Schedule 1 - Fixed penalties and enforcement
Homes Bill
6:30 pm

Mr Tim Loughton (East Worthing and Shoreham, Conservative)

We have already discussed part of the schedule, which concerns fixed penalties and enforcements. I do not intend to rake over previously covered ground, but I have about half a dozen points that I would like the Minister to clarify. Paragraph 4(1) states that there is a facility for withdrawal of a fixed penalty notice. In what circumstances does he envisage that withdrawal notices will be used? Under paragraph 6(4), a weights and measures officer who has reason to believe that documents might be required is empowered to

seize and detain them and . . ., if he does so, inform the person from whom they are seized.

If the fault is deemed to lie with the estate agent who has the documents necessary for a seller's pack, and if that agent has jumped the gun and commenced marketing without first assembling the component parts of the seller's pack that the Secretary of State has deemed appropriate, it is the vendor of the house who could be most inconvenienced. If weights and measures officers were to seize documents from the estate agents Bloggins & Co., would the sale of the house be left in limbo? Given that it might take time to establish what action will be taken, and to pursue what might prove a criminal action, the vendor could be left sitting on a house that he is not allowed to sell. Would the vendor be able, for example, to end his contract with the potentially criminalised estate agent and move the sale—lock, stock and barrel—to another agent? If so, how will the seized documents be resecured, so that they may form part of the alternative agent's seller's pack? We must address that practical problem, so that we can protect the vendor.

The word ``reasonable'' appears several times in paragraphs 6 to 8. Weights and measures officers are empowered to make reasonable inquiries and to secure documents that are reasonably relevant. What safeguards exist to ensure that reasonableness will not be stretched to its limits by a trading standards officer who, for example, has a grudge against a firm of estate agents whom he failed to convict for reasons that we have discussed? How will ``reasonableness'' be defined? I can find no definition of it in this context.

Under section 7—and, indeed, under section 6—weights and measures officers who have seized documents are obliged to

inform the person from whom they are seized.

Again, that person is most likely to be an estate agent, but there seems to be no requirement for the weights and measures officer to inform the vendor of the house. Surely the vendor should have an equal right to know that there is a potential problem with the sale of the house. A particularly unscrupulous estate agent—if such a person exists—could choose not to inform the vendor that he was the subject of an investigation by a weights and measures department, and that the documents that formed part of the seller's pack had been seized. The vendor could be under the impression that the estate agent was marketing the house, and wondering why no callers are viewing it, only to discover that marketing had technically been suspended because an investigation was under way. The Bill should surely require that the vendor be notified of any seizure of documents or action against an estate agent. I am surprised that I can find no reference to such a requirement.

Paragraph 7(4) states:

The powers of an officer under this paragraph may be exercised by him only at a reasonable hour and on production (if required) of his credentials.

Again, there is the question of the definition of reasonableness. Reasonable hours as kept by the Under-Secretary might be rather different from those kept by the estate agent Bloggins & Co. Can the Under-Secretary provide more detail on what constitutes reasonable hours?

This is a long schedule with many technical and, if I may say so, vague references. I have asked a mere soupccon of the many questions that practitioners will ask themselves when faced with this terminology. Given the time and effort that the Under-Secretary has spent on fashioning what he sees as foolproof legislation, I trust that he will be able to answer my questions immediately and off the top of his head, without referring to any notes that might be handed to him.

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

As it happens, I could have guessed most of the answers that I have received, because they largely concern matters of common sense.

One must bear in mind throughout this discussion that the schedule, like the enforcement clause that we have just discussed, is lifted almost entirely from the Property Misdescriptions Act 1991, which was introduced by the previous Government. The same questions might therefore have been asked of that Act, although I doubt whether they were.

The hon. Member for East Worthing and Shoreham asked about the circumstances in which paragraph 4(1), which will enable withdrawal of a fixed penalty notice, will be used. It will be used, for example, if a mistake has been made. Has it occurred to the hon. Gentleman that people sometimes make mistakes? Not everybody corrects their mistakes, of course, but trading standards officers do. He asked whether paragraph 6(4), which enables the seizing of documents, would in such circumstances leave the sale in limbo. In fact, the vendor would not be prejudiced by seizure because copy documents can be made and he could retain his own copy.

The hon. Gentleman asked what safeguards exist in terms of the reasonableness of trading standards officers' behaviour. The short answer to that is the British legal system. He asked who is to notify a person whose documents have been seized. That is the estate agent's job, because he has a contractual relationship with the vendor and is therefore liable. The hon. Gentleman also asked what constitutes a reasonable hour for the exercising of an officer's power. Here he is returning to his ``something of the night'' argument, in which he imagines trading standards officers exercising their powers in a gestapo-like fashion at 4 o'clock in the morning. That might happen in west Sussex, but it certainly does not in Sunderland. His guess as to what constitutes a reasonable hour is as good as mine, but I imagine that the English courts might have something to say if officers started bashing down doors at 4 o'clock in the morning. I rest my case.

Mr Tim Loughton (East Worthing and Shoreham, Conservative)

I am glad that the answers were so simple and such a matter of common sense that the Minister still needed to read the notes that were thrust under his nose. That shows that the answers were not obvious. Indeed, they give rise to further questions.

Of course a sale will not be interrupted, because only copy documents are required—there will not just be one seller's pack. However, the weights and measures officer will, presumably, have taken action either because something in the seller's pack is incorrect, or because something has not been included in it. Could the sale process be restarted for the vendor, seamlessly and straight away? Could it be restarted with the same firm of estate agents, which would then be required simply to insert the missing document or correct the erroneous one? Given the basis of employee or employer responsibility and liability, could the sale continue with the same estate agent even though an employee of that estate agency was the subject of a criminal investigation? There is a potential conflict of interest. If the sale cannot be restarted with the same estate agent, how easily can it be transferred to an alternative firm?

For the Minister yet again to dismiss my question in a complacent manner is most unsatisfactory. He tells us that the estate agent is contractually obliged to communicate to the vendor that a sale has been interrupted or suspended—whatever terminology he chooses to accept. Where in the contract is it clearly stated that the estate agent has a contractual duty to inform the vendor of any seizure of documents, any interruption or potential interruption of the sale through the actions of weights and measures officers? We, as laymen, want the answers, but so do technical experts and practitioners in the field. It is not a matter of common sense. There are many details still to be provided. The Minister—solo—did not know the answers. We should approach the questions with rather more seriousness than he has shown.

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

I dealt with all the points head on. The notes that I was struggling to read were my own. They were to remind me of the clauses to which the hon. Gentleman had drawn my attention. He asked whether the sale could continue. Yes, it could, although it is possible that the vendor might have lost confidence in the estate agent if there had been a raid that resulted in documents being taken away. The cause of the raid might have been a complaint from the vendor, which would make it highly likely that he would want to go elsewhere. That is a matter for the vendor to decide.

The hon. Gentleman asked about the estate agent's duty to inform the vendor in the event that he is investigated. The estate agent has a duty to market the property. He has a duty towards the vendor from the moment an agreement is reached. A contract does not have to written down in black and white, although there will be terms and conditions that are standard to the profession. The estate agent will be expected to perform his duty to the best of his ability. If he keeps quiet about some relevant consideration, such as the fact that he is, in some way, under investigation, he will be in breach of that duty.

Question put and agreed to.

Schedule 1 agreed to.

Clause 10 ordered to stand part of the Bill.