I desire to point out that there have just been circulated five new amendments to the Report Stage of this Bill. It is not possible to examine these amendments before the discussion takes place. I think it is desirable that Deputies should have an opportunity at least to read the amendments and compare them with the Bill before entering on a discussion on the Report Stage, because later the Bill cannot be amended.
AGRICULTURAL CREDIT BILL, 1927—REPORT STAGE.
What amendments does the Deputy refer to?
I have two pages of typewritten material here that were handed to me at 3.5 p.m. I do not know what the amendments refer to. Some of them are in the name of the Minister.
These are amendments introduced without notice. They cannot be taken without agreement.
Does that ruling apply to all the amendments?
Only to the amendments that were handed in this morning.
May I point out that amendment 4a in the name of Deputy Heffernan is an amendment which was debated in Committee?
We do not know what Deputy Heffernan's amendment is. We have not had an opportunity of reading these amendments, and we do not know what they refer to. We cannot read them and attend to the business of the Dáil at the same time.
I agree with Deputy Johnson that it is very difficult to read amendments and to attend to business as we are expected to do, but Deputy Heffernan has down an amendment— 4 (a)—which was under discussion in Committee, and in connection with which I think the Minister has gone some way to meet him in amendments on the green paper. The other amendment in the name of Deputy Heffernan —12 (a)—was also discussed, because something very like it was down on the Order Paper for the Committee Stage. In face of that I think it would be unfair to rule these out of order.
The position is that amendments which were received only this morning for the Report Stage of the Bill cannot be taken unless there is some measure of agreement. They are in the position of amendments moved without notice. I am prepared to allow them to be taken, not to rule them out of order summarily, but we must have some kind of agreement to take them. That will apply, of course, to Deputy Heffernan's amendments.
I would appeal to Deputy Johnson to allow the amendments to come before the House, because, as Deputy Baxter says, amendment 4 (a) is a repetition of an amendment we discussed in Committee, and which I stated I would introduce on Report. No. 12 (a) also arises out of a discussion in Committee. This discussion took place last Thursday, and the time at my disposal to consider and draft amendments was very short, with the result that I got these drafted only on Monday, and I presume they reached here yesterday, although I am not quite sure. The time between the Committee and the Report Stages was very short, and did not allow very much time for drafting, but I do not object to the Report Stage coming on at such an early date in order to meet the wishes of the Government in regard to business.
I quite realise that amendments circulated now cannot be taken without consent, but some of these amendments, notably Deputy Heffernan's, are to deal with points I have already attempted to deal with in the amendments on the green paper. If the Dáil insists we can take the few amendments that are in the name of the Minister for Finance, but I would suggest that Deputy Johnson should postpone the statement of his attitude on that question until the end of the Report Stage, because the amendments that are down in my name are purely formal, and are machinery amendments.
It may be all right to take the Minister's assurance, but if these amendments are passed without an opportunity for us to read them the Bill cannot be amended on the final stage, and the eventuality will be that the Bill will become law, and that Deputies, who are ultimately responsible, will have allowed these amendments to pass into law, and will not have had time even to read them. This applies to other Bills. We have had substituted lists in respect of the Currency Bill, and these are coming on in the last two or three days of the existence of Parliament, in respect of a very important Bill. I take it that Ministers are responsible for this, and I say that it is not a creditable way for them to conduct their business. We received this morning a list of amendments to this Agricultural Credit Bill, most of them being Ministerial amendments. That was all right; they were late enough, but still we have had an opportunity to look at them. But following upon that, at 3 o'clock this afternoon we got another list of amendments. I say it is impossible to conduct the business of the Dáil under these circumstances. I urge that the amendments on the white paper be not taken to-day, that the decisions that are to be taken shall be merely on the green paper amendments, and that we defer discussion on the other amendments until to-morrow.
Does that apply to all these amendments?
I do not know what they are, and, therefore, I cannot speak about them.
I suggest that it is no good dealing with one part of the Bill to-day and another part to-morrow. There are three important measures on the Order Paper for to-day, the Appropriation Bill, on which any Deputy can speak on almost any subject that may enter his head; the Industrial and Commercial Property (Protection) Bill, and the Finance Bill. We got this morning not less than four sheets of amendments to other important Bills, all of which amendments require to be read in conjunction with the Bills, and it is not asking the Dáil to act with a due sense of responsibility to rush matters in this way. The Finance Bill amendments are all pretty clear, and I would be quite willing to go on with them. The Appropriation Bill is one which does not require amendments, and can be discussed, and the other Bill from the Seanad is also one that we might reasonably go on with, and that would give us quite as much work as we can do to-day.
I think there was more than a week—ten days—between the Second Reading and the Committee Stages of this Bill, and at least seven days between the Committee Stage and the Report. The amendments on the green paper are in order, and may be considered to-day. Deputy Johnson is quite entitled to say that the other amendments should not be considered until to-morrow. Consequently, we will go on with the amendments on the green paper, and then I will ask the House to adjourn consideration of the balance of the Bill until to-morrow.
The amendments on the green paper deal with practically the whole Bill. We will go as far as the chattel mortgages, and Deputy Heffernan has an amendment on the white paper to Section 12 which would have to be discussed in conjunction with the Minister's amendment. It was discussed on the last day, and in fact notice was given by Deputy Heffernan that it was his intention to introduce it.
