Amendments Nos. 1 and 2 to be taken together.
Committee on Finance. - Landlord and Tenant (Amendment) Bill, 1971 [Seanad]: Committee Stage.
Section 1 agreed to.
SECTION 2.
(Cavan): I move amendment No. 1:
In subsection (2) (a), page 2, line 34, after "years," to add "or".
Subsection (2) reads:
(2) The following are the conditions to be complied with:
(a) that—
(i) the land is held for the purpose of carrying on the sport under a lease for a term of not less than twenty-one years,
(ii) the land has been continuously occupied by the sports club for that purpose for the period of not less than twenty-one years immediately preceding the date of the application for a sporting lease, or
As I read the section as it stands both those provisions have to be complied with, subject, of course, to what the Minister will say. I, and some people who are interested in this Bill, believe it should be sufficient if the land is held for the purpose of carrying on the sport under a lease for a term of not less than 21 years, or if the land has been continuously occupied by the sports club for that purpose for the period of not less than 21 years immediately preceding the date of the application for a sporting lease. I suggest the word "or" should be inserted between (i) and (ii). The same applies in relation to (2) (b) which deals with the spending of money and sets out that the club shall have spent money:
(i) on erecting permanent buildings or structures on the land which are used in connection with the land for that purpose,
(ii) on reconstructing, altering, renovating or adapting any permanent buildings or structures on the land which are so used so as to render them more suitable for that purpose.
I suggest it should be sufficient if the club have spent money on the erecting of permanent buildings or structures on the land which are used in connection with the land for purposes of sport or on reconstructing, altering, renovating or adapting any permanent existing buildings on the land. Again I invite the Minister to agree to the insertion of "or" between (b) (i) and (ii). If he does so it will considerably improve the section and the Bill generally. I should be glad to have the Minister's views on this.
In my view the amendments are unnecessary. I have had the matter discussed with the parliamentary draftsmen who are satisfied that the insertion of the word "or" between subparagraph (i) and (ii) of paragraph 2 (2) (a) is not required. I am advised that subparagraphs (i), (ii) and (iii) must be read as alternative to one another. Apart from the fact that it is good drafting to have it as it is it is good grammar to have it as it is because if one refers to an alternative of three and says one must pick A, B or C, one does not say one should pick A or B or C. There is no doubt whatever that (i), (ii) and (iii) in section 2 are alternative and if one comes under any one of them one qualifies so far as that part of it is concerned.
(Cavan): I gather the Minister is assuring me that subsection (2) is to be read as if “or” were there and that subsections (i), (ii) and (iii) are alternatives?
Yes.
(Cavan): I put down this amendment because a practitioner of many years standing, who is actively associated with a golf club, feared that as the Bill was drafted the golf club would have to comply with both (i) and (ii). There would have to be a lease and the land would have to be continuously occupied as a sports club, but the Minister is now assuring me that this is not so and that (i), (ii) and (iii) are alternatives.
That is right.
(Cavan): Does the same thing apply in respect of (b) (i) and (ii)?
That is amendment No. 2, is it?
(Cavan): Yes.
It does, yes.
(Cavan): Is the Minister satisfied that it is sufficient for the club to spend the stipulated amount of money in erecting new buildings or reconstructing existing buildings?
Yes.
(Cavan): Is the Minister satisfied on the advice given to him that this is the true meaning of the words?
Yes.
(Cavan): If I was satisfied about that and my correspondent was satisfied about it, then I would not press the amendment.
In fact, the Deputy will see in Bills where there are as many as eight alternatives in a section, the the word "or" only appears before the last of the alternatives. That is correct from a grammatical and drafting point of view.
(Cavan): I will accept the Minister's assurance.
Amendment, by leave, withdrawn.
Amendment No. 2 not moved.
(Cavan): I move amendment No. 3:
In page 3, to delete subsection (2) (c), lines 15 to 23, and substitute the following:—
"(c) that the total amount so spent was not less than one thousand pounds."
