committee stressed the importance of that in paragraph 50 of its report. In paragraph 51 it continued to say that the nutritional implications of irradiation on vitamins should be monitored by the steering group on food surveillance. It is my opinion that even small losses will be significant for some groups within the population —for example, the elderly, the young, the sick and the poor —many of whose diets are already deficient.
The average European diet contains only about half the vitamin C that the USA recommends as the essential daily intake. When there is not enough fresh fruit in the diet potatoes are the main source of vitamin C. If they are irradiated, as has been suggested, the amount of vitamin C in the diet could be reduced to such significant proportions that the health of those with marginal intakes could be severely compromised.
I know that the Minister will tell me that the vitamin losses caused by irradiation are not significant because they are comparable to those occurring naturally in cooking, storing and other forms of food processing. That is misleading because many of the foods intended for irradiation —such as fruit and vegetables —are eaten fresh and often raw. Comparisons with cooking and storage do not apply.
Some vitamins —for example, B1 and E —actually undergo accelerated losses during storage after irradiation. As one of the objects of irradiation is to increase storage time while retaining the appearance of relative freshness so storage losses will be increased beyond those occurring normally. The food can thus undergo initial losses on irradiation, accelerated losses as a result of longer storage times and then lose further vitamins during cooking. For those consumers who are increasingly conscious about the quality and vitamin contents of fresh foods, irradiation counterfeits freshness and conceals what may be significant losses of essential health-giving nutrients.
There is no dispute that there is a serious problem in the rise in food poisoning outbreaks. There has been a threefold increase in reported cases since 1983 and an estimated 10 to 100 times that number not reported. Even if those defects of irradiation were acceptable the concept of removing microbiological contamination by irradiation rather than preventing it in the first place is illogical.
Much needs to be done to improve hygiene and not only in developing countries. We have recently been reminded of the UK Ministry of Agriculture's meat hygiene division findings: that out of 919 slaughter houses in the UK, the standards in 845 were so low that the meat could not be sold for export to the European Community.
Irradiation is not the answer to those problems. All food has a bacterial content much of which is beneficial. Irradiation does not kill all the different types equally; some are more resistant than others. Therefore, the delicate balance of competing micro-organisms becomes altered. Irradiation destroys yeasts, moulds and the bacteria which give the warning smell when food is going off. Irradiation will create a serious hazard by allowing the more resistant dangerous bacteria to proliferate.
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It has been found that, while storage times can be lengthened with increasing doses of irradiation, the time taken for surviving clostridium botulinum to produce dangerous levels of toxins, for example, becomes shorter. The Government must think again. Despite the extensive examination of the scientific evidence, there are still opposing views from highly respected authoritative bodies. Those different conclusions can be expected when much of the evidence is inadequate, incomplete, inconclusive and in conflict.
In conclusion, I look forward to hearing the noble Earl, Lord Baldwin of Bewdley, and hope that he and the noble Viscount, Lord Falkland, will consider further amendments to the Food Safety Bill at its next stage. They can rely on my support when I hope I shall be able to give some of my own selfish reasons for wishing to avoid irradiated food without the guarantee of a reliable and positive test.
8 p.m.
Earl Baldwin of Bewdley: My Lords, like the noble Viscount, Lord Falkland, and the noble Lord, Lord Colwyn, I thought that we had a somewhat truncated debate on irradiation in Committee on the Food Safety Bill since it was pointed out there that there would be an opportunity to go into the arguments more fully when we discussed the Select Committee's report. Now we find that we are compressed into the dinner hour which is not the ideal time for a subject of such wide-ranging interest. We may be similarly constricted during the one-day Report stage of the Bill. Nevertheless, I shall not take any more time than I have to.
In an attempt to be brief I shall reluctantly skip over the many good features of the report we have before us and say only that I was mostly impressed by its tone and that I agree with a good many of its conclusions. However, I cannot agree with the conclusion that the weight of evidence for the safety of the irradiation process is overwhelming. Since we are short of time I shall concentrate on that one issue. In doing so, I propose to widen the context of the debate.
One of the interesting things to an outside observer of high-powered committees is the extent to which they disagree with each other, both across countries and across time. The Government have convinced themselves that there is no disagreement about the complete safety of irradiated food. My Lords, that is just not so.
An expert committtee reported to the Canadian Parliament in 1987:
"There are some data indicating unusual and unexplained effects … it would be prudent to resolve the remaining questions before proceeding with widespread application of the technology".
In the event, the Canadian Parliament decided not to accept that advice.
In New Zealand in 1987 members of an expert committee were unable to agree among themselves as to the safety of irradiated food. In November 1988 a report of the House of Representatives all-party standing committee to the Australian Government was similarly not prepared to endorse the safety of

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irradiated food and the government accepted its recommendations in terms to which I shall refer later.
The European Parliament's Committee on the Environment, Public Health and Consumer Protection has stated that practically all scientific studies admit a considerable degree of uncertainy about the effects on health. The American Food and Drug Administration does not agree with the joint expert committee of the WHO that no further testing is warranted up to to a dosage of 10 kilograys. The British Medical Association's Board of Science still has reservations about long-term implications for health. Are all those doubts of no account?
The Government talk of "independent" committees being unanimous but I am not sure what they mean. Most of those which I quoted are independent enough. For that matter, how independent is a committee whose chairman and technical adviser have directorships in radiation technology firms? I refer to the UK committee which is constantly quoted in support irradiation; that is, the Advisory Committee on Irradiated and Novel Foods which reported in 1986.
The question of unconscious bias is important and not at all peculiar to this particular subject. In Committee the noble Baroness sought at one point to make a distinction between political and scientific decisions. It would be comforting if such a clear distinction would be made but in fact research is riddled with non-scientific considerations which govern, for example, which projects are to be funded, how they are set up, who pays the piper, how the data are interpreted, what is a socially acceptable safety margin and who referees the resulting papers for publication. There have been genuine worries in that area and it is interesting to note that those reports in favour of irradiation have generally been unreferenced, relying on too many papers not subject to peer review and emanating from behind closed doors.
The interpretation of data is of course crucial. Unfortunately, lack of time prevents me from giving examples but there are certain indications that findings in favour of irradiation may have been accepted more uncritically than those against. I am afraid that the purity of science is a myth however much one may wish to believe that scientists shed their human foibles when they don their white coats.
I shall mention two sources of unconscious bias in this case. The first is the close involvement of nuclear interests, most noticeably in the joint committees with the WHO. The other is the simple fact that scientists want to practise their science. To go ahead with the use of this technology represents progress in scientific terms and is almost irresistible. I must stress that I am not impugning people's integrity. These matters are at a very deep level and we are none of us immune.
No review or committee report can be better than the source material on which it is based. Who reads the original safety studies? It is not the Members of the noble Lord's committee I am sure. One would not expect them to. Who does? The answer is that
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we rely on the diligence, accuracy and freedom from bias of a very few people, and also on the accessibility of a good database.
Again, time prevents me from detailing the worries which still exist but I refer particularly to methodology, which is at the heart of it. You cannot test irradiated food in a controlled way on human populations so it has to be done on animals instead. You cannot irradiate to many times the safe dose in the accepted way of scientific trials because the food would be uneatable even to rats. Therefore, the statistical reliability is lost in safety terms. In giving large vitamin supplements which most of the quoted trials seem to have done in their attempts to isolate the purely toxic effects of irradiation, if any, you confuse the picture so that few valid conclusions can be drawn. I believe if it were generally realised to what extent the methodological tail has had to wag the dog in assessing the safety of the irradiation of food, the cumulative unreliability of the evidence would be plain for all to see.
My final point concerns the database —the repository of all the scientific studies which is located at Karlsruhe in West Germany. That is a shambles. The London Food Commission, which may not be the Government's flavour of the month, took the trouble as serious researchers to go there in an attempt to pull out certain information. It was found impossible to do so. Your Lordships would find their December 1989 report on the visit interesting reading. The former director of Karlsruhe accompanied the visitors and did not disagree with their findings. I only have time for two short quotations:
"We found the data so disorganised that it would be difficult if not impossible for anyone to attempt to review any data other than the data actually submitted to the JECFI",
and:
"It is clear that the database cannot be used in its present form to either re-evaluate the safety data below 10 kilogray or provide information on safety above this level without considerable work by skilled information technologists".
Lack of funding is the problem and the London Food Commission is surely right in asking for action here since, in their words:
"It is after all being promoted as the definitive body of knowledge on what is claimed to be one of the most thoroughly researched food safety issues ever".
When there are such doubts about the safety trials themselves, their interpretation and their recording for subsequent use, it is small wonder that review bodies come to different conclusions about them.
If I have strayed from the report of your Lordships' Select Committee, it has been for the sake of addressing the most important of its conclusions; namely, that embodied in paragraph 142. If what I have said is accurate —and I have tried hard to stick to facts rather than opinion —then I suggest that the true position is rather better reflected by the conclusions of the Australian committee which I mentioned earlier, which had a status comparable to your Lordships committee and which over two years had an even more comprehensive look at the evidence. I end by quoting from its report at paragraphs 5.142 and 5.143:
"The Committee accepts that the majority of studies undertaken suggest that the ingestion of irradiated food will cause

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no harmful effects. Notwithstanding this comment there are two areas which are of concern to the Committee. First there are some studies which do indicate that irradiated food may be harmful in some instances. Secondly it notes the comments not only by witnesses opposed to food irradiation but also some regulatory authorities such as the FDA which indicate that many of the earlier studies are inadequate to make a judgment either way concerning the safety of irradiated food.
"In addition the Committee notes that JECFI in its various reports recommended that further studies be conducted. The Committee also notes the views of its advisers that animal feed trials would be unlikely to show adverse effects because cells of all living animals have evolved mechanisms designed to protect against the radiolytic products formed in irradiated foods.
"Accordingly the Committee recommends that:
the Australian Government request the World Health Organisation to:
review existing data relating to the safety of irradiated food; produce a fully referenced report on the safety of food irradiation, and identify those areas where further research is required".
That is not politics. That is good sense.
8.11 p.m.
Lord Lyell: My Lords, we should all be immensely grateful to my noble friend Lord Middleton and to his committee for the enormous amount of work that they have done; for all the evidence that they have listened to and indeed for the very firm, clear conclusions that they have set out in the report that we are debating briefly this evening. Most of the points —scientific and esoteric —for and against this process of irradiation have been very well made this evening. I wish to raise three or four points which seemed germane to me in scrutinising the report of the committee.
In paragraph 87 at page 21 of the report we find a definite conclusion that irradiation should not be used as a substitute for good manufacturing and agricultural practice. Those of us who are involved in the agricultural industry or who have had responsibility for it in another channel at any time, certainly ought to support that. That is one of the points that should be borne in mind by all of us this evening.
In paragraph 80 at page 20 the report mentions that irradiation can serve as a useful means of reducing the contamination of some foods by certain organisms. That is possibly something quite short taken from one of the conclusions in the report, but it sets the seal on this particular process of irradiation together with what we are discussing this evening, let alone in the Food Safety Bill; that at no time will it be compulsory or obligatory to eat irradiated food. We should consider that against the background of this evening's discussion.
In paragraph 143 of the report, in the conclusions, we find a recommendation that we should continue our present high standards to minimise and indeed defeat the clostridium botulinum which was mentioned both by my noble friend and by the noble Viscount. From paragraph 22 of the evidence —page 16 —and in reply to a question posed by the noble Lord, Lord Carter, we find that experts from the Ministry of Agriculture, Fisheries and Food made it fairly clear that irradiation is no panacea nor indeed a cure for this attractive clostridium botulinum which is well known to my noble friend the Minister. She may remember discussing this with me.
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At paragraph 8 of the Ministry of Agriculture, Fisheries and Food report, page 2, there is one particular fact which is germane to this process of irradiation and to what we are discussing this evening. I have not heard it discussed or denied that approximately 90 per cent. of all food-borne illnesses throughout the world are caused by two particular problems. One is salmonella, though I could not necessarily tell which one of the 1,200 strains. We well recall salmonella enteritidis, which was all the rage late in 1988. The other problem which causes 90 per cent. of food-borne illness is campylobactor. Both are inhibited by irradiation, certainly by the permitted dose. My noble friend mentioned fairly high dosages. I was given to understand in the report that a dosage of 3 kilogray would be sufficient to inhibit, if not entirely to remove, salmonella and campylobactor from chickens and fowl. All of us know that if fowl has been irradiated, they must be clearly labelled.
I was also somewhat startled to see that 20 per cent. of the weekly meat consumption in the United Kingdom is chicken —up to 8 ounces per person per week. That does not include me because I am a red meat addict and doubtless that will give some indication of my rude but normal health.
There are two further aspects to which I briefly draw attention. I refer to page 11 of the report and the Food Science Division of the Ministry for Agriculture, Fisheries and Food. This will be germane to what was said by my noble friend Lord Colwyn and indeed the noble Viscount, Lord Falkland. Two studies were carried out at Queen's University in Belfast both to identify irradiated food. The first was to search for lipid radiolysis detection using capillary gas chromatology and mass spectrometry. The second was searching for stable free radicals. Indeed, until my noble friend explained that to me I thought it could have had something to do with the political party of my Swiss friend —the free radicals —with whom I was skiing two weeks ago; but my noble friend explained it well.
I was very pleased that Queen's University seemed to be on the way to attempting to identify irradiated food using those two methods. I was interested to see electronic spin resonance together with thermoluminescence going some way to discovering the sex of chickens in chicken carcases. That is particularly valuable work being carried out in Belfast and I commend the university. I also commend my noble friend's Ministry for what it is doing.
In conclusion, we need only glance at page 85 of the evidence in the report where The Food Safety Advisory Centre states:
"It is our view that irradiation can be used to reduce or eliminate food spoilage organisms, food poisoning organisms and parasites".
However, it goes on to point out that this does not in any way reduce the need for the highest standards of hygiene and good management practice. If we remember that, together with what we are attempting to do with irradiation, it is not a panacea but it is to try to inhibit and perhaps eliminate two of the

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sources of 90 per cent. of the food poisoning outbreaks in the world, then tonight's debate will have been worthwhile.
8.18 p.m.
The Duke of Somerset: My Lords, it is clear from tonight's debate and from outside discussions that the most important aspect of the proposed introduction of irradiation into the UK is that of safety. If that could be established without argument, other considerations would be of lesser importance.
The committee received a great deal of evidence on this vital point and paragraph 29 of the report sums up succinctly that in its view there is no scientific evidence of danger to the health of the potential consumer. I do not think the time is right to go through that paragraph or reiterate all the evidence, but that was the conclusion. However, there still remain various caveats which are pointed out and certainly many worries in the minds of the public and other organised groups.
A great deal of this concern would evaporate if there was a test for irradiation. We have already heard that despite extensive efforts nothing at all is imminent in this line. That is a pity. I hope that the work in this direction will continue to be funded with the help of the Government. Not enough research has yet been carried out on other aspects such as packaging materials and pesticide residues. In fact, the report specifically recommends further investigation of the toxicological implications. As regards these last points and the Food Safety Bill, I wonder how the Government see this further research being funded.
The other aspect of the safety question is that of the microbiological implications. The great advantage of this process is the killing of the pathogenic bacteria in foods. We have already heard about that as regards salmonella, listeria and campylobacter which are the main targets. The point here is that once these pathogens have been killed it is vital that the foodstuffs are not reinfected by adjacent products. In written evidence, the Co-operative Wholesale Society noted:
"If an irradiated product is subsequently contaminated with a food poisoning organism it can grow with minimal competition"
and with great haste. So post-irradiation handling and storage regimes of high quality are vital; in other words, they must receive exactly the same care as other preparation processes demand.
Therefore, I think that the argument about bad food being dressed up in good clothes is a red herring. The eye, nose and the tongue will still detect change caused by spoilage. Microbiological standards can still be tested before irradiation takes place. One or two of your Lordships have alluded to various well-known cases to do with prawns and mussels. The fact that irradiation came to light indicates that the tongue and the nose were not lying and hence the malpractices were discovered. I am glad that the committee was able to conclude that the overwhelming weight of evidence shows that irradiation up to the dose of 10 kilograys is safe.
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So it is a matter of pity and concern that last November the Commission issued revised proposals for its directive. That reduced the number of the products to be irradiated. In particular the Commission removed from the list all poultry bar deboned poultrymeats. This must be a missed opportunity for it is acknowledged that all raw chicken carcasses are contaminated by campylobacter and many by salmonella and listeria; and perhaps up to 60 per cent. in the last two instances. There would have been an excellent chance here to increase the margin of safety for the consumer. However, by the end of this year the dangerous treatment of herbs and spices by ethylene oxide will be stopped and irradiation substituted.
The crux of this discussion must be individual choice. It is not the intention of any legislation or directive to impose irradiation on consumers. Indeed it is going to add a few pence per kilo to the bill. Everyone will be able to make up their own minds as to whether they wish to avail themselves of this safety belt. That is as long as irradiated food is properly labelled and identified.
I cannot see that this aim should cause undue difficulties. All packaged foods should have their ingredients listed on them and therefore annotated if irradiated. Treated loose products can be marked alongside the price ticket and on restaurant menus it will be easy to inscribe something suitable. All this would be made much easier by the adoption of a single clear logo throughout the trade right down to the consumer.
I trust that the Commission has withdrawn its original logo only to replace it with a more realistic design and that its use will be extended beyond that originally proposed. I believe that the process of irradiation is safe and that, as it is to be authorised, the consumer should feel satisfied and willing to experiment, choosing from well-labelled products. It is a shame that many consumers and retailers have already vociferously come down against irradiation before either studying the implications or sampling the products as the committee was fortunate enough to do during its investigation and also at the Leatherhead food research association. Irradiation must be part of the way forward in food safety.
8.26 p.m.
Lord Mackie of Benshie: My Lords, I too was a member of the committee and I greatly enjoyed the proceedings. I learned a great deal. I started with a prejudice against irradiation and finished with a prejudice against it. However, I have to endorse the main finding that irradiation is a safe process subject to a great many qualifications. Our recommendations begin by saying that irradiation is a safe process. However, the result is like a series of rather doubtful accounts: it is heavily qualified with a whole series of conditions which need to be met before the process is satisfactory.
We examined all kinds of people. While I share the doubts of my noble friend and others who are against irradiation, those to whom we spoke and from whom we took evidence were not fly-by-night people. For example, there were able scientists who

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had investigated their subject. The main fear everyone has is that food will become radioactive and that people will get leukaemia. That fear was completely dispelled in the course of much evidence that we took.
It was particularly interesting when we went to Holland. The politicians there were very wary. There is a research station in Holland where probably more work has been done on the subject than anywhere else. But the politicians were extremely wary about the process. They knew that there was a natural reaction among the public against irradiation. So they wanted to investigate every single aspect. We had to take great note of what was said. The politicians wanted to follow public opinion.
There is one minor point in the report with which I disagree, namely, that the process has no real commercial advantage. For example, I understand that oranges and other fruits can be irradiated at a low level and then picked nearly ripe. On reaching market the orange will taste as though it had just come from the tree. That may be attractive. It is not a procedure that I wish to see happening though there are commercial advantages as regards shelf life.
If the prejudice of the public is overcome I believe that irradiation will have a considerable commercial application. I am not saying whether that will be a good thing or not. The question of what happens when food is irradiated interests me. For example, when we visited our own research station we were shown irradiated eggs. The whites had broken up and the taste I understand, is awful. This means that unexplained processes go on. We were told that a great deal of research needs to be done before every fresh permitted irradiation subject goes on the market.
We must also look at the evidence of our experience in this country. It is true, as several witnesses said, that there is an increase in serious cases of food poisoning. In defence of irradiation some quoted pasteurisation. It is perfectly true that pasteurisation does not make milk taste very good and destroys a number of healthy factors in it but it has done a tremendous amount to cut down tuberculosis in milk. We cannot object entirely to the process but research is needed.
We need also to look at immunity. I do not suggest that we should eat dirt but there is an old saying that a speck of dirt never did anybody any harm. It is true that Egyptians do not get gippy tummy to the same degree as others and that Mexicans do not suffer from what is called Montezuma's Revenge. I was travelling in Mexico with a young vet. We had had a long hard day when we stopped at a roadside stall where a chap with a charcoal brazier was selling food. My companion said, "Oh, I must have something to eat". I said, "What a good idea". He said, "You lay off, you have a delicate stomach", something I had never thought before. He tucked in to the most delicious-looking cooked meat, bread and chillies. However, what he said was perfectly true. He was conditioned. We eat so much clean food that our immunity has been lowered. I do not suggest that we should eat dirty food but we should
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investigate whether we are destroying our immunity. We are probably now on the back of the tiger: we shall be eating cleaner and cleaner food until soon our food is completely sterile.
One of the most important points made in the report is that the Government must not introduce the legislation until the EC directive is settled. My noble friend referred to switching prawns from Malaysia back to Holland and then back to this country. That point would be covered in the case of EC regulations which apply over the country. Certainly close control has to be kept on the whole process, on the plants themselves and on the product.
The public must have a choice. They must be able to refuse to eat irradiated food if they so wish. Labelling is therefore of supreme importance. I do not suggest that every item on a restaurant menu should indicate whether or not it has been irradiated but any restaurant serving irradiated food should say so. The public must have a choice. But, subject to the precautions in the report, I am afraid that our first conclusion is correct. It is a safe process from the simple point of view. But the results of eating irradiated food over a long period need a great deal of investigation before we can be sure that it is not harmful.
8.34 p.m.
Lord Gallacher: My Lords, perhaps I may first of all say to the committee, its chairman and its specialist adviser that they have given us a wonderful report. It is a document of great skill and lucidity for which the House is duly grateful. The position as regards irradiated food has undoubtedly been complicated by the decision of the European Parliament and the provisions of the Single European Act. When we put our hands up so gaily for enacting the Single European Act we did not envisage some of the complications that might flow from it. Certainly such a complication exists as regards this directive.
The Government in consequence seem determined to press ahead with and indeed to go beyond the proposals in the directive. I should like to ask the noble Baroness who is to reply to the discussion whether this is now the Government's position. If it is, is MAFF not in danger of destroying any hope of a bipartisan policy for food in this country? If that is the case, and if that is a consequence of precipitate action in this field, the loss will be greater than the gain.
The opinion of scientific advisers is, as the report points out, mainly in accord and in favour. But this does not obscure the fact, as has been brought out in our discussion, that if side effects are possible over the years, particularly as a consequence of over-dosage of irradiation of particular foods, these may not be apparent in our present state of scientific knowledge. At paragraphs 41 to 43 I endorse the committee's recommendations about the need for continuous monitoring of toxicology, including packaging materials. Has thought been given to the disposal of such packaging materials by domestic users, and are they to be included as normal domestic rubbish? If so, what will happen to them? We also

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need to consider the effect of irradiation on pesticide residues. This point has already been mentioned. Will the Advisory Committee on Pesticide Residues be asked to report?
Nutrition is still a somewhat neglected area in food policy generally in this country; so the committee's recommendation in paragraph 50 is of considerable importance. As regards food quality, the point is rightly made that irradiation cannot improve quality but it can certainly disguise the consequences of prior bad handling. This is dealt with in paragraph 67. The report goes on to emphasise the role of environmental health officers in the inspection of quality prior to irradiation at plants. This is of considerable importance. Will this inspection by environmental health officers readily take place? The Government's thinking on the matter is that a centralised licensing system and operation ought to apply for irradiation. Within that, I should like to know whether the local environmental health officer will have full access as of right to plants. We are reminded in the report that there are 10 irradiation plants in the United Kingdom. Are these existing plants suitable as they stand for the commercial irradiation of food? If new plants are constructed, will they require special planning consent? If so, by whom will that consent be granted?
Safety is dealt with at paragraph 87. The Commission's proposal here is that approval is conditional on the safety of the application being established and on criteria to assure consumers that irradiation is used only where a proper justification has been established. Will the Government endorse these criteria if they decide to go it alone?
I turn now to the approved list of commodities in the directive. If there is no Community initiative in the near future, will the Government follow the original approved list of commodities or widen this list from the outset? Are any limitations of the list envisaged pending practical experience? On minimum dosages, we need also to ask whether the accepted principle, recommended by the committee at paragraph 105, of overall minimum dosages is accepted.
I turn now to the important question of detection. The noble Viscount, Lord Falkland, and others have asked whether the Government are fully committed to research aimed at establishing a simple diagnostic test. This leads me to ask how imports of irradiated food will be tested for dosages and where such tests will be carried out. Who will check the labelling on imports? So far as concerns information, the report stresses —rightly, in my opinion —the importance of a full and thorough information campaign so that consumers are given full information about irradiated food. I should like to make a plea that manufacturers are included in the consultation process about information with a view to ensuring good coverage, a well-co-ordinated information system and the avoidance of duplication.
Can we also be told by the Minister what labelling standards for irradiated food are envisaged for the United Kingdom? On timing, I also support the committee's view that Her Majesty's Government
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should proceed only in step with the Community on a serious issue which concerns a large section of consumers. If, however, the Government are determined to go it alone, as I believe they are, the affirmative parliamentary procedure should be used. I hope that when we come to that on Monday next the Government will respond sympathetically and positively. Perhaps I may once again congratulate the committee on its report.
8.40 p.m.
Baroness Trumpington: My Lords, I have immediately to make apologies because I am under certain timing restrictions. I should like to apologise in particular to the noble Lord, Lord Gallacher. I shall write to him with, I hope, answers to the many questions that he asked.
I listened with the greatest interest to my noble friend Lord Middleton, who as usual spoke in a clear and lucid way in explanation of the well-reasoned and balanced report of his committee. The Government are considering the report, and a formal response will be placed in the Library as soon as possible. I also appreciated the balanced words of my noble friend Lord Lyell and the noble Duke, the Duke of Somerset. I shall try to deal with as many points as I can. I am not surprised that the noble Viscount, Lord Falkland, is confused; neither am I surprised that his lady correspondents are confused. So much biased and misleading information has been published that perhaps on this occasion the noble Viscount will listen to the findings of Sub-Committee D, if not to me.
The World Health Organisation and the United Nations Food and Agriculture Organisation have declared themselves satisfied as to the safety of food irradiation. They recognise its value in killing salmonella, campylobacter and listeria. In other words, they recognise that it has a valuable part to play in combating the bacteria responsible for no less than 90 per cent. of the world's food-borne illness.
Those two world authorities concerned with food safety and public health are encouraging governments to take up the process. The World Health Organisation has, indeed, gone further. As the noble Lord, Lord Hunter of Newington, pointed out during our recent discussions in the Committee stage of the Food Safety Bill, their published food safety rules advise consumers to choose irradiated poultrymeat. I think those few comments make crystal clear the position of the leading world bodies on this subject.
As the report of Sub-Committee D states and as my noble friend reminds us, we in this country set up our own independent scientific review of that process, for which we assembled a most distinguished scientific team with expertise in all the branches of science relevant to assess the safety and the wholesomeness of irradiated food. We brought together medical experts, specialists in toxicology, in microbiology, in nutrition and in radiological protection. On the more specialised aspects of its work, the committee consulted other scientific committees with a still greater depth of experience