Is the Deputy's point that in view of the fact that we will get down to chattel mortgages, previous sections cannot be dealt with until to-morrow and that consequently an amendment of Deputy Heffernan's cannot be reached?
I submit that if you go as far as Section 12, the section dealing with the Memorandum and Articles of Association——
The green paper goes to Section 24.
Deputy Heffernan has an amendment to Section 12, which we debated in Committee. If you pass Section 12 to-day will we be in a position to go back to it to-morrow?
Supposing we take the amendments on the green paper, allow the other amendments to be explained, and after explanation, if opposition is taken, postpone them until to-morrow, but if no opposition is taken when they have been explained, take them to-day. In connection with Deputy Baxter's point on amendment 4 (a), it could perhaps be taken with the Minister's amendment.
Mr. HOGAN (for Minister for Finance)
In page 2, line 30, Section 2, to insert immediately after the word "includes" the words "the breeding, rearing or keeping of animals of any kind (including birds and insects), dairying and" and immediately after the word "animals" to insert the words "and cognate words shall be construed accordingly."
The Section will then read:—
The word "agriculture" includes the breeding, rearing or keeping of animals of any kind (including birds and insects), dairying and the pasturing of animals and cognate words shall be construed accordingly.
Insects will include bees.
The Minister has explained that the word "insects" means bees, but does it mean bees only?
It means a good deal more.
I can understand the word "agriculture" including a particular kind of insects that I once had the pleasure of seeing perform— performing fleas. Under this definition an agriculturist might be a person who breeds fleas to perform.
That is so, but this is an example of the fact that it is extremely easy to criticise and to suggest weaknesses in definitions, but when you come down absolutely to definitions that would exclude everything you do not want and embody everything you do, the difficulty starts. I am not concerned if I include performing fleas. What I am concerned with is that I include everything that should be included as a particular service for which the Agricultural Credit Corporation can give a loan, and when the draftsman and the lawyers got at it they decided that it would be very difficult indeed to have a definition which would include every possible development and at the same time exclude particular types of activities which were never intended to be dealt with. But we have a safeguard in the Corporation itself. I doubt very much if the directors would make a loan to a gentleman who was breeding performing fleas, or white mice, or red foxes.
In page 3, line 8, Section 3, after the figures "1924" to insert the words "not later than the 30th day of September, 1927," and to delete all words from and including the word "and" in line 9 to the end of the section.
The section will then read:—
Immediately upon the passing of this Act the Minister shall take all such steps as appear to him to be necessary or desirable to procure that a limited company (in this Act referred to as the Corporation) conforming to the conditions laid down in this Act shall be formed and registered under the Companies Acts, 1908 to 1924, not later than the 30th day of September, 1927, to perform the functions specified in this Act.
That means that the Memorandum and Articles of Association shall be prepared and everything shall be ready except the actual issue of the shares. It was considered that there were contingencies in connection with the paying up of the share capital that could not be now foreseen, and that it was not safe absolutely to tie ourselves to the 31st December, 1927, for the commencement of the operations of the Company. We have not, after all, absolute control over the processes from the publication of the Memorandum and Articles of Association up to the receipt of the share capital. We have control over everything before the Memorandum and Articles of Association are prepared. That is the responsibility of the Minister for Finance, and he can safely bind himself to have the Articles and Memorandum prepared before September 30th, 1927. But we regard it as unwise to insert a definite undertaking that the money shall be subscribed, that a number of details, some of them over which he may have no control at all, shall be settled before the 30th September, 1927, and we consider it more satisfactory to say that the Memorandum and Articles of Association should be prepared not later than the 30th day of September, 1927.
We will take a statement on amendment 2 (a) without prejudice.
In page 3, Section 7, to delete sub-sections (1) and (2) and substitute the following sub-sections:—
(1) The Corporation shall pay to its members dividends at the fixed rate of five per cent. per annum on the amount of its capital for the time being paid up and such dividends shall be paid by the Corporation half-yearly on such dates as shall be appointed for that purpose by the directors with the approval of the Minister.
(2) If on any of the days appointed under this section for the payment of half-yearly dividends the Corporation have not any or sufficient money available for the payment of the dividend so payable on such day the Corporation shall forthwith certify to the Minister the sum which with the moneys (if any) so available is required to pay such dividend and upon receipt of such certificate the Minister shall advance to the Corporation the amount so certified by the Corporation and the moneys so advanced shall be forthwith applied by the directors in or towards payment of such dividend.
There is absolutely no difference except to specify that it shall be paid on such dates as are decided by the Minister. This is just the same thing in different phraseology.
Is objection taken to amendment 2a being taken to-day?
Consideration of amendment deferred.
Notice having been taken that twenty Deputies were not present, on the division bells being rung and the House counted twenty members were found present.
I move amendment 3:—
In page 4 to delete Section 9 and substitute therefor a new section as follows:—
"(1) The objects of the Corporation shall be so stated in its Memorandum of Association that the principal functions of the Corporation shall be the lending or advancing (subject to the restrictions imposed by this Act) of money upon such security as the directors may, subject to the provisions of this Act, think proper, the discounting and purchasing (subject to the restrictions imposed by this Act) of bills of exchange, promissory notes, and other negotiable instruments, the receipt (subject to the provisions of this Act) of deposits of money, the receipt of deposits of securities for safe-keeping and management and, so far as may be lawful, the execution of trusts in relation to such securities.
