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Baroness Hamwee: My Lords, my name is also down to the amendment tabled by the noble and learned Lord, Lord Archer. The House should be truly grateful to him. I was quite staggered when points he made at earlier stages of the Bill led to the revelations--I do not think that is expressing it too strongly--as to the implications of the costs regime for the tribunal. When I first read the Bill I did not realise this matter needed to be prodded in the way in which the noble and learned Lord has done.

Justice deferred is justice denied. Justice denied through cost is just as much a denial as failing to provide a tribunal to deal with the matter. As the noble Lord, Lord Dubs, said, this is a major issue. It should not be dealt with in connection with one tribunal, singling out those proceedings from others, "slipped in" (which is not an inaccurate description) in a Bill such as this.

If we are moving towards a regime of charging for justice, as these provisions seem to suggest, it is an idea that I believe the House would wish to discuss as a matter of principle. It would not wish the regime to be applied to this one tribunal and this one unfortunate group of people, who run the risk of being denied justice because they happen to be seeking it in a particular area.

I hesitate to accuse your Lordships of cynicism, but it would be cynical for this House to approve the passage of a Bill providing for rights while at the same time making those rights inaccessible as a result of the costs of achieving them.

Viscount Bledisloe: My Lords, Clause 83 of the Housing Bill is hardly the place one would expect to find a radical amendment to the judicial philosophy of this country. Nonetheless, by inserting new Section 31B into the Landlord and Tenant Act, the clause as drafted requires fees to be fixed so that those who applied to the leasehold valuation tribunal to have their services adjusted shall pay the entire cost of that service: buildings, staff, chairman and, as the noble Lord, Lord Lucas, charmingly put it, down to the milk for the office cat. By means of a very modest amendment tabled today, the Government now graciously say that the cost will not be more than that; that is, they will take only 99 per cent. of the cost of the milk for the office cat and not 100 per cent. of it.

These proposals are a radical departure from the entire philosophy on which this country has been run for a very long time. The House should be very grateful to the noble and learned Lord, Lord Archer of Sandwell, for discovering this poison pill tucked away in this remote provision.

Until today, every citizen has had access to the entire judicial system, courts, tribunals, etc., on payment of only a modest fee. But for some reason those who wish to challenge their service charges will, according to the Government, have to do something entirely different. According to the noble Lord, Lord Lucas, they will have to pay up to £2,000 a day for the hearing, and do so in advance.

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By contrast, under what I understand to be the rules for county court fees, such applicants would have to pay £115 in total, however many days a hearing ran. The rise from £115 to £2,000 per day is part of a measure proposed by the Government as a cost-effective method of resolving disputes on service charges. The main reason why I am concerned does not relate to the effect on the unfortunate individual leaseholders, but to the whole principle and nature of this provision, tucked away in a remote clause of the Bill.

We are told that the Government wish to have an entire system of "full cost justice". So be it. If that is what they want, let them introduce a Bill to that effect. Let us see and debate the various consequences and safeguards; and let us hear the considered views of judges, lawyers, litigants, etc. Let us tackle the problem face on, in its entirety.

I suggest to the House that it is unacceptable to make this system of full-cost justice apply to only one class of litigant and to do so by this remote clause. As far as I am aware, not one of the judicial Members of this House was aware of this clause until after the Report stage last Thursday. The leading judges had neither been consulted nor had they had any opportunity to comment on this radical departure from our traditional principles. Therefore, for my part I make no apologies for raising this important matter at Third Reading.

In the Official Report of 10th July (at col. 348), in replying to the debate, the noble Lord, Lord Lucas, said,


    "there is no overwhelming case for a disputes procedure of this kind between landlord and tenant to be a burden on taxpayers".
With the greatest respect to the noble Lord, he appeared to be entirely unaware that every other public disputes procedure of any kind whatsoever is just that. It is paid for by the taxpayer and not by the individual litigant.

In his very courteous letter, for which I thank him, the noble Lord suggested that for the county court the fees currently received covered 80 per cent. of its costs. But with respect to him, that is a complete red herring. I am not sure how his figures are calculated, but if they are correct that is because a vast number of purely routine debt-collecting summonses are issued for a fee and involve no hearing at all because, on receipt of the summons, the defendant pays up. There is no relevance here. What is plain is that the present fee in the county court for a case which goes to hearing (£115 in total) bears no resemblance to the actual cost of the service. There is no judicial service where the litigant has to pay the full cost of his hearing.

On the last occasion the noble Lord, Lord Lucas, was--and, from his letter, I gather he still is--entirely unable to explain why this type of dispute alone is singled out for this treatment. It is not apparent to me why tenants who want their service charges reduced are to pay full costs while multinational companies in commercial or patent disputes, or wealthy citizens seeking to devise ingenious tax-avoidance schemes, merely pay county court fees of a very modest amount while the remainder is paid by the taxpayer. The distinction does not seem self-apparent for that reason. My suggestion to the House is that this is an entirely

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unacceptable derogation by a backdoor from a general principle of great importance. If it is to be altered it must be altered openly, after full debate and upon a rational and coherent basis.

I suggest that Amendment No. 20 in my name will achieve that. It restricts fees to the same level as those payable in the county court. Unless, in the Government's normal way, they suggest that that is defective because there will not be comparable fees in the county court, it allows the Secretary of State to decide what, in his opinion, those fees would have been so that he does not have the problem that there is no exact analogy. I do not believe that the drafting point will do any good.

If my amendment is accepted, for the moment a tenant applicant will pay no more than he would have paid in the county court prior to this so-called cost-effective exercise. But if at a later date the Government get through a general Bill which says that there shall be full cost justice in all courts, then, under my amendment, they will equally be able to charge those in this tribunal. I hope that the House will accept at least one or other of the amendments.

4.45 p.m.

Lord Renton: My Lords, so far I have not troubled your Lordships with any views on this Bill, but I am very much concerned about what is proposed in the part of Clause 83 we are now discussing. It would be very unfortunate if there were a great disparity between the fees charged before this tribunal, which is under discussion, and those charged in the county court. If we look further down page 57 of the Bill we see that certain cases can be transferred from the county court to the tribunal. If we look over the page we find that the question of service charges and the costs of proceedings in that regard are also under consideration as part of the jurisdiction of the tribunal.

Something more should be done than what is proposed by the Government in Amendment No. 21. That helps very little: it does not fundamentally deal with the problem. We can still be left with this enormous charge. At Report stage on 10th July my noble friend Lord Lucas said that the proceedings might cost as much as £2,000 a day. It is not merely a question of proceedings concerning a whole block of flats. We may be faced with the costs of proceedings dealing with much more limited matters including service charges.

The Government must do something. The noble Viscount, Lord Bledisloe, put his case with great clarity and persuasion. I agree with what he said about the drafting of his amendment. It fits in very well with the power given to the Secretary of State under the new Section 31B of the Landlord and Tenant Act 1985.

I do not wish to labour the point, but if justice is to be done it is important that it should not cost more than is reasonable. It is not only that. We should not, by statute, introduce a great difference in the treatment of people who go before the county court and those who go before the tribunal. It would be absurd to make such a difference. The Government had a great deal of representation made to them from all parts of the House at Report stage. I hope that they have considered the

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matter carefully. Now that a workable, constructive, positive suggestion has been put forward by the noble Viscount, I hope that the Government will consider that that is the best solution to a difficult problem.


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