I think we have something of substance here and I should like the Minister to give it serious consideration. In order to qualify for a sporting lease the sports club must satisfy the court that it has spent money on erecting permanent buildings or reconstructing existing buildings or developing, improving or adapting the land. Subsection (2) (c) states:
that the total amount so spent was not less than the greater of the following, namely, one thousand pounds or fifteen times the average yearly amount of any rent or other sum paid or payable in respect of the land in the five years immediately preceding the date of the application for a sporting lease, disregarding any penal rent or other sum payable for any breach of a covenant, condition or agreement and any exceptional rent or sum in respect of a specified period not exceeding five years.
In the case I have been given I am told that in order to qualify for a sporting lease the club in question will have to prove that it had spent £7,500 under these various headings. The probability is that it has, indeed, spent £7,500 or much more but the difficulty is to prove that because no records are available, no books have been kept. This money has been spent over a period but they are very fearful that it may not be possible to prove to the satisfaction of the court that 15 times the rent has been spent on these provisions.
This type of argument has been made to me and I think it is quite reasonable. There is no provision in the Bill for ascertaining the monetary value of money spent. It is suggested that a clause be inserted in the Bill that where accounts are not available the value of the work done in the case of a dispute between the landlord and the club should be referred to an arbitrator, in the case of a golf club to a golf architect or to some person who would have expert knowledge of the cost and the present value of the work done, otherwise the landlord and the tenant might be arguing for years about the matter. In the meantime the club would not have the sporting lease which would encourage them to improve the course and the amenities as they would not know whether they would eventually succeed in getting the sporting lease.
Also, if the present cost of constructing a golf course was taken into account it would run into the region of £1,000 as a whole. In order to get over that I have put down an amendment saying that where the club can satisfy the court that it has spent £1,000 on this type of improvement that it should qualify for a sporting lease. The argument has been put to me, and I think it is quite reasonable, that most of these clubs are run in an informal sort of way. The improvements are made generally over a number of years as money is available and as the necessity arises. If the Minister cannot see his way to accept my simple way of dealing with this by providing that an expenditure of £1,000 should be adequate, then the matter should be referred to arbitration and the arbitrator should be a person with technical knowledge as otherwise you would have wrangling going on in the court for ages with the landlord naturally anxious to obstruct the granting of the sporting lease.
The Minister realises that landlords will not be anxious to grant these sporting leases and for that very reason he has introduced this Bill. I should like to have the Minister's views on that because I think there is a point of substance here. I was not so confident about the first two amendments because I felt the Minister would put forward the argument that he did which I accept but here I think that we have a point which will be difficult to get over. A sum in the region of £7,500 is only £500 a year but is not a sum which is too easy to prove especially with a club which is run in the way most of these sporting clubs are run. I shall be glad to hear the Minister's views on this.
I would not be inclined to accept the amendment. The recommendation of the Landlord and Tenant Commission in their second report, paragraph 79 (2) (e), was that the investment of the club in buildings or in land should not be less than 15 times the yearly rent. An additional requirement that this expenditure should be at least £1,000 was inserted in order to ensure that only clubs with a genuine stake in the land would benefit under the provisions of the Bill. This was so because many clubs hold under a very nominal rent indeed.
Apart from this and apart from provisions of a purely technical nature, section 2, subsection (2) (c), of the Bill reflects the recommendation of the commission concerning the amount of investment that the club should be required to show. I feel also there is no need for an evidential provision of the type suggested by Deputy Fitzpatrick. A club which is in difficulty in proving from its own accounts that it fulfils the expenditure requirement can always produce a golf architect or some other suitable expert in the court to give an expert opinion as to the actual expenditure. That opinion would, of course, be acceptable to the court in the absence of rebutting evidence from some other expert.
