21 Jan 2011 : Column 1125

House of Commons

Friday 21 January 2011

The House met at half-past Nine o’clock


[Mr Speaker in the Chair]

Mr Greg Knight (East Yorkshire) (Con): I beg to move, That the House sit in private.

Question put forthwith (Standing Order No. 163).

The House proceeded to a Division.

Mr Speaker: I ask the Serjeant at Arms to investigate the delay in the No Lobby.

The House having divided:

Ayes 0, Noes 34.

Division No. 178]

[9.34 am


Tellers for the Ayes:

Mr Peter Bone and

Mr Philip Hollobone


Beith, rh Sir Alan

Brown, Lyn

Burns, Mr Simon

Djanogly, Mr Jonathan

Duncan, rh Mr Alan

Fabricant, Michael

Fitzpatrick, Jim

Flello, Robert

Gauke, Mr David

Gibb, Mr Nick

Grayling, rh Chris

Griffiths, Andrew

Harrington, Richard

Harris, Rebecca

Heath, Mr David

Hendry, Charles

Hillier, Meg

Hodgson, Mrs Sharon

Hurd, Mr Nick

Javid, Sajid

Jones, Graham

Luff, Peter

Morgan, Nicky

Newton, Sarah

Randall, rh Mr John

Robertson, Hugh

Sanders, Mr Adrian

Shapps, rh Grant

Smith, Miss Chloe

Stephenson, Andrew

Sutcliffe, Mr Gerry

Walley, Joan

Weatherley, Mike

Wright, Jeremy

Tellers for the Noes:

Jacob Rees-Mogg and

Mr David Nuttall

The Speaker declared that the Question was not decided because fewer than 40 Members had participated in the Division (Standing Order No. 41).

21 Jan 2011 : Column 1126

Joan Walley (Stoke-on-Trent North) (Lab): On a point of order, Mr Speaker. It relates to Standing Orders Nos. 11, 12, 13 and 14. Standing Order No. 12 states:

“Unless the House otherwise orders, the House shall not sit on any Friday other than those on which private Members’ bills have precedence.”

Standing Order No. 14, on the arrangement and timing of public and private business, states that

“government business shall have precedence at every sitting”

and paragraph (4) states:

“Private Members’ bills shall have precedence over government business on thirteen Fridays in each session”.

May I suggest, Mr Speaker, on the evidence of the time-wasting that we have seen not just today but regularly on Fridays, that, given that Members of the House come here to bring forward legislation—such as my Public Bodies (Sustainable Food) Bill, which is not mischievous and has not yet had a Second Reading and is unlikely to have one—it is time that this House, through the proper channels and the Procedure Committee, reconsidered how we deal with private Members’ business so that we can make progress and so that those Members of Parliament who are elected to this House have a genuine opportunity to get legislation on to our statute book? That is what the public expect of us.

Mr Speaker: I am grateful to the hon. Lady for her point of order and for advance notice of it. I have considerable sympathy for her and for other Back-Bench Members who have worked hard to bring their Bills to the House for debate. How today’s proceedings unfold is a matter for the House and the use of time and procedure is in the hands of individual Members. The Chair of the Procedure Committee is in the House today and he might welcome a memorandum from the hon. Lady setting out her analysis of the problem and the solutions that she proposes. I hope that is helpful both to the hon. Lady and to the rest of the House.

Mr Greg Knight (East Yorkshire) (Con) rose—

Mr Speaker: I shall take a very brief point of order from the right hon. Gentleman and we shall then proceed.

Mr Knight: Further to that point of order, Mr Speaker. I rise only to say that your conclusion is correct. I would welcome further discussions with the hon. Member for Stoke-on-Trent North (Joan Walley) and, indeed, we have already spoken in the margins of the Chamber to agree to do just that.

Mr Speaker: I am grateful to the right hon. Gentleman for what he has said.

21 Jan 2011 : Column 1127

Estates of Deceased Persons (Forfeiture Rule and Law of Succession) Bill

[Relevant documents: The Sixth Report from the Justice Committee, Session 2009-10, on Draft Civi l Law Reform Bill: pre-legislative scrutiny, HC 300, and the Government response to the consultation on the draft Bill .]

Second Reading.

9.52 pm

Mr Greg Knight (East Yorkshire) (Con): I beg to move, That the Bill be now read a Second Time.

It is an unexpected privilege to be here. I have signed the book for the ballot for private Members’ Bills every year since 1983, apart from four years when, due to the electorate, I was elsewhere. It therefore came as rather a shock to find that this year my name was in the top 20.

Of course, as the House will know, the ballot is only the start of the process, and today is only a little further down the long road that one has to take to seek to change the law of the land. Indeed, the statistics are not encouraging. I understand that only 10% of private Members’ Bills succeed, so a private Member’s Bill is a very fragile vessel. As I look around and see my hon. Friend the Member for Bury North (Mr Nuttall) in his place, and as I am aware that my hon. Friend the Member for Christchurch (Mr Chope) is in the building, I even wonder whether the word “fragile” is appropriate. Perhaps “brittle” is a more appropriate word. I hope that when I have explained the purpose of the Bill, they will decide that it is something they can support.

Joan Walley (Stoke-on-Trent North) (Lab): I am most grateful to the right hon. Gentleman for his positive remarks about considering the issue of private Members’ Bills. Does he agree that one of the problems of our archaic system and how we deal with private Members’ Bills is that a great deal of filibustering goes on in this place, rather than action that makes our Parliament fit for purpose?

Mr Knight: If I may respond to that en passant, as it were, I accept that argument. The Procedure Committee has not yet considered this, but an argument can be made that we could consider bringing in a process whereby when a private Member’s Bill has had three hours of debate the question is then put. The Procedure Committee would wish to consider that option, although I would not wish to prejudge how it might decide to form its view on that proposition. That certainly could be done and it would mean that we would have more debates, which, in my view, is a good thing.

The next duty of anyone who comes fairly high in the ballot is to decide on the subject. Hon. Members basically make a choice in one of two areas. Either they choose a subject of great controversy or perhaps startling change and to have their day in the sun on Second Reading, knowing that the Bill will be opposed by the Government and even by the official Opposition and will be talked out, or they look for something less controversial but worthy in the hope that they can get it on to the statute book. I have to be honest and say that my first choice was to introduce a daylight saving Bill, but I was usurped by my hon. Friend the Member for Castle Point (Rebecca Harris), who was higher up the ballot and who, to her great credit, has successfully piloted her Bill to Committee. I wish her well with it. Because of

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her decision, I decided to look around for another less controversial but worthy proposition, and I decided that I wanted to introduce a Bill that would make our law fairer in some way.

I had cause to look at some of the recent work of the Law Commission and of the Select Committee on Justice—I am delighted to see that the Chairman of that Committee, the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith), is in his place—and I observed some of their reflections on the forfeiture rule and the law of succession. I therefore decided on my present Bill. I accept that it is not likely to be the talking point of the week in the village pub, but it deals with three related areas where, in my view, a small change in our law is both warranted and desirable.

I must tell the House that due to the complexities of the subject, this will not be a speech full of soundbites. I shall give some background. The Bill seeks to amend the law of succession in England and Wales where a person disclaims—that is, rejects—an inheritance or is disqualified from receiving an inheritance by reason of the forfeiture rule. What is the forfeiture rule? It has long been a doctrine of the common law of this country and I think it is a good doctrine to which no reasonable person could take exception. It states that if a man or woman is criminally responsible for the death of another, neither he or she nor his or her elected representatives can be entitled to reap any financial benefit from that act. As Lord Justice Salmon said in the case of Gray v. Barr, which was reported in 1971, 2 All England Reports at page 974:

“it would in general, shock the public conscience if a man could use the courts to enforce a money claim either under a contract or a will by reason of his having committed such act”—

that is, the act of murder.

Experience has shown that there are some cases—they might be few, but they are hard cases—where the public conscience would not want the full forfeiture provisions to apply, such as those involving mercy killings, the survivor of a suicide pact initiated by the non-surviving party and perhaps a battered wife driven almost beyond the borderline of sanity by the cruelty of a violent spouse. In such cases, the criminal courts will normally have been merciful and might have not even awarded any custodial sentence in the criminal proceedings. It was to deal with these situations and cases like them that the Forfeiture Act 1982 was passed. That Act provides for discretion to be applied by the courts in cases of manslaughter—I emphasise the word manslaughter, because there is no discretion in cases of murder. In cases of manslaughter where mitigating circumstances exist, the courts can allow the forfeiture rule to be relaxed, where appropriate.

The current rule is defined in section 1 of the 1982 Act as meaning the rule of public policy, which in certain circumstances precludes a person who has unlawfully killed another or unlawfully aided, abetted, counselled or procured the death of that other from acquiring a benefit in consequence of the killing.

My Bill gives effect, with some modifications, to the recommendations set out in the Law Commission’s 2005 report, “The Forfeiture Rule and the Law of Succession”. The subject of forfeiture and succession was referred to the Law Commission following the very unsatisfactory case of Re DWS (deceased) 2001. Briefly, the facts of that case were that a person, whom I will call P, killed both his parents, neither of whom left a

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will. The court had to decide who was entitled to inherit P’s father’s estate under the intestacy rules, which are specified in sections 46 and 47 of the Administration of Estates Act 1925. P was not allowed to inherit because of the forfeiture rule, which I have just outlined. However, P’s child, the grandchild of P’s victims, could not inherit in place of P, because under the intestacy rules P was still alive and therefore P’s child could not take an interest in the estate. In that particular case, the victim’s estate therefore passed to a sister, which was unsatisfactory because by the time the court reached its conclusion the sister herself had passed away.

The Law Commission considered that the outcome of that case was unfair, and I agree. Equally unfairly, however, a situation might arise in which a killer forfeited an inheritance under a will. I do not believe that allowing a killer’s children to inherit from the victim in those narrow circumstances would encourage anyone who would not otherwise do so to commit a murder or attempted murder. The alternative is to stay with our present law and disinherit innocent children, which is most unfair. In any event, the law offers protection to prevent a killer from benefitting from a forfeited inheritance that passes to a minor, because the court has power on application to appoint two trustees or more where a minority interest arises on intestacy. It also has the power to pass over any person with a prior interest in a grant of letters of administration and appoint someone else to run the estate.

Similar problems can also occur where a person disclaims an inheritance under a will or on intestacy. For example, where in an intestacy—to the non-lawyers among us, that means where there is no will to say what should happen to the estate—the person who disclaims is the only child of the deceased, the inheritance will bypass the child’s descendants, because grandchildren can only inherit from their grandparent if their parent dies before the grandparent, in which case the inheritance passes instead to the deceased’s other, but more distant, blood relatives.

Let me give the House an example of how that might arise. Let us say that A, the deceased, dies and leaves a fortune, money which he lawfully made from his ownership of a nightclub and casino. He does not leave a will, but dies leaving a son, B, and two grandchildren, C and D. B is a strict follower of Victorian values and is a devout Baptist Christian, unlike his father. His views are similar to those of the Southern Baptist Theological Seminary in the USA, which holds the views that God’s way is that we should earn what we get and that gambling is a sin. Because of those beliefs, B decides that he cannot in all conscience accept the legacy, so he disclaims—that is, he gives up his entitlement to money from his father’s estate. Under our law, in so doing he would prevent his own children, C and D, from inheriting, which applies even if they were to welcome the inheritance with open arms. Indeed, C and D might have embraced gambling as passionately as their own father had disowned it, but that would make no difference. Under our law, the inheritance would go elsewhere, which is neither right nor fair. That is why I am seeking to make a change with my Bill.

Jacob Rees-Mogg (North East Somerset) (Con): If the strict Baptist did not want the money to go to his children, because he thought that

“the wages of sin is death”,

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would he be able to take the inheritance and give it away, which would have the same effect as disclaiming, and therefore not lose his right to make that choice?

Mr Knight: B would be able to do that, although our law clearly states that one cannot refuse part of an inheritance—it is all or nothing. Once the decision is made, one cannot change one’s mind, unless others have not acted on one’s initial decision, in which case one can. The son would be at liberty to accept the inheritance and then give it away—indeed, he could give it to the church of which he was a member.

Stranger things happen where there is a will. If someone decides to give up something that they have been bequeathed in a will, what happens depends on the wording of the will. Such cases would need individual consideration.

Mr Christopher Chope (Christchurch) (Con): I apologise to my right hon. Friend for not being here at the outset of his remarks, but I have indicated to him informally my concern that that particular aspect of his Bill may have the unintended consequence of creating a loophole, whereby people can avoid inheritance tax. In the example that he gave, the money would go directly to the grandchildren as a result of his Bill, which means that by disclaiming B would be able to pass the money on to the next generation, whereas normally he would be able to do so only by incurring a potential inheritance tax liability, if he did not survive for seven years after so doing.

