Standing Committee B
Tuesday 14 December 1999
[Mr. John Maxton in the Chair]
Power to modify legislation
The Minister for Small Business and E-Commerce (Ms Patricia Hewitt): I beg to move amendment No. 29, in page 7, line 4, after `is' insert `required'.
The Chairman: With this it will be convenient to take Government amendments Nos. 30 to 34.
Ms Hewitt: The amendments deal with subsection (2). Clause 8—the second half of the heart of the Bill—enables us to update the statute book. Subsection (2) contains a list of the type of barriers to doing things electronically that the clause can modify. The purpose of the six Government amendments, which are extremely straightforward, is simply to clarify the range of existing requirements to which the clause applies. We all agree on the need for clear drafting, and although the amendments add a few words to the clause, they also add to its clarity. My right hon. Friend the Lord Chancellor is exploring, with the assistance of the Law Commission and the Land Registry, what is necessary to allow conveyancing in particular to be done electronically, in the context of a comprehensive reorganisation of the land registration system. I am sure that that change will be widely welcomed; we must be sure to get it right before acting. The amendments are the first result of ongoing work to ensure that the power proposed in the clause can be used to, among other things, facilitate electronic conveyancing. It might be helpful if I explained why we have concluded that we need the amendments.
The Law of Property Act 1925, with which I am sure all hon. Members are intimately familiar, says in section 53(1)(b) that a declaration of trust of land
``must be manifested and proved by some writing''
which is one of those 40,000 references to writing, paper and so on that we find in statute law. That is important because any transfer of registered land to two or more people will contain a declaration of the trust on which the land is held. I tabled amendment No. 30 to make it absolutely clear that the powers conferred by the clause can apply to that and to similar requirements for things to be evidenced in writing. In a similar vein, I also tabled amendments Nos. 29, 31, 32 and 34, which broaden the phrase ``is to be'' by substituting ``is required to be''. That clarifies the provision that the clause can operate on something that, although it does not have to be done, must be done in a particular way if it is done. Under the Law of Property Act 1925, a valid trust of land can be declared orally but is unenforceable unless it is evidenced in writing. The addition of the word ``required'', taken with amendment No.30, makes it clear that the clause can apply to such cases. Amendments Nos. 31, 32 and 34 make a similar clarification regarding statutory requirements for post or other specified means of delivery or for authorisation by a person's signature or seal and the making of a payment.
Secondly, there are requirements for things to be delivered as deeds, for example in section 1 of the Law of Property (Miscellaneous Provisions) Act 1989—again, I am sure that members of the Committee are intimately familiar with that legislation. In those cases, when the person delivers the deed, he is acknowledging that he intends to be bound by it. In such cases, the kind of delivery is different from that referred to in subsection (2) (b), which deals with sending and posting. That is why I tabled amendment No. 33. I used the example of conveyancing to illustrate why the amendments were necessary. Our lawyers recognised the need for them when they examined conveyancing, but they will apply more broadly.
Mr. Alan Duncan (Rutland and Melton): We have no objection to the amendments, which tidy up the language and make it more precise. We tend to look on a series of Government amendments with suspicion in case they change the nature of the Bill, but in this case, they do not. In the spirit of Christmas, I give the amendments our blessing.
Mr. Richard Allan (Sheffield, Hallam): We, too, welcome the amendments, as far as they go. Amendment No. 30 raises the issue of what is done ``or evidenced'' in writing. What exactly is meant by ``in writing'' in this context, and to what extent does the Minister intend to broaden the provision? That concern was raised with me by the Law Society, which was worried about how the term ``in writing'' would be used to decide whether a particular circumstance fell within the provisions of the subsection. How will it be applied to a particular sector of Government business?
The Law Society pointed out that the Copyright Designs and Patent Act 1988 makes it clear that writing includes
``any form of notation or code, whether by hand or otherwise and regardless of the method by which, or medium in or on which, it is recorded''.
That provides a broader definition. Does the Minister's new phrasing in amendment No. 30 represent a broadening out of the way in which we can apply a definition to catch more areas of Government business so that electronic signatures can be substituted more comprehensively? As I said, there was initially concern about the relatively narrow area of business that was covered. We need a comprehensive substitution of electronic signatures for any form of notation that was previously used as an ``in writing'' form of signature.
