91 STANDING COMMITTEE A Tuesday, 29th March, 1927.

[Major Sir RICHARD BARNETT in the Chair.]

AUCTIONS (BIDDING AGREEMENTS) BILL.
[OFFICIAL REPORT.] CLAUSE 2.
—(Right of vendors to treat certain sales as fraudulent.)

Any sale at an auction with respect to which any such agreement as aforesaid has been made may be treated as fraudulent by the vendors or their agent as against a purchaser who has been a party to such agreement.

Lord FERMOY: I beg to move, after the word "agreement ("any such agreement as aforesaid"), to insert the words "or transaction." This Amendment is put forward in order to cover actual payments where prior agreement can be proved. I think the Committee will see that it is necessary after the Amendments already passed.

Mr. A. V. ALEXANDER: Really, this is an extraordinary way to do business in Committee. The Noble Lord moves an Amendment which is vital to the whole of the Amendments which have been proposed to the Bill in Committee, and gives no explanation of it at all. On reflection he will see that this is the Amendment in the body of the Bill which is rendered necessary by the very important Amendment—to come later—with regard to the title of the Bill. It is because of the Amendment he has just moved that the promoters of the Bill have found it necessary to amend the title—to cover that and other important Amendments—and yet on this very important matter with regard to the rights of vendors no explanation has been given in the Amendment. I ask the promoters of the Bill to give us a reasoned explanation of the Amendment. 92 It is not treating the Members of the Committee fairly to move an Amendment in that way.

Major ALAN McLEAN: This Amendment is really consequential on the Amendment already introduced in Clause 1. If hon. Members will look at Clause 1 as it now stands they will see it reads thus: "If any dealer agrees to give" that is an agreement "or gives, or offers, any gift or consideration." that is a transaction. The giving or offering is a transaction, it is not an agreement at all, and these words are necessary as a result of the alteration already made in Clause 1.

Mr. ALEXANDER: In other words, the real purpose of the Bill, to deal with agreements as such, has been entirely altered in Committee, and now anybody who makes any sort of business transaction at all is to be at the mercy of the common informer.

Major McLEAN: No.

Mr. ALEXANDER: Oh, yes; we have now got a Bill so loosely drawn that nobody will ever know exactly whether he is coming within the law or not. This Amendment proves once more how very sound our opposition to the Bill has been. I am not going into a lot of detail this morning as to different kinds of transactions which are likely to arise, which will bring quite honest British citizens within the possibility of being accused of a crime by the common informer, but this Amendment only adds to my contempt for the Bill.

Sir DOUGLAS NEWTON: I am afraid it will be difficult for me to allay the suspicions which have apparently entered the mind of the hon. Member for the Hillsborough Division (Mr. A. V. Alexander). I would like to do what I can towards reassuring him by pointing out that there is a definition Clause, which I think will prevent any injustices or hardships from arising under the Bill.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 19; Noes, 5.

93
Division No. 13.] AYES.
Acland-Troyte, Lieut.-Colonel Graham, Fergus (Cumberland, N.) Lamb, J. Q.
Broun-Lindsay, Major H. Harvey, G. (Lambeth, Kennington) McLean, Major A.
Campbell, E. T. Henderson, Capt. R. R.(Oxf'd, Henley) Newton, Sir D. G. C. (Cambridge)
Erskine, Lord (Somerset, Weston-s-M.) Heneage, Lieut.-Col. Arthur P. Nuttall, Ellis
Everard, W. Lindsay Holt, Captain H. P. Warner, Brigadier-General W. W.
Fermoy, Lord Jones, Henry Haydn (Merioneth) Watts, Dr. T.
Gadie, Lieut.-Col. Anthony
NOES.
Alexander, A. V. (Sheffield, Hillsbro') Connolly, M. Windsor, Walter
Bromley, J. Scurr, John

Lord FERMOY: I beg to move, after the word "made," to insert the words "or effected." The insertion of these words is merely consequential on the alterations made in the title of the Bill.

Mr. ALEXANDER: Once more, I should like to know exactly why we have not had a more lucid explanation of this Amendment. The suggestion, again, is to bring within the scope of the Bill any possible loose arrangement which the promoters suspect may be come to in order to avoid any trouble. The hon. Member for Cambridge (Sir D. Newton) seems to regard me as being very suspicious, but the real charge of suspicion lies against the promoters of the Bill who are putting in all these extra words and Clauses in order to draw as many innocent people as possible within the scope of this Measure. What is the reason for wishing to extend this Clause so as to operate against all those who have made

Division No. 14.] AYES.
Acland-Troyte, Lieut.-Colonel Graham, Fergus (Cumberland, N.) Lucas-Tooth, Sir Hugh Vere
Broun-Lindsay, Major H. Harvey, G. (Lambeth, Kennington) McLean, Major A.
Campbell, E. T. Henderson, Capt. R. R.(Oxf'd, Henley) Newton, Sir D. G. C. (Cambridge)
Erskine, Lord (Somerset, Weston-s-M.) Heneage, Lieut.-Col. Arthur P. Nuttall, Ellis
Everard, W. Lindsay Holt, Capt. H. P. Warner, Brigadier-General W. W.
Fermoy, Lord Jones, Henry Haydn (Merioneth) Watts, Dr. T.
Gadie, Lieut.-Col. Anthony Lamb, J. Q.
NOES.
Alexander, A. V. (Sheffield, Hillsbro') Connolly, M. Scurr, John
Bromley, J. Lawrence, Susan Windsor, Walter

Mr. ALEXANDER: I beg to move, after the words last inserted to add the words "and winch has been the subject of a prosecution and conviction." The promoters of that Bill will see that this is al very necessary Amendment, and, after my explanation, I hope that they will not suggest that we have been guilty of repetition. In this matter, we have tried to be as brief as we can. Hon.

