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Mr. Fabricant: My right hon. Friend raises the spectre of a worrying situation, but I wonder whether he has overlooked the use of the word "officers" in subsection (2). Surely that would rule out the secretary in a typing pool. The reference in subsection (2)(c) to a secretary means an officer of a body corporate, who would be the company secretary under the terms of the Companies Acts.
Mr. Maclean: I beg to disagree with my hon. Friend. The Bill says:
- For the purposes for this section the following are officers of a body corporate.
I understand some of the reasons behind the legislation. The Government have concluded that some of those involved in this trade are not just big limited companies but partnerships and other funny little businesses, one-man bands, or outfits in which one person is the boss and a few other staff are working for him or her. Some of those other staff might be secretary types or manager types, but they are equally involved in criminality or illegal activity. The Government intend subsection (2) to catch all who are taking part in, or encouraging, such activity. However, if that is the case, the Government should use different terminology.
It would have been acceptable if, in clause 3(1), the Government had used the terminology "with the consent or connivance of any other staff, managers or workers."
What is unacceptable to me is the mucking around with the usual interpretation of company law, suggesting that the officers of a body corporate can include those who are rather loosely described as managers, secretaries or other similar officers. What officer is similar to a director, manager or secretary? In the Companies Acts, one knows what "another similar officer" is in relation to a director or a company secretary. The rather vague terminology used in the Bill does not help us on the matter.As I do not want to take too much time on this group of amendments, I shall move on to my first amendment, No. 3, which is more of a probing amendment than anything else. I can accept the first three lines of clause 3, although, in paragraph (a)--as my right hon. Friend the Member for Bromley and Chislehurst suggests--it might be appropriate to add the word "knowledge" to "consent or connivance". I perfectly well accept that, when an offence is committed as a deliberate act, with connivance or consent, the officers involved--as well as the body corporate, the limited company--should face the penalty.
I do not understand, however, how the offence can be attributable to neglect by an officer. I do not know in what other spheres of the criminal law someone could find themselves in a criminal court because of neglect to comply with an aspect of company law, although I know that, under company law provisions, someone who fails to file accounts or value added tax returns faces the penalty. In this case, however, we are talking about a criminal offence, and potentially an attaching criminal record, because someone in a company--the secretary, the manager or a director--was neglectful in some way in allowing the offence to be committed.
I can envisage circumstances in which someone's trading licence for a hamburger stall has come through for Green park, but not yet for St. James's park, and some manager or secretary says to their people with wheelbarrows or carts, "Off you go--you're off to St. James's park; it's all right, you have a licence there", but gets it wrong. I would say that that was not deliberate connivance--it might be a lack of knowledge--but a simple mistake. Yet, because of the neglect of that secretary in mistakenly directing a staff member to the wrong park, for which she thought that the company had a licence from the Department of the Environment, Transport and the Regions, she might suffer the full penalty of a criminal conviction and a fine of up to £1,000. She would face that penalty because the body corporate and she as a secretary have negligently committed that offence.
The Minister may rightly say that the court would take that into account, and that the police may not charge them but take a sensible view. I am always happy to ascribe to police, including park police, a view that they will always operate with common sense. The only exception to that--this is merely an aside, Mr. Deputy Speaker, or you would promptly rule me out of order--is when one sees pictures of park police on roller-skates, which is their latest device for catching Mafia in the park. I have a such a picture--from the Evening Standard of 13 April--which I may pass to you, Mr. Deputy Speaker, for inspection. Therefore, one sometimes has to question the wisdom of park police--although I am told that the roller-skates are very effective.
Mr. Forth: What if the Mafia put on skates?
Mr. Maclean: They will no doubt evade the police.
Nevertheless, although we shall give police all credence for having common sense on whether they prosecute a poor secretary because she makes a little mistake in sending the guy to the wrong park and commits an offence, it is our duty as legislators not to give police the opportunity to get it wrong initially. We should not build into the legislation a provision that will lead to police catching the wrong people--those who are not the real ringleaders, company directors or masterminds who may be making £1,200 a day. I may be tempted, in the summer recess, to ask the Minister how one can apply for a licence to sell goods in the park, as it sounds a rather lucrative profession.
6.45 pm
My final amendment, No. 31, deals with "purporting to act", which I think should be substituted by "acting". As my right hon. Friend the Member for Bromley and Chislehurst said, it would not be right to prosecute a company because someone falsely claims to be acting in any of the capacities listed earlier in the clause.
