All the amendments dealing with this are being taken together. The question put will be "That the word `forty' stand."
Supplementary Estimate. - Town Tenants Bill, 1930—Committee (Resumed).
Debate resumed on amendment 43:—
In sub-section (1) (b), line 61, to delete the word "forty" and substitute the word "five."—(Deputy Lemass.)
It is so long since the matter was discussed, perhaps it would be no harm if I restated the case for the amendment. In my opinion this is the most important amendment to the Bill. The provision in the Bill is that a tenant must have forty years' continuous occupation of a tenement in order to become entitled to fixity of tenure. The amendment is designed to reduce that period of forty years to five years. It is not the purpose of the amendment to provide that a person who has five years' occupation should be protected for all time against ejectment. Its aim is to ensure that a tenant who has been in occupation for five years cannot be ejected without cause. Under any circumstances a tenant who fails to pay the rent, breaks any condition in the contract of the tenancy, or against whom the landlord can advance good and sufficient cause, can be ejected. Similarly a tenant can be denied renewal of a tenancy if the landlord requires possession for rebuilding or reconstruction, for the purpose of carrying out a scheme for developing the property, or for any reason consistent with good estate management. It is quite obvious, therefore, that the interest of the landlord is sufficiently protected by the Bill to make it unnecessary to add this additional safeguard that the tenant must have been forty years in occupation in order to become entitled to security of tenure. It is apparently the view of the Minister for Justice that a person who has been in occupation of a dwelling for thirty years, who has during all that period been a good tenant, who has regularly paid the rent, who has kept all the conditions of his contract, and who has given no reason whatever which would justify the landlord in seeking his ejectment should, nevertheless, be liable to ejectment without cause at the whim of the landlord, irrespective of what hardship that ejectment might cause the tenant.
I find it very difficult to understand why there should be any limit in time at all in this part of the Bill. I think common justice would suggest that where a landlord accepts a tenant, that tenant should be allowed to remain in possession of the dwelling, so long as the conditions of the contract are being observed, so long as the rent has been paid, and, in the words of the Bill, no good or sufficient reasons are given for the termination of the tenancy, unless, as is provided in Section 20, the landlord requires to resume possession for any of the reasons there stated. It may be contended that a reduction of this period of time would constitute a hardship for landlords. It is very difficult to see how it could. The landlord is only bound by it so long as the tenant is paying him the rent which he has asked for the dwelling, and is keeping the conditions which he imposed in the contract. At any time, when the yearly or other tenancy expires, the landlord can increase the rent if he is satisfied that such increase is justified in all the circumstances of the case, including competition for dwellings in the neighbourhood. In other words, the landlord has secured for that dwelling a tenant who will regularly pay the highest rent he can expect to get in the open market. He cannot be said, therefore, to suffer any hardship. Nevertheless, it is apparently the contention of the Government that the landlord should, in addition, have power, for no reason whatever, to eject that tenant, even though he has been there the greater part of his life —thirty or thirty-five years.
No doubt the Minister will argue that this term of forty years was suggested by the Town Tenants Commission. It is undoubtedly true that the Town Tenants Commission suggested a period of forty years in this case, but the Commission also suggested a number of other things. It is not fair for the Minister for Justice to pick out a recommendation of that kind here and there, put them into the Bill, and, at the same time, reject other recommendations that relate to them. The Town Tenants Commission also recommended the enactment of legislation which would enable occupying tenants to go to court to get a fair rent fixed. If the Minister had accepted that recommendation this particular section of the Bill would not be nearly as important as it is.
What recommendation is the Deputy referring to?
The recommendation of the Town Tenants Commission contained in paragraphs 27, 28, 29, 30 and 31 dealing with excessive rents of occupying tenants. If the Minister had accepted these recommendations, and if he had made provision in this Bill by which occupying tenants could go to court to get a fair rent fixed, if they believed that they were paying exorbitant rents, the period of time mentioned in this part of the Bill would not be so important. It is because the Minister has rejected these recommendations that the period of forty years for which a tenant must have been in occupation before he can get a fair rent, becomes wholly unacceptable. It is difficult to foresee what case the Minister can make for the proposal in the Bill. Its only aim can be to enable the landlord to evict good tenants without cause, or else to make it possible for the landlord to extract from the tenants exorbitant rents, the highest rent he could possibly hope to obtain under Section 27 of the Bill. That is the only reason why that term should be there. If it is the aim of the Minister to do justice in this case, to deal equitably with both landlord and tenant, I would suggest that not even a period of five years should be mentioned. No period should be mentioned. If the tenant observes all the conditions specified under Sections 19 and 20, pays the rent fixed, in default of agreement by the court, on the basis of free competition and vacant possession, he should be allowed to remain in possession. That is the argument I am advancing. I hope the House will see the justice of it, and will not tolerate for one moment the fantastic proposal which the Minister is making. The section with which we are dealing is the most important part of the Bill and, if it goes through in its present form, whatever little advantage the Bill confers on town tenants will be destroyed.
Mr. Byrne
I should like to support an amendment, but not the one moved by Deputy Lemass. There are three different amendments incorporating different periods of time. I think Deputy Lemass in his amendment suggests five years, another suggests ten years, and another twenty years. It has always been the fundamental claim of town tenants that they should enjoy two things, fair rent and fixity of tenure. That has been the claim that town tenants have made in all the agitation that has been carried on for the introduction of this Bill. The amendment moved by Deputy Lemass seems to go too far. He wants to give ordinary people residing in houses certain privileges that we, on behalf of business tenants, have never sought.
Deputy Lemass must be aware that there is a fundamental difference between a business tenant and a tenant living in an ordinary house. In the case of a business tenant, fifty per cent. and probably more of the increased value of the premises is due to the invested capital of the tenant and due to his energy and enterprise. In the case of the ordinary tenant who lives in a house and pays his rental he enjoys undisturbed possession, but he does nothing whatever good, bad or indifferent, to add to the value of that particular house. It cannot be contended in this House on an equitable basis that the ordinary tenant residing in a residential dwelling can possibly be put on the same basis as the man who has built up a business and good-will in an ordinary business house.
I am in agreement with the principle underlying the amendment moved by Deputy Lemass. I ask the Minister to consider favourably the reduction of the figure of 40 years, which is the period stated in the original section of the Bill. A period of 40 years before a tenant in occupation enjoys any privileges under this Bill seems, to my mind, a most inequitable period of time. I suggest that the Minister could go some distance to give the ordinary residential tenant at least equity and fair play under this section of the Bill. Take the tenant who has been in occupation of a house for 25 years. Surely that tenant is entitled to enjoy a fair rent and enjoy fixity of tenure.
I came across a case only a fortnight ago where the tenant had been in occupation of a certain holding for a period of 29 years. It came to the ears of the landlord that he had living with him his married daughter, her husband and one child. The landlord immediately endeavoured to eject the tenant. He served a notice to quit upon that tenant who had been in occupation of the house for 29 years. Will anybody in this Assembly pretend for a moment that a tenant in occupation of a residence for 29 years is not what anybody would call a good tenant?
Surely there is a difference between a good tenant and a bad tenant. A landlord gets in bad tenants, and I know that landlords suffer great financial hardship from bad tenants. Bad tenants come and go like the waves of the sea. All they want is to get possession of the landlord's house, and they endeavour to stick him for as much rent as possible. Such a tenant is in a very different category to a tenant in occupation of an ordinary house for 25 years or 29 years. When a tenant is in occupation of a house for a quarter of a century, and has paid his rent regularly and given his landlord no trouble, that tenant is entitled to some consideration. To fix the period of 40 years, as is fixed in this Bill, does not, in my opinion, give the tenant the consideration to which he is entitled.
[Professor Thrift took the Chair.]
I totally disagree with the amendment moved by Deputy Lemass, but I would suggest to the Minister that he would come some way to meet us and fix a period of a quarter of a century occupation, so that the tenant in occupation for 25 years should be entitled to enjoy fixity of tenure and a fair rent. That would be an equitable provision that would work no injustice either to the landlord on the one side or to the tenant on the other side. It will be quite evident that in asking the Minister to give the tenant who is 25 years in occupation the right to enjoy a lease under this Bill, we are not asking for anything unreasonable or anything that is unjust. If anybody who has read the Bill considers the terms upon which that fixity of tenure and upon which the fair rent can be granted, he must come to the conclusion that no injustice can possibly be done to either side by making the period 25 years.
I would remind the Minister in considering this section the court has full and ample powers (1) to fix the annual rent that would be payable by the tenant if he obtains this new lease; (2) the court has also powers to order the expenditure of certain capital sums of money either by way of permanent improvement or otherwise, and (3) the court has power, and most important power, to increase, if necessary, the annual rental payable under the new lease that the tenant would secure. Is there anything unreasonable in that? Will any man, any owner of property, contend that a tenant 25 years in occupation of a house who has been a good tenant and who has given his landlord no trouble, a man who has performed all his obligations as a tenant during 25 years' tenancy, contend that it is unreasonable for that tenant to come here and say: "I have now been 25 years in occupation of this house, and I am entitled to fixity of tenure and to a fair rent"?
In the case of the tenant that I quoted to the House a few minutes ago, who had been 29 years in occupation, I might inform the House that that tenant had still got his week's rent paid in advance after all that time. There must be a limit to the rights of property. We hear a great deal about the rights of property, but we never hear a word about the duties of property. There is a famous dictum that property has its duties as well as its rights. I say here that hitherto the rights of the landlord have been sacrosanct, and the rights of the tenant non-existent. Under this section of the Bill we ask the Minister to come some way to meet us. I suggest that it is only equitable and right that the tenant who has been 25 years in occupation is entitled to enjoy that fixity of tenure, and entitled to enjoy a fair rent.
We do not suggest that the landlord is not entitled to a reasonable return on his capital. No man will deny that when capital is invested there should be a reasonable return. But the investments of the landlords hitherto have been much more like the investments of the Jews, demanding their pound of flesh without any regard to humanity, or the ordinary rights of the citizen. Let us assume for a moment that this tenant who is 29 years in occupation of the house has paid his rent for all those years. How many times over has the landlord been paid the capital sum for which he purchased that house? Yet, that tenant does not own a slate or a brick in that house. And then the landlord can come forward and say "because your married daughter is living here with her husband as part and parcel of your family, I will serve notice on you, ejecting you on the street." There must be a limit to the rights of property, and some recognition of the rights of tenants. Under the existing law, the rights of the landlord are observed, and fully developed, but the rights of the tenants are non-existent. When a tenant has been in occupation for a period of a quarter of a century, the landlord should be very anxious not to eject him, but to retain him. Nobody will suggest that such a tenant is not a good tenant. It is a common cry of the owners of property: "We are anxious to encourage good tenants." If that cry be true, if they be sincere in making that statement, it is up to this House to say that some rights be given to the tenant under this Bill, and that a tenant who has been in occupation for an unbroken period of a quarter of a century should expect equitable and fair treatment.
To offer a tenant no rights in an ordinary house for an unbroken period of forty years seems to be a most inequitable proceeding. Deputy Lemass's amendment is quite impossible. There is no Deputy here who would, for one moment, agree that a tenant five years in occupation is entitled to get a vested right from the landlord.
I think Deputy Byrne does not understand the section at all. He is assuming that it is to apply to the one tenant in occupation. It really refers to the tenant or his predecessors in title.
Mr. Byrne
If it applies to the tenant or his predecessors in title, that only makes the case worse. If the tenant, or his predecessors in title, are in occupation only for five years, does not that make the amendment more inequitable still? When arguing the rights of town tenants in this country I have found a great number of the tenants themselves unreasonable. I have always found that that unreasonableness acts as a great bar to the tenants obtaining their legitimate rights. I do not think that Deputy Lemass was well advised when he was encouraged to put down this amendment. I do not think that any Minister who is anxious to hold the balance evenly between the conflicting rights of landlord and tenant could possibly accept the Deputy's amendment. I hope the Minister will favourable consider reducing the period of forty years to a period of twenty-five years. I suggest there is nothing unreasonable in that. The tenant, under the terms of the Bill, can only get a lease upon what the court decides are fair terms. The tenant will only get fixity of tenure on fair terms and at a fair rent. When I use the term fair rent I use it equally in the interests of the tenant and the landlord. I earnestly appeal to the Minister to reduce the period of years to twenty-five.
As regards fixity of tenure, I am, perhaps, to a great extent, in substantial agreement with Deputy Byrne. I will ask Deputy Byrne to bear in mind that his suggestion, if adopted by the Minister, would require a good deal of qualification, or great injury and injustice would be done to people who own only one house. The Deputy may make all the gestures he wishes, but his suggestion might end in the way I have indicated. The owner of the single house, if he happens to be a poor person, is politically contemptible and politically negligible and very few will cater for him in this House. There are Deputies here who ought to have some sense of justice. I am sure they will have a sufficient sense of justice, no matter on what benches they sit, not to confiscate the property of the poor people.
I have in mind the case of a widow who bought a house some ten or twelve years ago with the object of future occupation by herself. That was a very legitimate purpose. She let the house temporarily, and it then came under the Rent Restrictions Act. That Act prevented her from either occupying the house or selling it in the open market. It is all very well to say that the owner of a house can sell it, but what is that owner really selling? If you are not in a position to give possession of the house immediately on sale you will not get a price for it. I know that that is the fact, and I may as well tell that to the House now. This unfortunate woman to whom I have referred is a dispensary doctor's widow. She has six or seven orphans to look after, and she has to try to keep herself and the children on between £70 and £80 a year. Now the suggestion is made that her house should be confiscated. The amount of money she paid for the house was £1,200 and portion of it was borrowed in the bank. The bank pressed for payment. She wanted to sell the house but could not do so. The occupying tenant, a wealthy man who had as many thousands as she had pounds, said to her that he would waive his rights under the Rent Restrictions Act if she gave him £300.
Surely Deputy Hennessy is speaking on amendment 50?
Acting-Chairman
We have not got to amendment 50 yet. The Deputy's argument may be relative.
I merely want to mention that great injustice may be done to people who own single houses, or even two houses. I have an amendment on the paper for consideration later on. If that amendment were adopted it would relieve this injustice. However, there is no offer in that direction. I do not imagine that any landlord who has nine, ten or twelve houses to let will want to be disturbed. I do not suppose he would be anxious to get rid of a good tenant. I think, however, that it is most unfair in the case of a person who owns one house. I know, also, the case of a retired school teacher who bought a house with the idea of occupying it ultimately. He is now living in a garage, and the tenant of his house is a well-to-do man. This retired school teacher cannot provide alternative accommodation. The scarcity of houses is really a thing of the past because of all the new houses that have been built with Government grants.
The Deputy must be living in the past.
If the Minister is going to adopt any of the suggestions that have been made, he should make an effort to exempt the class of person to whom I have referred. I have no objection to fixity of tenure, but I have a great objection, and I make no apology whatever, to the property of any poor person who may happen to own a house, being confiscated.
Mr. Byrne
The case that Deputy Hennessy has quoted will not bear examination. If the statements made by Deputy Hennessy are true, that the landlord was living in a garage while the tenant was occupying his good house, and that the house was covered by the Rent Restrictions Act, the Minister knows quite well that the question of greater hardship would at once arise under the Rent Restrictions Act, and the landlord would be entitled to get clear possession.
