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The Lord Chancellor moved Amendment No. 34:

Page 14, leave out lines 37 to 46 and insert--
("4.--(1) This paragraph applies in the case of land held on charitable, ecclesiastical or public trusts (other than land to which the Universities and College Estates Act 1925 applies).
(2) Where there is a conveyance of such land--
(a) if neither section 37(1) nor section 39(1) of the Charities Act 1993 applies to the conveyance, it shall state that the land is held on such trusts, and
(b) if neither section 37(2) nor section 39(2) of that Act has been complied with in relation to the conveyance and a purchaser has notice that the land is held on such trusts, he must see that any consents or orders necessary to authorise the transaction have been obtained.
(3) Where any trustees or the majority of any set of trustees have power to transfer or create any legal estate in the land, the estate shall be transferred or created by them in the names and on behalf of the persons in whom it is vested.").

On Question, amendment agreed to.

Schedule 3 [Minor and consequential amendments]:

The Lord Chancellor moved Amendment No. 35:

Page 20, line 7, at end insert--
("( ) In section 40(2), after the word "appointed" insert "or under section (Appointment and retirement of trustee at instance of beneficiaries)(2)(a) of the Trusts of Land and Appointment of Trustees Act 1996".").

On Question, amendment agreed to.

Schedule 4 [Repeals]:

The Lord Chancellor moved Amendments Nos. 36 to 37:

Page 27, line 30, column 3, at end insert--
("Section 29.")

Page 33, line 20, at end insert--
("1993 c. 10.The Charities Act 1993.Section 37(6).Section 39(5).")

On Question, amendments agreed to.

In the Title:

The Lord Chancellor moved Amendment No. 38:

Line 4, after ("appointment") insert ("and retirement").

On Question, amendment agreed to.

Baroness Trumpington: My Lords, I beg to move that the House do now adjourn during pleasure until 8.5 p.m.

Moved accordingly, and, on Question, Motion agreed to.

[The Sitting was suspended from 7.56 to 8.5 p.m.]

Housing Grants, Construction and Regeneration Bill [H.L.]

Consideration of amendments on Report resumed on Clause 106.

Lord Howie of Troon moved Amendment No. 152:

Page 60, line 39, at end insert--

22 Apr 1996 : Column 972

("Adjudication is not arbitration, the main difference between them being that the decision on an adjudication is not binding except with the consent of the parties. It is an interim decision which must be accepted for the duration of the contract but which can be challenged later either by arbitration or through the courts.").

The noble Lord said: My Lords, I come to this amendment fresh from a dinner in Terrace Room A with the Construction Industry Group, although I was able to stay only for the first course. I hope to get back for the pudding with any luck, but who can tell. The group sent me here with an enthusiastic urge to persuade the Government to do their best, though we are not doing too badly so far.

Amendment No. 152 is by way of definition. I seem to recall that in the Second Reading debate my noble friend Lord Williams drew attention to the fact that, while there was a large battery of definitions in Part I of the Bill, there was none in Part II, which is the part that concerns us here tonight.

The amendment contains a kind of definition. I say "kind of" definition because it does not actually say what adjudication is; it says what it is not. However, that is the important part in regard to the findings of adjudication in the whole ethos of the Bill. Everybody in the construction industry and those concerned with this Bill, with the possible exception of the Government, believe that the Government have confused arbitration and adjudication. There is no doubt that the majority of opinion is correct and that the Government are wrong. It would help us a great deal if the Government were to accept Amendment No. 152. I am not sure whether it is in the right place, but it should be included somewhere.

The definition is not complete. I notice that my noble friend Lord Berkeley has tabled a more judicial definition than I managed to; but I have drawn attention to the key factor which runs through a large part of the Bill and which caused so much annoyance within the construction industry. The confusion is on the government side; the annoyance is on the construction industry side.

The key to the amendment lies in the first four words--"Adjudication is not arbitration". On that simple proposition I rest my case, apart from reminding the Minister that the scheme also confuses the two. I believe it does that quite deliberately. It applies elements of arbitration law to adjudication. I beg to move.

