Chancel Repairs

Debate between Lord Ashton of Hyde and Lord Kennedy of Southwark

Thursday 15th January 2015 Grand Committee

[Lord Ashton of Hyde (Con)]

My Lords, I am grateful to my noble friend Lord Avebury for raising the issue of chancel repair liability for debate today. I am also grateful for the interesting contributions of other noble Lords who have spoken. I feel, in some ways, that the right reverend Prelate should be here, I will not say in the dock, but here with me to answer some of the speeches, which were all on the theme of changing the present situation. I listened carefully to the concerns expressed about chancel repair liability and I am sure that the Ministry of Justice will consider them in detail, but I must make clear—I trust that this will not come as too much of a shock to noble Lords, except, perhaps, to the noble Lord, Lord Kennedy—that the Government have no plans to change the law at present. None the less, it is because we take the concerns seriously that we are keeping the situation under review.

I do not have time to go through the long history of chancel repair liability. In fact, my noble friend Lord Avebury has dealt with that admirably, as have other noble Lords. The Law Commission has considered the liability a number of times since the 1960s. The present legal position is that chancel repair liability is an ancient but valid right that enables the owner, who, in England, is usually the PCC, to enforce the liability. This right can play an important part in the finances of the 5,000 or so churches with the benefit of the liability. In earlier times, the main problem was that the liability was sometimes difficult, if not impossible, for a prospective buyer to discover. Now, following the removal of its status as an overriding interest in October 2013, its existence is readily discoverable. This is a major improvement, as my noble friend Lady Wilcox said.

On the other hand, the unpredictability of the incidence of the liability, its open-ended size and particularly its joint and several nature, mentioned by the noble Lords, Lord Cashman and Lord Rooker, still attract criticism. It is, however, unclear how far these potential problems are causing widespread real difficulties in practice. The Ministry of Justice’s impression is that enforcement, now and for some time past, against ordinary homeowners is rare. This may be a consequence of the relatively small number of chancels, probably about 500 to 600, where the liability falls on individual property owners. It may also be because PCCs are reluctant to enforce the liability. Their wider mission may, perhaps, not be best served by imposing financial hardship on individual members of the local community. That is, however, a decision for individual PCCs, who can get advice from the church and the Charity Commission, as well as their own legal advice.

Under Section 110 of the Charities Act 2011, trustees can get reassurance from the Charity Commission that they are acting in accordance with their duties. It may also be that the level of concern about the liability has been temporarily increased by the registration. My noble friend Lady Wilcox asked how many ordinary householders are affected by this liability. We do not have the statistics indicating how many ordinary householders are affected, but the Land Registry has received about 9,000 applications for registration of notices and 160 applications for the registration of a caution against first registration. What we can be sure about is that there are enough people who may be affected to take this subject seriously.

The Government appreciate that homeowners who were unaware that their home was subject to the liability may well have been worried by the notice. The speech by the noble Lord, Lord Rooker, reminded us of the effects to real people, not just in theory, but the reality is that their legal position has not changed. The fears that were expressed leading up to the deadline of October 2013 that the registration of a notice can render a property unsaleable or unmortgageable do not seem to have materialised, nor does the market in chancel repair liability insurance seem to have disappeared. That is not to say that chancel repair liability cannot or will not cause major problems for some homeowners, but at present it is not clear that that liability is doing so in practice.

Even if reform is necessary, it may not be straightforward, as the right reverend Prelate made clear in a very measured speech. Abolition, as advocated by the noble Lords, Lord Avebury, Lord Cashman, Lord Rooker and others, would almost certainly require compensation to be paid because chancel repair liability is a property right protected by the Human Rights Act, as confirmed by the House of Lords. The sums involved in aggregate might run to hundreds of millions of pounds. The right reverend Prelate suggested that compensation is the way to abolition but he did not mention by whom. The noble Lord, Lord Kennedy of Southwark, said that that is where the Government come in.

Schemes for release, redemption or compounding might be created or present ones, as outlined in the Ecclesiastical Dilapidations Measure 1923, improved, but their cost and attractiveness to prospective users would have to be considered carefully. The noble Earl, Lord Lytton, mentioned some of the difficulties in estimating a compounded amount, taking into account the net present value for an unlimited liability stretching forever. What discount rate, for example, would one use, taking into account the average interest rate across all years forever?

I know that my noble friend Lord Avebury and other noble Lords will be disappointed that the Government are not developing any proposals for reform at present but I assure noble Lords that the Ministry of Justice will consider evidence of actual hardship or general problems that the law may cause and will keep the situation under review.

