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The Lord Chancellor moved Amendment No. 27:


On Question, amendment agreed to.

The Lord Chancellor moved Amendment No. 28:


    Page 12, line 10, after ("him") insert ("to or").

On Question, amendment agreed to.

Clause 32, as amended, agreed to.

Clause 33 [Application]:

The Lord Chancellor moved Amendment No. 29:


    Page 12, line 16, after ("provided") insert ("to or on behalf of,").

On Question, amendment agreed to.

Clause 33, as amended, agreed to.

Clauses 34 to 37 agreed to.

Clause 38 [Common investment schemes for charities etc.]:

The Lord Chancellor moved Amendment No. 30:


    Page 14, line 28, at end insert (", or having effect as if made,").

The noble and learned Lord said: With Amendment No. 30 I shall speak also to Amendment No. 32. These amendments make it clear that common investment schemes made before the relevant sections of the Charities Act 1993 came into force are also exempted from the operation of this Bill. These are schemes set up under Sections 22 and 22A of the Charities Act 1960. I beg to move.

On Question, amendment agreed to.

The Lord Chancellor moved Amendment No. 31:


    Page 14, line 29, after ("1993,") insert ("other than such a fund the trusts of which provide that property is not to be transferred to the fund except by or on behalf of a charity the trustees of which are the trustees appointed to manage the fund,").

The noble and learned Lord said: This amendment brings within the ambit of the Bill those schemes set up under Section 24 of the Charities Act 1993 known as pooling schemes, by which groups of small charities may consolidate their investments. These schemes often have no explicit powers of investment and thus the Charity Commission was of the view that there would be an advantage to bringing them within the new scheme. The words added by this amendment achieve this. I beg to move.

On Question, amendment agreed to.

The Lord Chancellor moved Amendment No. 32:


    Page 14, line 30, at end insert (", or having effect as if made,").

On Question, amendment agreed to.

Clause 38, as amended, agreed to.

Clause 39 [Interpretation]:

The Lord Chancellor moved Amendment No. 33:


    Page 15, line 5, at end insert—


(""settled land" has the same meaning as in the Settled Land Act 1925;").

7 Jun 2000 : Column CWH12

The noble and learned Lord said: This amendment merely adds the definition of settled land to Clause 39, which is the interpretation clause. I beg to move.

On Question, amendment agreed to.

Clause 39, as amended, agreed to.

Clauses 40 to 43 agreed to.

Schedule 1 [Application of duty of care]:

The Lord Chancellor moved Amendment No. 34:


    Page 17, line 6, leave out from ("or") to end of line 7 and insert ("any other power of investment, however conferred;").

The noble and learned Lord said: In moving Amendment No. 34, I shall speak also to Amendments Nos. 35, 36, 38 and 40, which have been grouped together. Each has the same effect in its place in Schedule 1. In each case, it ensures that the duty of care provided for in Clauses 1 and 2 of the Bill applies to the exercise of the trustees' powers regardless of the origin of the powers. As published, the schedule referred only to powers derived from the trust instrument. However, that overlooked the fact that trustees may derive relevant powers from other sources such as orders of the court, orders and schemes made by the Charity Commission and from legislation. That being so and the policy that the duty of care should apply to the exercise of all relevant powers, unless specifically excluded by a trust instrument, the amended wording so applies. I beg to move.

On Question, amendment agreed to.

The Lord Chancellor moved Amendments Nos. 35 and 36:


    Page 17, line 14, leave out from ("any") to end of line 15 and insert ("other power to acquire land, however conferred;").


    Page 17, line 26, leave out ("power conferred by the trust instrument") and insert ("other power, however conferred").

On Question, amendments agreed to.

The Lord Chancellor moved Amendment No. 37:


    Page 17, line 37, at end insert—


("Compounding of liabilities
. The duty of care applies to a trustee—
(a) when exercising the power under section 15 of the Trustee Act 1925 to do any of the things referred to in that section;
(b) when exercising any corresponding power, however conferred.").