(2) Nothing in this section shall prevent or restrict the inclusion among the objects of the Corporation as stated in its Memorandum of Association of all such objects and powers as are reasonably necessary or proper for or incidental or ancillary to the due performance of the principal functions aforesaid and are not inconsistent with this Act."
There is really only a drafting difference between Section 9 as it stands and the new section. There is just one point about it. Section 9, as amended, makes it perfectly clear in sub-section (2), for instance, that the Corporation shall have the power to invest money for the purpose of its operations. It was not absolutely clear that the Corporation would have power to invest money under the section as it stood, though one would say that sub-section (c) would enable the Corporation to invest money temporarily if it were necessary for the purpose of its operations. It is made quite clear, however, by sub-section (2) of the amendment. It is quite obvious that a bank will occasionally have to invest portion of its share capital or capital obtained in other ways for very short periods in outside security. Otherwise there is no change.
Could the Minister say, if otherwise there is no change, why it has been found necessary to make a complete change in the drafting? I see that the original proposition was "that the Corporation shall be entitled to perform and fulfil the following and no other functions, that is to say." Then followed sub-sections (a), (b), (c), (d) and (e). The new section is a complete redrafting, saying that the principal functions shall be so-and-so. I am sure there must be some other reason for this besides the one the Minister is giving.
There was some doubt as to what the meaning of "no other functions" was there, and whether it really meant that the principal functions of the Corporation should be as set out in (a), (b), (c), and (e). These are set out also in the amendment, but they are brought together and set out in a shorter form in sub-section (1). The Deputy will find them set out there, but in different words. They are brought together and not set out seriatim. There is the change that the words "no other functions" are taken out and "principal functions" are put in. That was to make it conformable to sub-section (2), the intention of that being to enable the Corporation to invest money, even though it is not specifically set out. If you said "no other functions," it might be doubtful whether the Corporation could, in fact, invest money even temporarily—in other words, whether, if they get the share capital, they would have to keep it in a strong box instead of investing it for a couple of days, or a week, or whatever they may require. The words "no other functions," together with the drafting of that section, made it, in the opinion of the lawyers, somewhat doubtful whether the Corporation could invest its money for a short period for convenience. It was to meet that point that the drafting was changed—"no other" was taken out and "principal" put in.
This change of drafting is not very clear to me. The whole section has been changed. The original section had five clauses in it, and in the amended section we have two sub-sections. I am not sure whether they will cover all the matter covered in the original section. I have not been able to follow very clearly the Minister's explanation. He has been referring at lightning speed to changes in the section which I have not been able to follow very clearly. Why not retain the original section with verbal changes made with regard to "no other functions?" It seems to me the objects of the Corporation are very much more clearly and easily understood in the original section, and I cannot see the advantage of the change made by the new section. I think the Minister, in his explanation, has jumbled up the numbers in the amendment and in the original section. He spoke about sub-section (2). Apparently he means sub-section (2) of the amendment, not of the original section, in which there is only one sub-section.
Yes, there is no sub-section (2) of the original section.
The Minister spoke of sub-section (2) of the section.
There is only sub-section (2) of the amendment.
I spoke about sub-section (2) of the amendment. If the Deputy is not clear whether all the objects are set down in the amendment, all he has to do is to read the amendment.
We got very little time to read them.
These amendments were in in time.
I want to make a protest against the way we are being flooded with amendments of all kinds in connection with Bills. We do not want to obstruct the Minister in getting the Bill through, but we want to understand that in accepting this section we are accepting nothing different to the original section, except in so far as specified by the Minister. I think we have a right to get an opportunity of understanding that.
If I only knew what the Deputy wanted I would try and satisfy him, but I do not know. I have stated that the objects are covered by the amendment. The Deputy got the amendments this morning in time and in order. There may be something troubling the Deputy, but I do not know what it is. If he would only express it I would try to meet him.
I move amendment 4:
In page 5, Section 12, to insert at end of sub-section (2) the following words:—
"Every order made by the Minister and the Minister for Lands and Agriculture under this sub-section shall be laid before each House of the Oireachtas as soon as may be after it is made and unless either House shall, within twenty-one days after the first day on which such House sits after such order is laid before it, pass a resolution annulling such order such order shall come into operation at the expiration of twenty-one days from whichever of the following days is the later that is to say the first day on which Dáil Eireann sits after such order is laid before it or the first day on which Seanad Eireann sits after such order is laid before it."
This is to deal with a point that was debated at great length on the last occasion—that is to say restriction or extension of the Articles of Association. The amendment says that every order made under this sub-section shall be laid before each House. The sub-section referred to is sub-section (2) which states:—
The Memorandum and Articles of Association of the Corporation shall also be so framed and expressed that the persons to whom and the purposes for which the Corporation shall be entitled and authorised to lend or advance money as stated in such Memorandum and Articles in pursuance of this section may be varied (whether by extension, restriction or otherwise) from time to time....
