House of Commons Hansard Debates for 16 Oct 1990

Sir Nicholas Fairbairn : On the hon. and learned Gentleman's point about the False Oaths (Scotland) Act, although a section states that that may not be used in evidence in criminal proceedings, there is no way in which the Act comes into this unless it can be put to the person who is on oath, when subsequently charged with a criminal offence, that he or she previously said something different from the nominee.

Mr. Menzies Campbell : The hon. and learned Gentleman is quite correct. To establish a conviction under the False Oaths (Scotland) Act 1933, it will be necessary to prove that what was said to the nominated officer was false, and that can be done only by leading evidence in relation to what was said to have been incriminating. This is a can of worms. Although it is commonplace in Committee or on Report for hon. Members to complain that the provisions are insufficiently detailed or insufficiently well thought out, in this case such criticisms are more than germane. They go right to the heart of what the Minister is endeavouring to persuade the House to accept. I hope that he will realise that hon. Members of all parties have advanced points of great substance, not mere debating points. If, in the light of what has been said, he is not satisfied with what he is trying to persuade the House to accept, he should take the honourable course and withdraw the amendment.

6.15 pm

Lord James Douglas-Hamilton : Several interesting points have been raised. I begin with the question asked by the hon. Member for Glasgow, Garscadden (Mr. Dewar) about whether the person who is being interviewed would be caught by clause 5(7) if he or she refused to answer the

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question. The person would be so caught, because subsection (6) requires the person to answer such questions as may be asked under subsection (4). An offence would therefore have been committed. The hon. and learned Member for Fife, North-East (Mr. Campbell) asked whether a sheriff would be present at the interview. The hon. Member for Falkirk, East (Mr. Ewing) asked about corroboration. The sheriff will not be involved in the interview. The offence will be required to be proved beyond reasonable doubt in the same way as any other offence and will be subject to the requirement of corroboration.

Mr. Dewar rose --

Lord James Douglas-Hamilton : I shall give way to the hon. Gentleman in a moment.

The hon. Member for Falkirk, East also asked whether a person is entitled to be legally represented at the interview. The Bill does not create a right for a person to be legally represented, but I assure the hon. Gentleman that no objection will be made if a person wishes to be legally represented at the interview.

The hon. Member for Garscadden--

Mr. Menzies Campbell : I am grateful to the Minister for giving way, and I do not wish to thrash this point unnecessarily. Suppose the nominated officer said, "I am not prepared to allow you to have the solicitor of your choice present at this examination." The person who has been summoned has no right to the presence of a solicitor or any other person. If the nominated officer takes that decision, the person who has been summoned will have to abide by it. How can that be just?

Lord James Douglas-Hamilton : I am giving an undertaking that that will not happen. Such a person would be allowed to have a solicitor with him.

Mr. Dewar : Could the Minister say a little more about the effect of the criminal penalty in clause 5(7)? Obviously, an offence would have to be established by corroborated evidence. One therefore assumes that there will be people in the room other than the interviewee and theinterviewer--

Mr. Menzies Campbell : Such as a shorthand writer?

Mr. Dewar : Is there, for example--I am being helpfully prompted from the left--likely to be someone such as a shorthand writer present? If there are only two people in the room, corroboration will prove a remarkable difficulty. Perhaps the Minister could say something about that.

Lord James Douglas-Hamilton : I sincerely hope that in most of the cases that we believe would involve a possible breach of trust, or something of that nature, there will be no question of criminal proceedings. However, if somebody refuses to answer or to provide accounts where they undoubtedly exist, the provisions will prove necessary to ensure that those who have given money to a charity or those who will benefit from it are not disadvantaged or prejudiced in the process.

Mr. Dewar : Absolutely. However, I am referring to what the Minister helpfully said about clause 5(7)--that, if a person refuses to answer a question, he or she will be open to a fine not exceeding level 5 on the standard scale.

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That is clearly a criminal prosecution. I am simply trying to establish who the Minister expects to be in the room to provide the corroboration.

