Company Law Reform Bill [HL]

My Lords, I have many amendments in this group which I tabled again because we were advised by those affected by the provisions that the Government’s original drafting would not achieve the result that people wanted, which they thought had been agreed—proportionate liability agreements. I am very pleased that the Government have tabled their amendments in this group. As I understand it, there is now substantial agreement across the piece that the clauses that we shall have after the amendments are passed satisfactorily achieve limitation of liability provisions. On behalf of all those who have been involved in discussions with the Government, I place on record their thanks for the positive and constructive way in which the Government have dealt with the issue. It marks a real move forward. I am also grateful for what the noble and learned Lord said about taking power to deal with issues that may arise from the competitive impact if fixed-sum capping ever produced a competitive disadvantage to certain types of firm. I am sure that that is the right way forward. I do not need to speak to the majority of my amendments in this group, but I shall speak to Amendment No. 391A, which amends government Amendment No. 391. It is a probing amendment. Amendment No. 391 responds to concern about when fairness and reasonableness of the agreement is to be determined. The government amendment states that,"““no account is to be taken of . . . matters arising after the loss or damage . . . has been incurred””." The issue is what that actually means. Loss or damage is normally suffered rather than incurred but, if we leave that on one side, we are unclear whether that is intended to mean the point at which the course of action arises—hence, when the damage first occurs—or the last date at which damage occurs. Damage flowing from the course of action will often take place over a long period. Indeed, it may be continuing at the time that the court considers the issue. I ask the Minister to set out clearly what the Government intend to be the effect of Amendment No. 391. If they agree that there is undesirable ambiguity in their amendment, I invite them either to agree to Amendment No. 391A—which, I accept, is unlikely—or to table something else at Third Reading.