The amendment says: "that is to say, the first day on which Dáil Eireann sits after such order is laid before it or the first day on which Seanad Eireann sits after such order is laid before it." It is not twenty-one sitting days. The order shall be laid on the Tables of the Houses, and it shall come into operation twenty-one days after the latest date, the latest date being twenty-one days after the first day on which the Dáil sits, or twenty-one days after the first day on which the Seanad sits, whichever is the later. I think that meets the difficulty that it is not exactly correct that there should be a restriction of the objects as specified in the Memorandum and Articles of Association at the discretion of the two Ministers, and it meets the point that if there is such restriction both Houses should have an opportunity of having their say on it, or approving of it, as the case might be.
This amendment satisfies me, and I am willing to withdraw my amendment (4a) with the leave of the House.
I move amendment 5 on behalf of the Minister for Finance:
In page 5, line 67, Section 12 (3), to delete the word "agricultural," and in page 6, line 1, to delete the words "produce nor" and substitute therefor the words "actually or usually produced by that society nor are."
I think the Minister is making a mistake in amending this sub-section. The object is one which will not be a real advantage, but I do not want to discuss that issue. The Minister has made it clear that he believes the Corporation should not lend money to a Society which engages in retail trading. I doubt whether the proposed amendment would really effect what the Minister desires without doing harm to some societies and some members of societies. Under the section, as it will be amended by this proposal, a society receiving eggs and whose business is to market eggs on behalf of its members, would not be in a position to sell to any of its members any other eggs. It would not be able to send out one dozen or two dozen eggs to one of its members without debarring itself from the privileges of the Bill. I do not think that is desirable. I think a society ought not to be restricted in that narrow way, and I would suggest some phrasing which would include "dealing in" on behalf of its members instead of "produced." Right through the Bill is the idea of a creamery as an organisation that is producing——
If I may interrupt the Deputy, I raised that specific point with the Legal Department, and it is their opinion that such a society would be held to produce the eggs, and that it could sell, say, one dozen eggs to anybody to whom it wished to sell them.
The law has had the reputation of being a four-legged animal for a long time, but to find that a society is producing eggs because the members of the society produce eggs comes as a surprise to me.
I saw the difficulty. Producing is one thing and collecting another. I raised that point specifically with the Legal Department and I was assured that it was clearly covered.
If the Minister is satisfied, I am satisfied.
The interpretation of the Legal Department may not be the interpretation which the courts will place on the sub-section. I doubt very much if the Department's interpretation is correct.
I want to register formally my objection to this amendment. The principle was discussed last week—the principle of advancing money to co-operative societies which are selling retail articles necessary for agricultural production. We divided the House on the question then, and I merely want to register my objection now.
I move amendment 6, on behalf of the Minister for Finance:—
In page 6, line 7, Section 12 (4), to delete the word "person" and substitute therefor the words "co-operative society or company," and in lines 8 and 9 to delete the words "agricultural produce nor" and substitute therefor the words "actually or usually produced by that co-operative society or company nor are."
The first portion of this amendment is to meet the case of a co-operative society selling to one of its members. The alternation in lines 8 and 9 is to make this sub-section conform with the previous sub-section. The word "person" is taken out in order to make it quite clear that the society may sell its produce to an individual member of the society, but that alteration is not really necessary.
I move amendment 7, on behalf of the Minister for Finance:—
In page 6, before Section 13, to insert a new section as follows:—
The Memorandum and Articles of Association of the Corporation shall be so framed and expressed that—
(a) the Corporation shall not be entitled to receive deposits of money or deposits of securities for safe-keeping and management from any person except co-operative societies, and
(b) that the Corporation shall not be entitled to receive deposits of money repayable on less than thirty days' notice or on demand or against cheques.
This amendment should be taken in connection with Section 9, which sets out the objects of the Corporation. This is a limitation, and it is in the form of a new section, before Section 13. Clause (a) represents the exact recommendation of the Banking Commission. The point of view has been put up on behalf of the banks that this Corporation should not take deposits from individuals. On consideration, I am in agreement with that, mainly for the reason which I will state. In my opinion, deposits would be of very little use to the Corporation. Its function will be to deal with long-term and intermediate-term credits. Deposits would be "on call" or on short notice and it would be of doubtful advantage to provide that the Corporation should take deposits up to a maximum of, say, five times its paid-up capital. Even if they got one million or two million pounds, only a very small proportion of these deposits could be lent on long terms or intermediate terms.
You have two sides to the question. On the one side you have the ordinary banks objecting to this Corporation taking deposits. You have then the report of the Banking Commission, which sets out that deposits should only be taken from co-operative societies. On the other side, it does seem clear that deposits would be of doubtful advantage to the Corporation, its entire business being in long-term or intermediate-term credits. Even if we limited deposits to two million or three million pounds, it seems clear that only a small proportion of these deposits could be used for the ordinary operations of the Corporation. It would be merely an investment function on behalf of the Corporation.
Sub-section (b) deals with a slightly different point. It is considered that it would be safer for the bank if the deposits which it obtained were only subject to call on 30 days' notice. That would enable them to make more use of the deposits and would safeguard them.
I want to object to this amendment, in conformity with my attitude in Committee. I cannot help feeling that the explanation which the Minister gave is not the real explanation, which, in my opinion, is that the joint stock banks object to this form of competition, if it could be called competition.
I actually gave that as one reason.