If he has a long purse.
Mr. Byrne
The one thing underlying the whole argument is that the landlord wants to get possession of the house for one reason only, and that is to sell the premises so that he may get the abnormal price which he undoubtedly would be able to get under existing conditions. There is not the slightest doubt, if the facts that Deputy Hennessy stated to the House were true, that that landlord, instead of living in a garage, if he consulted any solicitor in this State, would be enjoying possession of his house to-day.
What about the other case I mentioned?
I suggest this is altogether out of order.
Acting-Chairman
Let us come back to the Bill.
Mr. Byrne
I will not say any more except that we are tired of Deputy Dr. Hennessy and this Bill.
I rise to oppose this amendment. We are all aware of the great scarcity of houses which exists at the moment. We all know, how difficult it is for a person looking for a house to be accepted as a tenant. There is some reason for that, and the reason is simply this, that owing to recent legislation owners of house property do not feel secure that they have a genuine claim to their property. If this amendment of five years is accepted, or even an amendment of 25 years, what would be the effect on house-owners? The effect would be that when one of their houses became vacant they would not let it to any tenant, and justly so, because after five years that tenant would have a claim to that house. Let us be reasonable about this matter and approach it from a business point of view. The man who built the house invested his money because he thought it was a safe investment and thought that his money was secure for all time. When he let a tenant into the house he thought that he was not giving away any right to his property and that the tenant was prepared to pay his rent, year by year, provided that the landlord observed his end of the agreement. Those agreements are usually that the landlord keeps the outside weather-proof and the tenant keeps the inside, as a rule, in repair. I would say that no matter what length of time the tenant lives in a house he should not have a claim to it other than under the agreement with his landlord. Is there any such proviso in the case of anything else which he invests?
Mr. Byrne
Railway Stock.
Let a man put his money in other investments. After ten or twelve years he is paid in full. Here it is thought that because a tenant lives in a house for 25 years he has bought the house. I do not think that is a fair argument at all. The tenant gets good value for his money per his agreement, and when he took the house I do not think he had at the back of his mind the thought that he would become part owner after a certain number of years. If this kind of legislation goes on, it will be almost impossible for anyone looking for a house to be accepted as a tenant. Those who are pleading the case for tenants are doing a bad day's work for them, because when a house will become vacant no landlord will let the house. He will try to sell it.
Mr. Byrne
Let him sell it.
I did not interrupt the Deputy, who has made two speeches already, and I ask the protection of the Chair against those interruptions. This is going to be detrimental to the people the Deputies are speaking for. There is a great objection to landlords who will not let houses; people who want houses come to me, asking me to use influence to get houses let.
That is before the Bill is passed.
If legislation of this kind is passed, it will be impossible for people who are looking for houses to be accepted as tenants. Therefore let those who are pleading for the tenants be very careful or they will put them out of action completely. In the old days house property was looked upon as a very safe investment. To-day that is not so. A few years ago, in this House, a Town Tenants Bill was introduced, under which, in the case of a tenant living in a house for fifteen years, the landlord could not sell without giving him an interest of fifteen years' purchase as well. That would be almost half the value of the house. This kind of legislation is bad, because after all, we must be reasonable and sensible in this House, and see that we do not take anything which belongs to another. A great many in this country are anxious to get something for nothing. They would stay up all night trying to get something for nothing, instead of working to get it fairly and squarely. It is most unfair to take rights from those who invest money in house property, or build houses. Therefore, I am completely opposed to this amendment of five years or twenty-five years. I say the thing should be left as it is, because there will be always a fairly good feeling between tenants and landlords. We hear of one bad landlord here and there. There are bad tenants too. I think the things is all right as it is, and the less legislation dealing with house property which is introduced here the better for the tenants themselves.
Deputy O'Connor has made a speech which, without offence to him, comes rather late in the day, because the principle of giving a renewal of a tenancy has, I think, been accepted by this House and by public opinion in this country. Deputy O'Connor and, I think, Deputy Hennessy, rather tried to lead this House to believe that this amendment is entirely in the interests of the tenant and is inspired purely by greed and selfishness. Of course, it is right to say that the amendment is conceived primarily in the interests of the tenant. There is no doubt about that, but it is more far-reaching than that. I think that on reflection the House can see that the amendment, either in the exact form in which it stands or with such slight modification as may commend itself to the House, is in the interests of landlords or tenants. Is any Deputy in this House, even Deputy Dr. Hennessy, or Deputy O'Connor, optimistic enough to believe that if the Bill, as introduced now, is passed with a forty years' period that there will not be considerable agitation in the country? Does Deputy Dr. Hennessy believe for a moment that if this Bill is allowed to pass unamended it will be calmly accepted by the people of this country?
It will be accepted by all honest people.
The House is not sure of the honesty of any person in this country except possibly the honesty of Deputy Dr. Hennessy. But taking the facts as we find them in the world where there are all sorts of honest men like Deputy Dr. Hennessy, perhaps slightly dishonest people like myself, what I ask the House calmly to consider is this: do they believe that this Bill, if it is pressed through this House with the enactment of the clause as it stands in the Bill, that there must be forty years in order to require the right of renewal in certain instances, will be accepted by the organisations of tenants in this country? Of course it will not. There will be a state of uncertainty, and that state of uncertainty is detrimental to builders who build houses, who, if things seems settled for a period, will proceed with their enterprises and will build. They can calculate their costs and know where they stand if the law in the country, with regard to landlord and tenant, is substantially in accord with the public opinion of the country.
If it is out of harmony with public opinion you will have that agitation to which I have referred, and you will have a grave feeling of uncertainty which will be detrimental to householders who have occasion to let houses. It will be detrimental to them in various ways. They do not know exactly how they stand in regard to their tenants. They do not know exactly how they stand as regards the saleable value of their interests. They do not know how they stand as regards the value of their property, if they want a mortgage on it or to pledge it to a bank. Reduce this period to five or ten years or some period that will commend itself to the general sentiment of the country, and you remove all that. In that way you improve the position of what I will call, without offence, the speculative builder and you improve the position of the owner of a house who wants to let his house.
I ask the House to believe that it is a narrow view of this amendment to represent it as selfish or to harp too much on words like honesty, greed and so on. Surely the interests of the country would be better served if an amendment like this were dealt with by the use of language somewhat more restrained and somewhat calmer than that. I think the Minister said when he was introducing this Bill that he did not think the Bill was the last word as regards the relation of landlord and tenant generally. That may not be a fair paraphrase of what the Minister said. I thought the Minister said something to the effect that he did not think that this Bill completely dealt with the matter. Be that as it may, there is no reason, at all events, why this section of the Bill, if dealt with now without passion in the House, might not for many a year represent a code upon which a tenant complying with the statutory conditions would be entitled to a renewal of his tenancy. If this House were to wed itself to a period of forty years, or even a period of twenty-five years, which was suggested by Deputy Byrne, you would have nothing approaching finality. I would appeal to the House to arrive at some period which will in that way be acceptable and which will serve the interests of both parties who are concerned in house property in the Irish Free State.
I think Deputy O'Connor must not have read this particular section, or if he did he must have read it with very prejudiced glasses. His whole speech dealt with confiscation. There is no suggestion of confiscation in this section. He spoke as if his property was going to be confiscated. Where is that suggestion in the amendment or in the section? What is he fighting for? What is he claiming? He is claiming the right to have a tenant who has paid his rent regularly and complied with all the conditions of his agreement at his mercy, whether it is at the end of twenty-five, thirty or thirty-five years, so that he can send him about his business just when he thinks he ought to do it, irrespective of the fact that the rent has been paid regularly all these years, and that there is no suggestion that the man is a bad tenant. If he refuses to comply with the terms of his agreement there is no suggestion that he should have any rights under this section or the amendment. Then what is the meaning of this talk about confiscation that Deputy O'Connor has indulged in? What does he want more than a fair return for his money? He is getting that in the rent that will be fixed. Deputy O'Connor talked just in the language that was used forty years ago by landlords, and it was talk of that kind that caused a rebellion. He is not going to do any good to the cause of the people he apparently represents here by talking in that particular fashion.
Who are these people?
Mr. O'Connell
The landlords, evidently.
I represent the tenants and speak in their behalf.
Produce your credentials.
Mr. O'Connell
I am afraid the tenants will be the last to agree with the Deputy in that respect anyway. I suggest, as I mentioned before, that it would be contrary to our ideas of what living conditions are to be that a man, who has lived in a house for a great number of years, who reared his family there, and regarded the house not as a mere four walls to shelter him, but as a home with all the things that that word implies, should be at the end of a long period like that mentioned in the Bill, or at the end of twenty-five or thirty years, subject to be thrown on the roadside at the whim of the landlord.
Deputy Hennessy came along with a hard case. Of course the Minister will be the very first to say that hard cases make bad law. Even if there are such hard cases, Deputy Byrne, I think, has knocked the bottom out of these particular cases that Deputy Dr. Hennessy put up. Nobody has attempted to make a case for the fixing of a period of forty years. Deputy O'Connor attempted to make a case, but he talked about a thing, with all due respect to the Chair, that was entirely irrelevant because there is no suggestion of confiscation in this amendment. I press very strongly on the Minister to consider whether or not it is possible or right to maintain this period of forty years in the Bill, apart altogether from the recommendation of the Town Tenants Commission. It may not have been subject to examination at that Commission, but it has been subject to examination since. It seems to me that all the arguments are in favour of reducing that period very considerably indeed.
I would like to look at this question now not from the point of view of what you might call the human equities of it, the question of the right of a citizen to a home and so on, but purely from the point of view of a conservative-minded landlord. What does he want? It is always said that no tenant is better than a bad tenant, and I agree with that, but once a landlord has got a good tenant he wants to keep him. I think it is fair that the landlord should have an opportunity of getting to know whether he has got a good tenant, and the term in this section should be based upon that principle, from the point of view of the landlord. If the landlord can find out in a certain period of time whether he has got a good tenant or not that should be sufficient for him from the point of view of his security. I suggest that the landlord who attends to his property will know within a period of five years whether he has got a good tenant or not, whether he is satisfactory from the point of view of maintaining his security. There are two conditions from the point of view of the landlord. The house must be well built in order to make it a good security. When he is looking to buy house property he will try to get a place that is properly built. He will not buy a jerry-built house, and that is the chief reason why people are a little bit afraid of the modern builder. They are afraid of the way in which the concrete has been mixed in building the house.
He is afraid of investing money in property which is going to deteriorate very rapidly, but provided he has that security, that he knows the house is well built, the next thing he wants is a good tenant. Having satisfied himself within a period of five years that he has a good tenant in the house, that he has no other grievance, if his rent is subjected to revision by a court of law, I cannot see what objection he could have to that. After all, he wants a fair return for his money. Unlike Deputy O'Connor, he does not want to get all his money back in 10 or 12 years. He does not regard house property as a sort of sweepstake; he does not want a gamble; he is out for a moderate rate of interest and first-class security. I cannot see why a landlord should not be satisfied with sufficient security in the shape of five years learning what kind of tenant he has got. After that he could be very careful not to have to change his tenant. Even if he does have to limit his rent by some standard of justice fixed by a court, I must say that from the point of view of the community he has no real grievance.
The point I make is this: Deputy Little has taken me up wrongly. There is no landlord going to change a good tenant. If the tenant is paying his rent, he is undoubtedly kept on as a tenant. The agreements usually run from three to five years. At the end of five years, if the tenant feel that he has a bad landlord, he is free to get away from him. These agreements work both ways.
I am very much surprised at the extreme attitude taken up by Deputy Lemass in his opening speech, because he claimed that as soon as a tenant got into a house he had an equity to remain there for all time. He could not see why that should not be. I should like to call the attention of the House to a statement which occurred several times in the report of the Town Tenants Commission. I am reading from page 4, but you will get similar statements elsewhere. It is as follows:—
But even the least moderate advocates of tenants' rights hesitated to claim that mere occupation, for however short a period, gives a tenant a right to a renewal or a right to have the tenancy continued, after the stipulated period, at a fair rent to be fixed by some tribunal.
That proposition, which nobody on behalf of the tenants examined before this Commission thought could be sensibly put forward, is the very proposition which Deputy Lemass has put forward in his argument in support of his amendment. Therefore, it seems to me that Deputy Lemass has really not approached this amendment, or the whole consideration of the matter, from any real sense of endeavouring to do justice between two different classes of the community whose respective rights are very hard to reconcile. Deputy Lemass also said that while I was relying upon the forty years period I did not embody all the recommendations of the Commission. I have embodied them all except one, and that one is on page 25:—
Where the tenant is in bona fide occupation of the whole or a substantial portion of the holding and has been so for a period of not less than seven years, and it is proved to the satisfaction of the Court that there is a scarcity of accommodation in the locality in which the holding is situate and there does not appear to the Court to be a reasonable prospect of the tenant obtaining alternative accommodation.
That is a temporary thing. That is really dealt with by the Increase of Rent and Mortgage Act which is still in force. The whole of that is governed by the fact that the Commission thought that in June, 1929, the emergency provision would cease, because they mentioned so on page 24. Therefore, this period of 40 years is one of the recommendations of the Commission. The others are embodied in other sub-sections here.
Let us consider for a moment what this period of five years would mean— what would be the result. Suppose some builder sets to work, develops an area and builds a very large number of houses. He says to himself: "I cannot let these houses for a period longer than five years, because after that period for all practical purposes they will have sunk enormously in sale value." I agree with Deputy Dr. Hennessy that a landlord will get nearer the true value of his house if he can give vacant possession of it than he will if he has to sell, not the house itself, but merely a rent charge on the house, because that is what it comes to.
It has been stated here that landlords always want, in all circumstances, simply to get a fair return for their money. That is not so. Landlords very often have to realise their capital. It makes a tremendous difference. Supposing a man dies and his estate has to pay succession duty, or has to be divided amongst his children, or sold to pay his debts, or for any reason of that kind it is necessary to realise the capital. Very often a man wishes to realise his capital for the purpose of changing his investments. The capital value of a house most undoubtedly will have deteriorated if he has to sell, not the house itself but a mere right to a certain annuity out of the house, because that is what a fair rent amounts to. What would happen if we inserted this five-year period? I am pretty satisfied that what would happen would be that for every house for which there was a tenancy made there would be a letting made for four years, and at the end of the four years the tenant would have to put his furniture in storage possibly for about a week and the landlord would go into possession and there would be a new letting made for another four years. That is precisely what would happen, because you may be perfectly certain that landlords, seeing that there are circumstances in which it will be necessary for them to realise their capital and because they do not wish to put it out of their power to realise their capital in future, will make lettings that will defeat the purposes of this Bill if it were amended as Deputy Lemass and Deputy Morrissey has suggested that it should be amended. I think that is perfectly obvious.