Mr Knight: Under our existing law, there are various reasons why people may disclaim an inheritance, and reducing one’s tax liability is already one of them. For example, someone might decide not to accept an inheritance, where it involved taking on a property that was subject to a long lease that included expensive repair covenants.

Many people in the world, as well as in this country, seek to reduce the amount that they pay in tax. Some seek to do it by concealing their wealth, lying to the authorities and completing inaccurate and misleading tax forms. They are tax evaders—they break the law, and when they are caught, they are properly punished. Others seek to lower their tax liability by making perfectly lawful decisions affecting their own position, which is called tax avoidance rather than tax evasion. There is nothing unlawful about tax avoidance, and I am surprised that my hon. Friend, who is a Conservative Member of Parliament, feels that it is somehow inappropriate.

If a person who is on their deathbed inherits a legacy, and they are worried that by accepting the money, which they will not have time to spend, they will incur a greater inheritance tax bill, I see nothing wrong with such a person disclaiming. If my Bill were law, disclaiming would mean that person’s disclaimed money going to their children, which would be all the better. That person would have reduced their tax liability in a perfectly lawful way, and what is wrong with that? I hope that on reflection my hon. Friend will decide that his point, which he might initially have thought was a good one, is not actually a good one.

Mr Chope: My concern in examining legislation in detail is, as my right hon. Friend knows, to make sure that there are no unintended consequences. I am grateful to him for making it clear that this is an intended consequence of his Bill.

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Mr Knight: It could be a consequence, but it is not the prime reason behind the Bill.

When the Law Commission looked at the laws of succession, it highlighted the anomalous situation involving the children of a deceased minor. That is also covered by my Bill, which addresses the irregular situation in which the children of a minor who is entitled to inherit an interest in the estate of an intestate person, but who dies unmarried and without entering into a civil partnership before reaching 18, are unable to inherit their parent’s interest in that estate for no other reason than that the law says so. I think that is unfair and I will elaborate on this issue later.

First, let me comment on specific clauses in the Bill. Clause 1 would amend part 4 of the Administration of Estates Act 1925, which sets out how a deceased person’s estate is to be distributed in the absence of a will or to the extent that a will is not valid. Clause 1(2) would insert proposed new section 46A into the 1925 Act. Subsection (1) of new section 46A specifies that the new section would apply where a person, X, disclaims an inheritance or is disqualified from inheriting because of the forfeiture rule. Subsection (2) of new section 46A provides that for the purpose of deciding who should inherit X’s interest in the deceased’s estate in those circumstances, X should be deemed to have

“died immediately before the intestate.”

That overcomes the rule in current intestacy law, under section 47(1) of the 1925 Act, that children cannot inherit if their parents are still alive. That Act, which is still on our statute book after all this time, was drafted and introduced by the first Earl of Birkenhead, who I believe is the subject of one of your forthcoming lectures, Mr Speaker, which I hope to attend.

The effect of the reform is that if a person disclaims or is disqualified under the forfeiture rule, the inheritance to which he or she is no longer entitled will go to the next person listed in the order of priority in section 46 of the 1925 Act, even though the person who disclaimed or suffered the forfeiture is still alive. Subsection (3) of new section 46A provides that the new rule would not limit the court’s power under section 2 of the Forfeiture Act 1982, under which the court has powers to modify the effect of the forfeiture rule where the offender has not been convicted of murder, for example by allowing the killer to inherit all or part of the estate. The circumstances in which the court would exercise that power would be the examples I gave earlier, in the case, perhaps, of a mercy killing, in which the deceased was the instigator of the act and the loving relative was complying with their wishes. The rule introduced by new section 46A gives way to any order made by the court under section 2 of the Forfeiture Act, which would override it.

Clause 1(3) would make a consequential amendment to section 47(1) of the 1925 Act. Section 47(1) defines the statutory trusts for descendants or intestacy, providing that no grandchild or remoter descendant may inherit if his or her parent is still alive when the intestate dies. That is clearly inconsistent with proposed new section 46A, which would treat the offender has having died before the deceased. Clause 1(3) would therefore insert “(subject to section 46A)” into section 47(1) to ensure consistency with the new rule.

Clause 1(4) makes another consequential amendment, inserting a new subsection, 4A, after section 47(4)

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of the 1925 Act. New subsection 4A states that subsections (2) and (4) of section 47 are subject to new section 46A.

Section 47(2) of the 1925 Act currently provides that where no descendant of the intestate attains a vested interest by reaching the age of 18, marrying or entering into a civil partnership under that age, the estate is to be distributed as if the intestate had died without issue. Section 47(4) applies a similar rule to the statutory trust for siblings or issue of siblings, defined by section 47(3). For the same reasons as apply in relation to the amendment made by clause 1(3), new subsection 4A will ensure that sections 47(2) and 47(4) are consistent with the new rule.

Clause 2 deals with disclaimer or forfeiture of a gift under a will, and makes analogous provision to that made by clause 1 in relation to intestate succession. It inserts a new section after section 33 of the Wills Act 1837 and makes one consequential amendment to that section. In both those situations, the will is to be interpreted as if the person disclaiming or the person forfeiting had died immediately before the testator, the effect of this being that the person next entitled to the property will be able to inherit. I would not want, in any proposition I put before the House, to tamper with the express provision of a will, and this Bill would not do that. The general rule I have mentioned gives way to a contrary intention shown in a will. That is consistent with section 33 of the Wills Act, which also gives way to a specific contrary intention in the testator’s will. The new rule in clause 2 would, as with clause 1, give way to any order of the court made under section 2 of the Forfeiture Act to give relief to the killer from the effect of the forfeiture rule where the court decided that was appropriate.

Clause 3 deals with the death of a single parent aged under 18, in relation to which there is an anomaly in the law of intestacy. Where a child, C, of a deceased who dies intestate is entitled to a benefit but dies under the age of 18 without having married, but leaves a child or children, the law is unfair to that grandchild or grandchildren. Currently, C’s benefit does not pass to his or her children because by dying an unmarried minor, C does not attain a vested interest in the intestate’s property under the intestacy rules and therefore has no interest to pass on to his or her children. In such cases, the inheritance passes instead to the intestate’s other, more distant, blood relatives. That clearly discriminates against the children of single parent minors. Since 1991, illegitimacy has not been not a bar to intestate inheritance, and such children qualify as grandchildren of the intestate. This problem would not arise if the child-mother was married, or if the grandchild or grandchildren were catered for in a will. The law of intestacy discriminates against illegitimate grandchildren: they are penalised because their mother is young and unmarried and because the deceased failed to make a will.

Some people—I hope none of them are in the Chamber—may feel that this bizarre rule is good news because it is a clear case of the law encouraging marriage and acting as a disincentive to young, unmarried girls becoming pregnant. I do not accept that argument, because although the present law prevents the children of unmarried teenage mothers—and fathers, come to that—from inheriting any interest that their parent may have had in the estate of the intestate person, they can inherit in other ways and can inherit other property.

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Sir Alan Beith (Berwick-upon-Tweed) (LD): An even more telling point is that someone who has got into that situation without taking any precautions is, to put it mildly, extremely unlikely to be aware of this bizarre provision of the law.

Mr Knight: I accept that point absolutely and completely. The effect of the law does not produce the outcome that the intestate person in most cases would have wished anyway, and my Bill seeks to correct that anomaly.

There are a number of ways in which the state can and should seek to dissuade teenage pregnancies, but using the law of intestacy should not be one of them. I am not convinced that after a night out at a disco or bar, just before the moment of unprotected sex—perhaps in the back of a car—two young teenagers are going to feel in any way dissuaded from having sexual relations, and possibly thereby conceiving a child, by the expectation that they may die before reaching 18 or marrying, and thereby disinherit an unborn child that they might or might not be about to create. I absolutely agree with the comments made by the Chair of the Justice Committee.

We hope that most children are brought up in a loving relationship. Let us think of the poor child, who has an unmarried mother who is killed before she reaches the age of 18. What does the state say to the child? “Because of these circumstances, you will not be helped; you will not be able to inherit money that you would have inherited from your grandparents if your mother had reached the age of 18.” Clause 3, therefore, inserts new subsections (4B), (4C) and (4D) into section 47 of the 1925 Act. I remind the House that that Act lists what happens on intestacy. The subsections inserted by the clause deal with the situation of the young child of an intestate who dies under the age of 18 without having married or formed a civil partnership. As C is a minor at the date of Y’s death in the example, his or her interest in Y’s estate will be held in the statutory trusts imposed by the 1925 Act.

On commencement, clause 4(4) provides that only deaths occurring after the commencement of the Bill will be covered by it. Knowing, in this cost-conscious age in which we live, my hon. Friends’ concern about the financial implications, I draw their attention to the fact that the implementation of the Bill is not expected to impose any additional burden or to increase any other public expenditure.

Mr Chope: My understanding is that the Bill incorporates part of the recommendations of the Law Commission, which were going to be legislated for by the Government, but the Government decided not to legislate for those because they said it would be too expensive to do so. How is that action by the Government consistent with what my right hon. Friend says—that nothing in the Bill would add to the costs to the public purse?

Mr Knight: My Bill is not precisely the same as the Bill proposed by the Law Commission; I have made a number of changes to it. I stand by what I just told the House. I am sure the Minister will deal with this point in further detail if it is felt that I am incorrect, but I suspect that the reason my hon. Friend the Member for Christchurch (Mr Chope) is confused is as follows. The Law Commission suggested that special trust provision for minors in forfeiture cases be set up, and when the Ministry of Justice consulted on the special trust provision

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proposals, which may have played a part in the issue of cost, several criticisms were made of them. Some consultees doubted that they were necessary, and I understand that the Ministry of Justice—I stand to be corrected by the Minister—re-examined those proposals with the Law Commission, and they both then changed their mind and agreed that the proposals were unnecessary. I have not suggested otherwise because I take the view that the law already provides protection for minors’ inheritances. That may answer my hon. Friend’s point.

Mr Chope: My right hon. Friend is giving the Government an absolute discretion as to when his Bill would be brought into effect. Why is he doing that rather than saying that the Bill should come into effect three months after obtaining Royal Assent?

Mr Knight: I am doing that for the simple reason that I have confidence and trust in the coalition Government and I saw no reason to seek to override them on so footling a matter. If the Minister tells the House that he supports the Bill—which I hope he will in a moment—I expect him in good faith to see that the Bill is brought into effect as soon as is reasonably possible. Because I have confidence, particularly in this ministerial team, I decided to leave it to the Government to make that decision.

Sir Alan Beith: I return to the point that the Law Commission had made. Its recommendation about creating trust provisions—originally with the Public Trustee—arose from an anxiety that money should be administered without benefit, particularly indirect benefit, to a killer. Although that could have been done by private trustees rather than the Public Trustee and without public cost, its original thinking was that something along those lines was needed. Is the right hon. Gentleman confident that he was right not to include it in the Bill?

Mr Knight: I think so, because the court has power to determine who manages an estate, and I would have thought that that power was sufficient. If the court felt that the estate was being manipulated by an incarcerated prisoner—the father who had murdered the grandparent—I would have thought that the courts would have power to intervene and take over the management of the estate. That was why I did not include those provisions in the Bill, particularly when I noted that there had been further discussions between the Ministry of Justice and the Law Commission and that they had both reached the conclusion that the special trust provision was unnecessary. I assumed, and still do assume, that because that was where the debate ended up, we need not bother with that extra tier of bureaucracy in the Bill. However, should the Bill be given a Second Reading and should evidence to the contrary arise, I am happy to look at the matter by way of possible amendment to the Bill—although I hope and believe that will not be necessary or desirable.

On public manpower, I tell my hon. Friends that no change in the work load of any Government Department or agency is anticipated if the Bill is implemented. Usually, Ministers have to make a statement about compatibility with the European convention on human rights. I am delighted to say that this is not a Government Bill, so it does not require a statement under section 19(1) of the Human Rights Act 1998. However, if it did, my understanding of that Act is that the provisions of the Bill are compatible with the convention in any event.

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The Bill extends to England and Wales, and as my hon. Friend the Member for Christchurch has said, it will come into force when the Minister so determines should it pass through all its stages in both Houses. I am sure, if he supports the Bill, that he will not stand in its way.

