Part of Orders of the Day — Supply – in the House of Commons at 12:00 am on 21st June 1978.

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Photo of Mr John Lee Mr John Lee , Birmingham Handsworth 12:00 am, 21st June 1978

The hon. Member for Melton (Mr. Latham) has given us a dissertation on the Community Land Act. My view is that the more I see Labour local authorities slapping compulsory purchase orders on properties the happier I shall be. We might be able to avoid some of the ramifications and difficulties that are inherent in that admirable Act if there is an absolute plethora of compulsory purchase orders.

My hon. Friend the Member for Thurrock (Dr. McDonald) raised the question of gazumping. That same subject featured in a debate on the Estate Agents Bill, which is being reluctantly processed through the House at the moment. The hon. Member for Wirral (Mr. Hunt) raised the matter on that occasion. Both he and my hon. Friend in different ways have drawn attention to a problem that has exercised many of us for a long time.

It is a curious historic survival of an Act that was passed in the seventeenth century—the Statute of Frauds—whereby, at total variance with the position in contract law as a whole, the consideration of the stakeholder, being such as it is, does not represent a binding contract in the sale of a house.

This matter has been the source of no end of heartache, of disappointment and of considerable loss for many people. I have been the victim of gazumping in the past. We all know of people who have suffered in this way. It is the more extraordinary because it is clearly something that could be easily rectified by a simple Act.

It is worth remembering that as a general principle of contract law, if there is consideration for a promise, and the consideration moves against the promise, there is a binding and therefore actionable contract in the event of breach.