94

an agreement? I should be glad to have an explanation from the hon. and gallant Member for South-West Norfolk (Major McLean) who seems to be the mainspring of this Measure, although it was the Member for King's Lynn (Lord Fermoy) who, like a lamb to the slaughter, seems to have been led into introducing the Bill itself.

Mr. LAMB: The arguments used in connection with the last Amendment are also applicable to this Amendment, but I will not repeat them. The hon. Member for Hillsborough (Mr. A. V. Alexander) used the word "suspect" in this case, but we do not want to convict anyone upon suspicion only, and therefore we have moved the insertion of the words "or effected."

Question put, "That those words be there inserted."

The Committee divided: Aves 20; Noes 6.

Members will see that it is quite possible under the Clause as at present drafted for a process to be set in motion to treat a sale as fraudulent in any case whether there has been actual proof from a prosecution by the Attorney-General or not. You may have a case arising in which the common informer has submitted a statement of facts to the Attorney-General or the Solicitor-General, but for all this the Law Officers 95 of the Crown may have declined upon those facts to order a prosecution in the public interest. Notwithstanding that, it may be possible under this Clause for the people who are the actual parties to the contract of sale to take separate action under the Bill in its present form to sue for damages or to regard the sale as having been fraudulent. It seems to me that it is essential to protect people in those circumstances, and, if the promoters of the Bill are sincere in all the speeches they have made during previous stages of this Bill, I am sure they will see that this is a sound and logical Amendment. If there has been under the Act an actual prosecution in which a conviction is secured, it does seem, so far as the desires of the promoters of the Bill are concerned, to be a case for treating the sale as obtaining money or benefit under false pretences or as fraudulent. If that has not been done there is no case, and we should not miss this opportunity of giving proper security to quite legitimate transactions.

Mr. SCURR: I hope we are going to have some reply to this Amendment. My hon. Friend has put forward his reasons for moving it, and, although the promoters of the Measure seem to be in an hilarious condition, and have been treating the Committee in a manner which almost amounts to contempt because certain Amendments were put forward, I think it is treating us with scant courtesy not to attempt to give any reply to this Amendment. It is a serious question, and, if someone suggests that an agreement has been entered into or effected and the transaction is treated as fraudulent, and the persons concerned are liable to actions for damage and all the rest of it, that means that, after they have incurred such civil penalties, then, because a civil Court will have decided that they have offended against the law, they will be liable to prosecution and conviction under this Bill. I think that what the promoters of this Measure are after is not a matter of getting damages, but to prevent these transactions to which they are objecting being carried into effect. The obvious thing is that, when a prosecution has taken place and a conviction has resulted, we have decided that something has been done contrary to the Act, 96 and those persons can regard it as fraudulent. I think we are entitled to some answer to this Amendment.

Lieut.-Colonel GADIE: I hope the Committee will accept this Amendment. After the alterations which were made the other day, I am not at all enamoured with this Measure, and I am going to move Amendments which I think will help the Bill. We are not out to catch and make people criminals who have no intention to offend in any direction. The Court has to be satisfied that a man or men have committed a breach according to this Bill before you can take action, but to make it wide and include all these prosecutions would make the Bill a farce. That would not be prosecution, but persecution.

Major McLEAN: This Amendment would lead to a good deal of delay in some cases, and in the case of perishable goods it might make the Measure inoperative. There is, however, a good deal to be said in favour of it, and I suggest that the Committee might agree to insert these words. Then before the Report stage we will seriously consider the point again, and if we find there is any real objection to the words, we can ask the House to strike them out again.

Mr. ALEXANDER: I only want to say that after long last, at the third meeting of this Committee, we have to rise and thank the promoters of the Bill for a very small concession.

Amendment agreed to.

Major McLEAN: I beg to move, to leave out the words "be treated as fraudulent by the vendors or their agent." This Amendment is intended to prepare the way for the next Amendment on the Order Paper—at the end of the Clause to add the words "or transaction be treated by the vendor as a sale induced by fraud: Provided that a notice or intimation by the vendor to the auctioneer that he intends to exercise such power in relation to any sale at the auction shall not affect the obligation of the auctioneer to deliver the goods to the purchaser"— Practically, they are drafting Amendments. These words put into more precise legal terminology the right which should be given to the vendor. As the Clause stands, it proposes to treat the 97 sale as fraudulent, and, if we were going to keep to the phraseology of the Bill, I should be inclined to alter the word "sale," because it is not so much in the sale that there is an element of fraud as in the purchase. The element of fraud is not so much in the actual sale as in the circumstances arising prior to and concerning the sale by previous agreement. We can express our meaning better by regarding the sale as being induced by fraud rather than being in itself fraudulent. May I say a word about the legal effect of this Amendment? We suggest that the right to be given to the vendor is that, on discovering the fraud, he should have the option of treating the sale as having been induced by fraud. I am afraid it is a. good many years since I practised at the Bar, and my legal knowledge is rather rusty, but I think that in such a case the vendor would be entitled to treat the sale as null and void and would be able to recover the goods. If in the meantime the purchaser had resold them to a bona fide purchaser, the vendor would not be entitled to annul the sale as against the second purchaser, but he would be left with his remedy in damages from the purchaser who bought from himself. With regard to the proviso, we are putting this in for the purpose of protecting the auctioneer. It would be obviously unfair to put him in the position of a stake holder and compel him to hold the goods until the dispute between the vendor and the purchaser had been settled. The only question is whether the auctioneer should be entitled to deliver the goods to the purchaser or return them to the vendor, and, as the onus of proving the fact that the sale had been induced by fraud would be on the vendor pending that proof, the auctioneer would be right in treating the sale as a perfectly valid one, and, therefore, the goods should be delivered to the purchaser.

