My Lords, I shall speak also to Amendments 48 and 49, which are in the same group. I wish to address the issues of consumers and contractors or providers with specific reference to the area I know best, which is property services. I am a provider of such services; I am a small business. Not only do I provide services myself but I also provide a certain amount of service in trying to sort out the wreckage of consumers’ arrangements with others, because I deal with a certain amount of dispute-related cases.
I know what it is like to be misled as a consumer. I also know what it is like to be taken advantage of as a provider. I had that very much in mind, echoing the point that the noble Baroness, Lady Hayter, made a short while ago about professional standards. I am old-fashioned. I was brought up to understand that the hallmark of a professional meant that one put the interests of one’s client before one’s own interest. That did not necessarily equate with putting what the client thought their interests were before all else; that is, of course, a different metric. Consumers come in all shapes and sizes, as I know from a long time in the property business. They can be old and cunning, or young, wealthy and spoiled, or just greedy and opportunistic, as well as entirely honourable and decent. Over 90% of consumers are wholly honest in their approach—as are, I am certain, over 90% of service providers. In my view, there is more honest misunderstanding than deliberate malpractice, but I acknowledge that there are some that are consistent cheats—even some very large suppliers. I am not going to name any that I have come across.
We need not to lose sight of the objective of facilitating honest trade and reducing bureaucracy, but we need to be careful about assuming a level of competence among consumers that is often lacking in practice. The principle of protecting the weaker party by legal means does not equate with protecting the consumer at all costs, regardless of circumstances. Some consumers are not only clueless but unaware of their own ignorance in insisting that certain things be done in certain ways—or, to put it more crudely, insisting on a particular price above all costs. Ultimately, it is not for Parliament to protect people, whether consumers or providers, from their own incompetence or stupidity. I will get on to that when I get to the detail of my amendments, with a suggestion as to how it might be addressed.
We must not give rights without insisting on parallel duties, because we all have duties as providers and as consumers. One of the most frequently forgotten about is disclosing material facts relating to the transaction that is in contemplation. The Minister referred to the painter of the bathroom. I would like to refer to the failure of the consumer to maintain a functioning extractor fan. I frequently have to visit modern buildings with high levels of insulation due to problems with condensation, which is mostly to do with the lifestyle of the occupant as opposed to the inherent nature of the building. I say that with some knowledge of members of my own family failing to understand that principle. The Minister will then understand where I am coming from. There are some quite serious issues here that have real-world effects: mouldy clothes, bad living conditions or whatever it may be.
My amendments came to me originally from the Construction Industry Council. I have a professional involvement with that body but I am not a member of it. I want to address the issues in Amendments 47 and 48 because the principle behind them is that not all consumers act fairly towards traders. Some consumers are not rational and can be vindictive. They can believe that they must be right beyond peradventure, regardless of the facts of the case. The council pointed out the case of Walter Lilly & Co Ltd v Mackay from 2012, which was heard in the Technology and Construction Court.
There is a language issue, which the Minister touched on earlier, as I understood her, that consumers may well not understand the jargon or technicality of what is being said by a supplier or some specialist. We all have jargon but one thing that is often misunderstood is the effect of health and safety in carrying out contracts of works. It can escalate costs because of the need, for instance, for scaffolding to replace a gutter or something of that sort. Consumers do not necessarily understand that, so when there is a provision for plant and machinery at cost, they do not necessarily twig that some significant items may be involved.
It seems from the terms of the Bill that the consumer appears to be able to rely on his own fairly subjective memory of what was said, regardless of whether it is near or far from the truth. I worry about that. When one thinks of the studies on the accuracy of witness recall of the facts in the wider judicial system, one can see that there is a real problem. That is not limited to consumers; it may be an affliction of the small business as provider of the service. The CIC pointed out to me that the remedies introduced in the Housing Grants, Construction and Regeneration Act—rights to receive payment and bring disputes to adjudication—are not available to traders if dealing with a residential occupier. Maybe we ought to look at that.
I would hate these things to end up in the courts because I am a believer that there is only one profession that gets rich by that process and that it leads to a lasting impoverishment of others. Most particularly at risk is the hapless consumer himself. He sees no other way and is encouraged or goaded to go to court. It would be my objective to keep people out of the courts if at all possible.
The logical consequence of not having the words that I suggested incorporated into the Bill will be reams and reams of terms and conditions of engagement which, in all probability, whether they are written in large or small print, nobody will read. We will be back where we were before without an adequate remedy other than pursuing these things very expensively. That is why I wish, by Amendments 47 and 48, to insert the test of “reasonably”. The courts have some experience of unpicking the term “reasonable”. I am against their having to determine such matters at all because very often it is not cost-effective to deal with them in that way.
Amendment 49 is slightly different. The Bill refers to the representations, if I can loosely term them as such, made at the same time. A contractor goes along to pitch for a job with a consumer. He makes various representations, or is deemed to do so, but it may in a
sense be a discussion around the issue, trying to refine what the consumer wants and what services will be provided. The contractor goes away and sets it down in writing. It would appear that subsequently setting something down in writing that is different from what was said on site at the first meeting would not exonerate the contractor from having to abide by what he had first said. So I am afraid that we get back to the unedifying spectacle of, “He said this”, “No he didn’t”, which a court is unable to unpick in practice.
The CIC’s briefing note to me referred to an example in which a builder or engineer recommends a particular type of foundation based on the information that he had at the time. It is then found, when they get on site, that some different situation applies; perhaps the ground conditions are not as the initial geotechnical investigation identified. After all, we are in many cases talking about a process, not a bolt of lightning that hits in a moment of time and fixes everything. This is an ongoing transactional process, particularly in the building world. The CIC—and I agree with it—feels that it would be unreasonable for a customer to be able to hold a contractor to the original statement if the contractor set out to clarify that within a short period thereafter. That is why I seek to insert the words,
“or as soon as possible thereafter”.
That is the logic behind it.
I said that I would touch on where I might depart from the CIC’s script, perhaps as a sort of final postscript. The noble Baroness, Lady Hayter, may also see some merit in this. Ultimately, I have suggested a sticking plaster here, but what is really required is a reliable, timely, locally based, informed, mandatory, affordable and authoritative adjudication system of some sort. If you have that in place, you remove most of the chancers from the equation and get back to some form of even-handed thing that does not grow over months and years like little Johnny’s porridge in the mouth, resulting in a complete system failure, whereby access to some sort of resolution is denied for so long that, even if you did get something in your favour, it would be functionally worthless.
We have a model—and I claim some credit for having brought such a thing in—although it would not be perfectly applied pari passu to this particular instance. In 1996, your Lordships passed the Party Wall etc. Act and I had the privilege of taking it through all its stages in this House. In passing, I pay tribute to Sir Sydney Chapman, who took it through all its stages in the other place. He has just died, and I express my appreciation in his memory, and to his family, for the work that was done. I believe that that model could be made better use of so that there was no risk of huge fees being run up, and that sort of thing. We need to get away from having to deal with these things through the courts. If we are not going to have an ombudsman, there needs to be something else in place to deal with it—and there are ways of dealing with it.
Having explained at length, first, where I am coming from, secondly, the meaning of the specifics of the amendments and, thirdly, a suggestion of how things might be dealt with in future, I beg to move.
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