Mr Don Foster (Bath, Liberal Democrat)

I beg to move amendment No. 26, in page 2, line 25, at end insert—

`(5A) The seller does not become responsible under subsection (5) by marketing the property to an individual who is known to him or by virtue of any informal conversation with any individual.'.

I ran to ensure that I was here on time this morning but, in view of the time wasting, perhaps I did not need to bother.

You were privileged, Mr. Gale, to hear the use of argument A in the first sitting. Unfortunately, Mr. Stevenson, who was in the Chair for our second sitting, had not been acquainted with it, so we had to explain its ramifications to him. To avoid any difficulty for you, I should explain that during your absence, the hon. Member for Eastbourne (Mr. Waterson) introduced a new character into our proceedings: the owner of 74 Acacia avenue.

Mr Nigel Waterson (Eastbourne, Conservative)

As this shadowy character is obviously going to become a close friend of and regular attender of the Committee, should we give him a name? Mandelson perhaps?

Mr Don Foster (Bath, Liberal Democrat)

I have not yet been notified of the chap's name. I know that he is a regular recipient of ``Focus'' newsletters but rarely receives copies of the ``In Touch'' newsletter, which was a point raised during our second sitting.

The important point is that the occupier of 74 Acacia avenue, Mr. Mandelson or whoever, is a regular habitue of his local public house.

Mr David Curry (Skipton & Ripon, Conservative)

That is tautologous. Such a person can be a regular or an habitue but he cannot be a regular habitue.

Mr Don Foster (Bath, Liberal Democrat)

I apologise to you, Mr. Gale, to the right hon. Gentleman and to the entire Committee for wasting time with tautological phrases. I will try to do better.

The chap goes to the pub regularly. On Second Reading, the hon. Member for Eastbourne and others asked what would happen if, during conversations in the pub, the chap announced that he planned to sell his house—74 Acacia avenue. I had hoped that you would select amendment No. 17, Mr. Gale, which states:

after `action', insert `excluding casual conversations in premises licensed for entertainment or for the sale of intoxicating liquors'.

However, you selected amendment No. 26, which would insert

`The seller does not become responsible under subsection (5) by marketing the property to an individual who is known to him or by virtue of any informal conversation with any individual.'.

That stands whether that conversation takes place in a pub or elsewhere.

Our concern is that there remains a lack of clarity as to when it can be deemed that the sale process has begun. Once it is deemed that the sale has begun, clause 3(2) states:

The responsible person shall have in his possession, at all times during that period, a seller's pack for the property which complies with the requirements of any regulations under section 7.

That means that if the occupier of 74 Acacia avenue indicates in a casual pub conversation with somebody who is not a friend or relative or is little known to him that he intends to sell his property, he is not only covered by the Act but, more importantly, must have a copy of the seller's pack in his possession. If the conversation involved more than one person, presumably the occupier would have to have more than one copy on his person. As he is such a gregarious character, and might speak to many people in the pub, he would have to possess numerous copies.

This is a probing amendment that seeks clarification from the Minister on the point at which clause 2, and the rest of part I, will come into effect. As it stands, the wording is seriously ambiguous, which will affect its interpretation. Failure to comply with the Act will lead to criminal prosecution, so it is a very serious matter and we need to be clear about precisely when the sale is deemed to have started.

Although the Minister may not be prepared to accept amendment No. 26—I suspect that he would have preferred amendment No. 17 with its direct reference to the pub—I hope that he is willing to provide much greater clarity on the issue.

Mr Roger Gale (North Thanet, Conservative)

Before we continue, I appreciate that we have to brighten our dull lives, and that a certain amount of levity in the Committee is therefore in order—but only a certain amount. Some jokes wear thin, and the gentlemen of the press have been known to make hay at the expense of the dignity of the House. Although 74 Acacia avenue and argument A are acceptable shorthand, we should draw the line there.

Mr Nigel Waterson (Eastbourne, Conservative)

Right. Mr. Gale, I promise that the word ``Mandelson'' will not pass my lips again during the sitting. However, it is helpful to be able to refer to an address, and your ruling allows that.

The hon. Member for Bath (Mr. Foster) obviously has a sentimental attachment to amendment No. 17 and bitterly resents that it was not selected, but, effectively, we debated it when the Committee discussed amendment No. 26.

The Committee supports the thrust of the hon. Member for Bath's argument, but the Minister shot his fox, or at least wounded it—if that is not too topical an analogy—when he said on Tuesday that he would introduce regulations to deal with sales to friends and close family members; I was desperately trying to find that part in Hansard.

The Committee will recall our long and learned debate about what constitutes a family or a trust and so on. However, with specific reference to friends, does the Minister think that such points will be swept up in the regulations?

The hon. Member for Bath raised an important question: would the proposed regulations set the machinery of justice moving if the seller were to have an informal chat with someone in a pub or elsewhere? Will the Minister make clear whether the legislation would apply to someone selling in such circumstances?

