Prison Capacity Strategy

Lord Hacking Excerpts

Tuesday 17th December 2024 Lords Chamber

[Lord Leong (Lab)]

My Lords, the noble Lord was not present at the start of the debate and therefore, according to the Companion, should not be speaking.

[Lord Hacking (Lab)]

Go on, let him speak.

[Lord Leong (Lab)]

No.

Arbitration Bill [HL]

Lord Hacking Excerpts

3rd reading
Wednesday 6th November 2024 Lords Chamber

[Lord Thomas of Cwmgiedd (CB)]

My Lords, I will briefly add to the thanks, with one exception, that the Minister gave this morning. I give particular thanks to Professor Sarah Green and to the clerk of the Special Public Bill Committee, Joey Topping, who, in the short timescale into which everything had to be compressed, did an outstanding job.

I thank the current Leader of the House and Chief Whip for getting this back when we did not get it through last time, despite their enormous efforts. They really deserve immense commendation, as does the Minister, for having put up with lawyers seeking to build perfection on perfection—something that I am sure many in this House feel inappropriate. I also thank the noble and learned Lord, Lord Bellamy, who really smoothed over some of those difficulties but did not quite get the time for matters I suspect he did not even contemplate, bringing this so speedily to a conclusion.

I will make two more general points. First, as I did not have the opportunity to thank the Senior Deputy Speaker and Duncan Sagar for getting us a bit more time in the Special Public Bill Committee—because the matter moved so quickly—if it is permissible under the rules of the House, I express on everyone’s behalf our thanks for the small change to the procedure. It should make a huge difference, because the more time there is for clever lawyers to think of points in the committee, the speedier it is to get the Bill through the House—something I hope will appeal to the business managers.

Secondly, I have a hope for the future. This morning has reminded us, if we needed any reminding, of the need to remain highly competitive. This is a good day for England, Wales and Northern Ireland—I leave Scotland out because it has its own system. We have brought our law up to date. We must find a means of doing this very rapidly, as we must keep English law— I say English law deliberately—attractive and at the forefront of use internationally, for the benefit of our whole economy.

[Lord Hacking (Lab)]

My Lords, I give personal thanks to the Minister for his very kind words to me and more general thanks to the Government for pressing forward with this Arbitration Bill. It is very befitting that the Government should have championed this Bill through, as they are at the moment, because it was a Labour Government 46 years ago who brought forward the arbitration reform that brought about the 1979 Act.

I join other noble Lords in thanking the prominent members of the Special Public Bill Committee and the prominent Members who took part in debate in this Chamber for all their contributions. I also thank the Ministers, the noble and learned Lord, Lord Bellamy, and—I keep calling him my learned friend—my noble friend Lord Ponsonby. Special thanks to the noble and learned Lord, Lord Thomas, who quite excellently presided over the Special Public Bill Committee, and to all the supporting officials.

Particular thanks should also go to the noble Lord, Lord Wolfson, and I am sorry he is not here to receive them. When he was the Minister, it was he who referred the arbitration issues to the Law Commission. That really was the beginning of the recent story on the Arbitration Bill.

This Bill is not as fundamental as the 1979 or 1996 Acts, but it deals with some very important issues. Perhaps the most important is Clause 7, giving power to arbitral tribunals to make summary awards. Those of us who practise in the courts—I am looking across the House at the moment—are well familiar with Order 14 proceedings, and this introduces into the arbitration world the Order 14 summary judgments.

It also clears up issues relating to the seat of the arbitration, arising after the unfortunate division in the Supreme Court in the Enka Insaat case, with two Supreme Court judges on one side and three on the other. I would have preferred new Section 6A(2) not to have been included, because I believe it complicates that issue, but none the less it is there, and I am very happy to support the Bill in that condition.

However, there is unfinished business. I suggest that the corruption issue should have further consideration. We know that the ICC has a commission on this and we must wait to hear what it says, but it is certainly a matter that needs further attention.

Other matters should have consideration, including expedited hearings and dealing with the length of written submissions, which sometimes stretch over 100 or 200 pages and argue every point under the sun. There is also the use of third-party funding and the question of what disclosures should be made, as well as the power to order parties into mediation, which is used successfully in litigation.

--- Later in debate ---

[Lord Leong (Lab)]

Yes, this is Third Reading.

[Lord Hacking (Lab)]

I am sorry if I am taking a little time; I hear the Deputy Chief Whip. But it is important that we should look to the future and realise that this Bill is unfinished business.

[Lord Bellamy (Con)]

My Lords, I simply associate myself, on behalf of these Benches and as the previous sponsor of this Bill in the previous Government, with the thanks that have been given to the entire team, not only to the special committee and its chair but to the civil servants who have supported the work. I thank the Government and the Minister himself, who worked very hard in the special committee, collaborated very closely with the previous Government and myself and has, as has been said, managed to bring the Bill forward again with remarkable speed. As the noble Lord, Lord Hacking, said, of course there is always unfinished business and we must look to the future, but we now have an extremely good base on which to do so.

Arbitration Bill [HL]

Lord Hacking Excerpts

Committee stage
Wednesday 11th September 2024 Lords Chamber

Moved by

[Lord Hacking]

2: Before Clause 10, insert the following new Clause—
“Award of costsIn section 61(2) of the Arbitration Act 1996 (award of costs), for the words from “costs should follow” to the end substitute “a reasonable amount of the costs of the successful party should be paid by the other party or parties, but account should be taken of costs incurred by the successful party which were unnecessary or excessive in whole or in part and which should not fall to be paid by the other party or parties.””

[Lord Hacking (Lab)]

My Lords, I will pause for a moment to allow Members of the House to leave, so that only those taking part in this Committee remain. I look to my right with some caution, because when I stood in support of my Amendment 1, I was unaware of a bank of noble and learned Lords on my right-hand side—there were three of them. Now there is only one: the noble and learned Lord, Lord Hoffman, who is sitting in his place. He told me over tea that the reason he is remaining is to oppose my next amendment. He opposed my Amendment 1 with some fierceness, and now he is staying back to oppose my next amendment.