Well, you did not emphasise it. The closest analogy which I can make to this Corporation is certain mortgage corporations in the United States and Canada which finance themselves, to a certain extent, by taking money on deposit which can be withdrawn on notice, and, in some cases, on demand. I do not know whether customers have the right to withdraw on demand, but as a custom they are allowed to do so. That system is found workable because, as the money comes in, the loans are being repaid, so that the Corporation has liquid assets available to meet deposits. If there are limitations as to the amount, and restrictions specifying that notice has to be given, I think there is no danger that the Corporation will not be in a position to meet demands for the repayment of deposits. I maintain that the fact of allowing the Corporation to receive deposits from individuals will place it in close touch with the ordinary people of the country and will make it better known and more popular. The statement made by, I think, Deputy Alton, that the acceptance of deposits would add additional expense to the work of carrying on the Corporation has, I believe, very little in it. I believe that the additional expense would be very slight, as the work of looking after deposits is very simple. I think that the idea in the amendment is unsound, and I am confident that the real and only reason for it is that the joint stock banks object to this form of competition.
I regret that Deputy Heffernan did not give the benefit of his advice to the Banking Commission, as, had he done so, we would have had a wonderful report. If the Deputy accepted the invitation to give the Commission the benefit of his enormous experience it would have been of great assistance, but, unfortunately, he neglected to do so.
I was not asked.
You were, and it is a loss to this problem of agricultural credit that you did not accept.
I am afraid the Banking Commission overlooked the importance of asking me to give evidence.
In page 6, Section 14, before sub-section (4) to insert a new sub-section as follows:—
"(4) Section 93 of the Companies (Consolidation) Act, 1908, shall apply to certificates of charge issued by the Corporation as if such certificates were debentures and for the purpose of such application but no other purpose a series of certificates of charge shall be deemed to be a series of debentures."
Debentures must be registered in a certain way, and the idea of this section is to see that certificates, or a series of certificates, must be registered in the same way as debentures. It does not make them debentures, but it provides that Section 93 of the Companies Act, which provides for the registration of debentures, shall also apply in this case.
In page 6 to insert before Section 15 a new section as follows:—
(1) In addition to any return required by the Companies Acts, 1908 to 1924, to be forwarded by a company to the registrar of companies, the Corporation shall furnish to the registrar of companies such other returns at such times and in such form as the Minister may by order prescribe.
(2) The provisions of sub-section (5) of Section 26 of the Companies (Consolidation) Act, 1908, shall apply to a default by the Corporation in complying with the requirements of any order made by the Minister under this section, in like manner as that sub-section applies to a default by a company in complying with the requirements of the said Section 26.
I think this amendment speaks for itself. Companies have to make certain returns under the Act, and it is obvious that, as regards this Corporation, in which the Minister for Finance and, consequently, the taxpayers have such interest, the Minister should be in a position to call for certain returns, and that any default in making them should entail the same penalty as in the case of default in making the other returns.
In page 7, line 8, Section 16 (3), to delete the word "bonuses."
This is purely a drafting amendment. I do not know how the word "bonuses" got in there.
In page 7, line 56, Section 18 (1), to delete the word "suffer" and therefor substitute the words "a fine not exceeding two hundred pounds or in the case of an individual and at the discretion of the court to."
This amendment is to provide for a fine.
In pages 8 and 9 to delete Section 20 and substitute therefor a new section as follows:—
20.—(1) As soon as conveniently may be after the formation and registration of the Corporation a register of chattel mortgages shall be set up in every Circuit Court Office and shall be thenceforward there kept and maintained in accordance with this section and the regulations made thereunder.
(2) Subject to compliance with the conditions prescribed by or under this section for the registration of a chattel mortgage, every chattel mortgage shall be capable of being registered within seven days and no longer after its date in the register of chattel mortgages maintained under this section in the Circuit Court Office serving the area in which the farm of the mortgagor is situate or, where such farm is situate in two or more areas served by separate Circuit Court Offices, in each of the several registers of chattel mortgages maintained under this section in the said Circuit Court Offices respectively.
(3) Any person party to a chattel mortgage (whether as mortgagor, mortgagee, or surety) or the legal representative of any such person may register such chattel mortgage within seven days and no longer after its date in any register of chattel mortgages in which such chattel mortgage is capable of being registered under this section and such mortgagee or, with the consent in writing of the mortgagee, such mortgagor or surety or his legal representative may at any time remove such chattel mortgage from any such register.
(4) Whenever the principal moneys and interest secured by a chattel mortgage are fully repaid the mortgagee shall forthwith remove such chattel mortgage from every register of chattel mortgages in which it is registered under this section.
(5) No chattel mortgage shall be of any force or effect unless or until it is duly registered in accordance with this section and the regulations made thereunder in the register or every register (as the case may be) of chattel mortgages in which it is capable of being registered under this section and a chattel mortgage so registered shall cease to be of any force or effect if and when it ceases to be duly registered in such register or every such register (as the case may be).
