ARBITRATION CLAUSES (PROTOCOL) BILL [Lords].

TUESDAY, 8th JULY, 1924.

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The Committee consisted of the following Members:

Sir Cyril Cobb (Chairman).

Ainsworth, Major (Bury)

Alstead, Mr. (Altrincham)

Astor, Major (Dover)

Barclay, Mr. (Manchester, Exchange)

Beckett, Sir Gervase (Leeds, N.)

*Benn, Sir Arthur Shirley (Plymouth, Drake)

*Berkeley, Captain (Nottingham, Central)

Blundell, Mr. (Lancaster, Ormskirk)

Bourne, Captain (Oxford City)

Bramsdon, Sir Thomas (Portsmouth, Central)

Brown Mr. Ernest (Rugby)

Bullock, Captain (Lancaster, Waterloo)

Cayzer, Sir Charles (Chester City)

*Churchman, Sir Arthur (Suffolk, Woodbridge)

Clarry, Mr. (Newport)

*Costello, Mr. (Huntingdon)

Croft, Brig.-Gen. Sir Henry Page (Bournemouth)

Davies, Major George (Yeovil)

Edmondson, Major (Banbury)

Edwards, Mr. George (Norfolk, S.)

Foot, Mr. (Bodmin)

Grenfell, Mr. David (Glamorgan, Gower)

Hamilton, Sir Robert (Orkney and Shetland)

Harbison, Mr. (Fermanagh and Tyrone)

*Harris, Mr. John (Hackney, N.)

Hartington, Marquess of (Derbyshire, W.)

Hastings, Mr. Somerville (Reading)

*Hohler, Sir Gerald (Gillingham)

Horlick, Lieut.-Colonel (Gloucester)

Jones, Mr. Leif (Camborne)

Kirkwood, Mr. (Dumbarton)

Lee, Mr. Frank (Derbyshire, N. E.)

Leigh, Sir John (Wandsworth, Clapham)

*Lunn, Mr. (West Riding, Rothwell)

Makins, Brig.-Gen. (Chester, Knutsford)

Mansel, Sir Courtenay (Penryn and Falmouth)

Mills, Mr. (Kent, Dartford)

Montague, Mr. (Islington, W.)

Morrison-Bell, Sir Clive (Devon, Honiton)

Morse, Mr. (Somerset, Bridgwater)

Murrell, Mr. (Somerset, Weston-super-Mare)

O'Neill, Mr. John (Lancaster)

Oliver, Mr. George (Derby, Ilkeston)

Philipson, Mrs. (Berwick-on-Tweed)

Purcell, Mr. (Coventry)

Raffan, Mr. (Edinburgh, N.)

Rawson, Mr. Cooper (Brighton)

Robinson, Mr. William (Burslem)

Ropner, Major (Durham, Sedgefield)

Sandeman, Mr. (Lancaster, Middleton and Prestwich)

Sherwood, Mr. (Wakefield)

Stephen, Mr. (Glasgow, Camlachie)

Stuart, Lord Colum Crichton- (Chester, Northwich)

*Thomson, Sir William Mitchell- (Croydon, S.)

Tillett, Mr. (Salford, N.)

Viant, Mr. (Willesdon, W.)

*Webb, Mr. (Durham, Seaham)

Welsh, Mr. (Lanarkshire, Coatbridge)

*Whiteley, Mr. (Durham, Blaydon)

Williams, Lieut.-Col. T. S. B. (Lambeth, Kennington)

* Added in respect of the Arbitration Clauses (Protocol) Bill [Lords].—July 8, 1924.

MR. THROCKMORTON, Committee Clerks.

MR. DENT. Committee Clerks.

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1661 STANDING COMMITTEE C Tuesday, 8th July, 1924.

[Sir CYRIL COBB in the Chair.]

ARBITRATION CLAUSES (PROTOCOL) BILL [Lords].
[OFFICIAL REPORT.] CLAUSE 1.
—(Staying of court proceedings in respect of mutters to be referred to arbitration under commercial agreements.)

(1) Notwithstanding anything in the Arbitration Act, 1889, if any party to a submission made in pursuance of an agreement to which the said protocol applies, or any person claiming through or under him, commences any legal proceedings in any court against any other party to the submission, or any person claiming through or under him, in respect of any matter agreed to be referred, any party to such legal proceedings may at any time after appearance, and before delivering any pleadings or taking other steps in the proceedings, apply to that court to stay the proceedings, and that court or a judge thereof, unless satisfied that the agreement or arbitration has become inoperative or cannot proceed, shall make an order staying the proceedings.

(2) This Section in its application to Scotland and Northern Ireland shall have effect as if the reference to the Arbitration Act, 1889, were omitted therefrom, and in the application of this Section to Scotland references to staying proceedings shall be construed as references to sisting proceedings.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