Deputy Geoghegan talked about getting security and that if this happened that security would be given to builders and that it would add to building. I cannot follow that argument. If I build houses to rent, if I want to realise and get back my capital, I want to be able to sell them, even though I may at one period have let them to tenants. If I know that the moment I let to a tenant for five years I have either to go through the formula of recovering possession every four and a half years or else there will be an interest created against me possibly for 99 years in the premises, it is the greatest discouragement to me. I think it would almost kill building as an investment. We must be very careful about this. If we look at a problem of this nature only from one particular angle, it may for the time being benefit the tenant, but if we look at the matter from a wider and broader point of view, we may see that it will practically terminate the relationship of landlord and tenant, because I agree with Deputy O'Connor that there is that danger that people will not let a house if they find it is possible to sell it.
There are a great many people, young men, for instance, starting in business, and other persons of that kind, who are only able out of their annual earnings to pay rent. They have not got the capital sum to put down to buy a house and I think it is greatly to the advantage of the community that there should be a fair number of dwelling houses on the market for competition amongst persons not in the position to buy houses. Deputy O'Connell put forward no argument at all in favour of this four or five years' period or in favour of anything except a substantially long period. The reason why this forty years was introduced into the Town Tenants Report is obviously this: they were taken by the argument that Deputy O'Connell has put forward now —that a man may have been for a great number of years in a house, that his children may have been reared there, or that his father or his grandfather was there before him, and that the place has a sentimental association for him and that it is very hard in these circumstances to turn him out and put him into new surroundings after being a great number of years in one particular house.
Mr. O'Connell
Surely that would apply to less than forty years.
Then there comes the question as to what period of years. That was considered by the Town Tenants Commission and they came to the conclusion that the period should be forty years. It was their opinion that unless there had been continuous occupation for forty years really home association has not grown up. Forty years is their period, and I certanly think that that is the foundation upon which this rests entirely. It is simply a question of preventing people from being put out of their homes. It is a sentimental basis, if you like, not a basis that would occur to entirely business men. But we are not entirely business men. Everyone has a certain amount of sentiment in him and we must recognise that sentiment and human associations and things of that kind do play a very large part in human life and that they are matters we must take into consideration when dealing with things of that kind. But to say such association arises at the end of five or ten years, or even twenty years which is the longest suggestion, appears to me to be entirely wrong and I shall ask the House to reject the amendment.
It is quite clear from the Minister's speech why it is desired that a landlord should be in a position to eject without cause a tenant who consistently paid his rent over a very long period. The Minister talked about the selling value of the premises, and draws attention to the fact that that selling value is increased if the landlord is in the position to give vacant possession. It should be obvious that the selling value of a house when there is no scarcity is equivalent to the capitalised value of the rent. If there is no scarcity nobody will pay more for a house than would represent the fair investment of what he is going to get in rent out of the house. The selling value on the basis of vacant possession is increased in times of scarcity and the only purpose of the Minister's proposal in the Bill would be to enable a landlord to take advantage of the period of scarcity and to eject the occupier in order to get an enhanced price.
I do not accept the Deputy's facts at all.
The obvious conclusion of what the Minister was arguing is that if there is no scarcity of houses nobody is going to pay more for a house than what he will get out of that house in rent, and that a house will have a greater selling value on the basis of vacant possession.
My contention is that you may take it always that the house of which you can give vacant possession will fetch more than a house that is occupied.
So long as there is scarcity.
Scarcity or no scarcity.
It is illogical to assume it will. The proposal here is to take advantage of any period of scarcity that may arise to evict tenants and sell their houses. There is no regard to the interests of the tenants who in such circumstances will have great difficulty in getting alternative accommodation except at greatly increased rents. If we are to strike a fair balance between the landlord and the tenant this period of forty years must be very considerably reduced. It has been assumed by some Deputies that we are trying to protect a bad tenant and to give him security of tenure. That is not so. The point is it is only a good tenant who can get protection under this Bill. No matter what the period is that is fixed, whether it is five, ten or twenty years; no matter whether the tenant gets renewal or not, he can always be ejected under Section 19 if he does not pay his rent or if he breaks his contract or gives his landlord any good and sufficient cause to eject him. The landlord can always evade an application for a new tenancy if he desires to rebuild or reconstruct or if he requires possession for the purpose of a scheme of development of the property or any cause consistent with good estate management. The landlord is secure under the Bill of the highest rent he can get on a basis of vacant possession.
Deputy O'Connor, it seems to me, advanced the most extraordinary case of all. I am quite certain that if Deputy O'Connor goes into the library and reads the speeches made by the landlords' representatives in the British House of Commons, when the first Land Bill was before that House, he will find words he used recorded there identically. His attitude in this matter is the very same as those who represented the landlord interests when the first Land Bill was under discussion, when people were talking about giving the farmers fixity of tenure. People got up then and said the landlord may want to sell his land at any time, and does not want to have the tenant as part owner.
There is a difference between land and houses. Houses are put there; the land is there.
Undoubtedly there is a difference, but the fact is the same that there are people in occupation of houses that are as much concerned to remain in occupation of them as the farmers are to remain on their land. The position is, that Deputy O'Connor talks about investments and getting his capital back in ten years, but he knows he is talking through his hat.
I did not say that.
Yes, you did say that. A person putting money into houses is going in for a long term investment and not for investment for the purpose of speculation as a rule.
We are proposing to guarantee that person a safe return and to guarantee it by statute. If Deputy O'Connor chooses to put his money into Hatry shares or railway shares he has no guarantee that it will not disappear in a short time, but, if this Bill is passed, he puts his money into house property, he is guaranteed the highest return which the market will give under the circumstances. Under such circumstances why does the Deputy assume that landlords will not let their houses? What more do they want for their houses except to be in a position to squeeze the tenants, so as to get the last farthing out of them? The only thing that can be advanced for this long period is that it enables the landlords to hold the threat of ejectment over their tenants, so as to get a higher rent than under the terms of Section 27 would be considered a fair rent. If their one desire is to get a fair rent under that section, they need have no fear of shortening the term, because they will get their rent no matter what terms are fixed.
They may want to sell their houses to pay their debts.
They may want to sell them to get an exorbitant price.
At any time, irrespective of conditions, let them sell their houses.
The only reason why they wish to sell now is because there is a scarcity of houses. The landlords realise that persons must get houses, and if they cannot get them to rent they must buy them, even though they have to borrow the money from banks or insurance companies. That is why landlords are anxious to put their houses on the market. They know they can get an enhanced price, as houses are now being sold at 400 and 500 per cent. profit.
Their value has fallen 30 per cent. since the war.
The Bill will kill speculative building.
Why?
Because we built houses to let them to tenants in the past.
If a speculative builder builds a house for the purpose of letting it to a tenant, he gets under this Bill the highest rent he could get on the basis of the best market security.
After five years you give a tenant a claim to my house.
What claim? He has no claim whatever to the house, but he has a right to remain there as long as he pays his rent and observes the contract of tenancy. We are merely asking the Dáil to provide that no bad landlord—and there are some bad landlords, a fact which Deputy O'Connor does not seem to realise—will be allowed to eject his tenant as long as he pays his rent.
We agree with you in that.
That is all I am asking you to do. Deputy Dr. Hennessy will, I assume, vote for the amendment.
There is one point in the Minister's statement which is very strange. He quoted from paragraph 28 of the Report of the Commission in order to justify a long term such as forty years.
Paragraph 37, where the recommendations are summed up on page 25.
Anyhow, the point is this: the Minister, near the end of his speech, went on to justify the long period on the ground that the only reason for giving any concession of this kind was that a certain sentiment had arisen around a house from the tenant's point of view, and that the tenant had become attached to it. As the Bill stands, however, the tenant may have been there only twelve months. It does not apply to people who have been there all the time. Several speakers made the mistake in assuming that the same person had been in occupation for forty years, whereas, as a matter of fact, the tenant may have been there only one, two or five years. If that is the only plea which the Minister can make for the longer term, obviously he has no excuse at all. As Section 17 (b) stands, it reads: "Such tenement was during the whole of the period of forty years next preceding the termination of such tenancy continuously in the occupation of the person who was the tenant thereof immediately before such termination or of his predecessors in title." Further, it is curious that those who are objecting to this amendment did not point to the particular provision in Section 27 which would penalise and be objectionable to the landlords. In that connection I wonder are landlords generally opposed to the proposal which we are making? It seems to me that many landlords would take the view that it would add to the value of their property that it should come under the supervision of the courts five years after it is built. The only thing which I regard as remarkable about the amendment is that it is a very big extension of the principle of State interference and State control. I can well imagine a builder or a property owner who would welcome such a provision, as there is not a single condition in Section 27 that could be regarded as penalising the landlord or lessening the value of his property. I hold that it could well be argued that the provisions of Section 27 would operate to the appreciation of house property. Deputy O'Connor, I notice, talked about the danger of landlords selling their houses the moment this Bill is passed and that henceforward all builders would seek to sell rather than to rent their houses. If such property is not valuable I do not know how the builders are going to sell it. Who is going to buy it? If it is not valuable to one person it is not valuable to another. Again, Deputy O'Connor, who should be in a position to do so, did not point to the provision that would penalise landlords in any way. Altogether, in my opinion, no case whatever has been made against the amendment and I trust that it will be passed.
I would like to assist the Minister in clearing up certain doubts in his mind about this clause. Landlords will take two things into consideration from a purely financial point of view. If a landlord has a lease for 99 years and is about to let a house he will let it at a rent which will give him back his capital in 99 years, making a certain deduction for repairs and so forth, and giving him a fair return on his money. That would correspond to what he would get in a fair trustee security, namely, about four or five per cent. in normal times. Apart from that, he should get back what in 99 years would return him his capital when his property is gone. That is the chief factor in the mind of anyone who wants to have property which he can sell at any time, because at any time, provided the market for houses is not over-supplied —a contingency over which an Act of Parliament has no control, and on which you cannot calculate—a man should be able in normal times to sell his house at a price based on those figures, namely, the number of years in which he will get a return on his capital and the rate of interest as a solid and reasonable security. Therefore he cannot have a flutter with the property and anything which leaves scope, such as this clause leaves, for playing fast and loose with tenants, turning out one tenant and putting in another, in the hope of having a flutter in the market, is dead against the spirit of the Bill itself. The actual effect of this is to exclude tenants from the benefits of the principles which the Minister has established in other parts of the Bill.
I think in the last part of his speech Deputy Little rather damaged what he had been saying in his first speech, because if the landlord wishes merely to have a rent out of his house and wishes to have it for a term of years, then the natural thing he does is to lease it for a long term of years, and this question does not arise. It is only when the landlord does not wish to give a lease and the tenancy is from year to year that this problem arises.
The Minister does not understand my attitude. The ordinary landlord buys property for 99 years, and sets out with the idea of letting his house from five years to five years. It is with that type of landlord I was dealing. I was not dealing with the landlord who simply wanted to dispose of the whole thing and only get the head rent.
I would like if the Minister could hold out any hope of coming to some agreement.
Not on any of these amendments. Even the period of twenty years, which is the longest in the amendments, is too short.
I am in the position of believing that five years is rather short, but yet I hold forty years is rather too long. I appreciate the way in which Deputy Geoghegan approached the amendment when he stated that he hoped that Deputies would discuss it in a calm atmosphere and not introduce any heat. I think if that policy were pursued much oftener, much advantage would accrue to all parties concerned. I am one of those who believe that the landlord has rights and the tenant has also rights. I know from experience that one bad landlord sometimes creates a great deal of trouble. On the other hand, I know also that tenants sometimes are the means of causing trouble in a great many cases unnecessarily with their landlords. That leads to the introduction of legislation that is perhaps not good for the landlord, the tenant, or the country generally. I know that legislation dealing with houses as a rule has a very bad effect in preventing people from building houses to let. That is an aspect of the situation which should be borne in mind very carefully, that owing to the high cost of building it is very difficult to get anybody at the moment to invest in house-building. It is a well-known fact that in pre-war days house-building was a very popular form of investment. Large numbers of people in this country, as well as in other countries, invested their money in house-building, and the relations of landlord and tenant during all those years were of a most friendly character. I am sorry to say that sometimes those relations are not the same to-day as they were formerly.
Under this amendment there will in the natural course of events arise cases of hardship. I have knowledge of the case of a landlord who had occasion to sell his property, and sooner than sell the houses to tenants who paid the rent regularly for years, perhaps for a period of twenty-five years—perhaps during that period he had some altercation with certain of the tenants—he was known to sell the houses at a lesser price to outsiders. I think it is with a view to safeguarding the position of such tenants that the amendment has been introduced. If the Minister could hold out any hope that he would on the Report Stage bring in an amendment that would meet the opinion of Deputies like myself and Deputy Byrne, and perhaps also the opinion of Deputy Lemass, he would be in a position to compromise, and it would be better for all concerned. I am very anxious that the good relations of landlord and tenant should increase rather than diminish. I know it is only by the preservation of such good relations that any advantage can come to both classes, and incidentally to the country in general. I am opposed to the introduction of any legislation that will have a nasty effect on any section of the people. It would be better if we could, like a sensible body of men, arrive at some agreement that would be acceptable to all Parties, and that would impose no hardship on anybody. I ask the Minister to stretch a point, and come to some agreement that would be acceptable to all Parties.
Mr. Byrne
I would appeal to Deputy Lemass in the interests of the tenants to withdraw his amendment.
The question that will be put to the House is that the word "forty" stand part of the Bill. On that Deputies will have to vote.
I think the Minister should explain a curious anomaly that he has created under the Bill. A person who is one year in possession of a house, simply because there has been an uninterrupted tenancy, with which he has nothing to do, has a right to a tenancy under the Bill, while his neighbour who had fifteen, twenty, thirty or thirty-five years in the house next door has not that right. Is not that an extraordinary position which the Minister has created by the Bill? Surely it requires some explanation that a tenant, for no reason for which he has any responsibility, is going to have a privilege of that kind while his neighbour can be evicted, though he is thirty-five years in possession? A tenant who has occupied a house for thirty-five years can be evicted by the landlord, and has no claim for a new tenancy. Surely that is the most extraordinary legislation ever proposed!
Mr. Byrne
May I ask the Minister if there is any hope of a reduction in the period of forty years?
That really does not arise, because I certainly think even the longest period mentioned in any of the amendments is altogether too short, but without making any definite promise to the Deputy or any pledge of any kind, I will consider between now and the Report Stage as to whether the term of forty years might be reduced. It is clear I am not making any definite pledge.
Some consolation.
Acting-Chairman
I will put the question.
If you put the question that the word "forty" stand part of the Bill and that the question is decided in the affirmative, would it be possible for the Minister to amend the Bill in this respect on the Report Stage?
Acting-Chairman
I would say certainly. It stands during the Committee Stage. The word would remain "forty." Any Deputy could move to change that figure on the Report Stage.
Would there be any chance, then, of the two other amendments being moved now? The point is that Deputies should be given an opportunity of moving them now.
Acting-Chairman
If the House decides that the word "forty" stands you cannot substitute "fifteen,""twenty," or "thirty" on this stage.
Would it not be fairer to put one of the other figures?
The other alternative has been adopted before, in my opinion.
Acting-Chairman
I will put the question that the word "forty" stand.