(6) The contents of any register of chattel mortgages maintained under this section shall not be published or disclosed nor shall any copies thereof or any part thereof be issued to any person save only and except—
(a) any person in the employment of the Corporation and duly authorised in writing in that behalf by the Corporation may at any time inspect and take copies of any such register or any part thereof; and
(b) any person in the employment of a recognised bank and duly authorised in writing in that behalf by such bank may at any time inspect and take copies of any such register or any part thereof; and
(c) an under-sheriff may at any time inspect the register of chattel mortgages maintained in a Circuit Court Office serving the area or any part of the area for which he is the under-sheriff; and
(d) any person in the service of the State and duly authorised in writing in that behalf by the Minister for Lands and Agriculture may at any time inspect and take copies of any such register or any part thereof; and
(e) an officer employed in a Circuit Court Office and performing duties formerly performed by the under-sheriff may at any time inspect the register of chattel mortgages maintained in such Circuit Court Office; and
(f) whenever the Supreme Court or any Judge of the High Court or the Circuit Court directs that a copy of the portion of any such register relating to any particular chattel mortgage or alleged chattel mortgage be furnished to them or him, such copy shall be so furnished accordingly and such Court or Judge may disclose or publish such copy or the contents thereof to such extent and in such manner and subject to such conditions as in their or his opinion justice may require.
(7) The High Court or the Circuit Court or the Supreme Court on appeal from the High Court may at any time cause any register of chattel mortgages maintained under this section to be rectified (whether by variation, addition, or omission) in such manner as justice may require.
(8) The Minister for Justice may by order make regulations in relation to all or any of the following matters, that is to say:—
(a) the form and contents of the several registers of chattel mortgages maintained under this section;
(b) the keeping and maintenance generally of such registers;
(c) the mode of registering a chattel mortgage in such registers and the evidence to be produced for the purpose of such registration of the due execution and stamping of such chattel mortgage;
(d) with the consent of the Minister for Finance the fees to be charged and taken in respect of the registration of chattel mortgages in such registers, the removal of chattel mortgages from such registers, the inspection of such registers and any other matter relating to such registers;
(e) the general preservation of the secrecy of such registers and in particular the evidence of authority to be produced by persons claiming to inspect or take copies of such registers;
(f) after consultation with the Minister for Finance, the persons who are to be deemed to be recognised banks for the purpose of the provisions of this section relating to the inspection and taking copies of such registers.
(9) The expenses of carrying this section into effect shall, to such extent as shall be sanctioned by the Minister for Finance, be paid out of moneys to be provided by the Oireachtas."
This amendment brings us to Section 20, and the point raised on the last day.
I want to speak on Section 18.
We are not proceeding by sections but by way of amendments.
Can I not speak on the section?
Not until the general question arises.
Could I ask for an explanation?
Only on the main question.
I have considered the matter referred to in this amendment since it was raised on the last occasion, and, as a result of that consideration, I have reverted to the original amendment. Deputies will remember that on the last day the objection to the amendment which I inserted on the Order Paper was that it interfered too much with the secrecy of the register. The amendment, so far as it was changed at all, was not a very big change. The Bill provides for one central register, and the amendment provides for one register in each county. It was felt that that interfered with the secrecy of the register to some extent. It was admitted that it was necessary to get over the difficulty, and it was agreed that it was necessary to save the sheriff against an action for illegal seizure. It was because of that that I put down an amendment in Committee providing for a register in each county so that the sheriff could inspect it immediately before making a seizure. I have since considered the point and have come definitely to the conclusion that a register in each county is not going to interfere with secrecy to any extent.
Compare the procedure in the case of a seizure on a chattel mortgage with the present procedure. A farmer wants a loan, and as he is not prepared to offer a mortgage on the lands he must look for two or three sureties. There is not much secrecy about that. It is much harder for a man to go to two or three of his neighbours to act as sureties than to run the risk of having a loan inserted on the county register, which is secret, inasmuch as the information can only be known to a few persons and the loan cannot be entered in such gazettes as "Stubbs." A man who goes to his neighbours to back a bill will much more readily take a loan, even though it may be entered on the county register. That is not the strongest point. All mortgages on registered land are now registered in the local register, and anyone, on paying a fee of a shilling, can get full information about such mortgage. Anybody can go into the local registration of title office in any county and, on payment of a shilling, can inspect the register. That has not interfered with mortgages on lands. I think the registering of a chattel mortgage in the local office will not unduly interfere with that secrecy which is considered desirable. I base that on the analogy of mortgages on land and also on the fact that at present, when a farmer wants a loan, he has to go to two or three of his neighbours to back a bill. A man who will do that will prefer to go to the local office.
I oppose this amendment for the same reason as I opposed it on the last occasion. If the Minister thinks his point of view is sound I feel that my point of view is even sounder now than it was on the last day. I am not prepared to accept the Minister's interpretation of the result of a mortgage entered in the county registry office being a sufficient indication that people will avail of the chattel mortgage system without hesitation. The number of people who will avail of this system of chattel mortgage will, I hope, be very small, or at least, I hope that the number of people whom the sheriff will have to look after by having to make a seizure will be very small compared with the total number who will borrow money. The Minister is trying to make provision so that the sheriff will be safeguarded by having all possible information in 100 per cent. of the cases, whereas it is hoped that the sheriff will only require information in about 5, or, at most, 10 per cent. of the cases in which money will be borrowed under this method. I am absolutely convinced that this method of having a register in each county town is going to make a big difference. Suppose, for instance, Deputy Heffernan wants to avail of this method of obtaining a loan and I want to avail of it also, I cannot see any justification—if someone proceeds against me at a later stage for debts— for the sheriff requiring information against Deputy Heffernan and everyone else who will stand up to their liabilities on this matter. I am satisfied that that will prevent many people availing of this system. Even when they do, it will be with great reluctance indeed. On the other hand, what is the alternative? Deputy Heffernan has put up an amendment that I think will meet the case.