The noble and learned Lord said: This amendment is made for the sake of consistency. As the Bill repeals Section 23 of the Trustee Act 1925, with its concept of good faith, and replaces it with the powers in the Bill to appoint agents, nominees and custodians, to which, of course, the duty of care applies, we have thought it sensible, for the sake of consistency, to apply the duty to Section 15 of the Act which also gives a power to trustees but, at present, relies on a test of good faith. I beg to move.

On Question, amendment agreed to.

7 Jun 2000 : Column CWH13

The Lord Chancellor moved Amendment No. 38:


    Page 17, line 42, leave out ("conferred on him by the trust instrument") and insert (", however conferred").

On Question, amendment agreed to.

The Lord Chancellor moved Amendment No. 39:


    Page 17, line 43, at end insert—


("Reversionary interests, valuations and audit
. The duty of care applies to a trustee—
(a) when exercising the power under section 22(1) or (3) of the Trustee Act 1925 to do any of the things referred to there;
(b) when exercising any corresponding power, however conferred.").

The noble and learned Lord said: As with Amendment No. 37, this amendment is also made for the sake of consistency. As I said in speaking to the previous amendment, as the Bill repeals Section 23 of the Trustee Act, with its concept of good faith, this amendment applies the duty of care in an analogous way to Section 22(1) and (3) of the Act, which also gives a power to trustees but, at present, relies on a test of good faith. I beg to move.

On Question, amendment agreed to.

The Lord Chancellor moved Amendment No. 40:


    Page 18, line 2, leave out ("to powers conferred by a trust instrument").

On Question, amendment agreed to.

On Question, Whether Schedule 1, as amended, shall be agreed to?

Lord Goodhart: I should like to make a brief intervention. As the noble and learned Lord the Lord Chancellor will, of course, recall, I was very concerned with one of the provisions of Schedule 1; namely, paragraph 5 which allows the possibility of excluding the duty of care that is proposed in Part I of the Bill. At Second Reading on 14th April the noble and learned Lord gave an undertaking that he would shortly make a formal reference to the commission asking it to carry out an appropriate study with its customary thoroughness. That was, of course, in reference to the question of objection clauses.

I am not making any complaint that no reference has yet been made. I realise that this is not the most urgent and important matter on the Lord Chancellor's desk, but I should be grateful for some indication of what "shortly" means in this case, because I would be somewhat concerned if we were to find this matter dragging on past the Summer Recess.

4.15 p.m.

The Lord Chancellor: I can give the noble Lord, Lord Goodhart, the assurance that he seeks. The last thing I would desire to do is to have this matter drag on. In fact, we thought that the appropriate course—I apologise for not drawing this to the attention of the noble Lord—was to await the outcome of the Lords status of the Bill before inviting noble Lords, including the noble Lord, Lord Goodhart, to whom I specifically address these undertakings, to express their views on

7 Jun 2000 : Column CWH14

the precise form of the references to be made. We will take their views fully into account in making the references.

The Law Commission also is aware informally of what is intended, and is awaiting formal references. My ambition is to achieve this comfortably before the Summer Recess.

Schedule 1, as amended, agreed to.

Schedule 2 [Minor and consequential amendments]:

The Lord Chancellor moved Amendment No. 41:


    Page 19, line 3, at end insert—


("The Duchy of Cornwall Management Act 1893 (c. 20)
. The 1893 Act is hereby repealed.").

The noble and learned Lord said: With your Lordships' leave, I shall speak also to Amendments Nos. 42, 46 and 49.

I begin with an apology. I am very aware that on Second Reading I undertook to give seven days' notice of government amendments. That, of course, was in the spirit in which we have conducted this Bill, and in fact the bulk of those before your Lordships this afternoon were tabled on 24th May. However, these four amendments appear starred on the Marshalled List and were tabled only on Monday last, so I am formally in breach of the undertaking and I trust your Lordships will forgive me.

These amendments insert back into Schedules 2 and 4 the four items which were removed from the Law Commission draft of the Bill when it was printed and introduced into the House at First Reading. The reason was that it had not been possible at the time to obtain both the consents required from Her Majesty and from the Prince of Wales in their rights of their Duchies of Lancaster and Cornwall respectively. These consents are now to hand and these amendments, therefore, replace the removed items. I beg to move.

On Question, amendment agreed to.


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