I submit, on a point of order, that you might have the case of a person who might say that he would not vote for five years but he would vote for twelve. He might say, as between forty and five years, that he would prefer forty. I prefer "twelve" to "forty." I think this particular procedure, "That the words stand part of the Bill," flagrantly interferes with the rights and liberties of ordinary members of the House in getting the will of the House in these matters.
Acting-Chairman
It has been ruled over and over again.
Is it not a fact that if we pass "forty" it can be reduced on the Report Stage, while if we pass "five" it cannot be increased?
Acting-Chairman
I will put the motion.
I think if you, sir, refer to the records of the previous day's proceedings you will find there was no mention by the Chair on that day that we were discussing all the amendments to this.
It was stated definitely to-day by the Chair.
Not to-day. A discussion arose on the previous day, but I do not think there was any ruling on the matter.
Acting-Chairman
The practice has always been to put the motion, "That the words proposed to be deleted stand," and I will now put it in that form.
Question put.
[An Ceann Comhairle resumed the Chair.]
The Committee divided: Tá, 63; Níl, 43.
Tá
- Aird, William P.
- Alton, Ernest Henry.
- Bennett, George Cecil.
- Blythe, Ernest.
- Bourke, Séamus A.
- Brodrick, Seán.
- Carey, Edmund.
- Cole, John James.
- Collins-O'Driscoll, Mrs. Margt.
- Conlon, Martin.
- Connolly, Michael P.
- Cosgrave, William T.
- Daly, John.
- Davis, Michael.
- Doherty, Eugene.
- Dolan, James N.
- Doyle, Peadar Seán.
- Duggan, Edmund John.
- Dwyer, James.
- Esmonde, Osmond Thos. Grattan.
- Finlay, Thomas A.
- Fitzgerald-Kenney, James.
- Gorey, Denis J.
- Haslett, Alexander.
- Hassett, John J.
- Heffernan, Michael R.
- Hennessy, Thomas.
- Hennigan, John.
- Henry, Mark.
- Hogan, Patrick (Galway).
- Holohan, Richard.
- Jordan, Michael.
- Law, Hugh Alexander.
- Leonard, Patrick.
- Lynch, Finian.
- Mathews, Arthur Patrick.
- McDonogh, Martin.
- McFadden, Michael Og.
- McGilligan, Patrick.
- Mongan, Joseph W.
- Mulcahy, Richard.
- Murphy, James E.
- Myles, James Sproule.
- O'Connell, Richard.
- O'Connor, Bartholomew.
- O'Donovan, Timothy Joseph.
- O'Higgins, Thomas.
- O'Leary, Daniel.
- O'Mahony, The.
- O'Reilly, John J.
- O'Sullivan, Gearóid.
- O'Sullivan, John Marcus.
- Reynolds, Patrick.
- Rice, Vincent.
- Roddy, Martin.
- Shaw, Patrick W.
- Sheehy, Timothy (West Cork).
- Thrift, William Edward.
- Tierney, Michael.
- Vaughan, Daniel.
- White, Vincent Joseph.
- Wolfe, George.
- Wolfe, Jasper Travers.
Níl
- Anthony, Richard.
- Boland, Gerald.
- Brady, Seán.
- Briscoe, Robert.
- Bvrne, John Joseph.
- Carty, Frank.
- Clery, Michael.
- Coburn, James.
- Colbert, James.
- Corkery, Dan.
- Houlihan, Patrick.
- Jordan, Stephen.
- Kent, William R.
- Killilea, Mark.
- Kilroy, Michael.
- Lemass, Seán F.
- Little, Patrick John.
- Maguire, Ben.
- McEllistrim, Thomas.
- MacEntee, Seán.
- Moore, Séamus.
- Mullins, Thomas.
- Crowley, Tadhg.
- Davin, William.
- Derrig, Thomas.
- De Valera, Eamon.
- Fahy, Frank.
- Flinn, Hugo.
- Fogarty, Andrew.
- Geoghegan, James.
- Gorry, Patrick J.
- Hayes, Seán.
- Murphy, Timothy Joseph.
- O'Connell, Thomas J.
- O'Kelly, Seán T.
- O'Leary, William.
- O'Reilly, Matthew.
- Ruttledge, Patrick J.
- Ryan, James.
- Sexton, Martin.
- Sheehy, Timothy (Tipp.).
- Walsh, Richard.
- Ward, Francis C.
Tellers: Tá, Deputies Duggan and P.S. Doyle; Níl, Deputies G. Boland and Davin.
Question declared carried.
[Professor Thrift took the Chair.]
I move:
In sub-section (1) (c), line 4, to delete the word "fifteen" and substitute the word "three."
This paragraph of the sub-section deals with the case of a landlord who has only three years' reversion and who consequently cannot give a new tenancy for longer than three years. The Bill provides that a tenant who has been fifteen years in occupation can get a new tenancy for fifteen years, and the amendment proposes to reduce the fifteen years to three years. It does not appear that any serious objection can be made to the amendment. It is difficult to understand why fifteen years was decided on in the first instance. The Minister has apparently accepted the principle that where the reversion of the landlord is limited to three years the period of occupation required on the part of the tenant should be lower than where there is no such limitation. Briefly, the proposal is that where the tenant has been in occupation for three years and his tenancy express he should be entitled to a new tenancy for three years where the landlord's reversion does not exceed that period. Of course, the landlord cannot give a new tenancy for a period longer than his own lease. It does not seem to me that any hardship would be done to the landlord if the amendment were carried. The tenant must be a good tenant, paying his rent and observing the conditions of his contract.
I do not see any reason to depart from the carefully considered opinion of the Town Tenants Commission. They recommended that the occupation by the tenant must be a long and substantial occupation, and they put it at fifteen years. It would not be at all within the spirit of their report, what they considered to be fair and equitable between landlord and tenant, that the period should be reduced to three years.
The Minister is getting behind the Town Tenants Commission's opinion on that point when they agree with him, but he runs away when they disagree with him. Has he any argument to advance why a tenant should not get this new tenancy?
There is no line except to make an approximate figure. I agree with the Commission in its report that the tenant's occupation should be of a substantially long term, and not of a short term, which Deputy Lemass wants.
Make it five.
Question—"That the words proposed to be deleted stand,"—put and declared carried.
I move—"In sub-section (1) (d), line 12, to delete the words `one-half' and substitute the words `one-third.' Paragraph (d) of the sub-section proposes to give a tenant a statutory right to a new tenancy if he has effected improvements in the dwelling, which have increased the letting value by 100 per cent. The amendment proposes to give the right to a new tenancy if the tenant has increased the letting value by fifty per cent. It seems to me that the percentage required by the Bill as drafted, is too high. If a person is in occupation of a dwelling, and has made very substantial improvements, sufficient to increase the letting value on the termination of the tenancy by 50 per cent. he should be entitled to a new tenancy. The alternative is to evict him, giving him compensation for the improvements, but no compensation for disturbance. It is reasonable to assume that, where a person incurs considerable expense in effecting improvements in a dwelling, he intends, if possible, to remain in permanent occupation, that he is not a tenant who is merely contemplating a short tenancy. A person who incurs expenditure on improvements is obviously thinking of remaining there for the rest of his life, or for a very long period. It is quite possible that if a very high percentage is fixed in the Bill considerable injustice may be done by a landlord who is anxious to avail of the scarcity of houses and to get a high price on the basis of vacant possession. I think the Minister will see the justice of the proposal in the amendment, and that he will be inclined to accept it.
I am afraid I cannot accept the amendment. Of course, the principle which underlies this is that where a house is as much the tenant's as the landlord's, that then the tenant should have this fixity of tenure which is given over and above the other rights of fixity which he gets under other parts of the section.
The principle is that half the value of the house is his. He is as substantially the owner of the bricks and mortar as the landlord is. He should not be put out because he is, in effect, as much the owner as the nominal owner; as much of his capital is in it as the capital of his landlord. If you depart from that you go on quite a different basis. In every other case all the tenant could reasonably ask for it is that he will get the full letting value of his improvements when he goes out. The increased letting value due to his improvements will be given to him. The principle that lies here is that if a person is as much the owner as the nominal owner, he should be entitled to stop on in possession; as a matter of fact, if his improvements were half the value of the house, he should pay half the old rent.
I am sorry that Deputy O'Connor is not in the House, because he is zealous, perhaps overzealous, in defence of what he conceives to be the feudal rights of property. I think that even Deputy O'Connor would be reluctant to oppose this amendment and advance his reasons for opposing it. I wonder would Deputy Dr. Hennessy oppose it on reflection? Here is an amendment which is calculated to encourage the tenants to expend very considerable sums of money on the property of their landlord. The tenant knows that unless he, or his predecessors in title, have been in occupation of a private house for forty years, he is not entitled to the right of renewal, but under the Bill as it stands he is told that if he expends so much money as will increase the letting value of the house 100 per cent. he will be put in a more favourable position. Is it not vain to hold that out? What tenant will expend such an enormous sum of money as will in the ordinary course increase the letting value of a private house by 100 per cent? It would need to be something enormous.
It is suggested by this amendment that the tenant should be tempted to improve his landlord's property, should be tempted to gild the security for the rent by spending such a large sum of money as will increase the letting value by one-third. Presumably the landlord, in letting a house, is exacting, as is his right, the full letting value of the house. That is not a gilt-edged security. It is the ordinary security of a house let at a competitive rent. The tenant comes along and by the expenditure on that house he increases its letting value by one-third.
These are the terms of this amendment. Is the landlord so jealous of his sovereignty over this house that he will not give that tenant who has expended such a large sum of money in improving the property the right to get continuity of tenure at a competitive rent? That is all he is getting. Will the landlord go that far? I have read of somebody who is astonished at his own moderation. I think that Deputy Lemass has reason to reproach himself for his own moderation in putting in an amendment by which he merely seeks to alter "one-half" to "one-third," because such an increase as one-third is very considerable. Let the members of this House reflect what would need to be done in the way of improvement and extension of an ordinary private house in order to increase its letting value by one-third.
For the sake of the community I would appeal to this House to encourage the tenants so to improve their houses as to bring themselves within this section, by passing this amendment. Whom does it hurt? It merely hurts those who have been described from the benches here, from the Labour Benches, and, I think, from the Government Benches, as those who are fortunate enough to own houses at a time when there may be a famine of houses, and who want to extract the last penny that under famine conditions they can get. Somebody seems to be shocked here. Deputy O'Connor seems to be shocked that the House should try to curb that. He seems to think it was a most unwarrantable interference with the rights of property. He said there should be a distinction between property in houses and property in land. The whole spirit of the present time, not merely in this country but in other countries, is to curb profiteering. Attempts have been made to stop profiteering. A man is not even allowed to sell the goods in his shop sometimes unchallenged at whatever price he could get for them.
The only person who can quarrel with the amendment is someone who says to himself: "I have a house and the time may come, owing to famine, or the opportunity may arise, owing to the peculiar needs of the tenant who may have to reside in that particular district, when I can give him a squeeze and thereby make him pay a faney rent on the house upon which he has spent so much by way of improvement." I think I am entitled to say that the amendment is an extremely moderate one, and I appeal to the House to accept it. I do not know if there is any use in appealing to the Minister. Perhaps he thinks that nothing good can come from these benches. I hope it is not without avail to appeal to the Minister to accept the principle that is embedded in this amendment. The Minister may say whatever fraction you have must be arbitrary. One-half is an arbitrary fraction.
Why not? Why should you select one-half? Why should you not say nineteen-twentieths?
Nineteen-twentieths exceeds one-half.
Why not select nineteen-twentieths? I merely say that the selection of a fraction of one-half is the selection of something arbitrary. No very great justification can be put forward for it, and certainly nothing like the justification that can be put forward for the figure of "one-third," which is the figure that may work and that may encourage the tenants, as I have said before, to bring themselves within this favoured section.
I only just want to say that "one-half" is not an arbitrary figure. The reason why one-half is being taken is that when the tenant has taken a certain building and transformed that building, and, by transforming the building, has turned perhaps a small house into a house double its size, he is really as much the owner of the bricks and mortar as is the person who is the landlord. If it is less than half, he is so much less the owner, and if it is more than half he is so much more the owner. Deputy Geoghegan seems to think that before the landlord can take possession of a house from the tenant who had improved it he will have to pay down in hard cash to that tenant the value of those improvements. He cannot, under this Bill, enrich himself by the tenant's improvements, because he has to pay the full letting value of these improvements to the tenant when the tenant goes out.
[An Ceann Comhairle resumed the Chair.]
Deputy Geoghegan also seems to labour under the delusion that this is a sort of compulsory eviction Bill; that in every case which is not provided for by this Bill the landlord is bound to evict. Of course, that is not so. If a landlord has a good tenant and yet has very good reasons for taking possession, you may be perfectly certain that he is not going to pay down a large sum out of sheer wantonness.
The Minister was incorrect in one particular. He said the tenant must have spent as much on a house as the landlord. He may have to spend more, because he will have to double the letting value of the house, and the letting value of the improvements would be likely to be less than the original letting value. The landlord might build a house for £400 or £500. The tenant may add a garage at a cost of £100, and probably not increase its letting value by one-fourth or one-fifth, as the case may be. The law of diminishing returns operates in this case. It is quite possible that even if the tenant's improvements equal the cost of the construction of the original building, nevertheless the letting value might not increase more than fifty per cent.
I do not agree with the Deputy that the law of diminishing returns necessarily applies to improvements to premises. The law of diminishing returns can only apply when you purchase a house which had become such a mansion that it would be for practical purposes unletable.
Question—"That the words `one-half' stand"—put.
The Committee divided: Tá, 65; Níl, 41.
Tá
- Aird, William P.
- Alton, Ernest Henry.
- Bennett, George Cecil.
- Blythe, Ernest.
- Bourke, Séamus A.
- Brodrick, Seán.
- Byrne, John Joseph.
- Carey, Edmund.
- Cole, John James.
- Collins-O'Driscoll, Mrs. Margt.
- Conlon, Martin.
- Connolly, Michael P.
- Cosgrave, William T.
- Daly, John.
- Davis, Michael.
- Doherty, Eugene.
- Dolan, James N.
- Doyle, Peadar Seán.
- Duggan, Edmund John.
- Dwyer, James.
- Esmonde, Osmond Thos. Grattan.
- Finlay, Thomas A.
- Fitzgerald-Kenney, James.
- Gorey, Denis J.
- Haslett, Alexander.
- Hassett, John J.
- Heffernan, Michael R.
- Hennessy, Thomas.
- Hennigan, John.
- Henry, Mark.
- Hogan, Patrick (Galway).
- Holohan, Richard.
- Jordan, Michael.
- Keogh, Myles.
- Law, Hugh Alexander.
- Leonard, Patrick.
- Lynch, Finian.
- Mathews, Arthur Patrick.
- McDonogh, Martin.
- McFadden, Michael Og.
- McGilligan, Patrick.
- Mongan, Joseph W.
- Mulcahy, Richard.
- Murphy, James E.
- Myles, James Sproule.
- O'Connell, Richard.
- O'Connor, Bartholomew.
- O'Donovan, Timothy Joseph.
- O'Higgins, Thomas.
- O'Leary, Daniel.
- O'Mahony, The.
- O'Reilly, John J.
- O'Sullivan, Gearóid.