The Bill is merely intended to make our law fairer, by removing technicalities that run contrary to the general policy of the law of succession. It will allow direct descendants to inherit ahead of more distant relatives on intestacy. Where there is a will, the Bill will allow the people whom the deceased intended, or could be assumed to have intended, to take the inheritance if the deceased’s first intended recipient does not. More importantly, the Bill will produce an outcome that is fair, rather than one based on legal technicalities.

I am most grateful for the courteous and helpful assistance that I have received from the Minister, his departmental team, Officers and servants of the House and members of the Law Commission to whom I have spoken. I am also grateful to the Justice Committee, which has indicated its support for the measure, and for the comments made by its Chairman, my right hon. Friend the Member for Berwick-upon-Tweed, whom I am delighted to see with us today. Finally, I am most grateful to all hon. Members for giving me a fair hearing today. I hope that they will in due course give this modest but worthy Bill a Second Reading.

10.31 am

Sir Alan Beith (Berwick-upon-Tweed) (LD): I congratulate my right hon. Friend the Member for East Yorkshire (Mr Knight) on introducing the Bill and on his lucid presentation of a complex matter. Of course, as he indicated, the background is that a draft Civil Law Reform Bill was published in the last Session of Parliament and the Justice Committee studied the Government’s request in some detail. His Bill takes up a significant part of the draft Bill. Meanwhile, the Government have decided not to proceed with it.

I received a letter, dated 16 December, from the Under-Secretary of State for Justice, the hon. Member for Huntingdon (Mr Djanogly), who is dealing with the debate today, indicating how grateful the Government were for the Justice Committee’s report, but he said that

“as the draft Bill does not contribute to the delivery of our key priorities, we have decided not to take it forward.”

I am not unsympathetic to the Government’s decision not to proceed with the draft Bill in this Session. It is complex; it would require a lot of ministerial time and attention; and the Department has many urgent priorities to deal with. But I hope that the Government have not closed the door on sorting out some of the laws with which it deals.

Much of the draft Civil Law Reform Bill related to bereavement and dependency damages and damages in respect of gratuitous care under the Fatal Accidents Act 1976. It was complex; the Justice Committee did not agree with it all; and further work clearly needed to be done. I hope that that work is not brought to a complete halt by the decision not to proceed in this Session and that it can be taken forward in other Sessions. Of course, if that does not happen, it raises yet

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again a question that we have come up against several times: why have a Law Commission, which consumes considerable public resources in doing detailed and careful work on laws that need to be improved and brought up to date, if its recommendations are not implemented? Judicial time, as well as public expenditure, is involved. The record of successive Governments in implementing Law Commission recommendations is not very good.

However, into the breach has stepped my right hon. Friend to deal with laws that are significant to a small number of people. By definition, those few people are in pretty serious and challenging circumstances, particularly where a killing has taken place in the family or where a death—indeed, a death of a minor—has occurred. Those are awful family circumstances in which we want the law to be helpful, not unhelpful.

When a person dies without a valid will in England or Wales, intestacy laws determine who will inherit his or her property. Succession law is generally aimed at benefiting descendants in preference to other, more remote family members, and the order for doing so is set out in the Administration of Estates Act 1925—spouse, children, parents, siblings, half-siblings, grandparents, aunts and uncles, and half-aunts and uncles—and when no relative survives, the deceased’s money goes to the Crown.

Currently, the common law forfeiture rule prevents a person convicted of an unlawful killing from benefiting from the victim’s death, irrespective of whether the victim had made a will. Murderers are always prevented from benefiting from their victims’ deaths, but the court has discretion over whether to apply the forfeiture rule in cases of manslaughter or other forms of unlawful killing.

A child who has murdered his or her father cannot therefore inherit the father’s estate, even if he made such provision in his will. His or her children—the victim’s grandchildren—also cannot inherit because section 47 of the Administration of Estates Act 1925 and section 33 of the Wills Act 1837 require the death of the parent before the child can inherit from the grandparents.

The impact on a grandchild when his parent forfeits a grandparent’s estate under the forfeiture rule was heavily criticised in the case of Re DWS in 2001, where a father had murdered both his parents. Both grandparents died without a will, and the Court of Appeal held that it had no power to treat the father, who was disqualified from inheriting by reason of his crime, as deceased, which would have allowed the grandson to inherit. The estate therefore went to other relatives. That led to the issue being referred to the Law Commission.

In such unusual circumstances, children who are indirect victims of a grave crime are denied the support that the murdered person would have wished them to have. Either they have expressed that wish in a will, or, having failed to do so, everyone realises that that is what the deceased person would have wanted. Added to the loss of a loved family member comes the loss of the benefit that that family member would have wished them to have.

The Bill would deem the person who disclaimed an inheritance or who is precluded by the forfeiture rule from inheriting as having died immediately before the deceased, unless the relevant will contains a contrary provision. Property would therefore to go to grandchildren,

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rather than more distant relatives, unless the deceased has explicitly excluded them from inheriting the estate in the will—a “deemed predeceased rule” is the legal term.

My right hon. Friend was also dealing with, and referred to, another anomaly: the case of the unmarried minor who has a child but dies without having married or entering a civil partnership. The Bill will allow the child to inherit in those circumstances by deeming that the parent died before the person from whom he or she was inheriting.

All that closely follows the Law Commission’s recommendations in the 2005 report, “The Forfeiture Rule and the Law of Succession”. That leaves only the commission’s recommendation that, if as a result of its other recommendations, property devolves on or is held for a minor descendant of a killer, the court should have the power to order that the property be held by the public trustee, who should administer it in order to avoid benefit to the killer.

There was a reason for that recommendation. Professor Hugh Beale, the law commissioner who led on the report, told the Justice Committee:

“We were worried that somehow the killer might benefit indirectly or directly by, as it were, either being able to get hold of some of the trust money, perhaps by influencing the trustee or possibly by encouraging the trustee to take on responsibilities which otherwise the killer himself or herself would bear: maintenance responsibilities”,

for example. The Government’s original draft Bill would have enacted that recommendation with a minor alteration: the court would have been required not to appoint the public trustee, but to consult the public trustee, who could then advise on a more suitable private trustee. Professor Beale described that as an “eminently sensible change”.

Concerns were raised by witnesses about the loose drafting of the relevant clause, which referred to

“an infant who is a child or remoter descendant of the offender”.

We recommend that the Government re-examine the drafting of what were then clauses 15 to 17, in the light of comments from the Bar Council and the Law Society. We expected all minors to receive suitable protection under the draft Bill. We said that we shared the Law Society’s concern that nothing should be done to impair the validity of existing wills. We welcome the proposal to ensure that minors who inherit under that provision have their inheritance protected. Whether there is a problem that ought to be dealt with, and could be dealt with without creating secondary problems, is worthy of at least some further consideration in Committee.

The primary argument against changing the law as proposed in the draft Bill, referring to the provision about minors, was discussed in an earlier intervention: the idea that the forfeiture rule could have a deterrent effect. The concept of deterrence is stretched at the best of times. Many crimes are committed with total unconcern for the consequences that might follow if someone were detected and brought to justice. The remotest and weirdest notion of deterrence would arise in circumstances when a child was conceived unexpectedly by a minor who did not then get married or enter a civil partnership—deterrence coming into play at that point is plainly absurd. The Law Commission took the view that killers were unlikely to be influenced by such changes in the law. That consideration is completely outweighed by the injustice

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that would be done to the deceased, whose property would be inherited by more distant relatives, and to the innocent children.

It was the effect of the present rules on innocent children in particular that influenced me in supporting the Select Committee view that the Law Commission proposals should be implemented. However, more generally, as I said in my opening remarks, we are concerned at the poor record of implementing Law Commission proposals. Our report said, at paragraph 194:

“We believe the delay in legislating on Law Commission recommendations is not only demoralising for that organisation but leads to a waste of limited resources because case law can change the legal context while recommendations await implementation requiring further consideration of the proposed changes. The last 10 years has seen a vast amount of criminal justice legislation introduced by the Government. In contrast, civil law measures have sometimes being neglected, to the public detriment.”

We are all grateful to the right hon. Member for East Yorkshire for filling part of the gap. In wishing his Bill success, I hope to prompt the Government not to neglect the area of civil law.

10.42 am

Robert Flello (Stoke-on-Trent South) (Lab): I congratulate the right hon. Member for East Yorkshire (Mr Knight) on bringing the Bill to the House. I know the pressures and pitfalls associated with promoting a private Member’s Bill all too well, following my own experience with the Sustainable Livestock Bill. I hope that his hon. Friends will be somewhat pithier in their contributions when debating his Bill than they were on 12 November. I particularly noted the right hon. Gentleman’s opening remarks. Parliamentary observers—those outside the Chamber—will have seen the usual suspects in the House today and will know that we are probably in for a long sitting.

Mr Knight: In case the hon. Gentleman has not appreciated the fact—although, knowing him, I am sure he has—may I place it on record that when the House debated his Bill, I was one of his supporters? I hope that today he is feeling generous enough to return the compliment.

Robert Flello: I always like to be generous and, indeed, I thank the right hon. Gentleman for supporting my Bill on 12 November. I wish, sadly, that some of his colleagues had felt the same way.

The right hon. Gentleman did an extremely good job; he gave a valuable explanation, with examples that clarified the existing law and its application. I also congratulate the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) on his usual measured and thoughtful contribution to the debate. I concur that further consideration in Committee would be valuable to look at some of the detail. Despite 40 minutes or so of the right hon. Member for East Yorkshire introducing his Bill, some issues still need to be teased out in Committee.

If enacted, the Bill would address the concerns raised by the Law Commission in its 2005 report, “The Forfeiture Rule and the Law of Succession”. The report proposed amendments to the law as it stands, whereby grandchildren of a deceased individual are disallowed from inheriting property and suffer from what might be described as the

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sins of their parents being visited upon them if the parents were responsible for the murder of the deceased. The current law disinherits grandchildren of the deceased when their parent forgoes their inheritance, and it also applies when the parent is an unmarried minor on inheritance and dies without attaining majority, or marrying or entering a civil partnership.

The report’s headline recommendation was that a deemed predeceased rule be used when a child or relative has either murdered the deceased or opted to disclaim the inheritance, thereby forfeiting their entitlement to it. The child would be considered to have died shortly before the parent, and the law would then allow for the grandchild to inherit.

As the debate over the rights and wrongs of assisted suicide continues, and cases of patricide and matricide sadly continue to occur, the Bill is timely, and the Opposition believe it addresses a clear injustice. Indeed, the previous Labour Government accepted the recommendations of the Law Commission report, and in December 2009 produced the draft Civil Law Reform Bill which, among other things, incorporated those recommendations. The Bill was welcomed by the Justice Committee and it is disappointing that the current Government chose not to proceed with the measures in it.

I welcome the Bill introduced by the right hon. Member for East Yorkshire and I am pleased that he has used his favourable draw in the private Members’ ballot to bring forward legislation that reflects the combined wisdom of the Law Commission, and indeed the previous Labour Government. The Bill would take forward, with some modifications, clauses in part 3 of the Civil Law Reform Bill and despite the Government’s decision not to take forward that draft Bill, I am pleased that the Front-Bench team have—I believe—indicated that they do not oppose the Bill before us today.

The forfeiture rule is, of course, part of the wider principle that an individual should not profit from a crime they have committed. The previous Government strengthened that principle through such legislation as the Proceeds of Crime Act 2002, and the Labour party in opposition continues to support it. The forfeiture rule prevents an individual from inheriting property from someone, through a will, when they have unlawfully killed the deceased or unlawfully aided, abetted, counselled or procured the death. The rules as they stand would disallow a grandchild of the deceased from inheriting anything in such a situation—a rule the Bill seeks to amend.

The Law Commission report stated that the law as it stands is unfair for three reasons: grandchildren should not be punished for the sins of their parents; it is more likely that the deceased would have wished to benefit the grandchildren than other relatives; and the general policy of intestacy law is to prefer direct descendants to siblings and other relatives—to make an exception under the forfeiture rules is inconsistent with that policy.

The Bill introduces the deemed predeceased rule suggested by the Law Commission, whereby the child is considered to have died before the parent, and I believe it would address the Law Commission’s three criticisms. It would mean that unless stated otherwise in a will, a deceased person’s property would be distributed as though

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certain individuals—one who disclaims a gift, forfeits a gift, or a single parent dying under the age of 18—had died immediately before the deceased.

It is worth further mentioning the last of those three individuals—the single parent dying under the age of 18—as it is commendable that the right hon. Gentleman has used his Bill to address that anomaly. The current law states that when a parent dies leaving minor children, the “vested interest” of that child cannot be passed to their own children if they die before the age of 18. That is deeply unfair, so the Opposition welcome the inclusion of those provisions in the Bill.