This amendment goes back 28 years to the passage of the Arbitration Bill in 1996. I then objected to the introduction of the principle of “costs following the event”, which was in general usage in the English courts when the successful party was seeking costs against an unsuccessful party or parties. It was generally thought then that the event meant the winner won the costs, but Mr Justice Bingham—later Lord Bingham, Lord Chief Justice and then a senior Law Lord—said that was not right. It was in a case called Re: Catherine that Mr Justice Bingham said we should look at which party was responsible for what costs, and that the costs order should accordingly be made. My argument was that this obscure phraseology went against the drafting of the whole Bill.

Noble Lords who remember those days and now look at the Bill may remember that there was much praise for Mark Saville, later the noble and learned Lord, Lord Saville, who was chairman of the DAC that drafted the Bill—assisted by the secretary of that committee, the young barrister Toby Landau, and the wonderful parliamentary draftsman Geoffrey Sellars. The joy of the 1996 Act is that you can read it, passage by passage, in its clear, logical way and its clear, logical language. What a contrast that is to so many Bills that come before us—the detail and complication of many clauses cause most of us to put cold towels around our heads before we have a chance of understanding what is meant. I am not sure what the phraseology was then, in 1996, of the rules of the Supreme Court or the county court—in other words, the White Book and the Green Book—but I know now what the rules are in the new CPR. In particular, CPR rule 44.2(2)(a) says that

“the unsuccessful party will … pay the costs of the successful party”.

That is in the clearest possible language, so why should we continue to inflict upon the international community these ancient words of “costs following the event” when they are not used anywhere else? Why do international parties have to seek out the meaning? I am not suggesting that my drafting is perfect—indeed, noble Lords who have been looking at the Marshalled List will note that I made a mistake and had to re-draft—but it can all be quite simply done without any delay. For example, my drafting could be put in front of the rules committee of the Supreme Court, which can be consulted, as can the Chartered Institute of Arbitrators, the London Court of International Arbitration, the ICC and so forth. There is no cause for delay. If the drafting of my amendment is thought to be worthy of improvement, I accept that, but can the Minister—and this is the second time I am asking him, almost imploring him after the response I got to my earlier amendment—keep an open mind and not leave this strange phraseology of “follow the event” in Section 61(2) of the Arbitration Act?

[Lord Hoffmann (CB)]

My Lords, I greatly regret that the noble Lord should have cast me as his personal nemesis, particularly since it is entirely desirable that an arbitration tribunal should have the power to do what he said Lord Bingham did in the case to which he referred; that is, to distinguish between the cost of issues on which people have been successful and those on which money has been spent and on which they have been unsuccessful. However, the tribunal has such a power already.

I am sure that my friend the noble Lord, Lord Hacking, would recognise that in the end the power to award costs is entirely a matter for the discretion of the tribunal. It can take into account whether it thinks the party has spent too much or whether it has succeeded on this or that issue. All these issues can be taken into account. What it says that is salutary—this is something which attracts persons to come to London and have arbitrations under English law—is that in the ordinary way, if you have not spent too much and not lost on some issues, if you have won the case you will get your costs. That is a very attractive thing to offer to people who are about to launch an arbitration.

We have in the 1996 Act a time-honoured formula which everybody knows. They know exactly how it works and I really see no advantage in substituting a new formula, when nobody quite knows now how it is going to work.

--- Later in debate ---

[The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Ponsonby of Shulbrede) (Lab)]

My Lords, perhaps I might read out from Rule 44.2 of the CPR. It says that

“the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party; but … the court may make a different order”.

There is then considerable further guidance on the assessment of costs in the remainder of Rule 44. I can say, as a non-lawyer, that I think that is pretty clear. I note the point that the noble Lord, Lord Wolfson, made about having some sympathy with the language used, but the language which I just quoted is quite straightforward.

My noble friend Lord Hacking said that he was imploring me and he called the noble and learned Lord, Lord Hoffman, his nemesis. I might be my noble friend’s nemesis as well, because I will be arguing to reject his amendment. Of course, I thank him for tabling it. It is right that it is common practice that arbitrators already have great discretion on this matter under Section 61 of the 1996 Act. The Law Commission has made no recommendations for reform of Section 61, so we believe there is no reason for having a reform that may introduce some level of uncertainty, which we do not believe is necessary.

The previous arbitration Acts of 1889 and 1950 simply provided that costs were at the discretion of the arbitrators but the 1996 Act then provided the current default rule, which mirrored the position in the rules of the Supreme Court, which were the court rules then in force. Although the language has changed with the CPR now in force, the underlying principle is still the same. The CPR, and the RSC before them, take the view that costs should follow the event as a fair default rule. Section 61 allows arbitrators to depart from that rule as appropriate. In substance, therefore, Section 61 already allows the arbitration tribunal to award whatever costs it thinks fair.

The Law Commission received no representations from stakeholders that Section 61 was causing any difficulties in practice, and it is unusual to change the language of an Act if there is no change in principle. Indeed, it is possible that the amendment could be interpreted as a new, untested principle. In the light of this, I am grateful for the opportunity to clarify the current arrangements and would suggest that no amendment is needed. I therefore invite my noble friend to withdraw his amendment.

[Lord Hacking (Lab)]

My Lords, I intend to withdraw this amendment but perhaps I could say a short word before I do that. Of course, I have to do it because I have no support from anybody; I am doing no better than I did 28 years ago. I still say that this is unfortunate terminology and that it would be much more sensible if we brought the description of what decision should be made by the tribunal on costs into modern language, but if noble Lords like this ancient phrase of following the event they can chase around and look at Mr Justice Bingham’s judgment in Re: Catherine and so forth.

So I am in no better position than I was 28 years ago. However, there is one point I would like to make, which the noble Lord, Lord Wolfson, correctly made when he drew attention to Section 55. He could have drawn attention to Sections 62, 63, 64 or 65, because all of them deal with various provisions that are applicable to the cost issues that the tribunal faces. I respect and agree with that. I agreed with it 28 years ago and I agree with it now, but I still think it would be much nicer if we dropped this strange phraseology of costs “following the event”.