- O'Sullivan, John Marcus.
- Reynolds, Patrick.
- Rice, Vincent.
- Roddy, Martin.
- Sheehy, Timothy (West Cork).
- Thrift, William Edward.
- Tierney, Michael.
- Vaughan, Daniel.
- White, John.
- White, Vincent Joseph.
- Wolfe, George.
- Wolfe, Jasper Travers.
Níl
- Anthony, Richard.
- Boland, Gerald.
- Brady, Seán.
- Briscoe, Robert.
- Carty, Frank.
- Clery, Michael.
- Colbert, James.
- Corkery, Dan.
- Crowley, Tadhg.
- Davin, William.
- Derrig, Thomas.
- De Valera, Eamon.
- Fahy, Frank.
- Flinn, Hugo.
- Fogarty, Andrew.
- Geoghegan, James.
- Gorry, Patrick J.
- Hayes, Seán.
- Houlihan, Patrick.
- Jordan, Stephen.
- Kent, William R.
- Killilea, Mark.
- Kilroy, Michael.
- Lemass, Seán F.
- Little, Patrick John.
- Maguire, Ben.
- McEllistrim, Thomas.
- MacEntee, Seán.
- Moore, Séamus.
- Mullins, Thomas.
- Murphy, Timothy Joseph.
- O'Connell, Thomas J.
- O'Kelly, Seán T.
- O'Leary, William.
- O'Reilly, Matthew.
- Ruttledge, Patrick J.
- Ryan, James.
- Sexton, Martin.
- Sheehy, Timothy (Tipp.).
- Walsh, Richard.
- Ward, Francis C.
Tellers: Tá, Deputies Duggan and P.S. Doyle; Níl, Deputies G. Boland and Little.
Question declared carried.
Question proposed: "That Section 17, as amended, stand part of the Bill."
I would like the Minister to tell me whether it is quite clear that the section covers a person who has been in occupation under a building lease which expired two or three years ago and who is still in occupation as an ordinary tenant. Is that person covered by this section of the Bill? If the occupation is for forty years is he entitled to a new tenancy?
There are various amendments dealing with the position of persons who are holding on under the Increase of Rent Acts or who are merely in occupation. I am coming to these amendments later on. I have several amendments down, as the Deputy is aware, and they will cover this position. So to speak, under the amendments his new interests will be a graft on his old interests.
Section 17, as amended, agreed to.
Amendment 48 not moved.
SECTION 19.
I move amendment 49:—
To add at the end of sub-section (1) a new paragraph as follows:—
(f) his tenancy is that of a corporate body not registered under the Companies Acts, 1908 to 1924, in Saorstát Eireann and is situate in an urban district, a town or a village but not in a county or other borough.
This is to meet a case where big companies such as banking companies or insurance companies are tenants to small landowners, people who have only one house. These people are not resident within the State, and I think things should be left as they were before and that a rich corporation should not benefit by the Act. That is my reason for moving this amendment.
I am afraid I cannot accept this amendment. After all, the law must be the same whether the person is rich or poor. You cannot alter it. We cannot say that we will single out certain persons, classes of persons or houses and say that they should be exempt from the provisions of the Act. I quite understand that a person who thinks he might be able to raise the rent unduly to a wealthy corporation may feel a little aggrieved, but, as I say, we cannot have a law for one person and a different law for another.
I quite agree that the law should be the same for both the rich and the poor. I am glad the Minister said that. It indicates a welcome change in the policy of Cumann na nGaedheal, but it has nothing to do with this amendment. The amendment relates to companies registered outside the country, and the law need not necessarily be the same for foreigners as for our own citizens. The proposal is that companies registered outside Saorstát Eireann should be debarred from the right of new tenants under the Bill. Of course there is a limitation in the amendment, which suggests that Deputy Reynolds is more concerned with a particular case in Co. Leitrim than with the general principle. I am more concerned with the general principle, and I would like to see what the policy is, and if it is the policy of the Government to discourage the operations of foreign companies here by depriving them of the right of security of tenure in any buildings in which they may have a tenancy.
This Act deals with a question of right or wrong. If it is right that persons who are citizens of our State, having done certain things, should have property here, I think exactly the same principle applies to persons who are foreigners. Justice is justice, no matter who the person is, and if it is just for one of our citizens on certain occasions to acquire certain rights, then it appears to me it is equally just for persons who are not our citizens to acquire those rights equally, and differentiation such as Deputy Lemass pointed out would be, to my mind, extremely unfair. As Deputy Lemass, after all those years, is so completely ignorant of Cumann na nGaedheal policy, I am not surprised at any arguments he puts forward here.
We never heard it explained.
We cannot get it explained now on this amendment to this Bill.
The effect of this amendment, if carried, would be that a number of companies would proceed to register in Saorstát Eireann, which, I hope the Minister will agree with us, would be a very excellent thing. As to treating the citizens of this country and other countries with equal justice, I think that is a fair principle to establish; but would it be a fair thing or a just thing for a citizen of this country to register his company in England and to start his business here? I do not think it would, and it would be against public policy. The law should be the same for a citizen of this country as for any alien or stranger, and for that reason I think it is right that people running big business corporations or companies of all sorts should be registered in this country. The effect of this amendment would be to force a number of companies to register in this country where they are registered elsewhere.
This is a completely different problem, but the Deputy must bear in mind that, say, these companies which are so registered in Northern Ireland or England and carry on business over here will not change their registration, because they may lose rights in one or two premises. They have to look to their major business, and naturally their major business is carried on in the place where they are registered.
I hope Deputy Reynolds will make a fight for his amendment.
We have to stand up for fair play. The people I refer to are poor landlords with only one house, and these other people are rich corporations or companies. I think it is only fair that the poor man should not be jeopardised by this Bill. The Minister, I am sure, will agree that it is a small amendment, and, as Deputy Little said, if passed it will bring revenue to the country because it will be the means of getting some of these companies to register here. In all fairness, I think the Minister ought to accept it.
Amendment put and declared lost.
I move amendment 50:—
To add at the end of sub-section (1) a new paragraph as follows:—
(f) in the case of a tenement used as a residence the landlord owns or occupies but one premises used as a residence other than such tenement.
I hope I will be more successful than my neighbour, Deputy Reynolds, in moving this amendment. However, I am not over-optimistic, as I have heard peculiar ethics enunciated in connection with this Bill, especially from the Opposition, and I do not make much discrimination between the different sections of the Opposition. Section 17 of this Bill particularly perpetuates the Rent Restrictions Act, in some respects at least, and especially in the case of the owners of houses with whom my amendment deals. The object of my amendment is that people who bought a house before the passing of the Rent Restrictions Act with the idea of occupying it at a future date should be exempted. These people belong to classes such as civil servants. Some of these civil servants were able to keep a better house while in the Civil Service, but when pensioned they were not able to live in their houses. They scraped as much money as they could and bought a smaller house than the one they were residing in with the idea that they would occupy it when they went out on pension. Then we have widows of doctors, solicitors, and so on. Deputy Lemass leers at all this. I do not expect much sympathy from Deputy Lemass from what he has already said, but this is a thing that should not be treated lightly. It is a tragedy for those people. If Deputy Lemass had the same human nature as I possess and was as accessible as I am, he would have been approached and would have heard something about those people. They have come to me and put their case before me. They bought those houses with the idea of occupying them so that they may be able to give cheap education to their children when they arrived at a certain age. They let the houses temporarily, and in most cases before the Rent Restrictions Act was passed. The result was that they could not get possession of these houses. I need not go into the different reasons why they could not get possession, but it was obvious that the Rent Restrictions Act did not facilitate owners of houses in getting possession. Some of them are in the position that they want to sell the houses. It is a case of grim necessity with them to sell the houses to meet part of their debts. They find that they cannot sell the houses, and even if they are optimistic enough to hope that the Rent Restrictions Act will be repealed they are caught under this Act and they still will not be able to sell the houses or get possession of them. These are nearly all owners of one house. They have been called landlords, but they are owners in the same sense that a tenant farmer in Ireland is the owner of his farm. It has been said that the occupying tenant should be put in the same category as a tenant farmer. He is not in the same category. The tenant of a house simply occupies a house and pays for the use of it. The tenant farmer owns the house, because he has bought it or inherited it from those who went before him. It is the same way with the people whose cases I am urging. They also bought the houses, or perhaps inherited them from their forebears. Of course I know cases of tenants of land who hold on the eleven months' system. They are graziers, and after five or forty years they cannot claim a renewal of the tenancy nor prevent the farmer who owns the land from selling it in the open market. What I claim for these people is that they should be in a position, especially when it is a case of grim necessity with them, to sell the house in the same open market in which they bought it. They are owners of one house, and they are very poor people. I do not care what fixity of tenure you give a tenant so long as you give the owner of a house, especially the owner of a single house, the right to sell it when it becomes an absolute necessity for him, perhaps to pay debts which he is compelled by the law of this State to pay. I do not care particularly for the morality of this Bill or the honesty of it, though Deputy Geoghegan gave me a little lecture about honesty.
I merely intimated that you were a monopolist of honesty.
I think it a most unfair thing that these people should be deprived of their property. I know that Deputy Lemass or Deputy Little will get up and tell me that they can sell the income of the house by way of rent.
Why not wait and hear them?
I have heard them before. I am avoiding the necessity of repeating it. However, I will be told that these people can sell the rent of the house. Selling the rent of a house is a very different proposition from selling a house and giving possession of it to a purchaser who wants to occupy it.
I think that will be admitted, and I think the Minister will bear it in mind. We have not the same scarcity of houses now as when the Rent Restrictions Act was passed. That is mainly due to the fact that the Government have given very large grants for the building of houses, with the result that nobody has a difficulty in getting a house at present. My experience is that they have no real difficulty. People want to get this fixity of tenure under this section simply because they want to get something to sell. I have already told the House on another amendment of a case where an occupying tenant waived his rights under the Rent Restrictions Act for the sum of £300 and allowed the owner, a very poor woman, to sell the house. That is what you are creating here, and I say that is dishonest. I ask every Deputy to give this very sympathetic consideration. I think that these are cases in which there should be exceptions made. I regard anybody who will vote against this amendment as fit simply to rob a little robin's nest. From the arguments I have heard, I am coming to believe that Deputies who, when considering many questions vote away other people's property, have lost any belief in such a place as Hades, where they will suffer for their sins. I fear that very much. I fear also that they think it is the easiest thing in the world to get into Heaven, and that no man is too great a blackguard to be forgiven and find a ready acceptance in Heaven. I do not agree with that.
It is a long way from this amendment.
I ask the Minister to bear all this in mind. I do not want to intimidate Deputies, but I hope the Minister, as a Christian man and a Heaven-inspired man, will accept the amendment.
Not being a paragon of all the virtues like Dr. Hennessy, I am afraid I shall have to oppose the amendment.
It must be a very good thing for a person in Deputy Dr. Hennessy's position to know that he possesses all the honesty, morality and justice that he contends he possesses. If all the landlords go to Heaven I do not suppose Hell can be so bad a place after all. Deputy Dr. Hennessy said that there was no scarcity of houses and that nobody has any difficulty in getting a house. I advise him to have a consultation with Deputy O'Connor who, half an hour ago, told us that no tenant will be accepted by any landlord now, and that it is practically impossible to get a house to let in Dublin. They cannot both be right. Deputy Dr. Hennessy, of course, being honest, moral, just, and everything else, must be right and Deputy O'Connor must be wrong. As Deputy Dr. Hennessy is so anxious to start out on a new crusade, let him start with his colleague, Deputy O'Connor. He is likely to have more success there than anywhere else.
I may say that the great trouble in getting a house to let now is that the people who own houses have sized up the spirit of the Dáil here, or at least, of the potential Government, and they simply sell a house when it becomes vacant.
As the Deputy referred to me as stating that nobody will let a house now, I should like to say that I built two houses recently and have let them and not sold them.
Deputy Dr. Hennessy has contradicted himself and Deputy O'Connor has contradicted himself, so now we know where we are.
Now we can come back to the amendment.
When I read the amendment I thought it was Deputy Dr. Hennessy's purpose to provide that nobody should get a new tenancy unless the landlord occupies two premises for dwelling purposes. From his speech I take it that is not his aim. His aim is to provide that if the owner of a house is a poor man, then he can do all the injustice he wants and can be released from all his obligations under the Bill. He can evict a tenant, no matter how long he has been in occupation. He can charge any rent he can get, no matter how exorbitant. He can force up the price in any way he likes, provided he is poor. That is Deputy Dr. Hennessy's proposal.
The Deputy has just voted for a section of the Bill which provides that a person who has been in occupation of a house for forty years is to be given security of tenure. We tried to reduce that period, but despite our efforts that forty years stands. Deputy Dr. Hennessy even thinks that forty years is too short a period, provided the house is owned by a poor man who has only one other house in which he resides. If he is a poor man, he is entitled to do anything he likes. He is to be given every facility to squeeze his tenant, to charge whatever rent he likes, and to evict him for any cause, or even without cause, provided he is a poor man—not necessarily a poor widow. He talked about a widow, but the owner need not be a widow. There is nothing in this amendment about widows. It only refers to a landlord who owns one house besides the house he lives in, and he is to be allowed to do anything he likes. Where is the justice in that? What about the honesty, the morality and all the rest of it which the Deputy talks about? Do they only apply to the rich, not to the poor at all? If Deputy Dr. Hennessy is half as honest or moral or just as he pretends to be, he will withdraw the amendment.
For very much the same reasons that I gave in opposing Deputy Reynolds' amendment I must oppose this amendment also.
The Minister is going to rob the robin's nest.
Or he will be sent to Hades.
I may be, but I do not think it is for anything which is done in this Bill. Deputy Dr. Hennessy should bear in mind that this Bill is the outcome of the report of the Town Tenants Commission, which was composed of men of standing in the country who were not out to rob anybody. They were simply out to do justice between two sections of the community, whose interests very seriously clash. If I may say so. I would think that my chances of getting to Heaven were increased rather than diminished by the introduction of this measure, but that is a matter of opinion. Now to get down to the serious thing here. This amendment simply means that if a person is going to take a house one of the first things he has to do is to examine into the financial condition of his landlord. A house will be of a different value if you discover that your landlord has only another house. Then you may be in a very bad position also, because you may take a house which you think will come under the Act because the landlord has got four houses. But he promptly goes away and sells two, and you are completely done. I, personally, do not think, apart from considerations even of that nature, that you can have a law differentiating between persons according to the length of their purse.
Apart altogether from the argument for or against this amendment, there is this consideration: the amendment does not deal with the case put by Deputy Dr. Hennessy at all. He made an ad misericordium appeal for persons who had no other means of subsistence, which is quite a different thing. If he had made an ad misericordium appeal on behalf of persons who had no other means of subsistence than their house rents it would be different, but here you may have a millionaire with a large residence, and property invested in stocks and shares, and only one other house. He is going to be exempted. Even the amendment, as drafted, does not meet the question that Deputy Dr. Hennessy wished to safeguard.
[Deputy Fahy took the Chair.]
Could Deputy Dr. Hennessy tell us what was the law in Ireland on this matter before the Milesians?