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in one aspect or another of the subject, so that in all over 50 individual scientists were involved. The recommendations of those eminent, highly qualified experts are in line with the findings of the scientific backing to which the European Communities Committee has referred in its report.
I wonder whether the noble Earl, Lord Baldwin, would care to repeat his allegations and name the member of our expert committee outside this privileged place.
Attempts have been made to cast doubt on the conclusions from certain isolated studies among the mass of scientific data; but the criticisms are mistaken and any doubts entirely misplaced. All the matters that have recently been raised as though they were new have already been carefully considered in the past. The view of the distinguished independent scientific committees is quite clear: no credible evidence of adverse effects has been produced.
I apologise to the noble Viscount, Lord Falkland, for forgetting that he had given me the source of his information. The London Food Commission has supplied a document which lists cases where abuse is alleged. In only one case, and that back in 1985, is it demonstrated that an illegal importation of irradiated food was made into the United Kingdom. Three comments are necessary on that case, to which the noble Lord, Lord Mackie of Benshie, also referred. The produce (prawns) was not substandard. The purpose of the irradiation was to maintain its quality. The import of irradiated produce was, however, in itself an offence.
It is not true to argue, as the London Food Commission frequently does, that no official action was taken. The appropriate authority (Dover Port Health Authority) investigated the matter, took formal statements in the presence of solicitors, and issued a formal warning which was given publicly as a deterrrent to others. If that action is criticised as insufficient, it should be borne in mind that neither the LFC nor anyone else has subsequently suggested that the firm concerned has repeated the offence.
The noble Viscount, Lord Falkland, asked about studies on irradiated wheat carried out by the Indian National Institute of Nutrition. The conclusions of those researchers have been rejected by the WHO, FAO, the EC Scientific Committee for Food, expert scientific committees in the United Kingdom, and by the USA FDA, Canada, Denmark and India itself. The verdict of the world-wide scientific community is that the results of the studies do not lead to the conclusions claimed by the researchers.
The noble Earl, Lord Baldwin, asked about the Australian Committee of the House of Representatives. That was not a committee of scientists, and its report cannot have the standing of the judgments reached by eminent toxicologists and all the other eminent scientists I have named.
My noble friend Lord Colwyn mentioned various countries or bodies that have come out against food irradiation. None of them has referred the matter for the advice of an independent scientific committee. My noble friend also asked about the danger from vitamin losses. Any process, even cooking, causes vitamin losses. There is no risk to
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nutrition from the irradiation of any food now being irradiated anywhere in the world. If that were not the case, the process would hardly have the support of the world-wide expert organisations and councils about which I have spoken.
Perhaps we should bear in mind the analogy of the pasteurisation of milk which also reduces the vitamin content; but that effect is clearly outweighed by the elimination from milk of potentially pathogenic bacteria. With irradiation the benefit is clear since, with the low dosage used in food, vitamin losses are in any case small. Nevertheless, the Government will be monitoring the situation, and the Select Committee agreed with the Government's reaction.
My noble friend also spoke about free radical production. Free radicals are continually formed in the human body. The Medical Research Council has commented that they are present in the majority of foodstuffs. A long-term study of that specific issue produced no indication of any harmful effects. Free radicals, I am reliably informed, are present on the surface of toast.
I have to take up the point my noble friend made about this country's slaughterhouses and put him right. The differences in requirements between our slaughterhouses and EC slaughterhouses are purely structural and are not matters of hygiene. It is over structural matters that some of our establishments do not meet EC standards.
The noble Viscount, Lord Falkland, asked about a possible increased risk of botulism. In the international arena that risk is discounted by the International Union of Microbiological Societies. In the United Kingdom, the Standing Panel on Hazards from Microbial Contamination of Food took a similar view. Food microbiologists understand very well the procedures necessary to avoid botulism. A combination of irradiation with existing techniques will do this. Irradiation is no different from other processes that do not sterilise. Research into irradiation will continue. Research into a definitive test for irradiated food will also continue, as I said at the Committee stage of the Food Safety Bill, and I reassure the noble Duke that that research will be funded by the Government. There may be outside interests also pursuing the same aim, but there will be research by the Government. As to the Government's view of the need for a detection test, as raised by the noble Viscount, Lord Falkland, the Government stated, as did the Select Committee, that a detection test would indeed be useful but is not necessary.
We are not alone in taking this view. The WHO thinks so and the Codex Alimentarius Commission also thinks so. The noble Lord, Lord Mackie of Benshie, suggested a need for full labelling. I entirely agree, and I repeat the assurances previously given that there will be full and clear labelling so that consumers can exercise that right of choice.
It has been suggested by the noble Lord, Lord Gallacher, that further research is necessary on additives, pesticide residues and packaging materials. Additives and pesticide residues are two subjects that produce an emotional response out of

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all proportion to any threat to health that they could possibly cause. We are talking about minuscule quantities—a few parts per billion. To assist your Lordships in visualising that, one part per billion is the equivalent of two grains of salt in a swimming pool. For the benefit of less sporting Members of your Lordships' House, that is about the same as the width of a credit card set alongside a distance of 600 miles. I think that puts the matter in its true perspective.
As for packaging materials, it is open to us in the UK to lay down a precise condition within an individual licence. We certainly accept the importance of close control over the materials that can be used, and we shall reflect carefully on the various alternative ways of achieving that.
Yet again this evening we have heard the tired old argument that irradiation could be misused to make bad food good. On that, let me simply refer the House to the response on the subject made in the recent "Horizon" television programme. The director of Leatherhead Research Association—a man of very wide experience—said that if that was what he wanted to do then irradiation certainly would not be the way he would do it, because that would not work.
Let me turn to the comments that have been made about the products for which the process should be allowed, and the question as to whether it might be reasonable to hold back here in the UK until the EC has acted. It is clear that there no scientific justification to limit the list of products. The Select Committee has underlined that point. It has been suggested that nonetheless there might be benefit in a limited introduction of the process so that experience with it can be steadily built up.
That is just what will happen anyway. We are proposing to introduce a licensing system. Each applicant will have to satisfy the licensing authority as to the technological purpose of treating each product. The authority will need to be fully satisfied that that is a sound use of the technology and that the applicant is competent in every way to meet our detailed requirements. That method of approach will in practice achieve a limited introduction of food irradiation without the need for any artificial restrictions on products. And of course each irradiated food will be clearly labelled at the point of sale.
As for delaying introduction, we certainly concur in the wish to have one harmonised set of rules across the whole EC. But I wonder whether the committee's recommendation on that largely reflected its belief that agreement was close. That has been suggested. However, it would be a brave Minister who would now risk a forecast as to what is likely to happen and when. Let us keep two factors very much in mind. First, the difficulties in Europe are political; they do not concern the safety of the process. Secondly, what we are seeking are public health benefits through enhanced food safety. Let me draw attention to the written evidence of the Medical Research Council to the Select Committee. The council said:
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"The public health implications are substantial, particularly in the case of poultry meat which at the present time is a major source of salmonellosis".
The noble Earl, Lord Halsbury, asked: why do we have to wait for Europe in order to have safely irradiated food? The noble Earl also asked me whether we could use existing provisions to introduce irradiation now. I must tell him that the powers exist, but they are not sufficient to allow us to introduce the full licensing controls that we and the Select Committee consider necessary. Astronauts have been given irradiated food. In the United Kingdom, irradiated wine corks, irradiated animal bedding and irradiated medical equipment are already permitted and sold here. I see no reason whatever to deny the British consumer clear benefits, which incidentally are already in use in several EC countries, just because of political disagreements in the EC. I suggest to your Lordships that the British consumer should have the opportunity to make his or her own choice.
8.56 p.m.
Lord Middleton: My Lords, I thank the noble Lords who have taken part in this debate. Several of them have suggested that there remains an element of uncertainty about the effects of irradiation. That may be so, but perhaps your Lordships should consider what is certain. What is certain is that outbreaks of food poisoning are multiplying yearly. Modern mass-produced food can be very unsafe. As we say in our report, up to 60 per cent. of uncooked untreated chicken carcases contain salmonella or listeria or both. That is certain. Recently a number of people in Holland died after eating untreated prawns. That is certain. Those are the kind of certainties that must be considered when making a judgment about whether a very thoroughly researched process should be adopted in aid of food safety, and the judgment that the Select Committee came to is summarised in paragraph 74. I am sorry that some noble Lords are unhappy with it.
The noble Lord, Lord Colwyn, spoke with great knowledge. He expressed many of the reservations and doubts of the BMA whose written evidence we were grateful to receive. We agreed with nearly all their recommendations, but we believed that their fears, which are shared by the noble Lord, about radioactivity were not justified. I recommend to the noble Lord, Lord Colwyn, that he looks at the paper submitted by the National Radiological Protection Board, which is printed on pages 112 to 115 of the report, especially the conclusion that they came to on page 115.
Finally, I should like to thank specially my noble friend Lady Trumpington for giving the Government's view. I hope she will feel that, though she has been called upon yet again to speak on food irradiation, she can agree with me that there is a continuing need for the public to be informed about the subject. I hope that she and your Lordships may feel that this report can contribute to that end, so that people can more easily choose, when the time comes, whether they want to have irradiated food or whether they do not.

Courts and Legal Services Bill [H.L.]
9 p.m.
The Lord Chancellor: My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee. —(The Lord Chancellor.)
House in Committee accordingly.
[THE DEPUTY CHAIRMAN OF COMMITTEES (LORD AIREDALE) in the Chair.]
Lord Mishcon Lord Mishcon moved Amendment No. 200A:
After Clause 47, insert the following new clause:
("Duty of the Law Society to find a solicitor on behalf of those reasonably requiring litigation or advocacy services.
.—(1) Where a person applies to the Law Society stating that they cannot obtain litigation or advocacy services from a qualified legal practitioner, the Law Society shall determine whether that person reasonably requires such services.
(2) Where the Law Society determines under subsection (1) above that a person reasonably requires litigation or advocacy services, it shall be under a duty to find a suitably qualified and able practitioner to act for that person.
(3) In performing its duty under subsection (2) the Law Society may require one or more of its members to act for the applicant.
(4) Where a member fails to comply with a requirement made by the Law Society under subsection (3), the Law Society may apply to the Solicitors Disciplinary Tribunal for them to exercise their powers under section 47 of the Solicitors Act 1974 against that member.").
The noble Lord said: I spoke to this amendment when we were dealing with the cab rank rule part of the Bill. I beg to move.
Lord Ackner: I spoke in support of the proposal when it was referred to en passant in the cab rank debate. It is only in order to reculer pour mieux sauter that I rise to continue to support the amendment, but I support even more the cab rank rule. One is not an appropriate alternative to the other.
Lord Mishcon: The noble and learned Lord is always welcome in this Chamber, whether he reculers or does not reculer.
Lord Hutchinson of Lullington: Talking English, I support the amendment in a half-hearted manner. It is a poor amendment, not a cab rank amendment. The idea is that a person seeking representation in an unpopular case must go round the mega-firms and be refused and then go round to the groups of advocates in the Crown Court and be refused. Then he has to make an application to the Law Society which decides whether he reasonably requires representation. When it has decided that, it sets out to find a suitably qualified practitioner.
One could hardly get further away from the simple cab rank principle which has been followed for many a long year in serious criminal courts by those who have rights of audience there. The principle is perfectly straightforward and simple: the client is entitled to the advocate of his choice. He does not have to go before some body which decides whether he reasonably requires some advocate, and then have that advocate told to represent him.
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If anyone suggests that this is a substitute for a cab rank, I regret to say that it is yet one more example of the downward path of the Bill regarding advocacy in the future. However, one has to go out and grasp whatever one can. So I support the amendment in a half-hearted manner.
Lord Rawlinson of Ewell: I agree with the noble Lord, Lord Hutchinson of Lullington and support the amendment, as one must, because at least it is something. Over the weekend I read of two prominent firms of solicitors who engage in criminal practice. They publicly announced that they refused to take in certain admittedly very unpleasant types of criminal cases. They refused ever to take the defence of persons accused of the offence of rape. These were two solicitors practising to a considerable extent with much criminal expertise. They publicly announced that any defendant who came to them under an accusation of rape would not receive any assistance from them. That is what we shall be up against.
I know that the noble Lord, Lord Mishcon, is doing his best by producing this clause. As was said, it is, at any rate, something. It is a humble exchange for the cab rank principle. However, what happened over the weekend demonstrates how sad it is that the Committee rejected the arguments insisting that the cab rank principle should apply to every advocate. Therefore I join half-heartedly in supporting the clause.
Lord Meston: I do not wish to repeat what has been said about the amendment which I agree should be a last resort rather than a substitute for the cab rank rule. I wonder whether the noble Lord, Lord Mishcon, would consider improving the wording of subsection (2) in order to impose a duty on the Law Society to find a suitably qualified and able practitioner as quickly as possible.
What one can see happening, particularly in civil litigation, is that if a litigant is abandoned by his legal advisers shortly before trial, there will be delay. In civil litigation the delay could be harmful to the other party and necessitate an adjournment. This system may work to the advantage of all concerned if the Law Society's duty is a duty to act as swiftly as possible.
The Lord Chancellor: I understand the spirit in which the amendment has been put forward. However, I take the same attitude to it as I took to the amendment dealing with the cab rank principle. These are matters that are best dealt with in considerable detail in the rules that will be set out for dealing with them when they arise. The point which the noble Lord, Lord Meston, made about the rule shows that the details need to be worked out closely. I should have thought this was one of the considerations that it would be right for the profession, the designated judges and the Lord Chancellor to have in mind when considering the report and the advice of the advisory committee. That committee should be asked to comment on it.
Strength comes through the detail of these rules and the way in which they are applied. That is true

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of the existing rules of the Bar relating to the cab rank and the rules that should prevail in future regarding the Law Society. I hope that the noble Lord may feel in the light of that response that the point he is putting forward in this amendment will certainly not be lost sight of. However, I believe it is best dealt with in the way I have mentioned. Where the Law Society has a duty to find someone fairly detailed rules would be required in that connection.
Lord Mishcon: In view of what the noble and learned Lord has just said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 48 [Multi-disciplinary and multi-national practices]:
The Earl of Shannon The Earl of Shannon moved Amendment No. 201:
Page 37, line 28, leave out subsection (2).
The noble Earl said: With the leave of the Committee in moving this amendment, I shall speak also to Amendment No. 202 which stands in my name. These two amendments to Clause 48 are fairly self-explanatory. The purpose of both amendments is to prevent the two legal professional associations, the Law Society and the General Council of the Bar, from having a quite unreasonable restrictive power over the individual freedom of both solicitors and barristers to enter mixed disciplinary practices.
The current situation as described in subsections (1) and (5) is that both are prevented by statute from entering a multi-disciplinary practice. The clause as it stands quite rightly states that this restrictive practice should stop. However, the freedom does not extend very far because it puts the power to enact provisions in this regard into the hands of the lawyers' professional associations whom I understand from their past record are not particularly favourable to this kind of freedom for their members. The clause puts that power into their hands effectively to prevent their members from entering multi-disciplinary practice and getting such an organisation off the ground. That means that the provisions of subsection (1), or alternatively subsection (5), are effectively repealed. Surely that is illogical nonsense.
In my view, the public would benefit from professionals embracing a number of diciplines and offering services from under one roof. While from time to time conflicts of professional interest and responsibility could arise, there is nothing that could not be resolved with thought and good will. That must have been realised when drafting subsection (1), or alternatively subsection (5).
A varied array of disciplines co-operating from the same office may well be able to offer the consumer a saving of time, an efficient throughput of work, a fertile ground for practical improvements, and could also provide a structure which could attract capital investment to finance a more professional service for the house-owning public. Like every other business structure, there can be no absolute guarantee of success but at least it should be on offer to the public.
The clause as it stands runs against the trend of the welcome changes which we have seen in the property market in recent years. It is also odd that the desirable provisions in subsections (1) and (5) of this clause are effectively removed in subsections (2) and (6). Although no amendment has been tabled to that effect, similar objections could be made to subsection (4). I beg to move.
Baroness Elles: It would be regrettable if the two amendments tabled by the noble Earl, Lord Shannon, were accepted. I regard subsections (2) and (6) as shining lights in a rather gloomy Bill leaving for both sides of the legal profession the possibility of regulating their own affairs in at least one area, not for their own benefit but for the benefit of the public whom they seek to serve. The noble Earl has not addressed himself to some of the problems that would arise in the creation of multi-disciplinary practices. There is the question of conflict of interest. If accountants and lawyers practise in the same firm and a will or a probate case arises and the client goes to an accountant who passes him on to a lawyer in the same firm, who will the lawyer act for if the case concerns a family problem? Legally binding confidentiality exists between a client and his lawyer, so how can that be dealt with when a client is passed down what I might call the assembly line of professional help offered under one roof? These different professions are subject to different rules of professional conduct. What one wants for the client is certainty. No client going to a mixed professional practice would know what rules applied to the people with whom he was dealing. That would be very unsatisfactory.
There are other cogent reasons why the amendment should be rejected. The President of the American Bar Association has already stated that if multi-disciplinary practices were allowed in England and Wales there would be a very grave risk that lawyers in those firms would not be able to practice in some states in the United States. Furthermore, lawyers would be unable to practice in certain member states of the European Community in which multi-disciplinary practices are barred.
There is one further cogent reason why the amendments should not be accepted. United Kingdom delegates on the CCBE—the Law Societies of Northern Ireland, Scotland and England and Wales together with the Bars of those countries —are all against the setting up of multi-disciplinary practices. I hope that the clauses will remain in the Bill and will be used by the profession for the benefit of the public.
9.15 p.m.
Lord Ackner: I should like to intervene briefly on this matter. It was proposed in the Green Paper that solicitors and barristers should be allowed to go into partnership. That is one of the consequences of the amendment.
Perhaps the strongest and most consistent critic of my noble and learned friend the Lord Chancellor was the Director General of Fair Trading. In 1986 he wrote a memorandum addressed to all Ministers pointing out that the effect would be a strong step

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towards fusion. It has always been the expressed sentiment of my noble and learned friend the Lord Chancellor that he was against fusion. On the occasion of the introduction of the White Paper he spoke of the need for a strong and independent Bar. That could not exist if the two amendments were accepted. Accordingly, I suggest strongly that they should not be agreed.
The Earl of Lytton: Perhaps I may speak briefly in favour of Amendment No. 201. It has a direct bearing on my own amendment, Amendment No. 201A.
We have already heard the opposing views that have been put forward. Professional bodies should be in a position to regulate to a large degree what their members do. However, it seemed to me that the Government's intention was to remove the statutory embargo on multi-disciplinary practices. If that is the case, it is curious to say the least that the same embargo should effectively be placed on the members of a professional body. I speak not as a lawyer but as a chartered surveyor. My own profession is one of the most deregulated professions in the land. It does not square with the purposes of the Bill that it should be transferred from a statutory provision to wording which seems to me, as a layman, to lead to the assumption that it is in order for professional bodies to have such forms of embargo.
As the noble Baroness, Lady Elles, has already explained, there are misgivings among the members of the Bar, and no doubt also in the Law Society, about how that would work in practice. The criticisms are based on a supposition that multi-disciplinary practices would not adhere to the general rules that prevail among the various professions concerned. It is no doubt the case that the rules of the Law Society and the Bar are very different from those of my own profession. However, I do not believe that they differ materially in their aims and objectives in so far as concerns conflicts of interest and confidentiality of clients' affairs. After all, in a legal partnership the fact that one partner deals with a client's affairs and makes that fact known to his partners presumably is not considered as a breach of that duty of confidentiality towards the client. It is perhaps unfair on the other professional bodies to imply that they are not capable of keeping a confidence or are not bound by rules and regulations as to their conduct. All professions are most severely bound by those constraints. That is what generally makes our professions the pillars of our society.
Baroness Elles: The noble Earl may not be aware that confidentiality between a client and his or her lawyer is bound by law. I do not think that that is the same for the other professions.
The Earl of Lytton: The noble Baroness, Lady Elles, speaks with much greater knowledge on this matter than I do. I could not begin to tell her what the situation was regarding even my own profession, save to say that I could be expected to have legal action taken against me were I to breach a confidence. I am not competent to say whether it would make any difference if that were backed by
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force of statute or by force of the wrath of one's client, but I take her point.
I should like to make one or two further points. First, with regard to my Amendment No. 201A, to which I shall speak briefly but which I shall not move at the moment, it will be for the convenience of the Committee if I say that it seeks to have all such rules or bars against multidisciplinary practice referred to the Director General of Fair Trading. The idea behind the amendment is that the matter should be subject to the scrutiny of someone whose primary interest is in fair trading and the public interest side of the matter.
Secondly, I understand that such a provision would be a direct parallel to the legislation introduced in Scotland under the Law Reform (Miscellaneous Provisions) (Scotland) Bill on the precise details of which I have no doubt that the noble and learned Lord the Lord Chancellor can enlighten me. The purpose of my amendment is in keeping with what I understand is the Government's policy on competition and is based on Clause 23 of the Scottish Bill. I do not know whether my amendment goes as far as or perhaps a little further than the amendment of my noble friend Lord Shannon, but I support the principle of his amendment.
Lord Mishcon: Perhaps it would be convenient to the Committee —it would certainly save time —if I were to address noble Lords on Amendments Nos. 201B and 201C because the matters with which we are now dealing are dealt with by those amendments. Anyone who has read those amendments will wonder why there are two amendments which say the same thing. Reflection made it apparent that Amendment No. 201C was better worded. I therefore ask noble Lords to consider only that amendment.
Clause 48(2) states:
"Nothing in subsection (1)"—
subsection (1) recites a section of the Solicitors Act 1974 which prevents solicitors from entering into partnership with persons who are not solicitors —
"prevents the Law Society making rules which prohibit solicitors from entering into any unincorporated association with persons who are not solicitors, or restricts the circumstances in which they may do so".
Noble Lords may recall the answer given by the noble and learned Lord the Lord Chancellor on a previous amendment which affected the Bar. "All that I am doing", said the noble and learned Lord, "is to give a power to the professional bodies to make such regulations if they see fit. I am not forcing them to do so. I am merely saying that I am loosening the force of Section 39. I am taking away that inhibition and giving the Law Society the power, if it wants, and only if it wants, to use it, to make rules which might enable solicitors to enter into an association with people who are not solicitors".
In those circumstances the Committee may wonder why I rise to oppose this subsection as emphatically as I can and ask the Committee to accept the amendment that I shall move in due course. I assure the Committee that my objection is not to multinational practice as between lawyers but to multidisciplinary practices; namely, that there

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should be the possibility of solicitors going into association or professional partnerships with those who are not lawyers.
The reason for my strong objection is that, if there were no statutory inhibition on the Law Society permitting such practices, the very gentleman who has been mentioned in the course of this debate —the Director General of Fair Trading —would be able to challenge the Law Society if it did not make regulations which allowed associations between lawyers and those who are not lawyers.
I remind Members of the Committee —I am sure that the noble and learned Lord will remember —that the restrictive trade practices tribunal under the proposed competition legislation announced in the DTI White paper called Opening Markets: new Policy of Restrictive Trade Practices, that the judgment as to whether rules are anti-competitive will be primarily made on economic criteria rather than general public interest criteria. In other words, economic criteria are to rule and the Director General of Fair Trading will be governed by those criteria when making his recommendations and challenges to any professional association that in his view acts contrary to those economic criteria. Indeed the Director General of Fair Trading published a report in August 1986—Restrictions on the kind of organisation through which members of professions may offer their services—and concluded that the statutory and practice rule restrictions on mixed partnerships should be removed.
My professional organisation, which is the Law Society —I should be very anxious if it did not hold such a belief—believes that that recommendation just did not take account of the special position of lawyers, which was so eloquently and, if I may say so, clearly explained by the noble Baroness, Lady Elles, nor of their obligations to the courts and their unique legal position regarding confidentiality. That was a matter to which the noble Baroness specifically referred. Therefore it is my submission that it would be completely unsafe under subsection (2) to remove the statutory inhibitions which are contained in Section 29 of the Solicitors Act 1974 because it would mean —I repeat —that the Director General of Fair Trading could challenge the Law Society and say, "There is the Courts and Legal Services Act 1990. Look at Section 48(2). The statutory prohibition has gone. Why are you not encouraging mixed partnerships between various professions? Why are you not dealing with the matter on the basis of economic criteria? We say that you should". Then there will be a battle. If that battle is lost by my profession, in my view a most dangerous situation will be set up with different rules of discipline and ethics binding the various constituent parts of a partnership. I should have thought that that was a very sorry event.
I therefore hope that subsection (2) goes. I hope that when I move Amendment No. 201 it will be accepted by the noble and learned Lord; and if not by him by the Committee. I very much hope that on the question of multinational practices, as the noble and learned Lord indicated at Second Reading, there will be provision to introduce regulations that will
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deal with those multinational partnerships. I hope that we shall see that the same rules which apply to our English profession will apply to such partnerships whether on competition matters or otherwise.
I have spoken to amendments that I have not yet moved. However, I hope that my contribution to the debate will clarify the issue, which is very important for my profession.
9.30 p.m.
Lord Templeman: Amendments Nos. 201 and 201A on Clause 48 raise questions of fundamental importance. First, is there a difference between a business and a profession? Secondly, is it wise or right to believe that anybody can do anything in any trade or profession whether trained to it or not? Thirdly, is it right that if there is a difference between a business and a profession, this legal profession should be left, within limits, to govern itself and lay down its professional rules?
The net result of the amendments moved by the noble Earls, Lord Shannon and Lord Lytton, would have the effect of destroying the profession. One could have a token lawyer in any firm. The noble Earl, Lord Lytton, spoke about the profession of a surveyor. There is no such profession. There is a noble profession of chartered surveyors. All kinds of people can call themselves surveyors and take part in multi-disciplinary partnerships in whom no reliance whatsoever can be placed.
It does not rest only with surveyors. All kinds of fringe people could become partners or directors of a company, so long as it had a token lawyer. All lawyers are subject to discipline. No one has explained how it will work in this great multi-disciplinary partnership, which will have different approaches. Its main thesis may simply be, "As long as we are making money out of it, let us go on".
Secondly, in my submission it is not right to assume that anybody can do anybody's job: that if one has a token lawyer one can engage on any work whether it includes law or any other area. It is the other way round. One ought to try to get every man to keep to his last. I know that my form of law occupies me quite long enough without my wanting to engage in partnerships with other professions and trades.
I believe that it would be detrimental to the public to have conglomerates which pretend to do everything and which are jacks of all trades but masters of none. It may be said that they may be found out. So was the Clowes organisation. Some other trades, industries and professions have been found out, but only at the cost of millions of pounds to poor investors and with great trouble and tribulation both for the Government and for everybody else.
Thirdly, if there is no case for a separate profession let us abolish every profession. Let everybody be able to do everything. But if there is a case for having a profession there surely must be a case for the legal profession. I know that in certain quarters that is thought to be elitist, as though we were trying to obtain some special privilege, but that is not so.

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Those of us who are no longer concerned with receiving fees and adding them up should at least be listened to when we say that beyond that there is a professional duty which we all respect because it is a duty to the public. We genuinely believe that if you throw everybody into the melting-pot or if you take all your eggs, break them and make them into an omelette, the one bad one will affect the rest.
We are asking for a separate profession. If there is a separate profession, albeit subject to the rules which my noble and learned friend the Lord Chancellor is introducing in order to ensure that they are competitive and so forth, it must have self-government within separate rules.
If the amendments tabled by the noble Earls, Lord Shannon and Lord Lytton, are carried, the provisions will destroy the profession because there will be no distinction between one company and another. While there is one man who is qualified for the Bar or who is a qualified solicitor you can do anything.
I hope that the two amendments will be defeated and that the Committee can turn to the more difficult amendment to be moved by the noble Lord, Lord Mishcon.
Lord Renton: This is a most important matter. The formation of multi-disciplinary partnerships by members of the Bar is against the public interest. It conflicts with the independence of the Bar and with the individual responsibility of the barrister to represent his client in accordance with the rule of law and to be answerable to the court for doing so.
It is a most extraordinary way of legislating. On the one hand we say that solicitors shall be allowed to enter into partnerships with people who are not solicitors. On the other we declare that there is no rule of law preventing barristers from entering into unincorporated partnerships with people who are not barristers. That is the foundation of the clause. Yet, in spite of Parliament enacting those two provisions as part of the law, we pass the buck to the Law Society and the Bar Council respectively for doing exactly the opposite to what Parliament has declared.
That is a strange and unprecedented way in which to legislate—although it is not totally unprecedented because we did so two clauses earlier but in a slightly different context. So far my noble and learned friend has been most successful in carrying highly controversial provisions contained in the Bill. I plead with him to take away the clause and look at it totally afresh in the light of what has been said by the noble and learned Lord and the noble Lord, Lord Mishcon.
However, if we must have the clause I agree that Amendment No. 201C tabled by the noble Lord, Lord Mishcon, should be enacted. I am reluctant to say so but, strictly speaking and if we follow his speech, the word "shall" in the first line ought to be the word "may". I speak for myself and perhaps some of my noble friends when I say that on Report it would be right, proper and logical for a similar subsection to be added affecting the Bar Council in the same way as the noble Lord's subsection affects the Law Society.
Lord Mishcon: The noble Lord said that the word "may" should be substituted for the word "shall". Does he remember his own words; namely, that he would wish to see the multi-professional association prohibited?
Lord Renton: Yes, I do. However, I was referring to what the noble Lord said in his speech and it may be printed in Hansard tomorrow. I understood him to say —and he must correct me if he did not say it —that the Law Society would not be bound to do that but it should be given the opportunity of prohibiting. If he did not mean to say that or did not say that, then I withdraw it.
Lord Mishcon: I started my speech —and I am sorry if I was not sufficiently clear —by saying that it might be thought that we did not have to worry about this matter because the noble and learned Lord might say, as he said previously in regard to another amendment which affected the Bar, that the Law Society does not have to enable multi-professional associations to exist. Therefore, why not give the Law Society that power? I then went on to say that the reason is that we are in danger, if that is done, that the Director General of Fair Trading, if there is not a statutory prohibition as I have tried to make it—and that is why I use the word "shall not" —could challenge the Law Society and on the ground of economic criteria say, "I am awfully sorry, but you are acting in an anti-competitive way. You have been enabled by an Act of Parliament to permit these things. Why are you not doing that?"
Lord Renton: That is splendid. However, it makes the clause, if I may say so, even more nonsensical. On the one hand, the Law Society is told in one subsection not to prohibit and in the other subsection it would be required to prohibit. we have got ourselves into a ridiculous situation. I hope that on Report my noble and learned friend will see that we put some sense into the Bill.
The Lord Chancellor: With the greatest respect to my noble friend, it is not a nonsensical situation at all. The present law prohibits the Law Society—and I take that first—from allowing partnerships with anyone who is not a solicitor. Of course, that includes lawyers in other countries. Therefore, the existing law makes impossible having a partnership between, for example, a firm in London and those who practise the law in France or Germany.
As I understand the position, the Law Society is of the view that that prohibition should not continue. Therefore, the statutory prohibition must be removed and I agree with that. The only question is: what should be substituted for it? I believe that the right substitution is that the Law Society should have the power to regulate this. Instead of there being a blanket prohibition in the statute as we have now, the Law Society should be given the power to make these regulations. It has the good of the profession at heart, and will make such rules as it thinks to be right in this connection. It is right that that responsibility should rest with the Law Society. That is what the clause does.