Mr. G. HARVEY: Will the Clause read correctly if we leave out these words. It does not read sense to me.

The CHAIRMAN: It will read all right with the addition of the proposed second Amendment, and that is why the two are being discussed together.

Mr. ALEXANDER: I have been looking at this Amendment while the hon. 98 Member has been speaking, and I must appeal to the promoters to reconsider the position and give us some little justice in this matter, especially on this Amendment which deals with what is described as "a sale induced by fraud." We want something put in which will protect the purchaser as well as the vendor. As the Bill is being carried through, it gives protection only to the vendor. Why should you not give protection to the man who has been induced to become a purchaser at an auction by fraud? The words proposed to be inserted later strengthen my contention. It is proposed to add the words "or transaction be treated by the vendor as a sale induced by fraud." We have hundreds of cases every year in this country where it could be shown that the purchaser has been induced to buy by fraud. There are the cases which have been already referred to, such as cheap-jack auctions in the Strand and at Blackpool and Scarborough, and other places, in which there is not the slightest doubt that these methods are practised. I came down in the train last Sunday from an engagement in the North of England. I travelled with a lady—she was with her husband and therefore hon. Members need not be very critical—and I overheard the conversation. She pulled out of a little bag a small-bladed knife which she explainer to the people in the carriage was given her by a cheap-jack auctioneer at Blackpool to induce her to buy a silver watch which, on examination, proved to be nothing like the value she had been induced to pay for it. It seems to me an iniquitous thing to pass legislation like this, and provide no protection at all for the class of persons who go to these kind of auctions. If we agree to accept the Amendment and leave out the words "be treated as fraudulent by the vendors or their agent," then, I hope, the promoters will accept an Amendment which I propose to move, to insert after the word "vendor" in the proposed second Amendment the words "or purchaser." Then I hope they will also accept an Amendment to add words at the end of the Clause in the form which I have handed up to the Chairman.

The CHAIRMAN: Let us get this quite clear. The hon. Member has handed in 99 a manuscript Amendment. It is not an Amendment to the proposed Amendment, as it comes at the end of Clause 2. If the second Amendment which is to be moved by the hon. Member for South-West Norfolk (Major McLean) is carried, then the manuscript Amendment of the hon. Member for Hillsborough (Mr. A. V. Alexander) will be out of order. It would not make sense. It would only be in order if the proposed second Amendment were lost.

Mr. ALEXANDER: Would it not read if we inserted in the proposed second Amendment, to be moved by the hon. Member for South-West Norfolk, the words "or purchaser" after the word "vendor"

The CHAIRMAN: The Amendment which the hon. Member has handed in is to add words at the end of the Clause, and they would not make sense.

Lieut.-Colonel GADIE: May I read the Clause as it is proposed to be amended and with the insertion of the Amendment which has been already passed? It would read in this way: "Any sale at an auction with respect to which any such agreement or transaction as aforesaid has been made or effected, and which has been the subject of a prosecution and conviction, may as against a purchaser who has been a party to such agreement or transaction—be treated by the vendor as a sale induced by fraud." It does not seem to me that the hon. Member for Hillsborough (Mr. A. V. Alexander) is going to get anything by the suggestion which he has put forward.

Lieut.-Colonel ACLAND - TROYTE: May I ask whether the suggestion of the hon. Member for Hillsborough (Mr. A. V. Alexander) comes under the Bill in any way? It is an Auctions (Bidding Agreements) Bill. The proposal does not affect bidding at auctions at all.

The CHAIRMAN: I think we are quite within the scope of the Bill in considering the inclusion of such words as are suggested.

Mr. SCURR: Surely there is some substance in the case put forward by the hon. Member for Hillsborough (Mr. A. V. Alexander) in regard to the purchaser. The Bill seems to be considered simply from the vendor's point of view, but surely there should be some protection 100 to anyone who had been induced by fraud to purchase, and I am of the opinion that the Amendment suggested by the hon. Member for Hillsborough will strengthen the Bill. Like the hon. Member for Central Bradford (Lieut.-Colonel Gadie), we want the auction room to be clean, but clean not only as regards the vendor but also as regards the purchaser. One of the difficulties is that the promoters of the Measure are considering all the time one particular form of auction—agricultural auctions—and they are not thinking of those other auctions with which we are familiar in towns and cities. We know the practices that obtain there, and we want some protection not only for the vendor but for the purchaser as well. I hope the promoters of the Bill will accept the Amendment which is suggested.

