However the sitting Tory MP, Sir H M Mallaby-Deeley, resigned in 1923 causing a by-election which was held on 3 March 1923.

Johnstone was again chosen to contest the seat for the Liberals and won by a majority of 5,176 votes over the Conservative George Frederick Stanley.

In May 1940, even though Johnstone was outside Parliament, Winston Churchill decided to appoint him to the government as Secretary to the Department of Overseas Trade.

[5] Two months later the Liberal constituency of Middlesbrough West became vacant when the sitting MP, Frank Kingsley Griffith, was made a county court judge[6] and Johnstone was returned for the seat at a by-election on 7 August 1940 unopposed under the terms of the wartime electoral truce.

During the National Government after 1931 he remained a faithful member of the Samuelite Liberals, always supporting the traditional policy of Free Trade against protectionism.

Johnstone's unexpected return to government and Parliament in 1940 came about mainly as a result of his closeness to Sinclair and his friendship with Churchill.

[9] A memorial service was held for him at the Church of St. Margaret, Westminster on 13 March attended by the prime minister and Clementine Churchill, Clement Attlee (deputy prime minister) and Anthony Eden amongst prominent government mourners.