Arbitration Bill [HL]

Lord Hacking Excerpts

Committee stage
Wednesday 11th September 2024 Lords Chamber

Moved by

[Lord Hacking]

1: After Clause 4, insert the following new Clause—
“Safeguarding against fraud and corruptionIn section 33 of the Arbitration Act 1996 (general duty of the tribunal), after subsection (1)(b) insert—“(c) safeguard the arbitration proceedings against fraud and corruption.””

[Lord Hacking (Lab)]

My Lords, before I address my amendment, I would like to express to your Lordships complete support for this Bill. I had the honour to be a member of the Special Public Bill Committee, so ably chaired by the noble and learned Lord, Lord Thomas. I sat through all the hearings and then sat with my co-members of the committee throughout our deliberations.

Perhaps I can do no better in expressing my support for the Bill than to quote from the Explanatory Notes. Paragraph 6 reads as follows:

“The intent of the Bill is to further the principle found in section 1 of the Arbitration Act 1996: to obtain the fair resolution of disputes by an impartial tribunal without unnecessary delay or expense. Thereby, the aim is to fulfil the policy objective of ensuring that the Act is fit for purpose and that it continues to promote the UK as a leading destination for arbitrations”.


I now move to my amendment and, as I do so, I express thanks to my learned friend—or rather, my noble friend—the Minister. Unfortunately, he does not take the “learned” with his name, although he is very learned. I am very grateful to him for his letter to me of 15 August on the corruption issue. I have read the entire contents of that letter and express gratitude without reserve, but I am afraid to tell your Lordships—for reasons that I will now develop—that the reply in this letter is not complete.

First, we must look at the extent of corruption and I am afraid that it is bad news. There is the Nigeria case and the judgment of Mr Justice Robin Knowles on 23 October 2023; nobody in this Committee knows more about that case than the noble Lord, Lord Wolfson of Tredegar, KC, who took the role of a senior counsel throughout the long hearings before Mr Justice Knowles. The fact is, however, that in the arbitration proceedings resulting in that case, there were two very distinguished English arbitrators—former judges of the High Court—who made a very large award of $11 billion. Because of the corruption that was found by Mr Justice Robin Knowles, that very large award had to be set aside in its entirety.

Moreover, this is not the only case where corruption has evidenced itself. The charity under the title of Spotlight on Corruption has identified three recent cases in which serious corruption was found. There was the Mozambique case before the UK Supreme Court in September 2023; the Steinmetz case before the ICSID tribunal in Paris in May 2022; and the BSG case before the LCIA in April 2019. So this is a serious problem and I remind your Lordships of what I said at Second Reading: that I have had experience as an arbitrator in commodity arbitrations relating to Ukraine and Russia, where corruption was most evident, often with the bribing of officials to obtain export licences.

--- Later in debate ---

[The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Ponsonby of Shulbrede) (Lab)]

My Lords, I thank the noble Lord, Lord Wolfson, for welcoming me to my current position; I am very glad that he has 20/20 eyesight and is looking at these matters so closely. I am also thankful to my noble friend Lord Hacking for initiating this debate. He said very clearly when he introduced his amendment that he supports the Bill, and I am grateful for that. He is again raising the issue of protecting the arbitral process against corruption, and of course that is extremely important. Having considered this very carefully, the Government’s position is that our framework already provides a robust regime and that no law reform is necessary. A tribunal, like a court, must always guard against fraud and corruption, and I will explain what mitigations our existing regime already provides.

Under Section 33 of the Arbitration Act 1996, the tribunal is already under a duty to “act fairly and impartially”, and to

“adopt procedures suitable to the circumstances of the … case”.

An arbitrator who is corrupt would fail in their duties under Section 33. Furthermore, the arbitrator’s appointment can be revoked by the parties under Section 23, or an arbitrator can be removed by the court under Section 24. An arbitrator who acts in bad faith loses their immunity under Section 29 and can be sued.

When arbitral proceedings are tainted by fraud or corruption in the arbitral process, any arbitral award can be challenged in court under Section 68 for serious irregularity, as indeed was successfully done in the recent case of Nigeria v P&ID, which we heard about earlier. Indeed, the reason why arbitral corruption is currently a talking point is that the court identified corruption and prevented abuse in that case. Arbitral awards can also take account of corrupt conduct and deprive a corrupt party of any arbitral award which is sought to permit fraud or corruption. It would be unenforceable as contrary to public policy under Section 81. It is possible for an arbitrator to publish their award and denounce the fraud publicly. In ruling an award to be unenforceable, the court can also publish its judgment publicly. The scheme under the 1996 Act is sufficient and has not revealed any deficiency in practice.

The Government oppose legislative reform here precisely because it is unclear what additional benefit it would provide over the current regime, which provides both parties and arbitrators with routes to challenge and address corrupt conduct, as well as duties on the arbitrator to ensure fair and proper proceedings. A new, untested measure may simply introduce uncertainty for both parties and arbitrators.

The 1996 Act and the modernising impact of this Bill are designed to ensure robust and efficient arbitral proceedings. Our framework provides this balance and well equips the tribunal and courts to deal with corruption. The Government will continue to support the sector’s efforts on arbitral corruption. We will keep track of initiatives that are under way, such as that of the ICC anti-corruption task force, to which a number of noble Lords referred, and engage with the sector to push for the swift adoption of best practices as they are developed. I hope that this explanation reassures my noble friend and that he will withdraw his amendment.

To go a little further, as noble Lords are aware the previous Government wrote to leading arbitral institutions seeking views on the mitigations that are currently in place and whether more are needed. I understand that responses were received from the Chartered Institute of Arbitrators, the International Chamber of Commerce, the London Court of International Arbitration, the London Maritime Arbitrators Association and the Grain and Feed Trade Association, in addition to the Law Society and the Bar Council.

