On section 2, there is a provision in the section——
Decimal Currency Bill, 1970: Committee and Final Stages.
Section 1 agreed to.
SECTION 2.
Question proposed: "That section 2 stand part of the Bill."
I am afraid I cannot hear the Deputy.
I am not surprised; there are a number of Fianna Fáil Deputies outside the barrier.
There are a number of other Deputies also.
Subsection (1) provides :
A bill of exchange or promissory note drawn or made on or after decimal day shall be invalid if the sum payable is an amount wholly or partly in shillings or pence.
This is a rather harsh provision in my opinion and some effort should be made to leave the position a little more open; if that is not done more chaos will be caused in an already chaotic situation. Would the Minister consider the matter? If he said that payments would be met at a certain figure up or down, mentioning the equivalent in decimal currency, that would be a far easier way of dealing with it rather than the way suggested in the Bill.
What interpretation is to be given to the word "invalid"?
RD.
Not necessarily.
To take Deputy O'Higgins's point first, I take it to mean that the legal effect would be the same as it is in the case of a cheque which was inadvertently dated 2nd January, 1970, when it should in fact have been dated 2nd January, 1971. Strictly speaking, a cheque operates for only six months after the date, but the practice in cases in which the incorrect date is clearly inadvertent is for the banks to deal with the cheque as if it were correctly dated. The reason for the provision here is because there must be some degree of certainty legally as to where people stand. If the provision were not included there would be an enormous amount of administrative work thrown on the banks. Because of the volume of financial transactions which they handle, it would not be possible for them to work simultaneously in both decimal currency and Lsd during the change-over period. Furthermore, this provision should encourage a quick change-over thereby reducing the changeover period to a minimum. I do not anticipate any hardship being likely because the position will be analogous to the situation that arises every year in the case of inadvertent dating.
The Minister has missed one point. If one puts in the wrong year the option is there for the bank to deal with that in a certain way. When this Bill is passed it will be the law of the land and it will, therefore, be an entirely different matter.
The situation will be identical. If a cheque is incorrectly dated 2nd January, 1970, instead of 2nd January, 1971, as the position stands at the moment, it is invalid and the bank need not honour it but, in practice, it is honoured. I visualise a similar situation operating under this section.
The Minister says a bank does not have to honour a cheque which is incorrectly dated. If the misdating is clearly inadvertent then the cheque is a perfectly valid instrument and is so regarded but, if you legislate and say it is invalid, has anyone then the authority to deal with it as if it were a valid transaction?
I do not know the precise wording where cheques are concerned, but I feel certain the word "invalid" or some similar word is used.
Would the Minister have a look at it to see if it might be preferable to the wording in this provision and then introduce it by way of amendment in the Seanad.
I will have a look at it, but I am quite certain the effect is the same.
I wish I could be as certain.
What do the words "if it bears a certificate in writing by a banker that it was so drawn or made" mean? How will it be certified? Will it be the same as it is for a cheque?
I am not quite sure what precise mechanism will be used, but if a person is holding a post-dated cheque to operate after Decimal Day——
It relates only to post-dated cheques?
Yes.
Then it is a small matter. The wording would give one the impression that it related to all cheques.
Only to post-dated cheques.
There would be a certificate, I take it, in a formal kind of way.
The idea is that the holder of the post-dated cheque would produce the cheque to a banker and the banker would certify that it had been produced to him and this would make it valid after Decimal Day even though it is in £sd.
Why can the Minister not give authority to the banks to convert the whole thing on the basis of the table in the Schedule?
The banks would then be in the position that people could validly present cheques either in decimal currency or in £sd and this would add enormously to administrative difficulties. There is no reason to believe this provision will create hardship but its being there will certainly speed up the changeover to decimal currency and that is desirable. The shorter the changeover period the better. Everyone will, I think, agree on that because, if we do not have a dual system operating, there will be less likelihood of confusion.
I am thinking of the end of the financial year when someone pays his rates to 31st March in £sd and the cheque will be invalid unless it is changed by the payee. Rate collectors might lose poundage.
Get it written out again.
It is the same as getting a cheque wrongly dated. That happens on occasions.
Suppose someone gets a cheque on Friday, 12th February, and it is dated 12th February; the banks will not be open on the Saturday, on the Sunday or on the Monday. How will that be dealt with? He cannot present the cheque until 15th February.