As the debate over assisted suicide develops, or considerations as yet unknown become more important, future parliamentarians may find themselves debating the matter again. Unfortunately, when legislation is introduced to close a loophole or address a fairly narrow issue, it can in turn create new loopholes or additional issues. Those concerns notwithstanding, the Opposition have no objection to the Bill and we hope to see it proceed to Committee for further and more detailed scrutiny.

I again congratulate the right hon. Member for East Yorkshire on introducing the Bill. If it is pushed to a Division, I hope that a sufficient number of Members will join me in voting in favour of it.

10.49 am

Mr David Nuttall (Bury North) (Con): I remind the House that I am a solicitor and notary public, although I no longer hold a practising certificate for either profession.

I congratulate my right hon. Friend the Member for East Yorkshire (Mr Knight) on using this opportunity to introduce his Bill in such a selfless way. Few could have anticipated that debate on a Bill with as dry a title as Estates of Deceased Persons (Forfeiture Rule and Law of Succession) Bill would have resulted in references to unprotected sex in the back of a motor vehicle; that will certainly enliven those who read Hansard, I am sure.

I thank my right hon. Friend for clarifying, in response to an intervention by my hon. Friend the Member for Christchurch (Mr Chope), the difference between tax avoidance and tax evasion. All too often in recent months, Members on both sides of the House, including those on the Treasury Bench, have got those two terms muddled up, and have muddled them in the minds of the electorate. Historically, there has been a clear division in law between tax avoidance and tax evasion. If the Bill comes into use, by way of a disclaimer somebody might say, “That’s tax evasion, or avoidance,” but there is a big difference between the two terms, and I am grateful to my right hon. Friend the Member for East Yorkshire for making that clear.

Many Members, if they had come fifth in the private Members’ Bill ballot, would understandably be tempted to go down the road of popularism, and to use the opportunity to jump on whichever bandwagon happened to be passing. It says a great deal about the public-spiritedness of my right hon. Friend that rather than go down that path, he used the opportunity that he gained in the ballot to bring before the House this Bill, which, with the best will in the world, can be described only as a legal and technical measure. As I shall mention later, it has gone through what can only be described as a very long and tortuous period of gestation to be with us this

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morning. The Bill may be a technical measure, but it could affect many people in years to come. Many a family may well be profoundly grateful for the changes to the law of succession that the Bill seeks to introduce.

So what problem does the Bill seek to solve? Essentially, it would prevent grandchildren from being punished for the sins of their parents. In common law, it has long been the rule—often referred to as the forfeiture rule—that when someone unlawfully kills a person, they cannot benefit from the person’s estate. In short, they cannot inherit property from the deceased person whom they have murdered or otherwise unlawfully killed. Of course, even non-lawyers may be familiar with that common-law rule, as it has featured in many a murder mystery story over the years. Fans of Agatha Christie-type whodunnits may well have come across the rule as part of an interesting subplot to many a gripping yarn.

The forfeiture rule is an example of the general legal principle that a person should not be allowed to profit from his or her crime. That general common-law rule was, of course, enshrined in the Forfeiture Act 1982, which has been mentioned. I should like to clarify that the Act makes it clear that when someone is convicted of murder, the court has no discretion over whether to enforce the rule; it is only when a person is convicted of manslaughter that the court is given discretion over whether to apply the forfeiture rule in full.

As the House will be aware, a person who dies without making a will is said to have died intestate. When someone dies intestate and leaves no spouse surviving, but only a child, the law would, in the ordinary course of events, provide for that child to inherit the mother’s or father’s estate, but of course, in accordance with the rule to which I just referred, a problem arises if the son or daughter has unlawfully killed their parent.

That is more or less what happened in what is usually referred to as the leading case on the subject, which set in train the whole sequence of events that led to the Bill being brought before us this morning, and that is the case Re DWS (deceased), which was eventually quoted in the Court of Appeal in 2001. To understand the background to the Bill, I submit it is essential that the facts of that case, and the details of the judgment given, be examined, because it gives the best explanation of why the Bill is so essential.

In 1993, the son, whom I shall refer to as RS, murdered not one parent but both—Mr and Mrs S. Neither Mr nor Mrs S had made a will, and they were survived not only by their son, the murderer, but by his son—their grandson, T. T was a minor, and claimed in the court action the estates of his grandparents through his mother, who was acting, in legal terms, as his next friend, as he was of course too young to bring the action himself.

To understand the case fully, it is essential that we know what other surviving relatives there were. Mr S did not have either parent surviving him, but he did have his sister, Winifred. Sadly, by the time the case was heard, Winifred had died; she died in April 1995. The House will recall that the murder took place in 1993. Her estate was therefore represented by the persons who became the first, second and third defendants in the action. Mrs S was in a similar position; she did not have a surviving parent, but she did have a brother, Jack, and a sister, Gladys. However, although they both predeceased Mrs S, the sister, Gladys, had two children, who became the fourth and fifth defendants in the case.

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The proceedings on behalf of T, the young grandson, were launched in 1995. T, through his mother, sought grants of administration covering the estates of both his grandparents, and he sought a declaration that he was entitled to those estates once he reached the age of 18. The grants of representation were made, and the only issue with which the judge—His Honour Mr Justice Blackburn, in the first instance—had to concern himself was the entitlement of T to the estates. It was accepted at the trial that the son, R, was disqualified from benefiting from his parents’ estate under the principle of public policy enunciated in a number of cases, the leading case being the 1892 case of Cleaver v. Mutual Reserve Fund Life Association.

As Mr S died intestate, the devolution of his estate fell to be determined in accordance with the provisions of sections 46 and 47 of the Administration of Estates Act 1925. Section 46(1)(ii) states:

“If the estate leaves issue but no husband or wife the residuary estate of the intestate shall be held on the statutory trusts for the issue of the intestate”.

When Mr S died, he left issue in his son, RS, and his grandson, T. With RS ruled out because of the forfeiture rule, the question was whether the grandson could inherit. I cannot put it more succinctly than the trial judge, who said:

“The plaintiff’s entitlement arises, if at all, under the statutory trusts set out in section 47(1)(i).

Under the terms of that provision, however, the plaintiff, as the son a child of the intestate, can qualify only if he is within the definition of: ‘issue living at the death of the intestate who attain the age of eighteen years or marry under that age of the intestate who predeceases the intestate’.

On its face therefore, section 47(1)(i) requires:

(a) that as issue of a child of the intestate, the plaintiff should

(i) be living at the death of the intestate”—

which of course T was—

“(ii) attain the age of 18 or marry under that age”—

although that was not yet achieved, the grandson might have gone on to do so—

“(b) that his father, RS, being a child of the intestate, should have predeceased the intestate”—

which was not the case. The judge concluded:

“Literally applied, therefore, the plaintiff cannot satisfy the conditions laid down for him to take.”

The counsel instructed to represent T, Mr Barlow, submitted that the crucial section 47(1)(i) should be construed as though RS had predeceased his father. Not surprisingly, the judge rejected that submission:

“Persuasively though the argument was put, and sympathetic though I am to the plaintiff’s plight, I cannot accept Mr Barlow’s submissions. In my view the relevant authorities do not justify such an approach. If anything they assume that as happened of course, the offender must indeed be taken to have survived his victim.”

It was then necessary to determine whether Winifred’s executors—the House will recall that Winifred was the murdered man’s sister—should inherit. The difficulty was that, if her estate was to benefit, compliance with section 46(1)(v) was required. That provision requires the intestate to have died without husband or wife, or issue or parent. However, there was issue, because both the son, RS, and the grandson, T, had survived. There were two possibilities for the court to consider.

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First, as the conditions set out in subsection(1)(v) had not been satisfied, Winifred’s estate could not take, in which case, the estate of Mr S would pass to the Crown as bona vacantia. In view of the current state of the public finances, some people in the Treasury may well think that there ought to be more cases in which the Treasury stands to benefit, but that was not a matter that the court took into account. Secondly, notwithstanding the non-satisfaction of the conditions required for the operation of that subsection, the next available class could nevertheless take, where a person from an earlier class, although in existence, is disabled from taking.

Although it appears from the situation that prompted those questions that Winifred’s estate was entitled, it was not one that, according to the research undertaken by counsel, had been the subject of a decision in any previous reported case. The question had arisen—and had been considered in the context of a disclaimer, rather than in the application of the forfeiture rule—in the case Re Scott (deceased) and Widdows v. friends of the Clergy Corporation in 1975. I do not propose to go into the facts this morning; suffice it to say that the decision in that case was that if one class of potential beneficiaries had disclaimed, and there were no members in subsequent classes, that did not prevent members of a class with a lower entitlement from inheriting.

Mr Knight: My hon. Friend is dealing with two important cases, but does he agree that they illustrate that our intestacy provisions are defective, and that the Bill seeks to put that right? The intestacy rules are a default mechanism, designed to help people who did not make a will, by channelling their property to their nearest blood relatives. Those cases show that there is a defect in that mechanism that is enabling further, distant relatives to benefit in those narrow cases, which is something that the Bill seeks to put right.

Mr Nuttall: My right hon. Friend is absolutely right. Reading in even more detail the transcripts of those judgments, it was clear to me that the judges, certainly at first instance and again in the Court of Appeal, struggled with that dilemma, because they knew that in cases of intestate succession the will of Parliament was that the closest issue to the deceased should inherit, whereas the operation of this rule meant that more distant relatives were taking. In the case of DWS, they concluded reluctantly that, with the best will in the world, they could not override the wording of the 1925 Act.

The judge decided that the case provided a common-sense if not entirely logical answer to the problem arising from RS’s disqualification from benefit. The Treasury was not represented in that case and decided that it would not even appear, so I think that the judge was looking for a way to ensure that at least someone in the family benefited, which is why he seized on the case of Scott as a way out. He stated that, if necessary—and he did not think that it was—the same result could be achieved by implying that the words “capable of taking” were added after the words “no issue’” in section 46(1)(v). The inclusion of those words was another way around the problem.

When I read the details of all the cases, it seemed rather odd that the judge was prepared in effect to add the words “capable of taking” into an Act. However,

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when it came to the previous rule, there was no way round it. Had he not made that decision, and found a way to get round the forfeiture rule, perhaps we would not be here today and there would be no need for the Bill. As a result of that approach, the estate of Mr S did not pass to the Crown as bona vacantia, but to Winifred’s executors.

That, of course, all led on from a murder in 1993. The case began in 1995 and reached the Chancery Division at Newcastle-upon-Tyne in March 1999. The decision was appealed on behalf of the grandson and the case went to the Court of Appeal in November 2000. Three years later, in July 2003, the Department for Constitutional Affairs asked the Law Commission to review the relationship between the forfeiture rule and the law of succession. In particular, the terms of reference specified that the review should be carried out with reference to the difficulties highlighted in the case Re DWS (deceased).

Mr Knight: Will my hon. Friend confirm that there was no suggestion as all in the case Re DWS that the grandchild had in any way aided and abetted the murder? He was an innocent potential beneficiary who lost out. Indeed, I believe that at the time of the murders the grandchild was only two years of age.

Mr Nuttall: I was not aware of the precise age of the grandchild, only that he was a young minor. I apologise: the preamble to the law report does state that RS had a two-year-old son, so it is fair to say that at that age he was entirely innocent. His mother, as I mentioned earlier, was acting on his behalf to ensure that he would not suffer as a result of the acts of his murderous father.

The Law Commission embarked on an investigation of the matter. It was asked to explore ways in which the law might be reformed to prevent the apparently unfair outcomes of the sort that occurred in that particular case. In October 2003, the Law Commission published a consultation paper entitled “The Forfeiture Rule and the Law of Succession”. It was in July 2005—another two years having passed—that the commission published its report. We can see how the years passed—it was 10 years since the start of the case and 12 years since the original murder.

In the introduction to its report, the Law Commission stated:

“It is clearly right to exclude a murderer from inheriting, but it seems unfair to exclude the murderer’s children as well. This outcome appears arbitrary: it is not based on public policy, but it is a by-product of the way the intestacy legislation is drafted.”

The Law Commission’s recommendations in its report of July 2005 were, first, that there should be a statutory rule that when a person forfeits the right to inherit from an intestate through having killed that intestate, the rules of intestate succession as laid down in sections 46 and 47 of the Administration of Estates Act 1925, as amended, should be applied as though the killer had died immediately before the intestate.