The CHAIRMAN: I do not know to what Amendment the hon. M ember for Stepney (Mr. Scurr) is speaking. The hon. Member for Hillsborough (Mr. A. V. Alexander) has intimated that he proposes to move an Amendment, but he has not done so yet. The only Amendment he has suggested is to add something at the end of Clause 2, which will not be in order if the Amendment now before the Committee is carried.

Mr. SCURR: You have not formally put the second Amendment of the hon. and gallant Member for South West Norfolk (Major McLean) yet.

The CHAIRMAN: No.

Mr. ALEXANDER: I do not want to prolong the discussion. I took the opportunity on the first Amendment of appealing to the promoters to reconsider the question of providing for the protection of the purchaser who was induced by fraud to buy something he does not want or at a price which is too high in relation to the value of the article. If the promoters of the Bill are not prepared to accept the suggestion, then we must vote against the Amendment. It is not worth while spending a lot of time on the matter, but I think it will necessitate our putting down Amendments at a later stage of the Bill which will not help the passage of the Measure through Parliament.

Mr. LAMB: I think a complete answer was given to the hon. Member for Hillsborough (Mr. A. V. Alexander) by the 101 hon. Member for Central Bradford Agreements) Bill. (Lieut.-Colonel Gadie).

Mr. ALEXANDER: The hon. Member for Central Bradford (Lieut.-Colonel Gadie) met the point with regard to agreements in respect of providing against fraud on the part of the vendor, but he did not deal with the point in regard to the protection of the purchaser who may be induced by fraud to buy.

Question, "That the words proposed to be left out stand part of the Clause," put, and negatived.

Major McLEAN: I beg to move, at the end of the Clause, to add the words

Division No. 15.] AYES.
Alexander, A. V. (Sheffield, Hillsbro') Graham, Fergus (Cumberland, N.) Scurr, John
Bromley, J. Jones, Hanry Haydn (Merioneth) Windsor, Walter
Connolly, M. Lawrence, Susan
NOES.
Acland-Troyte, Lieut.-Colonel Gadie, Lieut.-Col. Anthony Lucas-Tooth, Sir Hugh Vere
Alexander, E. E. (Leyton) Henderson, Capt. R. R.(Oxf'd, Henley) McLean, Major A.
Broun-Lindsay, Major H. Heneage, Lieut.-Colonel Arthur P. Newton, Sir D. G. C. (Cambridge)
Campbell, E. T. Holbrook, Sir Arthur Richard Nuttall, Ellis
Erskine, Lord (Somerset, Weston-s-M.) Holt, Captain H. P. Warner, Brigadier-General W. W.
Everard, W. Lindsay Lamb, J. Q. Watts, Dr. T.
Fermoy, Lord

Question put, "That the proposed words be there added"

Division No. 16.] AYES.
Acland-Troyte, Lieut.-Colonel Gadie, Lieut.-Col. Anthony Lamb, J. Q.
Alexander, E. E. (Leyton) Graham, Fergus (Cumberland, N.) Lucas-Tooth, Sir Hugh Vere
Broun-Lindsay, Major H. Harvey, G. (Lambeth, Kennington) McLean, Major A.
Campbell, E. T. Henderson, Capt. R. R.(Oxf'd, Henley) Newton, Sir D. G. C. (Cambridge)
Erskine, Lord (Somerset, Weston-s-M.) Heneage, Lieut.-Col. Arthur P. Nuttall, Ellis
Everard, W. Lindsay Holbrook, Sir Arthur Richard Warner, Brigadier-General W. W.
Fermoy, Lord Holt, Captain H. P. Watts, Dr. T.
NOES.
Alexander, A. V. (Sheffield, Hillsbro') Jones, Henry Haydn (Merioneth) Scurr, John
Bromley, J. Lawrence, Susan Windsor, Walter

Further Amendment made: After the words last inserted, add the words "Provided that a notice or intimation by the vendor to the auctioneer that he intends to exercise such power in relation to any sale at the auction shall not affect the obligation of the auctioneer to deliver the goods to the purchaser."—[Major McLean.]

Clause, as amended, ordered to stand part of the Bill.

Clause 3 (Copt of Act to be exhibited at sale) ordered to stand part of the Bill.

102

"or transaction be treated by the vendor as a sale induced by fraud."

Mr. SCURR: I beg to move, as an Amendment to the proposed Amendment, after the word "vendor," to insert the words "or purchaser." We have argued the question already, and I will not therefore say any more about it.

Question put, "That those words be there inserted in the proposed Amendment."

The Committee divided: Ayes, 8; Noes, 19.

The Committee divided: Ayes, 21; Noes, 6.

CLAUSE 4.
—(Short Title.)

This Act may be cited as the Auctions (Bidding Agreements) Act, 1927.