The banks will be closed on the 11th, 12th and 13th and 14th.
That is the trouble.
That is covered by section 4 and by the fact that it would be presented, as the Deputy visualises, immediately after Decimal Day. It would be similar to a cheque bearing the incorrect year. I think there will be a limited service provided by the banks on these days.
Deputy Kavanagh asked about a cheque made out in £sd and the Minister said it would be the same as a cheque wrongly dated. In the circumstances he described, a wrongly dated cheque should be fixed up straight away with the person who wrote it and should be rectified. It cannot be rectified in this case unless you find the person. He would have lodged the cheque. It is completely wrong. The rate collector would not get his poundage or whatever it was——
I understood £sd cheques written after Decimal Day to be invalid. The practical problem Deputy Tully was talking about is covered by section 4 which enables the conversion to be made.
In the banks?
Yes.
How can a bank change anybody's cheque? I would not let them change mine.
I would refer to section 4.
I have in mind a rate collector who is getting a number of cheques on 31st March. He has some made out in shillings and pence. Perhaps they are posted to him. He lodges them. Some are returned.
Thereby, he loses poundage or bonus, say, up to £100, because he did not reach the required figure. Is there any way in which he can be allowed for the time lost in sending them back to the individuals who wrote them incorrectly?
I think section 4 covers that fully.
No. These are cheques which may have been drawn after Decimal Day.
After Decimal Day.
No. I cannot cover that except on the basis that it is, in practice, covered every year in January when this happens.
Would the easiest way out of it not be—if the Minister says he cannot change it—for everybody, coming up to and immediately after 15th February, to date their cheques before 15th February? Section 4 will let them out.
There will be a great deal of publicity to make people aware that on and after 15th February then-cheques should be written in decimal currency.
They will not be told they can get away with it by dating them before 15th February?
No.
We should tell them now. Question put and agreed to.
SECTION 3.
Question proposed: "That section 3 stand part of the Bill."
Why do the banks, who are the effective people involved here, require these three days? I do not understand. I realise there are three days of grace in connection with a bill of exchange, and so on. Is that the reason for this three days or is it just——
What is envisaged is that the banks would clear the pipeline during these three days. They will have to make up customers' balances. They will have to convert balances into decimal currency. Clearly, this is a major undertaking. There will be a limited service during those days. This is covering the legal liability of the banks.
The banks will, in fact, be open?
Yes. This has been publicised and will be publicised again as a service they are providing.
How is it that the banks shall close on 11th, 12th, and 13th February—that these shall be non-business days—in view of the fact that they have been closed for the past six months without the Minister's authority?
The term "non-business days" has a legal significance.
Is it likely that the banks will be able to meet this?
My information is that they will. I take it the Deputy is thinking of their current difficulties?
Yes.
I am informed that they are confident they will.
Will we all know, in terms of decimal currency, how much we are in "the red"?
In a retail business, where you will be getting in the old and new money, how do you work this out? Do you refuse the old and just take the new?
No. During the change-over period—from 15th February until the end of the change-over period— both currencies will be in circulation.
One would need to be a Houdini to give the proper change.
A great deal of work has been done by the committee with retailers on this. They have issued booklets. Once one has a look at them and gives a little thought to it, one will realise it is not nearly as difficult as might be feared. I think it will be all right.
Question put and agreed to.
Sections 4 to 8, inclusive, put and agreed to.
SECTION 9.
Question proposed: " That section 9 stand part of the Bill."
What is the legal position with regard to wills in which sums of money have been mentioned in sterling?
There is provision for that in section 14 (1) (b). " Instrument" includes wills, documents, and so on.
Question put and agreed to.
Sections 10 to 13, inclusive, put and agreed to.
SECTION 14.
Question proposed: "That section 14 stand part of the Bill."
There again, it seems to reinforce some particular meaning that is being given to " invalid ". We go back on section 2. I am just a little bit concerned about it.
What is the Deputy's view of a cheque which is presented for payment more than six months after the date on its face? Would he describe that cheque as " invalid " or what word would he use?