The alliance is too much for me. I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question proposed: "That Section 19 stand part of the Bill."
With regard to Section 19, the words "good and sufficient reason" in sub-section (2), I understand under the 1906 Act could include a refusal by the tenant to pay a reasonable increase of rent. In this Bill there is an attempt made to define the expression "good and sufficient reason" by sub-section (2), but it is not at all clear whether that ruling of the court that I referred to is now excluded or not. If it were here we might have a word or two to say upon that subject. Perhaps the Minister would say whether the intention was to give a definition of "good and sufficient reason" that would exclude such a proposal as that. That is to exclude from the meaning of the term a proposal to increase rent.
"Good and sufficient reason," as it comes in here, means something that emanates from the tenant, something that shows that the tenant is an undesirable tenant, and that is a matter which the court must in the circumstances determine on the merits of any particular case. Of course, refusal to pay rent would be good and sufficient cause.
Refusal to pay a reasonable increase of rent, I think, was the decision of the court under the 1906 Act, but apparently the Minister is not prepared to give me information upon it.
As the Deputy is perfectly aware, when the rent in this case is fixed by the court such a question could not arise.
The tenant shall not be entitled to a new tenancy under the definition I have referred to if he has already refused to pay a fair and reasonable increase of rent.
You may take it that is not the case. It is perfectly plain.
I assure the Minister it is the case under the 1906 Act.
Question—"That Section 19 stand part of the Bill"—put and agreed to.
SECTION 20.
(1) Where it appears to the court either—
(a) that the landlord of a tenement to which this Part of this Act applies bona-fide intends, desires, or has agreed to pull down and rebuild or to reconstruct the buildings or any part of the buildings included in such tenement, or
(b) that such landlord requires vacant possession of such tenement for the purpose of carrying out a scheme of development of property which includes such tenement, or
(c) that for any reason the creation of a new tenancy in such tenement would not be consistent with good estate management,
the tenant of such tenement shall not be entitled under this Part of this Act to a new tenancy in such tenement.
(2) Where the court is satisfied—
(a) that the tenant of a tenement to which this Part of this Act applies would, but for this section, be entitled under this Part of this Act to a new tenancy in such tenement, and
(b) that, during the whole of a period of three years expiring at or within three months before the termination of his tenancy in such tenement, such tenement was used by the tenant for the time being thereof wholly or partly for the purpose of carrying on therein a business,
such tenant shall, in lieu of a new tenancy under this Part of this Act, be entitled, on quitting such tenement on the expiration of such tenancy, to be paid by the landlord of such tenement compensation (in this Act referred to as compensation for disturbance) in accordance with this Act.
I beg to move amendment 51:—
In sub-section (1) (a), line 57, to delete the word "desires."
Amendment agreed to.
The following amendments were on the Paper in the name of Deputy Lemass:—
In sub-section (1) (a), line 60, to insert after the word "tenement" the words "and bona-fide to commence such pulling down and rebuilding or reconstructing within six months of the date of the order of the court."
In sub-section (1) (b), line 4, to insert after the word "tenement" the words "and bona-fide intends to commence the carrying out of such scheme within six months of the date of the order of the court."
Before sub-section (2) to insert a new sub-section as follows:—
Where the court decides under paragraphs (a) or (b) of the foregoing sub-section that a tenant is not entitled to a new tenancy and the landlord fails to commence the pulling down and rebuilding or reconstruction of the buildings or the carrying out of the scheme of development within six months of the date of the order of the court, such tenant shall be deemed to be the tenant of such tenement and entitled to all the rights of a tenant under this Act, without regard to any compensation which may have been paid.
The purpose of amendment 52 is to provide some limit of time in which the rebuilding and reconstruction of the dwellings or the building as mentioned in the paragraph will be commenced. In a subsequent amendment standing in my name, certain penalties are provided in the event of failure to carry out the rebuilding or reconstruction. The big fault of the section as it stands is that there is no penalty whatever provided, and a tenant might be deprived of a new tenancy on the grounds that a landlord was able successfully to contend in court that he intended to pull down or reconstruct the dwellings even though he subsequently failed to carry out such pulling down, or reconstructing or rebuilding, as he had undertaken to do when before the court.
I realise there are many loopholes in my amendment and that it is not water-tight. The size of the operation which may be described as the commencement of the pulling down and the rebuilding would be a matter of considerable doubt, but I do think that there should be some provision here inserted to insure that a landlord who deprived a tenant of the right of a new tenancy on the ground that he intended to rebuild or reconstruct should commence and be compelled to rebuild or reconstruct within a definite time, failure in which would restore to the tenant his original right of a new tenancy as otherwise guaranteed under the Bill.
Amendment 53 proposed to insert a similar provision in respect of paragraph 3, which relates to the carrying out of a scheme of penalties and to provide that if the landlord deprives a tenant of a new tenancy on the grounds that he is carrying out a scheme of improvement on the property he should be under an obligation to commence that scheme in a period of six months, and that failure to do so would restore the tenant to his right to a new tenancy. Amendment 54 provides that where the court has decided the tenant is not entitled to a new tenancy under paragraph (a) or (b) on the ground that the landlord intends to carry out reconstruction or rebuilding or a scheme of development, if the landlord fails to commence his rebuilding scheme in six months the tenant would be deemed to be the tenant of the tenement and would be entitled to all rights under the Act regardless of whether compensation for improvements or disturbance had been paid. The Minister may criticise the particular proposals I am making. I realise they are not perfect. I found it extremely difficult to draft an amendment embodying my ideas, but I think that there should be inserted in the Bill some safeguard of this nature to prevent tenants being deprived of their rights either by fraudulent misrepresentation to the court or representations that ultimately were departed from.
I agree with a great deal of what Deputy Lemass has said. His particular amendments, however, do not commend themselves to me, because I think the landlord might require possession of a premises for the purposes of a genuine reconstruction scheme and that he may get possession of this house to-day and possibly may not be able to get possession of the neighbouring house for another year.
He cannot really start a reconstruction scheme economically until such time as he would be prepared to carry out the whole scheme together. To put a time limit, irrespective of what the circumstances might be, would, I think, be practically impossible. So far as the two first amendments are concerned, namely, 52 and 53, I will undertake to bring in, on Report, some amendments which, in my view, would be workable. They would probably be on the lines that a court would fix a definite period and that the work would have to be carried out within that period. The other question, as to what the remedy would be, is a very doubtful one, because if the landlord were given two years to carry out something and did not do it, the tenant, having been declared to be the tenant, would have to pay over the whole year for what he did not enjoy at all. The tenant, in all probability, in the meantime would have made other arrangements and gone elsewhere. I will bring forward amendments on the lines I have indicated on the Report Stage.
Amendments Nos. 52, 53 and 54, withdrawn.
I move amendment No. 55 as follows:—
Before sub-section (2) to insert a new sub-section as follows:—
"Where it appears to the court that it is equitable and practicable that the tenant of a tenement who is held not to be entitled to a new tenancy on the ground that the landlord bona-fide intends to reconstruct the buildings, should receive a tenancy in such reconstructed buildings, the court, in lieu of compensation under the next following sub-section may order the granting of such tenancy on such terms as in the opinion of the court, justice may require."
This amendment is intended to deal with the case of a tenant who is held not to be entitled to a new tenancy on the ground that the landlord, bona fide, intends to reconstruct the building. It is intended in this amendment to provide, where it is practicable and where the court thinks it is equitable to do so, that the tenant should be given the right to a tenancy in the reconstructed building. In a number of cases it will not be practicable to do that. A shop may be reconstructed into two, or two shops may be reconstructed into one, but where reconstruction is of such a nature that the reconstructed building would be suitable to the same business as carried on before, and where the building is one which the tenant would like to occupy, we think that he should have a right, in lieu of compensation for disturbance, to a tenancy of the building when reconstructed, if he desires. If he finds that the building on reconstruction was unsuitable to his business, or for any other reason that he cannot occupy it, he could take the alternative of compensation for disturbance. We think that he should be given the right of exchanging compensation for disturbance for the right of a tenancy.
I am afraid that I cannot accept the amendment. I think that when the landlord, bona fide, for the purposes of the development of a district, decides to change the character of the buildings there, and where he himself prefers to pay the very substantial sum which he would have to pay to the tenant of a business premises when he is removed should be given a free hand as to how he is to reconstruct. If the landlord and tenant come to agreement, well and good, but I think if he is going to the expense of improving the whole place he should be given a completely free hand as to how he is going to deal with the reconstructed premises. In practice, I do not think that the amendment would work, because if the landlord and tenant wished to resume their business in the newly-constructed premises and if they are suitable, they would, of course, come to an agreement, but if the landlord does not want the tenant he would probably change the character of the newly-constructed building in order to keep the tenant out. When the landlord is bona fide improving the neighbourhood I think that the tenant should be satisfied with compensation.
Amendment, by leave, withdrawn.
I move amendment 56 as follows:—
To add at the end of the section a new sub-section as follows:—
"The amount of compensation payable under this section shall be a charge on the estate or interest of the landlord in the tenement in priority to all other charges, mortgages, or encumbrances thereon."
The purpose of the amendment is to provide that the amount of compensation payable under the section shall be a charge on the estate, or interest of the landlord in the tenement, in priority to all other charges, mortgages or encumbrances thereon. Although I realise that there is a considerable difference between the circumstances under which compensation is payable under this Part of the Bill and that payable under Part II, I think there is a case for this amendment. It is possible that the landlord would have mortgaged his interest in the premises and would be otherwise without resources and that the tenant, who has been deprived of the right of a new tenancy and awarded compensation for disturbance, might not be able to collect that compensation. The proposal is to make the compensation a charge against the tenement instead of a personal charge against the landlord. That secures for the tenant the certainty of the payment of compensation, if it is awarded. The circumstances under which it is awarded, under this Part of the Bill, are, we must bear in mind, that the tenant's business, to which he devoted his energy and in which he created substantial good-will, has been taken from him. He can suffer considerable loss, even his whole life's work, and there is no doubt that he should get whatever compensation the court awards him.
I cannot accept the amendment. Amendment No. 11 stood on quite a different footing because it referred to cases where the premises had been improved and then the mortgagees, or other persons interested in the premises, would get the increased security because the value of the premises had been increased by that amount. Here, however, quite a different consideration arises. It is proposed that the tenant is entitled, not for anything he had done to improve the premises, but to compensation for the loss of his good-will, which really is a thing which could not be assessed, as far as the improvement of the security which the mortgage has got, is concerned. I admit that there will be hardship in certain cases, but it will probably be a very odd case in which a tenant will discover that though he has got a decree the man against whom he has got it is insolvent. I am afraid that cases of that kind always have to occur. It is only a question when a man becomes insolvent as to which class of person is to suffer. If you are, unfortunately, run down by a motor car you may, in the circumstances, be fortunate enough to be run down by a person who is insured, or you may be unfortunate enough to be run down by a person who is not insured and who is not worth a penny. Sometimes you have writs against persons to recover damages which may not be worth the paper they are written on. These things, however, will happen. In this case, however, if people advance considerable sums of money on houses and are not guilty of negligence in any way and find themselves suddenly in altered financial circumstances, a thing which they could not possibly foresee, it would not be fair to adopt this method of recovery. I cannot accept the amendment.
Might I suggest to the Minister that the amendment of Deputy Lemass might be met in this way. I think there is a good deal to be said in support of the general principle at the back of the amendment. That is, that a tenant who finds himself dispossessed in pursuance of the provisions of the section, might subsequently find that the landlord, against whom the order for compensation had been made, was not in a position to pay it. I would suggest that sub-section 2 of the section might be amended, by providing that the court would have power to specify the time within which the compensation shall be paid, and that in the event of the compensation not being paid within the time specified, then the order excluding the tenant from the right to obtain a new tenancy under the general provisions of the Act would be inoperative and void.
I will turn over what the Deputy has stated in my mind, but I do not know how that would fit in with the general matter. This is a case that I think practically will not arise, because the case in which it would become really a practical question would be a case in which the landlord is pulling down the premises for the purpose of rebuilding and reconstructing the property. I do not think that you would ever find in practice that a landlord who is improving his property would be bankrupt. I think it is really a very theoretical question. I will consider it, but I will not pledge myself to bring in an amendment. I will consider what the Deputy has stated.
I would have thought that the Minister has just stated reasons for the acceptance of the half-way course suggested by Deputy Finlay. If, as the Minister indicates, the landlord who contemplates rebuilding and reconstruction on a fairly large scale is genuine in his intention, and has at his command resources which will enable him to carry out that scheme, it is no hardship upon him to impose the condition that Deputy Finlay suggested —that it should be made a condition of his obtaining an order for vacant possession, that he should within such time as the court should consider reasonable—it could be left fairly flexible—pay or secure the compensation which has been adjudged to the tenant. If he has these resources at his command, it will be really no burden on him, and it will give the tenant an easier night's rest if he knows that he has at least some slight measure of security for the money.
I have already stated that I will consider Deputy Finlay's suggestion.
The Minister hedged it round with many reservations.
Of course, I do not like to give a definite promise until I have made up my mind.
The Minister sometimes makes up his mind very quickly.
Amendment, by leave, withdrawn.
Question—"That Section 20, as amended, stand part of the Bill"—put and agreed to.
SECTION 21.
Where a court awards to a tenant compensation for disturbance the measure of such compensation shall be the pecuniary loss, damage, or expense which such tenant sustains or incurs or will sustain or incur by reason of his quitting the tenement in respect of which such compensation is awarded and which is the direct consequence of his quitting such tenement.
Amendment 57 not moved.
I move amendment No. 58:—
In line 31, to delete the word "direct."
The section deals with the measure of compensation for disturbance and provides that the measure shall be the pecuniary loss, damage or expense which the tenant sustains as a direct consequence of his quitting the holding. It is not clear what is the exact consequence of the word "direct" or what interpretation the court is likely to put on it. If there is any doubt what the interpretation is to be, I do not think we should pass it, because it is quite possible that we might find, in respect of the Bill when it becomes an Act, as was found in respect of previous Acts, that the intention of the Oireachtas would be reversed by a judicial decision based upon faulty or ambiguous phrasing. It is our view that the measure of compensation should be the loss, damage or expense which the tenant has suffered as a consequence, direct or indirect, of his having quitted the holding. I would, of course, limit the phrase "indirect." I would not put it in the Bill, but I think the word "direct" should not be in the Bill either, because it narrows the meaning very much. It might result in a very restricted interpretation which would involve hardships on tenants deprived of tenancies under this section or the previous section, and it might make it necessary for the Minister to acquire the bad habit of the Minister for Local Government and come along with another Bill to remove doubts.
I think the word "direct" is necessary and that what the word "direct" means is a natural consequence of the removal. If you do not stick to the natural consequences, you would have, as the Deputy himself says, to go and inquire what was an indirect consequence, and the most far-fetched thing might be put forward as a consequence of the removal. It is only the direct and immediate consequence for which the landlord should be liable. For instance, suppose a man came forward after being removed from a house and that the measure of compensation was to be an indirect consequence of his loss, he might say: "Oh, I went into another house and the house was damp. My wife got a cold and I had to pay £40 in doctors' bills," or something of that kind. That would be, in a way, a consequence of his moving, but obviously not a direct consequence of his moving. If you take an indirect consequence, it would be a subject of compensation.