Mr. A. V. ALEXANDER: I beg to move, at the end of the Clause, to add the words "and shall come into operation on the first day of July, nineteen hundred and twenty-eight." We are so concerned about the promoters of the Bill that we are anxious still to pluck them as brands from the burning, and to give them an opportunity 103 for reconsideration of the matter by delaying the date fixed as the appointed day under the Act. The main reason why we move this Amendment is that we have brought to the mind of the promoters of the Bill, again and again, the fact that if there be abuses of auctions by biddings and agreements this Bill only professes to deal with a very small proportion of them. It is very unfair that legislation should be passed in that way. I suggest that the Committee should agree to accept July, nineteen hundred and twenty-eight as the appointed day. It will then give an opportunity for consultation and consideration with a view to the other Bill which has been submitted to the House in regard to mock auctions, coming into operation at the same time. In the discussion of that Bill we might also get protection provided, if possible, for the purchasers at auctions who are induced by fraud to pay prices which are not proper prices. If we could come to an arrangement for delaying the appointed day so that we could get some consolidation of the Bills dealing with auctions, although we should be passing separate Bills, it would be a very good thing.

Major McLEAN: Where the Bill is of a complicated nature and directions have to be given by the Home Office, or the particular Department concerned, and a good many forms have to be provided, it is reasonable to postpone the operation of the Act for a substantial time. We do feel, however, that there may be some objection to the Act coming into operation immediately it is passed. Therefore, if hon. Members opposite would accept an Amendment to postpone the operation of the Bill, say, to the 1st January of next year, we should be prepared to meet them on that. We do not feel that we ought to persist in pressing the Act into operation immediately, and we are prepared reasonably to meet hon. Members opposite.

Mr. ALEXANDER: I think that is trying to meet us, in a degree, and I think we shall accept it; but I want to point out that it depends very largely from our point of view whether we get the other Bill dealing with mock auctions. The reason why I proposed July of next year was that there might be a possibility of making certain that the other Bill gets 104 through by that date. The promoters of the Bill are offering January of next year as a concession, and we will accept it if they will, in the meantime, pay their attention to the other Bill before the House with a view to getting general legislation through on the same day.

Amendment, by leave, withdrawn.

Amendment made: At end of the Clause, add the words "and shall come into operation on the first day of January, nineteen hundred and twenty-eight."—[Major McLean.]

Lord FERMOY: I beg to move, at the end of the Clause, to add a new Subsection: "(2) This Act shall not extend to Northern Ireland." I think such an Amendment is customary in Bills passed in this House.

Mr. ALEXANDER: I do not know whether we can regard the Noble Lord the Member for Weston-super-Mare (Lord Erskine) as a representative of the Home Office; but I should like to ask him whether this Amendment has been put forward at the suggestion of the Home Office, and whether the existing arrangements between this country and Northern Ireland are such that it is not possible to apply this legislation to Northern Ireland. If we are told that that is the statutory position, of course, there is nothing more to be said, but if it is not the statutory position, there can be no reason why this Act should not apply to Northern Ireland.

Lord ERSKINE: I am informed that the passing of this Bill in this House would infringe the powers that are possessed by the Parliament of Northern Ireland, and that it is for the Parliament of Northern Ireland to legislate on this matter should they so desire, because those powers have been transferred to that Parliament under the Act which was passed whereby the Northern Ireland Parliament was set up. That is the reason why this Amendment has been put in. It has been put in at the request of the Home Office. It is usual to put in such an Amendment when a Bill of this sort is passed in the Imperial Parliament.

Amendment agreed to.

Mr. SCURR: I beg to move, after the words last inserted, to add the words 105 "This Act shall only apply to auctions for the sale of cattle, sheep, pigs, and agricultural produce." I regard this Amendment as of the greatest possible importance, because I think it secures the objects which the promoters of the Bill have at heart. Throughout the whole of the discussion which has taken place both in the House and Committee on the various Clauses, we have had instances constantly quoted by hon. Members opposite of what takes place at auctions of agricultural produce. I am the representative of an urban constituency in London and do not pretend to know anything about agriculture. Probably, as I know nothing about agriculture I ought to be able to make a very good speech on the subject, because we often find in the House that the less you know of a subject the longer is the speech you deliver. I have not been guilty of that particular practice. I understand from hon. Members who come from agricultural constituencies that there are certain evils in connection with auctions of cattle, and things of that kind. We in the towns are faced with a totally different proposition. We are all prepared to admit that there are in regard to knock-out rings considerable dangers of people, especially the sellers of the goods, being swindled by reason of bogus agreements. I have an instance in my mind of what happened to a firm engaged in the engineering trade. I was brought into active contact with the case because I was a clerk in the office of an accountant's firm, which was constantly being made a trustee in bankruptcy. There was a very large engineering plant to be sold. There were goods amounting to the value of £4,000 or £5,000, new goods, and they were put up at auction without any reserve, it being a bankruptcy sale. The sale was attended by all the dealers in the East End of London, and that £4,000 or £5,000 worth of machinery and stock did not realise £250 at the auction. I remember one thing in particular. There was a Crossley gas engine, which was worth something like £150, and it went for £2 10s.: an absolutely absurd price. That business was done entirely by agreements between the dealers who were there, and when the sale was over they proceeded to a neighbouring public house 106 and divided the things among themselves in the way that is done by such people.

Mr. LAMB: That is what we are trying to stop.