All those institutions mentioned mitigations they had in place against corrupt conduct. None expressed support for amending the Arbitration Bill to strengthen anti-corruption. In addition, concerns were raised that a one-size-fits-all approach would be ineffective and risk unintended consequences. Nigeria v P&ID was raised as a highly unusual case where the court effectively performed its proper role in setting aside the award. Where a role was suggested for the Government, it was in ensuring that the courts continue to be equipped to provide checks in cases put before them, as they did in the Nigeria case, and to engage in discussions with the sector and promote its work combating corruption.

The noble and learned Lords, Lord Bellamy and Lord Thomas, and the noble Lord, Lord Beith, raised the issue of the letters and whether they could be published. I am unable to share those letters. The noble and learned Lord, Lord Bellamy, can see the letters that were responded to when he was a Minister, but they were written specifically to him in that role. I would not necessarily be able to see those letters, which would create a difficult situation. I understand that a couple of letters came in when the new Government were formed. But I can say with complete confidence that the substance of those letters was explained and explored within the letter that I wrote to the noble and learned Lord, Lord Bellamy, which is in the public domain. I am confident that if I was wrong somehow in asserting that the substance was inaccurate, those various bodies would be able to draw that to my attention. I am confident that the substance of the letter I wrote on 15 August is completely accurate. I hope that noble Lords will accept that.

A number of noble Lords spoke of their reasons for opposing my noble friend’s amendment. They said that it might well be duplicative, unnecessary and problematic in various ways, which they explored. I have to say that I agree with the noble Lords who made those points.

In closing on one point, the noble Lord, Lord Wolfson, asked about relevant arbitral bodies being given a nudge regarding corruption. They are of course perfectly able to do that. It would be beneficial, and maybe they should remind themselves that they have that responsibility to give a nudge if they suspect corruption in particular cases. So, having said all that, I ask my noble friend to withdraw his amendment.

[Lord Hacking (Lab)]

My Lords, it is my intention to withdraw my amendment, but perhaps I could say just a few words after a fairly long debate on it. First, I thank those noble Lords—there were several—who accepted the principle that I sought to express. It was nice to have that support but, as was very clear, not one noble Lord accepted my amendment. Therefore, I am not exactly in a strong position to press it now, or indeed on Report.

I did not realise when I cited three cases put before us by Spotlight on Corruption that the noble Lord, Lord Wolfson, was counsel on every one. So he has extensive knowledge—greater than that I gave him credit for in my opening words.

One thing that has been missed in this debate—it was the first point I made—is that I wanted us, by legislation, to set out our standard. I described the first importance of my amendment as putting a flag in the ground so that the world may know that, in arbitration proceedings where England is the seat of the arbitration, we will not countenance corruption and fraud. I still think that is an important point.

I did not know when I got up to speak that there would be such a formidable line of noble and learned Lords alongside me, including the former Lord Chief Justice, who has not actually spoken but who has a devastating commitment to good argument, so I am not inviting him now to make any interventions because he will make some argument that will totally defeat what I am trying to say.

The noble and learned Lord, Lord Hoffmann, said that he thought my amendment was impractical, and of course arbitral tribunals do not have the power of investigation. The point I was making was that, at the commencement of the arbitration, the arbitral tribunal could speak to both counsel and the parties who should be present at the inaugural meeting and remind them of the seriousness of rooting out any corruption or fraud. I also point out, as a former counsel and solicitor, that when you take instruction from a client, and statements from clients’ witnesses, you have a lot of opportunity to know what is going on. So there is a role for counsel and the parties in rooting out corruption, and that is why I thought it useful to have this revision.

The noble and learned Lord, Lord Hope, said that the committee—which was so well chaired by the noble and learned Lord, Lord Thomas—had not reached any view about corruption. There was in fact a reason for that. I do not know whether the noble and learned Lord, Lord Thomas, is listening, but we received these two reports from Spotlight on Corruption at his instigation, and his view, and that of the committee, was that under the timetable we were working to, this was too big an issue for us to take on. That is why we made no pronouncement on that subject.

My Front Bench is getting a bit restless, but I am sure that there will be plenty of time to consider the next amendment. I rather get the feeling that there will be an intervention now in Committee on the Arbitration Bill and we will debate another excitement. I am withdrawing this amendment, but I hope that noble Lords have heard and agree that this is a continuing matter. I am particularly grateful to my noble friend for his promise to keep this under review—and may it continually be kept under review.

Amendment 1 withdrawn.

Arbitration Bill [HL]

Lord Hacking Excerpts

2nd reading
Tuesday 30th July 2024 Lords Chamber

[Lord Hacking (Lab)]

My Lords, I hope that I am standing up at the right moment. I have been advised by the Table, as the only Back-Bencher available to speak in this debate, that this is the moment that I am allowed to intervene as a gap speaker. Unfortunately, I am also advised that I have to keep to the strict rules of the gap and a Whip is already showing four fingers to me, which I think indicates four minutes. All I can do is to hope that the Whips will be kind, because I was a full participant in the Special Public Bill Committee on this Bill and took part in the many thorough and detailed sessions that we had within that committee.

I am going to break away for a moment to give tribute to the noble and learned Lord, Lord Thomas, who was our excellent chairman, and also to tell your Lordships that the noble and learned Lord is sad not to be here today and has asked me to express his regret for his absence.

I will therefore concentrate on the corruption issue. This has become important since the judgment of Mr Justice Robin Knowles in the Nigeria case. He gave his judgment on 23 October 2023. Suffice it to say that in that case, two very distinguished English arbitrators came to the conclusion that there should be an award of no less than $11 billion US against the Federal Republic of Nigeria. When this came before Mr Justice Robin Knowles, in a judgment lasting 140 pages, he set the whole of this large award aside on the grounds of corruption.

In the committee, we received submissions from Spotlight on Corruption but had no time to examine this important issue further. I am therefore asking the Minister to convene, before Committee, a special meeting to be attended by the Law Commission, by noble Lords who take part in the Special Public Bill Committee, and other noble Lords, to consider the issue of corruption and whether we should address that in Committee. This is a very important issue, and I cite from a distinguished international arbitrator who says:

“Corruption is today one of the greatest challenges facing international commerce and has serious detrimental effects on markets, efficiency, and public welfare”.