The point I want to make is that it is not essential that a club should be able to produce old ledgers or something of that nature with actual figures in it. I should point out, too, that the number of cases where the required figure would be in excess of £1,000 would not be all that great. The figure of £7,500 mentioned by Deputy Fitzpatrick would be a fairly substantial amount and would be much more than many of these clubs would pay. Am I correct in thinking this would be a rent of approximately £500 per year?
(Cavan): I think so.
Very few clubs in this kind of situation would pay that kind of rent. So far as one can see, many of them pay nominal rents of £50, £70 and £80 so that the figure of £1,000 will be the operative figure for many of them.
(Cavan): The reference to £1,000 in the section is the best argument in favour of my amendment. The Minister has stated that the commission were of opinion that before a club should be entitled to a new lease they should make a worthwhile investment in the land, in erecting buildings, reconstructing old premises or developing the land. They went on to set out their idea of a substantial investment and, according to the Minister, that investment has been spelled out at £1,000.
No, the Deputy may have misunderstood me. The commission recommended 15 times the annual rent but in order to put a minimum figure on it I inserted the figure of £1,000. The commission may have overlooked the fact that there would be clubs with very nominal rents and it would scarcely be fair to give them a lease on the basis of having spent only a few hundred pounds.
(Cavan): I am sorry for having misunderstood the Minister but it does not weaken my argument because the Minister has measured what he considers to be a substantial and worthwhile investment and he puts that investment at £1,000. I would be agreeable to accept that as a figure below which a club would not be entitled to a sporting lease; in other words, the club would not be entitled to a sporting lease if they had not spent at least £1,000. However, I should like the Minister to come along with me and say that if they could satisfy the court they had spent £1,000 they would qualify under this heading. I was speaking from a brief given to me in respect of Castlerea Golf Club— at least my informant is from Castlerea and I assume the golf club is in that locality. As names have been menmise tioned here, I consider I am at liberty to mention that. These people are of the opinion they will be in difficulty if 15 times the rent is written into the Bill. If the Minister has agreed to accept £1,000, why not let that amount be the ceiling? Why provide that they must have expended the greater of the two alternatives, namely, £1,000 or 15 times the rent? If the Minister had accepted completely the commission's recommendations of 15 times the rent I could understand his reasoning, but if he is satisfied with £1,000——
Only as a minimum.
(Cavan): Why have an alternative with a much higher ceiling? The Minister should reconsider this point.
The £1,000 would come into operation only if it is more than 15 times the rent. Even if I had not mentioned the figure of £1,000, the Deputy's friends in Castlerea would be caught because they would still have to pay £7,500.
(Cavan): That is what I am advised. However, the Minister should not make fish of one and flesh of another. He should accept, as a principle, that anyone who spends £1,000 should qualify. What the Minister is saying here is that some will qualify at £1,000 and other people might not qualify unless they spend £7,500. This is a serious point and it has been raised by a club who think they have a practical difficulty and one they will have to face if the Bill is not amended. I do not think the Minister would weaken the Bill or take from it in any way if he were to accept this amendment.
Deputy Fitzpatrick should bear in mind that not all clubs are the same either in the activities they undertake or in the size and value of the lands they occupy. For example, if a club some 20 or 25 years ago rented one acre of land and paid a small rent for it—perhaps £25 a year —and then developed it in some way, that club should not be put on the same level as a golf club, for example, who might have 100 or 150 acres. It would be unfair to impose the same expenditure requirement on a small place of one acre as on a place with a large membership and an area of 100 acres. The reason the minimum figure was put in was to ensure that in cases where there was a purely nominal rent, unless there was some reasonable development in the small areas involved, it would be unfair to the owner to impose on him liability for this kind of lease. From the owner's point of view a lease for 99 years is an onerous type of lease. Therefore, we should bear in mind the distinction between different types of property and we should not seek, as this amendment does, to impose the same requirement regarding expenditure on both the very large and the small type of property.