On Tuesday, the Minister used the word ``friend'', and I wait agog to discover how the departmental draftsmen will define the term. Their definition might not encompass mere acquaintances or drinking buddies, but the legislation should not apply to such informal relationships. It is bad enough that the panoply of the criminal justice system is to be wheeled out to deal with ordinary people engaged in free contractual relations in the buying and selling of property, but to apply it to people making such transactions freely and informally is anathema. Will the Minister assure me that the term ``put on the market'' will not catch friends of the seller or people introduced to the seller through friends? Will that be made clear in the legislation?

As the Committee stage progresses, I fear that the Bill will shrink while the mass of regulations grows. Given what the Minister has said, it seems unlikely that the Committee will have an opportunity to consider even some draft regulations.

I support the thrust of the argument of the hon. Member for Bath, and look forward to hearing the Minister's response.

Mr Geoffrey Clifton-Brown (Cotswold, Conservative)

I seek your guidance, Mr. Gale. I want to make a narrow but important point about clause 2 that is tangential to the amendment. Are you minded to have a clause 2 stand part debate, or should I make my point now?

Mr Roger Gale (North Thanet, Conservative)

Curiously enough, the Clerk and I have been discussing that. The hon. Gentleman knows that I am relaxed about such matters. The issues that would be raised in a clause stand part debate can be covered during the main debate on the amendments or there can be a separated debate the end. If it would help the Committee, the hon. Gentleman can raise his point now, on the understanding that it is likely that I would therefore be minded not to have a clause stand part debate at the end. The decision is for him and his colleagues.

Mr Geoffrey Clifton-Brown (Cotswold, Conservative)

There is a weakness in clause 2(3). It refers to

A person acting as estate agent.

The Committee knows that sometimes, more than one estate agent is appointed to sell a property, and I can envisage many situations where there might be a muddle about which agent is responsible for ensuring that there is a seller's pack. That aspect of the clause needs to be tightened up

In our previous sitting, the Minister mentioned introductory agents. An agent might know that someone is about to put a property on the market, and might introduce a purchaser to that seller, even though another agent has been instructed. In such circumstances, who is responsible for ensuring the production of the seller's pack—the introductory agent or the agent already instructed? The Minister should clarify those two important points.

Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

I heartily second your point, Mr. Gale, about 74 Acacia avenue testing our good humour. Had you been present at our previous sitting, you would have heard a lot of nonsense about a lady in red sequins and even some references to the gestapo. I do not intend to pursue those this morning. I hope to satisfy the concerns of hon. Members who have spoken today.

The Bill places the obligation to produce a seller's pack only on those marketing a property

to the public or to a section of the public.

I shall explain the reasoning behind that. Ideally, we would like anyone who is selling a house to have prepared a seller's pack before seeking to interest potential buyers, but we also have to consider practicality and enforceability.

Most people make a deliberate decision to market their property, and then approach an estate agent, who mails out particulars, or advertises in the local press or the shop window. A private seller might advertise in the local paper, through a ``for sale'' notice in the front window, or on the internet. In each case, there is clear evidence of marketing, and a seller's pack should have been prepared beforehand.

There are, however, cases in which a person might let family or acquaintances know that they are interested in selling their home. It would be difficult to enforce the production of a seller's pack in such cases because there would be no tangible evidence of marketing. The person may simply have been signalling an intention to market through an agent later.

We have carefully considered whether exempting such cases significantly undermines our policy, and have concluded that it does not. Such cases will constitute a small minority. In nearly all of them, the buyer will be known to the seller, so there will be a much lower chance of concealing material information that causes delays. We anticipate that it will become normal practice for buyers to ask to see a seller's pack, so should a buyer express an interest, the first action would usually be for the seller to commission the necessary work.

Clause 2(5) provides that the seller becomes responsible for marketing the property—and therefore subject to the seller's pack obligations set out in clause 3—when he either puts the property on the market or makes public the fact that it is. Clause 1(4) provides that a property is put on the market at the point at which the fact that it is, or may become, available for sale, is first made public. Clause 1(6) provides that a fact is made public when it is advertised, or otherwise communicated, to

the public or to a section of the public.

That rehearses our discussion on clause 1.

The expression ``public or a section of the public'' has been used before in legislation where some flexibility is desirable, for example in the Race Relations Act 1976. The expression is not defined in the Bill—and the same is true of other legislation—precisely to maintain flexibility. The use of the expression signals an aim to cover some people and not others. Were that not so, communication to any person would constitute marketing.

With regard to case law in other contexts, we consider that ``the public'' relates to the public at large, and that ``section of the public'' would not include family members, individuals, or small groups of people, especially if they were known to the seller. Therefore, the Bill's drafting does not affect marketing to individuals and goes further than the proposed amendment.

In the final analysis, it will be for the courts to determine, on the evidence of the case and the purpose of part I, whether marketing had extended to the public or a section of the public.

Mr Don Foster (Bath, Liberal Democrat)

Will the hon. Gentleman give way?

Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

I will in a moment.

We are confident that the actions mentioned in amendment No. 26 do not amount to putting the property on the market as defined in clause 1(4) and do not therefore trigger the seller's pack obligations set out in clause 3.

Amendment No. 17 refers to conversations that might take place in a pub. My hon. Friend the Minister dealt with that when we debated clause 1 on Tuesday. He said that a conversation between individuals known to each other would not constitute marketing. However, as he put it, if someone stands on a bar stool in the pub and announces to all and sundry that his home is for sale, those obligations might well be triggered. That is the crucial distinction.

The hon. Member for Cotswold (Mr. Clifton-Brown) asked about the situation where more than one estate agent or person acts as an agent. All agents marketing the property would have to have a pack. I hope that I have dealt with the points that were raised.

Mr Don Foster (Bath, Liberal Democrat)

The Minister is being helpful, not least by putting his remarks clearly on the record. If he looks through the record, he will see that he has referred to relationships where the parties are known to each other, acquaintances and casual acquaintances. Will he state clearly whether a casual conversation with a person not previously known to the potential seller is covered by those remarks?

Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

Yes, provided that it is an individual and not a group of people.

The hon. Member for Eastbourne asked whether we would introduce regulations to define friend or family member. No, we will not. Clause 1(6) defines that the property is marketed when it is:

communicated ... to the public or to a section of the public.

We believe that that is adequate for the purpose.

I believe that I have addressed the points made by the hon. Members for Bath and for Eastbourne. The situation is clear enough and was covered the other day when we debated clause 1. Therefore, I ask the hon. Member for Bath to withdraw the amendment.

Mr Don Foster (Bath, Liberal Democrat)

I repeat my thanks to the Minister for his helpful comments. Our deliberations during the Committee's second sitting were predominantly about whether a seller's pack would be required during the sale itself, in a sale between the seller and an acquaintance or a friend. As we understand it, an individual not previously known to the seller would not be excluded, and in those circumstances a seller's pack would be required. I hope that it is clear that there is a difference between the two points.

If I wished to pursue the point further, I would raise the case of serial meetings with individuals and whether they are included in the prohibition in relation to groups of people. However, I suspect that that will become clear later.

In light of the Minister's helpful comments, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr Roger Gale (North Thanet, Conservative)

Unless any hon. Member has a burning issue that arises from clause 2, I am minded to—

Mr Geoffrey Clifton-Brown (Cotswold, Conservative)

I am sorry to be a nuisance, but I do not believe that the Minister adequately answered my point. People often decide to put a property on the market and instruct an estate agent who then begins the marketing process. Another agent sees that marketing, says, ``Ah yes, I have a client who is looking for precisely that type of property'', and introduces his client to the other estate agent or the vendor. Surely the agent who has made the introduction but who has had nothing to do with marketing the property is not required to have a seller's pack available, as well as the original agent who received the instruction.

Mr Roger Gale (North Thanet, Conservative)

The hon. Gentleman has been in the House for long enough to know that if he wants to make an additional point, he should rise before the amendment is withdrawn. I am prepared to allow the debate to continue on this occasion, because I may be partly responsible for the confusion. However, the Committee is now out of order, so I will move that clause 2 stand part and take the hon. Gentleman's comments as part of the debate.

Question proposed, That the clause stand part of the Bill.

Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

If there is more than one agent, whatever the relationship between those agents, each will have to have a seller's pack.

I should like to answer a question put to me by the hon. Member for Bath, which I did not address in my earlier remarks. He asked whether the seller had to have more than one copy of the seller's pack if he marketed it to more than one person. No, the seller needs to have only one copy in his possession, so there is a bonus for the hon. Gentleman.

Mr Don Foster (Bath, Liberal Democrat)

It always helps to put these things on the record. I understand the need for the seller to have one pack on his person. However, what will happen if he has met one individual and given him the pack? Will he be obliged to have another pack available for anyone else he might talk to?

Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

If the seller is marketing it to someone else, in due course he will have to provide another copy. However, he only needs to have one with him when talking to an individual, not a big pile. He can show it to the prospective purchaser, take it back, make a copy, or do what he likes. If he is marketing the property within the terms of clause 1(6), he must show a seller's pack to everyone to whom he is marketing. If he is marketing the property to several people, each of them will need to see one.

Mr Don Foster (Bath, Liberal Democrat)

My point may seem trivial, but clause 3(2) states:

The responsible person shall have in his possession, at all times during that period, a seller's pack for the property.

I put it to the Minister that, having just handed over a seller's pack, the person whom he has described will no longer have on his person a copy of the seller's pack. I suspect that the answer lies in the definition of ``have in his possession''. Perhaps when we reach clause 3, the Minister may think it appropriate to raise these points.

Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

The seller has 14 days to provide any copy. I suspect that he could use a photocopier should the need arise.

Question put and agreed to.

Clause 2 ordered to stand part of the Bill.