I am not suggesting that.
It is perfectly obvious that an indirect consequence of that nature is not what we contemplate as being the measure. You have to put in the word "direct" in order that these claims should not be brought forward. I have mentioned only one case, but there might be many other similar cases.
I wonder will the Minister, on reconsideration, repeat or endorse some of the statements that have fallen from him now? Will the Minister deny that the law, as it stands, excludes remote damage or remote compensation of the kind that the Minister indicated as necessary to be excluded? The law already excludes that, and it surely does without the use of the word "direct," whereas if you introduce the word "direct" to the statute the court must seek to give some meaning and effect to it. The court must assume that this Legislature did not lightly put in the word there, and the court must give it a limiting effect.
The effect of the word "direct," if left there, is that compensation which, according to the ordinary rules of the law for the ascertainment of damage or the ascertainment of compensation, is to be cut down owing to the effort that the court must necessarily make to give some meaning and force to the word. Subject to correction by the Minister, I suggest that the law of the land already excludes remote damages and remote compensation such as would be unfitting to be paid.
I agree with the Deputy that the measure of damages in an action for tort is the natural and probable consequences of the result. If it were not the result of probable consequences then the damage is too remote. I do not know that in a section of this nature precisely the same principles of interpretation would apply. I think it is safer to have the word "direct" inserted in order to make it plain that it is to be the natural and probable consequences.
On the reading of the word "direct" can a person applying to the court get anything more than the price of removal? The only immediate direct consequence is that he has to move his things out.
Compensation for disturbance may be much more than compensation for removal.
Would the Minister accept the word "natural" that he mentioned in the beginning himself?
I think the word "direct" is an admirable word to express the idea.
The Minister explained that the intention of the adjective is to limit compensation to something less than it would be under the existing law.
You cannot go into a roving inquiry as to what remote consequences may be.
Are not remote consequences excluded at present?
This is an entirely new definition, and is largely borrowed from the definition in the Report of the Town Tenants Commission. It makes the measure of damages for compensation far and away wider than the old measure of damages. If the Deputy reads the Report of the Commission he will see that the Commission expressed the view that one of the failures of the old Act was that the measure of damages awarded by the court was too narrow, and that adequate compensation was not given. To counteract that, it was suggested that an amendment of the law should be made and that damages should be measured according to this definition practically.
That is not the definition of the Town Tenants Commission at all. The Minister on previous amendments has taken shelter behind the recommendations of the Commission. The Commission did not recommend the word "direct." The Minister is inserting that word himself. In paragraph 16 the Commission recommend that the compensation should be for the loss, damage or expense which the tenant sustains or incurs or will sustain and incur by reason of quitting the holding. That is a different definition from what the Minister proposes.
No. Of course in a report of that nature you do not have the precise drafting that you get in a Bill drafted as this has been, but the idea is precisely identical.
I think not.
Question put: That the word proposed to be deleted stand part.
The Committee divided: Tá, 66; Níl, 37.
Tá
- Aird, William P.
- Alton, Ernest Henry.
- Bennett, George Cecil.
- Blythe, Ernest.
- Bourke, Séamus A.
- Brodrick, Seán.
- Byrne, John Joseph.
- Carey, Edmund.
- Cole, John James.
- Collins-O'Driscoll, Mrs. Margt.
- Conlon, Martin.
- Connolly, Michael P.
- Cosgrave, William T.
- Daly, John.
- Hennessy, Thomas.
- Hennigan, John.
- Henry, Mark.
- Hogan, Patrick (Galway).
- Holohan, Richard.
- Jordan, Michael.
- Keogh, Myles.
- Law, Hugh Alexander.
- Leonard, Patrick.
- Lynch, Finian.
- Mathews, Arthur Patrick.
- McDonogh, Martin.
- McFadden, Michael Og.
- McGilligan, Patrick.
- Mongan, Joseph W.
- Mulcahy, Richard.
- Murphy, James E.
- Murphy, Joseph Xavier.
- O'Connell, Richard.
- Davis, Michael.
- Doherty, Eugene.
- Doyle, Peadar Seán.
- Duggan, Edmund John.
- Dwyer, James.
- Esmonde, Osmond Thos. Grattan.
- Finlay, Thomas A.
- Fitzgerald, Desmond.
- Fitzgerald-Kenney, James.
- Gorey, Denis J.
- Haslett, Alexander.
- Hassett, John J.
- Heffernan, Michael R.
- Hennessy, Michael Joseph.
- O'Connor, Bartholomew.
- O'Donovan, Timothy Joseph.
- O'Higgins, Thomas.
- O'Leary, Daniel.
- O'Mahony, The.
- O'Reilly, John J.
- O'Sullivan, Gearóid.
- O'Sullivan, John Marcus.
- Reynolds, Patrick.
- Rice, Vincent.
- Roddy, Martin.
- Sheehy, Timothy (West Cork).
- Thrift, William Edward.
- Tierney, Michael.
- Vaughan, Daniel.
- White, John.
- White, Vincent Joseph.
- Wolfe, George.
- Wolfe, Jasper Travers.
Níl
- Anthony, Richard.
- Boland, Gerald.
- Boland, Patrick.
- Briscoe, Robert.
- Carty, Frank.
- Clery, Michael.
- Colbert, James.
- Corkery, Dan.
- Corry, Martin John.
- Crowley, Tadhg.
- Davin, William.
- Derrig, Thomas.
- De Valera, Eamon.
- Fogarty, Andrew.
- Geoghegan, James.
- Gorry, Patrick J.
- Hayes, Seán.
- Jordan, Stephen.
- Kent, William R.
- Killilea, Mark.
- Kilroy, Michael.
- Lemass, Seán F.
- Little, Patrick John.
- McEllistrim, Thomas.
- MacEntee, Seán.
- Moore, Séamus.
- Mullins, Thomas.
- Murphy, Timothy Joseph.
- O'Connell, Thomas J.
- O'Kelly, Seán T.
- O'Reilly, Matthew.
- Ruttledge, Patrick J.
- Ryan, James.
- Sexton, Martin.
- Sheehy, Timothy (Tipp.).
- Walsh, Richard.
- Ward, Francis C.
Tellers: Tá, Deputies Duggan and P. S. Doyle; Níl, Deputies G. Boland and Briscoe.
Question declared carried.
Section 21 agreed to.
SECTION 22.
I move amendment 59:
To add at the end of sub-section (2) the following paragraph:—
"or
(d) where the tenancy is deemed by this Act to terminate immediately after the passing of this Act, within one month after the passing of this Act."
The necessity for the amendment arises because under sub-section (2) of the section notice to claim relief shall be served in the case of a tenancy terminated by notice to quit by not more than one month after the service of such notice; in the case of a tenancy terminated by the expiration of a term of years, not less than three months before the termination of the tenancy, and in the case of a tenancy terminated by the fall of a life on that event happening. There is no provision made for the case of the person added to the Bill by a previous amendment who holds on under the provisions of the Increase of Rent and Mortgage Act. The term in this amendment is within one month after the passing of the Act. I would like to have the views of the House on that period, because since the amendment was drafted it has occurred to me that possibly the term one month is too short. I fancy that the provisions of this Act will become fairly widely known, but they may not be known to everybody in the country who might like to take advantage of them, and in consequence I am rather inclined to alter the period of one month to six months. It is my intention to bring in a further amendment to make that alteration.
I agree to the alteration if it can be made now.
I accordingly move that the amendment be altered by inserting "six months" instead of "one month."
Does the Minister not think that that is leaving the matter rather long in doubt?
I do not, because if you tie people down to one month there will be a rush after the passing of the Act. I think you must give a reasonably long period so that the provisions of the Act may become known.
I agree.
If the Bill becomes law, as I hope it will, that will occur before the Long Vacation. If you confine this to one month that would occur in the holiday period of the year when solicitors' offices are not working full time. I really think that six months are necessary.
I agree that one month is a bit short but you are leaving an important matter hanging in suspense for a half year. I would say that three months would be more suitable.
Acting-Chairman
Is the Minister taking amendment 60 and amendment 82 with this—they seem to be closely related?
We will come to 82 in due course.
Amendment 60 falls.
Amendment 60 by leave withdrawn.
Amendment 59 as altered agreed to.
Section 22 as amended agreed to.
SECTION 23.
(1) A person who has duly served a notice of intention to claim relief may, at any time not less than one month after the service of such notice, apply to the Court to determine his right to such relief and (as the case may be) to fix the amount of the compensation or the terms of the new tenancy to which he is found to be entitled.
I move amendment 61, which reads:—
In sub-section (1) line 60, to delete the words "one month" and substitute the words "three months."
This is the same point that we had over and over again already.
Acting-Chairman
In another connection.
We came to rather a compromise on that question between 1 and 3 before. On that question we will keep up the compromising spirit and make it 2.
Amendment as altered agreed to.
Section 23 as amended agreed to.
SECTION 24.
(1) Where an application is made under this Act to the Court to determine the right of the person (in this section referred to as the applicant) making the application for relief under this Act the following provisions shall have effect, that is to say:—
(a) where the applicant claims compensation for improvements as original relief, the applicant shall lodge in the Circuit Court Office with the originating notice of motion or other originating document an improvement statement.
(c) every improvement statement lodged in a Circuit Court Office in pursuance of this sub-section shall be in the prescribed form and shall state the prescribed particulars of the improvement or each of the several improvements in respect of which compensation for improvements is claimed.
(5) The Court, in fixing the amount of the said compensation for improvements, shall be bound by the several estimates and statements contained in the said valuation unless the Court shall, for reasons stated in the order of the Court, declare the said valuation to be erroneous in law or fact.
I move amendment 62, which reads:—
In sub-section (1) (a), line 13, after the word "statement" to add the words "and shall at the same time serve a copy of the same upon the landlord."
This amendment, I think, is only seeking to place everybody in possession of the facts that are necessary. I think it is only fair and reasonable that the landlord should be in possession of the full facts about him and so give him an opportunity of checking the statements made. That would be really necessary if this Bill is to be worked properly.
If the Deputy would look into my amendment 63 (a) I think he will find that it covers what is in the Deputy's amendment, and it goes further still.
I think 63 (a) covers it.
Amendment 62, by leave, withdrawn.
I move amendment 63, which reads:—
In sub-section (1) (c), line 25, to insert after the word "particulars" the words "which shall include the items of the cost."
If 63 (a) were made quite clear to include the items of the cost I would be satisfied. I think the word should be made quite specifically clear so as to include that point. It is just to get an answer from the Minister that I move this amendment.
I do not think this amendment would be necessary; it would be rather more one of prescribing the form which would be prescribed under the Act if it were thought necessary that it should be given. I think it is rather more a matter for the Rules.
The Minister thinks it might be brought under the Rules?
If it would be putting further trouble on the tenant to include the items of the cost of the improvements, and if the Minister is satisfied, I will not press it.
It is not the cost of the improvements, but the increased letting value they create, and the insertion of the items of cost would only confuse the judgment of the Court.
Amendment, by leave, withdrawn.
I move amendment 63 (a), which reads:
In sub-section (1) to add at the end of the sub-section a new paragraph as follows:—
"(d) whenever an applicant is required by this sub-section to lodge in the Circuit Court Office an improvement statement, such applicant shall, either before or within three days after such lodgment, furnish a copy of such improvement statement to the landlord or superior landlord from whom such compensation is claimed."
Well, of course I think it is only just and really fair that the claim should be served on the other side.
Amendment agreed to.
I move amendment 64, which reads:
In sub-section (5), line 60, to delete the words "be bound by" and substitute the words "have regard to."
I think the words used in the sub-section are too restrictive on the judgment of the Court, and I suggest these modifying words in lieu of the very restrictive words used in the sub-section.
There is a difference between this sub-section and the other rather similar subsections to which the Deputy is referring. These will be Section 28 (5) and also Section 44 (5). There is this difference, that under Section 24 (5) it is obligatory upon the Court to refer to the Valuation Office, whereas under the other two sections it is only "may" or "if so requested shall." That makes, I think, a considerable difference between this and the other amendments here. The Valuation Office is brought in as a matter of necessity. Their report is to be binding.
In other words, the real thing is that we want to keep all appeals to the Court as limited as we possibly can. If the parties on this question of valuation and improvement come to the conclusion that unless there has been some very great mistake made by the Valuation Department, they will simply take the Valuation Department as being final, it will save a tremendous amount of going to the Courts. That is the reason why we have made it so much more definite here than elsewhere. Claims under this improvement section of the Bill or this part of the Bill dealing with improvements will be more numerous than any other claims, and both in the interests of the parties themselves that they may not have to spend very large sums in litigation, and also, to a lesser extent that the Courts may not be clogged by a huge amount of litigation, it is desirable that the Valuation Commissioners' report should be made as nearly binding as possible upon the parties. That is the reason why we made the differentiation between this and other sections.
I appreciate that. All the same I do not think that the Minister is correct in saying that the use of these words "be bound by" is necessary to avoid this litigation. Some loophole may remain. So far as the decision of the Valuation Department is concerned the insertion of the words "have regard to" would leave it just as before. It is more the form of the words, taking out of the Court its decision, and saying in effect that the valuator is to be the court.
I think the Minister might use the same words as are used in other subsections to which reference has been made. If there is any mistake in law or in fact, then you can make use of the loophole left by the words "have regard to." When coming to a decision, the Court, in fixing the amount of the compensation for improvements, would have regard to the figures given by the valuator.
I will consider the matter.
Amendment, by leave, withdrawn.
I beg to move amendment 65:
In sub-section (5), line 61, to delete all words after the word "valuation" to the end of the sub-section and substitute the words "and the several estimates and statements submitted by any interested parties: Provided that in no case shall the compensation awarded by the court exceed the amount expended by the tenant upon the improvements in respect of which compensation is claimed."
I think the Minister will admit that this is a fair and necessary proviso. It simply puts in specifically that the tenant is not to recover more for compensation for improvements than the actual amount he has expended. I do not think anybody would suggest that the tenant ought to make a profit out of these improvements. If the major limit of compensation awarded is the actual sum that he has expended, he cannot complain that he is being treated unfairly.
I wonder does Deputy Thrift realise that this might cut the other way? In the earlier portion of the Bill I suggested that the tenant should get at least the amount he expended on his improvements.
That is a very different story.
Mr. O'Connell
It is, of course, but the landlord should not be allowed to make a profit.
Why should there be any limitation? Is not the tenant entitled to compensation for the increased letting value? Why should the landlord and not the tenant get the benefit of the improvements? If the landlord has to pay the increased letting value consequent upon the tenant's improvements, he is not subjected to any hardship and the tenant is merely getting what he is entitled to get. We must take into account the cost of building and how the value of money fluctuates. The tenant who effected improvements in 1913, which increased the letting value of the premises, might find the amount of compensation to-day would be a very poor return for what he expended in 1913, even though the actual amount is the same, measured in cash. The main point is that there is an increased letting value now if the tenant vacates, and there is a considerable difference in regard to the money value now as compared with 1913.