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The noble Lord, Lord Mishcon, in his amendments to which we shall come later, is endeavouring to fight a battle in advance which he may have with the Director General of Fair Trading. However, as my noble and learned friend Lord Ackner pointed out, the Director General of Fair Trading can be a great friend in some situations although he may not be quite such a friend in others. In his responses he has distinguished very clearly between the Bar and the Law Society in that connection.
This provision leaves it with the Law Society to make the rules, and I believe that that is entirely right. It can regulate the circumstances, and so on. If another law comes along which has to do with that, then the Law Society will have to deal with that as it arises. For example, it is quite clear from the Department of Trade and Industry's White Paper that it envisages that professional rules which are justified as required to avoid conflicts of interest would be perfectly acceptable under the legislation proposed from that department.
What we have in this clause is entirely sensible and right, leaving the matter to the Law Society. If we are to do that for the Law Society, there is no statutory prohibition on the Bar, so far as I know; but it is thought by some that there may be a common law rule. It is not at all clear that there is, but in order to make clear that the Bar should have the same sort of right to make rules, Clause 6 makes that perfectly plain. It takes away any concern there may be about existing law and replaces it with a clear power for the General Council of the Bar to make rules which have the effect of prohibiting barristers from entering into any such unincorporated association or restricting the circumstances in which they may do so.
I strongly urge the Committee not to accept Amendment No. 201, moved by the noble Earl, Lord Shannon, because I believe that this is a matter for the profession. The profession has pointed to considerable difficulties, which my noble friend Lady Elles has summarised, in allowing anything of the kind. These difficulties would certainly have to be dealt with before any rule could be contemplated which would have the effect of allowing multidisciplinary practices between solicitors and other professions in this country.
I believe that these are matters for the Law Society to consider. It has considered them and no doubt will continue to do so in the future as the situation develops. I believe it is right that the matter should be left with the Law Society. We are not encouraging the society in any way but merely making clear that it has this power and that it is for the society in its professional judgment to decide what is right. I am certainly of the view that it is correct to do that.
The same remarks apply as regards the General Council of the Bar and Amendment No. 202, to which the noble Earl spoke. I hope that in the light of that explanation the noble Earl will feel able to withdraw the amendment and, if not, that the Committee will negative it.
9.45 p.m.
Lord Simon of Glaisdale: My noble and learned friend the Lord Chancellor is, it seems, at one with the Law Society in wishing to sweep away any restriction on multi-national partnerships and associations. But he has gone on to sweep away more than that. He has swept away any restrictions on multi-disciplinary partnerships and associations. In doing so he has failed to recognise the point validly made by the noble Lord, Lord Mishcon, that the Law Society would be left open to objection by the Director General of Fair Trading on the grounds of setting up a restrictive practice if it took advantge of the power given by my noble and learned friend to inhibit multi-disciplinary practices. The only answer from my noble and learned friend appeared to be, "Well, the Director General of Fair Trading may not take that adverse view of the action by the Law Society". I imagine that the noble Lord, Lord Mishcon, would reply to that, "Well, he may not, but on the other hand he may". It is because he may that we want the protection.
The Lord Chancellor: Certainly the only point is whether it is right to exclude altogether any question of this sort. The Law Society being empowered to make the rules —and this is what I intend—any question of that kind is left for any legislation which may follow. However, as regards present law, it appears to me entirely right that the Law Society should have complete freedom in this area and that it should be able to make the rules it thinks right in the light of its consideration of these matters.
Lord Mishcon: I rise only to save time on the amendments when I move them. There are occasions —and I say this with the utmost respect to the noble and learned Lord —when his agility of mind supersedes his willingness to concede an obvious point. I hope that this is not going to be one of those occasions. Has one ever heard of a body generously given power by the noble and learned Lord which declines to accept it unless it be for very good reason? The noble and learned Lord is talking of giving power to the Law Society in order to make it possible for it to include multi-disciplinary practices which are now prohibited by statute. I can tell the noble and learned Lord that the Law Society does not want that power. While it appreciates his generosity, the Law Society tells him in no uncertain terms, "Please do not give it to us".
It gives a reason. It wants the multi-national practices and my amendment will provide for that when we come to it. The reason it does not want it is because there have been writings by the Office of Fair Trading which are sufficient to put the fear of the Almighty into any professional body. Those writings say: "We are after competition and trading in a fair manner. If we come across, through economic criteria, the acts of people who are empowered to have multi-disciplinary associations and they have not got them, we say that they should have them".
That is a very important matter. It is for that reason that I say to the noble and learned Lord: please do not give gifts which are not desired because those who give them create fear. That is exactly the situation here. I do not have to quote the classical

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phrase to the noble and learned Lord, who knows Latin and Greek much better than I do. We fear these gifts and we say to the noble and learned Lord: "We do not want them and we have given a very good reason as to why we do not want them".
Lord Donaldson of Lymington: There are times when I wonder whether this is not a private discussion between the noble Lord, Lord Mishcon, and my noble and learned friend the Lord Chancellor into which two noble Earls have butted unintentionally. I am about to say something intentionally. The reason I say something intentionally is because of the doctrine well known to lawyers as estoppel. I do not wish it to be said hereafter that I cannot take the point because I did not take it at this stage. So let me take it now and clearly.
As regards the utterances of the Committee, I do not accept the proposition that the competition board will have any power to interfere with the exercise by the Law Society of its powers proposed in this subsection. I say that for this reason. I imagine that we all agree that where rules of conduct or practice affect the process of litigation they have to be dealt with through the procedure laid down in Schedule 4 as regards the advisory committee, the Lord Chancellor and the designated judges. I do not believe that to be controversial.
I fancy that there is a deal of controversy between the noble and learned Lord the Lord Chancellor and myself which concerns what happens when a partnership of solicitors wants to do something in the non-litigious role. I take the view that the answer is self-evident, though I understand that the noble and learned Lord the Lord Chancellor takes a different view. In my opinion it is self-evident that A and B cannot be in partnership for one purpose and not another. A solicitor cannot be in partnership with a surveyor for non-litigious purposes, but not in partnership for litigation purposes.
The solicitors who will be partners in both partnerships would be in a quite impossible position. If there are two totally separate partnerships, which is a concept possible in law, it would not work. They would undoubtedly be sharing premises, confidences and staff. This arrangement is not on. As I see the matter —I shall argue it again if necessary hereafter, and that is the purpose of the present intervention —if it is permitted for barristers and solicitors to be in partnership, or solicitors and surveyors or solicitors and accountants, for any purpose, it has to be permitted for all purposes, including litigation. If it is permitted for litigation purposes, it has to go through the Schedule 4 method. I very much doubt whether there is a problem here but I range myself sturdily behind the noble Lord, Lord Mishcon. If there is any doubt, let us for goodness sake remove it by passing the amendment.
Lord Mishcon: Perhaps I may turn a conversation between the noble and learned Lord the Lord Chancellor and myself to one between myself and the noble and learned Lord the Master of the Rolls. I say this with deep deference but he has overlooked the provisions of the Administration of Justice Act 1985 which permit incorporated practices. One could therefore have a limited company with the
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objects of carrying out non-litigious work with a director who was a solicitor. He might have a separate practice or might not conduct litigation. He could be a director of that company and other people belonging to other professions could be fellow directors. Therefore it is possible to have such an organisation.
Lord Donaldson of Lymington: Perhaps the noble Lord will forgive me for returning to the fray just to mention this point. Under the existing rules of the Law Society —I am not sure whether they are the existing rules or proposed rules; at any rate they have been passed by the Council of the Law Society and I have approved them —to the best of my recollection it is not possible to have a director of an incorporated body of solicitors who is other than a solicitor. That rule will be maintained after the Bill is passed, if it is passed, and then the question will arise whether that rule is permissible. That will have to go through the Schedule 4 procedure and the considerations that I have already mentioned will apply.
The Lord Chancellor: I do not wish unduly to enter into this conversation except to say that I do not know whether my noble and learned friend the Master of the Rolls exactly stated my position. A number of problems are associated with it which I do not think it appropriate to go into at this juncture. In my view it is right that we should give this power to the Law Society and that we should not attempt to deal with what may or may not arise under legislation which has not come forward and which ought to be dealt with as it arises. It appears to me to be right to leave the matter as one which is no longer a matter of statutory prohibition but one for the Law Society and the General Council of the Bar.
The Earl of Shannon: I realised when I put down the amendment that I might be treading on some toes, but my, I did not realise quite how tender those toes were. The object of my amendment was to draw attention to the fact that we had two incongruous clauses alongside each other, one saying that you may have this extra freedom and the other saying that you will not be allowed to use it. That, fortunately, was when the noble Lord, Lord Renton, brought us back to the subject of my amendment. Previous to that we heard some pretty good speeches but I would suggest that they were not on my amendment. They were made to an amendment that was not down on the Marshalled List. They were speeches to an amendment to leave out subsections (1) and (5).
I was trying to draw attention to the incongruity of the clauses. To use the words of the noble and learned Lord the Lord Chancellor, he was removing one blanket but putting another blanket in its place. I was not terribly happy with it but I realised that the more the debate went on, the more eminent and the more learned were the guns against me. I shall leave it to the amendment which has been spoken to so eloquently with this one and see what happens there. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
10 p.m.
The Earl of Lytton The Earl of Lytton moved Amendment No. 201A:
Page 37, line 28, leave out subsection (2) and insert —
("(2) Any rule, whether made before or after the coming into force of this section, whereby a solicitor is prohibited from forming a legal relationship with another solicitor or any other person for the purpose of their jointly offering professional services to the public shall have no effect unless it has been approved by the Lord Chancellor and the Secretary of State, and before approving any such rule the Secretary of State shall consult the Director General of Fair Trading.").
The noble Earl said: I shall speak briefly to the amendment, because there is one point that I should like to raise in connection with it. Perhaps I may clarify my position. Although I have referred in loose and imprecise terms to "surveyors" —I am a fellow of the Royal Institution of Chartered Surveyors —I intended that the reference should have been to those who are members of professions and not just anyone who calls himself a surveyor or, for that matter, anything else. I apologise to the noble and learned Lord the Lord Chancellor for my lack of precision when giving evidence to the Committee.
While multi-disciplinary practices are not commonplace in the field of law, they are commonplace among practising chartered surveyors with chartered town planners and other bodies. That does not mean that everyone has to do everything. It does not mean that the chartered surveyor has to give evidence before a planning inquiry or that the chartered town planner gives evidence on valuation. Those practices operate successfully because there is a symbiosis between the professions concerned. That is my understanding of multi-disciplinary practices.
When I worked for a small firm in the West End it did not call itself a chartered surveyor, but that did not prevent me from being an associate of the Royal Institution of Chartered Surveyors at the time. It did not impugn my professional status. Subsequently, when I worked for a large insurance company that did not mean that I had to sell financial services. Now I work for myself and I can do more or less what I like when I like within the byelaws of my profession. I do not accept the criticisms of the risk of a multi-disciplinary practice, with the sole exception of the field of litigation where there may be problems in relation to advocacy which is only one part of the panoply.
The point that I should like to raise in connection with the amendment is that I fail to see that there is a special reason for the Law Society, or any other professional body for that matter, to be exempt from the overriding scrutiny of the Office of Fair Trading. The noble and learned Lord the Lord Chancellor pointed out that he does not exclude that possibility. The noble Lord, Lord Mishcon, clearly wishes to exclude it absolutely because he sees that his profession is at risk. It is not for me to suggest which of those opposing views are correct, but there is a point of public interest: the profession should be seen to be subject to the overriding scrutiny of those watchdogs that police our public affairs.
I should like to prompt the noble and learned Lord to consider making a specific inclusion —not
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necessarily the wording of Amendment No. 201A, but something along those lines —to make it clear beyond all reasonable doubt that that overriding scrutiny will be in place. If he gives me the assurance that it is not his, or for that matter the Government's, wish to exclude the provision I would not wish to press the amendment. I beg to move.
The Lord Chancellor: I would not wish to accept this amendment. The machinery that has been set up in the earlier part of the Bill for dealing with rights of audience and right to conduct litigation is one under which the designated judges and the Lord Chancellor will have to approve the rules before they become effective. If that is done, then the rules, according to the Department of Trade and Industry's White Paper, would not be challenged under the legislation that is being adumbrated in that paper.
But it appears to me that jurisdiction in relation to rights of audience and right to conduct litigation is the proper field for that kind of approval. The question is how far that goes, and that is a question which would obviously depend upon the circumstances. But I do not believe that it is right to seek to draw the Lord Chancellor into any area which is outwith that particular scope. Accordingly, I think that, so far as it is proper for the Lord Chancellor to have a place in this, that is provided for under that machinery.
In so far as it is not, it is best that he be left out of it. Therefore I think that Amendment No. 201A is inappropriate. In so far as it goes beyond the proper field for the Lord Chancellor, it is an inappropriate amendment. I hope that the noble Earl, in the light of that explanation, may feel able to withdraw his amendment.
The Earl of Lytton: Obviously, I hoped that the noble and learned Lord would go further than he has done. He has picked his way extremely adroitly through what is a not inconsiderable minefield of differing views here. But in the light of what he has said, there is obviously a procedural and structural deficiency to my amendment and therefore I beg leave to withdraw it.
Amendment, by leave, withdrawn.
[Amendment No. 201B not moved.]
Lord Mishcon Lord Mishcon moved Amendment No. 201C:
Page 37, line 28, leave out subsection (2) and insert —
("(2) Rules made by the council of the Law Society shall prohibit—

(a) solicitors entering into any unincorporated association with any persons other than

(i) solicitors, or

(ii) lawyers qualified other than in England and Wales; and

(b) persons who are not

(i) solicitors, or

(ii) lawyers qualified other than in England and Wales

becoming directors or shareholders of bodies recognised by the council of the Law Society under section 9 of the Administration of Justice Act 1985 (solicitors' incorporated practices)").
The noble Lord said: This amendment is most definitely moved and I shall not weary the Committee with another speech. I have already spoken on about four occasions in favour of this amendment. I beg to move.
Lord Templeman: Perhaps I may ask for information on this amendment. The Committee has now agreed that under Clause 48(2) the Law Society may make rules which prohibit solicitors from entering into any unincorporated association with persons who are not solicitors. So when five multi-disciplinary chaps get together, assuming that the Law Society makes a rule as permitted by Clause 48(2), they are bound to say, "But we cannot do it as an unincorporated association. That is easy enough. We can buy a company off the shelf and we become directors and shareholders. Although in law it will be a separate entity, in fact we shall just be the same five jolly chaps all doing the five different disciplines which the Law Society has made rules against, and therefore we shall not be bound by those rules".
I appreciate the difficulty which my noble and learned friend the Lord Chancellor has with building societies and banks, because of legislation which unfortunately was passed last year; but ignoring those for the moment, I want to know this. If the Law Society makes a rule which prohibits or curtails the rights of solicitors to join in as directors and shareholders of the kind of multi-disciplinary company which I have envisaged, is that a law which the Law Society can make, or is it one that falls under the general prohibition in Clause 48 or some other general prohibition? I should just like to know what is the situation.
Perhaps the noble Lord, Lord Mishcon, already knows the answer, but if so he has the advantage of me. I do not know what the answer is. I see that they can make rules about unincorporated associations, and my practice leads me to believe that it is very easy to form an incorporated association which has exactly the same effect. That would be undesirable.
The Lord Chancellor: I have not got all the legislation in front of me but my understanding of the situation is that the general rule with which we are dealing here prevents unincorporated associations. If we take that away we must replace it by giving the Law Society a power to prohibit.
On incorporated matters, an incorporated body can carry on the business of a solicitor only provided that it conforms with the rules made by the Law Society. These are subject to the approval of the Master of the Rolls. I also have a part to play in these rules and rules have been made. I shall check this since my noble and learned friend has raised it, but my understanding of the position is that there is nothing to inhibit the Law Society from making whatever rules it wishes preventing people other than solicitors being directors of a company, an incorporated practice, carrying on the business of a solicitor.
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The reason for the clause being restricted to the unincorporated association is that the general blanket rule which we seek to abrogate is so restricted. Therefore I believe that what my noble and learned friend seeks to cover is adequately covered.
Lord Mishcon: In view of the importance of this matter to my profession, I have no hesitation in saying that it is the duty of this Committee —and I put it most respectfully —not to behave recklessly in regard to what may or may not be the future activity of the Director of the Office of Fair Trading or future legislation. In protection of the traditions of my profession I not only move the amendment but in the circumstances I wish to divide the Committee.
10.12 p.m.
On Question, Whether the said amendment (No. 201C) shall be agreed to?
Their Lordships divided: Contents, 23; Not-Contents, 38.

DIVISION NO. 2

CONTENTS

Ackner, L.

Macaulay of Bragar, L.

Bonham-Carter, L.

[Teller.]

Byron, L.

Meston, L.

Carnock, L.

Mishcon, L.

Coleraine, L.

Rawlinson of Ewell, L.

Dilhorne, V.

Renton, L.

Donaldson of Lymington, L.

Rippon of Hexham, L.

Gallacher, L. [Teller.]

Seear, B.

Grantchester, L.

Simon of Glaisdale, L.

Hacking, L.

Templeman, L.

Hutchinson of Lullington, L.

Tordoff, L.

Irvine of Lairg, L.

Williams of Elvel, L.

NOT-CONTENTS

Ampthill, L.

Johnston of Rockport, L.

Belstead, L.

Joseph, L.

Blatch, B.

Long, V.

Brabazon of Tara, L.

Lyell, L.

Butterworth, L.

Lytton, E.

Caithness, E.

McColl of Dulwich, L.

Clanwilliam, E.

Mackay of Clashfern, L.

Craigmyle, L.

Macleod of Borve, B.

Davidson, V. [Teller.]

Mersey, V.

Denham, L. [Teller.]

Morris, L

Elles, B.

Reay, L.

Ferrers, E.

Saint Levan, L.

Fraser of Carmyllie, L.

Saltoun of Abernethy, Ly.

Gardner of Parkes, B.

Shannon, E.

Glenarthur, L.

Strathclyde, L.

Henley, L.

Strathmore and Kinghorne, E.

Hesketh, L.

Swinton, E.

Hives, L.

Torrington, V.

Home of the Hirsel, L.

Trumpington, B.

Resolved in the negative, and amendment disagreed to accordingly.
10.20 p.m.
The Deputy Chairman of Committees The Deputy Chairman of Committees: I believe Amendment No. 202 is not moved.
The Earl of Shannon: As I have already spoken on this matter at length, I shall not seek to move this amendment.
[Amendment No. 202 not moved.]
On Question, Whether Clause 48 shall stand part of the Bill?
Lord Hacking: Before we agree that Clause 48 stand part of the Bill I wish to draw attention to a difficulty which faces equally barristers and solicitors who aspire to participate in multi-national practices. The same difficulty would face barristers and solicitors who aspire to multi-disciplinary practices. However, it seems that there are not aspirations from either side of the profession to participate in multi-disciplinary practices.
I refer to Section 716 of the Companies Act 1985. If there are Members of the Committee who wonder what that section covers, let me state that it limits to 20 persons partnerships except in certain specific circumstances. One of those circumstances is a practice which is carried on by solicitors if the other members of that practice are also fully qualified solicitors. There is not an exception for members of the Bar who under their present rules do not practise in partnerships. However, as I indicated, it affects members of the Bar if they also aspire —as I understand that they do —to participating in multi-national practices. The difficulty is that a foreign lawyer, say one from another member state, does not fit into the category of persons defined under Section 716.
I understand that a letter has been written to the noble and learned Lord on the subject. I believe that there are three ways to deal with the matter: to treat Section 716 as redundant and repeal it; to amend Section 716; or to use a statutory instrument under Section 716(3). I do not know how the noble and learned Lord intends to act on the matter, but I draw it to his attention. It is a difficulty, one which faces both barristers and solicitors regarding multi-national practices.
The Lord Chancellor: The matter is one on which I seek to achieve a good way forward. I have the matter in hand. The Companies Act is the responsibility of the Secretary of State for Trade and Industry. However, I believe that we shall be able to find a way of dealing with the mater. Perhaps the noble Lord will feel able to leave it at that. I hope that the Committee will allow the clause to stand part of the Bill.
Clause 48 agreed to.
Lord Hacking Lord Hacking moved Amendment No. 202ZA:
After Clause 48, insert the following new clause:
(". —(1) Regulations made by the Law Society under section 2 of the Solicitors Act 1974, rules made by the Council of the Law Society under section 31 of the Solicitors Act 1974, and rules made by the Council of the Law Society under section 9 of the Administration of Justice Act 1985 shall not have effect unless they have been approved under Part II of Schedule 4.
(2) The concurrence of the Lord Chancellor, the Lord Chief Justice and the Master of the Rolls under sections 2 and 31 of the Solicitors Act 1974 and section 9 of the Administration of Justice Act 1985 shall no longer be required for the making of regulations and rules under those sections.
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(3) Section 26 shall not apply to the rules of conduct of the Law Society and the General Council of the Bar.
(4) In this Act "rules of conduct" means rules (however they may be described) as to the conduct required of members of an authorised body in exercising any right of audience or (as the case may be) any right to conduct litigation granted by it").
The noble Lord said: As the Committee is aware at this stage of the Bill, our sixth day in Committee, a new regulatory regime is being set up under Part II and Schedules 1 to 4 to the Bill. The current regulatory regimes covering solicitors are set out in Sections 2 and 31 of the Solicitors Act. Section 2 states that the Law Society,
"with the concurrence of the Lord Chancellor, the Lord Chief Justice and the Master of the Rolls, may make regulations in this Act referred to as 'training regulations' about education and training for persons seeking to be admitted or practise as solicitors".
Section 31 gives slightly wider powers to the Law Society's Council who,
"may, if they think fit with the concurrence of the Master of the Rolls, for regulating in respect of any matter the professional practice, conduct and discipline of solicitors".
There is a third regulatory regime, which is to be found in Section 9 of the Administration of Justice Act 1985, to which the noble Lord, Lord Mishcon, recently referred us, covering incorporated practices.
The amendment proposes that the regulatory regime for my side of the profession should come under the terms of the Bill. In proposing the measure —the noble and learned Lord the Master of the Rolls is present at the moment —I should make it plain that there is no dissatisfaction, despite one threatened application for judicial review, with the services with which he and his predecessors have kindly provided my side of the profession in reviewing and approving the Law Society rules. It is directed solely to bringing the regulatory regime under the one authority of the Bill.
The Government's White Paper, Opening Markets: New Policy on Restrictive Trade Practices, made it clear that competition law will be applied to professional rules, but that rules approved by Ministers will not be liable for subsequent challenge by the competition authorities. Thus, the Law Society's rules on training and conduct for higher court advocacy will, because they will require the approval of the Lord Chancellor under Section 4, be exempt from challenge, but other rules will not be. That will lead to considerable anomalies.
The Law Society believes that a single competition law regime for the legal profession would be appropriate and that, under that regime, the last word should rest with the Lord Chancellor who will naturally take into consideration advice on competition aspects before giving his approval to the rules. That is required under Schedule 4(9) with regard to seeking the views of the Director General of Fair Trading. The amendment will therefore provide that all the Law Society's training and conduct rules should go through the same procedure for approval; namely, via the Lord Chancellor and the four senior judges, after advice from the advisory committee and the Director General of Fair Trading.
The legal profession would not be the only sector to have a separate competition law regime. For

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example, the Financial Services Act 1986 provides that the rules of the SIB shall be submitted to the Director General of Fair Trading for this advice, but that the rules shall be approved by the Secretary of State. Under the Companies Act 1989, the regime for the authorisation of auditors likewise requires the Secretary of State to approve the rules with the Director General of Fair Trading offering advice in advance as to the competition aspects. For all those reasons, I beg to move.
The Lord Chancellor: The new machinery provided in the Bill is intended to deal with the right to conduct litigation and rights of audience. It is appropriate that it should deal with those aspects of solicitors' practice, but there is no cause to alter the arrangements that have stood the test of time in the balance of the situation. That is the way in which the matter has been approached from the time of the White Paper onwards.
If the Lord Chancellor has a place along with the Lord Chief Justice and other Heads of Division in relation to rights of audience and the right to conduct litigation, that is the appropriate place for his consent to be given. I do not believe it right that we should extend that over other areas which are presently the jurisdiction of the Master of the Rolls alone. I hope that, in the light of that explanation, the noble Lord will feel able to withdraw his amendment.
Lord Hacking: I thank the noble and learned Lord for his explanation. If the noble and learned Lord the Master of the Rolls is kind enough to continue his statutory duties, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 49 agreed to.
Clause 50 [Qualification for judicial and certain other appointments]:
Lord Mishcon Lord Mishcon moved Amendment No. 202A:
Page 39, line 12, at end insert —

("(ii) he is a solicitor or barrister of 10 years' standing; or").