While the Minister is at it, perhaps he could say more about his guarantee that a solicitor can represent the person being interviewed. It will be an odd situation, because presumably a solicitor is present to give his client advice about his right and might well be tempted to say, "I don't think that you should give that information, because you will incriminate yourself." What would be the solicitor's position if he gave that advice and if the client purported to take it?

Lord James Douglas-Hamilton : The hon. Gentleman has answered his own question--he said that a shorthand writer or someone of that nature would probably be with the nominated person. If an offence were committed, it would be subject to the normal rules relating to proof and corroboration when it came before a court.

Sir Nicholas Fairbairn rose --

Lord James Douglas-Hamilton : I want to answer the question about false oaths, and my hon. and learned Friend can come back on this in a minute if he likes. It is clear that no answer to a question under subsection (6) can be used in any subsequent criminal proceedings. This will operate in the same way as Department of Trade and Industry inspectors, who have not run into tremendous difficulties in this connection. There are precedents for DTI inspectors making investigations. If, when making an investigation, an inspector, instead of finding evidence of breach of trust, runs into a case of serious fraud, he stops immediately and reports it to the Lord Advocate.

I mentioned that no answer to a question under subsection 6 could be used in any subsequent criminal proceedings against the person, except under section 2 of the False Oaths (Scotland) Act 1933, which relates to the making of false statements without oath. Section 2 states :

"If any person knowingly and wilfully makes (otherwise than on oath) a statement false in a material particular, and the statement is made--

(a) in a statutory declaration ; or

(b) in an abstract, account, balancing sheet, book, certificate, declaration, entry, estimate, inventory, notice, report, return or other document, which he is authorised or required to make, attest, or verify by, under, or in pursuance of any public general Act of Parliament for the time being in force ; or

(c) in any oral declaration or oral answer which he is authorised or required to make by, under, or in pursuance of any public general Act of Parliament for the time being in force,

he shall be guilty of a crime."

I think that that is quite straightforward, and there is no question of that provision being repealed.

Amendment agreed to.

Amendments made : No. 4, in page 7, line 4, after attend' insert and'.

No. 5, in page 7, line 12, at end add--

( ) A person shall not be excused from answering such questions as he may be required to answer by virtue of subsection (6) above on the ground that the answer may incriminate or tend to incriminate him, but a statement made by him in answer to any such question shall not be admissible in evidence in any subsequent criminal proceedings against him, except in a prosecution for an offence under section 2 of the False Oaths (Scotland) Act 1933.'.-- [Lord James

Douglas-Hamilton.]

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Clause 6

Powers of Court of Session to deal with management of charities

Amendment made : No. 6 in page 10, line 11, leave out from the' where it second occurs to ; and' in line 12 and insert

charitable purposes of that body, or the charitable purposes which are purported to be the purposes of that body'.-- [Lord James Douglas- Hamilton.]

Clause 9

Small charities

Lord James Douglas-Hamilton : I beg to move amendment No. 7, in page 13, line 43, leave out intentions' and insert spirit'.

Mr. Deputy Speaker : With this it will be convenient to take Government amendment No. 8.

Lord James Douglas-Hamilton : These are purely drafting amendments. I am grateful to my hon. and learned Friend the Member for Perth and Kinross (Sir N. Fairbairn), who drew our attention to drafting inconsistencies in Committee.

Amendment agreed to.

Amendment made : No. 8, in page 14, line 16, leave out intention' and insert spirit'-- [Lord James Douglas-Hamilton.]

Clause 11

Appointment of trustees

Amendments made : No. 9, in page 16, line 10, leave out both the Lord Advocate and'.

No. 10, in page 16, line 13, at end insert--

(2) Where in the case of any trust which is a recognised body-- (a) the number of trustees is less than three ; and

(b) it appears to the Lord Advocate that the trustees will not, or are unable to, exercise their power under subsection (1) above, if it appears to the Lord Advocate expedient to do so, he may exercise the power in place of the trustees.'-- [Lord James Douglas-Hamilton.]

Clause 13

Interpretation of Part I, regulations and orders

Lord James Douglas-Hamilton : I beg to move amendment No. 11, in page 16, line 35, leave out an unincorporated body'.