[Lord Kennedy of Southwark]

Having heard the contributions of noble Lords, in particular from the right reverend Prelate the Bishop of Derby, that is a most disappointing response from the Government and makes no attempt to deal with the issue.

[Lord Ashton of Hyde]

The problem is that nobody has come up with a simple way of how to do it, except by providing compensation, because it is a property right under the Human Rights Act. The issue is: who provides compensation to the people who own the right? We have decided that there is no necessity to do that when there is no actual example of hardship taking place at the moment. The reason that I said that we will keep it under review is that if there is evidence of actual hardship taking place, we will consider this measure.

--- Later in debate ---

[Lord Kennedy of Southwark]

Is it not possible for the Minister to say today that he would welcome discussions between his officials, the noble Lord, Lord Avebury, and the Church of England? If this could be resolved, everyone would be happier. I do not see why he cannot even offer that to the Committee.

[Lord Ashton of Hyde]

I did indicate that when it comes to dealing with the church and the National Secular Society, we would take part in discussions if required. I also made clear that if there was evidence of hardship, the Ministry of Justice would consider it. I do not think that that is unreasonable in the absence of any actual evidence of hardship at the moment. If there is evidence of hardship, we will discuss it, and of course we are always willing to talk to the noble Lord, Lord Avebury, or any other noble Lords at any time.

Legal Services Act 2007 (Approved Regulator) (No. 2) Order 2014

Debate between Lord Ashton of Hyde and Lord Kennedy of Southwark

Thursday 23rd October 2014 Grand Committee

[Lord Kennedy of Southwark (Lab)]

My Lords, I do not intend to detain the Grand Committee for very long. I agree with many of the comments that noble Lords have made so far in the debate. The Opposition fully support the proposal and endorse the reasons outlined by the Minister why it is necessary and welcome.

The Chartered Institute of Legal Executives provided me with a very helpful briefing that makes clear the benefits of the proposal, and I am grateful to them for that. I agree with the comments by the noble Lord, Lord Phillips of Sudbury, about what a good organisation CILEx is. It has done excellent work on a variety of areas, particularly on broadening the diversity of the legal profession, and I pay tribute to it for that.

Allowing CILEx to become a regulatory body in the areas of conveyancing and probate is welcome. It will help to cut bureaucracy and red tape and help to make things simple for everyone. However, it would help if the Minister could comment on the remarks made by the former Lord Chief Justice, the noble and learned Lord, Lord Judge, as referred to by the noble Lord, Lord Phillips. He expressed concern that regulatory competition would have a detrimental effect on standards, that the variation in standards between regulators was inappropriate in principle and that a variation on standards may bring about a drive to the bottom.

I also noted that the former Lord Chief Justice had one matter of concern across the board—parity of standards when one has a proliferation of regulators—and he had further concerns as to whether the instrument deals with contentious or non-contentious probate. It would be helpful if the Minister could give us his views on those points as well. Having said that, this measure helps to encourage an independent, strong, diverse and effective legal profession, and consumers will have much greater choice. That is very welcome and I am very happy to agree the order.

[Lord Ashton of Hyde]

My Lords, I thank all noble Lords who have spoken in this brief debate. It has been helpful to identify concerns and I hope that I will address them—although there did not actually seem to be that many, as far as I could understand it. I have been able to set on record why the Government have decided to designate CILEx as an approved regulator, and I am pleased to hear what I think was the universal approval of CILEx as a suitable regulator for the reserved instrument activities and probate activities.

A number of questions and points were raised. My noble friend Lady Buscombe asked about paralegals. I am not 100% sure what the definition of a paralegal is so I will write to her to ensure that I have all the details. There are currently no proposals to extend the regulation to paralegals as a group, but obviously if a paralegal wanted to undertake a reserved activity, they would need to seek authorisation from one of the approved regulators, such as CILEx, and would have to undertake the correct test to ensure that the regulator could approve them.

My noble friend Lord Phillips of Sudbury talked about the issues surrounding the Legal Services Act in the context of competition. The Act has been passed by this House. Whether or not competition will be improved—I think that most people, and certainly the Government, feel that it will—in terms of this order, which appoints CILEx as an approved regulator, I think he was happy to agree that it is a satisfactory regulator for these two extra activities.