The noble Lord said: With the permission of the Committee, I shall speak also to Amendments Nos. 202B and 204AA which deal with the same point of principle.
The matter can be dealt with very briefly. Noble Lords will remember that, under Clause 28, barristers are deemed to have been granted full rights of audience in all courts. That means that all barristers of ten years' standing will be eligible for appointment as a Lord Justice of Appeal or as a High Court judge. Solicitors other than circuit judges will not be eligible for such appointment until at least ten years have passed from the time that the first solicitors are granted rights of audience in the High Court by the Law Society under the regulations; namely, those approved by the Lord Chancellor and the four heads of divisions of the High Court.
It seems that if the exercise of a right of audience in the High Court, possibly on a regular basis, is to be the prerequisite of an appointment as a High Court judge, it will exclude from those available a very large number of talented solicitors, many of whom would be a credit to the High Court Bench.
The amendment is intended to make all solicitors and barristers with substantial legal experience eligible for appointment to the High Court Bench and, if I may say so, leave it to the good sense and judgment of those making the appointments to ensure that suitable appointments are made. I beg to move.
10.30 p.m.
The Lord Chancellor: The general route that we have proposed is that a right of audience in a court held for a sufficient time confers the necessary qualification to be a judge of that court. So far as concerns solicitors and others who have been judges in a court below, service in the court below will also be a qualification. That could result in solicitors reaching the High Court Bench much more quickly than in the kind of period mentioned by the noble Lord, again obviously subject to a suitable candidate. None of these is more than a qualification. It does not at all mean that anyone with the qualification would necessarily be a suitable person.
The method of reaching the High Court via the circuit Bench is open from the time that this Bill becomes law and I think it natural that the right of audience position, because it involves a change, should require to be in existence for a reasonable time before that qualification applies. In the light of that explanation I hope that the noble Lord will feel able not to press his amendment.
Lord Mishcon: Obviously I did not say it very clearly, but I said that those who were appointed to the circuit Bench did not come within the ten-year rule. I made that abundantly clear. But there are many talented solicitors who would not find it a natural course to go through the circuit Bench. If I may respectfully say so, the noble and learned Lord is depriving the High Court Bench of that talent.
Surely one could rely on the good sense of those making the appointments to say, "We are relieved at the fact that there does not have to be a period of ten years' standing since the advocate's certificate" —if I may use that expression —"was granted. Thank heavens that we have eligible solicitors. We want to appoint them. How sensible of Parliament not to have legislated so that we cannot possibly appoint those people". That is what I had in mind.
Will the noble and learned Lord be kind enough to consider that aspect of the matter? I believe that my side of the profession can contribute —I hope in good time very substantially —to the undoubtedly very high quality of the High Court Bench. If its members do not attain that quality, there will not be the appointments; but surely it is wrong to shut the door.
Lord Donaldson of Lymington: Perhaps I may intervene purely in the hope of being helpful. When I listen to the noble Lord, Lord Mishcon, it strikes me that the problem he raises is essentially a transitional one. There are now highly experienced solicitors, a few of whom do a lot of work in the county court, and who if they had been able to do so —if this legislation had been in effect —would have started off in the High Court many years ago. That is a rather different situation from that which will obtain in a few years' time when, should people in the capacity of fairly junior solicitors want to go in for High Court litigation, they will be building up the necessary qualification.
If the Government, for reasons on which I shall express no view at all, think that it is right to have a ten-year qualification in the future —that is to say, after four or five years —there might be a case for considering whether there should be a transitional qualification by which long standing in the solicitors' profession, perhaps of those engaged in county court litigation, might knock off a few years of the ten years shown here.
Lord Hacking: I do not think that the noble and learned Lord the Master of the Rolls meets the whole problem. There are extremely experienced solicitors who may have no wish to undertake the experience in litigation which would be required under the terms of Clause 50 of this Act but who nonetheless have high expertise as lawyers, high intelligence and high ability, and who would be wholly fit for High Court appointments. As the noble and learned Lord is aware, while in many ways it may be a better route on to the Bench for all persons to serve on the Circuit Bench before going on to the High Court Bench, it has not been possible by setting up such a regime to attract the great talent that the High Court Bench requires.
Exactly the same applies, for reasons advanced by the noble Lord, Lord Mishcon, concerning my side of the profession. I am disappointed with the reply of the noble and learned Lord the Lord Chancellor. The effect will be to deprive the High Court Bench now and in the future of persons who may be highly eligible to be among the finest judges in the land.
Lord Ackner: With great respect, the basis of entitlement is being widened. As I have understood the Bill, the appointment will be based essentially on advocacy experience. If it is advocacy experience the solicitor may have been highly successful and highly busy for 10 years in a specialised commercial field but he is not entering that field of qualification. If it is intended in future that the mere qualification as a lawyer is sufficient to become a judge, then that is taking the matter even further.
I thought when the rights of audience were being extended that we were keeping to audience. But apparently the appetite is growing in the feeding.
Lord Mishcon: It is not a question of appetite but of supplying need. That is what I am addressing my mind to. The noble and learned Lord, Lord Ackner, was a very fine advocate in his time as I had occasion
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to witness on more than one occasion; and —thank heavens! —it was on my behalf that his great advocacy on the occasion that I remember was so successful. He will be the first to remember that in the history of the judges great advocates have been poor judges, and poor advocates have been great judges.
The Lord Chancellor: On transitional provisions, I certainly have in mind that we may need to consider exactly how that would be achieved. But I have endeavoured to set out the criteria on rights of audience. Not every person who has a right of audience is necessarily a great advocate. But many who have acquired rights of audience in the past have turned out to be extremely good judges. I believe it to be a reasonable criterion to apply along with the criterion of service in a lower court. At the moment, as the noble Lord knows, a circuit judge of great distinction is not eligible for appointment to the High Court Bench if by chance he came from the solicitor's branch of the profession. That we are seeking to remove. It is an avenue of importance. I believe it is right to go forward in this way.
On the transitional provision, I shall consider further whether we ought to make some special provision.
Lord Mishcon: I am most grateful to the noble and learned Lord the Master of the Rolls for introducing the transitional point. and to the noble and learned Lord the Lord Chancellor for agreeing to consider the matter on that aspect. I hope that he may even widen his consideration and take in some of the comments that I ventured to make.
On the basis of what he has said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 202B not moved.]
Lord Ackner Lord Ackner moved Amendment No. 202C:
Page 39, line 31, leave out paragraph (c).
The noble and learned Lord said: In the interests of expedition I should like to speak to six amendments. They are Nos. 202C, 204CA, 204D, 204E, 204F and 204G. The first amendment relates to the clause and the others to the schedule. It will have the great virtue —probably none other —of subjecting the Committee to only one speech rather than to a series of disjointed speeches.
In my speech in the debate on Second Reading I invited Members' attention to the clause and to what I referred to as:
"the grotesque Schedule 7 running for some 20 pages in order to consider who will in future be our judges".
I ventured the proposition:
"Perhaps we are to have People's Courts! The hostages which this Bill gives to an ill-disposed minister of justice are incalculable". —[Official Report, 19/12/89; col. 206.]
Perhaps I may first lighten the atmosphere quickly by recounting to the Committee the forensic fable of an eminent Queen's Counsel who did not reach the High Court Bench. He was addressing the Court of Appeal and, being eminent, he had carefully thought out his submissions. He put them before the

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court and, as sometimes occurs, the presiding judge said, "Oh, but Mr. Brown, is not a much better way of putting it …", and he mentioned his method. Mr. Brown spoke the usual forensic cliché, "I am so grateful to your Lordship. Your Lordship puts it so much better than I do". In answer the presiding judge said, "Really, Mr. Brown, you should not say that". Then came the fatal answer, "No, my Lord, indeed I should not but then we always do".
I have recounted that fable because the tributes that I pay and have paid to my noble and learned friend the Lord Chancellor are most sincere. I pay tribute to his courtesy, charm, great intellectual abilities and outstanding powers of advocacy. But I have long been of the view, so succinctly expressed by my noble and learned friend Lord Hailsham, that the Lord Chancellor has one paramount duty: the protection of the independence of the judiciary and the integrity of the profession. The judges have no written constitution to which they can appeal. As my noble and learned friend Lord Rawlinson has emphasised throughout the debate, the Lord Chancellor is the guardian of the interests, powers and independence of the judiciary and that in relation to this function the officer was designed for a Minister to whom the Prime Minister and every other Minister ought to defer.
I hope that I shall be forgiven for once again quoting from the lecture given last year by my noble and learned friend Lord Hailsham on the office of the Lord Chancellor. I referred to it a week ago. He explained that the least support for judicial independence is to be found from:
"individual members of the Cabinet, whose departmental interests from time to time basically conflict not only with the views of the judiciary where they are entitled to differ, but in the provision of the means necessary to enable the courts to discharge their functions". — [Official Report, 25/1/90; col. 1237.]
If my noble and learned friend the Lord Chancellor, supported by the law offices, had been prepared to say to the Cabinet, using the words of my noble and learned friend Lord Hailsham last Monday at col. 54, "I believe that the end product of Part II of the Bill will be to undermine the integrity of the system of justice that we have developed over the years", that would have been an end of the matter. Then we should have had a glad confident morning again. However, that was not to be so; we are left with a glimmer of twilight.
I turn to Clause 50. In doing so, I ask Members of the Committee to be particularly concerned with what is the astonishing goal which the Government are setting out to achieve. Part II, which we debated at length, dealt with the rights of audience in Her Majesty's courts. By now it will be fully appreciated, if it was not before, that one of the major proposals of the Government is that laymen, provided that they meet certain requirements, shall have the right of audience —the right to appear in all courts from the lowest to the highest. We all know that the Government have produced no evidence that there is any shortage of lawyers properly qualified to serve the public in all courts in the land. Indeed proposals to extend the rights of audience of solicitors are clearly designed to provide a yet further supply of advocates.
Clause 50 carries those radical proposals one stage further. It proposes to enable laymen who have achieved the appropriate rights of audience —that is, the right to act as advocates in the appropriate courts—to become judges, again in all from the lowest to the highest courts. I venture to suggest once more that we shall hear no evidence that there is a shortage of properly qualified lawyers to act as judges. Indeed once again, in extending to solicitors appointments to the judiciary and the higher courts, a new supply of judges will be made available. Once more I anticipate that we shall receive no evidence that there is the slightest demand for lay judges beyond, of course, magistrates' courts.
My first amendment is to focus upon the fourth classification of the qualifications required. I emphasise again that I am focusing wholly upon laymen. If solicitors are to have the rights of audience in the higher courts, clearly they should be entitled to qualify for appointment to the judiciary in those courts, given that they have the appropriate experience and have achieved the appropriate competence.
Clause 53 provides that a person has a general qualification if he has a right of audience in relation to any class of proceedings in any part of the Supreme Court or all proceedings —and I stress the word "all" —in the county court or magistrates' courts. If one turns to Schedule 7 one will find a very high proportion of the appointments there identified as open to laymen who have that general qualification. The constant reference to that general category tends to hide the fact that in each case a right of audience is achieved by a layman in relation to proceedings in the magistrates' courts. That qualifies him for judicial appointment to the relevant office.
At page 8, Members of the Committee will find that a layman can hold the post of president of the Lands Tribunal —who, incidentally spends more of his time (or did, in my recollection) sitting in the High Court trying High Court actions —provided that for seven years he has had a magistrates' court qualification. The Committee will remember that that experience does not have to be continuous because Clause 50 (4) (b) provides that the period need not be continuous.
At paragraph 10 of the schedule, Members of the Committee will see reference to the very important offices of Judge Advocate of the Fleet and Judge Advocate General. That is now to be open to a layman who has a 10 year general qualification. That means that he has for 10 years, though not continuously, appeared in the magistrates' court.
I have suggested the deletion of this all-embracing general qualification to oblige the Government to come out in the open and record quite clearly that if that is the sort of qualification which is considered by them to be appropriate in relation to—again, I stress—laymen, then let it be clearly stated in the Bill so that all can read it.
It will no doubt be said, "Why this anxiety about laymen? Why should it be anticipated that they will to any real extent be appointed?" To those questions I answer quite simply, "Why make provision for them at all?" At the same time I invite the

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Committee's attention to page 91 of the Bill, lines 35 to 40. The permanent secretary to the Lord Chancellor, who is the permanent head of this immensely powerful department, need no longer be a barrister of not less than 10 years standing, as provided by the Supreme Court Act 1981, Section 88 and Schedule 2, Part I. He can be a layman who has been an advocate for the appropriate period solely in a magistrates' court. But far worse, under paragraph 1(2) he need never have been near a court in his life since a civil servant who has served at least five years in that department qualifies. I imagine that includes from the tea boy upwards.
The penchant towards civil servants without legal qualification acting as judges is again emphasised at page 92, item 9, headed:
"District judge of the principal registry of the Family Division".
A civil servant in that registry who has had a certain length of service now qualifies. At page 93 of the Bill, under item 12, the position of "District probate registrar" is to be open to civil servants without any qualification. Of course, once having arrived, promotion can take them ever upwards and onwards.
We have until now eschewed the continental system of a career judiciary. According to the White Paper, that is no longer to be the case. Paragraph 15.2 says:
"For these reasons the Green Paper proposes that all those who had held the appropriate advocacy qualifications for suitable lengths of time should be eligible for judicial appointments; and that the judges in a lower court should be eligible for promotion to a higher one on the basis of their judicial experience in the lower court".
I turn finally to circuit judges. These include county court judges and judges who try crime in the circuit courts. They are to be the recipients of a large injection of new civil work from the High Court. That gave rise to paragraph 183 in the Lord Chancellor's review body report, which states:
"The general weight of the judicial work to be done by Circuit judges on the civil side will move significantly up the scale. At the same time it will be necessary to attract to the Circuit bench candidates of the right standing, with sufficient experience to enable them to take this enhanced civil work. This consideration has led the Review Body to suggest that there should be a substantial upper tier of Circuit judges who would be remunerated at a higher rate".
Hot from the press comes the observations of the Top Salaries Review Body in its 13th report, published last week. At paragraph 59, on page 15, there is this reference to the Lord Chancellor:
"He regards the circuit bench as a mainstay of the judiciary to which it is vital to attract enough lawyers of the right calibre. Sitting in the crown and county courts and on occasions as judges of the High Court, circuit judges are responsible for hearing nearly all serious criminal cases and a considerable proportion of civil cases. They have a wide-ranging civil and criminal jurisdiction and a great deal of publicity can attach to some of their judgments".
There is no sign in this Bill. On the contrary, the circuit judges are to be downgraded. To carry out this added and more demanding work, an upper tier of circuit judges to take responsibility for heavier civil work should be appointed, but that has not yet been suggested. By turning to page 87 of the Bill, the Committee will see that the Government have gone precisely in the reverse direction. Laymen, with the
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appropriate advocacy qualifications, will be permitted to be circuit judges. A whole new range of office-holders is set out in the schedule. They will be appointed or they will qualify to be the holders of the office of circuit judges.
Under the old provisions which are to be added to, as regards the Courts Act 1971 Part 1 Schedule 2 there were only seven additional office holders who should, by virtue of the legislation, become a circuit judge: the Official Referee; Recorder of Liverpool; Recorder of Manchester; additional judge of the Central Criminal Court; assistant judge of the Mayor's and City of London Court; county court judge and whole-time chairman or deputy chairman of courts of quarter sessions for Greater London, Cheshire, Durham, Kent and Lancashire.
If Members of the Committee now turn to page 87 they will see a wide addition to those who shall also be considered as circuit judges. Not quite half-way there is reference to,
"Member (excluding the President) of the Lands Tribunal appointed under section 2 of the Lands Tribunal Act 1949".
However, as a member of the Lands Tribunal need not be a lawyer at all, but a surveyor—provided he is approved by the Royal Institute —in future there will be a non-lawyer in this important judicial capacity.
Last Tuesday I had the privilege of listening to the Scottish counterpart of this Bill. I heard the speech of my noble and learned friend Lord McCluskey and read it in Hansard. It makes attempts on my part to make contributions to this debate look decidedly timorous. In the Scottish Bill, though there is a provision for laymen to appear as advocates, there is no provision for them to become judges. I wonder why. Perhaps my noble and learned friend the Lord Chancellor will enlighten us when he replies. I beg to move.
11 p.m.
Lord Rawlinson of Ewell: In moving Amendment No. 202C standing in his name, my noble and learned friend has spoken to six other amendments, as he said he would. Some of them are covered by amendments which are in my name and which follow fairly shortly. As he opened the subject so generally, it might be for the convenience of the Committee at this hour if I add my comments as regards the amendment I intend to move, namely, Amendment No. 204A. It deals with the appointment of Lords of Appeal in Ordinary. I make exactly the same comments as my noble and learned friend made about the persons who will in future qualify for appointment. I say quite frankly to the Committee that this country would be a laughing stock if the highest court in this country, the Lords of Appeal in Ordinary, could have appointed to it someone who was not a barrister or a solicitor. It would be absolutely absurd.
It will be said that for the layman to get to that position he will have to go through the advisory committee; he will have to be expert as an advocate; he will have to have some knowledge of the law; and he will have to be bound by the rules of his profession. But let us consider for a moment that

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here we sit at eleven o'clock at night, a vibrant revising Chamber, dealing with a great constitutional matter and deciding who in the future will be the highest judges in the land. Are we prepared to say, sitting here as a Committee, that they can be laymen? It is quite obvious that they must be persons who are either barristers, or, now, solicitors. I am content that solicitors should be added to the list. They must be persons who have spent their lives in the practice of the law. I say that in respect of Amendment No. 204A. My reasons for saying it are the same as those given by my noble and learned friend Lord Ackner. I vigorously support him in his amendments.
Lord Simon of Glaisdale: The Committee has heard a quite remarkable speech from my noble and learned friend Lord Ackner. It is an absolute tragedy —indeed, a constitutional outrage —that it should have started at twenty minutes before eleven and finished at just before eleven o'clock in a Chamber that is virtually empty, with the television cameras shrouded and with the press gallery, I imagine, conveniently empty. An exceptional burden in the peculiar circumstances of this Bill has fallen on my noble and learned friend. He has no research assistant, but noble Lords have heard from him just now a most remarkable deployment of facts and evidence.
The Committee stage was fixed for three working days after Second Reading. That complied with the letter of the Companion to the Standing Orders but flouted its spirit. Of those three days, one was the day the House rose before Christmas, sitting at 11 a.m. The second day was the day the House reassembled after Christmas. Otherwise there was the recess for anyone working on amendments to the Bill. Looking at that, and bearing in mind the speech we have just heard, I think that noble Lords will all want to pay tribute to what my noble and learned friend has done both in his deployment of the principle that he has sought so strenuously to vouchsafe and in his deployment of the evidence in support of it.
Lord Hutchinson of Lullington: We are on Schedule 7, which contains what has been referred to as a grotesque situation. Perhaps I may ask the noble and learned Lord about the qualifications for appointment as a puisne judge of the High Court in Clause 50(1)(b). He has to have a 10-year qualification. That presumably means in the Chancery, Queen's Bench or Family Division. It does not include the Criminal Division. The situation under the Bill therefore is that if one's practice has been in the criminal courts one cannot qualify for the High Court Bench unless one becomes a circuit judge. That would seem to bar a number of highly distinguished High Court judges at the moment.
Returning to the grotesque situation —the circuit judge qualifications on page 87 —one reads that one qualification is that those persons who have held office under Part IA, as set out on that page, for at least three years qualify to be a circuit judge. Can what one reads be possible? A special commissioner of income tax, an Admiralty registrar, a registrar in
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bankruptcy, a district probate registrar, after three years will be experts, I suppose, in sentencing offenders, in the understanding of the rules of evidence, the law of contempt, the more esoteric provisions of the Theft Act, the burden of proof, and so forth. Is it really suggested that those persons will be qualified to be circuit judges and to sentence people to imprisonment?
Like the noble and learned Lord, Lord Ackner, I find that the only word that is suitable is "grotesque". When one conies to paragraph 59 and the various persons who hold offices, there is the office of the Director of Public Prosecutions. As the noble and learned Lord has pointed out, once again it is a 10-year general qualification. A person who has a 10-year general qualification will be qualified to be the Director of Public Prosecutions with all the powers which at five minutes past 11 I shall not detail. It is about the most responsible job on the criminal side and that of the liberty of the subject that there is. Again, the situation is almost grotesque.
One could continue through the list. One notices that the president of the Immigration Appeal Tribunal requires a general qualification of seven years, whereas opposite —I shall not bother to give the page —the assessor to the Farriers' Disciplinary Committee, which I am sure is a crucial appointment, must have a qualification of 10 years. Again, one wonders why the one is so much more important than the other. So it goes on. A justice's clerk needs a qualification of only five years' practice in the magistrates' court and need not be a lawyer. He is the man who advises every bench of magistrates, who try over 90 per cent. of crime in this country, and he does not have to be a qualified lawyer. Grotesque is the only word that one can apply.
The Lord Chancellor: The general qualification that applies at present to many judicial offices is of being, for example, a solicitor with a certain number of years' standing. There is no qualification in quite a number of these instances in respect of any particular experience, though for solicitors there is presently a requirement to serve as recorder for a certain time. But the basic qualification is the first matter.
So far as qualification is concerned, the general principle that we have adopted in preparing this schedule is that, first, a right of audience in the court in question will qualify so long as it is held for a particular time, and that, secondly, there is experience in a court below which would give a qualification for the court above.
My noble and learned friend Lord Ackner, in a speech to which I am very happy to pay tribute along with my noble and learned friend Lord Simon of Glaisdale, because he set the matter out very plainly and clearly, has repeatedly referred to a lay person qualifying. I am not absolutely certain that I know precisely what he means by "lay" in that situation. But a person who has a general qualification will be somebody who has satisfied the training qualifications which are approved by the senior judiciary and the Lord Chancellor as qualifications appropriate for pleading in the courts referred to in the general qualifications.

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I have no reason to suppose that the qualifications will not be appropriate to that work. The precise nature of the qualifications is a matter for judgment in the light of developments. But that is surely the highest possible assurance that people who are qualified to have rights of audience there described are people who are properly qualified in terms of regulations, the standards of which have been set.
The noble Lord, Lord Hutchinson of Lullington, mentioned first the question of the High Court qualification. It is right to point out that a High Court qualification exists if a person has a right of audience in relation to all proceedings in the High Court. A barrister under the arrangements in this Bill will have a right of audience in all parts of the Supreme Court because on satisfying the qualifications he will have that.
The point about a High Court qualification is that in future there might be a person who was qualified in the High Court only, a person who wished to confine himself to civil proceedings and not to handle work in the remainder of the Supreme Court.
The idea that the right of audience in the High Court would not of itself be an appropriate qualification is, in my judgment, grotesque. Surely those who will be entitled to practise in the High Court can be regarded as people judged properly qualified by the senior judiciary and the Lord Chancellor. The principle which applies to all the cases to which my noble and learned friend Lord Ackner referred, and which have been referred to by the noble Lord, Lord Hutchinson of Lullington, is the general principle that I have described; namely, that qualification of judicial office in a court below will, generally speaking, qualify for the immediately higher court.
It does not follow by any means that a person who has these qualifications is suitable. All barristers are theoretically qualified for appointment to the High Court at present on a certain number of years' standing. It does not at all follow that everyone would be suitable. But these seem to be defensible qualifications in principle. I hope in the light of that explanation your Lordships will see that the principles on which these qualifications are constructed are sound principles which should be affirmed.
11.15 p.m.
Lord Ackner: Before my noble and learned friend sits down, perhaps he would be kind enough to assist me on two matters. When I used the word "lay" I do not mean a lawyer. The two questions on whicn I should be grateful for his assistance are these. Is there any evidence to indicate that there is any demand in this country now, or anticipated in the immediate future, for non-lawyers to be judges? Secondly, perhaps he could answer the question which I specifically raised in my speech: why is this not also being provided for in Scotland if it is a good idea? We have just had a modified Scottish contingency fee imposed upon us.
The Lord Chancellor: I have sought to explain that we have put forward a system which depends on
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rights of audience. That is the way in which the matter has developed. We have simply provided a framework under which those other than members of the Law Society and the Bar might qualify for rights of audience or the right to conduct litigation.
There is no evidence whatever that if a person is properly qualified to conduct litigation or to have a right of audience in the High Court, that person would not be reasonably qualified to be a judge in that court. He might not be suitable for other reasons. Therefore in my judgment it is right that when one is making provision for a possibility which may arise for people with qualifications to have rights of audience other than those people who are members of the Law Society and the Bar, their qualifications to act as judges should also be recognised.
Lord Rawlinson of Ewell: The noble and learned Lord has not replied to the point about Scottish law. Why is the Scottish system to be different? That question was specifically asked by my noble and learned friend and we should be grateful if the noble and learned Lord the Lord Chancellor could enlighten us as to why we are selected in this particular way in England and Wales when Scotland is still allowed to have lawyers as judges.
The Lord Chancellor: The circumstances differ in some respects. The most important difference is that the arrangements here for the enlargement of rights of audience are a good deal more elaborate than the arrangements which are provided in Scotland, although the safeguards are very much the same. The principles which we have adopted are the same as those which underlie the Scottish legislation.
Lord Hutchinson of Lullington: Perhaps I may put the question again. The qualification for a High Court judge, a puisne judge, is a 10-year High Court qualification within the meaning of Section 50 of the Courts and Legal Services Act. "High Court qualification" means having a right of audience in relation to all proceedings in the High Court. That is in the Chancery Division, the Queen's Bench or the Family Division. Suppose that one's practice was not in the High Court but in the Criminal Division. That would mean that in the future such an advocate could not become a High Court judge. Was I correct in my reading of these provisions?
The Lord Chancellor: A Supreme Court qualification means that a person has a right of audience in relation to all proceedings in the Supreme Court; that would be a sufficient qualification. If a person were a barrister under the present arrangement, he would have the right of audience in relation to all proceedings in the Supreme Court and be eligible. The noble Lord was suggesting that many people who are presently High Court judges would not be qualified. However, that is not correct on the basis that I have just explained to him. The idea is that if a person had purely a High Court qualification in the future he would not be eligible by reason of that alone to sit as a Supreme Court judge in the Crown Court.
Lord Hutchinson of Lullington: With the greatest possible respect, I should draw the attention of the Committee to Clause 50(1)(b), which states:
"(qualification for appointment as puisne judge of the High Court) for the words 'unless he is a barrister of at least ten years' standing' there shall be substituted —
'unless —

(i) he has a 10-year High Court qualification' ".

That is not, with the greatest respect, a Supreme Court qualification but a High Court qualification. That is the point that I am making. The words used mention a,
"10 year High Court qualification".
A High Court qualification involves,
"a right of audience in relation to all proceedings in the High Court".
That does not include anything other than the Chancery Division, the Queen's Bench Division and the Family Division. What is the position of an advocate whose practice is in the Criminal Division? Does that mean that he cannot become a High Court judge? That is the question I am asking.
The Lord Chancellor: The answer on this point depends whether he has,
"a right of audience in relation to all proceedings in the High Court".
Under the arrangements which presently subsist and which are likely to subsist for some time to come, the person who has a criminal practice in the Supreme Court will also have,
"a right of audience in relation to all proceedings in the High Court".
However, the question concerns whether it is right that a person who is to be a Lord Justice of Appeal should be so unless he has a,
"10 year High Court qualification",
within the meaning of this clause. I suggest to the Committee that a person who will have a jurisdiction in the Court of Appeal should be qualified in all proceedings in the High Court.
Lord Renton: But that would mean (would it not?) that somebody who had never appeared before the Court of Appeal could be made a Lord Justice.
The Lord Chancellor: That is technically the position at the present moment.
Lord Ackner: At this late hour the Committee would not look upon it as respectful for me to divide it. I am therefore left with no alternative but to withdraw my amendment. However, I reserve all proper rights to return to my amendments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 203 and 204 not moved.]
Clause 50 agreed to.
Schedule 7 [Judicial and Other Appointments]:
The Deputy Chairman of Committees (Lord Grantchester): If Amendment No. 204A is agreed to
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I cannot call Amendment No. 204AA. I now call Amendment No. 204A.
Lord Rawlinson of Ewell Lord Rawlinson of Ewell moved Amendment No. 204A:
Page 80, leave out lines 12 to 21.
The noble and learned Lord said: I have already touched on this amendment. We come now to the qualifications for a Lord of Appeal in Ordinary. Under the Appellate Jurisdiction Act 1876 a Lord of Appeal in Ordinary must have been for not less than 15 years a practising (that word is important),
"barrister in England or Ireland, or a practising advocate in Scotland".
As the Committee has accepted that the solicitors' branch should be eligible for judicial appointments—I fully support that —that would mean that the same principle should have been left as it was. As we all know, that should be a proper qualification for the Supreme Court, the highest court in the land. It should be a proper qualification for the judges, some of whom have participated in our debate.
I can only repeat that it will make us a laughing-stock if we do not confine Lords of Appeal in Ordinary to persons who are qualified lawyers, by training and practice, barristers or solicitors. I beg the noble and learned Lord at least to have regard to the reputation of this country. There should not be the possibility that the highest judges of the land could be persons who are not either barristers or solicitors. I beg to move.
The Lord Chancellor: The persons who are qualified under the schedule to be Lords of Appeal in Ordinary are those who have a right of audience in relation to all proceedings in the Supreme Court. I submit that, having regard to the safeguards which are required in that respect, a person with Supreme Court qualifications is indeed appropriate to be regarded as being eligible for appointment to the highest tribunal in the land as someone who has been regarded, in terms of the qualifications which have been approved by the senior judiciary and the Lord Chancellor, as having a right of audience in the Supreme Court.
Lord Rawlinson of Ewell: It is because we have built up this elaborate, and to some of us absurd, procedure that we find ourselves in this position. My noble and learned friend cannot deny that under the provisions that he proposes, it will be said that the highest judges of this land could be people who are neither barristers nor solicitors, or lawyers at all. I say that that makes this country a laughing-stock.
The Lord Chancellor: With great respect, I do not accept that they would not have sufficient qualification in law to be properly regarded as advocates in all branches of the Supreme Court. Whether one calls them a barrister or a solicitor is not the issue. The question is whether they have the qualifications that are required under the regulations approved by the senior judiciary and the Lord Chancellor to appear in the Supreme Court in all its aspects.
Lord Rawlinson of Ewell: People will ask, "What are the qualifications for your Supreme Court? What are the qualifications of your Lords of Appeal in Ordinary?" One will say, "They are people who have some qualification. They may be surveyors who have been trained in this particular way. They are very good people and they have had some practice in the High Court". "Do you mean to say", we shall be asked, "that they are not persons who have been admitted by the Law Society or called to the Bar and recognised as lawyers?" We shall have to say that that is not the case because of the procedure that has been built up in the Bill. It is not good enough. We should say that our highest judges must have professional qualifications.
Lord Hutchinson of Lullington: I believe that the matter should be pursued further. Hereafter is the situation to be that there will be lawyers who qualify as barristers, lawyers who qualify as solicitors and a category which covers people who are not lawyers but have some other qualification which entitles them to practise in a court of law? Therefore, when one says "Who is so and so, who is Lord X or Lord Y?" one will be told, "He is a Law Lord". If one asks whether he was a barrister or solicitor the answer will be, no, he was someone who qualified to be an advocate in various courts. Is that really to be the situation in the future regarding the qualifications for the greatest judicial office in the land? I find it almost unbelievable.
11.30 p.m.
The Lord Chancellor: The short answer is that when one mentions a barrister to some people abroad, they do not know exactly what he is. I have no doubt that many do, but not everyone does. It is perfectly reasonable to ask what Lord X was, to which the reply might be that he was a distinguished and qualified Supreme Court advocate for 20 years. I should have thought that that was a perfectly reasonable answer which would satisfy the intelligent and inquiring observer.
Lord Hutchinson of Lullington: I find it particularly sad that in discussing the Bill we have reached the stage at which it is suggested by the noble and learned Lord the Lord Chancellor that a normal person would have no idea what a barrister is.
The Lord Chancellor: I did not say that. I am sorry that the noble Lord has to turn what I said to something else. I said that some people abroad do not know what a barrister is. I have met some people who did not know what an advocate was; that was my professional qualification. I certainly did not indicate that the ordinary person did not know what a barrister was. I should have thought that a Supreme Court advocate was a perfectly reasonable and intelligible description.
Lord Ackner: In the debate on the Law Reform (Miscellaneous Provisions) (Scotland) Bill on 30th January, my noble and learned friend Lord McCluskey was able to give some assistance. He said:
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"Any professional or other body can apply for rights of audience in any court for its members".
He was dealing merely with advocates because the provision does not apply to judges. He went on to say:
"That applies to the Royal Institute of British Architects, the Scottish Citizens' Advice Bureau, the Orange Lodge, the Showman's Guild and the Licensed Victuallers Association, all of which are from time to time concerned in litigation in our higher courts."—[Official Report, 30/1/90; col. 189.]
There is no doubt that, with a little research, we can provide further and even better particulars, but that is some idea of what looms large in the future. Hence my phrase of a glimmer at twilight.
Lord Rawlinson of Ewell: It is half past eleven. All I can say is that I wonder whether it is worth noble Lords continuing the debate on the Bill. I should have divided the Committee if it had been reasonable so that we could have obtained a decision. I found it not only grotesque, as the noble Lord, Lord Hutchinson, said, but shaming that we have got ourselves into this position when our aim is quite simple. We want to provide access to more people who are qualified to provide the services. We should set that aim out straight. Judges should be drawn from barristers and solicitors. We have been playing with words. He does not need sympathy from me, but I feel sorry for the noble and learned Lord the Lord Chancellor that we have got into this position. It is with a desperate feeling of shame that I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 204AA to 204G not moved.]
Schedule 7 agreed to.
Clause 51 [Presiding Judges]:
The Lord Chancellor The Lord Chancellor had given notice of his intention to move Amendment No. 204H:
Page 40, line 7, leave out ("two") and insert ("one or more").
The noble and learned Lord said: I do not propose to move the amendment, although I intend to come back to it on Report. As it stands, the clause imposes a requirement to appoint two presiding judges to each circuit. What is needed is flexibility to appoint more if necessary. On reflection I prefer to express the power in that way. I shall not therefore move the amendment.
[Amendment No. 204H not moved.]
[Amendments No. 205 and 206 not moved.]
Lord Ackner Lord Ackner moved Amendment No. 206ZA:
Page 40, line 20, after ("Chancellor") insert ("with the agreement of the Lord Chief Justice").
The noble and learned Lord said: This is such a small amendment that I can only assume that through some oversight the words that I suggest —namely,
"with the agreement of the Lord Chief Justice" —
at line 20 have just been left out. The clause deals with presiding judges. Presiding judges were an invention of the Beeching Commission. They have hitherto been appointed by the Chief Justice because