I know that from my own days as an international arbitrator, when I arbitrated a number of commodity cases relating to Ukraine and Russia. Corruption was evident all the time, and we had to be very careful in reaching our decision.

Of course, this can be pushed over to another day for another arbitration law reform, but they come very few and far between. There were 17 years between the 1979 and 1996 Acts, and it has now been more than 20 years since the 1996 Act, so I suggest that this should not be pushed over to another arbitration reform Bill; it should be addressed now and in committee.

--- Later in debate ---

[Lord Hacking (Lab)]

My noble friend would have heard my worry that the opportunity for arbitration reform is an opportunity that does not arise until a number of years have passed. Can he give any assurance that, as corruption is a serious issue—I think he recognises that—this Government will support this further investigation into corruption and whether any legislation relating to arbitration law should be brought in, and fairly swiftly?

[Lord Ponsonby of Shulbrede (Lab)]

We are always open-minded about addressing problems. We need to scope out the true extent of the problem, which is why I have offered to write to noble Lords about the responses that we may have received—I do not know the answer to that—to the letter written by the noble and learned Lord, Lord Bellamy, when he was the Minister concerned.

I turn to other points. The noble and learned Lord, Lord Bellamy, was very gracious to me in his opening, and I thank him for that. I certainly intend to behave as a Minister as he behaved when he was a Minister, and to consult with colleagues across the House to try to make sure that we focus on the real issues of difference between us, rather than any other matters that may distract us. I will take a leaf out of his book about how I conduct myself in trying to achieve that.

The noble and learned Lord asked about the possibility of carryover for uncontentious Bills between Parliaments. I will bring that comment to my noble friend’s attention. I do not know what the reaction will be, but it seems a sensible idea to me.

The second point the noble and learned Lord made concerned the choice of seat. I had a discussion with the noble Lord, Lord Wolfson, about this very issue, and my opening speech referred to it. I agree that we should have confidence in our judges, and perhaps some extra words can be added to the explanatory notes to reflect the position. We have undertaken to look at that.

The noble and learned Lord also raised an issue concerning Clause 13. I will have to write to him about that as well, as I am not sighted of that issue.

In conclusion, this Bill achieves a balance. It neither seeks to fix what is not broken, nor does it sell short the potential of our jurisdiction. Growth is a fundamental mission of this Government, and this Bill plays its part. I thank all noble Lords who have taken part in this short debate, and I look forward to interacting with them as the Bill progresses.

Recognition and Enforcement of Judgments (2019 Hague Convention etc.) Regulations 2024

Lord Hacking Excerpts

Friday 24th May 2024 Lords Chamber

[Lord Hope of Craighead (CB)]

My Lords, I too very much welcome this measure for various reasons, which are set out very well in the Explanatory Memorandum. Some of the features which are set out in it are the care that has been taken to consult at various stages, the response to the consultation, and working together across the various jurisdictions within the United Kingdom to achieve harmony in the way we respond to the challenge that this convention has presented us with. The result is a happy one, and I am very happy to offer my support for this measure.

I join with the noble and learned Lord, Lord Thomas of Cwmgiedd, in his remarks about the Arbitration Bill. For the reasons he has given, it is extremely important that this Bill be brought back at the earliest possible opportunity and with the least possible complication. I know that there are procedures that always have to be gone through for Law Commission Bills, but it was very thoroughly debated at all its stages. It was really ready to go and it is a great disappointment that it has been lost because of the calling of the election. I hope that all those involved can move quickly to bring the Bill back, so that we can get the benefits the noble and learned Lord has identified.

Lastly, I join with him in expressing great appreciation for all that the noble and learned Lord the Minister has done in his position on behalf of the Ministry of Justice. It has been a pleasure to work with him and we wish him well for the future.

[Lord Hacking (Lab)]

My Lords, I do not know whether my noble friend Lord Ponsonby is going to intervene, but I would just like to endorse entirely what the noble and learned Lords, Lord Thomas and Lord Hope, have just said. I speak as a member of the Public Bills Committee, which was so well chaired by the noble and learned Lord, Lord Thomas, and I hope my side of the House or the Minister’s side of the House will quickly bring back the Arbitration Bill, for all the reasons given by the two noble and learned Lords.

[Lord Sandhurst (Con)]

My Lords, I too welcome this measure, but I want to take this opportunity to echo the very generous words of praise from my noble and learned friend Lord Thomas of Cwmgiedd. My noble and learned friend Lord Bellamy has been a tremendous Minister. He has worked absolutely tirelessly under great pressure and it is no fault of his that we are losing the Arbitration Bill, which really is important. I think it is important that this point is made and it is very important that whoever wins the election understands that this Bill is important for the City of London which, whatever one’s political views, brings enormous sums of money into this county and generates a lot of tax.

In the same breath, I am also very sorry that the litigation funders Bill, which I think was effectively uncontested—although it could probably do with a minor tweak—has also been lost. I very much hope that that is brought back and sent through quickly in the autumn. That Bill is also very important for the London legal market. I am not talking about small sums here and cases in the Competition Tribunal and so on could be taken elsewhere. It is really important that they stay in the United Kingdom and that we keep our top legal services.

Arbitration Bill [HL]

Lord Hacking Excerpts

Second reading committee
Tuesday 19th December 2023 Grand Committee

[Lord Hacking (Lab)]

My Lords, I have never spoken in the Moses Room in the two years since my return to the House of Lords and I am not familiar with the procedure, so if I go wrong, I hope that our Deputy Chairman or someone else will put me right.

I am in a rather poignant position, in that I am the sole surviving parliamentarian who took part in the 1979 Bill and the 1996 Bill. That is not to say that I am the only creature still alive who was involved in that Bill, because Robert Ayling was the assistant solicitor in the Department of Trade—the 1979 Bill was taken through partly by the Lord Chancellor’s Department and partly by the Department of Trade. As far as I know, he is alive and kicking; I have not seen him for a little time. Mark Saville, now the noble and learned Lord, Lord Saville of Newdigate, played a critical part in the 1996 Act, but he had not by then arrived in the House of Lords Judicial Committee, which he did a year later, and therefore he sat on the steps of the Throne. He was a very important person, but not a parliamentarian at the time.