(Cavan): The Minister will appreciate that some of the sporting clubs we are dealing with have been in existence for 60 years and that money has been expended on them from time to time and some of the labour might be voluntary. When we come to discuss the expenditure of money we should not forget that actual cash might not have been spent as much of the work could have been done by members without payment or reward. For that reason it will be difficult for the clubs to prove that they expended this amount of money. I know the Minister has said that this might be a matter of evidence, that some architect would inspect the course and say he believed so much money had been expended. Let us suppose that expenditure took place 30 or 40 years ago. I think the Minister will agree that £1,000 in those days would do a great amount of work and reconstruction and especially if a voluntary effort were thrown into it it might be very difficult, if not impossible, to prove, in the case of a long standing club where the work was done, as I say, 40 or 50 years ago, that this sort of money running into thousands of pounds had been spent on it. I know the Minister and the Government are well intentioned in introducing this Bill, that they are introducing it to get over a difficulty which has arisen in recent years by the expanding of towns and cities and because of the demand for land. However, if the Minister is merely going to create litigation between sporting clubs and landlords, he will not have achieved the object he set out to achieve. As I say, this club is worried about that. I think £1,000 expenditure is substantial.
It is for a small club, but not for a big one, and it would be unfair on the owner.
(Cavan): The idea is to give a lease where the land has been in the use of a club for 21 years. That is really the test and that should influence the Minister more than the amount of money expended. I know we are, unfortunately, dealing with this Bill in reverse from the Seanad, but if he is not prepared to accept my amendment I would invite him to provide some arbitration machinery in the Bill.
Amendment put and declared lost.
Section 2 agreed to.
SECTION 3.
Question proposed: "That section 3 stand part of the Bill."
(Cavan): Section 3 (2) reads:
The notice shall be valid only if served not earlier than three months before the expiration of the lease.
Would the Minister tell me what notice is referred to there?
This provision reflects the corresponding provision in sections 11 (2) and 12 (2) of the Act of 1958 as amended by section 25 (1) of the Act of 1967. This subsection provides that where a sports club holds under a lease its immediate lessor or any superior lessor may not serve a valid notice of the expiration of the lease earlier than three months before the expiration of the lease. It also means that where a club holds under a lease of any kind or is in possession of its lands under an expired lease without having made any new arrangement with the landlord, the club has the right to apply for a sporting lease under subsection (1) and that this right to apply for a sporting lease survives until three months after a notice of expiration of the lease is served by the landlord. In line with the provisions of the Act of 1958 no particular form of notice of expiration of the lease is being prescribed.
Question put and agreed to.
Sections 4 and 5 agreed to.
SECTION 6.
(Cavan): I move amendment No. 4:
In subsection (2), page 5, after "interest" in line 50, to add "and the financial position of the sports club applying for the lease and its members".
Section 6 provides the machinery for fixing the rent in default of agreement. In default of agreement on the rent between the lessor and the sports club, the court shall fix a fair rent for the grant of a lease of the property for the purpose of carrying on the sport. Then subsection (2) goes on to set the guidelines to be taken into account by the court in fixing the rent. Subsection (2) reads:
In fixing the rent the court shall have regard to the general intention of this Act in relation to sports clubs which is the advancement of outdoor sports, games and recreations and the preservation of open spaces for the common good and, without prejudice to such other considerations as it considers relevant, may take into account the rent or other sum previously paid for the property by the sports club and any covenants and conditions under which it was so paid, to the rent paid by other sports clubs of the same kind in the same or a comparable locality, to the contribution made by the sports club to the enhancement of the property, and to price paid by any person who is a necessary party to the granting of the lease in the acquisition of his estate or interest.
I would submit broadly that all those guidelines are weighed in favour of the club, that the court is to take into account and to have regard to the fact that the sports club is advancing outdoor sports, games and recreations and the preservation of open spaces for the common good, and all these other things. The argument the Minister has just made against my last amendment is, I think, valid against the Minister here. It might be reasonable that a sports club not in a very affluent financial state should get a lease at a reasonable rent but that an affluent sports club, whose members are people of financial standing, should have to pay nearer the market rent. Therefore, I put down this amendment which provides that, in addition to all the other guidelines set out there, the court shall also have regard to the financial position of the sports club applying for the lease and of its members. That will cut both ways. It is only one of the factors that the court will be obliged to take into account if the Minister accepts my amendment.
