The amendments have been put down to meet the situation arising from decisions of the courts in two cases, Schmidt v. Christie and Kerr v. Bride, in which it was held that where a landlord charged and a tenant willingly paid a rent which did not exceed the standard rent by more than the increase permitted under the Act, and the landlord had not complied with certain technical points, such as service of notice to quit, or the statutory notice to increase the rent, the tenant could recover such permitted increases paid by him, either by action, from the landlord or by deduction from rent accruing due by him. It was considered inequitable that a tenant should be able to recover in this manner the permitted increases willingly paid by him, and the section under consideration accordingly removes the technical grounds on which this recovery could be made. But the section as it stands, unlike the Deputy's amendment, recognises as an accomplished fact all sums recovered by tenants in that way prior to 4th May, 1926, the date of the introduction of this Bill.
The Bill as it stands, unlike the amendment, does not attempt to re-open these transactions. I have my own view about these transactions. It would probably be no less strong than the view of the mover of the amendment. I think it is wholly wrong and wholly inequitable that, after a tenant had agreed willingly to pay a particular rent, no greater than the increase permitted under the Act, he could then recover from the landlord, availing of a technicality, the amounts so paid because of the failure of the landlord to determine the tenancy by means of a notice to quit, thus creating a new statutory tenancy under the Act. But, unlike the Deputy, I have not thought fit in the Bill to attempt to re-open all these transactions. Deputy Good does not shrink from it. His amendment attempts that very thing. He wishes by his amendment to enable the landlord now to recover from the tenant all sums which the tenant may have recovered from the landlord, on these technical grounds, since the 22nd June, 1923. If carried, the Deputy's amendment would mean that probably a thousand odd judgments, given by the courts since June, 1923, and based on the then existing law as interpreted by the courts, would be set aside and discharged, notwithstanding that those judgments had, in fact, been executed or satisfied.
We had a good deal of talk lately about the undesirability of retrospective or retroactive legislation. Deputies had better realise that this amendment would be retroactive legislation with a vengeance. It would create a position in which moneys actually paid by a party to a party under a judgment of the courts, would have to be repaid in accordance with our legislation. The tenants, who recovered moneys on these technical grounds, utilised the law as it was found to exist at the time, and the recovery of those moneys by the aid of the court, ought not now, in my view, be nullified, whatever we may think as to the fairness, as between man and man, in seeking the recovery of those moneys by legal processes.
The Deputy may urge that a distinction might, perhaps, be drawn between those cases in which the tenant recovered through the machinery of the court and those other cases brought to my notice, in which they simply deducted from the rent the increases which they had paid to the landlord when they discovered the technicality that the landlord was not entitled to charge in certain cases without terminating the tenancy by a notice to quit. Some tenants set the machinery of the law in motion, secured favourable decisions, and actually induced the landlord to recoup moneys paid by way of increase of rent. Other tenants merely figured out what the amount of such increases were, and deducted that amount from their rent. In many cases some people paid no rent, and said: "I do not have to pay any rent because the amount of my rent is due from you to me in respect of increases which were charged, and which were not legally chargeable owing to the fact that there was an omission to serve a notice to quit."
No distinction is possible, I fear, between the cases where the actual machinery of the court was utilised and those other cases where the tenants simply deducted the increases from their rents. If we are not to reopen court judgments then other transactions ought not to be reopened. House-owners, from whom recovery was made in the courts are, in fact, in a worse position than those who lost increases by the tenant who deducted them from his rent, because, in addition, they had to pay the costs of litigation. My position is this: while recognising the underlying injustice of the case from the point of view of individuals, while recognising it was not equitable that tenants should avail of a legal technicality to recover moneys which they agreed to pay, I shrink from asking the Dáil to accept an amendment which would mean striking back into the past and reopening a very large number of judgments of the courts. I feel that it would not be proper to attempt to reverse court processes in that way, because that is what would be achieved by the amendment.
I see no possibility of securing redress for those other house-owners who were not actually brought into court in litigation, but from whose rents the increases were subsequently deducted by tenants. The whole matter is a very difficult one and one which had been of grave concern to me at the time. It is true, as Deputy Good states, that a particular section of the Principal Act of 1923 failed to effect what, in fact, was desired, and intended by it—failed to effect what the British Act of 1923 effected after it was found by the judgments in Schmidt and Christie and Kerr and Bride that there was that technical loophole for tenants who had voluntarily agreed to pay increases in their rents not greater than the increases under the Act.
The British introduced legislation in 1923 which effectively covered that flaw. In our legislation of 1923 we desired and intended to effect a remedy for that position but the language of the Act failed. We cover the point in this section, but we are not doing what the Deputy asks, namely, to strike back as far as June, 1923, and reopen all the transactions which were dealt with under the law as it was found to be then, when interpreted by the courts. Our proposal is to date the effect of the section as from the introduction of this Bill, and we are not asking the Dáil, because we do not see any way to do it that would be, in our view, sound and proper, to provide any redress for those house-owners who suffered through a flaw in the legislation of the past. Their wrong—and it is a wrong—amounts to this, that their real position is that they were unable to secure any increase in their rent; that where they agreed with their tenants to pay an increase and did not go through the legal processes set out in the Act of 1920, namely, by means of a formal notice to quit, notice to increase rent, and so forth, the tenants subsequently discovered that such increases were not legally chargeable owing to the absence of notice to quit.
Many tenants took advantage of that technicality and either went into court and recovered these increases from the landlords or took the other course of deducting them from the rent, sometimes paying no rent until the amount of the increase so paid was exhausted. These flaws in our legislation—first of all the flaw in the British Act of 1920, and then our failure to remedy that in our Act of 1923—have meant very serious loss to individuals, and the difference between myself and Deputy Good would only be this, namely, that whereas I recognise that fact and have very considerable sympathy with those individuals, I, unlike the Deputy, shrink from asking the Dáil to sponsor a piece of legislation which would reopen many hundreds of court judgments and reverse the processes of the court.
Parliaments will fail from time to time to effect what they wish to effect in their legislation, and these errors will be discovered afterwards, sometimes perhaps soon afterwards, and sometimes, perhaps, not for many years afterwards, when the thing is tested in cases before the courts. I do not think that it would be a sound precedent to set in our legislation here that, when errors of that kind are discovered, Parliament should proceed forthwith to strike back over that period, however long or short it may be, and deal with all the reactions of the original error. It would be a question of degree. It would be justified only by the proportions of those reactions, and, when I speak of proportions, I must be taken as speaking of their proportions to the community at large, to the State fabric as a whole, rather than of their proportions to the individual. I have been shown definitely in black and white that these flaws in legislation— the flaw in the 1920 Act, as passed by the British, and the flaw in our Act of 1923 in failing to cover that—have had the gravest financial consequences for individuals in Dublin and throughout the country. It is in face of that knowledge and in face of any sympathy which I feel for individuals that I ask the Dáil not to pass Deputy Good's amendment.