Mr. SCURR: I feel that you will not stop it by this Bill. If the promoters will accept the new Clauses which I have on the Paper, which are intended to deal specifically with the matter, I would be prepared not to move this Amendment. I am sure that you are not dealing with the evil in the Bill as it stands. The first Clause which we have passed only deals with gifts and considerations. It is possible for these transactions to be carried out without any gift or consideration. One person will say: "I am not bidding," or, "I am bidding for that gas engine, and I shall bid £5 for it." The other parties to the transaction do not receive any gift. They do nothing at all, and the transaction is carried out. Sometime later, they meet together, and the things which they have obtained are offered for sale amongst themselves as a separate transaction. I want it to be quite specific that these things are dealt with. If hon. Members think that the Bill as it stands meets the agricultural point of view, I suggest that they ought to confine it to the sale of cattle, sheep, pigs and agricultural produce, unless they are prepared properly to deal with the evil that exists in the towns.

Lieut.-Colonel HENEAGE: I very much hope the Committee will not accept this Amendment. From what the Mover said, I understand he wishes to restrict the Bill to agriculture, but I doubt very much whether the Amendment would have that effect. His Amendment refers to "cattle, sheep, pigs, and agricultural produce." It is quite possible that the words "agricultural produce" will cover the whole of it. But where would poultry and rabbits come in? Are they agricultural produce? Or are they to come in under "cattle, sheep and pigs"? What about grass-letting and the sale of farms and small holdings? Are those transactions to have no protection under this Bill? The Amendment is a very loosely worded and, if I may say so, a very casual Amendment, which will have a 107 very bad effect on the Bill, in fact, will absolutely nullify it. Therefore I hope the Committee will not accept it.

Colonel Sir ARTHUR HOLBROOK: I certainly should not support any Amendment to limit the scope of this Bill. Representing an agricultural constituency, I realise that this Bill will in many respects be an advantage to agriculturists. In moving his Amendment the hon. Member quoted an extremely bad case of fraud which could not be dealt with under this Bill. He defeated his own case by the very argument he put forward. As I said on a former occasion, one of the most striking instances of the knock-out is seen in connection with sales of Government stores At every dockyard in this country surplus stores are sold by auction, but never a sale takes place without a deliberate system of fraud on the taxpayers, who are deprived of the real value of the goods by this system of the knock-out. That is a thing I should like to see checked; and I should also like to put a stop to the practice referred to by the hon. Member. It is well known that in connection with sales in bankruptcy a certain number of dealers get together and things are knocked down at ridiculous prices, such as the instance he quoted of goods worth £4,000 or £5,000 being sold for £250. Surely the Bill gives the very means of dealing with frauds of that kind: and I feel certain that after having put forward an argument so detrimental to his own proposal the hon. Member will see his way to withdraw the Amendment.

Mr. SCURR: My point is that the Bill does not cover these things. I have said that if the promoters would accept the new Clauses I have put down there would be no need for this Amendment, but if they are not to be accepted I would limit the Bill to agriculture, because I feel it does not deal with the very instances I have quoted.

Amendment negatived.

Clause, as amended, ordered to stand part of the Bill.

NEW CLAUSE.
—(Agreements not to bid.)

"Where any persons who, in the normal course of their business, attend auctions for the purchasing of goods for resale enter 108 into an agreement or understanding whereby the parties to the agreement or understanding shall abstain from bidding against each other they shall be guilty of an offence under this Act and shall be liable to the penalties prescribed in Section one."—[Mr. Scurr.

Brought up, and read the First time.

Mr. SCURR: I beg to move, "That the Clause be read a Second time." Hon. Members opposite have already heard my arguments on this Clause, and therefore I shall not repeat them. The Clause deals with the very instances to which I have referred.

Major McLEAN: I hope the Committee will not accept this new Clause, which would, in effect, make criminal every arrangement such as we discussed on Clause 1, which we were of opinion ought not to be made criminal. Suppose two men require only half a bullock each and they agree between themselves that one only of them shall bid, and that afterwards each will take half of the bullock. This Clause would make that a criminal offence. We purposely cut down Clause 1 as it stood in the Bill which passed Second Reading so as to exclude transactions of this kind, now the hon. Member wants to reopen that issue.

Mr. ALEXANDER: On this occasion I find myself unable to support my hon. Friend the Member for Mile End (Mr. Scurr). I can quite see what was in his mind when he put down the new-Clause. What he believes is that it will be almost impossible for this Bill to achieve the object which the promoters have in view, and therefore he wants to make it very much stronger; but the knock out arrangement in connection, say with a Government sale cannot be brought within the provisions of the Bill as it is now. People who are engaged "in the normal course of their business" in attending sales of that sort will take care to make no agreement. They will change their practice and not do the knock-out at the particular pub which was known to be their haunt and where they would be traced. They will go on with the practice, but without an agreement, simply acting as friends at a sale. So far from your having achieved the object of preventing the vendor of the stuff getting for his goods what is really a fraudulent price, the practice will go 109 on as before, under methods which will be adjusted to meet the new circumstances. If we are to deal with abuses of this kind we ought at least to have watertight legislation. As I am against this Bill as a Bill I cannot agree with my hon. Friend for putting down this new Clause, though I can quite see what he had in mind in bringing it forward. It would be far better to have an Act of Parliament passed giving authority to a responsible Government Department to take proceedings against any one who is really acting in restraint of trade and in a fraudulent way. Then we should be able to deal with all abuses in a manner which would prevent any serious evasion.