It will mean that the court could take into account that they were a struggling club doing their best to provide these amenities in an area where they did not exist and in which there was not a very big population. On the other hand, the court could take into account the fact that it might be a club with a huge membership of comparatively wealthy people who could, without undue burden to themselves, contribute to the rent by paying a small increase in their subscriptions. That is the argument that I am putting forward. Unless the Minister accepts this amendment the section is weighted in favour of the club entirely and it asks the court to bear in mind that the sports club are public benefactors because they are providing amenities for sport in an area. This also leads to the preservation of open spaces. My suggestion to the Minister is not an entirely new one. This has been provided for in the Rent Restrictions Act, 1960, as amended by the Rent Restrictions Act, 1967, and as will be amended by this Bill. There is provision for the court to take into consideration the financial circumstances of the landlord and of the tenant. There is not any valid argument against this amendment. If the section read that the court should fix a fair rent for the grant of the lease of the property for the purpose of carrying on sport, there might not be any necessity for this amendment, but it is not left at that. The court is not instructed to fix a fair rent. The court is instructed:
(2) In fixing the rent the court shall have regard to the general intention of this Act in relation to sports clubs which is the advancement of outdoor sports, games and recreations and the preservation of open spaces for the common good and, without prejudice to such other considerations as it considers relevant, may take into account the rent or other sum previously paid for the property by the sports club....
That might not be very helpful. The subsection further reads:
and any covenants and conditions under which it was so paid, to the rent paid by other sports clubs of the same kind....
It would be difficult enough to get comparisons there. By and large, there will only be one in each area—very often in each county—and they will not be comparable. The subsection continues:
in the same or a comparable locality, to the contribution made by the sports club to the enhancement of the property, and to the price paid by any person who is a necessary party to the granting of the lease in the acquisition of his estate or interest.
I am quite agreeable to that plan, that the price paid to any person should be taken into account. There could be a case of a person buying the lessor's interest for a small sum and coming in to exploit it and to get a big rent. That is a valid guideline. I also think my suggestion is reasonable and even necessary having regard to the stipulations. It is only reasonable that sports clubs should be entitled to sufficient land for their requirements. Land and houses are very different. Land is a very valuable commodity at the moment. It would be unreasonable in a case where there was a wealthy sports club and a comparatively poor lessor or landlord that the landlord should be obliged, as this section in my opinion would oblige him, to subsidise sport in a locality and to subsidise well-off people to enable them to enjoy themselves. My suggestion would not harm the section, but rather would do it a lot of good.
I feel that this amendment is not necessary because the section already allows the court in fixing the rent, to take account of:
such other considerations as it considers relevant.
That phrase is wide enough to cover any of the factors referred to by Deputy Fitzpatrick. If in the case of any particular club it or its members are well-off financially it is open to the landlord to argue this consideration before the court. The further defect in the amendment is that it seeks to take into account the financial position of the club applying for its lease and of its members. As it reads there appear to be two separate concepts—the club's own finances and the financial position of the persons who comprise the membership. I cannot envisage a situation being welcomed by the members of a club in which they will be called into court and asked about their income and their general financial circumstances. The main point is that all the factors mentioned by Deputy Fitzpatrick are covered in the subsection as it stands. An owner can make these points if they are relevant to him. The court must take them into account.
(Cavan): It appears to me that the considerations which the court must take into consideration in ease of the club are written out in black and white. It is said that without prejudice to such other considerations as it considers relevant the courts may take these things into account. A court in interpreting the section would come to the conclusion that the overriding consideration was the benefit that the club was conferring on the locality. That is a fair summary of the impression a judge would get on reading this section. He would get the impression that the important thing he should take into account was the benefit being conferred on the local community and the area in which the club is by the existence of that club. That is unreasonable. If we put in considerations in favour of the lease we should also put in reasonable considerations that should be taken into account on behalf of the lessor. I do not believe that a landlord should exploit the local community by being able to charge a prohibitive or black market rent, or a rent that he might get because of the scarcity of land for the purpose of sports clubs, but I believe that where a club are in reasonably affluent circumstances they should pay a reasonable rent.