Of the parliamentarians of the time—if we could remember them—there was Lord Maurice Peston, who spoke for my party throughout the Arbitration Bill. He mugged up on the subject very well and was a very good participant in our debates. Lord Peter Fraser of Carmyllie was the government spokesman to take through our debates. Alas, both have departed this world, as indeed have other prominent Members of the House who took a very active part, including Lord Mustill, Lord Donaldson and Lord Roskill. So here I am as the one surviving parliamentarian. There is another name I must mention at once—Mr Toby Landau. Not only is he alive and kicking but he is here in this Room to listen to our debate. At least somebody other than me is still alive and kicking.

As I said, I am not familiar with the proceedings in the Moses Room and I am ready to be corrected at any time. I have some memories of the 1979 and 1996 Acts which I think it would be valuable for the Committee to be reminded of. Therefore, I intend to take a little time in doing so. I am aware that this is very close to the Christmas Recess. If any noble Lord, particularly one who is listed to speak, thinks that I am going on too long, I would ask him not to suffer me but to stand up and, if needs be, cut back my words.

The foundation of this Bill, and indeed the foundation of all arbitration law, goes back to the Act of 1698. The Bill in its preamble was described as:

“An Act for determining Differences by Arbitration”.


Further on in the preamble, we have the words: now this Bill is

“for promoting Trade and rendring the Awards of Arbitrators the more effectual in all Cases for the final Determination of Controversies referred to them by Merchants and Traders or others”.

This important Act of so long ago established the support that was needed for the conduct and, indeed, the encouragement of the use of, arbitration as a means of settling disputes. Right up to the present time, our statutory law should create a balance between the courts and arbitrations. It should also be promotional for the conduct of arbitration in the United Kingdom. The importance of that comes out clearly in a briefing that we have just received from the Law Society, which calculates that currently there are no fewer than 5,000 arbitrations annually, bringing an income of £2.5 billion to the economy, so it is of importance. I would suggest that what we are doing today is of importance.

I actually doubt whether 5,000 arbitrations is the right calculation, when one takes into account the numerous LMAA and GAFTA arbitrations, and other arbitrations in the commodity field. Indeed, when I headed up an action group in 2000—I have its paper here—there were then more than 3,000 LMAA arbitrations. But whatever it is, the figure is very large and, I suggest, very important.

The 1979 Act was specifically directed to two matters. One was the setting aside and annulment of these two procedures: the “case stated” procedure and the procedure for setting aside awards for errors on its face, which was also being used. It was used by parties when they were not doing very well in an arbitration and who then sought to take their arbitration to the courts to cause delay, embarrassment and difficulty to the plaintiff or complainant.

Indeed, in the debate that I opened in May 1978 in the Chamber of this House, I read a letter from the general counsel of Raytheon, the massive defence producer of weapons and the like. In that letter, the general counsel said that, because of the way in which two of the major arbitrations were being sucked into the court by the case stated procedure, he had given directions that there should not be any arbitration agreement signed by Raytheon, carrying a London arbitration jurisdiction. That is how serious it was. Thanks to Lord John Donaldson, the 1979 Act effectively got rid of both the case stated procedure and the procedure of setting awards aside on their face. It also created what I believe to be the right balance between the law courts and arbitration, and that has been continued ever since.

When I was citing the 1698 Act, I should have mentioned that were other arbitration Acts in the 19th century, one based on the MacKinnon report. There was of course the consolidating Arbitration Act 1950, but none were developing arbitrations on the foundation Arbitration Act 1698.

The big challenge for getting the 1979 Act through was to get Lord Diplock on side. A former commercial judge—I think he was the first judge of the Commercial Court—he was a man, a judge and a Lord of great influence, and if we did not get him on side, we had no hope of getting the 1979 Act through. The second great challenge in 1978-79 was to get the Government to give time and support for what became the 1979 Act. We achieved the first, getting Lord Diplock on side. We were greatly assisted by Bob Clare, who was then senior partner of the very big American law firm of Shearman & Sterling. He walked Lord Diplock round and round the lake at Selsdon Park until he managed to get his support.

The other way of getting Lord Diplock on side was achieved by Lord Donaldson in creating special categories of arbitrations—those relating to admiralty, commodity and insurance—and setting those aside, so that they were not entitled to opt out of the new arbitration process. Lord Diplock felt very deeply on the subject; he described the commodity and admiralty arbitrations as providing the water in the fountain of the development of English commercial law. That was quite an achievement on the part of Lord Donaldson. Incidentally, at that time Lord Donaldson was the senior judge in the Commercial Court, and, in the very active way that he approached matters, he set up a special committee which issued a report. That was then given accord by the Government of the day, being made into a Command Paper, which was of great influence in getting the 1979 Act.

As for getting the Government on side, we really had to thank Lord Cullen of Ashbourne, who was a retired stockbroker. I won the ballot and therefore succeeded in having the right to open a debate on the future of arbitration in London. There are a number of noble and learned Lords behind me now; at that debate, there were a number of Law Lords in front of me. Lord Diplock took part—I am just trying to remember all those who did—as did Lord Scarman and Lord Wilberforce. This somewhat surprised the Opposition Benches. They could well have replaced Lord Cullen of Ashbourne with Lord Hailsham, who, for example, was close to arbitration law and took an active part in the 1979 Act. However, they remained loyal to Lord Cullen, which meant that we received the evidence from him of the loss of £500 million in invisible earnings, which is what the loss of income to the Government was called then. That was an astounding figure—probably close to £5 billion in today’s currency. The Lord Chancellor spoke to me about it afterwards and said, “Is it really that much?” I was quite sure that it was not, but just said to him, “I think it is a very large sum of money”. He then seized upon the opportunity to push forward that Bill, because the Labour Government were not doing awfully well and he thought it would be awfully good for them to do something that was wholly friendly to the City of London.