That argument lost its value and met with very little success when it was urged in the interest of the landlord. The very same case as the Deputy has now submitted might just as well apply to the landlord, who has to meet the fluctuations in the money market just as well as the tenant. Surely Deputy Lemass does not suggest it is just that the tenant should be allowed to make a profit out of what does not belong to him? He expends money on repairs. All this proviso suggests is that at most he should not get more than he has actually expended. If that is not accepted, then something unfair is being sought. The suggestion is that the tenant should get back all his money; he would have the advantage of the improvements during the time he was in occupation and he would not lose a penny. I do not think that that could be considered fair.
Why should the landlord get the benefit? The increased letting value is not the result of the landlord's action. It is the result of the tenant's efforts and the landlord should not have any claim to it.
If the tenant conceives these improvements and has had the enterprise to go to the trouble of carrying them out and expending money upon them, he is surely entitled to some compensation for all he has done.
I think the increased letting value is the test that you must take, and, just as I thought the amount which the tenant had expended should not be the measure of damages, as Deputy O'Connell pointed out when I opposed the amendment proposed by him a few days ago, I equally think that what he receives in compensation should not be limited to the actual amount which he has expended. Look at it from the landlord's point of view. He gets a certain increased letting value, and that is what he has to pay for. It really does not matter twopence to the landlord what it cost the tenant. The tenant may have done the work very expeditiously and cheaply, and may get actually more than he has paid, but I think that is very unlikely. The tenant will in most cases get less than he has expended, because he will have enjoyed, for a considerable period of time in most instances, the improvements which he has made.
Look at it from another point of view. Suppose this was an improvement which would add very considerably to the letting value of the premises; in other words, the tenant thinks that by making this improvement he is adding very considerably to the letting value of the house and is making a very good investment of his money. Under this Bill it is always open to the landlord to come in and say: "I will make those improvements myself." He may think that here is an improvement, the cost of making which will be comparatively small, while the resultant advantage to the property will be very large. In that case he may decide to carry out the improvements himself. He always has got his option. I do not think I could accept the proposal now submitted.
He may decide to make the improvements if he has the necessary capital, but suppose he has not that capital?
I am sure that in those circumstances he would be able to get the capital. If he has not the capital and cannot carry out the improvements, he is very fortunate to have a tenant who has the necessary capital and who will improve his premises for him. I do not think he can complain if he is not in a position to improve the premises and he has a tenant who is prepared to improve them. I do not think he can complain if the tenant adds to the letting value of the premises.
I should hope that it is a contingency that will very rarely arise.
Amendment 65, by leave, withdrawn.
Section 24, as amended, agreed to.
SECTION 25
(d) where the Court makes an order under this section for the grant to a tenant of a new tenancy in a tenement, the landlord of such tenement shall be bound to grant and such tenant shall be bound to accept a lease or other written contract of tenancy creating in such tenement, as from the expiration of the previous tenancy therein, a new tenancy on the terms specified in such order, and if any dispute, failure or question arises or occurs in the carrying out of such order any party concerned may apply to the Court and thereupon the Court may make such order as justice may require.
I beg to move amendment 66:
To insert before paragraph (d) a new paragraph as follows:
(d) if the Court finds that such tenant is not entitled to such new tenancy and the notice of the intention to claim relief on which the application is grounded does not include a claim in the alternative for compensation under this Act, the Court shall nevertheless consider whether compensation should be awarded and if it decides to award such compensation shall fix the amount thereof.
I think the wording of this amendment is somewhat faulty, in so far as it does not make it clear that it is intended to apply only to those entitled to compensation under Section 20 (2). The idea is to provide that if a tenant of a business premises is entitled to a new tenancy or, in the alternative, compensation for disturbance, but through error or otherwise applies to the Court for a new tenancy, he should not be debarred from getting compensation for disturbance if the Court decides against him on the question of the new tenancy. I think that some such amendment is necessary in view of the provisions of paragraph (e) of this section.
I had, as a matter of fact, practically ready before the Committee Stage an amendment dealing with this matter. I was late to insert it for the Committee Stage. It would have delayed the Committee Stage. It was an amendment on the lines giving the Court power to amend the application where it thinks it would be just. It is my intention to propose such an amendment on the Report Stage.
Amendment, by leave, withdrawn.
Section 25, as amended, agreed to.
SECTION 26.
(1) Where a tenant has served on his landlord a notice of intention to claim relief which is limited to relief by way of compensation for improvements and such landlord has either a fee simple reversion or a reversion of more than five years in the tenement to which such notice relates, such landlord may, within one month after the service of such notice on him, serve on such tenant a notice in the prescribed form offering to such tenant either (as such landlord shall think proper to specify in such notice) a new tenancy in such tenement on terms specified in such notice or a new tenancy in such tenement on terms to be fixed by the Court.
(2) Where a landlord serves on his tenant a notice under the foregoing sub-section of this section offering to such tenant a new tenancy on terms specified in such notice, the following provisions shall have effect, that is to say:—
(a) the tenant may, within one week after the service of such notice, serve on such landlord a notice in the prescribed form accepting such new tenancy;
(b) if the tenant serves a notice under the foregoing paragraph of this sub-section, such landlord shall forthwith grant and such tenant shall forthwith——
I move amendment 67:—
In sub-section (1), line 48, to delete the words "one month" and substitute the words "three months."
The same point here arises as before.
Amendment put and agreed to.
I move amendment 68:—
In sub-section (2) (a), line 58, to delete the word "week" and substitute the word "month."
This is again lengthening the period. I looked to both sides, and I agree with Deputy Lemass.
I think it would be a pity to break up such a happy combination. I agree also.
Amendment agreed to.
Section 26, as amended, agreed to.
SECTION 27.
Where the Court fixes under this Act the terms of a new tenancy, whether such new tenancy is to be granted in pursuance of a provision of this Act or in pursuance of an order of the Court, the following provisions shall have effect, that is to say:—
(a) the Court shall fix the duration of such new tenancy;
(b) where the landlord holds the tenement in which such new tenancy is created under a lease, the duration of such new tenancy shall not exceed the term of such lease;
(c) the duration of such new tenancy shall not in any case exceed a term of ninety-nine years;
(d) the rent payable by the tenant under such new tenancy shall not be less than (as the case may require) the rent payable by the landlord in respect of such tenement or such proportion of the rent payable by the landlord in respect of such tenement and other property as is in the opinion of the Court fairly apportionable to such tenement;
(e) subject to the foregoing paragraph of this sub-section, the said rent shall be the difference between the gross rent and the allowance for improvements as hereinafter respectively defined;
(f) the gross rent shall be the rent which in the opinion of the Court a willing lessee not already in occupation would give and a willing lessor would take for such tenement, in each case on the basis of vacant possession being given, and in circumstances of normal competition, and having regard to the other terms of such tenancy and to the letting values in circumstances of normal competition of tenements of a similar character to and situate in the vicinity of such tenement, but without regard to any goodwill which may exist in respect of such tenement;
(g) the allowance in respect of improvements shall be such proportion of the gross rent as is, in the opinion of the Court, attributable to improvements made by the tenant or his predecessors in title and in respect of which the tenant would have been entitled to compensation for improvements if (as the case may be) Part III of this Act did not apply to such tenement or such new tenancy had not been created;
(h) the Court may, as one of the terms of such new tenancy, require the intended tenant to expend a specified sum of money in the execution of specified repairs (including painting and decorating) to such tenement and authorise the postponement of the granting of such new tenancy until such repairs have been duly completed.
Mr. O'Connell
I move amendment 69:—
In paragraph (c), line 65, after the word "years" to insert the words "and subject to the provisions of paragraph (b) of this section without the consent of the tenant shall not be less than fifty years."
This is the section where the Court fixes the term of the new tenancy, and it has been represented to me that in addition to fixing the upper limit, the maximum period, there ought to be a minimum period as well, subject, of course, to the provision set out in sub-section (b). The suggestion is that the figure which I have put down here of fifty years ought to be the minimum period.
I have given considerable thought to this amendment of Deputy O'Connell's, because it is perfectly plain to me that a practical minimum would be a very great advantage to the landlord, and it is not as plain to me that it might be of equal advantage to the tenant. If a landlord is going to have a fair rent fixed in respect of these premises, it is obviously very much to his advantage that the term should be long rather than it should be short, that he would have a tenant there fixed for a very considerable time, and my difficulty is rather that from the tenant's point of view, if there is a minimum fixed, though the tenant may say "I do not want it for this length of time," the landlord will come along and say you will have to take it for that length of time. You will probably find when the duration of a term is being fixed in Court that the tenant is more often anxious not to be burdened with the house for a tremendously long term rather than that the landlord is not anxious to have his house let for a very long term. It may be that the tenant may consent to the term being less than fifty years. Unless he so consented, it must be, but it does not say, and I do not think it can be fairly made to say, that it shall be only such term as the tenant wishes. I am inclined to accept, subject to an alteration, this amendment. I do so with just some little hesitation; it may work out a little bit hard on tenants in practice.
Mr. O'Connell
I was asked by representative tenants to put down this amendment. I take it that they considered the thing.
I accept the principle.
Is the Minister accepting amendment 69.
Subject to re-drafting. I will bring in an amendment to meet amendment 69.
May one ask that the Minister would so frame his amendment that the tenant will have the option of seeking a term of fifty years. I think that probably that is the real intention. Certainly that is what many tenants would like to have. There might be cases in which it would be inconvenient for a tenant to be burdened with a term of fifty years.
That is one of the difficulties that was running through my mind in the drafting of this, because if you fix a term of fifty years you visualise that at least fifty years is to be the normal and it would be very difficult indeed to draft it so that the term shall be only for such term as the tenant would like. There are two people who would have to be considered. As I say I am willing to accept this, but it can only be that the duration of a new tenancy, without the consent of the tenant, shall not be less than fifty years; possibly on rare occasions the landlord may force the term on him.
I understood that Deputy O'Connell, the mover of the amendment, indicated that he would be satisfied if the clause were so amended that the tenant would have the right to demand a term of fifty years if he so elected, but that it cannot be thrust upon him.
Amendment, by leave, withdrawn.
Amendments 70, 71, 72, 73, 74 and 75 all raise one question and might be discussed at the same time. That is the question of the definition of a fair rent. I do not know which amendment the House wishes to discuss. Number 70 is not the one.
Acting-Chairman
71 seems to be the one.
I do not know that it is.
Acting-Chairman
If 71 falls, 72, 73 and 74 will fall.
72 has no connection with 71.
Acting-Chairman
It is a case of 74 or 75.
We can discuss on 70 the general definition of fair rent. I move amendment 70, "to delete paragraph (e)." This section again raises one of the main principles of the Bill.
With regard to paragraphs (f) and (g), the question of whether or not that is a fair basis upon which to calculate the rent to be paid by a tenant who is deemed by the Dáil to have a statutory right to a new tenancy is the issue before us. It is proposed that a tenant who has been in occupation of a dwelling-house for forty years, or who has been in occupation of a business house and established a goodwill in the business in that house for three years, or who has doubled the letting value of the dwelling in consequence of his own improvements, should be given a new tenancy only on this condition, that he would agree to pay the landlord the rent which that landlord would get on the basis of taking possession in the circumstances of normal competition—in other words, the full competitive rent of the dwelling or shop, as the case may be. Is it fair that such a tenant, possessing such an equity to a new tenancy, should be required to pay the full competitive rent, and, if not, what rent should he be asked to pay? There are various proposals on the Paper before us. There is a proposal in the name of Deputy O'Connell that if the building was let in 1914 the rent payable should be the rent actually paid in that year.
Mr. O'Connell
No.
The Deputy's amendment is: "In respect to houses built prior to the 4th of August, 1914, shall not be more than the rent permitted by the Increase of Rent and Mortgage Interest (Restrictions) Act, 1923, and in respect to houses built after the 4th of August, 1914." There are other proposals in the name of Deputy Byrne, and there is an amendment to this definition in the name of the Minister. We considered this question most carefully. We were attracted originally by the proposal which Deputy O'Connell is submitting, that is, in respect of houses which were let on the 4th of August, 1914, the rent should be the rent now permitted under the Increase of Rent Act. The big difficulty in that connection is, however, in the first place it omits from the scope of the Bill a large number of houses which have been constructed since the 4th of August, 1914, and, secondly, that this Bill, unlike the Increase of Rent Act, is a permanent measure, and it seems very undesirable to have the circumstances of 1914 as a standard in a Bill which may be in operation in ten or twenty years' time in circumstances that we cannot possibly foresee. The view which we took was that some method of computation of the rent should be arrived at which would be easily operated and applicable in all circumstances. We could say that the rent to be reserved under the new tenancy should not exceed the rent to be reserved under the old tenancy. But that also would leave out of account certain important factors. The letting value of the tenancy might have gone down considerably, or, alternatively, it might have gone up in consequence of action by the tenant, by the landlord, or by the local authority. In the majority of cases which are likely to arise in the immediate future, it will be found that the rent as defined in paragraph (f) of this section is likely to exceed the rent reserved under the old tenancy, particularly, of course, if that old rent be regulated by the Increase of Rent Acts. The question is whether the difference between the new increased letting value and the old rent should go to the tenant or to the landlord. We may say that the rent shall be the rent under the Increase of Rent Act or under any circumstances shall be the old rent. In fact, we are giving to the tenant the full benefit of the increase in the letting value that has taken place.
[An Ceann Comhairle resumed the Chair.]
If, on the other hand, we say, as the Minister proposes we should say, that the landlord is entitled to get the full competitive rent of the building, we mean that the full benefit of that increased letting value is to go to the landlord as against the tenant. The proposal which we are submitting to the Dáil is in the nature of a compromise, a proposal that in effect the difference should be divided between the landlord and the tenant. That difference may, as I have said, be due neither to the action of the landlord nor the tenant. It may be due to a variety of causes, not the least of which might be the expenditure and enterprise of the local authority in the area. If there were a local council which carried out considerable improvement schemes in the neighbourhood of the dwelling, which installed a water supply, sewerage and other services of that kind, the increase in the letting value of the dwelling should properly go to the persons who paid for those improvements—that is the ratepayers in the area. We considered very carefully whether it could not be possible to devise some means by which that increased letting value could be secured for the ratepayers, but we found ourselves up against considerable difficulties, difficulties in which any Party in opposition must find themselves when attempting to frame intricate amendments to a Bill of this kind. We could not do it. So we arrive at this proposal—that the increase in the letting value should be divided as between the landlord and the tenant in the proportion of fifty-fifty. Where it is found that the gross rent, as calculated in accordance with the provisions of paragraph (f), exceeds the old rent, then the rent to be reserved under the new tenancy shall not be in excess of the old rent by more than half the difference between the gross rent as calculated in accordance with paragraph (f) and the old rent. On the other hand, where it is found that the gross rent, as calculated in accordance with paragraph (f), is less than the old rent, we propose that the new rent should be the rent as it is calculated. There is another proposal to split the difference. In that case, when the letting value of the premises has decreased, we do not propose that the tenant should be asked to pay more than its letting value. I move to report progress.
The Dáil went out of Committee.
Progress reported. The Committee to sit again to-morrow.