Judicial Appointments (Amendment) Order 2014

Debate between Lord Ashton of Hyde and Lord Kennedy of Southwark

Thursday 23rd October 2014 Grand Committee

[Lord Ashton of Hyde (Con)]

My Lords, the order before us today amends the judicial appointments criteria to enable registered patent attorneys and registered trademark attorneys to be appointed persons able to review the decisions of the Intellectual Property Office as part of the appeals process. Section 10(2) of the Intellectual Property Act 2014 inserted new Section 27A in the Registered Designs Act 1949 under which the Lord Chancellor appoints an appointed person to hear appeals against decisions of the Intellectual Property Office in relation to design rights.

This instrument amends the Judicial Appointments Order 2008 to include an appointed person in the list of those offices for which registered patent attorneys and registered trademark attorneys can satisfy the judicial appointment eligibility condition. The purpose of this draft order is to support the Intellectual Property Act 2014 and its aim to introduce a quicker and more cost-effective route of appeal against design decisions of the IPO. At the moment, the route of appealing against decisions of the IPO in relation to designs is via a dedicated tribunal, which has been used only twice in the past 10 years. It offers no flexibility or route for further appeal. The Government’s aim is to have a process in place for design rights that mirrors the appeals process already in place for appeals against trademark decisions

The decisions of the IPO in relation to trademarks can be appealed to a person appointed by the Lord Chancellor—an “appointed person”—based on a recommendation of the Judicial Appointments Commission. This gives the appeal process some degree of independence from the IPO. To do this in relation to decisions on designs, the IPO has amended Section 27A of the Registered Designs Act 1949 to include similar provisions to those in the Trade Marks Act.

I will give the Committee some background. Following the Hargreaves review of intellectual property and growth, the Government have been carrying out a programme of work to determine how to improve the designs legal framework. This has resulted in changes to design legislation included within the Intellectual Property Act 2014, including those I referred to earlier in relation to determining appeals.

The Government’s aim has been to improve access to justice for businesses using the UK designs registration system by allowing them to choose a low-cost, reliable and efficient appeals route system. The changes make the system easier to understand for users of different forms of intellectual property by simplifying the appeal framework and aligning it with the trademark appeal route. This draft order seeks simply to support that aim by allowing a registered patent attorney or registered trademark attorney who holds a relevant qualification to be eligible to be a person appointed under Section 27A of the Registered Designs Act 1949.

The principles of the Intellectual Property Act 2014 have already been approved by this House. This order seeks merely to support the implementation of that Act by allowing the appointment of appointed persons to hear appeals against design decisions of the IPO. I therefore commend this draft order to the Committee and I beg to move.

[Lord Kennedy of Southwark (Lab)]

My Lords, I thank the noble Lord, Lord Ashton of Hyde, for setting out the details of the draft order. The order provides a technical amendment to the Judicial Appointments Order 2008 and will allow the Lord Chancellor to appoint registered patent attorneys and registered trademark attorneys as appointed persons, allowing them to hear appeals against decisions of the Intellectual Property Office.

The Opposition have no issues with the proposal. I have two brief questions that I hope the Minister will be able to answer. As he is aware, the majority of the provisions of the Intellectual Property Act 2014 are set to commence in April 2015. The part of the 2014 Act amended by the order enables the appointment of appointed persons who meet the new criteria. Will the Minister explain why the order is due to take effect before the Act comes into force? Why can we not just wait until the relevant legislation has come into effect? Secondly, the law in this area is highly specialised and complex. Will the Minister confirm to the Grand Committee that he has confidence that the Judicial Appointments Commission has the necessary capacity and expertise to make appointments in this area? However, I put on record the Opposition’s support for the order and look forward to the reply from the noble Lord.

[Lord Ashton of Hyde]

I thank the noble Lord, Lord Kennedy, for his questions. He first asked why we were making this change when the commencement date for the Intellectual Property Act 2014 has not passed. The order was laid before Parliament on 7 July 2014. The Department for Business, Innovation and Skills, the department with oversight for the Intellectual Property Act 2014, enacted the relevant parts in respect of the new appeals process on 15 July 2014. The statutory instrument was considered by the Joint Committee on Statutory Instruments on 16 July 2014 and by the Secondary Legislation Scrutiny Committee on 21 July 2014. The relevant parts of the Act have been put in place and this statutory instrument will allow the appeals process to be in place in time for the Intellectual Property Act commencement date of April 2015.

The other question asked by the noble Lord was whether we are confident that the Judicial Appointments Commission has capacity. The answer is yes.

I believe this to be a reasonable amendment which aims to support the Intellectual Property Act 2014 and help UK businesses. I hope that noble Lords agree with me that this is a proportionate and sensible measure.