It was given the Rolls-Royce treatment—that was the term Sir Thomas Legg gave it, from the Lord Chancellor’s Department—but it nearly got into a disaster. I am going on a little but am getting quite close to my end. We nearly got into a disaster at the end of that because the Labour Government collapsed in March 1979. We had just had the Bill go all the way through the House of Lords and it had not got near the House of Commons. As a result, there was a happy trade-off with the House of Commons through the official channels, which was how the Bill was saved.

Onward therefore to the 1996 Act: it was a rather slow process, which caused Arthur Marriott to take up an initiative. That then brought about the setting-up of what was called the departmental—

[Lord Roborough (Con)]

I give a gentle reminder to the noble Lord that there is an advisory speaking time of 15 minutes. We have time, but if there are points he wishes to make—

[Lord Hacking (Lab)]

I appreciate that, and I am not yet at 15 minutes, but there is nothing on the speakers’ list that stipulates a time of 15 minutes.

[The Deputy Chairman of Committees (Baroness Watkins of Tavistock) (CB)]

If I could clarify, it is normally expected in a Second Reading that 15 to 20 minutes is the maximum. Obviously, sometimes there are exceptions, but particularly as the noble Lord asked at the beginning for any clarification, I thought that would be helpful.

[Lord Hacking (Lab)]

Yes, I am very aware that behind me, and in other parts of this Committee Room, there may well be those who are anxious about getting away for their Christmas. I will therefore be responsive to this interjection and bring the Committee to another very important crisis—one which leads directly to what I have said about the importance of an arbitration Bill. It should not only set the right relationship between arbitration and the courts but be promotional in nature.

The departmental committee was headed up first by Lord Mustill and then by Lord Steyn. They gave up the fight with the parliamentary draftsman who was, dear lady, a very pedantic one. She produced a Bill which was enormously complicated and quite unreadable. It included, most surprisingly—Mr Toby Landau would remember this—the writ of habeas corpus. We had a meeting about it in Queen Mary College, down the Mile End Road, and there was an uproar against it. I remember Jan Paulsson, a leading international arbitrator, making scathing comments. There was a skeleton hang-up and what we should therefore be grateful for, and what I would like to record, is that the noble and learned Lord, Lord Saville, and Mr Toby Landau started all over again. That is the product we have now in the 1996 Act.

The important thing about what we are doing now is that this is a wholly readable Bill. It does not have a whole lot of parliamentary junk in it. It takes you all the way through each stage of the arbitration. What we should be doing now is to make quite sure that we follow in that line. I do have comments about the Bill itself, but I will leave those to another time.

--- Later in debate ---

[Lord Bellamy (Con)]

However, this is an area where Governments, the profession and practitioners are constantly aware of the need for London to be competitive, fair, open and transparent and to prosper. As the years pass, this will be reviewed over time to ensure that London remains competitive by the natural play of market forces.

I think I have covered the main points raised. I thank all noble Lords for their contributions.

[Lord Hacking (Lab)]

Could I draw the Minister’s attention to Section 61 of the 1996 Act, which the Law Commission has not pronounced upon? This is the section on the power of the arbitrators to award costs, and how they should do so. Section 61(2) says that

“the tribunal shall award costs on the general principle that costs should follow the event”.

That is the regular jargon used in cases conducted before our law courts. At the very end of the case, the winning party gets up and asks the judge to award costs following the event—namely, that that party has won and therefore the other party should pay all the costs. That goes to the point that I was making that this should be a promotional Act, attractive to those from overseas—and how are those overseas persons meant to know or understand what

“costs should follow the event”

means?

It is more complicated than that. This came out in two cases, both under the jurisdiction of the wonderful Law Lord, Tom Bingham. When he was a mere Mr Justice, he did the case of “Catherine” in 1982—and then, when he was the Lord Justice of Appeal, he presided on the Norwegian Cruise case of April 1988. In both those cases, he did not follow the normal rule of costs following the event, because in both those cases the winning party had taken up excessive time on matters that it lost in the dispute. Therefore, it is not so simple as costs following the event and the loser paying.

What I suggest concerning this clause is that we take the opportunity during the passage of the Bill to remove that phrase and leave it as a simple judgment of the arbitrator or arbitrators—what is the fair order on costs that that they should make.

[Lord Bellamy (Con)]

My Lords, I thank the noble Lord, Lord Hacking, for that intervention. As far as I know, the Law Commission did not consider that specific question, so I am not entirely sure, as of now when I am on my feet, to what extent we should widen the debate in the context of this particular Bill. But I shall take his point back and further consider it, and see whether the Government have a position on the point that he very strongly makes.

Arbitration Bill [HL]

Lord Hacking Excerpts

Monday 4th December 2023 Lords Chamber

[Lord Bellamy]

That the Bill be referred to a Second Reading Committee.

[Lord Hacking (Lab)]

My Lords, long ago, I brought the Bill that became the Arbitration Act 1979 to the House and I then played a very active part in the 1996 Act. It is an area in which I have specialised. I would be very grateful if the Minister could give some guidance as to what exactly he means by his Motion to refer the Bill to a Second Reading Committee. I am mystified.

[The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Bellamy) (Con)]

My Lords, as I understand it, this Bill will follow Law Commission Bill procedure, which is a special procedure whereby, in essence, we simply adopt a recommendation by the Law Commission. The next stage is to refer the Bill to a Second Reading Committee, which will take place in due course in the Moses Room; I think it is due on 19 December. Once there has been a Second Reading of the Bill, a specialist Committee will examine it. I am sure that the noble Lord’s membership of that Committee would be something we would all look forward to.

[Lord Hacking (Lab)]

I am very grateful to the Minister.

Motion agreed.

King’s Speech

Lord Hacking Excerpts

Wednesday 8th November 2023 Lords Chamber

[Lord Hacking (Lab)]

My Lords, I find the news of Lord Judge’s death most painful. I started my career as a barrister with Lord Judge—we were fellow pupil barristers in the same chambers—and I have known and admired him ever since.