Mr. Andrew Miller (Ellesmere Port and Neston): May I ask whether clause 8 will require a series of statutory instruments? My hon. Friend said that statutory instruments will be necessary to aid property transactions with respect to the Lord Chancellor's Department, but what of other sectors? Will my hon. Friend's amendments facilitate the process or will there still need to be a statutory instrument, as mentioned at the beginning of the clause? I am not entirely clear about that. If the answer is yes, at what pace is the change likely to happen? Some external observers are keen to see the Bill driven forward as quickly as possible because of the benefits that it will bring to Great Britain plc, and they believe that any such statutory instruments should be on the statute book at the earliest opportunity.
Ms Hewitt: On the point that the hon. Member for Sheffield, Hallam (Mr. Allan) made, the Bill will apply to provisions in existing legislation in which the phrase ``in writing'' appears, enabling us to substitute the electronic equivalent. Subsection (2) has deliberately been widely drafted to cover not only statutory requirements for something to be done or evidence to be given in writing, but requirements that something be delivered by post, authorised by signature or under seal, for example. It covers a range of hard-copy requirements for which we now need electronic equivalents. The phrase ``in writing'' may appear as part of a wider phrase or be defined differently in different statutes, but clause 8 will apply whenever the phrase appears.
My hon. Friend the Member for Ellesmere Port and Neston (Mr. Miller) made an important point. I am keen for the powers provided under clause 8 to be used extensively to modernise the statute book as quickly as possible. As I said on Second Reading, my right hon. Friend the Minister for the Cabinet Office, who is responsible for e-government, is already working with other Government departments to ensure that each Department examines the statutes for which it is responsible in order to ascertain in which cases it can move rapidly to introduce electronic equivalents. A timetable for completing that has not yet been specified, but I am drawing to the attention of my colleagues in different Departments the need to move with considerable urgency. We are leading by example in my own Department, which is already preparing under clause 8 a draft order that relates to company law, to enable us to consult on it early in the new year and have it ready for introduction as soon as the Bill becomes law and clause 8 comes into effect.
On electronic conveyancing, the Law Commission is currently considering conveyancing and land registration for the 21st century, and examining what needs to be done to implement electronic conveyancing, but a firm date cannot yet be given for its introduction. I believe that my right hon. Friend the Lord Chancellor will want to consult fairly widely on the matter. However, we have been considering with officials in the Lord Chancellor's Department and with the Law Commission the possibility of using clause 8 powers to facilitate at least some necessary statutory modernisation and in turn enable electronic conveyancing. Further information will be given to the House as soon as the timetable for that becomes clearer. It was in the course of that consideration that we realised that these amendments were necessary.
Amendment agreed to.
Amendments made: No. 30, page 7, line 5, after `done' insert
No. 31, in page 7, line 7, after `is' insert
No. 32, in page 7, line 9, after `is' insert
No. 33, in page 7, line 11, after `be' insert
`delivered as a deed or'.
No. 34, in page 7, line 20, after `is' insert
Mr. Duncan: I beg to move amendment No. 53, in page 7, leave out lines 42 and 43.
Clause 8(4) lists several provisions that may be included when the Secretary of State exercises his power to make an order. The first half of paragraph (d) reads rather well, referring to
``provision, in connection with anything so authorised, for a person to be able to refuse to accept receipt of something in electronic form'',
I am concerned that that constitutes an open-ended stipulation, which will allow the Secretary of State to compel people to use electronic signatures for the electronic storage of such transactions. The Bill should be permissive—people should be allowed to do all those things; they should not be compelled to do so because that would create a form of apartheid between those who could and those who could not use electronic signatures. We enjoy a world of variety, and some people may want to keep up with the times at the leading edge of technology and modernity, as the Labour party pretends to be, while others prefer to live in the sticks.
but in my view a full stop is missing at that point. Up to that point, it makes good sense, and should appear in the Bill. However, what follows is:
``except in such circumstances as may be specified in or determined under the order''.