The PRESIDENT of the BOARD of TRADE (Mr. Sidney Webb): May I, in courtesy to the Committee, make a little explanation? This is a very small Bill, on a matter which is of considerable interest to the commercial community. The Chambers of Commerce, and especially the International Chamber of Commerce, have been for a long time trying to get other countries to agree that, when a contract between citizens of different countries contains an arbitration clause, they should be quite sure that, if there be any dispute, the matter will be referred in the country concerned to arbitration, 1662 and will not be interfered with by the courts of law. After a good deal of trouble, a great, many countries have agreed to this, and, in order that it should be ratified, it is necessary that there should be a very minute amendment of the British law. The Scots law is all right. The Scots law says that, if people have agreed to go to arbitration, they shall go to arbitration. The British law says that they may go to arbitration; that is to say, that a judge may stay the proceedings of the court, and allow the arbitration to proceed according to the will of the parties. I am assured that our British judges exercise that discretion perfectly wisely and justly, and never prevent cases from going to arbitration unless there be some reason why they ought not to go. Of course, however, if we are asking that other countries should enable the parties to have their will and go to arbitration, we must give a corresponding security to the nationals of other countries that, in corresponding cases here, they shall be quite sure that they shall go to arbitration. This does inert alter the British law generally. It will only require such a clause in the contract to be carried out if it be between citizens of different countries, and I may say, also, that they must be citizens of countries which have ratified this convention. There is no question, therefore, of putting any obligations on this country which other countries will not recognise. The London Chamber of Commerce and other leading commercial organisations have assured me that this is exactly what they want. It was proposed by the British Member at the Economic Committee of the League of Nations, and I think it is absolutely non-controversial.

Captain BERKELEY: Before the Committee assent to this Clause, there are one or two points on which I think the Government ought to give us enlightenment. In the first place, under the Schedule to the Bill, which is referred to in Clause 1, provision is made that these arbitrations shall be in relation to contracts "relating to commercial matters or to any other matter capable of settlement by arbitration."— and there is a sub-paragraph in which each contracting State reserves the right to limit the obligation mentioned to com- 1663 mercial contracts. The President of the Board of Trade has told us that he is introducing this Bill at the desire of the commercial community, and primarily in relation to commercial contracts. The first point upon which I would ask for enlightenment is as to whether, if that be the case, it would not, in view of the very wide nature of the words in the Protocol, be in the interest of the community generally to introduce some words of limitation into Clause 1 of the Bill, providing that the ratification shall be in respect only of obligations which are considered to be commercial under the national law? The second point as to which I should like to ask the right hon. Gentleman is merely one of information. The Protocol does not come into force until two ratifications have been deposited with the Secretary General of the League of Nations at Geneva. I should like to ask whether any ratifications have yet been deposited, and, if so, what States have ratified? The third point is one in relation to the sister States of the Empire. Under Article 8 of the Protocol, the contracting States may declare that their acceptance "does not include any or all of the under-mentioned territories; that is to say, their colonies, overseas possessions or territories, protectorates, or the territories over which they exercise a mandate." In view of the fact that this Protocol was, presumably, signed by the Dominion representatives at Geneva, perhaps the President of the Board of Trade will tell us whether they are taking similar action in their respective Parliaments to ratify; and, secondly, he might tell us what is the policy of the Government with regard to Colonies that are not self-governing, and to protectorates and mandated territories.

Sir A. SHIRLEY BENN: As a member of the Arbitration Committee of the International Chamber of Commerce which is now operating, I want to say how glad we are that the Government have taken this action, and the sooner it is taken the better it will be for commercial interests not only at home, but abroad. The Arbitration Committee have had a good many cases in England where Chambers of Commerce, especially in Liverpool and Manchester, have done a great deal of service in connection with 1664 trade disputes. As regards the Colonies, they are as keen as we are about having arbitration, and I feel confident that, where they have not taken action, they will take a lead from the Mother Country. I hope the Bill will go through without any alteration.

Mr. WEBB: The reason why this is now limited in the Bill to what may be called commercial contracts is, I am informed, because the term is hardly known in bur law. The Arbitration Act at present in force applies to all contracts, and it would be very difficult to introduce a new definition of contracts. That particular phrase stands in the Protocol with reference to those States, that are numerous, which have a special commercial code. We have not a special commercial code, and it would not be understood easily what was a commercial contract. Consequently, that is the reason why there is no word of limitation here. Parliament reserves the right to limit it afterwards if necessary, but it is not suggested that it could be conveniently limited according to the terms of English law. With regard to the Colonies and Dominions, of course they are being communicated with, and no ratification will take place on their behalf without their consent. I cannot say actually whether it will have to be brought before their Legislatures, because it depends whether there is any alteration of of their law required; but nothing will be done without the consent of the Dominion Governments. They will either be excluded or included according as they wish, but we have no reason to suppose they will wish to be excluded. The third question is what countries have already ratified? There are two stages. The Protocol has been signed and agreed to on behalf of their Governments by Great Britain, Belgium, Brazil, Denmark, France, Germany, Greece, Italy, Japan, Lithuania, Monaco, The Netherlands, Panama, Roumania, and Uruguay, which represents a very considerable agreement. We expect all those countries will ratify. We have not any knowledge at present that any one of them has ratified, but it does not come into force until two countries have ratified, and then only in relation to the countries which have ratified. If Great Britain ratify formally, the others will come in extremely rapidly.

Question put, and agreed to.

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Clause ordered to stand part of the Bill.

Clause 2 (Short Title) ordered to stand part of the Bill.

Schedule agreed to.

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Bill, without amendment, ordered to be reported to the House.

The Committtee rose at Twenty minutes after Eleven o'Clock.

THE FOLLOWING MEMBERS ATTENDED THE COMMITTEE:—

Cobb, Sir Cyril (Chairman).

Astor, Major

Barclay, Mr.

Benn, Sir Arthur Shirley.

Berkeley, Captain

Bourne, Captain

Bramsdon, Sir Thomas

Bullock, Captain

Edwards, Mr. George

Grenfell, Mr. David

Hamilton, Sir Robert

Harris, Mr. John

Lee, Mr. Frank

Mills, Mr.

Montague, Mr.

Oliver, Mr. George

Sandeman, Mr

Viant, Mr.

Webb, Mr.

Whiteley, Mr.

Williams, Lieut.-Colonel T. S. B.