On Thursday 14 October 1976, Lord Hailsham, the father of the current noble Viscount, Lord Hailsham, gave the Richard Dimbleby memorial lecture entitled “Elective Dictatorship”. I thought then that Lord Hailsham was right, and I think now, 50 years on, he was more than right. As Lord Hailsham argued, the Executive, when they wish, just control the legislature and not, as it should be, the other way round. Importantly, Lord Hailsham identified the cause as the

“continuous enlargement in the scale and range of government”,

with the result that more and more of the Government’s party, particularly in the House of Commons, is being taken into government, thereby strengthening the Government’s powers over the legislature.

I can give a personal example. My grandfather, in the House of Commons in the 1920s and 1930s, was a Parliamentary Under-Secretary of State in the Home Office. At that time, the only other political appointment in the Home Office was the Home Secretary. Take the position now: there is the Home Secretary, three Ministers of State, three Parliamentary Under-Secretaries of State and seven political appointments. The assumption is that this has happened in all the major departments of state, and the Government have continued, and are continuing, to extend their powers through the creation of one government agency after another.

In the current Parliament, there have been Bills, though not many, in which the Back-Benchers in both Houses of Parliament have been able to participate, to the benefit of the Bill, which is welcome—but not so with other Bills. Take, for example, the Illegal Migration Bill. This House worked very hard throughout the passage of the Bill, and when, on 12 July at well past midnight, this House was considering Commons amendments to it, we voted by significant majorities—by 60 votes or more in nine Divisions—for critical and important changes. What happened when the Bill got back to the House of Commons? My colleague in the Commons, Jess Phillips, wrote about it in the New Statesman on 21 July:

“Round and round and round we walked, voting on the House of Lords’ amendments to the Illegal Migration Bill. The first session took three and a half hours, the second two hours. It really is something to spend so much time losing votes … during these past few weeks of parliament, the farce has been real”.


I think all of us should find this very disturbing. It was further disturbing when we were compelled to pass this Bill, which most bizarrely contained provisions the Court of Appeal had declared to be unlawful. If the Supreme Court agrees with the Court of Appeal, there will remain among our statutes an unlawful statute. Perhaps its true name is the “illegal Migration Bill”.

This was not the only Bill which, in the last Parliament, fell in the House of Commons to the dictate of the Government—I refer to the retained EU law Bill. It is true that we are not an elected Chamber, but we are the only Chamber in Parliament that can place some restraint on the Government. In neither of the two Bills I cited did the Government have any electoral or other mandate. In the King’s Speech, the Government state that they intend to

“deliver on the Illegal Migration Act”.

What does this mean? I can only urge the Government heretofore not to use dictatorial powers and urge this House to look after democracy when any Government, of any day and of whatever persuasion, is patently not doing so.

I end my words by addressing the two Ministers, the noble and learned Lord, Lord Bellamy, and the noble Lord, Lord Sharpe of Epsom. The Lord Privy Seal, in his excellent speech yesterday, spoke about the friendliness of this House. I have now been rather unfriendly towards the Government of which the two Ministers are members. I hope that they will accept that I was not seeking to be unfriendly to them—they are good and respected Ministers. Their problem is that they are having to answer for the extremists in their party in the other place. We should give our commiserations to both of them.

Illegal Migration Bill

Lord Hacking Excerpts

Report stage
Monday 3rd July 2023 Lords Chamber

[Baroness Hamwee (LD)]

My Lords, my noble friend Lady Ludford has put her name to the amendment in the name of the noble Lord, Lord Bach, which he explained very fully, and these Benches support. One often hears that immigration law is too complex for non-lawyers to understand—I have long held the view that it should not be—but, frankly, it is too complex for many lawyers as well. You need to be a specialist, and that is recognised by the system, but one still hears some horror stories.

The realities of legal advice for anyone in detention in the immigration system have long been bleak. There may be advice sessions but they are 30 minutes long, and it takes a long time for the client to be brought to meet the solicitor, which eats into the 30 minutes. Even with the most articulate client, it can take quite a long time to take instructions. I was a practising solicitor for many years and this cohort, as the noble Lord, Lord Carlile, said, consists of individuals whose English may be inadequate. Interpretation is therefore required, which is cumbersome and difficult for everyone. In any event, they have a story that takes support to tell, and that requires a lot in the telling.

Given the relentless speed of the processes under the Bill, this amendment is very necessary. The Government have recognised that legal aid has a place here, given what they have done so far in the Bill and the consultation on the rates. Raising concerns about legal aid became even more relevant with last week’s impact assessment, which drew attention to the problems of accessing legal aid and legal aid services, especially outside London and the south-east. We are very happy to support this amendment.

[Lord Hacking (Lab)]

My Lords, I am a Member of this House whose memory of legal aid probably goes back to before others were here. I was called to the Bar in 1963 and took an active part in legal aid, being not only a recipient of legal aid cases but sitting on legal aid committees. I view it as one of the great social achievements of the Labour Government ending in 1951, and it has been a matter of great sadness that its extent and benefit has been so diminished over the years.

We have here a very important need for legal aid. Most if not all of those needing legal aid will not be able to speak English, will have no knowledge of English law and will be left isolated without that assistance. For that reason, I strongly support the amendment of my noble friend Lord Bach—although, most regrettably, he is not putting it to a Division.

[Baroness Lawlor (Con)]

My Lords, I am glad to follow the noble Lord, Lord Hacking. I think the 1949 measure was a good measure following the Rushcliffe report. It had cross-party support then, and legal aid continues to have cross-party support.

I agree in principle with the noble Lord, Lord Bach, that it would be a very good thing for us to be able to revisit the legal aid budget and ensure that many of the cuts, both to scope and to litigants, could be reviewed with a view to being more generous and trying to revisit the consequences of both the 1999 and the 2012 Acts. I am with the noble Lord there.

However, because we have seen such cuts right across the board and a reduction in scope across the board, I have concerns about this particular amendment for these cases unless and until we can grant similar support to many of the cases in this country that are left without support as a result of what has happened over more than 20 years. I know that noble Lords would say that this is a different case, but many of these cases are claims of great merit, but Governments have to make decisions. For my money, I would prefer to have a fair redistribution of the legal aid budget between people who have been cut out of it—many of whom would have been eligible right throughout the 20th century—and other cases that noble Lords have mentioned.