What amendment does the Deputy refer to?
Amendment 12 (a), on the white paper, which makes provision for the under-sheriff to obtain information from the High Court. The Minister is going on the assumption that many of the people who are going to borrow money under this scheme are going to be taken into court for other debts. I hope that will not be the case. I think it would not be satisfactory that the administration of the Act would be such that it would make provision for giving loans to quite a large number of people who would have to be taken into court for other debts. I would prefer that the Minister would make provision that it would be difficult for people who would act like that— people who are not prepared to honour their just debts and who have to be taken into court—to receive assistance. The Minister should not act on the assumption that the bulk of the people who will require loans will be of that type. They will be rather the other way. Perhaps 2 per cent. of them will have to be taken into court. I urge strongly on the Minister that it will be much more satisfactory if the central register is kept. Further, I believe he will have a better type of borrower. As I pointed out on the last day, this work will be done in the offices of the county registrar by subordinates, and I see great difficulty in maintaining secrecy. Anyhow, whether secrecy will be maintained or not the Minister may accept it that hundreds of people will believe that secrecy will not be maintained. People will have recourse to the office of the county registrar and no matter how you may protest to the contrary the feeling will be that secrecy will not be maintained. I urge strongly on the Minister to leave the section as it is.
I am as much for secrecy in this matter as anybody but I think Deputy Heffernan's amendment makes it too tight. As far as I can read it, he would limit the giving of information to the sub-sheriff and nobody else. Is that so?
I think not.
I draw that conclusion, that the sub-sheriff is the only person who may get information at all.
I suggest that the Deputy ought to read the amendment.
Deputy Heffernan's amendment is:—
In page 9, Section 20, to add at the end of sub-section (6) a new paragraph as follows:—
"An under-sheriff may, at any time, inspect the register of chattel mortgages maintained in the central office of the High Court either in person or by duly appointed deputy, or may demand to be supplied by registered post with a certified abstract of any portion of the register."
We can discuss Deputy Heffernan's amendment with amendment 12 of the Minister, and put amendment 12, because if Section 20 is deleted, and a new section inserted, Deputy Heffernan's amendment would not arise. The proposal contained in Deputy Heffernan's amendment may be discussed. That is the position.
It is a very difficult matter to draw a tight line. You do not want information given to people who have no business to get it, except for purposes of their own curiosity. But people like the under-sheriff and the banks who are concerned with the money part of the scheme have certainly a right to have the information. I think the Minister has fairly well defined in this amendment the class of person who can get the information. As regards the High Court, it would be more inconvenient for people in the country who want information than the Circuit Court.
I think Deputy Wolfe, in his desire to support the Minister, did not read the amendment very carefully. In the Committee Stage of this Bill the Minister, after considerable discussion, accepted the idea that the register should be a register kept in the central offices of the High Court.
I did not.
The Bill that came from Committee contains the original section. The Minister withdrew his amendment. Then he comes along, at this stage, with the same amendment again. So the Minister does not seem to be able to make up his own mind. Taken in conjunction with my amendment, the Bill, as it stands, I think, is quite workable, because the only change in the original form would be to give the sub-sheriff an opportunity of getting the information that he wants. That change is proposed altogether for that purpose. Not only will the Minister's proposal involve the risk of violation of secrecy but it will involve a considerable amount of extra expense. He will now have to have a register in every Circuit Court area. That possibly will mean a man in charge, or it will take up part of the time of an official and will mean additional expense. My view about the question of secrecy is that if we decide we must have secrecy we ought to have it as far as we possibly can. Personally, I do not approve of secrecy, but the Minister has decided that it is the view of the people of the country that this would not be workable unless you have secrecy. Therefore, if we are to have secrecy let us have real secrecy. You will not have real secrecy if this register is kept in the Circuit Court offices. Even if you do have something corresponding to genuine secrecy you will have people believing that there is not secrecy.
Then they can do without the money.
They will have to do without the money. That is so. But we want to make the money available for them. I suggest the Minister ought to let the section stand and add my amendment (12a), because it will allow the under-sheriff to get any information that would be necessary for him. The only delay will be the delay in the post. He can get any information he wants in three days. I am not sure that there will be very many cases where the sub-sheriff will have to make seizures where he cannot allow three days to elapse before making the seizure. The class of people who will be affected by this chattel mortgage will not be the "bad hats" of the country, so to speak. They will be carefully looked into before advances are made in the first place. They will be people of reasonably good reputation, and the cases where the sheriff will have to make seizures will be very few.
I am absolutely satisfied that this will not impair the secrecy of the register, for practical purposes. In every county there is a register of mortgages of land. Does that prevent anyone giving a mortgage on land? I live in the country and I never heard yet of anybody refusing to give a mortgage upon his land because it had to be registered in the local office, and the local register is not nearly as secret as this, because anybody who pays a shilling may inspect it.
Why have any secrecy at all?
He cannot answer that.
I give it up.