Lord Berkeley: My Lords, in supporting the amendment of the noble Lord, Lord Howie of Troon, if it be convenient for the House, I would like to speak also to my amendment No. 152A. My purpose in putting down the amendment is to have the definition of "adjudication" included--exactly the same purpose as that of the noble Lord, Lord Howie. It follows on from the amendment which we discussed earlier this evening, Amendment No. 151, proposed by the noble Baroness, Lady Hamwee. The amendments have the same objective--to define adjudication. Again, I am not saying that my drafting is the right solution. We have a definition of "dispute"; we have had "construction contracts" defined previously in Part II, and also "construction operations", which we discussed at some length earlier this evening.

22 Apr 1996 : Column 973

There should be a short and clear description of what adjudication is. I hope that the words "summary", which, I believe, means quick and easy, and "non-judicial" can also appear to emphasise the importance that the procedure, which we shall be discussing in later amendments, does not involve expensive lawyer time. The wording I have put towards the end of the amendment is my latest understanding of what the purpose of the scheme and Part II is about.

With those few words, I hope that the noble Lord the Minister will be able to look at both amendments with a view to putting in some definition which will help to clarify what we are all doing and what the Bill is all about.

Lord Williams of Elvel: My Lords, as the House will recognise, I am not against purpose amendments. I believe there is a case for saying, in the rubric to the clause:

    "Right to refer disputes to adjudication."
There should be some wording about what adjudication, as opposed to arbitration, really means. That would lead us into further discussion about the scheme and all the rest of it but, in supporting either of my noble friends, whichever amendment the Government wishes to accept--I am sure they will accept one of them--it would be sensible, in my view, to put something in as a purpose of adjudication, because the industry, as my noble friends have said, is unclear. We do not know whether the Government mean adjudication or arbitration. They would be wise to put something in Clause 106 to reflect what is meant by "adjudication".

Lord Lucas: My Lords, the difficulty we have with the two amendments is that we do not wish to restrict the contracting parties opting for something close to arbitration. We have discussed at length the difference between arbitration and adjudication; I believe that we are basically agreed on that. However, we do not wish to stop parties opting for arbitration if that is what they want. We believe that, within the context of making things work better, that would be acceptable. We do not therefore want to draw the definition in Clause 106 so tightly that people cannot go down that route if that is what they want to do.

As I said just before supper, we have accepted the arguments made in Committee and subsequently by noble Lords, and we have concluded that it would be right if disputes which are subject to the scheme adjudication could normally be re-opened at practical completion of a contract. That is making the whole scheme very much closer to pure adjudication than it was, and I am sure that that is welcome to the noble Lord, Lord Howie.

Lord Williams of Elvel: My Lords, I am sorry to intervene at this stage but, as I understand it, Clause 106 specifies:

    "A party to a construction contract has the right to refer a dispute arising under the contract for a resolution by an adjudication procedure".

22 Apr 1996 : Column 974

It seems to me, subject to clarification, that if there were something saying: "This is what adjudication is about", that would be the right place in which to put it.

8.15 p.m.

Lord Lucas: My Lords, yes, I entirely agree. We have said as much as we wish to say. The argument behind our not wishing to say more is that we do not want to fetter parties to the contract more than we believe is necessary in order for them to achieve the effect we are looking for; namely, a satisfactory procedure for resolving disputes. If they happen to want something which is close to arbitration, we do not want to force adjudication on them. We want their freedom to contract to be as wide as possible concomitant with their having an agreement which does what we believe it should do in providing a disputes procedure. Clause 106(2)(a) to (d) sets out the limits on adjudication as we see it, with the qualities that the procedure must have. I agree that this need not be adjudication. It need not be adjudication, as the noble Lord, Lord Howie, knows it, as we shall now have it in the scheme; it could be something which is almost pure arbitration if that is what the contracting parties want.

We do not see the need to restrict the contracting parties just to go for adjudication. We do not see why we should draw things that narrowly if they happen to want to go wider. The question of whether there should be a definition of adjudication in the scheme is a matter for a later clause. This clause deals with what is acceptable in contracts and not what should appear in the scheme. That is at the heart of our objection to the two amendments; it is not that we disagree with either of the attempts to define adjudication. But at this stage of the Bill we do not wish to restrict contracting parties in that way.

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