Lieut.-Colonel GADIE: I hope there will be no question of adopting this new Clause. May I ask the proposer to look at the first two lines of it: "Where any persons who, in the normal course of their business, attend auctions for the purchasing of goods for resale enter into an agreement or understanding." Except in the case of cattle and a few things of that kind, five times out of six what is bought at an auction is bought for resale, and by passing this Clause we should be doing away with auctions altogether. If a man buys a row of houses five times out of six he is ready and willing to sell and it is part of his business; and we ought not so to tie up the proceedings that no auction can take place. A big estate may be put up for sale, and three or four men may legitimately form a little company to buy it; and here again it is 10 to 1 that most of the property will be bought for resale.

Mr. SCURR: The hon. and gallant Member opposite has now adopted a somewhat different argument from the line he took on the definition of a dealer. These words are not my words, but words I have taken from the promoters in connection with the definition of a dealer. But, after all, it is not my business to help people with legislation with which I am not over enamoured. I have been endeavouring to help them to make their Bill do exactly what it is they want to do. They think they will achieve their object with the Clauses they have already put forward, but they will find themselves very bitterly mistaken, and in a year or two Parliament will again have to deal with this evil. In the circumstances I will not press the Clause, because I have no real desire to help the promoters.

110

Sir A. HOLBROOK: Is the hon. Gentleman withdrawing the other two new Clauses—(Agreement for division of surplus price) and (Right to recover)—which he has put down? I should be sorry if the second and third of those Clauses were withdrawn, because I think they strengthen the Bill.

Mr. G. HARVEY: I think the essence of the whole Bill is in the second of the two proposed new Clauses.

Mr. SCURR: Then I will move the second one.

Motion and Clause, by leave, withdrawn.

NEW CLAUSE.
—(Agreement for division of surplus price.)

"Where any persons who, in the normal course of their business, enter into an agreement or understanding whereby goods purchased by any one of them, are afterwards auctioned or sold to one or more parties to the agreement or understanding at a price higher than that realised at the auction and the surplus price realised divided between the parties to the agreement or understanding, they shall be guilty of an offence under this Act, and shall be liable to the penalties prescribed in Section one."—[Mr. Scurr.]

Brought up, and read the First time.

Mr. SCURR: I beg to move, "That the Clause be read a Second Time."

Major McLEAN: I think this Clause puts into different language a provision which we have already inserted in Clause 1. It is only putting the same thing in different language, and I hope the Committee will reject this alternative.

Question, "That the Clause be read a Second time," put, and negatived.

TITLE.

A Bill to render illegal certain agreements as to bidding at auctions.

Lord FERMOY: I beg to move to leave out the words "as to" and to insert instead thereof the words "and transactions affecting." The reason for this Amendment is that the title does not now cover what the Bill contains. As a result of the alterations made the Bill now deals not only with agreements but with knock outs and we must have a wider word, such as "transactions."

111

Mr. ALEXANDER: I really feel very-sorry for the Noble Lord, who apparently has been made the unwilling and unknowing instrument for the introduction of this Bill. When he comes to deal with what is perhaps the most vital Amendment which has been put before the Committee he seems to have very little knowledge about it and very little to say about it. We are asked here to amend very considerably the title of a Bill which on Second Heading had very great difficulty in securing the requisite numbers to enforce the closure and so enable the Motion for Second Heading to be put. By altering the title of a Bill in this way we are, in my judgment, abusing the privilege given to private Members of introducing legislation of an important character. As a rule hon. Members enjoy the Friday Debates on Private Members' Bills in which, free from the restraint of Government interference, they can express themselves freely on problems which perplex the community. If the privilege of introducing legislation is going to be abused by a Bill being almost completely altered in Committee, with the title itself altered in order to cover all those alterations, we shall be having proposals for the appointment of a Select Committee to inquire into the necessity for a change in the procedure with regard to private Members' legislation. It is very unfortunate, though I know we cannot help it, that this discussion on the title of the Bill must take place after the discussion of the Amendments to the Bill. If we could have had a detailed Debate at the beginning of the Committee proceedings as to the course adopted by the promoters of the Bill, it is very likely we should have had a different result. In that case, we should have had a different result of our deliberations. The promoters must clearly understand that the procedure which they have adopted makes it incumbent upon us, when this Bill is reported to the House, to take all possible steps to pi event it getting a passage with its amended title because we do not think that is a practice which we should encourage. I want to say quite frankly that the Bill, as now produced, not merely by the promoters, but by the expert draftsmen of the Home Office, is no longer a private Bill of which hon. Members may feel proud, but it is really a Bill which is the produc- 112 tion of the Home Office. I do not know whether the Home Office expect to be forgiven for introducing a Measure of a specialised character like this, but it is necessary for us to guard the privileges of the House in regard to private legislation, and we shall have to oppose this Measure on other lines because of the change made in the title, and in the text of the Bill.

Mr. CONNOLLY: I do not understand why an important change of this kind should have been left until the end of the discussion.

The CHAIRMAN: It is the rule of the Committee.