I do not mind if the Minister redrafts the amendment because amendments put down by the Opposition are not always as competently drafted as those put down by the Government or as Bills introduced by the Government because the Minister and the Government in general have at their disposal draftsmen of many years experience who do nothing else but draft Bills and amendments. Even they produce Bills from time to time which, when they become Acts, give rise to long and learned consideration and argument in the courts.
If the Minister were to accept my amendment in principle he is quite welcome to tell me he will have it redrafted, as he did in the case of an amendment which will appear later, and have it reintroduced on Report Stage. I feel very strongly that a judge interpreting this section as it stands will find himself being invited to lean over backwards in favour of the club and I fear that a landlord going into court has the dice loaded against him in this section. If it were finally left "the court shall fix a fair rent", the judge would decide what is a fair rent and take into consideration such matters as he thought fit. My objection here is that the judge is told he must take into consideration certain matters which in my opinion are loaded in favour of the lessee and against the lessor.
I strongly urge, therefore, that the Minister should have another look at this. It is legislation which, I concede, is long overdue. I also concede that if it were not introduced at this time many sports clubs in the country would find themselves ejected from their lands which would then be built on. It was pointed out during Second Stage that there is the danger in the Dublin area where there are three racecourses, Leopardstown, Baldoyle and the Phoenix Park, that we would end up with only two and possibly we could end up with only the one controlled by the Racing Board.
As I have said, I am prepared to agree with the Minister that this legislation is necessary, but I think that when the Minister says we had to introduce legislation of this sort for the compelling reasons I have just mentioned, he should be very careful to see that it is fair to all the people who will be affected by it, particularly when he invites the courts to fix a rent and when he provides guidelines for the courts—that the guidelines should weigh evenly as between both sides. My objection, which I hope I have put fairly clearly, is that this subsection does not do just that. Indeed, it does the opposite because the other party is not adequately covered by such an omnibus phrase as "without prejudice to such other considerations as it (the court) considers relevant". Judges are human and I think any judge would be right if he said: "I have to take the section in its entirety and to read it as it stands. The impression I get from the section is that the benefit being conferred on the community by the club is the overriding factor that I am to take into consideration."
That is why, when I first read the Bill, I thought there was something lacking and I set out to amend it by providing that the court be invited to take into consideration the financial circumstances of the club involved. Indeed, I would go a little further. If the Minister is concerned with that I would agree that we could invite the court also to take into consideration the financial circumstances of the owner of the land and if he happened to be an exceptionally wealthy man it might have a bearing also. If the Minister would like to add to the amendment "and the financial circumstances of the club concerned and of the owner of the land" I would be satisfied. We would then be fair to both sides.
This is not something new. If the Minister refers to section 8 of the Rent Restrictions Act, 1960, he will find that his predecessor and the Landlord and Tenant Commission wrote in similar terms and spelled it out in black and white. I am not too clear whether this Bill has to go back to the Seanad —if it originated here it would have to come back to us——
It has to go back.
(Cavan): At any rate, we have a Report Stage and if the Minister were to say that he will consider this between now and Report Stage or that he will consider it in the Seanad, I will be satisfied.
Notice taken that 20 Members were not present; House counted and 20 Members being present,
I have listened to what Deputy Fitzpatrick had to say and he had really nothing to add to what he said in his opening speech on the amendment. I could not accept the amendment in principle. I still feel it is unnecessary. Everything he says should be taken into account can be taken into account. I find it difficult to reconcile his proposals in this amendment with his proposal in the previous amendment which in fact was the direct opposite because he sought there to impose one figure on all clubs. No matter how rich or how poor or what their circumstances might be, he sought to impose a figure of £1,000 in this amendment. If a club happens to be particularly wealthy that fact is a relevant matter and a matter which can be brought to the attention of the court by those appearing for the lessor. I have no doubt they would do that and would be failing in their duty if they did not do it and the court will accordingly take that into account.