It is perfectly right to catch those who are not company directors, managers, secretaries or--if the Government wish--other similar officers, but who are acting in that capacity, actually doing it. Someone in the business may be called "the doorkeeper", "the doorman" or "the garage hand", although those titles are only a cover for his having a very powerful say in the company and the fact that he is the mastermind. In such cases, that person is acting in one of the listed capacities--he is the boss, although he may not have that title.
Someone who is acting in a listed capacity should be caught. What concerns me, however, is that there may be people who falsely claim to be acting in the capacity of boss. I cannot understand the wisdom of simply adding the word "purporting" when I think that the Government really want to catch people who are genuinely doing the acting and perhaps passing themselves off as someone else.
It is a small group of amendments, and we have not dealt with them at great length; there is much more that we could say. There are, however, a few serious points in them. I summarise those points by saying that I am still intrigued by the terminology that the Government have decided to use in the legislation, particularly in clause 3(2). I should like reassurances on the matter from the Minister, who was exceptionally kind and courteous in replying to the first group, thereby persuading my right hon. Friend the Member for Bromley and Chislehurst and I not to press them to a vote. We were persuaded by the strength of the Minister's arguments, which shows the importance of having exploratory amendments and a good ministerial reply.
I hope that the Minister will be able to convince us on this occasion also, so that we shall be able to make some progress--especially as there are some considerable things that I should like to say in speaking to the third group of amendments. There may be issues in that group that we wish to press further. Now, however, I should be happy to hear the Minister's reply.
Mr. Alan Howarth: I appreciate the spirit in which the amendments in this group have been dealt with by the right hon. Members for Bromley and Chislehurst (Mr. Forth) and for Penrith and The Border (Mr. Maclean). I think that, principally, once again, they are seeking clarification and reassurance that the terms in which the Bill is drafted are appropriate.
In amendment No. 18, the right hon. Member for Bromley and Chislehurst has actually sought to strengthen the Bill's provisions. I put it to him that his amendment would be excessively draconian--to use a term that we used in our first debate--in its effect, because it would make liable to prosecution an individual who had any knowledge of a certain state of affairs, regardless of the extent to which that individual could be held personally responsible. It could render officers of a company liable to conviction in cases in which it is unreasonable that they should be punished at all.
The type of cases that amendment No. 18 would add are ones in which a person had attempted, unsuccessfully, to prevent a misdeed--although they knew about it, they were ineffective in being able to deal with it--and various other cases in which someone who had some knowledge was powerless to be effective. I think that that would be unreasonable. I believe--as I hope to persuade Opposition Members--that, as drafted, clause 3(1) covers all the levels of action or inaction by an officer that are appropriate to prosecute.
The right hon. Member for Penrith and The Border has just spoken to amendment No. 3, which he explained was intended as a probing amendment. We need to make provision to deal with negligence. The amendment would restrict the circumstances in which an officer of a company may be convicted of a park trading offence to those in which he has consented to or connived at the commission of the offence by a body corporate. Clause 3(1) provides that if a body corporate has been convicted of a park trading offence and an officer is proved to have consented to or connived at it, or the offence is proved to be attributable to the neglect of the officer, that officer will be liable to prosecution. That additional provision is important.
The amendment would weaken the Bill by excluding from prosecution an officer or body corporate who was negligent. The negligence might be in failing to realise that the body corporate was committing an offence, albeit that the officer concerned was in a position of responsibility within that body corporate. The officer could equally not be prosecuted if he knew that the offence was being committed but did nothing to prevent it. I see no good reason why those who have been negligent should get away with it.
On amendment No. 2, the right hon. Gentlemen were concerned that the language that we have used may not be consistent with the ordinary terminology of company law. The amendment would create a loophole, allowing officers who do not hold the formal title of director or company secretary, but who carry out such responsibilities, to escape liability. It would preclude the possibility of prosecuting a manager or anyone purporting to act in such a capacity for the commission of a parks trading offence. Furthermore, it would remove the important flexibility that is currently written into clause 3(2) that provides for the possibility of prosecuting those who do not precisely fit the categories of director,
manager or secretary, but who hold similar positions that have effectively the same functions even if they are not formally so styled.Amendment No. 20 would not add anything to the Bill, although I assume that it was intended to clarify matters. I am advised that the word "secretary" would be interpreted by the courts to mean company secretary in this context. The amendment would create a loophole by defining the term "company secretary" only by reference to the articles of incorporation, with the result that someone who was effectively company secretary but was not formally styled as such would fall outside the scope of the Bill and would escape criminal liability.
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