The Bill Dissected By Our Legal Adviser
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Dangers for Operators
A Generally Well-drafted Bill Contains Difficulties for Purchasers of Transport Units, Ambiguity Concerning "Additional Vehicles" and a Harsh Penalty for Inaccuracy in Statements Supporting Licence Applications
ON the whole, the Transport Bill appears a fairly compact and well-drafted measure—entirely apart from the rights or wrongs of it—consisting of 33 clauses and three schedules, of which not all, by any means, relate to road transport. It does, however, contain certain ambiguities and dangers for operators, which I shall point out.
A notable feature of the Bill, from a legal point of view, is that little remains to be done to make it work, other than the creation of the Road Haulage Disposal Board. It thus transgresses the general trend of modern statutes, which are often mere " enabling " Acts, or general frameworks giving the Minister concerned wide powers to make such regulations as he may think fit to clothe the skeleton and make it a living proposition. This, at least, has mercifully been avoided, save in one instance. Nothing is more slipshod, or so open to abuse, as the enabling Act.
Certain things are due to take effect when the Bill becomes law, and others only after " the appointed day," which the Minister will name by means of Order in Council. He may, in fact, name different appointed days for different purposes in the Bill.
Clause 1 lays down "the duty" of the British Transport Commission to dispose of the Commission's existing road haulage undertaking as quickly as reasonably practicable. The words used in reference to the undertaking are "all the property," which would seem to make it-clear that not only vehicles are to be disposed of, but everything else, including works, offices and stock, although the " undertaking " itself has already been held to include these.
No More Acquisitions Clause 1 (3) refers to Sections 39 to 51, 54, 55 and 60 (2) of the Transport Act, 1947, which were the sections in that Act dealing with the acquisition of undertakings by the Commission... It provides that such power to acquire .shall cease, and any notice of acquisition already given shall be void, except that any act of acquisition actually completed by transfer before this Bill becomes law (i.e., when the Royal Assent is received) shall stand. It will stand, of course, purely as a matter of administrative tidiness, only to be disposed of under the other provisions of the Bill. This is to prevent a sort of "betwixt and between" situation.
The whole of Clause 2 is devoted to the creation by the Minister of the Disposal Board and various necessary administrative details are set out. The only point of legal interest is, perhaps, that raised-by 2 (13): "subject to the preceding provisions of this section, the Board may regulate their own procedure."
The relationship 'between the Board and the Commission is not set out until Clause 3 (6), which makes it clear that for the purposes of sale of "transport units it is the Board which is to have the whip hand. The Commission must consult the Board and "act on lines settled from time to time with the approval of the Board." Furthermore, the last word as regards the acceptance of any offer lies with the Board, but where on any matter conflict arises between the Commission and the Board, either may refer the dispute to the Minister for his "direction."
Clause 3 is concerned with the sale of what are to be known as "transport units." By paragraph 1—a most important provision—it may be a condition of any such sale that "the purchaser takes over such rights and obligations of the Commission, whether under contract or otherwise, as may be specified, being rights and obligations connected with the subject matter of the purchase." Clearly, purchasers will be anxious to know -what rights they are taking over, but it may well be that their "obligations " are even more important to them, and the words italicized show just how wide these may be.
Heir to Litigation
As this paragraph is framed, a purchaser might find himself the heir to expensive litigation. By section 45 of the Transport Act, 1947, it was likewise provided— although in somewhat different form—that existing contracts at the date Of a notice of acquisition would have effect as from the date of transfer, as if the Commission had been a party to the contract. The whole business of assignment of rights and obligations when one body takes over or merges with another is fraught with difficulties, and the only general and sound advice that can be given to any prospective buyer, if such conditions are incorporated in the contract of sale, is to take legal advice.
The 1947 Act also contained a provision in Section 45 (4) that where legal proceedings were actually pending at the date of transfer, the Commission might be added as a party to the proceedings or substituted as a party, but in the next sub-section (5) it was provided . that nothing was to affect any right to, or liability to pay any de.bt already due or damages already accrued at the date of transfer. No such saving clause appears to be contemplated here and the Bill is far too vague on this point.
Seeking an Indemnity It appears to leave open to negotiation with buyers precisely what rights and obligations, "whether under contract or otherwise," are transferable and if there is this elbow-room for negotiation, the safest course is to seek an indemnity in respect of undisclosed obligations and liabilities.
It appears to be clear from Clause 3 (2) and (3) that the main consideration in splitting up the Commission's property into transport units " is to be the convenience of purchasers in being able to engage "without delay in the carriage of goods," and the desirability of not neglecting the "little man." Securing a good purchase price is expressed to be of importance only subject to these prior considerations.
Although a unit of 50 vehicles of 200 tonsis to be the largest, provision is made for approval by the Minister of a larger number, but there is no indication on what grounds or evidence he will exercise this discretionary power.
In Clause 3 (5) there is a reference to what are called "additional vehicles," the numbers of which are not to count against the limit of 50, or towards the vehicles referred to in the First Schedule. (Which details the rights of obtaining special A licences for five years free of charge.) There is, however, no indication whatever as to what these vehicles may consist of or how they become specified as "additional" In the First Schedule one . is merely referred back to Clause 3 (5). Presumably the additional vehicles are specified by the Commission when tenders are invited for the purchase of complete transport units.