Mr. Deputy Speaker : With this it will be convenient to take Government amendment No. 12.

Lord James Douglas-Hamilton : Clause 31 provides a definition for "body" that is intended to make it clear that "body" refers to unincorporated bodies such as trusts or associations. They are purely drafting amendments.

Amendment agreed to.

Amendments made : No. 12, in page 16, line 38, after court' insert

in relation to an unincorporated body'.-- [Lord James Douglas- Hamilton.]

No. 13, in page 16, line 46, leave out

has the meaning given by'

and insert

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shall be construed in accordance with'.-- [Lord James Douglas-Hamilton.]

New Clause 15

Board's intervention powers

.--(1) The powers conferred on the Board by this section may be exercised if, after such inquiry (if any) as the Board consider appropriate, it appears to them to be desirable to do so for the purpose of protecting the interests of the clients, or prospective clients, of an independent qualified conveyancer or an executry practitioner (each of whom is in this section referred to as a "relevant practitioner").

(2) The Board may, in particular, exercise any such power where it appears to them that a relevant practitioner--

(a) is no longer a fit and proper person to provide conveyancing services or, as the case may be, executry services ;

(b) has ceased, for whatever reason, to provide such services ; or (c) has failed, or is likely to fail, to comply with regulations made under section 15(10A) or, as the case may be, section 16(10) of this Act.

(3) The Board may direct the relevant practitioner not to dispose of, or otherwise deal with, except in accordance with the terms of the direction--

(a) any assets belonging to any client of the practitioner and held by or under the control of the practitioner in connection with his business as an independent qualified conveyancer or, as the case may be, an executry practitioner ; or

(b) any assets of the practitioner which are specified, or of a kind specified, in the direction.

(4) The Board may direct the relevant practitioner to transfer to the Board, or to such persons (in this section referred to as "the trustees") as may be specified in the direction--

(a) all assets belonging to any client of the practitioner and held by or under the control of the practitioner in connection with his business as an independent qualified conveyancer or, as the case may be, an executry practitioner ; or

(b) any assets of the practitioner which are specified, or of a kind specified, in the direction.

(5) A relevant practitioner to whom a direction is given may, within 21 days of the date on which the direction is received by him, apply to the Court of Session, which may make such order in the matter as it thinks fit.

(6) A relevant practitioner to whom a direction is given shall comply with it as soon as it takes effect (and whether or not he proposes to apply to the Court of Session under subsection (5) above).

(7) If, on an application to the Court of Session by the Board, the court is satisfied--

(a) that a relevant practitioner has failed, within a reasonable time, to comply with any direction given to him ; or

(b) that there is a reasonable likelihood that a relevant practitioner will so fail,

the court may make an order requiring the practitioner, and any other person whom the court considers it appropriate to subject to its order, to take such steps as the court may direct with a view to securing compliance with the direction.

(8) Any assets which have been transferred as a result of a direction given under subsection (4) above shall be held by the Board, or by the trustees, on trust for the client or, as the case may be, the practitioner concerned.

(9) The trustees may deal with any assets which have been transferred to them only in accordance with directions given to them by the Board.

(10) If the Board have reasonable cause to believe that a relevant practitioner or an employee of a relevant practitioner has been guilty of dishonesty resulting in pecuniary loss to a

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client of the relevant practitioner, they may apply to the Court of Session for an order that no payment be made by any bank, building society or other body named in the order out of any bank, building society or other account or any sum deposited in the name of the relevant practitioner without the leave of the court and the court may make such an order.

(11) Any direction under this section--

(a) shall be given in writing ;

(b) shall state the reason why it is being given ;

(c) shall take effect on such date as may be specified in the direction (which may be the date on which it is served on the relevant practitioner) ; and

(d) may be varied or revoked by a further direction given by the Board.

(12) In this section--

"assets" includes any sum of money (in whatever form and whether or not in any bank, building society or other account) and any book, account, deed or other document held by the relevant practitioner on his own behalf in connection with his business as a relevant practitioner or on behalf of the client concerned ; and

"independent qualified conveyancer" and "executry practitioner" respectively include any independent qualified conveyancer or executry practitioner whether or not he was registered as such at the time when the matter in relation to which the Board exercise or propose to exercise their powers under this section arose and notwithstanding that subsequent to that time he has ceased to be so registered.'-- [Lord James Douglas- Hamilton.]