Does not the Minister understand that the number of people who have mortgages on their land is very small compared with the number of people who will be borrowing under this system.
Why does the Deputy make an interruption like that? I have stated that view, but they are not deterred from giving mortgages on their lands because of the fact that they are registered in the local register.
That is one of the causes. It is a factor.
Indeed it is not. The practical farmer has a strong objection to giving a mortgage on his land, but it is never because of registration. He does not know anything about it, principally because the register is inviolate; it is never revealed. He leaves it to his solicitor. If there were any abuses he would hear it and he never makes an objection on that score. I am quite satisfied that this makes no practical difference to the secrecy, and anyone who is so meticulous on the matter had better go and get money elsewhere.
Amendment put and declared carried, Deputies Heffernan, Conlan and Baxter dissenting.
I move amendment 13:—
In page 11, line 13, section 22 (1) to delete all after the word "interest" to the end of the sub-section.
Deputy Heffernan will remember that he got a clause in a previous section, dealing with the insurance of stock subject to a chattel mortgage, eliminated. As we have taken out a similar clause from a previous section, we are taking this one out here.
I move amendment 14:—
In page 11, lines 47 and 48, Section 23 (1), to delete the words "in the register of chattel mortgages set up" and substitute therefor the words "or first registered (as the case may be)."
The amendment provides that mortgages shall have priority in accordance with the date of their first registration. Deputies are aware that mortgages may now be registered in two counties. This happens, say, in the case of a man who has lands on the borderline of two counties.
I move amendment 15:—
In pages 11 and 12, to delete Section 24 and substitute therefor a new section as follows:—
(1) A chattel mortgage shall not prevent or restrict the lawful seizure of any farming stock comprised therein or affected thereby by a landlord distraining for rent or a duly authorised officer distraining or levying under the Income Tax Acts or a rate collector distraining for rates or the lawful seizure and sale of any such farming stock under an execution order issued for the enforcement of a judgment or order for the payment of moneys due or payable to or for the benefit of the Central Fund or the repayment of advances made out of moneys provided by the Oireachtas or the interest on such advances or of moneys due or payable to the Irish Land Commission under the Land Purchase Acts or to a rate collector in respect of rates levied by the council of a county, a county or other borough, or an urban district or the commissioners of a town, or to a landlord in respect of rent.
(2) Save as is provided in the foregoing sub-section no farming stock comprised in or affected by a chattel mortgage shall be seized or sold under an execution order, unless before such seizure the creditor has paid to the under-sheriff or county registrar executing such execution order the full amount of the principal moneys and interest then owing and unpaid on the security of such chattel mortgage.
(3) Whenever a creditor pays under the foregoing sub-section to an under-sheriff or county registrar the full amount owing on the security of a chattel mortgage, the following provisions shall have effect, that is to say:—
(a) the under-sheriff or county registrar shall pay such amount to the mortgagee and the mortgagee shall accept such amount in discharge of the moneys secured by such chattel mortgage notwithstanding anything to the contrary contained in such chattel mortgage and in particular notwithstanding that such moneys are not then due or payable, and
(b) the said amount shall be added to the debt for which execution is leviable under the execution order, and such execution order shall have effect accordingly.
(4) For the purpose of enabling the creditor to take advantage of the provisions of sub-sections (2) and (3) of this section, the following provisions shall have effect, that is to says:—
(a) whenever a creditor requires an execution order to be executed against any farming stock the under-sheriff or county registrar shall inspect the appropriate register of chattel mortgages and if on such inspection such farming stock is found to be comprised in or affected by a chattel mortgage such under-sheriff or county registrar shall inform the creditor of the existence of such chattel mortgage the date thereof and the name and address of the mortgagee, and
(b) the mortgagee shall on demand made by the creditor furnish to the creditor a statement of the full amount of the principal moneys and interest then owing and unpaid on the security of the chattel mortgage.
(5) In this section the expression "execution order" has the same meaning as it has in the Enforcement of Court Orders Act, 1926 (No. 18 of 1926) and the word "creditor" means the person at whose instance an execution order is issued.
This amendment provides for the following sort of case. A man, say, mortgages his stock for £100 to the bank. He pays off £95 and leaves £5 due on the stock, and the chattel mortgage protects the stock as well as the subsequent stock—it may be a floating chattel mortgage—from any other creditor. That would be an undesirable position to have. The only way of meeting it is the way set out in this new section, which provides that where a judgement creditor lodges a decree and the sheriff informs him that he cannot seize because there is a chattel mortgage on the assets, it is open to the creditor to apply to the Corporation and get the amount of the mortgage outstanding. He can pay that into the Corporation, and then seize for his own debt, plus the amount that he has paid.
There is just one question that I want to ask on Section 18. The penalty specified is penal servitude for three years. There is no option but to impose penal servitude. I want to know if that is the maximum penalty?
The section says that a person guilty of a misdemeanour shall be liable, on conviction, to penal servitude for three years or imprisonment for any term not exceeding two years. Two years' imprisonment is the maximum that can be imposed. Anything over that would be penal servitude.
Under the section could a man be given penal servitude for 2½ years or 2 years and a month?
The judge has a good many options. He could sentence a man to a month's imprisonment or to two years' imprisonment, but I have never heard of anyone being sentenced to 2½ years' imprisonment.