Mr. CONNOLLY: I understand that it is the custom to leave such questions until the end, but this change does alter the possibilities of the whole Bill. During the whole of the discussion this morning I have had one point in mind, and although I have watched the Bill going through Clause by Clause and line by line, I found it impossible to discuss the matter I have had in mind. Now that the Bill has been altered by the insertion of the words "or transaction" and "or effected" you open the way for my point, and it certainly could have been discussed if the title of the Bill had been different. I had in mind that this Bill protects the vendors and the auctioneers, but it does not protect the buyer. How often have we seen at sales people put there to bid up the article. I have often been at sales, not of cattle, but of furniture and jewellery, where in the auction room you have decoys bidding up the price and thereby inducing a sale by fraudulent means. Under the Bill with its present title it is impossible to discuss a point of that kind, or make provision for it. Clause 1 deals with any agreement at a sale by auction not to bid at the sale in competition with any other person, but there is no provision against bidding up. If this Amendment is carried the discussion on the Bill in the House itself would be very much wider, and this will make void the discussion we have had here. It really means that fresh ground will have to be traversed in the House itself which will stultify the whole proceedings of this Committee.

The CHAIRMAN: At the very beginning of these discussions I said it would be necessary to amend the title of the Bill.

113

Mr. SCURR: I want to emphasise one point which has been made by the hon. Member for East Newcastle (Mr. Connolly) in regard to the widening of the title of the Bill. We shall have to widen the title on account of the Amendments which have been made in the Bill itself, and that widening opens out a vast vista of Amendments which can be moved on all sorts of transactions concerning bidding at auctions. I think it is only right that we should tell the promoters that particularly in regard to the protection of the purchaser we shall have to move Amendments on the Report Stage so that the House itself may be able to give a judgment on these matters. We have said all through that the Bill is not so objectionable now as it was when first introduced. It still requires considerable improvement, and I do not think the Measure, as it stands, will carry out what the promoters have in mind. On the Report Stage we shall still try to help to make this Measure into a better Bill.

Lieut.-Colonel HENEAGE: I would like to say that on the Report Stage we shall be glad to consider any reasonable Amendment. I cannot, however, understand the position of the hon. Member for Hillsborough (Mr. A. V. Alexander) which I think is a totally contradictory one. The hon. Member has been trying to get the Mock Auctions Bill incorporated with this Measure, and after all

Division No. 17.] AYES.
Acland-Troyte, Lieut.-Colonel Everard, W. Lindsay Holt, Captain H. P.
Alexander, E. E. (Leyton) Fermoy, Lord Lamb, J. Q.
Bromley, J. Gadie, Lieut.-Col. Anthony Lucas-Tooth, Sir Hugh Vere
Broun-Lindsay, Major H. Graham, Fergus (Cumberland, N.) McLean, Major A.
Campbell, E. T. Harvey, G. (Lambeth, Kennington) Newton, Sir D. G. C. (Cambridge)
Colfox, Major Wm. Phillips Henderson, Capt. R. R.(Oxf'd, Henley) Nuttall, Ellis
Connolly, M. Heneage, Lieut.-Col. Arthur P. Warner, Brigadier-General W. W.
Erskine, Lord (Somerset, Weston-s-M.) Holbrook, Sir Arthur Richard Watts, Dr. T.
NOES.
Alexander, A. V. (Sheffield, Hillsbro') Williams, Dr. J. H. (Lianelly) Windsor, Walter
Scurr, John

Title, as amended, agreed to.

Bill, as amended, ordered reported to the House.

114

that is entirely in keeping with the whole of his attitude in opposing this Bill. If the hon. Member will allow this alteration of the title to pass without a Division, it will be a very gracious act on his part.

Mr. ALEXANDER: The hon. Member has quite misunderstood my attitude. The promoters of the Bill, having decided to widen the title, there would have been a saving of much debate if they had also agreed to widen the provisions of the Bill to enable persons who need protection under it to secure that protection.

Lieut.-Colonel HENEAGE: Then you want the Bill made still wider?

Mr. ALEXANDER: Yes, in order to protect the purchaser, and we ask that the operation of the Bill should be delayed so that we may consider it in connection with another Bill which is before the House. I think after this explanation that the hon. and gallant Member will see that there was nothing inconsistent in my attitude towards this Bill.

Question, "That the words proposed to be left out stand part of the Title," put, and negatived.

Question put, "That those words be there inserted."

The Committee divided: Aves, 24; Noes, 4

Lord FERMOY: I should like to thank you, Mr. Chairman, for your kindness to be and the assistance which you have given to the Committee.

Committee rose at 12.26 p.m.

115

THE FOLLOWING MEMBERS ATTENDED THE COMMITTEE:

Barnett, Major Sir Richard (Chairman)

Acland-Troyte, Lieut.-Colonel

Alexander, Mr. Ernest

Alexander, Mr. A. V.

Bromley, Mr.

Broun-Lindsay, Major

Campbell, Mr.

Colfox, Major

Connolly, Mr.

Erskine, Lord

Everard, Mr.

Fermoy, Lord

Gadie, Lieut.-Colonel

Graham, Captain Fergus

Harvey, Mr. George

Henderson, Captain Robert

Heneage, Lieut.-Colonel

Holbrook, Colonel Sir Arthur

Holt, Captain

Jones, Mr. Haydn

Lamb, Mr.

Lawrence, Miss

Lucas-Tooth, Sir Hugh

McLean, Major Alan

Newton, Sir Douglas

Nuttall, Mr.

Scurr, Mr.

Warner, Brigadier-General

Watts, Dr.

Williams, Mr. John

Windsor, Mr.

116