Brought up, and read the First time.

Lord James Douglas-Hamilton : I beg to move, That the clause be read a Second time.

Mr. Deputy Speaker : With this it will be convenient to take Government amendments Nos. 38, 51, 53 and 63 to 66.

Lord James Douglas-Hamilton : The new clause was not heralded during our discussions in Committee, so it may be helpful to the House if I briefly outline its purpose and effect.

The provision is intended to enhance the regulatory structure under which the board is to operate. It corresponds closely to an amendment brought forward during the Report stage of the Courts and Legal Services Bill. The new clause gives the board the power to intervene in the business of an independent, qualified conveyancer or an executory practitioner where it appears to the board that the interests of the practitioners' clients are likely to be put at serious risk. I do not envisage that that power will be used often, but it could prove valuable if a practitioner were to deviate from acceptable business practice to such an extent as to threaten the interests of clients or prospective clients.

Under the new clause, the board's powers are backed up by an enforcement mechanism that allows it to go to the Court of Session for an order to secure compliance. I do not believe that the new clause is controversial. It represents the final component of the regulatory regime that we have established for independent qualified conveyancers and executory practitioners.

Mr. Dewar : I am quite prepared to accept that the new clause is non -controversial, and I am delighted to hear that it is the final component. However, I fear that it may not be the last time that I hear about independent qualified conveyancers. I understand that the new clause deals largely with the winding up of businesses of independent qualified conveyancers--not a particularly cheery subject for those who have faith in the new breed of operator. I am

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advised that it gives the conveyancing board powers similar, in terms of dealing with their assets, to those allowed to the Law Society of Scotland, in terms of sections 45 and 46 of the Solicitors (Scotland) Act 1980. I certainly do not have strong feelings on that matter, and I am prepared to see it go through.

Mr. Harry Ewing : Does the Minister envisage that the procedure would be activated on a complaint from the client, or is there some other way that I have not understood?

Lord James Douglas-Hamilton : It would normally be activated on a complaint from the client, unless some untoward facts were discovered. I sincerely hope that nothing of that nature will ever occur.

Question put and agreed to.

Clause read a Second time and added to the Bill.

New clause 22

Multi-national practices

. Before section 61 of the 1980 Act there shall be inserted the following section--

"Multi-national practices

60A.--(1) Subject to the provisions of this section, solicitors and incorporated practices may enter into multi-national practices with registered foreign lawyers.

(2) The Council shall maintain a register of foreign lawyers, and may make rules with regard to registration ; and, without prejudice to the generality of the foregoing, such rules may include provision as to--

(a) the manner in which applications for registration are to be made ;

(b) the fees payable in respect of such applications ;

(d) the period for which any such registration is to run. (3) Section 34(2) and (3) apply to rules made under subsection (2) as they apply to rules made under that section.

(4) Any foreign lawyer may apply to the Council to be registered as such for the purposes of this section and the Council shall, if they are satisfied that the legal profession of which the applicant is a member is so regulated as to make it appropriate for him to be allowed to enter into a multi-national practice with solicitors or incorporated practices, enter his name on the register.

(5) Subject to subsection (6), the Secretary of State may by order made by statutory instrument provide that any enactment or instrument--

(a) passed or made before the commencement of this section ; (b) having effect in relation to solicitors ; and

shall have effect with respect to registered foreign lawyers as it has effect with respect to solicitors.

(6) Before making any order under subsection (5), the Secretary of State shall consult the Council.

(7) An order under subsection (5) may provide for an enactment or instrument to have effect with respect to registered foreign lawyers subject to such additions, omissions or other modifications as the Secretary of State specifies in the order.

(8) No order shall be made under subsection (5) unless a draft of the order has been approved by both Houses of Parliament.".'-- [Lord James Douglas -Hamilton.]

Brought up, and read the first time.

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