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he is responsible for the judicial administration as distinct from the courts administration. Accordingly one finds in Clause 51(3):
"Any appointment [of a presiding judge] … shall be made by the Lord Chief Justice with the agreement of the Lord Chancellor".
The areas or circuits are then set out, and after identifying the six circuits subsection (3) continues:
"or such other areas of England and Wales as the Lord Chancellor may from time to time direct".
I ask myself the question: why not again with the agreement of the Lord Chief Justice? In the absence of an answer, I can only assume that that phrase has dropped out through a typing error. I beg to move.
The Lord Chancellor: The situation is that obviously if there were to be any change in the circuits the Lord Chief Justice would be consulted and so of course would the other heads of division, because they too would have an interest in this matter since the circuits also deal —and I hope will deal even more—with specialist work not only in the south-eastern circuit in the Royal Courts of Justice. The situation is that, if there were to be any changes in the circuits, a great deal of consultation would require to be held with others: the local law societies, the Bar, the circuit leaders, and so on.
However, this is a matter which I am perfectly prepared to consider further in the light of the fact that I shall reconsider the precise way in which this provision is framed. I had understood the matter to be right, as it was originally put forward, until it was found that it was desired to have perhaps a third presiding judge in one of the circuits. That is the reason for the change, but I am happy to consider this suggestion.
Lord Ackner: In view of the noble and learned Lord's helpful observations, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 51 agreed to.
Clause 52 [District judges]:
Lord Meston Lord Meston moved amendment No. 206A:
Page 40, line 41, at end insert ("and in subsections (3) to (6) of this section, the expression "district judge" shall include district judges of the Principal Registry of the Family Division").
The noble Lord said: In moving this amendment I should like to speak also to Amendment No. 210, and I shall do so as swiftly as I can. Clause 52 merges the offices of county court registrar and district registrar of the High Court into the new office of district judge (or DJ, to which no doubt they look forward to being abbreviated). The clause also makes the registrars of the principal registry of the Family Division into district judges of the principal registry.
As the Committee may well appreciate, the principal registry has both a High Court and a county court jurisdiction. For some reason the powers which are extended by Clause 52 to district judges outside the principal registry are not conferred by this clause
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on district judges within the principal registry. The Committee will be aware that the principal registry deals with cases involving children and family finance which can become highly charged with emotion and can need a measure of firm control. I therefore venture to suggest that district judges of the principal registry should have the same powers as their colleagues elsewhere. I also suggest that it is proper to indicate the status of the district judges in the principal registry by extending to them the judicial oath. I beg to move.
The Lord Chancellor: The intention of the noble Lord, Lord Meston, and the intention that I have are the same. Clause 52(2) states:
"The office of registrar of the principal registry of the Family Division of the High Court shall become the office of district judge of the principal registry of the Family Division".
That is a particular district judge; and he is intended to be included. But in view of the fact that the noble Lord has suggested that clarification is required, I shall certainly consider whether we can achieve it.
Lord Meston: I am very grateful for that indication. It seems to be designated as a distinct office under the Bill in Clause 52 and in the schedule. On the basis that it will be considered, I am happy to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 52 shall stand part of the Bill?
Lord Simon of Glaisdale: Perhaps I may ask my noble and learned friend a question about subsection (2) which deals with the principal registry of the Family Division. As I understand it, first, the Bill effects a change of nomenclature from registrar to district judge. Secondly, it gives the right to commit for contempt. I cannot see —I shall be corrected —that anything else is given.
I wish to draw attention to what seems an anomaly. As I read it, the masters of the Queen's Bench Division are not district judges and do not have power to commit for contempt. Why is that distinction made? I do not think the masters of the Chancery Division are made district judges, nor are they given any power to commit for contempt. I do not know what the position is about the registrars of the Chancery Division, if I still have the nomenclature right.
Has there been any request by the registrars of the Family Division that they shall be given power to commit for contempt? If the masters of the Queen's Bench Division do not need such power, why should the registrars of the Family Division need it? I practised before them for a number of years and was responsible for them for a number of years. I never came across any instance where there was any cause for them to have the right to commit for contempt such as seems to be given to them in this clause.
I desire to say this because it relates to something that my noble and learned friend Lord Ackner said recently. Of the registrars of the Family Division in my time —then the principal probate registry —half were lawyers, mainly barristers. There was one

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distinguished litigating solicitor appointed. The other half were probate clerks from the registry. When I was president, I was asked to hand over the patronage of appointment because even then the Lord Chancellor's Department had started trying to collect patronage although on nothing like the scale vouchsafed by this Bill. I was willing to do so, but I received an undertaking from Lord Gardiner, the Lord Chancellor of the time, that he would continue to have half the registrars appointed from the Bar or solicitors, and the other half continuing to be appointed from the registry clerks. I believe that that is a proper avenue of promotion to be retained. He gave that undertaking, but is it still observed? I imagine that it is.
If so, it means that probate clerks, expert in the administration of probate work, can become district judges with all the other avenues thereafter open. My noble and learned friend referred to them, as did the noble Lord, Lord Hutchinson. I should be grateful if the Lord Chancellor could clear my mind on this point.
11.45 p.m.
The Lord Chancellor: The history of the matter is that the Civil Justice Review suggested that the title "registrar" was open to misconstruction and that people were treating the registrars, who are holders of judicial office, as though they were the same as the people who dealt with births, marriages and deaths. That shows that sometimes even the present nomenclature is not beyond some ambiguity. The Civil Justice Review recommended that the title "registrar" should be changed to a title incorporating the word "judge".
I canvassed as many different variations as I could think of. The ultimate title which appeared to be best, and which most commended itself to the registrars, was that of "district judge". The question is whether one should differentiate between the various registrars. After consideration, the answer appeared to be that one should not. The registrars in the district registries, the county court and the principal registry of the Family Division should have that office. I believe it to be right that if they have the office of a district judge they should have this power.
The masters were consulted and their attitude to the question varied. It may be the case that we shall wish to include them. The title "master" has been regarded as distinctive and there is no risk of confusion between it and other possible types of master, as there appeared to be in the case of the registrars. That is the reason for the present situation.
At present four out of the 13 Family Division registrars are not members of the Bar; the remaining nine are members of the Bar. Therefore, the undertaking given by my noble and learned predecessor to my noble and learned friend Lord Simon of Glaisdale is at present fully implemented. The principle behind my earlier comments also applies in this case; that is, if well performed the service in this office, which is in the nature of performing judicial functions, might well indicate
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the quality which would entitle the person to be considered for promotion.
Clause 52 agreed to.
Clause 53 agreed to.
Clause 54 [Registrar of Criminal Appeals]:
Lord Simon of Glaisdale Lord Simon of Glaisdale had given notice of his intention to move Amendment No. 206B:
Page 42, line 10, leave out ("with the approval of the Treasury").
The noble and learned Lord said: The amendment raises the same question as was discussed very late at night when the noble Lord, Lord Renton, moved a similar amendment on my behalf. It concerns very much the question of how far the Government are at all serious about trying to clear legislation of unnecessary phrases. However, it is now well over one and three-quarter hours beyond the latest time at which your Lordships normally sit. Therefore, I believe that it is better to raise again this matter on Report and I do not move this amendment or the following one.
[Amendment No. 206B not moved.]
Clause 54 agreed to.
Clauses 55 and 56 agreed to.
Clause 57 [Transfer of accrued rights to and from judicial pension schemes]:
On Question, Whether Clause 57 shall stand part of the Bill?
Lord Ackner: I gave notice that I wanted to make a small intervention, stimulated by nostalgic recollections of two old friends. Their position was that they had been county court judges. There were no circuit judges in those days. They were appointed to the county court Bench aged about 52 and were promoted to the High Court Bench after about 12 years which brings them to about the age of 64 or 65.
Their pension position then was, as it is now, lamentable. They could not continue, having reached 54, to be a High Court judge for 15 years because that would take them beyond the age of 75 and thus qualify for a High Court pension of half salary. All they could do was to serve 11 years as a High Court judge and receive eleven fifteenths, or receive a full county court judge pension because they would have served their full period.
That caused me to make inquiries as to why that was. There is rather a venomous Statutory Instrument No. 376 entitled the Superannuation Judicial Offices Aggregation Services Rule 1987 and I am happy to discover, again hot from the press, that that point was picked up in the 13th report of the Top Salaries Review Body published last week at paragraph 73 which states:
"Consideration might also be given to the position of those who are offered promotion within the judiciary from the circuit judge to the High Court judge. In their case they are restricted to taking a pension based either on years of service and final salary in the higher office or on the aggregated years of service at both

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levels and the salary on retirement for the lower office. We feel strongly that as for High Court judges who are promoted to the Court of Appeal",
and I may add, Court of Appeal judges who are appointed to the House of Lords,
"all years of service in the judiciary should count for a pension based upon final salary in payment to the individual at the time of retirement".
That seems a matter which should be looked into, and I raise that now so that thought may be given to it before Report stage.
The Lord Chancellor: I am grateful to my noble and learned friend for raising this matter. I regret that it is most unlikely that I will be able to deal with it before Report stage in any comprehensive way. I propose to say something about the matter in answer to the amendments that my noble friend Lord Coleraine has tabled. They raise the same sort of issue. If my noble and learned friend can wait until then I shall avoid repeating myself.
Clause 57 agreed to.
Clause 58 [Voluntary contributions]:
[Amendment No. 206C not moved.]
Clause 58 agreed to.
Clause 59 [Period of service to qualify for certain superannuation benefits]:
Lord Coleraine Lord Coleraine moved Amendment No. 206D:
Page 45, line 1, leave out subsection (2) and insert —
(" (2) For subsections (1), (2) and (3) of section 7 of the Act of 1981 (rate of pension payable to a stipendiary magistrate) there shall be substituted —
"(1) A stipendiary magistrate in England or Wales may on the recommendation of the Lord Chancellor be granted a pension —

(a) if he retires after 15 years service and at the time of his retirement he has attained the age of 65 years, or

(b) if at the time of his retirement he has attained the age of 70 years, or

(c) the Lord Chancellor is satisfied by means of a medical certificate that by reason of infirmity of mind or body he is incapable of discharging the duties of his office, and that the incapacity is likely to be permanent.

(2) The annual rate of pension payable under this section to a person retiring after not less than 15 years service shall not exceed one half of his last annual salary.
(3) The annual rate of pension payable under this section to a person retiring after less than 15 years service shall not exceed—

(a) if the period of service does not amount to 5 years, 6/40ths of his last annual salary,

(b) if the period of service amounts to 5 or more, one quarter of that salary plus 1/40th for each completed year of service exceeding 5." ")

The noble Lord said: I speak also to Amendment No. 206E. The amendments would change the structure of pension provisions applicable to the lower judiciary in order to bring it more into line with the structure applicable to the higher judiciary and the circuit judges. In particular I see the need to shorten the present length of service required before a full pension is payable. This is on the broad principle that there may be good reason why the
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lower judiciary should receive smaller pensions than their seniors but there seems to be no reason in fairness or fair dealing why they should be required to serve longer for their smaller pensions.
There are, as it will be my principal purpose to show, some compelling reasons not unconnected with the administration of justice why these amendments should be accepted. The amendments are intended to ensure that the right calibre of persons with appropriate professional experience continue to be recruited to the lower judiciary and that there should be no financial reason compelling that person to remain in post when he, his colleagues and those who appear before him, may all be agreed that he should be out at pasture.
The body of persons to whom I refer as the "lower judiciary" is to be found in three courts and can thus be divided into three categories. In the High Court there are the masters. In the county court there are the registrars and assistant registrars, soon to be retitled "district judges" and so referred to in my second amendment. Thirdly, there are the stipendiary magistrates in the magistrates' court, who are the subject of my first amendment.
Common to all these members of the lower judiciary —I do not know how many they number but there must be 300 of them —is the fact that they have traditionally been recruited from the ranks of the practising legal profession at around the age of 50 years. That applies also to circuit and High Court Benches. Another factor they have in common with circuit and High Court Benches is that their full pension entitlement is half their final salary and that in the normal way they must have served 15 years, with the exception of stipendiary magistrates, and reached at least the age of 65 before achieving any pension at all. There is no reduced pension payable on voluntary retirement at an age of under 65.
For retirement with less than 15 years' service—at 72 or earlier on the grounds of ill health —circuit judges are entitled to a reduced pension. Masters and district judges are also entitled to a reduced pension, but only if they have served five years. On the other hand, stipendiary magistrates with at least five years' service may now take early retirement at 65 instead of 72.
My amendments are intended to remove the requirement that at least five years should be served by the lower judiciary before there is entitlement to a reduced pension in order to put them on the same footing as the circuit judges in this respect and also to increase, with the same intention, the fractions of full pensions which will have been earned for each year of service.
The amendments have the effect of removing from stipendiary magistrates the slight anomalous advantage that they can take voluntary retirement on a reduced pension after five years' service. The whole arrangement is made consistent with the circuit Bench. This is a matter to which we can return if my noble and learned friend accepts the amendment or if the Committee sees fit to do so.
The main thrust of my arguments concerning these amendments is intended to be directed at the provisions related to the length of service necessary

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to qualify for full pension. The position of the lower judiciary is undesirably anomalous in that a full pension is payable only after 20 years' service in their case, but it is earned after 15 years' service in the case of High Court and circuit court judges.
That has the effect that, on appointment at the age of 50, a High Court or a circuit court judge may look to retire at the age of 65 on full pension, but a member of the lower judiciary will have to wait until he is 70 before being able to retire on full pension. This period of 20 years was reduced from 25 years as long ago as 1960 in the case of the High Court masters. Even then Sir Frank Soskice, in another place, pointed out how unsatisfactory it was that there should be a 20-year rule when a 15-year rule applied to county court judges. He called for the 15-year rule to apply to High Court masters. The Attorney-General said that he would look at the point, but the matter proceeded no further.
Much more recently the Top Salaries Review Body in its reports in 1982 and 1985 drew attention to this situation. It recognised that it was unsatisfactory. It recommended that the situation be dealt with by legislation and not by adjusting pay differentials. It urged, as I do, that pension arrangements be rationalised.
I feel sure that it is only because the lower judiciary are long-standing offices that we still have the 20-year rule. I feel sure that if they were a new creation the 15-year rule would apply to them. That is borne out by the fact that the more recently conceived chairmen of industrial tribunals are covered by the 15-year rule. I see harm being done to the administration of justice by the continuance of this rule. The supply of good, practising barristers and solicitors in middle life who are prepared to take on the relatively unglamorous but vital work of the lower judiciary is, I am told, drying up both in the face of comparably greater earnings outside in the professions and in the face of this altogether unreasonable retention of the 20-year rule.
Like the noble and learned Lord, Lord Ackner, I wish to read from the report of the Top Salaries Review Body which was published last week. The report states:
"In past reports we have also referred to the discrepancies in pension arrangements for different judicial posts within the same country. For example, Stipendiary Magistrates in England are required to serve for 20 years for a full pension. It has been put to us strongly that this is a particular disincentive to recruitment to these posts and not in the public interest. Our judicial sub-committee has taken the view in the past that the proper way to deal with pensions anomalies which were seen as clearly inequitable was by amending the legislation concerned, not by adjusting salary relativities. We have urged in the past, as in our reports in 1982 and 1985, that the present pension anomalies should be removed as soon as possible, but no such changes have been made".
That is what I am asking for this evening. I beg to move.
12 midnight.
Lord Irvine of Lairg: I would like to bring the support of these Benches to both these amendments. I focus on Amendment No. 206E which is designed, among other things, as the noble Lord said, to remove an inequality which the High Court masters
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suffer in their pension rights. They have to toil on for 20 years before they qualify for a full pension, but not so circuit judges or chairmen of tribunals. They have to complete only 15 years. So the noble Lord asks why should not the masters qualify for full pension after 15 years? It is too hard to require them to work on after 15 years, regardless of health, for a further five years in order to qualify for full pension.
I should have thought that High Court masters bring to their office skills and experience probably as great as are required of circuit judges or tribunal chairmen. They require knowledge of the civil law over the widest field to handle the huge variety of work that comes before them. Their job is arduous and their jurisdiction is important. They can, for example, give summary judgment —that is, without a trial —in claims involving large sums of money. That is to mention one of their other many important functions.
I cannot think of any ground on which they could be regarded as judges whose judicial role is inferior to that of circuit judges or chairmen of tribunals in the sense of the nature and the difficulty of the work they do, the skills and experience they provide or the market value they have considered as legal practitioners at the time of recruitment. I dare say that we may be told, in accordance with the law of unright time or occasion, that this Bill is not the appropriate place or this is not the appropriate time to do something to remedy the anomaly to which the amendments call attention. But I wonder whether in replying to the amendments the noble and learned Lord can say that he agrees in principle that the inferior pension rights of masters and others is an anomaly and that he is in favour of taking steps on some other and suitable (and it is to be hoped not too far distant) legislative occasion, if this occasion is inappropriate, to remedy the inequity and the anomaly.
Lord Benson: I am anxious to support the amendment. However, I do not want to go through all the reasons as that would take a little time. I understood from what the noble and learned Lord the Lord Chancellor said a few moments ago in relation to another amendment that he would look into this matter. If that is the case it would save time if he could help us on that point.
The Lord Chancellor: I am grateful to the noble Lord. I have sought to bring forward in Clauses 57, 58 and 59 and Schedule 9 the necessary amendments to the judicial pensions schemes, which are generally speaking in primary legislation, to bring them into line with the requirements of the Social Security Acts of 1985 and 1986. The judicial pensions schemes are extremely complicated, as anyone who has tried to understand them knows. They carry a good number of difficulties for those who have to try to make out their rights under them.
The situation calls for radical examination of pension arrangements. This is particularly clear in the light of the latest Top Salaries Review Body report in relation to pension law and practice generally. This is not by any means a matter that

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one can deal with briefly. I have already had some preliminary contact with the difficulties involved. But I can inform the Committee that along with my officials I hope to undertake such an exercise within the next few months in the hope that we shall be able to come forward with a revised scheme as soon as legislative time permits. It is hard for me to say how soon that may be, but we certainly intend to go into the detailed planning of the structure as soon as possible—within the next few months is what I have in mind. It is bound to take some time to do that, but I assure the Committee that there will be no unnecessary delay although some delay is inevitable because of the nature of the work that has to be done. I hope that that is the type of indication for which the noble Lord, Lord Irvine of Lairg, was asking and I give it in answer to the amendment tabled by my noble and learned friend Lord Ackner, and my noble friend Lord Coleraine, supported as they have been.
Lord Renton: I am sure that we are all most grateful to my noble and learned friend the Lord Chancellor. There is only one point that should be added to what has already been said and which he may wish to bear in mind when giving further thought to the matter. It is that broadly speaking people are not appointed as stipendiary magistrates or masters of the High Court until they have reached the age of 50 or more. That is the usual practice.
Viscount Dilhorne: Perhaps I may assist the Committee. I believe that the last two members to be appointed as masters were aged 54 and 55. It was nearly 29½ years ago on 11th November 1960, when my father, as Her Majesty's Attorney-General, moved the Second Reading of the Administration of Justice (Judges and Pensions) Bill. As my noble and learned friend said, during the course of the Bill the eminent lawyer Sir Frank Soskice vigorously, but in vain, tried to convince my father that stipendiary magistrates, High Court masters and the lesser judiciary should qualify at 15 years. He was partly successful because I understand that my father gave way from 25 to 20 years. That was 29½ years ago. I hope that within the next three months my noble and learned friend the Lord Chancellor will be able to see whether all the judges, lesser and higher, can be on the same pension basis. If he cannot, I shall look forward to hearing why there should be what seems to me, in a rather simple way, to be a distinction of some unfairness.
Lord Coleraine: I have listened to what my noble and learned friend has said. I wonder whether he feels that at the end of his review he will be in a position to introduce the primary legislation that the provision would require, and when it might happen, because these occasions do not happen all that often. This seems to be one of the times when such a rationalisation could take place.
The Lord Chancellor: As I have said, the first thing to do is to think out what the scheme should be, which is an onerous task, as I am sure my noble friend appreciates. Anything to do with pension schemes is complicated, and this one is particularly
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so because there is a wide variety of anomalies, some of which have been touched upon.
I do not envisage a timescale of 29½ years, but the timescale for the review will at the very least be a matter of some months, as I have said. I hope to be able to bring forward legislation when legislative time permits thereafter. I hope that it will not be too long deferred. My noble friend will appreciate, as I am sure the Committee does, that it is not appropriate for me to try to forecast when it might come forward. The Committee can take it that I shall do my best to bring it forward as quickly as I can.
Lord Coleraine: Some months is quick, but it is what comes after that will be of interest to us all ultimately. It is clear that my noble and learned friend is fully appraised of the injustice and of the unsatisfactory effect that the provision of judicial pensions has on recruitment, to mention just one point. In the circumstances, at this time of night the best thing that I can do is ask the Committee for leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 206E not moved.]
Clause 59 agreed to.
Schedules 8 and 9 agreed to.
Clause 60 agreed to.
Clause 61 [Commencement; expiry and replacement of practising certificates]:
[Amendment No. 207 not moved.]
Clause 61 agreed to.
Clauses 62 to 67 agreed to.
12.15 a.m.
Lord Byron Lord Byron moved Amendment No. 207ZA:
Before Clause 68, insert the following new clause:
("Power of parties in certain cases to supply vacancy.
. —(1) For section 7 of the Arbitration Act 1950 (power of parties in certain cases to supply vacancy) there shall be substituted—
"Power of parties in certain cases to supply vacancy.
7. Where an arbitration agreement provides that the reference shall be to two arbitrators, one to be appointed by each party, or that the reference shall be to three arbitrators, one to be appointed by each party and the third to be appointed by the two appointed by the parties or in some other manner specified in the agreement then, unless a contrary intention is expressed therein —

(a) if either of the appointed arbitrators refuses to act, or in incapable of acting, or dies, the party who appointed him may appoint a new arbitrator in his place;

(b) if, on such a reference, one party fails to appoint an arbitrator, either originally, or by way of substitution as aforesaid, for seven clear days after the other party having appointed his arbitrator, has served the party making default with notice to make the appointment, the party who has appointed an arbitrator may appoint that arbitrator to act as sole arbitrator in the reference and his award shall be binding on both parties as if he had been appointed by consent:

Provided that the High Court or a judge thereof may set aside any appointment made in pursuance of this section.
(2) Section 58 of the Administration of Justice Act 1985 shall cease to have effect." ").
The noble Lord said: We now come to that part of the Bill which deals with the law of arbitration. I hesitate to introduce a rather technical amendment at 15 minutes past midnight, and I shall do so as quickly as I can.
The purpose of the amendment which stands in my name is to substitute for the existing Section 7 of the Arbitration Act 1950 a new Section 7, which will apply not only where the reference is to two arbitrators but also where the reference is to three arbitrators. Section 7 deals with the situation when one party fails to appoint an arbitrator and it allows the other party, in certain circumstances, to appoint his own arbitrator as sole arbitrator. It is a valuable procedure which entails the minimum of delay and expense in obtaining a properly constituted tribunal in the circumstances where one party, after due notice, fails to appoint his own arbitrator. I have written to the noble and learned Lord the Lord Chancellor on this point and I can avoid therefore going into too much detail now, or into the history of how the law comes to be in the state it is in now.
To put it very simply, there are two separate procedures laid down in the 1950 Act. If the arbitration reference is to two arbitrators and an umpire then, if the opposing party fails or refuses to appoint his arbitrator, you use the Section 7 procedure to appoint your arbitrator as sole arbitrator. However, if the arbitration reference is to three arbitrators, then the Section 7 procedure is not available and you have to use what is now Section 10(3) of the Arbitration Act 1950, as inserted by Section 58 of the Administration of Justice Act 1985.
The purpose of my amendment is to make the Section 7 procedure available in both cases. There is no logical reason why different procedures should apply, depending on whether the arbitration reference refers to two arbitrators or to three arbitrators. Both forms are in widespread use. I believe that the Section 7 procedure has proved to be speedy and efficient over many years and there is no good reason for laying down a different procedure which makes necessary an application to the court.
Moreover, there does not seem to be any good reason why, if one party refuses to appoint an arbitrator, the other party should be encumbered with a tribunal of three arbitrators which he will be responsible for paying for. If a party is refusing to appoint an arbitrator, the likelihood is that he will also seek to avoid enforcement of any award, leaving the original party to pick up the bill for all three arbitrators.
I am aware that the procedure under Section 7 is against the international trend with regard to appointing an arbitrator in default and it is not, for instance, the procedure which was adopted by the UNCITRAL Model Law on International Commercial Arbitrations. However, the departmental advisory committee expressly rejected the implementation of the Model Law, and in considering Article 11 of the Model Law which deals with appointment of arbitrators, the committee, under the chairmanship of the right honourable Lord Justice Mustill, commented at page 24 of the report:
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"This article is inconsistent with the present law, under which default in the appointment of a second arbitrator may result in the first being appointed sole arbitrator: this is a valuable provision in cases where the respondent has no real wish to see progress made with the arbitration."
It would appear therefore that the departmental advisory committee sees considerable value in the existing provisions of Section 7 of the Arbitration Act, and I would pray this in aid in support of my amendment to extend Section 7 to deal with the position where the reference is to three arbitrators.
Finally, perhaps I may make a point which I did not raise in my letter to the noble and learned Lord. If it is thought for some reason that the provisions of Section 10(3) should remain —that is the procedure whereby an application to court is required —consideration could still be given to amending Section 7 in the way that I have suggested.
There is a precedent for a dual right. The power of the court under Section 7 applies not only to the failure by one party to appoint any arbitrator at all, but also to a failure to replace an arbitrator who has refused to act, is incapable of acting, or dies. This means that where there is an argument for two arbitrators, and there is a refusal, incapacity, or death of one arbitrator, the party who appointed the other arbitrator has a choice of two procedures. He can apply to the court under Section 10 for the vacancy to be filled, the result being a renewed tribunal consisting of two arbitrators. Alternatively, without the assistance of the court, he can appoint his own arbitrator to act as sole arbitrator.
Perhaps I may quote from a leading authority on arbitration, Mustill and Boyd say:
"The second alternative is plainly cheaper and more advantageous for the appointing party, and it is the one which in practice is almost always employed".
If this route were to be taken, the claimant could either appoint his arbitrator as sole arbitrator, or if he had reservations about problems of enforceability then he could adopt the Section 10 procedure. I appreciate that the amendment, which is my own, may be capable of improvement. I realise that this is a matter of which the noble and learned Lord has not had much notice. He will wish to take proper advice on it. I beg to move.
Lord Ackner: I have had an opportunity of discussing this matter shortly with my noble and learned friend Lord Goff of Chieveley. As Members of the Committee know, he is perhaps the Law Lord most acquainted with the complications of arbitration. He would have been here tonight but for the lateness of the hour. Members of the Committee may find his view helpful. It is that the departmental committee on arbitration law reform to which the noble Lord, Lord Byron, referred, formerly known as the Mustill Committee and now the Steyn Committee, after Mr. Justice Steyn, is considering the consolidation of the whole of statutory arbitration law at the moment.
This is a technical matter, as has been very fairly conceded by the noble Lord, Lord Byron. Its technicalities may be such that it would be more appropriate, assuming that it has much merit (as is no doubt the case), for it to be referred to that