The Law Commission recommended, secondly, that when a person forfeits a benefit under an intestacy through having killed the deceased, but as a result of the reforms property devolves on or is held for a minor descendant of the killer, the court should have the power to order that the property be held by the Public Trustee, who should administer it so as to avoid benefit to the killer. Thirdly, when a person forfeits a benefit

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under a will through having killed the testator, the will should be applied as though the killer had died immediately before the testator unless the will contains a provision to the contrary.

The fourth recommendation was that where a person forfeits a benefit under a will through having killed the deceased, but as a result of the reforms property devolves on or is held for a minor descendant of the killer, the court should have power to order that the property be held by the Public Trustee, who should administer it so as to avoid benefit to the killer. Fifthly, when a person disclaims an inheritance either under a will or under the law of intestacy, the inheritance should devolve as if the person disclaiming had died immediately before the deceased. The sixth and final recommendation was that when a person loses a benefit under intestacy by dying unmarried and a minor but leaves children or remoter issue, the property should devolve as if that person had died immediately before the intestate.

The following year, in 2006, the then Labour Government accepted the Law Commission’s recommendations and included the provisions to implement them in part 3 of a draft civil law reform Bill which they put out for consultation in December 2009. Seven of the eight respondents to part 3 of the consultation on the Bill supported the reforms and agreed that the new law would be fairer and simpler to operate.

Lyn Brown (West Ham) (Lab): I have been listening with rapt attention to this modern-day “Bleak House”, although I am sure the hon. Gentleman will agree that the prose is not quite as eloquent as that of Charles Dickens. Given that the Bill proposes a remedy to the particular difficulties that the hon. Gentleman has highlighted in the cases that he has placed before us, is he not prepared to accept the Bill and allow it fair passage through to its Report stage?

Mr Nuttall: I certainly wish the Bill well. I am about to express my concern at how long it has been held up in the legislative process. The report from the Justice Committee referred to that.

Jacob Rees-Mogg (North East Somerset) (Con): I am loth to disagree with the hon. Member for West Ham (Lyn Brown), who always makes fine points, but on this occasion may I encourage my hon. Friend to give us a full explanation so that we can thoroughly understand why the Bill is necessary? Legislation is a big and weighty matter and should be brought in only for major issues where there is real concern. We need to understand that, and I am grateful for the fullness of my hon. Friend’s explanation, which I hope will be even fuller.

Mr Nuttall: I am extremely grateful to my hon. Friend for that intervention. The Bill would not be before the House had it not been for the original case. It raises the question how many other cases in solicitors’ offices throughout the land have been determined on the back of that Court of Appeal case without ever going to court because the solicitors would say, “We know what the law is because of the Court of Appeal ruling in that case.” Many cases may have been dealt with in that way.

It has now been 18 years since the murder, and 10 years since the judgment, which raises the question of how fast we have progressed with the matter.

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Mr Knight: As far as I can ascertain, having looked at the figures, the Bill will affect about 200 cases a year.

Mr Nuttall: I am grateful to my right hon. Friend for that helpful information. If we extrapolate from that, disregarding the fact that the legal proceedings took six years from their launch to their conclusion, we can calculate that in the past 10 years around 2,000 cases have been affected by the delay in bringing the matter to fruition.

My right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) referred to the evidence that Professor Beale gave to the Justice Committee when it prepared its sixth report, which was part of the pre-legislative scrutiny procedure for the draft Civil Law Reform Bill. Professor Beale had indicated the difficulties in implementing the Law Commission’s recommendations. With regard to limitation periods, one problem was that the delay had been so long that new cases had come along in the meantime and changed the legal position.

The Secretary of State for Justice at the time, the right hon. Member for Blackburn (Mr Straw), had accepted that there had been delays in implementing the Law Commission’s recommendations. He said that the draft Civil Law Reform Bill had “been in process” since he had been at the Ministry of Justice. He said:

“One of the difficulties… is that this is an important measure but there have always been other… demands on the legislative programme in the past which have meant that it has been squeezed out, because it is worthy—I actually think very important in terms of what it is doing—but it has not been seen as such a high priority.”

I am sure that those affected by that in the 2,000 cases would think that it is an extremely high priority. He continued:

“That is the honest trust about it… There has also been an extensive period of consultation.”

Well, he is certainly right there. He continued:

“The original proposals, for example, in respect of damages following fatal accidents, which were in the Law Commission proposals, have themselves been refined since then. But if you are saying: ‘Does that take 11 years?’, the answer to that is no.”

There are clearly problems with the procedures. If the case highlights anything—it is perhaps something that the House should look at—it is how the recommendations of the Law Commission are put into legislation. The Minister might have something to say on that later.

The Justice Committee did much pre-legislative scrutiny on that draft Bill and produced an excellent report on it, so it is interesting that the coalition Government have now announced that they do not intend to proceed with it. Were it not for the good fortune of the decision by my right hon. Friend the Member for East Yorkshire to adopt the Bill after his name was drawn in the ballot, I wonder how long the work of the Law Commission and the subsequent legislative scrutiny of the Justice Committee would have languished in the parliamentary waiting room.

If the Bill passes into law, the position would be clarified by virtue of the inclusion of proposed new section 46A, which provides that where a person is entitled to inherit on an intestacy but has either disclaimed their right or is precluded from inheriting by the forfeiture rule, that person is to be treated as having died immediately before the intestate. Clause 2 makes a similar provision to cover cases in which a person dies having left a will and a beneficiary under that will either disclaims or is

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precluded from inheriting by virtue of the forfeiture rule. Clause 3 provides that in the tragic case of a single parent under the age of 18 dying intestate and leaving a child or children surviving, the estate of the intestate—

Jacob Rees-Mogg: Would my hon. Friend explain a little more about the circumstances under which a testator could leave provision that would not be affected by the Bill? I have been unable to work out how a person who is murdered could have expected and anticipated that in their will. Would he elaborate on that point?

Mr Nuttall: My hon. Friend makes an excellent point. One of the problems is that the affairs of a person who is murdered are left hanging in mid air. If they have not made a will, their affairs might be left to the vagaries of the intestacy laws. If they have made a will and have been murdered by their son, law might provide for the estate to pass to that son anyway.

Mr Knight: My hon. Friend, like me, is a lawyer, so I hesitate to suggest this to him, but is not the answer to that question that any good will has a default position? If a testator gives to a son a share of the estate, which might be a 100% share, and that son then murders the testator, thus becoming prohibited from inheriting under the forfeiture rule, a good will would state that in the event that a son does not inherit, the estate should go to person A, B, C or whoever. Does my hon. Friend agree that a well-drafted will should cover that eventually? In my view, a will that does not do that and merely gives money to one person, without stating what will happen if that person cannot inherit, is an appallingly drafted will.

Mr Nuttall: My right hon. Friend is absolutely right, and I am sure that my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) has taken that comment on board. It was exactly the point I was about to make. I would add that I am sure that professionally drawn wills would, in the vast majority of cases, make further provision for substitution. As I know from experience, many wills are made at home—home-made wills—in which case people might not be so careful or think that it is even necessary to think beyond their nearest and dearest. They simply write their will at home, with two witnesses, and leave it at that. In such circumstances, if that person had an only child and that child murdered the testator, there would of course be nothing that the testator could do about it. However, if the person dies within a year of the act, it can still be classed as murder. The person might linger and still have appropriate testamentary mental capacity to make another will and change it. I could imagine those circumstances arising, although I accept that they would do so rarely.

Clause 3 provides that in the tragic case whereby a single parent under 18 years old dies leaving a child or children surviving, the estate of the intestate is distributed as if the single parent had died immediately before the intestate. That point was covered adequately in the comments of my right hon. Friend the Member for East Yorkshire.

My right hon. Friend thinks that the issue will affect 200 estates a year, but in future many thousands of estates will benefit from the proposals in the Bill. One

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thing is certain: many families will be for ever grateful that this measure was brought before Parliament. I certainly wish it well, I am pleased to see that Members on both sides of the House support it, and I trust that it will have the support of the whole House.

11.31 am

The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly): I, too, congratulate my right hon. Friend the Member for East Yorkshire (Mr Knight) on his success in last year’s ballot on private Members’ Bills and, indeed, on his good judgment in deciding to introduce the Bill before us. I am happy that he went for, as he put it, the worthy and uncontroversial option. Let us hope that that remains the case. It is uncontroversial but certainly not uncomplicated.

In presenting the Bill, my right hon. Friend was supported by the Chairman of the Justice Committee, my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith), who it is good to see here today, the hon. Members for Cardiff West (Kevin Brennan), and for Birmingham, Yardley (John Hemming), my hon. Friends the Members for Stone (Mr Cash), for South West Devon (Mr Streeter) and for Bridgwater and West Somerset (Mr Liddell-Grainger), the hon. Member for Rhondda (Chris Bryant), my hon. Friend the Member for Christchurch (Mr Chope), the hon. Member for Mansfield (Mr Meale), and my hon. Friends the Members for Croydon South (Richard Ottaway) and for Shipley (Philip Davies)—a good cross-section of the House.

Today, we have thoroughly debated an unusual but important aspect of succession law, and we had strong contributions—from my right hon. Friend the Member for Berwick-upon-Tweed, my hon. Friends the Members for Christchurch and for North East Somerset (Jacob Rees-Mogg), and the lawyer’s eye of my hon. Friend the Member for Bury North (Mr Nuttall)—that brought out many of the complexities of the succession law, even though the principle seems relatively straightforward.

My right hon. Friend’s Bill, as has been mentioned, will implement the main recommendations of the Law Commission in its 2005 report, “The Forfeiture Rule and the Law of Succession”, making the law of succession simpler and fairer. The purpose of the law of succession in this context is to decide who should get what from the estate of a deceased person. The Law Commission reached its conclusions after a public consultation in 2003, and its recommendations were accepted by the then Government in November 2006, subject to minor modifications. Those proposals were then included in the draft Civil Law Reform Bill, which was published for public consultation and pre-legislative scrutiny in December 2009. The pre-legislative scrutiny was conducted by the Justice Committee, which published its conclusions in its sixth report of the 2009-2010 Session of the previous Parliament, under the title “Draft Civil Law Reform Bill: Pre-legislative Scrutiny”.

Before the previous Government could reply to the Justice Committee, the general election was called. We all know the events that followed, but for the purposes of our debate today what matters is that my right hon. Friend was returned as the Member for his newly formed constituency of East Yorkshire. When the ballot for private Members’ Bills was subsequently held, he was fortunate enough to draw 20th place.

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Mr Nuttall: I think that, in fact, my right hon. Friend was a little more successful: he was drawn fifth.

Mr Djanogly: I am very grateful for being put right on that point, so fifth place it was. My right hon. Friend could no doubt have chosen any one of numerous topics from his own extensive experience without consulting anyone, and I am sure that it would have been a topic well worth debating and, perhaps, legislating on. Instead, however, he decided to consult the Law Commission and ask whether any of its recommendations, as he said earlier, were suitable for a private Member’s Bill and unimplemented. Those discussions led him to the commission’s draft law reform (succession) Bill, which was published in the Commission’s 2005 report, “The Forfeiture Rule and the Law of Succession”.

The provisions of that draft Bill had, by the time my right hon. Friend was considering what to do with his place in the ballot, been published with minor modifications as part 3 of the draft Civil Law Reform Bill. Those provisions, which my right hon. Friend adjusted in the light of the response to the distribution of estates provision in the draft Civil Law Reform Bill, form the basis of the Bill that we are debating today.

As the Minister responsible for the general law of succession in England and Wales, and as a Minister in the Department that sponsors the Law Commission, I am doubly pleased to be able to announce the Government’s support for this Bill on the law of succession; and I was pleased to hear from the hon. Member for Stoke-on-Trent South (Robert Flello) that the Opposition support the Government’s position in that context.

My hon. Friend the Member for Christchurch asked why the commencement date is not three months after Royal Assent, and the simple answer is that that is to allow the professionals and others to prepare for commencement: there will be wills to be re-looked at and so forth. Before considering the substance of the Bill, I should like to record the Government’s thanks to the Law Commission for its work on the forfeiture rule and the law of succession.

Law Commission Bills are by their nature likely, legally speaking, to be very technical, and this Bill is no exception. There is more to a law reform Bill than technical accomplishment, however; we have to be sure that it delivers the desired policy outcome effectively and efficiently. In that respect, the Bill has the additional advantage of having already in effect been carefully scrutinised by the Justice Committee. I know that my right hon. Friend the Member for East Yorkshire has paid careful attention to the Committee’s conclusions, and I thank my right hon. Friend the Member for Berwick-upon-Tweed, who as Chairman of the Justice Committee considered the draft Civil Law Reform Bill and, I am delighted to say, has returned to that role in the current Session. I am also grateful to the other hon. Members who served on that Committee with him when they scrutinised the draft Civil Law Reform Bill.

