I. REPEAL OF SECTION 10
5.1 All the law reform agencies which have considered s6 of Lord Tenterden's Act at some length recommended that it be repealed. No consideration was given by them to prolonging the life of the section by amending it. This reflects the fact that the section has outlived its usefulness. The mischief it sought to prevent in 1828 has no relevance today, especially in New South Wales where the Statute of Frauds has been repealed. The section does not perform any useful function. On the contrary it merely provides a shield for fraudulent oral representations. The rigid interpretation of the requirement of writing has resulted in corporations taking cover behind its provision and escaping liability for the acts of their agents. There is no valid reason for retaining the section, even in an amended form.
5.2 1t is therefore recommended that s10 of the Usury, Bills of Lading, and Written Memoranda Act 1902 be repealed. The repeal of the section would remove from a defendant who makes a fraudulent oral representation an unfair advantage over a defendant who makes a negligent representation, placing both on the same footing. The repeal of the section would also result in the general law of vicarious liability applying to the acts of an agent of a corporation, thus making a corporation liable for the fraudulent representations as to credit of third parties made by an agent. Finally it would remove from the Statute Book a provision which has outlived its usefulness.
II. REPEAL OF SECTION 12
5.3 As a consequence of its recommendation to repeal s10, the Commission also recommends that s12 of the Usury, Bills of Lading, and Written Memoranda Act be repealed. Section 12 provides:
No memorandum or other writing made necessary by section ten shall be deemed to be an agreement within the meaning of any Act relating to stamp duties.
5.4 Our research has revealed no reason to retain either s10 or s12 for stamp duty purposes1 and the Office of State Revenue in the NSW Treasury has advised that it has no objection to the repeal of s12.2 On the repeal of s10, s12 will serve no purpose and should be repealed as well.
III. NO RETROSPECTIVE OPERATION
5.5 Whilst it is difficult to see how it would wish to adjust its practices to conform to the law following repeal of s10, we believe that an opportunity should be given for the business world to become aware of the change before being subjected to it. The Commission therefore recommends that the repealing legislation should operate prospectively only. Representations made before the date of commencement of the repealing legislation should not be affected by the repeals.
FOOTNOTES
1. The equivalent provision in England, Statute of Frauds Amendment Act 1828, s8, was repealed by the Limitations Act 1939 (UK) while the equivalent of s10 (Statute of Frauds Amendment Act, s6) remain in force.
2. Letter dated 19 May 1988 from Office of State Revenue to the Chairman of the Commission.