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committee rather than dealt with in legislation in the Bill in this way. I merely offer that as a view for the Committee's consideration.
The Lord Chancellor: I am very grateful to my noble and learned friend for giving us the opinion of my noble and learned friend Lord Goff of Chieveley, and to the noble Lord, Lord Byron, for raising the matter. I can see the attraction of what the noble Lord has suggested. The course I propose to take is that I should have an opportunity of consulting the departmental advisory committee on arbitration. Depending on its attitude to the matter, we might be able to deal with the point during the course of the Bill. If there is great difficulty about it we should have to leave it over. If the noble Lord would care to leave it with me on that basis, I undertake to bring it to the committee's attention and see what its attitude to the matter is.
Lord Donaldson of Lymington: I support the alternative of dealing with it in this Bill after taking advice. All experience shows that a missed legislative opportunity tends not to recur until much later than people expect when they postpone a matter.
The Lord Chancellor: I shall do that if I possibly can.
Lord Byron: I am very grateful for what the noble and learned Lord has said. In the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 68 agreed to.
Clause 69 [Specific powers of arbitrator exercisable by High Court]:
Lord Donaldson of Lymington Lord Donaldson of Lymington moved Amendment No. 207ZAA:
Page 53, line 29, leave out ("section 11 of the Act of 1950") and insert ("section 35 of the Supreme Court Act 1981").
The noble and learned Lord said: This is not a point upon which I think anybody will need to take advice. It is a simple point. When one looks at Clause 69 in Part V which relates to arbitration one finds that the clause does not relate to arbitration at all. It relates to litigation and the powers of the High Court exercisable in litigation and not in arbitration. It is true that by reference it will derive those powers from an arbitration agreement but as regards logic it could equally have provided that the High Court should have any powers which the parties chose to agree upon. That would equally have worked and have had nothing to do with arbitration.
If I may say so with respect, the right Act for this amendment —an amendment with which I am in complete sympathy and one required by the official referees for a number of reasons—is the Supreme Court Act 1981. That is the Act which regulates the jurisdiction of the High Court in general and the official referees in particular. I have looked at the Supreme Court Act to find an appropriate spot in which to lodge the amendment. I believe that that
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would be immediately following Section 35. However, I agree that there may be other views on the matter. I have listened, as the Committee has wound its weary way through this stage of the Bill, to variations on the theme of the words, "I shall give consideration", "I shall give favourable consideration", "I shall give very favourable consideration". I shall accept any such formula of words as I realise that on Report I can alter the place where the provision should be inserted or even the Act into which it should be inserted. However, quite plainly, it has no business to be in the Arbitration Act 1950.
A further point, apart from that of logic, is that in terms of the marketability of arbitration, which is of some importance to this country in the context of foreign commercial arbitration, the fewer references which appear in the Arbitration Act to the High Court the more acceptable, I am advised, it is to foreigners. As a judge of the High Court, or at any rate of the Supreme Court, I must accept, although I am ashamed to do so, that we may like to think of ourselves as an ornament but we are certainly not that in terms of those who wish to indulge in arbitration from abroad. I beg to move.
Lord Ackner: This is not a de minimis interjection. I hope it is a minuscule one but there is already a Section 35A of the Supreme Court Act 1981 so perhaps, mutatis mutandis, some change might be made.
The Lord Chancellor: That demonstrates the wisdom of the formula I was going to use. I accept this amendment in principle. I shall check with the draftsman on its detail and hope to include it in an acceptable form to all of us on Report.
Lord Donaldson of Lymington: In the light of that helpful reply, albeit not quite as helpful as I had hoped for, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Chairman of Committees (Lord Aberdare): I call Amendment No. 207ZAB.
Lord Donaldson of Lymington: That matter does not arise now. I do not move the amendment.
[Amendment No. 207ZAB not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 207ZB:
Page 53, line 33, leave out ("clause") and insert ("agreement").
The noble and learned Lord said: This amendment substitutes a reference to an arbitration agreement for the present wording of "an arbitration clause" in order to be consistent with the statutory language presently used. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 207ZC:
Page 53, line 35, leave out ("proceedings") and insert ("agreement").
The noble and learned Lord said: This amendment has the effect of requiring the agreement of the parties to the arbitration agreement, rather than that of the parties to the court proceedings, before the court can exercise the powers conferred in the new Section 11 A of the Arbitration Act 1950. I beg to move.
On Question, amendment agreed to.
Clause 69, as amended, agreed to.
12.30 a.m.
Clause 70 [Want of prosecution]:
[Amendment No. 207ZCA not moved.]
The Earl of Lytton The Earl of Lytton moved Amendment No. 207A:
Page 53, line 40, after ("claim") insert ("defence or counterclaim").
The noble Earl said: It may be for the convenience of the Committee if in moving Amendment No. 207A I speak to Amendments Nos. 207B, 207C, 207D and 207E, which are all interrelated.
The series of amendments attempts to ensure that where there is a failure to prosecute a case before an arbitrator the failure to prosecute will attract the attention of the Bill not only at the point of the initial claim but also where it falls into the realms of counterclaim. I feel very strongly that if we are not careful the case will go merely from the initial claim to the counterclaim and will stick there. The purpose of the amendments is to try to overcome that.
The noble and learned Lord the Lord Chancellor may tell me that for procedural reasons the amendments are unnecessary. I should be grateful for his assurance on the matter. I beg to move.
Lord Hacking: I believe that the amendments should be supported in principle. A horrendous delay may equally be caused by a defendant in proceedings as by a claimant.
Lord Donaldson of Lymington: Subject to anything that my noble and learned friend the Lord Chancellor may say, I should have thought that for this purpose claim would include counterclaim because it is the claim of the defendant. It may be clearer to refer to counterclaim. However, I am quite sure that one cannot include defence because one cannot dismiss a defence for want of prosecution, much as we should like to on many occasions.
Lord Mishcon: I believe that it is also right to say that an arbitrator has complete power, if a defence has not been filed, to hear the claim or the counterclaim.
The Lord Chancellor: In principle I accept the view that the provision ought to apply to a counterclaim. I should like to check to be sure whether or not the amendment is necessary in that respect.
So far as concerns the defence, I do not believe that it would be right to apply that system. There are other obstacles to a late defence, such as those that have been mentioned. In principle,
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counterclaim could be included if necessary, but not defence. I hope that that is a sufficient answer to the noble Earl. I am grateful to him for raising the matter.
The Earl of Lytton: I apologise to the Committee for trying to include something that should not properly be there. That must be put down to my lack of knowledge of the correct wording that applies in such cases. In the circumstances I believe that the noble and learned Lord the Lord Chancellor has given me as good an answer as I could possibly expect at this time of night. Perhaps I may leave the matter in his hands for the time being. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 207B and 207C not moved].
Lord Donaldson of Lymington Lord Donaldson of Lymington moved Amendment No. 207CA:
Page 53, line 47, leave out ("delay") and insert ("length of time which has elapsed since the cause of action arose").
The noble and learned Lord said: This is an important point which has to be seen in the context not only of the amendment but also of Amendment No. 207EB, which I shall mention shortly.
The House of Lords in its judicial capacity held that an arbitrator had no power to dismiss a claim in circumstances analogous to the power possessed by the High Court to dismiss a claim in which there has been inordinate and inexcusable delay and the delay has given rise to a substantial risk that it is not possible to have a fair resolution of the issues in that claim or has caused, or is likely to cause or to have caused, serious prejudice to the opposite party. In putting forward the Bill, the Government have obviously taken the view, with which I entirely agree, that it is right that arbitrators should have that power.
However, two problems have arisen. First, the High Court power is a judge-made power and it will always be possible for the judges to alter it. It might require the House in its judicial capacity to exercise the power of flexibility under the practice direction whose year I forget, but it could be done. However, once the analogous power for an arbitrator is enshrined in primary legislation, we are stuck with the present rule in relation to litigation unless the two powers are to diverge, which is highly undesirable.
I am therefore forced at this stage to look carefully at the judicial rule which applies in the High Court. I must tell the Committee that for those who —I again use the phrase that I used earlier —labour at the judicial coalface, that rule is highly unsatisfactory. I have not met a Lord Justice who is prepared to begin to defend it.
Let me explain why it is unsatisfactory. It is well settled and no one would quarrel with the fact that, Parliament having said that one has three years in the case of a personal injuries claim and six years in most other claims in which to issue one's writ, one's delay in issuing the writ over that period cannot be described as inordinate, still less as inexcusable, because Parliament has given one the right so to delay. So none of that problem arises within

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whatever time the claimant or plaintiff chooses to take issuing his writ, provided it is within the statutory period. However, it has been said over and over again by this House in its judicial capacity that, when one issues one's writ, one should get a move on with the action or the arbitration. The later one issues the writ, the more of a move on one should get. I know that that is not good English, but I hope that it at least expresses my view.
Perhaps I may now describe the problem that has arisen. A typical scenario is six years to issue a writ and an additional year to serve it, but let us leave that aside as a complication. The action then starts with an enormous amount of gusto. A statement of claim is served; a defence is served and sometimes one even gets around to discovery or the beginnings of discovery. At that stage the action goes to sleep. Three years later, by which time we have reached year nine or ten, the defendant says, "Enough is enough" and applies to strike out the action for failure to prosecute him.
The plaintiff usually wraps it up a bit, but stripped down to its essentials he says at that point, "I did not delay inexcusably or at all inordinately up to the end of the six years". That is right. He then goes on to say, "I got quite a move on for the next 12 months" and the judge says, "That's right". The plaintiff goes on to say, "For the next three years I delayed inordinately and inexcusably, but you cannot strike my claim out". The judge says, "Why can't I?" Although it is no doubt true that there is by now a substantial risk that it will not be possible to have a fair resolution of the issues in the claim and that there has been serious prejudice to the defendant, all that prejudice and that lost opportunity to have a fair trial arose before he started delaying. It is not therefore that delay which created the impossible situation.
The plaintiff wraps it up a little, but when one has heard that excuse three times a week for all the sitting weeks of the year, one gets a little fed up with the wrapping and wants to undo the parcel and do something about the contents. Hence this amendment that I put forward. If there is inordinate and inexcusable delay after the expiration of the limitation period —and before then I accept that delay must be excusable —the claimant should be at mercy and the courts be able to look at the whole period of delay and ask itself what I should have thought would be the central question at that time: "Sitting here now, 10 years, eight years or whatever after the cause of action arose, can we fairly try this action?" If the answer is no, the court ought to be entitled to throw it out. That should apply similarly but with less emphasis to the case of prejudice.
It is a very simple amendment that I propose; namely, to remove the word "delay" from the last line on page 53 and substitute:
"length of time which has elapsed since the cause of action arose".
I have no doubt that this amendment will achieve the object that I have outlined. The Committee will find that in a subsequent amendment similar, almost identical words are used in order to bring the High Court into a similar position to that which an
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arbitrator would have when this Bill becomes an Act. There have to be one or two very minor alterations merely to fit the different language of the High Court. I have talked about a respondent to that claim to make it clearer. But subject to that, the principle that I have sought to follow is exactly the same for both the High Court and for arbitration.
If I might beseech the Committee, my form of beseeching would be that you do not enshrine in primary legislation a judicial rule which, with all respect to this Chamber and its judicial capacity, is wholly wrong in practice and largely unworkable. In fact, if the truth had to be told —and this is not a matter upon which I care to tell the truth —a good deal of judicial cheating goes on to make the thing work at all. I beg to move.
Lord Mishcon: I rise at once in support of this very sensible amendment. With great respect I also bring to the attention of the Committee that it is not just the practitioners who sometimes produce a case in which there is prejudice to both parties by virtue of the length of time taken in the action coming on to trial. It ought to be known to the Committee —and I am sure that the noble and learned Lords the Master of the Rolls and the Lord Chancellor know it —that if an action is set down for trial now in the Queen's Bench Division, or indeed in the Chancery Division, one will be told that there is no chance of that case being heard until 1992.
That is the position that I can state factually to be true with regard to a Chancery case in which a plaintiff has been defrauded by one of the partners of a firm of solicitors. The gentleman concerned has been extremely naughty and is now in prison —but I shall say no more about the firm or the person in question. It is dreadful to have to tell a client —as had to be done —that an action set down and dealt with with promptitude all the way along, so far as the practitioners were concerned, stands no chance of being heard in the Chancery Division until some time in 1992. It may be half way through 1992 or even late in that year. So it is not just a matter that concerns the practitioners; it is delay in the hearing of cases.
I know that the noble and learned Lords the Master of the Rolls, the Lord Chief Justice and the Lord Chancellor are all doing their best. But I assure the Committee that this is as difficult for public consumption as indeed is the case of the delay.
Lord Donaldson of Lymington: Perhaps I may intervene before the noble Lord sits down. Of course that is right. It is very often the litigants and not the practitioners who are responsible for the delay. But the other reason that I wished to intervene is because I can speak for the Civil Division of the Court of Appeal. I can tell the noble Lord that if he had an urgent appeal I would put it on tomorrow morning —no, this morning—or at whatever notice was required by the justice of the case. However, I think that he has done an injustice to my noble and learned friend the Lord Chief Justice. On the Queen's Bench Division, the time intervals between trials and setting down are, or can be, shorter in appropriate cases than the example referred to of

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1992. But I am not informed about it. It is merely an impression that I have that times of delay have been very substantially reduced within the past few months.
12.45 a.m.
Lord Ackner: I should like to add to that. I had details and I gave the Committee some of those details during the course of the debates. My recollection is that in a Queen's Bench action the lead time is now 10 weeks. I instanced a case where it was less than that. I had the periods for the Chancery Division and the other divisions. They are nothing like the noble Lord, Lord Mishcon indicated. I can give them to him at a later stage. I have the deails in my room upstairs.
Lord Mishcon: I am most grateful to the noble and learned Lord. He will have noticed, I hope, that I quoted an actual example, and stated what the case was. I can tell him with all reliability and very great carefulness about what I say, that the anticipation is that the case in question set down a couple of weeks ago cannot come into the list until half way through 1992. I am sure that the noble and learned Lord will accept that from me.
The Lord Chancellor: The amendment that my noble and learned friend has proposed is a very interesting solution to the problem of delay. I know that the rules set out by this Chamber in its judicial capacity have proved to be somewhat difficult in application in the day-to-day work of dealing with these matters.
I am in a certain difficulty. I believe that it would be right to have fairly wide consultation on the question of what the rules should be in the High Court. That is not what I have addressed in this clause. On the other hand, this clause is put into the Bill as a result of advice given by the departmental advisory committee. It takes the view that it would be right to set out in the legislation the High Court's jurisdiction in this matter in order that it may be applied to arbitration, and that it will not be good enough simply to say that arbitrators have the same powers as the High Court. The arbitrators and the parties may not be familiar with the High Court practice in this regard. The advice of the advisory committee was that if we did not put this provision on the face of the Bill, the result was likely to be long and costly hearings between the parties which would not in the nature of things be an advantage, and that we ought to put it on the face of the Bill.
Putting such a provision on the face of the Bill requires one to know what it is. It is therefore difficult to achieve both these aims within the timescale that we have. If my noble and learned friend is prepared to leave it with me, I would wish to obtain as quick an impression as I can from the Supreme Court Procedure Committee and possibly also from the departmental committee about whether this proposal is generally regarded as acceptable. I have no doubt that it merits consideration. I have had some comments of a preliminary kind made about it by some of my colleagues which suggest possible refinements. I am
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sure that my noble and learned friend would like us to have the best rule we can. I believe he would also agree that it is right, if at all possible, that we should express on the face of the statute what the rule for arbitration is to be.
Lord Donaldson of Lymington: I accept entirely what the noble and learned Lord the Lord Chancellor has said. It is correct that the departmental committee wanted the law to be set out on the face of the Bill and I should not dream of disagreeing with its expert view. However, the chairman of the committee said that in that capacity he did not feel free to consider what the High Court rule should be, and that must be right. All he was considering was how to convey that to the arbitration fraternity whatever the rule. It may well be that if he was free to consider the matter and apply his mind to it, he would take the view that I have been putting forward.
There is no doubt that the Supreme Court Procedure Committee can meet quickly and supply my noble and learned friend with whatever advice it thinks appropriate. There is also no doubt that every member of the Civil Division of the Court of Appeal can meet quickly and supply their opinion. I cannot influence or convene a meeting of the judicial Members of your Lordships' House, but the Lord Chancellor can do so easily and receive their answer. The Bar Council could probably produce a quick answer but, unfortunately, the Law Society would take longer because it is such a large organisation. However, I am sure that the president's action could cover that in an appropriate case.
In all the circumstances, it is appropriate that I should withdraw the amendment. I hope to see something in its likeness appearing early in the next stage of the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 207D and 207E not moved.]
Clause 70 agreed to.
Lord Byron Lord Byron moved Amendment No. 207EA:
After Clause 70, insert the following new clause:
("Service of proceedings on an oversea party.
. After section 25 of the Act of 1950 there shall be inserted—
"Provision for service on oversea parties.
25A. —(1) Unless a contrary intention is expressed in the Arbitration Agreement, any process or notice required to be served, on a relevant party in connection with any application concerning the conduct or regulation of a reference or any award made therein, to the High Court, under this Act or any other enactment making provision with respect to Arbitration (whenever passed), may be served, notwithstanding any rule of Court to the contrary, by leaving it at or sending it by post to the business address of the solicitor or other person or body —

(a) who is acting for the party in the reference in connection with which service of the process or notice in question is to be effected; or

(b) in the case where any award has been made, acted for that party in the reference in connection with which service of the process or notice in question is to be effected.

(2) In this section a "relevant party" means either —

(a) an individual who is a national or habitually resident in any State other than the United Kingdom; or

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(b) is a body corporate incorporated in, or whose central management and control is exercised in any State other than the United Kingdom.

at the time service is effected.
(3) Nothing in this section shall affect any application for the appointment of any Arbitrator or Umpire or to extend the time for making any such appointment, other than by way of substitution or the enforcement of any award." ").
The noble Lord said: The amendment is another to the Arbitration Act. It is of a technical nature although it has even greater value than the previous amendment. Its purpose is to facilitate on parties resident abroad service of the originating process by which applications to the court are made in connection with arbitration proceedings and subsequent appeals.
Under the Arbitration Acts of 1950 and 1979 the High Court is entrusted with wide powers to supplement the powers of arbitrators in the conduct of a reference; for example, Section 12 of the 1950 Act. Equally important are the powers entrusted to the High Court to monitor and regulate the conduct of the reference, including the power to entertain an appeal on points of law.
In order to invoke any of the supervisory powers of the High Court it is currently necessary to arrange for the issue of originating process which, in turn, requires compliance with the strict rules as to the service of such process. That can be particularly time consuming and expensive in the case of parties resident abroad.
Often in practice there are two solicitors almost next door to each other, perhaps in the City of London, conducting arbitrations vigorously against each other for a long period of time. One of them wishes to invoke the powers of the High Court and is unable to serve the necessary originating summons, or whatever is required, on the solicitor next door. He must then ask whether that solicitor has leave to accept the service. If he does not receive a favourable response, he must then go to the High Court either to seek an order for leave to serve out of the jurisdiction or for substituted service.
The opportunities for tactical delay and prevarication, which the requirement for strict compliance with the rules for service provide, were recognised in the working paper dated 1st February, 1985, produced by the sub-committee on arbitration which is a sub-committee of the Commercial Court Committee. Paragraph 64 states:
"the efficacy of many procedures offered by the 1950 and 1979 Acts would be improved if provision were made facilitating service of the originating process by which application to the court is made, this is particularly so in relation to those applications which are typically made at a relatively late stage in an arbitration (e.g. for security for costs or for an 'extension order' under Section 5 of the 1979 Act), where it is commonplace to encounter a tactical refusal to authorise solicitors to accept service, despite the fact that they may have had the conduct of the arbitration on their Clients' behalf for a considerable time".
I believe that all those engaged in arbitration would find this a useful amendment. It has not been possible to bring in something along these lines. I believe that the difficulties which have been encountered are perhaps two-fold. First, as the authors of the 1st February working paper recognise, the solicitor or other representatives of a party in a
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reference are not technically on the record. I do not consider that there is any need for the special provision on this aspect. In practice, there is rarely any doubt as to who has conduct of an arbitration on behalf of a party. In the rare case where a doubt arises, the type of inquiry with which a court will be faced will not differ in essence from that which arises in relation to any contested service issue.
The second right which the amendment seeks to give could be nullified if a party withdraws instructions from the solicitor or other representative. In practice, that is likely to be rare in the context of applications and ongoing reference.
I recognise that it may be said that this matter is more appropriate for the rules committee, and that seems to have been the view of the sub-committee on arbitration. In my view, this issue is appropriate for statutory provision and the present Bill is an appropriate vehicle for such an amendment. Matters of service are not exclusively dealt with by the rules and, indeed, arguably most service is regulated by statute by virtue of the provisions of the Companies Act which now overrides the rules as to service on corporations. It also appears that the rules committee has not been able to find a solution to the problem since the recommendation to which I referred was made in 1985.
Finally, I was grateful to the noble and learned Lord, Lord Ackner, for what he said. The noble and learned Lord, Lord Goff of Chieveley, has also written to me in relation to this amendment. I beg to move.
Lord Mishcon: I can well understand the difficulty which the noble Lord brings before the Committee and it is right that he should do so. However, since I do not disagree with the principle, I ask only that the practical aspects of this matter are considered by the Committee, and especially by the noble and learned Lord, before this becomes part of an enactment.
I say that because of the very difficulty which the noble Lord correctly pointed out; namely, that in court litigation, a solicitor is on the record and until he is removed from it he is deemed to be there as the solicitor, agent and representative of the party in respect of whom he is acting, as is shown on the record. Therefore, service is a perfectly simple matter to effect. You effect it upon the solicitor concerned.
That is not the position in arbitration proceedings. Especially when the person to be served is abroad, it may very well be a disputed matter of fact as to whether or not, at the time of service, the solicitor is actually the solicitor for the party.
After the arbitration has been completed by an award, it is an even more difficult question of fact to know that the solicitor is still acting for the party concerned. Therefore, I merely rise to point out the difficulties while at once accepting from the noble Lord, Lord Byron, that there is a difficulty here which perhaps should be looked at. In principle it sounds all right but there are practical problems.
The Lord Chancellor: I believe that there are quite important practical problems although I see the force of the noble Lord's amendment. I am happy to consider it. I think it may be difficult to have adequate consultation on this very quickly but I shall see what can be done, if the noble Lord is prepared to leave it on that basis.
Lord Byron: I am grateful for what the noble and learned Lord said. I hope this matter can be considered reasonably quickly. It is a matter which was considered in 1985 by the sub-committee to which I referred. There will be very little dispute about the desirability of finding a solution to the problem. It may be that my amendment is not perfectly drafted in that respect; but to answer the point made by the noble Lord, Lord Mishcon, there certainly could be difficulties as to whether a solicitor, for example, was still acting for a party. Similar problems arise under the Companies Act as to whether a company is still carrying on business within a jurisdiction and similar problems arise under other legislation.
In relation to withdrawal of instructions, I doubt whether it is desirable that a party who has participated in a reference through a solicitor within the jurisdiction should be able to avoid service of appeal procedure simply by withdrawing those instructions. Ultimately the only hardship that could accrue to the solicitor concerned would be simply the obligation to pass on documents to his former client. However, in view of what the noble and learned Lord said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Donaldson of Lymington Lord Donaldson of Lymington had given notice of his intention to move Amendment No. 207EB:
After Clause 70, insert the following new clause:
("Want of Prosecution.
.After section 35 of the Supreme Court Act 1981, there shall be inserted—
35B. —(1) The High Court shall have power, whether of its own motion or on application by a party to the proceedings, to dismiss any claim in those proceedings where it appears to it that the two conditions mentioned in subsection (2) are satisfied.
(2) The conditions are —

(a) that there has been inordinate and inexcusable delay on the part of the claimant in pursuing the claim; and

(b) that the length of time which has elapsed since the cause of action arose —

(i) will give rise to a substantial risk that it is not possible to have a fair resolution of the issues in that claim; or

(ii) has caused, or is likely to cause or to have caused, serious prejudice to the respondent to that claim." ")

The noble and learned Lord said: This amendment related to an earlier amendment and accordingly I do not move it.
[Amendment No. 207 EB not moved.]
Clause 71 agreed to.
Clause 72 [Tying-in arrangements]:
The Earl of Lytton The Earl of Lytton moved Amendment No. 207F:
Page 54, line 14, after first ("land") insert ("and buildings").
The noble Earl said: I shall be extremely brief on this point. The purpose of this amendment and the two which follow is merely to seek clarification that the term "land" in the context of this Bill includes the buildings which may be on that land. I know that this is regarded as automatic in terms of judicial understanding, but I felt it wise to have the point specifically clarified. I beg to move.
The Lord Chancellor: These amendments are not necessary because of the existing general law. Under the Law of Property Act 1925, as applied in the Interpretation Act 1978, the definition of "land" already includes buildings and other structures. In this context, and in this clause, it is therefore unnecessary to require the addition of the words "and buildings". I believe that to be the position. If the noble Earl will be kind enough to check this for himself, perhaps in the meantime he will feel able to withdraw the amendment.
The Earl of Lytton: I am greatly heartened by what the noble and learned Lord said. In the circumstances, while thanking him for that, with the permission of the Committee I withdraw the amendment.
Amendment, by leave, withddrawn.
[Amendments Nos. 207G and 207H not moved.]
The Earl of Lytton The Earl of Lytton moved Amendment No. 207J:
Page 54, line 20, after ("condition") insert ("express or implied").
The noble Earl said: In moving this amendment I speak also to Amendments Nos. 207K, 207KA, 207KB, 207KC and 207L, as they are all interrelated.
Lord Mishcon: Perhaps I may intervene to say that the noble Earl said he was speaking to one of my amendments. It is kind of him, but perhaps he did not intend to say so.
The Earl of Lytton: I beg the noble Lord's pardon. I am not sure to which amendment he refers.
Lord Mishcon: I refer to Amendment No. 207KA.
The Earl of Lytton: Thank you. I am not speaking to that amendment. I am speaking to Amendments Nos. 207J, 207K, 207KB, 207KC and 207L, I ask the Committee's pardon.
The reason behind the amendments is that there is a perceived abuse that has crept in, particularly to some of the larger organisations on our high streets which offer combined services such as estate agency services, mortgages, pensions, insurance and many other services. It is an abuse that is creeping in because certain types of service are being made implicitly, or sometimes explicitly, dependent on a person taking out other services offered by the same concern. In its simplest terms, somebody may make an offer on a house which he has seen for sale in an

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estate agents and be left in no doubt —I put it no more strongly than that —that his offer will not be forwarded to the vendor unless he agrees to organise his financial affairs through the company which is selling the property.
Another abuse which is certainly not in the public interest concerns instances which have come to my notice where people have been talked out of their existing endowment policies in favour of taking out different types of insurance. A member of the public may be relying on the information that he has been given by the person offering the services and it may cause the policyholder to change his policy to his very considerable financial detriment.
All these amendments are intended to reinforce subsection (3). I shall be delighted if the noble and learned Lord could tell me that that subsection caters for all the points about which I am concerned. I apologise to the Committee for lumping together these various amendments, but I believe that it will save time at this late hour. I feel that they are sufficiently related for me to deal with them together.
I shall divide them into the three categories into which they most conveniently fall. Amendments Nos. 207J, 207K and 207KB are intended to cover any sort of pressure or influence that may be brought to bear, whether it is explicit or implied. I think the current wording of the Bill is a little relaxed about that. Sometimes an explicit inference cannot be drawn, but often it is something which is not said or put into writing.
Amendment No. 207L is intended to define the categories of persons who could be brought into the net by the provisions of the Bill. I believe that the term "associate" is not clear or strong enough. As regards Amendment No. 207KB, it specifically prevents an abuse of the failure to pass on an offer of purchase to a vendor. I beg to move.
Lord Morris: In so far as these amendments clarify Clause 72(3) I strongly support them. I particularly support the inclusion of the words "express or implied", the argument for which was eloquently put by the noble Earl, Lord Lytton. I shall be grateful to hear what my noble and learned friend has to say about the efficacy of the inclusion of those words.
Baroness Gardner of Parkes: I oppose these amendments. I hope that my noble and learned friend the Lord Chancellor will not accept them. I intend to speak later on clause stand part and I shall go into greater detail then.
The Lord Chancellor: I believe that the word "condition" includes any condition whether express or implied, written or oral. I refer to Amendments Nos. 207J and 207K.
Amendment No. 207KB is in a somewhat different category. It seeks to insert the words:
"No person shall make the passing on to a vendor of a borrower's offer subject to a condition, express or implied, that any services required by the borrower are to be provided by that person or by an associate of his".
We all understand what the amendment is aiming at and that the wider it is cast the better. The practice
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of an estate agent refusing to pass on a prospective purchaser's offer to a vendor unless the prospective purchaser agrees to take services from the agent is obviously utterly wrong. I have a great deal of sympathy with the sentiments behind the amendment and would point out that where a mortgage is involved, the estate agent's behaviour is likely to be caught by Clause 72. This is because we have deliberately left "services" undefined to make the ambit of the clause as wide as possible. The term could therefore be taken to include the service of passing on an offer.
Where a residential property loan is not involved, however, the abuse addressed by the amendment is properly a matter for the Director General of Fair Trading, not the Bill. Indeed, in the consultation paper on estate agency published last September, the director general suggested that this particular abuse should constitute an undesirable practice. This could lead to the issue of a warning and ultimately a prohibition order under the Estate Agents Act. Although we do not know the ultimate result of the consultation exercise, the director clearly has the matter in hand and I think that we should leave it to him to pursue.
The matter is a fundamental question of agency. I believe it right that the director general should be the authority responsible for ensuring that proper practice prevails. In the light of that explanation, I hope that the noble Earl may feel able to withdraw the amendment.
The Earl of Lytton: I am heartened by what the noble and learned Lord has said. In the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mishcon Lord Mishcon moved Amendment No. 207JA:
Page 54, line 21, leave out ("an associate of his") and insert ("any other person nominated by him.").
The noble Lord said: I should like to speak at the same time to Amendment No. 207KA. At this stage of the Bill we are dealing with the most sensitive issue of residential loans and tying-in provisions. The Committee will recollect that the noble and learned Lord was extremely careful in his Second Reading speech to make it clear that he wished to see that the borrower in these circumstances was properly protected against undue tying-in arrangements.
The purpose of the amendment is to substitute for "associate" the words "any other person nominated by him". It may be difficult to prove that someone is an associate. The reference should be to a person who is nominated by the lender. In those circumstances it would be clear that he should not nominate in regard to a tying-in arrangement. I beg to move.
The Lord Chancellor: I am grateful to the noble Lord for the suggestion in the amendment. If he will allow me I should like to consider it carefully. This is a difficult area in which to operate. The Building Societies Act has a provision like this but I am

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anxious to get the provision right. The noble Lord's suggestion is extremely valuable and may enable us to simplify the clause. I am happy to consider it further. I believe that it may indicate a good way forward.
Lord Mishcon: The noble and learned Lord has been very gracious. In view of what he has said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 207K to 207KC not moved.]
Lord Mishcon Lord Mishcon moved Amendment No. 207KD:
Page 54, line 32, at end insert—
("(5A) No lender, or any associate of a lender, shall require a greater consideration to be payable by the borrower for any service which either of them provide or offer to provide to the borrower than the consideration which the lender, or (as the case may be) associate of the lender, would have required if the borrower had been provided with combined services.
(5B) For the purposes of subsection (5A)—

"services" includes making or offering to make a residential property loan; and

"combined services" means any combination of services whether provided or offered by the lender or any associate of his or partly by the lender and partly by the associate.")