My right hon. Friend the Member for Berwick-upon-Tweed, the hon. Member for Stoke-on-Trent South and my hon. Friend the Member for Bury North asked in different ways about the Law Commission’s wider Bill and the Government’s attitude to the commission. The Government are committed to ensuring that the law is modern, simple and accessible, and we hold the

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commission’s work in high regard. I am confident that the measures flowing from the Law Commission Act 2009, both the protocol and the duty to report annually to Parliament, along with the new House of Lords procedure for Law Commission Bills, will help to improve the implementation rate of commission proposals. A higher rate of implementation will help to ensure more effective and accessible law, delivering better value for money as valuable Law Commission work is put to good use.

Five reports have been implemented or received Royal Assent over the past year: those on the rules against perpetuities and excessive accumulations, third parties’ rights against insurers, trustee exemption clauses, on reforming bribery and parts of its murder, manslaughter and infanticide reports.

My hon. Friend the Member for Bury North also asked what we are doing about the wider Civil Law Reform Bill issues. Decisions not to take forward the Law Commission’s excellent work are always difficult, and they are not taken lightly. It is a difficult time at the moment, and the Government have to be realistic about what they can achieve when there are other pressing priorities and a reduction in resources.

A great deal of the Law Commission’s work requires primary legislation to implement it, and it is very difficult at present to secure parliamentary time for legislation that is not a high priority or that does not deliver significant financial savings. Deciding not to take forward the proposal in the Law Commission’s reports on damages, personal injury, medical, nursing and other expenses, claims for wrongful death and pre-judgment interest on debts and damages, was not easy. However, in the current financial climate we need to focus our resources on delivering key priorities.

Having said that, I think that the new protocol on best practice between the Government and the Law Commission, agreed in March last year, should help. The protocol aims to ensure that the Law Commission takes forward only projects to which Departments are fully committed; that there is a close working relationship during the project; that the Law Commission produces impact assessments looking at the costs and benefits of proposals; and that Departments respond quickly once the Law Commission reports.

The Law Commission will soon be putting forward proposals for its 11th programme of work. That will be the first programme agreed in the light of the new protocol, and I am confident that it will assist in reducing delays both in responding to the Law Commission when proposals are accepted and in implementing them.

However, neither the Law Commission nor the Justice Committee could function as effectively as they do without the support of those who respond to consultations and calls for evidence. The experts who give freely of their time and experience are perhaps the unsung heroes of law reform work. It is invidious to single out organisations or individuals, but I note that the Law Society and the Bar Council replied not only to the Law Commission’s 2003 consultation and the Ministry of Justice’s 2009 consultation, but gave evidence to the Justice Committee in 2010.

I would like to thank all those who have replied to the Law Commission, the Committee and my own Department over the years. Unsurprisingly, the Bill does not reflect

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all their views, but I can assure them that their comments were all carefully considered and taken into account. I am confident that this Bill would command the support of the overwhelming majority of them.

I will now explain why the Government are supporting this Bill. Obviously, we are pleased that the Bill represents a return on the investment of public money in the Law Commission. The Government are committed to ensuring that the law is modern, simple and accessible. Usually, and properly, it is the Government who introduce Law Commission Bills; there is, however, no reason at all why the introduction of Law Commission Bills should be the preserve of the Government alone. Indeed, I would encourage hon. Members who in future years find themselves well placed in the ballot for private Members’ Bills to consider whether they might imitate the example of my right hon. Friend and discuss with the Law Commission whether any of its Bills might be suitable for debate. My right hon. Friend has set a very good example, and I thank him for that.

However, more fundamentally, the Government support this Bill because it will make the law fairer. To understand what is wrong with the law, it is necessary to go back to 1994 when a certain individual was convicted of the murder of both his parents; various hon. Members have referred to the incident. He was described in the press as an “evil conman” and

“a grasping son who repaid his parents’ lifelong devotion by bludgeoning them to death”.

He duly received two life sentences, but it is not the monstrosity of his crimes that underlie the Bill before us today—rather, it is what happened to his parents’ property, which was apparently worth more than £1 million and highlighted the problem with the law.

Apparently, the killer’s parents had made clear to their son that they would not provide for him on their deaths; they would provide only for his young son, their grandchild. To go back to the point made by my hon. Friend the Member for North East Somerset, if only they had made clear wills in favour of the grandchild, their apparent wish to support him would have been accomplished. However, no wills were found and their property was distributed according to the statutory intestacy rules.

Mr Denis MacShane (Rotherham) (Lab): On a point of order, Mr Deputy Speaker. We are being informed by television that Mr Andy Coulson, one of the most important figures in Her Majesty’s Government and one of the Prime Minister’s closest aides, is now resigning. As the House is sitting, I believe that it would be appropriate for the Prime Minister to come to the Commons, explain why that is happening and give the public the full details here in the House of Commons, rather than burying the news on a day when, frankly, an awful lot of other news is taking place. This is the Commons, where the Prime Minister should—

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. That is not a point of order, as the right hon. Gentleman, who has long been a Member of the House, knows. The fact that a member of the Prime Minister’s staff has resigned has nothing to do with the House.

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Mr Knight: Further to that point of order, Mr Deputy Speaker. Perhaps you could reflect again on the point just made and perhaps we could have a joint statement, also including the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), who also disappeared—

Mr Deputy Speaker: Order. Before we get carried away, I should say that that has absolutely nothing to do with the House. Neither of the points made is a point of order.

Mr Djanogly: I am delighted to pull the House back to the important issue of succession.

I was just saying that the property of the killer’s parents was distributed according to the statutory intestacy rules. The intestacy rules are a default regime; they apply where a person has not exercised his or her right to make a will or to the extent that his or her will is not valid. Their aim is to safeguard the deceased person’s family by providing for them from the deceased person’s estate in a manner that is thought to mirror the wishes of the average person had he or she made a will.

Generally speaking, an intestate estate will pass to the surviving spouse or civil partner and the deceased’s children first, but if the deceased is not survived by either of them, then other blood relatives of the deceased will inherit the estate in a strict order of priority set out in section 46 of the Administration of Estates Act 1925, as amended. I am not going to read out the rules, but if any hon. Members wishes to know more about them, I shall provide the information.

When there are no known eligible blood relatives to inherit, the estate is dealt with by the Treasury solicitor. On receiving the estate, the Treasury solicitor will make full inquiries into the estate and will advertise for eligible kin in the hope of distributing the estate. If there appear to be no eligible kin, or none can be traced, the estate becomes “bona vacantia” which means “ownerless goods” and it will pass to the Crown, the Duchy of Cornwall or the Duchy of Lancaster, depending on where in England or Wales the deceased lived.

When a minor inherits on intestacy, the property to which they will be entitled is held on trust. The terms of that trust are specified in the intestacy rules. Basically, the trustees will hold the property for the benefit of the child until he or she reaches the age of 18 or marries or enters a civil partnership under that age.

All that may seem relatively straightforward, and hon. Members could be forgiven for thinking that the grandchild in the DWS case would have inherited their property on reaching the age of 18, or marrying or forming a civil partnership before then, but there is a devil in the detail and, sadly, there was a family dispute that led to litigation. That culminated in the decision of the Court of Appeal in 2000 in the case of Re DWS (Deceased). By that time, it was agreed that the son himself could not inherit because, as he had murdered his parents, the forfeiture rule prevented it. The forfeiture rule is a common law rule, applying the general rule of public policy that a person is not able to benefit from their wrongdoing. It is illustrated by the 1892 case of Cleaver v. Mutual Reserve Fund Life Association, when it was held that a person is not entitled to benefit from the estate of a person he or she has unlawfully killed.

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A person who is convicted of the unlawful killing of another, or of aiding, abetting or counselling another to do so, is automatically disqualified from inheriting from his or her victim under the forfeiture rule. However, persons convicted of manslaughter or other offences less serious than murder may still be permitted relief to inherit the victim’s property by the court under the Forfeiture Act 1982.

The question for the court in Re DWS (deceased) was who would receive the grandfather’s property. Had the son died before his father, the property would have gone to the son’s only child, who was aged only two at the time of the murder and was also the grandfather’s only grandchild. However, the son—that is, the killer—was not dead, but merely disqualified from inheriting because of the operation of the forfeiture rule.

The relevant provision of the intestacy rules setting out the statutory trusts contained in the Administration of Estates Act 1925 provides that the grandchild will inherit only if his or her parent has already died. The court accordingly decided that the law did not allow the grandson to take the property. Instead, it was decided that the property would have to go to the estate of the dead grandfather’s sister, who had also died by the time of the court case. Thus, in this situation, not only is the killer disqualified from inheriting, but so also are all the killer’s direct descendants. The Court of Appeal expressed concern that this may have been an unforeseen and unintended consequence of the present intestacy rules.

In July 2003, the then Department for Constitutional Affairs, whose responsibilities in this regard have been assumed by the Ministry of Justice, asked the Law Commission to review the relationship between the forfeiture rule and the law of succession. The terms of reference were as follows: first, that in conjunction with its work on illegal transactions, the Law Commission should review the relationship between the forfeiture and intestacy rules; secondly, that the review should be carried out with reference to the difficulties highlighted in the case of Re DWS (deceased) and should explore ways the law might be reformed to prevent apparently unfair outcomes of this sort; and, thirdly, that the review should also consider any ancillary areas of succession law that might produce analogous outcomes—for example, disclaimer and attesting beneficiaries.

In October 2003, the Law Commission published a consultation paper, “The Forfeiture Rule and the Law of Succession”, which considered the problem raised in Re DWS, and discussed whether a similar problem arose in other contexts. The consultation paper provisionally proposed that in cases such as Re DWS there should be a “deemed predecease” solution—that is, where a person forfeits a benefit on intestacy through having killed the deceased, the estate should be distributed as if the killer had died immediately before the deceased. The Law Commission also proposed that the deemed predecease rule should apply where a gift under a will fails because of the forfeiture rule.

Sir Alan Beith: It is perhaps worth placing on the record—the Committee specifically sought to inquire into this—that the deemed predeceased rule has no other legal effect. In other words, determining that someone is deceased for the purposes of inheritance does not affect any other legal provision or right relating to them.

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Mr Djanogly: I thank my right hon. Friend for setting out that important point. If that were not the case, it could have serious knock-on effects for other cases.

The Law Commission received responses to the consultation paper from 31 individuals and organisations. Those included leading academics in the field of succession law; the Society of Legal Scholars, Property and Trusts Section; a number of individual judges, including Lord Justice Sedley, one of the members of the Court of Appeal who had heard the Re DWS case, whose response wholeheartedly endorsed the Law Commission’s proposed solution; the Association of District Judges; specialist solicitors from leading firms; the Inland Revenue; the Bar Council; the Law Society; and the Chancery Bar Association. Most of the respondents agreed that the current law was unsatisfactory, that in Re DWS (deceased) the grandchild ought to have inherited, and that a “deemed predecease” rule would be the best way of achieving this.

The Chancery Bar Association must, however, be singled out for particular mention. It spotted that there was an analogous, albeit rare, circumstance, elsewhere in the law of intestacy, that should be addressed. This arises from the fact that where a child inherits from a parent or other relative on intestacy, that child’s interest is held “contingently” on the statutory trusts under the intestacy rules.

In July 2005, the Law Commission’s final report, “The Forfeiture Rule and the Law of Succession” was presented to Parliament. The report recommended that a “deemed predecease” solution should apply in three situations. First, where a person disclaims or forfeits the right to inherit from a person who has died intestate, the intestacy rules should then be applied as if the killer had died immediately before the intestate. Secondly, where a person disclaims or forfeits a benefit under a will, the will should be applied as if the killer had died immediately before the testator, unless the will contains a provision to the contrary. Thirdly, where a person loses a benefit under an intestacy by dying unmarried and a minor, but leaves children, the property should devolve as if that person had died immediately before the intestate. The Civil Law Reform Bill incorporated provisions to this effect, subject to minor modifications relating to the role of the public trustee, which for reasons I shall explain, need not concern us now.

I hope this explanation of the genesis of this Bill makes clear the problems that it is trying to address. The overall point is that in the three circumstances identified— forfeiture, disclaimer and the rights of the children of a minor heir on intestacy—the detail of the law does not produce the desired result. The general policy on intestacy is that once the interest of any spouse or civil partner has been satisfied, the property of the deceased should pass to closer blood relatives before more distant ones: the children of the deceased, for example, should be preferred to siblings of the deceased.