The second part of Clause 3 (5) (a) envisages the legitimate substitution, if desired by a purchaser, of such a vehicle for some other vehicle in the unit which, for instance, may be destroyed or unsuitable, for the purpose of obtaining a five-year free licence.
Changes in 1933 Act
Clause 8 is of great importance and requires detailed examination, because it makes great changes in Sections 6, 11 and 13 of the Road and Rail Traffic Act, 1933. Those sections deal with the granting, refusing, suspension or revocation of licences. The most significant change is the direct recognition that Licensing Authorities must realize that the needs of the public come first.
This is done by substituting for the words in the 1933 Act, "shall have regard primarily to the interests of the public generally, including those of persons requiring, as well as of those of persons providing, facilities for transport," the words, shall have regard to the interests of the_ public generally, including primarily those of persons requiring facilities for transport and secondarily those of persons providing facilities for transport." No apology is needed for reprinting these words—the spirit which they seek to animate should at all times be the only true criterion.
Secondly, where any objection is taken before a Licensing Authority to an application for a new or varied licence, there is a complete reversal of what has previously been the practice. Hitherto it has always been necessary for an applicant to show that existing facilities were inadequate if the contrary were alleged by his opponents. Now he has, indeed, to prove—as before— a public need for the service he proposes to provide, but objectors must prove their grounds of objection affirmatively, and. not by saying, I object on suchand-such a ground," throwing the onus of disproving it on the unfortunate applicant. This is the proposal contained in Clause 8 (3), and it is much more in conformity with legal and moral commonsense.
A Harsh Measure But in Clause 8 (4) is a rather sobering antidote to the pleasure evoked by this proposal. An additional ground of suspension or revocation of a licence under Section 13 of the 1933 Act is the making, for the purpose of the application, of any statement of fact which was false or any statement of intention or expectation which has not been fulfilled. In relation to the false statement, it is sufficient if it is false, whether the applicant knew it or not.
Obviously, persons giving evidence in support of their own or other people's applications are morally and legally bound to exercise great care in stating facts or expressing intentions or future estimates. Estimates, it is recognized, cannot be " false " in the same sense as a present statement of fact, but if incorrect, they provide equal ground for the revocation or suspension of a licence.
The test of falsity is an alarming one; it is objective B13 and not subjective, so that if a present fact is wrongly stated it is ipso facto false, and the state of mind of the speaker is immaterial. ' Moreover, it may be sufficient to upset things if made by any witness called in support of the application. The obvious moral—apart from picking one's supporting witnesses with the greatest care—is to disown and deny immediately any incorrect statement of fact made on one's behalf for the purposes of an application. The only sop offered with this harsh measure is the power of the holder of a licence threatened with such suspension or revocation to demand first a public inquiry.
The Levy and Public Roads"
Clauses 10 to 14 relate to the raising of the transport levy and the creation of the Transport Fund, and nothing here would seem to call for much legal comment, although no doubt they have already called forth much comment from almost every other aspect. One point to be noticed, perhaps, is that the levy will be made only on vehicles used on or after the appointed day on "public roads," For a definition of " public roads" we are referred by Clause 10 (7) to the Vehicles (Excise) Act, 1949, which makes the test of whether a road is "public," whether it is repaired and maintained at the public expense. The test of what is payable in respect of a superimposed (articulated) vehicle or a trailer and the test of unladen weight are also expressed to be the same as applied by Sections 5 (4) and 5 (5) and 26 of the Vehicles (Excise) Act, 1949.
One of the most important parts of Clause 17 is the provision that passenger road services provided by the Commission will have to be licensed in the same way as those run by any private operator. This condition will not, however, apply to the London Transport Executive. I will deal in detail with Section 17 in a later article.
The clauses (19 to 22) dealing with the whole question
of charges which introduce various amendments to the present charges schemes, seem to me to be reasonably clear and to require no comment. Neither do those consequential amending clauses, or those which provide for compensation and pension schemes for employees of the Commission who lose their jobs as a result of the Bill, call for interpretatior
• Power of the Minister It is here, however, in Clauses 25 and 26, that occurs the only instance of the delegation of law-making to the Minister. No one would quarrel in such an instance with the decision that such matters are better worked out in detail and incorporated in regulations rather than in the body of an Act of Parliament. That is not to say that the Minister is likely to play a small part in the working out of the whole project embodied in the Bill, for there are many instances where his power and influence are likely to be felt.
He may direct to a large extent (Clause 5) what property is to be or is not to be treated as being part of the existing undertaking. He it is who appoints the members of the Disposal Board. It is his approval for a larger unit than 50 vehicles which must be sought. It is to him and his " direction " that the Commission and the Board are to refer any dispute between them. These are but a few instances.
Where such a preponderance of decisions is with a member of the executive rather than with the courts of the country—although this is fully in accordance with the trend of modern legislation—a lawyer may rightly feel that many questions of construction and interpretation are matters of guesswork rather than the application of legal principles.