The noble Lord said: Again, I can be brief. The purpose of the amendment is obvious. It prevents a lender or any—I should not use the word "associate"—person nominated by him charging more for a particular service to a borrower who does not require other services—for example, financial services—than would be charged to a borrower who also obtained other services from the lender or an associate. I beg to move.
1.15 a.m.
The Lord Chancellor: The idea of the clause is to provide customer protection against tying in so that the customer can insist that each service involved in a transaction should be priced separately and be available separately. Separate pricing enables the customer to choose which services, if any, he wants, and discourages the person offering the services from offering them at a loss. Separate pricing is achieved by Clause 72(5). The amendment seeks to discourage lenders from offering a package of services to a customer at a discount. At first sight, that does not appear to be in the interests of the customer or client.
It is also essential that the various services offered should be available separately. That is the whole point of the tying-in provision. Clause 72 does not, and so far as I have been able to consider the matter, should not, prevent packages provided—this is an important proviso—that there is no element of coercion or conditionality involved in the customer's decision to take all the services offered rather than some or none.
Packages of services can benefit both the pocket of the lender and the pocket of the borrower. It is not unknown for solicitors to offer a reduced rate if, for example, they are acting for a number of purchasers all of whom are buying leases in the same block of flats. I do not believe that the amendment is in the interests of the customer. I believe that my noble friend Lady Gardner of Parkes is thinking of
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making a point related to this matter on clause stand apart. While I am happy to consider what was proposed in the previous group of amendments, this seems to be counter to the idea of the interests of the customer when one understands the purpose of the clause.
Lord Mishcon: At this hour I should sensibly say that I shall consider carefully what the noble and learned Lord has said, and consider my position at a later stage of the Bill. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 207L not moved.]
Lord Mishcon Lord Mishcon moved Amendment No. 207LA:
Page 54, line 41, at end insert ("and

(f) any body corporate which is a holding company or subsidiary of the lender within the meaning of section 144 of the Companies Act 1989;

(g) any person who has an arrangement with the lender relating to the making of loans or the provision of other services to borrowers; and

(h) any person nominated by him to provide any service.").

The noble Lord said: With the Committee's permission, I propose to speak also to Amendments Nos. 207LB, 207LC, and 207LD, and to do so briefly.
The first amendment would also extend the descriptions of persons connected with the lender who would be treated as associates—again I think the better term is "nominated by the lender" —in connection with tying-in arrangements.
The second amendment would make it clear that the provision of insurance is covered by the clause. The third amendment would place a duty on the Director General of Fair Trading and local trading standards officers to enforce the provisions of the clause, and give them the necessary search and seizure powers. The fourth amendment would ensure that the clause applied to insurance companies. I beg to move.
The Lord Chancellor: The line that the noble Lord has suggested on the earlier amendments might make it unnecessary to pursue Amendment No. 207LA. The amendment which defines services to include
"the provision of or arranging of insurance of any class whatsoever".
is not necessary because we have tried to make the word "services" as general as possible. To focus on a particular type of service might limit the scope of the word "services". It is wise in the clause to have the scope of "services" as wide as possible. One cannot be certain of how people will seek to deal with the clause if it becomes law. It is right therefore not to confine the word "services" in any way.
I do not believe that the Director General of Fair Trading, so far as I understand his attitude, would welcome responsibility for enforcement, but local trading standards officers might be appropriate, if the noble Lord will allow me to consider that matter further.
So far as concerns Amendment No. 207LD, under Section 16 of the Insurance Companies Act 1982

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insurance companies have to be specially treated. That section, implementing two EC directives, prohibits insurance companies from offering services unconnected with their insurance business. One such unconnected service which insurance companies may in the future wish to offer conveyancing. However, because of Section 16 an insurance company could do so only if, at the same time, the customer took on an insurance service, such as a residential property loan from the company. It is because of that difficulty, which is entirely due to a statutory provision passed by Parliament to enable us to honour our Community obligations, that special provision has been made for insurance companies in Clause 72 of the Bill.
It is fair to say, however, that although it is clearly necessary to make specific provision for insurance companies, it may be possible to limit, in the light of what the noble Lord has proposed, exactly how that should be done. I shall undertake to look into this matter further in the light of what the noble Lord has said.
Lord Mishcon: I appear to have scored two "half-goals" out of four attempts, and in those circumstances I feel I ought to say how grateful I am that at least those scores are achieved. If the noble and learned Lord will kindly consider these matters, I think the object of moving the amendments will have largely been achieved.
I am sure he will appreciate by tabling these amendments we are trying to eradicate the abuses which arise from the imposition of tying-in arrangements on borrowers. That is the whole purpose of the amendments. Having regard to what the noble and learned Lord said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 207LB, 207LC and 207LD not moved.]
On Question, Whether Clause 72 shall stand part of the Bill?
Baroness Gardner of Parkes: These are problems with this clause as drafted. I consider that it is based on an incorrect supposition, which is that the mortgage-lending institutions have it within their power to force borrowers to use related services, such as estate agency, conveyancing, surveying, insurance broking, house removals, etc.
That might have been the case five or 10 years ago when there was a permanent shortage of mortgage funds when lenders were able to dictate terms. But over recent years the mortgage market has become highly competitive, and any lender wishing to impose an unreasonable term is not likely to get the business. Power has shifted very dramatically from the lenders to the intermediaries like the insurance and mortgage brokers.
I have been asked to make these points on behalf of the Council of Mortgage Lenders, and I should also declare that I am one of the vice-presidents of the Building Societies Association.
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However, perhaps the major policy objection is that as drafted the clause would, as the noble and learned Lord the Lord Chancellor has suggested, seem to prevent a lender from offering a package deal. Here I entirely agree with the noble Earl, Lord Lytton, that it would be wrong to force people not to have choice. However if this ends up the other way, and people will lose out on the benefit of some cheap deal because there is a package, that would be very wrong. I think that this clause needs to be looked at again in its entirety. In fact subsection (2) looks as if it prohibits the packages.
I appreciate that it is not a simple matter to draft primary legislation and to ensure that such very common practices are permitted. But if the Government wish to proceed with the proposal, it is very important that appropriate consultation should take place to ensure that what emerges is right for the consumer and fair to the mortgage lenders.
An alternative would be for the Lord Chancellor to retain power to make appropriate regulations to encapsulate a code of practice. A code of practice has, as I am sure he knows already, been very effective in Section 35 of the Building Societies Act 1986. This change would replace that clause, as I understand it, and that is a good thing.
It is important to realise the other side of the coin to which the noble Lord, Lord Mishcon, referred. That is that by insisting that someone should not obtain a better deal we do not want someone to have a worse deal through the provision. Provided there is no compulsion whatever on the parties, I believe that it is right that there should be a free market. If people wish to avail themselves of all services from one source, they should be able to do so.
The Lord Chancellor: The clause only requires that it cannot be made a condition of accepting one service that somebody must accept some other service from the nominated person, if I understood the suggestion of the noble Lord, Lord Mishcon. Certainly that will do for a summary. One does not have to do that unless one wishes. A person is free to take one service by itself or two or more, depending on what he wants.
My noble friend asked whether the clause prevented people from offering favourable package deals to the customer. The answer is no, it does not do that. But the amendment which the noble Lord, Lord Mishcon, proposed—Amendment No. 207KD —was intended to effect that. That is the reason I do not feel able to go along with the amendment. My noble friend may be assured that the clause does not have the unfavourable effect that she had in mind: preventing the customer from obtaining a favourable package if more than one service is taken.
My noble friend also suggested that this is perhaps best dealt with by regulations. She will be aware that this problem arises continually as to whether we should do one or the other. I have chosen here to follow the lead given in the Building Societies Act and make this primary legislation. The relevant section was not brought into the Building Societies Act. Instead, a voluntary code was provided for.

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That is always possible but I should like to be sure that this was right so that if I had to bring it in it would be the right provision to regulate the position.
I have taken the view that in this case we should go for primary legislation. I hope that by doing so I have at least found favour in some quarters. Although my noble friend would prefer it to be done differently, I have to try to preserve the balance. I hope that Members of the Committee will allow Clause 72 to stand part of the Bill.
Clause 72 agreed to.
Clause 73 [Liability of magistrates for damages and costs]:
Lord Renton Lord Renton moved Amendment No. 207LDA:
Page 55, line 39, at end insert—
("(3A) For the purposes of sections 44 and 45 the term "justice of the peace" includes Stipendiary Magistrate, Metropolitan Stipendiary Magistrate, acting Stipendiary Magistrate and acting Metropolitan Stipendiary Magistrate.").
The noble Lord said: Clause 73 amends Sections 44 and 45 of the Justices of the Peace Act 1979. It has been brought to my attention that in doing so it has created a certain amount of doubt as to whether the term "justice of the peace" includes all the people mentioned in the amendment: stipendiary magistrate, metropolitan stipendiary magistrate, acting stipendiary magistrate and acting metropolitan stipendiary magistrate. I can give the reasons for these doubts quite fully if necessary. However, if my noble and learned friend will accept the amendment, I should not wish to waste the time of the Committee in doing so. I beg to move.
The Lord Chancellor: There is no difference between us on intention. I intend to include all these people and we believe that we may have done so. But if there is doubt about it, perhaps my noble friend will be kind enough in due course—not at the moment—to tell me the detail of the doubts and, I shall take them up with the draftsman. The intention is quite plain that the various persons he has mentioned, all of whom are justices of the peace in some shape or form, should be included in the protection.
1.30 a.m.
Lord Renton: I can assure my noble and learned friend that there are real doubts. I shall bring them to the attention of his department. In the meanwhile I am grateful for his response and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 73 agreed to.
Clause 74 agreed to.
Clause 75 [Time when action brought for purposes of limitation enactments]:
On Question, Whether Clause 75 shall stand part of the Bill?
Lord Mishcon: It is a tragedy that at this hour, when one is dealing with an attempted and very fundamental alteration in the law, I should have to argue that this clause should not stand part of the Bill. Clause 75 seeks to alter the rule which has stood for a very long time that the limitation period involves the issue of a writ —that is a matter of certainty of date. The clause attempts to alter that by stating that it shall be the service of the writ. This occasions extreme difficulty. I shall try hard not to weary the Committee with too many examples of why this is a bad provision.
I start with the three-year rule which, as regards the statute of limitations, concerns personal accidents. Often a plaintiff will neglect to go to a solicitor in regard to a personal injury, whether it occurred at work or resulted from an accident, until, all of a sudden, some time afterwards a doctor tells the person, having examined him, that he has discovered a rather serious complaint which arises out of the accident. Before the solicitor has time to look into the question of whether there has been negligence and whether therefore there is a course of action which is likely to succeed, he has to look at the limitation period. Often what he does is to issue a writ in order to be sure that it comes within the statutory period and therefore he will not be statute barred, and he puts it, as the saying goes, in the drawer. Then he looks into the facts and the evidence that might be available. It is not an easy job if some period of time had elapsed since the accident occurred. The solicitor, having considered the evidence, then advises that he believes the client has a good course of action and that he will go ahead with it. Alternatively, he may say that sufficient evidence to take an action is not available and he may discourage the client from continuing with any action.
Once a writ is served an action has already started; it is in being. A statement of claim must follow pretty soon. If the statement of claim is not served pretty soon an agile defendant, if I can use that adjective, will immediately apply to have the action struck out by virtue of the fact that the statement of claim has not been served. Therefore there was good reason for the writ issue date, quite apart from the question of certainty which I have already mentioned, being the operative date, and that the service of the writ was not. That is the alteration in the law which Clause 75 suggests. What it really does is to cut down the limitation period; that is the effective purpose of it. That is not the only reason why this is a bad clause.
The Committee will have noticed that the clause is a wide one. It begins with the words:
"For the purposes of the Limitation Act 1980, and of any other enactment relating to the limitation of actions (whenever passed)".
That can only mean that it will bring in the very short limits that exist at the moment; namely, the one-year time limit on the international carriage of goods by road and sea, and the two-year time limits on collisions at sea and in air carriage cases. That must be highly unsatisfactory.
As I said, it is a pity that an alteration as vital as this should be discussed in Committee with such a

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small attendance. I express my admiration for fellow Members of your Lordships' Committee who have stayed here until five and twenty to two in the morning, and I hope that I may take a little scrap of admiration myself for having done so as well.
I hope that at least the noble and learned Lord will say that, bearing in mind the importance of the matter and the views that have been strongly expressed by the Law Society and, I believe, by the Bar Council, and many other organisations which are vitally interested, he will give more consideration to the views that are now being put forward before saying that he intends to abide by Clause 75 of the Bill. It is in such temperate language that I oppose the Motion, That Clause 75 shall stand part of the Bill.
The Lord Chancellor: Clause 75 implements the recommendation of the Civil Justice Review that for the purposes of the Limitation Act 1980 an action should be brought at the time when process is served. That is one of a number of proposals designed to reduce pre-trial delay—particularly in personal injury cases—with which the review was principally concerned. A related procedural change, which will come into effect by rules of court on 1st June this year, will reduce from 12 to four months the maximum permitted interval between issue and service of process.
As the noble Lord has said, the present position under the Limitation Act 1980 is that originating process must be issued within a specified period. That is not a matter that needs to come to the attention of the defendant. For personal injury cases the limitation period, as specified in Section 11(4) of the Act, is three years from the date of the incident or knowledge of the cause of action. Detailed rules apply. A further 12 months is allowed to elapse, with the result that the maximum period between the date of the incident and the process being served on the defendant is four years. The rule change would reduce that to three years four months. The effect of Clause 75 would be to reduce the period to a maximum of three years, as proposed by the Civil Justice Review.
One of the purposes of the law of limitation is to give potential defendants complete assurance that after a stated period has elapsed, the action will not proceed unless there are exceptions to the application of the stated period. Our present system does not achieve that. If originating process in a personal injury case is served at the end of the three-year limitation period, the defendant may have a further year of uncertainty as to whether or not the action is to proceed. The matters that require to be established in relation to service are matters that are capable of proof. I am not sure that real difficulty arises because the present rule of court requires that service has to take place within the year of issue. The date of service is still important.
One of the problems to which the noble Lord referred relates to short limitation periods under a variety of statutes, most of which have a foreign element having been set up under international
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conventions to which the United Kingdom is a signatory. The provision may well be simplified in consequence of that point because the Limitation Act 1980 is principally in issue. That is what the recommendation of the Civil Justice Review has in mind and what I am considering at the moment and shall consider even further in the light of the matters that the noble Lord has brought to my attention; namely, to restrict the clause to the Limitation Act 1980 and leave the other enactments out of account altogether.
I am considering that matter and shall consider further what the noble Lord has said, but the recommendation of the Civil Justice Review was made after considering practical difficulties, so a good deal of the matter has already been given thought. In the light of that explanation perhaps the noble Lord will feel able to withdraw his amendment.
Lord Hacking: Before the noble and learned Lord sits down, will he be kind enough to consider the international implications? Practices in London often have to serve proceedings overseas. In some countries overseas service can be effected only through the diplomatic service. I recently had a case which has serious complications concerning the law of limitation and required a consideration of service in a number of countries in South America. We were advised that in some of those countries it would take as long as 10 months to serve the process.
The Lord Chancellor: I shall certainly consider the matter.
Lord Mishcon: It is obvious that the noble and learned Lord is prepared to consider the matter especially in regard to international implications and the examples that I gave of periods that are included by virtue of international conventions.
Perhaps I may briefly add another practice difficulty which I hope the noble and learned Lord will consider when looking at Clause 75. Some defendants ingeniously manage to evade service. There is a procedure, well known to the noble and learned Lord, by which one applies to the court for substituted service. It will be an extraordinary situation when one goes before a master of the High Court and says to him, "Please, for heaven's sake will you make your order for substituted service tomorrow because otherwise I shall not be able to comply with your order for substituted service, as you allowed the application that, in view of the obvious evasive tactics of the defendant, an order for substituted service should be made?". All those practical difficulties must be considered. The noble and learned Lord has been gracious enough to say that he will consider those matters.
Clause 75 agreed to.
Clause 76 [Costs against legal representatives in magistrates' courts]:
The Chairman of Committees: If Amendment No. 207LE is agreed to, I cannot call Amendment No. 207M.
Lord Mishcon Lord Mishcon moved Amendment No. 207LE:
Page 57, leave out lines 7 to 26 and insert—
(" .—(1) Without prejudice to the generality of the power to make rules under section 144 above, any such rules may make provision empowering a magistrates' court, where —

(a) there has been a serious dereliction of duty to the court on the part of any legal representative or employee of such representative; and

(b) as a result a party of the proceedings has incurred costs, to disallow, or (as the case may be) to order the legal representative concerned to meet, the whole of those costs or such part of them as may be determined in accordance with the rules.").

The noble Lord said: I hope that the noble and learned Lord will take it from me that I have no more time than any other Member of the Committee for advocates who behave in an unseemly manner, whether in magistrates' courts or anywhere else. However, I believe that some considerations should be taken into account.
As noble Lords will see, the amendment makes it clear that, for magistrates' courts, the test to order legal representatives to pay costs will be a test of serious dereliction of duty to the court on the part of the legal representative. If it were not for the amendment, it would be a most peculiar fact that magistrates would have a greater power to penalise a solicitor in costs than has the High Court. The test in the High Court and in the Crown Court is that the solicitor has been guilty of a serious dereliction of duty. Those are exactly the words that my amendment proposes to put in this Bill.
I am sure that it will be in the recollection of the noble and learned Lord, the Master of the Rolls, and it would perhaps assist the noble and learned Lord to recall that as recently as 10th November last year the Court of Appeal gave judgment in five appeals which came before it concerning costs orders made against solicitors in Crown Court cases. The Court of Appeal considered the nature and degree of fault on the part of a solicitor sufficient to justify the exercise of the court's inherent jurisdiction to award costs. The court clearly stated as follows:
"The locus classicus is Myers v. Elman"—
that was a 1940 case in Appeal Court Cases 282 —
"We would define the conduct which gives rise to this jurisdiction as any conduct of a solicitor which involves a serious dereliction on the part of the solicitor of his duty to the court".
The court also stated that it took into account the dictum of the noble and learned Lord, Lord Denning (who was then, I believe, Master of the Rolls) in the case of Thew v. Reeves Ltd., (1982, 1QB) that jurisdiction is not available in cases of mistake, error of judgment or mere negligence, but is only available when the conduct of a solicitor is inexcusable and such as to merit reproof.
With this amendment I simply try to put the magistrates' court on a level with the High Court with regard to the language that is used. I hope that the noble and learned Lord will consider this a proper amendment. I beg to move.
1.45 a.m.
Lord Donaldson of Lymington: In dealing with this matter, I hope that the noble and learned Lord will also take into account the fact that many of these
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cases are rather better dealt with by the professional disciplinary bodies concerned. Certainly in the Civil Division of the Court of Appeal, unless there is a glaring case, if there is any investigation to be done we prefer to refer it to the Bar Council or the solicitors' complaints bureau, as the case may be, which are much better able to investigate what really went on.
The Lord Chancellor: I agree with my noble and learned friend in so far as the matter is intended to deal with disciplinary powers, as it were, over legal representatives. That is the power which preserves the inherent jurisdiction of the Supreme Court over solicitors, as provided in Section 50 of the Solicitors Act 1974. But the idea behind this clause is to provide in the magistrates' court a power parallel to that in the High Court under Rule 11 of Order 62 of the Rules of the Supreme Court, deriving from Section 51 of the Supreme Court Act and, by extension, the county courts, which itself is to be re-enacted in the form of Clause 4 of this Bill. So there is a distinction between those two types of power, and I believe that that is a proper distinction.
Where the primary purpose is compensatory—that is, that the court should have power to shift the loss from where it has fallen to the person whose fault has occasioned it —the appropriate test is of the kind contained in the clause as drafted and in Order 62, Rule 11, rather than the other, more restricted kind appropriate where the primary purpose is to enforce the duties of officers of the court.
I believe that that is very often a disciplinary matter and that my noble and learned friend advises wisely that the court generally should leave it to the disciplinary authorities which can investigate it in a way that may not be easy for the court to do —not very quickly anyway. The other matter concerns the nature of compensation in respect of loss which the court appreciates has occurred. The idea is to shift the loss from where it has fallen to the person whose fault has occasioned it.
In the light of that explanation, I hope that the noble Lord will feel that the clause as drafted is appropriate.
Lord Mishcon: If I may say so, that still does not deal with the point about language; namely, that of severe dereliction of duty as against the words used in regard to the High Court. The noble and learned Lord did not appear to me to deal with that specific matter. If I misheard him due to the lateness of the hour or did not take in what he said when I should have done, I apologise to him.
The Lord Chancellor: I endeavoured to suggest that this wording came from Order 62, Rule 11, and that that wording is reflected in this clause. The wording to which the noble Lord referred relates to the exercise of the court's powers as preserved by Secton 50 of the Solicitors Act.
Lord Donaldson of Lymington: If I may say so, the noble and learned Lord the Lord Chancellor is

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correct. Serious dereliction of duty does not occur in Order 62.
Lord Mishcon: Having received that reproof from two such learned sources, I must ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 207M not moved.]
Clause 76 agreed to.
Lord Mishcon Lord Mishcon moved Amendment No. 207MA:
After Clause 76, insert the following new Clause:
("Costs against solicitors.
The following subsection shall be inserted in the Solicitors Act 1974 after subsection (3) of section 50 —
"(4) Where an appeal by a solicitor under subsection (3) is successful in whole or in part the Court of Appeal may make an order in favour of the solicitor for payment to be made out of central funds in respect of his costs of the original hearing and the appeal, such costs to be taxed in the Supreme Court." ").
The noble Lord said: I hope to be able to take the amendment briefly. Section 50(3) of the Solicitors Act provides that an appeal shall lie to the Court of Appeal from any order made against a solicitor by the High Court or the Crown Court in the exercise of its jurisdiction in respect of solicitors. The proposed amendment would provide that where a solicitor is successful on such an appeal, the Court of Appeal may make an order of payment to be made out of central funds in respect of a solicitor's costs.
It seems to be to be just and proper that that should be so provided for. I beg to move.
The Lord Chancellor: The effect of this clause would be to have the payment made out of central funds, if I have understood the objective correctly.
Lord Mishcon: Yes.
The Lord Chancellor: That is a considerable novelty. I find it hard to see why central funds should be involved in matters that arise between parties. There is a different question in relation to such disciplinary provisions as Section 50 of the Solicitors Act 1974. As a result of a request from one of my judicial colleagues, I am presently considering what can be done about that because it is in the nature of a disciplinary provision.
However, this is different. I do not believe that it would be right to make such a provision in relation to decisions which are an allocation of costs between parties before the court.
Lord Mishcon: Will the noble and learned Lord permit me to elaborate very quickly on what he has just said, and on my original submission? We are dealing with a case where an officer of the court, a solicitor, has been penalised. He goes to the Court of Appeal, having obviously incurred the costs of a hearing in the court below. The Court of Appeal sets aside the order that was made against him as being unjustified either in whole or in part.
It may be that I am wrong in suggesting that the costs should come out of the common purse. But is
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the noble and learned Lord saying it is just that a solicitor in those circumstances, who has proved that the penalising order should not have been made and has the endorsement of the Court of Appeal that that is so, should have no remedy in regard to recovery of his costs? It is quite obvious that in such a serious case no man is his own best representative. He obviously would be represented by another professional man. It appears quite wrong, if I may say so, that the noble and learned Lord is suggesting that he shall have no remedy in regard to costs even though he has been successful in the Court of Appeal.
Will the noble and learned Lord at least be prepared to say that he will consider the justice of this matter, and whether the costs should come out of another fund, if he feels that I have taken them out of the wrong fund?
The Lord Chancellor: There may be a question of costs against the other party but at present I see no justification for the public purse incurring the cost of what has occurred.
Lord Donaldson of Lymington: I have a slight difficulty in that the copy of Adamson's Solicitors Act 1974 does not include subsection (3). However, the point of principle which I understand is being raised by the noble Lord, Lord Mishcon, is that where one is exercising the inherent jurisdiction of the High Court in relation to a solicitor, the court may well be acting on its own motion. It may not be penalising the solicitor at the request of the other party.
The question arises in two stages. The first stage, with which perhaps all will agree, is that if on appeal it is held that the solicitor should never have been penalised in the first place and that he has incurred costs in establishing that position, he ought to be reimbursed those costs in plain fairness. However, if the other side had no part in putting the solicitor in the position of peril in which he stood at the end of the proceedings of first instance, it is a little hard that that party should be expected to foot the bill.
I can well imagine some situations in which, if I had been a trial judge and taken a particular view of a solicitor's conduct but had been wrong, wild horses would not have stopped me from penalising him. I believe that the situation needs investigating.
The Lord Chancellor: Fairly fundamental questions are involved. At one level, it is the consequence of a judicial act that has produced the costs. Normally, public funds do not bear such costs; otherwise there would be a large demand on public funds. Therefore, substantial difficulties stand in the way of making awards in this area out of public funds. For that reason I wanted to be sure that that was precisely what the noble Lord had in mind. I understand from him that it was. In those circumstances, I have great difficulty in giving effect to the amendment.
Lord Mishcon: It will not surprise the noble and learned Lord or any Member of the Committee if I state boldly that I have no intention of dividing the Committee on this amendment and at this hour.