Where there is a valid will, the general policy of the law is that the wishes of the testator—the person who made the will—should determine who is to inherit what from the estate of the deceased. That gives effect to the principle of freedom of testamentary disposition, which lies at the heart of our succession law in England and Wales, and which was referred to by my right hon. Friend the Member for East Yorkshire and others.

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The effect of the Bill will therefore be to change the law in the three areas mentioned, so that it is consistent with the general policy of the law. First, as was highlighted in the 2001 Court of Appeal decision in Re DWS (deceased), where a person forfeits an inheritance on intestacy because he or she has killed the person from whom he or she would have inherited, his or her children will also be disinherited. The forfeiture rule thereby disinherits not only the criminal but also the innocent grandchildren of the victim.

This problem is not confined to intestacy. For example, where there is a will that contains a gift specifying who is to inherit, if the first named recipient dies before the testator and that recipient forfeits his or her inheritance, the default gift cannot take effect because the recipient is still alive. Similarly, if there is a will giving a gift to a child of the testator without any further provision, the law implies a term that the gift will pass to his or her children if he or she predeceases the testator. If the testator’s child forfeits his inheritance, his or her children—the testator’s grandchildren—will not be able to inherit.

The same problem arises in both testate and intestate successions where the person who would be first entitled disclaims the inheritance. Anyone claiming through him or her will not be able to inherit. Let me explain the term “disclaimer” here, as that was raised by my right hon. Friend the Member for East Yorkshire, and discussed further by my hon. Friends the Members for Christchurch and for North East Somerset in the context of disclaiming gifts under a will. There was a further question as to why this needed to be done.

A beneficiary is free to accept or disclaim—that is, refuse—a gift that has been left to him or her in a will. The unwanted gift will form part of the testator’s residuary estate—the part of the estate remaining when all the specific gifts have been satisfied— unless, as is less usual, he or she has made a default gift in the event of a disclaimer. If the will does not make provision for the disposal of the estate, it will be distributed according to the intestacy rules.

My hon. Friend the Member for Christchurch went on to ask why that should be the case. Figures are not kept on the number of people who disclaim gifts in wills. However, in its consultation paper, “The Forfeiture Rule and the Law of Succession”—CP No. 172—the Law Commission commented that the usual reasons for disclaimer in will cases will either be to secure beneficial tax consequences or to enable the beneficiary to avoid inheriting onerous property such as a lease with repairing covenants. My hon. Friend then asked whether the disclaimer provision opens the way to evade inheritance tax. The answer is no, because in the example we have before us, the son could achieve the same results as a disclaimer under the Bill by varying the will or the intestacy rules. Deeds of variation can be used to vary the distribution of the estate for inheritance tax or capital gains tax purposes. That is only possible where all the original beneficiaries agree and the tax legislation permits it. These variations will often include disclaimers by some or all of the original beneficiaries, and the Bill simply enables the intended recipient to disclaim without thereby disinheriting anyone entitled to claim through him or her.

My hon. Friend the Member for North East Somerset then asked whether a disclaimer of inheritance can instead take the money and give it away. The answer is

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yes; the money would then be his or hers to do with as he or she wished, but he or she could not disclaim part of an inheritance, or having disclaimed, specify where the inheritance should go. That is for the deceased to say in a will or the intestacy rules, which act as a deemed will, if I can put it in those terms. So a beneficiary of an intestate estate is free to accept or disclaim the inheritance. When the disclaimer is a child of the deceased, the disclaimed interests passes to the child’s siblings. Clauses 1 and 2 of the Bill address those issues.

There is the rather unusual situation, which was spotted by the Chancery Bar Association—I take my hat off to the assiduous lawyer who noticed this one—in which if a person under the age of eighteen who is prospectively entitled to inherit property under the intestacy rules, perhaps from his or her parent, dies before reaching the age of majority, leaving children but without having married or entered a civil partnership, those children cannot inherit in place of their parent. Right hon. and hon. Members used several interesting possibilities to explain how that could be put into practice, but that happens because the parent did not reach the age of majority or marry or form a civil partnership under that age. In more legal language, the parent did not attain a vested interest. That anomalous outcome, rare as it might be, discriminates against those children.

Clause 3 addresses that issue. In all three cases, the Bill would solve the problems by deeming the person who loses the inheritance to have died before the person whose estate is being distributed. That means that on intestacy, the children of the person losing out will be able to inherit under the statutory intestacy rules and, if there is a will, that the actual or deemed wishes of the testator will prevail. In short, the aim of the Bill is to try to ensure that the “right” people inherit. The Government support that aim.

I shall comment on the differences between the Law Commission’s draft Bill, published in 2005, and the equivalent provisions in the draft Civil Law Reform Bill, published in 2009. These issues were raised by my right hon. Friend the Member for Berwick-upon-Tweed, and my hon. Friend the Member for Christchurch touched on them, too. They largely derive from the comments of the Justice Committee and the people who gave evidence to it. Some of the changes are drafting changes, but others were more significant. The question arises of why they should have been left out of the Bill.

Although the Justice Committee welcomed the proposal to ensure that minors who inherit under the provision have their inheritance protected, several criticisms were made of the special trust advice chosen by the Law Commission to achieve that aim. On consideration of the responses to the consultation and the evidence to the Justice Committee, it has become clear that the special trust was unnecessary and would be problematic and expensive to operate. The existing law, which already imposes a trust and gives the court power to appoint alternative trustees and supervise those trusts, gives the property of minors adequate protection. We therefore believe that the Bill meets the concerns of the Justice Committee in that regard.

The Justice Committee welcomed the reforms and reached two conclusions. First, it stated:

“We welcome this clause as ending the current rule which penalises the children or other heirs of a killer who are themselves not only entirely innocent but are the people whom the deceased

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would probably have wanted to benefit from the estate in any event. We also welcome the proposal to ensure that minors who inherit under this provision have their inheritance protected.”

Secondly, it pointed out:

“We recommend the Government to re-examine the drafting of clauses 15 to 17 in the light of the comments made by the Bar Council and the Law Society. We expect all minors to receive suitable protection under the bill. Equally, we share the Law Society’s concern that nothing be done to impair the validity of existing wills.”

The main difference, however, as my right hon. Friend the Member for Berwick-upon-Tweed pointed out, is that the earlier draft Bills contained specific provisions intended to ensure that in forfeiture cases the criminal was prevented from gaining any benefit from the inheritance that would, under the terms of the draft Bill, pass to his or her children. Those special trust provisions attracted a good deal of criticism from witnesses to the Justice Committee and people who replied to the Ministry of Justice’s consultation on the draft Civil Law Reform Bill.

Two respondents—the Law Society and the Bar—considered that the safeguard provisions were not necessary because legislation already exists that would protect an infant beneficiary’s inheritance in forfeiture cases if such protection were to be needed. Both referred to section 116 of the Senior Courts Act 1981, which provides the court with discretion to pass over any prior claims to a grant and appoint someone else if by reason of any special circumstances it appears necessary or expedient to do so.

The Bar also mentioned section 114(2) of the 1981 Act, which provides that wherever a minority interest arises under a will or on intestacy, a grant should be made to a trust corporation or to two individuals, unless it appears to the court to be expedient that there should be a sole personal representative.

The same two respondents also expressed concern about the limited application of the safeguard provisions, which is restricted to the infant children or more remote issue of the offender, and only then if, as the Bar noted, the infant inherits by virtue of the reform rather than under, for example, a default gift in a will. It considered that there may be cases where court intervention is needed to prevent potential abuse of the inheritance, where those inheriting are infants but are not directly related to the offender.

The Bar also objected to the width of the power of the court to allocate any property in which the infant had an interest to the trust, and it raised a fundamental concern about the workability of the provisions, where both the infant and the disqualified person would inevitably benefit from the trust property—for example, where the former matrimonial home was held under the trust, and the infant and the disqualified person were both living there.

The Bar concluded:

“On balance, we consider the provision”

to safeguard an infant after forfeiture

“to be unhelpful, and likely to lead to increased expense in the administration of estates in circumstances which are bound to be tragic but are otherwise unpredictable.”

The Government have given particularly careful consideration to those comments, which we have discussed with the Law Commission and with Master Winegarten

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of the chancery division of the High Court, who was very critical of the special trust provisions. We agree with the Justice Committee that minors who inherit should have their inheritance protected and that all minors should have suitable protection under the Bill. However, it is clear from our more detailed consideration of how the special trust provisions would work that they are unnecessary, problematic and expensive to operate.

As my right hon. Friend the Member for Berwick-upon-Tweed pointed out, the Civil Law Reform Bill contained special trust provisions for children. He asked whether this Bill provides protection now that the special trust provisions have been taken out, an issue which I have dealt with. In our view, the existing law, which already imposes a trust to the benefit of minor children and gives the court power to supervise the administration of estates, gives effective and adequate protection.

Sir Alan Beith: My hon. Friend is giving a detailed analysis and providing fairly compelling reasons why the specific provisions involve many problems. However, it is not only the protection of the minor’s inheritance that is at stake, but the maintenance of the principle that the person who has carried out the murder should not benefit from that murder, which might happen indirectly.

Mr Djanogly: I take my right hon. Friend’s point. As we have discussed, I agree that there is the technical possibility of the murderer taking advantage, but it is far fetched. Indeed, my right hon. Friend has mentioned that that assumes that the murderer had a solid knowledge of the laws of succession, which would include the certain knowledge that they would spend many years in prison. As my right hon. Friend the Member for East Yorkshire pointed out, the Bill does not affect the forfeiture rule. In the light of the responses to the consultations by the Law Commission and the Ministry of Justice and the pre-legislative scrutiny by the Justice Committee of all those proposals, we do not believe that allowing a killer’s children to inherit from the victim will encourage people to kill.

Sir Alan Beith: My hon. Friend has misunderstood my point, which does not concern the absurd issue of deterrence. Someone who has committed a murder—they may even be in prison—may be able to evade financial responsibilities as a result of the provisions. It is not far fetched that those who have committed murder would seek to gain some benefit from the money that would rightly pass to their children under such provisions.

Mr Djanogly: I thank my right hon. Friend for making that clear.

The Law Society also made an important point about the wording of the provisions in new section 33A(2) of the Wills Act 1837, which would be inserted by clause 2(1) of the Bill. Earlier draft Bills provided that where a person disclaims, or is disqualified by the operation of the forfeiture rule from inheriting under the deceased person’s will, the will is to be construed as if that person had died immediately before the deceased, save in so far as there is any provision in the will about how the devise or bequest is to take effect. The Law Society thought that this “any provision” test was more demanding than the “unless a contrary intention appears by the will”

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test in other related statutory provisions, and the Bill now follows those other provisions. We hope that will provide consistency and simplicity.

We welcome my right hon. Friend the Member for East Yorkshire’s decision to make the Bill consistent with the Wills Act and I should add, for completeness, that the Law Commission is content with the Bill in its present form. We are very grateful to the Justice Committee and its witnesses, particularly the Bar and the Law Society, for drawing attention to these matters. The approach in the Bill is the right one. This is a small but worthwhile piece of technical law reform produced by the Law Commission. I applaud my right hon. Friend for taking up this serious topic and I wish the Bill a fair passage through this House and the other place.

12.11 pm

Mr Knight: I shall be brief because I sense that the House now wants to hear from the hon. Member for Washington and Sunderland West (Mrs Hodgson).

I thank my ally, the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith), and I am grateful for his support and the work that his Committee has undertaken. I am also grateful to him for agreeing to be a co-sponsor of the Bill. On the point that is still exercising him a little, I understand that the court does have power to appoint two trustees to take over an estate where they are concerned about a killer benefiting and where a minority interest arises. I hope that provision is sufficient.

I thank the hon. Member for Stoke-on-Trent South (Robert Flello) for reciprocating today the support that I recently gave to him for his private Member’s Bill. My hon. Friend the Member for Bury North (Mr Nuttall) made a comprehensive and wide-ranging speech and I am grateful for his support, coming as it does from a former practising solicitor. The lesson that every member of the public should draw from the remarks of the Minister and my hon. Friend the Member for Bury North, and from all the cases associated with this area of law, is that it pays to make a well-drafted will. However, the Bill seeks to prevent injustice occurring where a well-drafted will is not in place. I thank the Minister, I am delighted to have the Government’s support and I endorse all his remarks.