As a direction to the bank, it is not enforceable unless the bank is willing to carry out the payment. Possibly " invalid " is all right. It may be tied up with the Bills of Exchange Act. Presumably the draftsman may be using it because it has a particular meaning. However, " invalid " would seem to me almost to imply a nullity; in other words, that it could not be corrected.
I have undertaken to Deputy Tully to have a look at this and if necessary to move an amendment in the Seanad but my own belief is that the position here is the same as it is in relation to cheques presented more than six months after date.
" Invalid " is the word; I agree with Deputy O'Higgins. Deputy O'Higgins would have more experience of this than I would. I do not know how a court would deal with " invalid ". If a cheque or document is invalid, it is null.
I think that is correct.
I am trying to recall legal terms but I have some idea that there is another term.
It is rather like a contract which may be voidable at the option of the person who takes advantage of the rub of the green or whatever it may be, but "void" means that you cannot do it.
I think "invalid" is an in-between term. At any rate I have undertaken to examine this and if we find a different term preferable, for instance, the one used in relation to cheques, I would undertake, if it is possible, to insert that in an amendment in the Seanad.
Question put and agreed to.
SECTION 15.
Question proposed: "That section 15 stand part of the Bill."
The Minister knows the existing position and it seems to me that there is an abnormal increase in the number of small coins that may be tendered. It may be very convenient to lump them all together in this fashion but my recollection is that at present you may tender copper coins up to 12 pence legally and silver coins, or what were silver coins, up to 40s. Under these provisions now you may tender shillings, five new pence, up to £5. This is all right from the banks' point of view when the coins are made up in packets but, take the example that you may now tender 100 shillings, 100 pieces of five new pence in payment of a bill. We hear jokes about what cranks do to "to get one over" on somebody they dislike by dumping a large bulk of coins on him. The present penny is five-twelfths of a new penny and it may be tendered to the extent of 20 new pence or 4s. That means the equivalent of 48 existing pennies and you could tender 48 of these coins to pay an amount of 4s or 20 new pence. This seems to me to be an undue extension and it will give opportunities to people to make a nuisance of themselves.
The old legal tender limits were 1s for bronze coins and 40s for cupro-nickel coins. After some examination of the matter it is believed that these provisions are really more in line with present day conditions. The old pennies will go out of circulation. One may take the view Deputy O'Donovan takes but one may argue both ways. The Deputy will appreciate that as in most cases, we are trying to meet conflicting rights of two parties. I do not think I would be in a position to say positively that one was right and one wrong but it does not seem an unreasonable provision here.
There are 40 new halfpence in 20 new pence and therefore you can tender 40 of these small coins. We know from pictures we have seen that they are relatively small. To meet my point of view admittedly, you might, instead of having three categories be obliged to have five categories but, making it possible for a person legally to tender 40 new halfpence, 40 coins of a new halfpenny in value, seems to me to be a big extension compared with the position when even with the old halfpenny, which is now gone out of existence, you could legally tender 24 of them theoretically. You could legally tender 48 farthings when they were there, as that would be within the limit of copper coins up to one shilling. The new halfpenny is equivalent to 1.2 existing pennies and, despite inflation, I hope they will remain of some value in the future currency system. Perhaps the Minister would look into that situation. It would be relatively easy to have a different number of categories, say four instead of three. You would not have to go very far. If it is legal to tender the new five-pence, value 1s, up to £5, that would mean 100 coins, a very big number compared with the 40 at present. I am really asking why must we have this relatively great extension in the number?
The new bronze coins are lighter than the present ones so that the burden would not be too great for somebody being paid. The Deputy referred to this in passing when he mentioned the existing limits and said that "theoretically" one would be obliged to take so much in certain coins. This is true. We are talking of a theoretical situation. So far as I can recollect I never came across a situation where somebody, under the old legal limits, said "That is legal tender; you must accept it." I know it happened; I have heard of it. It is a very rare situation and I doubt if many Deputies came across it.
It is quite common in shops.
I think it happens only rarely that people will argue "You must take it that way."
Question put and agreed to.
SECTION 16.
Question proposed: "That section 16 stand part of the Bill."
What is it we are repealing there?
It is the legal tender provision of the 1950 Act.
Question put and agreed to.
Section 17 put and agreed to.
Schedule agreed to.
Title agreed to.
Bill reported without amendment, received for final consideration and passed.
Is this a money measure?
No, strangely enough.