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However, being serious, the noble and learned Lord the Master of the Rolls put the matter so much better than I did. If it is not a question of public funds it may be that there is another way of compensating the solicitor who has been found to have been wronged. If he dislikes the idea of public funds being mulcted in this way, I ask only whether the noble and learned Lord will consider whether there is another source from which the costs could come.
The noble and learned Lord has said that where somebody has suffered as a result of court procedures going wrong and where somebody has suffered an injustice by way of loss, in certain circumstances there could be a claim, be it to the ombudsman or to someone of a similar nature. One cannot have a damnum sine injuria in these circumstances; that is a loss without a remedy.
Will the noble and learned Lord at least consider the situation, which is unjust, and see whether there is an alternative source from which the costs can be made to somebody who has been wronged in that way?
2 a.m.
Lord Donaldson of Lymington: Before the noble and learned Lord the Lord Chancellor responds, perhaps I may make what I hope is a helpful suggestion both to the noble Lord, Lord Mischon, and to the noble and learned Lord the Lord Chancellor; namely, that we cannot possibly go down the road suggested, that we are compensating for a judicial error. If we once go down that road, the consequences need no spelling out.
However, the point could be put in this way, and perhaps the Lord Chancellor could consider it on that footing. Where a disciplinary power is being exercised in this way, on occasion at the instigation of the court, the true analogy is a criminal proceeding. It is the state taking action against one of its officers. Of course, in the criminal field, costs out of public funds are common where the accused is acquitted. That analogy might fit the bill. In my submission, the other line of argument should be rejected very swiftly.
The Lord Chancellor: When I first spoke on this I indicated that, at the invitation of one of my judicial colleagues, I was considering the question of Section 50 costs. I have not yet completed that. Therefore, if it can be called a benefit, the noble Lord will have the benefit of the same consideration.
Lord Mishcon: I am most grateful. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 77 [Bail applications]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 207MB:
Page 58, line 9, leave out ("a Crown Prosecutor") and insert ("the Director").
The noble and learned Lord said: This amendment is designed to clarify who will give instructions in
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relation to bail applications. It is intended that it should be the director personally and this amendment makes that plain. I beg to move.
Lord Hutchinson of Lullington: I presume that the noble and learned Lord brought forward this amendment as a result of our debate on Amendment No. 139A on this very question. The noble and learned Lord will remember that the matter was discussed at some length on the basis of whether it was right that the Director of Public Prosecutions should be permitted to employ unqualified staff to conduct bail application proceedings before Supreme Court judges.
The view was expressed in all parts of the Chamber that, having regard to the crucial importance of the matter both in relation to the liberty of the subject and to the safety of the public, that was quite unacceptable. Having heard what was said, the noble and learned Lord agreed to reconsider the situation in relation to Clause 77 which is now under discussion.
I hope that I am right in my presumption that this amendment was brought forward as a result of that debate. If that is so, then I cannot for myself see how this makes any improvement at all on the situation. The position is that the person dealing with the bail application is an unqualified person designated by the Director of Public Prosecutions. I am at a loss to understand the difference between being designated by the Crown prosecutor, and the Director of Public Prosecutions. Presumably, it does not mean that in every single bail application all over the country when an unqualified person is sent to deal with it he receives his instructions from the director personally. It cannot mean that. Presumably, it means that he will receive his instructions from a Crown prosecutor acting on behalf of the director.
I ask the noble and learned Lord: what is the difference between those two situations? Does it mean that ultimately it is exactly as was realised when we had our previous debate: that the person who deals with the application is an unqualified person dealing with a matter of supreme importance in regard to the liberty of the subject and the safety of the public?
The Lord Chancellor: That point of principle remains and presumably that is what we will discuss on Clause 77 stand part. The purpose of this amendment is to ensure that the director himself can give instructions to the people who will handle the bail applications if this clause is allowed to stand part of the Bill. Therefore, he can give instructions to which they must conform. The result of that is not to make it any less objectionable from the point of view of the noble Lord. We shall argue about that on clause stand part.
On Question, amendment agreed to.
On Question, Whether Clause 77, as amended, shall stand part of the Bill?
Lord Hutchinson of Lullington: Having taken part in these proceedings for over 10 hours, I do not now

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intend to press my opposition to the clause standing part of the Bill. The result of going on so late is that it merely piles up matters for a later stage.
However, I am bound to remind the Committee that this subject was debated at some length and, as I have already said, the general feeling of those who took part in the debate under Amendment No. 139A was that it was quite unacceptable for unqualified persons to deal with bail applications which are held in private and which are of the greatest possible importance to the liberty of the subject and to the safety of the public. The noble and learned Lord said that as a result of that debate he would reconsider the matter. I should be most grateful to hear whether he has in fact done so.
Lord Renton: On the question of whether Clause 77 should stand part of the Bill, I support the noble Lord, Lord Hutchinson of Lullington. I simply ask: is it not a matter of having high enough standards of professional advocacy to enable justice to be done and to appear to be done? It is essential for the prosecution to be represented by a qualified lawyer, barrister or solicitor; somebody who understands the law and the implication of the Bail Act and who is prepared and brought up to serve the court in accordance with the rule of law. There is a danger, if we have someone not so qualified, of his thinking that his only duty is to oppose bail by all possible means. We do not want that to happen because that is not justice.
Lord Hacking: Perhaps I may also support the noble Lord, Lord Hutchinson, on this point. Indeed, I have some side notes on my copy of the Bill which read, "Law Society and Bar Council united; House to be divided".
The Lord Chancellor: I should not like it to be thought that simply because the Bar Council and the Law Society had taken a particular view that that necessarily was a view that ought to prevail.
I should like to say a few words about this, though the noble Lord has indicated how he views the position. In the case of Re Director of Public Prosecutions ex parte The Association of First Division Civil Servants (1988), the Divisional Court held that only the DPP himself and Crown prosecutors (that is, qualified lawyers) have power under the Prosecution of Offences Act 1985 to conduct proceedings. The point at issue in the case was whether the DPP could delegate to staff who are not legally qualified the function of screening cases to decide whether prosecutions can proceed. The court held that such delegation was ultra vires as screening constituted "conduct of proceedings" which can only be carried out by the DPP or by the Crown prosecutor.
It is not intended to reverse this decision by allowing unqualified staff to screen cases. The decision did, however, cast doubt on the legality of another practice involving CPS officials who did not possess legal qualifications; namely, the making of representations for the prosecution in respect of bail applications before a judge in Chambers in the High
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Court and in the Crown Court. In Section 15(3) of the 1985 Act, "conduct of proceedings" is defined as including the making of representations in respect of applications for bail.
The purpose of this clause is to allow the Director of Public Prosecutions to designate any member of the Crown Prosecution Service, though not a barrister or a solicitor, to appear before a judge in Chambers in the High Court or a Crown Court for the purpose of making representations on behalf of the CPS in respect of any application for bail or to vary the conditions of bail or impose conditions in respect of bail which has been granted unconditionally.
As I said, the person appointed to have this function would be somebody selected for the purpose by the Director of Public Prosecutions. My understanding is that the situation which prevailed, until the decision in the case to which I have referred, was that experienced non-lawyers in the Crown Prosecution Service dealt with bail applications and that they had done so to the satisfaction of the court.
The view was taken, and that is why this clause is proposed, that the practice should continue. My understanding is that this decision was welcomed by the members of the judiciary at the time. Since then the CPS has received representations from a number of judges about how well that work was handled by law clerks. In the areas in which they did appear I understand that the judiciary never called into question their independence or competence.
Since the CPS stopped this practice in the light of doubt about legality flowing from the decision, a number of judges have made it known that they regret the change. I believe it right that the cases should be dealt with at the appropriate level. Provided that the person handling this kind of application is competent and adequately trained, and provided that the appropriate controls are there, it is clear that an unqualified person can provide the service that the courts require. That is what we are trying to achieve here.
That does not mean that that procedure will be followed in every case. It means that in a case where the Crown Prosecution Service judge it appropriate, this possibility should arise. It seems a reasonable situation which prevailed in the past without any damage or difficulty as far as I can judge.
I have just been referred to what I said as regards the earlier amendment. I do not think that I gave any particular undertaking about this matter. It is an issue of considerable importance. The noble Lord has indicated the course of action that he proposes to take. I shall have an opportunity to consider further what he has said tonight in preparation for what he may say if he raises the matter again. I have looked into the matter more fully since he raised the question and the information which I have is one of the results of that.
Lord Hutchinson of Lullington: I am grateful to the noble and learned Lord for what he has said.
Clause 77, as amended, agreed to.
Clause 78 [Law reports]:
[Amendments Nos. 207N to 207Q not moved.]
Clause 78 agreed to.
Clause 79 agreed to.
Schedule 10 agreed to.
Clause 80 agreed to.
Clause 81 [Interpretation]:
[Amendments Nos. 208 and 209 not moved.]
2.15 a.m.
The Lord Chancellor The Lord Chancellor moved Amendment No.209A:
Page 60, leave out lines 33 and 34.
The noble and learned Lord said: I spoke to this amendment with Amendments Nos. 137B and 141A. It is designed to split the definition of "recognised body", to which I referred before. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No.209B:
Page 61, line 7, at end insert —
("(3) In this Act any reference (including those in sections 24(7) and 25(4)) to rules of conduct includes a reference to rules of practice.").
The noble and learned Lord said: This is one of the amendments that I proposed in relation to the earlier amendments. It makes it clear that rules of conduct includes a reference to rules of practice. I beg to move.
On Question, amendment agreed to.
On Question, Whether Clause 81, as amended, shall stand part of the Bill?
Lord Hacking: The noble and learned Lord said after interventions by the noble and learned Lord the Master of the Rolls and I that he would have another look at the definition of "court" which is to be found at the bottom of page 59.
The Lord Chancellor: I did indeed.
Clause 81, as amended, agreed to.
Clause 82 [Regulations and orders]:
[Amendment No. 209BA had been withdrawn from the Marshalled List.]
Lord Simon of Glaisdale Lord Simon of Glaisdale moved Amendment No. 209BB:
Page 61, line 12, after ("1(1)") insert ("1(4), 9(5)").
The noble and learned Lord said: With the leave of the Committee, I shall speak to Amendments Nos. 209CA and 209CB. These amendments are a matter of considerable parliamentary and constitutional moment; and as noble Lords will see, they have support from all parts of the Committee.
I rise to move Amendment No. 209BB at 2.15 a.m. That was always predictable and was predicted. We are now in the sixth day of Committee stage. On
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only one of those days has the Committee adjourned before 10.30 p.m. On another day besides this we went on past midnight. It was always predictable that, if noble Lords sat at reasonable hours to do the job that had to be done on this Bill, seven or eight days would be needed for the Committee stage.
The amendments all relate to the changing of procedure in the clauses and subsections to which they refer from the negative procedure to the affirmative procedure. All but two of the subsections relate to Henry VIII clauses. When I moved a similar amendment at the Report stage of the Children Bill my noble and learned friend accepted it with alacrity. If he is prepared to indicate that he accepts this group of amendments, I shall sit down at once.
The Lord Chancellor: Before the noble and learned Lord sits down, I should say that I am willing to consider for affirmative resolution procedure the subject matters that he has raised. Clause 1(4) is the one which we discussed in relation to Clause 1. I indicated then that I would endeavour to make it clear what I was seeking to say. I know that my noble and learned friend does not agree with me. He said that although I said it thrice, I had not persuaded him. I am sorry that I said it thrice if I did not have that effect. I intend to deal with that point. I am minded to delete Clause 9(5) in the light of the considerations brought forward by my noble and learned friend. Clause 23(1) and (2) are in much the same position as Clause 1(1) and (4). So far as the rule-making powers for conditional fees and the rights of Scottish and Northern Ireland lawyers are concerned, I am content that the basic rule should be under the affirmative resolution procedure. The only matter about which I am a little concerned —perhaps my noble and learned friend will allow me to consider it —is whether all the regulations under Clause 45 require to be dealt in that way.
I am prepared to deal with Clause 44 by affirmative resolution. I am more doubtful about Clause 45 because it is an EC method. I do not have a strong view about it, but that is my present feeling. I hope that that is sufficient indication to enable my noble and learned friend to decide what he is going to do. I am inclined to do my best to accommodate the views put forward earlier by my noble and learned friend on that aspect of the matter.
Lord Simon of Glaisdale: I am very much obliged to my noble and learned friend. I am not sure that I have taken in everything that he said. So far as Clause 1(1) and (4) are concerned, it is not only that I do not agree with my noble and learned friend —that would be neither here nor there —but no other Member of the Committee agrees with him. However, I understand that he is going to amend that provision and it may be better to wait to see how that turns out.
Clause 45(4) is a Henry VIII clause. Perhaps my noble and learned friend will allow me to discuss the details with him. In the meantime, if the noble Lords, Lord Rippon and Lord Mishcon agree, I shall beg leave to withdraw the amendment.
Lord Rippon of Hexham: My Lords, I wonder whether my noble and learned friend the Lord Chancellor might consider agreeing (so that we do not have to have this discussion too often) that in any case where the Henry VIII clause is employed —that is to say, where there is a power to amend or repeal the primary legislation —there will always be the affirmative resolution procedure. If we received that undertaking it would save a great deal of time because that point has come up time and again in recent legislation.
The Lord Chancellor: I am appreciative of the length of time for which my noble friends and my noble and learned friends have waited to put their point. I am disposed to do everything that I possibly can to meet what they have said. In the circumstances, agreeing with my noble friend Lord Rippon is perhaps the least that I can do. I understand the concerns and, while I am not sure that I entirely accept his description of the amendments, where the power to amend primary legislation is conferred, even in a limited sense, I shall see that the affirmative resolution procedure is followed.
Amendment, by leave, withdrawn.
[Amendments Nos. 209C to 209E not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 209F:
Page 61, line 18, after ("Act") insert ("other than one under section 86(2)").
The noble and learned Lord said: This amendment is designed to make it clear that we do not need the negative resolution procedure in relation to commencement orders. As currently drafted all statutory instruments under the Bill are subject to the affirmative or the negative procedure, which should not be necessary for simple commencement orders and is not the general practice. I beg to move.
On Question, amendment agreed to.
Clause 82, as amended, agreed to.
Lord Mishcon Lord Mishcon moved Amendment 209G:
After Clause 82, insert the following new clause:
("Saving for legal aid.
.—(1) Nothing in this Act concerning rights of audience for lay persons or for solicitors shall prejudice any application for or grant of representation under the Legal Aid Act 1988.
(2) When the Legal Aid Board is performing its functions under section 15(3) of the Legal Aid Act 1988 and it appears to the Board that all or some solicitors have rights of audience before the court in which the proceedings are taking place or are likely to take place, that circumstance shall not be taken into account by the Board when deciding whether to grant representation and whether to permit the instruction of counsel.
(3) When a competent court under sections 20, 27 or 29 of the Legal Aid Act 1988 is performing its functions under sections 21, 22, 28 or 29, and it appears to the court that all or some solicitors have rights of audience before the court in which the proceedings are taking place or are likely to take place, that circumstance shall not be taken into account by the court when deciding whether to grant representation and whether to assign counsel.").
The noble Lord said: I ought to point out to the Committee that we have achieved a defeat for the Leader of the House, who I believe has heard what I have said, and the Chief Whip, who I believe has
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heard what I have said. The defeat is on the following basis. They were insistent that we were only allowed six days for this Committee stage. I have to inform them that we have now gone almost through the seventh day. In those circumstances, I regard that as a victory.
Amendment No. 209G does just this. It seeks to ensure that the extension of rights of audience to lay persons under Clause 8 of the Bill, and to solicitors under Part II, is not used as a reason to restrict eligibility for legal aid or to deny representation by counsel in appropriate cases. I do not have to make a long speech on this amendment, because the noble and learned Lord conceded the point very generously and very frankly when I moved an amendment for incorporation in the Bill of a clause which saw to it that these extensions of right generally were not meant to be an invasion of rights under legal aid.
The client must have the right to say to the legal aid authorities, "I should like to have counsel in this case", and the legal aid authorities should not be in a position to say, "We are very sorry, but there was a solicitor who conducted the general preparation of the case, and we think that as that solicitor has a right of audience he should be the person who conducts the case and not counsel". The Law Society is very keen to see that this position is maintained as under this amendment, and so is the Bar Council.
I believe that the noble and learned Lord will want to carry out what he has always said, which is that the whole purpose of many provisions of this Bill is to preserve the client's choice. This is what this amendment does and I hope that the noble and learned Lord will be able to agree to it. I beg to move.
Lord Renton: Perhaps I may very briefly say that I support this amendment. It is only right that somebody on the government side should make that clear.
The Lord Chancellor: I entirely go along with the point of view that the mere fact that we are seeking to increase choice, which is what this Bill is about, is not to be taken as a cost-cutting exercise so far as concerns legal aid. I am also anxious to preserve the point that the level of representation appropriate to a particular case is something that the Legal Aid Board has statutory responsibility for already; and of course the judges also have in criminal matters a power in this situation to say at what level representation should be.
For example, the legal aid authorities can say whether counsel should be instructed in a particular case where legal aid is available, and a solicitor or counsel might be appropriate depending on the nature of the case. The legal aid authorities have discretion of that kind and, again, the legal aid authorities —legal aid authorities includes for this purpose the courts in appropriate cases —have power to say whether the case justifies the employment of leading counsel rather than just a junior counsel. I should want to continue to provide that kind of flexibility. I do not think there is much between us; it is a question of how it should be phrased. I am sure that the noble Lord would not suggest that in a

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trivial case the client on legal aid should have the right to employ a very expensive counsel.
The general idea that increasing choice will be frustrated by not giving the client an appropriate level of choice is not a provision that I wish to see under the Bill. I believe that this is also the aim of the noble Lord.
Lord Mishcon: Indeed it is. I hope that that is clear from the wording of the amendment. I hope that the noble and learned Lord will agree that I have been rather careful in the wording that I have employed. Of course any discretion which the Legal Aid Board had before the passing of the Bill must remain. I have specifically provided in subsection (1) that,
"Nothing in this Act concerning rights of audience for lay persons or for solicitors shall prejudice any application for or grant of representation under the Legal Aid Act 1988".
Therefore the amendment merely states that none of the changes in the Act can be used as a reason for depriving a client or applicant for legal aid of what would have been his rights had the Act not been passed. That is what the amendment says and I should have thought the noble and learned Lord agrees with it. If he tells me that the wording can be tightened up and it is a matter of drafting but the principle is right, of course I shall ask leave to withdraw the amendment. Alternatively, in his generosity, since this is almost the final amendment, he could say to the Committee that he accepts the amendment but reserves the right to "clean it up", if I may use that expression, in drafting when we come to a later stage. That would be a very generous gesture.
The Lord Chancellor: I should like to read carefully what the noble Lord has said. I believe there is not very much between us and that we should be able to reach a form of words which accurately reflects what we wish. In any case, I should like to try to deal with the question of the other authorised litigators and advocates under the new framework in relation to legal aid. Perhaps the noble Lord will be kind enough to allow me time to consider that matter and I shall see whether we can achieve a form of words to which we can both agree.
Lord Mishcon: I shall use the expression which has been used before. This appears, as the noble and learned Lord has said, to merit his favourable consideration with a view to a clause which carries out the principle. On that clear understanding I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 83 to 87 agreed to.
schedule 11[consequential Amendments]
The Lord Chancellor The Lord Chancellor moved Amendment No. 209GA:
Page 10, line 11, leave out from ("section") to ("money"), in line 12, and insert ("and section 33 references to clients' money and money of a kind mentioned in subsection (1)(b) of this section or (1)(a) of section 33 include references to").
The noble and learned Lord said: This is a technical amendment. The Government proposed in the White Paper to make provision to allow solicitors, who held money as stakeholders, to pass to their clients any interest earned on that money. In addition, they proposed that all money held as a stakeholder must be put on deposit, and interest paid to the client, unless the amount is de minimis. This proposal required amendments to Sections 32 and 33 of the Solicitors Act; these deal with the council's power to make accounts and trust account rules, and rules as to the payment of interest on clients' money. As there was some doubt that the amendment as drafted in paragraph 5 extended to Section 33 of the Act, I move this amendment to the Bill to make that intention clear. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 209H:
Page 109, line 40, after ("inserted") insert (" "or").
The noble and learned Lord said: In moving this amendment I wish to speak also to Amendments Nos. 209JA and 209L. Paragraphs 9 to 17 of Schedule 11 set out consequential amendments to the Judicial Pensions Act 1981 arising mainly from Clause 55 of the Bill, which extends the dependant's benefits scheme to female judges and their widowers. They insert references to female judges and their dependants where appropriate in the Act. Amendment No. 209H picks up one reference which was missed when the Bill was drafted. The others are purely drafting amendments which make no changes of substance. I beg to move.
On Question, amendment agreed to.
[Amendment No. 209J had been withdrawn from the Marshalled List.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 209JA:
Page 110, line 3, leave out from ("words") to the end of line 4 and insert (" "widow or child of his" there shall be substituted "widow, widower or child of that person"; and").
On Question, amendment agreed to.
[Amendment No. 209K had been withdrawn from the Marshalled List.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 209L:
Page 110, line 6, leave out ("person" ") and insert ("person's" ").
On Question, amendment agreed to.
Schedule 11, as amended, agreed to.
Schedule 12 [Transitionals and savings]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 209M:
Page 112, line 4, leave out ("or other instrument") and insert ("instrument or other document").
The noble and learned Lord said: Amendment No. 209M broadens slightly the scope of paragraph 1 of Schedule 12. This paragraph construes references

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to registrars as references to district judges, and presently applies only to references found in enactments or other instruments. This amendment applies the construing provision to references in "documents" as well.
The purpose of this amendment is to include references in practice forms. These are documents prepared by the court service for the encouragement of uniformity and consistency in communications with the public. They do not, however, have any legislative force and are thus not covered by the term "instrument" or "enactment". I beg to move.
On Question, amendment agreed to.
[Amendment No. 210 not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 210A:
Page 113, line 12, at end insert —
("(3) The definition of "replacement date", inserted in section 87(1) of the Solicitors Act 1974 by paragraph 7 of Schedule 11 shall have effect subject to the provision made by this paragraph.").
The noble and learned Lord said: The purpose of this amendment is to clarify the workings of the transitional provisions for the new system of solicitors' practising certificates set out in Clause 61 of the Bill. At present all practising certificates expire on 31st October each year. Under the new system the noble and learned Lord the Master of the Rolls is to be empowered, with the concurrence of the Lord Chancellor and the Lord Chief Justice, to make regulations prescribing a replacement date by which a solicitor must apply for a new practising certificate.
On the coming into force of Clause 61, the transitional provisions provide that all practising certificates then in force shall automatically have replacement dates of the following 31st October. This ensures that there is a smooth transition into the new system, and that the transitional arrangements will take precedence. I beg to move.
On Question, amendment agreed to.
Schedule 12, as amended, agreed to.
Schedule 13 [Repeals]:
Lord Hutchinson of Lullington Lord Hutchinson of Lullington moved Amendment No. 211:
Page 114, line 52, column 3, at end insert—

("Section 83.").

The noble Lord said: I have the doubtful honour of going in last in very poor light. I hope the noble and learned Lord will obey the convention that fast bowlers do not bowl at tail enders. In moving this amendment, I wish also to speak to Amendment No. 212. This is a repealing schedule and it would seem that two important repeals have not been included in the schedule.
Clause 24(1) states:
"The question whether a person has a right of audience before a court, or in relation to any proceedings, shall be determined solely in accordance with the provisions of this Part".
Under Section 83(1) of the Supreme Court Act 1981 the noble and learned Lord the Lord Chancellor may direct that,
"solicitors may appear in, conduct, defend and address the court in any proceedings in the Crown Court".
In Section 83(2) a direction,
"may have effect as respects all places where the Crown Court sits",
or as specified earlier.
In Section 83(3) the Lord Chancellor,
"shall have regard to any shortage of counsel in the area in question … and to any other circumstances affecting the public interest".
When I raised this matter earlier in the proceedings the noble and learned Lord said that in his view that power referred only to curious places such as Bodmin where there was a shortage of barristers and where solicitors might be appointed under this clause. However, the noble and learned Lord's predecessor made directions under that section regarding solicitors having rights of audience in appeals and committals for sentence in all Crown Courts. Therefore it would not seem to have been operated only in regard to curious places such as Bodmin.
In those circumstances it appears that the Lord Chancellor may bestow rights of audience in all Crown Courts by direction in any circumstances which he considers affect the public interest. I wonder how that can sit with the terms of Clause 24.
Equally, under Section 4(3) of the Prosecution of Offences Act 1985, for the purpose of giving Crown prosecutors additional rights of audience in the Crown Court, the Lord Chancellor may give any such direction as he could give under Section 83 in respect of solicitors. Therefore, under that statute, the Lord Chancellor appears to have power to grant similar rights of audience in Crown Courts to solicitors in the employ of the Crown Prosecution Service.
Those two powers seem to ride through the provisions of Part II of this Bill. Therefore, I suggest that both should appear in the repeal schedule to the Bill. I beg to move.
The Lord Chancellor: The fundamental section is Section 83 of the Supreme Court Act 1981. The provision in the Prosecution of Offences Act uses that section.
The view that I have taken of the provision, since I have had to operate it, is that it is intended for special situations. So far as I can recall, the only use that I have made of it is the one that I mentioned. I am not sure that I used the phrase "curious places like Bodmin". If I did, I had best be careful. I referred to Bodmin as somewhere from where I had to move an existing practice direction and transfer it to Truro when the Crown Court moved from Bodmin to Truro.
I have taken the view that the section deals with special situations rather than general situations. I agree that it refers to,
"all places where the Crown Court sits".

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However, when one looks at the considerations to which the Lord Chancellor is supposed to have regard I believe that the intention is that it be special.
There is also the point that practice directions have been made under that section. If there is saving for them they would fall on any repeal. I am sure that the noble Lord will be aware that any suggestion that we should take away existing rights of audience in Caernarvon would not be wise. The principle embodied in the Bill is that existing rights of audience are not to be taken away. There is a practice direction which refers to Caernarvon, Barnstaple, Bodmin, Doncaster and Lincoln as well as one referring to Truro.
The second, more general, direction was made some time ago in respect of criminal proceedings in the Crown Court. It provided that in some cases the same firm which appeared for the defendant in the magistrates' court could appear in civil proceedings on appeal from the magistrates' court on the basis of the special circumstances that it had appeared in the proceedings in the magistrates' courts. I understand that the provisions of the second practice direction are widely used. I wish to maintain those provisions.
I have taken the view of Section 83 is not a general provision that would enable me to override the general law in that area. I should not wish to lose the existing practice directions. For that reason, I should not like to repeal Section 83 in the repeals schedule. The noble Lord is perfectly right to say that from the enactment of the new system rights of audience will be determined solely in respect of that method. Accordingly, I hope that he will feel able to withdraw his amendment and the section relating to prosecution offences which stands in it.
2.45 a.m.
Lord Hutchinson of Lullington: Does the noble and learned Lord agree that the power has been used not only in the way that he undertakes to use it, but broadly to give those rights in all Crown Courts? That is what makes one nervous of leaving those powers unrepealed.
The Lord Chancellor: I see that. I agree that the provisions of the second practice direction about appeals to the Crown Court from magistrates' courts in civil proceedings and in criminal proceedings in the Crown Court in some cases where the same firm appeared in the magistrates' courts are fairly general. They are based on the circumstances that the solicitor appeared in the magistrates' court. In that way they are somewhat special.
However, my view of the section has been the more narrow one. It may be wise for me to consider in what form the section might continue in view of what the noble Lord has said, but I think that the general words that we have used in Clause 24, to the
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effect that rights of audience should be determined only in respect of that, would make it clear that from now on Section 83 applies only to special circumstances. If the noble Lord is prepared to leave the matter with me, I shall certainly consider it. I do not want to lose the existing rights created under Section 83 because those are important rights which it would not be correct to try to remove.
Lord Hutchinson of Lullington: Having regard to the medium pace at which the noble and learned Lord has bowled, I am perfectly happy to withdraw the amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Lord Chancellor The Lord Chancellor moved Amendment No. 211ZA:
Page 114, column 3, leave out lines 53 and 54.
The noble and learned Lord said: This is a drafting amendment to delete from Schedule 13 the provision for the repeal of paragraph 3(2) of Schedule 6 of the Supreme Court Act 1981. That provision has in fact already been repealed by the Statute Law (Repeal) Act 1989. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 211ZB:
Page 115, column 3, leave out lines 9 and 10.
The noble and learned Lord said: This is a consequential drafting amendment to an earlier amendment removing the subsection in Clause 3 which would have repealed Sections 50 and 51 of the County Courts Act 1984. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 211A:
Page 115, line 15, column 3, at end insert —

("Section 89(3).").

The noble and learned Lord said: This amendment repeals Section 89(3) of the County Courts Act 1984 and is entirely consequential upon Clause 12 which updates the list of articles which are exempt from seizure under warrants of execution in the county courts. It substitutes for the concept of a prescribed value below which articles are protected the test of whether or not those articles are necessary. I beg to move.
On Question, amendment agreed to.
[Amendments Nos. 212 and 212A not moved.]
Schedule 13, as amended, agreed to.
House resumed; Bill reported with amendments.
House adjourned at ten minutes before three o'clock.