I shall not detain the House any longer except to say that what I seek to do is introduce a deemed, predeceased rule which means that a person who has killed the deceased person, a person who disclaims the inheritance and a person who dies a single parent under the age of 18 are all deemed to have died immediately before the deceased. The Bill will make the law fairer by removing technicalities that run contrary to the general policy of the law of succession. This is a complex area of law; I do not expect any publicity from the media about this Second Reading debate, but that does not matter to me. What matters is that the proposal is just, modest and, above all, fair. I commend it to the House.

Question put and agreed to.

Bill accordingly read a Second time; to stand committed to a Public Bill Committee (Standing Order No. 63).

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Sale of Tickets (Sporting and Cultural Events) Bill

[Relevant documents: Second Report of the Select Committee on Culture, Media and Sport , Session 2007-08, on Ticket Touting, HC 202, and the Government response thereto, Cm 7436 .]

Second Reading

12.14 pm

Mrs Sharon Hodgson (Washington and Sunderland West) (Lab): I beg to move, that the Bill be now read a Second time.

The reason for my bringing forward the Bill should be obvious to hon. Members who have turned up today, even those who have done so perhaps only to oppose it. To demonstrate the problem, I will paraphrase from an article in The Times of 25 September 2010. At 8.50 am, Rachel Still switched on her computer and waited. At 9 am precisely, tickets for a gig by Brandon Flowers in London were to go on sale. A few minutes before 9, Rachel logged on to the ticket website and began the repetitive formula for buying tickets. At 9.1 am she was told that the gig had sold out. Her friends told her that they had received the same message at 8.57 am, before the tickets were even officially released. Within minutes those same tickets were appearing on secondary websites at prices way above the £25 face value, the cheapest one being £74. A survey showed that of the 2,300 tickets sold, 616 were instantly re-advertised—more than a quarter. No doubt there would be more to follow closer to the date too, as it is common practice to drip-feed more tickets on to the market at a sufficiently slow pace to keep the prices high.

That situation plays out time and again in homes up and down the country—ordinary fans trying in vain to get tickets, only to find that they have sold out within minutes. The disappointment is then compounded when they see that the touts do not have the same problems as they do in finding large numbers of tickets. I know all this because it has happened to me and to my teenage children, and I know we are not alone.

When I first tabled the Bill, after the private Member’s Bill ballot, the media attention prompted lots of people to write to me, expressing their support for action to tackle ticket touting. They ranged from academics to ordinary fans, and all had a story to tell. The story that stood out most prominently, though, was that—

Mr David Nuttall (Bury North) (Con): Will the hon. Lady give way?

Mrs Hodgson: Not at the moment. There will be plenty of chances for Government Members to speak. We have plenty of time, and I will give way when I have got further into the substance of my speech.

The story that stood out most prominently was that of a gentleman who used to work at a media event venue, which I will not name. He told me that it was common practice for the box office managers to cream off all the best seats to sell to touts at a mark-up of 50% before they even went on sale. Then, when the tills opened, they would simply put in the face value and issue a receipt for them all. I suspect security has improved since those days, but there is no doubt that

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the levels of reward on offer and the lack of regulation mean that many tickets never even reach the legitimate market at face value.

Even the big players in the secondary market recognise that, from the consumer’s perspective at least, there is a massive problem with this market. I quote Graham Burns, chairman of the Association of Secondary Ticket Agents, who said in a Sunday Times article in November:

“The ordinary fan is screwed. The decks are stacked against them. Try and buy a front-row seat at a bestselling concert at face value. It can’t be done.”

The aim of the Bill is to redress that balance—to give consumers back the power and to help event organisers choose how they want their tickets to be available and for how much.

While I initially approached the Bill from a fan’s perspective, I quickly got a better picture of the industry’s perspective as I met people who had got in touch about it, but I think the most strikingly unjustifiable part of the secondary market is the resale of charity tickets. Later in my speech I will go into some detail about the experience of the Teenage Cancer Trust, but I came across another, briefer example in The Sunday Times. Like the Minister’s boss, I too am a fan of some of Rupert Murdoch’s news output.

That example was the sale of Help for Heroes tickets. The gig was at Twickenham in September, and featured Robbie Williams, Gary Barlow and Tom Jones, who had freely given their time and names to support an incredibly worthy cause. Tickets for the event were being touted on secondary websites at an average of £106, despite the fact that the face value of an ordinary ticket was £46.75 and that the tickets clearly said on the back that they were not to be resold. The touts are earning more than the charity here, and if any hon. Member can convince me that that is right, I will happily withdraw my Bill and sit down.

Philip Davies (Shipley) (Con): I wonder who the hon. Lady sees as the victim. If a charity wants to sell tickets at £46 each and someone pays £46 each, the charity gets all the money that it expected to get. The fact that someone is prepared to pay more to someone else for that ticket does not take any money away from the charity. It still gets exactly the same amount as it bargained for when it sold the tickets. It makes no difference to its income whether the person who paid £46 for the ticket uses it or sells it on to someone else.

Mrs Hodgson: The charity does not get the whole £46. On average, with overheads and so on, charities reckon that they get about half the ticket money. The tout or whoever sells on the ticket, which clearly states on the back that it must not be resold, makes six or eight times more than the charity. The artists, who have given their time freely, intend that any money that comes on the back of their time and from the ticket should go to the charity. I find it quite shameful that the hon. Gentleman can say that such a practice is fair when the charity intends to help teenage victims of cancer. [ Interruption. ]

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. Hon. Members should work through the Chair, rather than talk across to each other.

Mrs Hodgson: Thank you, Mr Deputy Speaker.

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Jacob Rees-Mogg (North East Somerset) (Con): I thank the hon. Lady for being both gracious and generous in giving way a second time so quickly. If the charity fails to sell its tickets for the market price, which is £106, that is its fault. It ought to investigate other ways to sell its tickets, such as eBay, to maximise its return, rather than our introducing a harsh legislative measure.

Mrs Hodgson: The charity decides on the price based on the genuine, ordinary fans whom it wishes to attract. It is often aware that the price is sometimes below the market value, but the reason is that it does not want to attract only people who can afford to pay £106. It wants to attract a broad cross-section of people. It does not just want elite people in the audiences at such events. I will give further examples in due course.

Ian Austin (Dudley North) (Lab): Does my hon. Friend share my surprise that Government Members support a system that excludes their constituents from having access to a free and open market, in which they can compete with other people to have proper access to tickets? Why does she think that they are in favour of their constituents not being able to buy tickets when they first go on sale?

Mrs Hodgson: That is an interesting point. Government Members have a lot of good arguments on the free market, but with regard to charity tickets, none of those arguments hold up. They should want such access for all their constituents, not just the ones who can afford to pay premium prices.

Philip Davies: Will the hon. Lady give way?

Mrs Hodgson: I would like to move on. I have a long speech, and I would like to get through the details.

I am, of course, aware that the issue has been considered on a number of occasions over the past five years. To be honest, the fact that it has been revisited so many times is testament to the fact that those who look at it keep coming to the wrong conclusions. Although I have read some of the contributions to the Culture, Media and Sport Committee’s inquiry, I still cannot understand how it arrived at its conclusion. The Select Committee and the then Government both concluded that fans wanted a forum in which they could buy tickets closer to the date of an event or sell them if they could not make it. I absolutely agree with that statement, but I disagree that that conclusion should allow the secondary market to carry on unregulated.

The key thing that both the Government and the Select Committee missed is that consumers also want a fair chance to get tickets at face value, and they do not want to be ripped off. I have a quote from a letter that my right hon. Friend the Member for St Helens South and Whiston (Mr Woodward) sent in his capacity as the then Minister with responsibility for the creative industries in response to my hon. Friend the Member for Glasgow North West (John Robertson), who is not in his place today, when he was campaigning on the issue way back in 2007. My right hon. Friend said:

“While consumers want a secondary market, they do not want to be exploited by individuals or businesses at their personal expense.”

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But he then suggested that it was not in the public interest to legislate. I know my right hon. Friend the Member for St Helens South and Whiston; he is an intelligent man, so I can only think that once one becomes a Minister, there is sometimes a tendency to trust what the civil servants are saying a little too much.

Philip Davies: Will the hon. Lady give way?

Mrs Hodgson: No, I will not, if the hon. Gentleman does not mind.

Will the Minister tell us what his civil servants advised him ahead of this debate? I know my office provided them with advance sight of the Bill, so I hope they had enough time to come to a considered view. I look forward to hearing the Minister’s response—if his colleagues allow him to get in.

Coming back to the point, the Bill does not aim to do away with the secondary market. It aims to make the secondary market work in the interests of genuine fans, by forcing out the people who are there simply to profit from the hard work, investment and creative talent of the live entertainment industry, a sector that I am sure the Minister will agree has become extremely valuable to the UK’s economic vitality.

The role of the Government and of the House is to legislate in the public interest. The public interest does not lie in a few touts and the channels they sell through continuing to make obscene profits at the expense of the general event-going public and of the live entertainment industry. The public interest lies in the Government providing a statutory framework for the industry to use in the interests of fans where needed. That is exactly what the Bill provides for.

Before I come to the substance of the Bill and go through its various clauses, I take this opportunity to thank my fantastic and hard-working team who have helped me on my route to introducing the Bill to the House. In particular, I thank two people: Mike Forster, my researcher, who only started in August, so the Bill has been a huge part of his job; and David Hopper, previously my intern but now studying to be a solicitor, who did a lot of the groundwork behind the scenes on legislation around the world.

The Bill addresses the problem I laid out. It creates two new offences, but that is not the starting point. The starting point is the creation of a voluntary designation scheme under which those involved in putting on live entertainment events can apply for protection from the unauthorised resale of their tickets. If they apply for protection, it would be an offence for an unauthorised individual to be concerned in the sale of a ticket for that event at a price greater than 10% above face value. For such purposes, face value is the printed value plus any service charges levied by the appointed ticket agent.

Such an approach broadly follows that set out in the Queensland solution, of which hon. Members on the Select Committee on Culture, Media and Sport will be aware. In Queensland, tickets for any event held at certain major venues are subject to price caps on unauthorised resale. I want to broaden that provision out, because it would not touch a large part of the market, such as theatre or mid-sized and small gigs,

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which are just as lucrative for touts as stadium events—if not more so, because they occur on almost every night of the year in towns and cities throughout the country.

Clause 1 sets out how that system of designation could work. I am open to its refinement or to alternative suggestions from the Government or other hon. Members in Committee should the Bill be successfully voted through today.

Clause 2 sets out the offences, the first of which I have already mentioned. The second offence is the advertisement for sale and taking of payment for tickets that have not yet been released by the primary retailer. The issue is separate from that of the secondary market, coming as it does before even the primary market. Websites spring up offering concert tickets—a recent example is the Take That tour—that the person running the site obviously does not even have. It is a risk-free business, because the person gets a lump sum of cash to buy as many tickets as possible to satisfy the orders, and simply refunds any orders that cannot be satisfied. In some cases, such sites have simply not delivered the tickets and done a bunk with the money. Other laws cover such activities, but why is it still legal for those sites to offer tickets that they do not have, at the risk of many consumers being left short-changed and without tickets?

Clause 2 sets out the sanctions for the offences, which include a fine up to the level 5 limit on the standard scale. There was a case for going higher than that, as for many major operators, £5,000 represents a drop in the ocean of their business.

Lyn Brown (West Ham) (Lab): As my hon. Friend knows, I am particularly concerned about the issue of tickets touts and the Olympic games. I do not feel that £5,000 is enough of a fine to deter unscrupulous touts. Does she agree?

Mrs Hodgson: I certainly do, and I shall come on to the Olympic games shortly. One of my suggestions is that we work with the Metropolitan police unit set up to tackle the issue. I am sure that my hon. Friend will meet it in the course of her work as a local MP. That unit also feels that £5,000 is nowhere near a big enough deterrent. There are measures in place, which I will come to in due course, but perhaps my hon. Friend will intervene on me again if I do not cover her point in detail.

I want to state explicitly that for the worst cases, the confiscation, under section 70 of the Proceeds of Crime Act 2002, of assets and cash thought to have been garnered through this activity should be considered. Clause 3 assumes an exemption from the limitations where the proceeds of an auctioned ticket are to be used for, or donated to, charitable purposes. Any exploitation of that assumption would obviously be investigable under the Charities Act 1993.

Philip Davies: The hon. Lady talks about her constituents and mine being exploited by ticket touts, but does she not accept that one of the worst exploitations in the whole ticketing market is carried out by promoters who sell tickets and then refuse to exchange them or give refunds? Somebody who buys a ticket and then finds that they cannot go to the event may not get a refund. In the secondary market, viagogo has a viagogo guarantee; if anything goes wrong, it guarantees people their money back. Surely that is giving people a better service than the primary ticket market does.

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