Apart from whatever defects there may be in the amendment as drafted I still could not agree to it in principle. I do not think it is either necessary or desirable.
Amendment put and declared lost.
Section 6 agreed to.
Sections 7 and 8 agreed to.
SECTION 9.
I move amendment No. 5:
Before section 9 to insert a new section as follows:—
"(a) Any tenant holding on a lease under fifty years shall be entitled to purchase the freehold, notwithstanding anything in any enactments.
(b) Any tenant whose ground rent is greater than the Poor Law Valuation of the property shall be entitled to purchase the freehold."
All these amendments are designed to remedy a situation that has given rise to a good deal of difficulty for a number of tenants on the Proby Estate, which was the subject of a reference by the Minister in introducing the Bill and also of some remarks I made on the Second Stage. At this stage it is probably only necessary to recapitulate some of the principal facts in the situation.
During the time when the Rents and Leaseholds Commission, presided over by Judge Conroy, was considering the situation and preparing the report on which the earlier Acts were drafted, the Proby Estate took action against certain tenants whose leases fell in and as a result—some of the leases were short-term; others had a longer term —a number of tenants were compelled, because of the circumstances, to take out new leases. This exercise of force majeure resulted in the tenants concerned being obliged to pay varying sums but in one or two cases considerable sums. This arose due to a defect in the 1958 Act which when it came to light was the subject of consideration by the Conroy Commission. While the Commision was actually sitting the leases fell in and as a result some tenants had to accept very onerous terms.
The difficulty about the present amending legislation is that it does not cover some of these cases, and for a simple reason. The Minister's proposed amendments in section 8 and 9 specify certain periods. In one case the period is five years. This means, if the section is enacted as now phrased, that the five-year period would exclude some existing tenants and it was suggested by them, and I have endeavoured to draft amendments to cover it, that the period be extended to eight years. As the Bill is drafted, the leases will expire and, because the Bill goes back only for a period of five years, the tenants do not qualify. The other defect is that any tenant whose ground rent is greater than the poor law valuation will not qualify for the purchase of the freehold under the proposed amendment. Some tenants, as the Minister can understand and as was clearly shown to the Conroy Commission, are in a peculiarly difficult position because at the time when their leases fell in some of them at very considerable cost, resulting in a few cases in very great hardship to themselves and their families, were obliged to come to terms with the landlord.
In other cases when this matter was brought before the Conroy Commission —in one specific case it was ventilated on four separate occasions—ejectment proceedings against tenants were taken by the estate. Eventually, the estate gave an undertaking to the commission not to issue eviction proceedings against any tenant until the amendment was drafted and implemented. Prior to that undertaking being given the tenants whose leases had expired were under threat of eviction and they accepted short term leases at exorbitant rents. People who previously had leases of less than 50 years, in some cases leases of 21 years, and in others long leases at small ground rents, will now be denied the right of renewal or the right to purchase because of the circumstances in which they were granted renewals previously. These should have been covered by the 1958 Act but they were not so covered, although the Rent and Leasehold Commission published advertisements at the time. Apparently, in certain cases the advertisements were not seen by the people and there was a great deal of delay in having the case presented to the commission. The commission had completed their work in respect of some aspects before the matter was brought to notice. Therefore, I urge the Minister to consider the amendment. I appreciate that, as the Minister said on Second Stage, there are certain aspects that might present difficulties, but the particular proposals involved in these amendments are not designed to widen the situation but are designed solely to giving the same rights to a few excluded tenants as others will have after this Bill is enacted.
The fact that steps were taken to force certain people to enter into agreements and that subsequently, when the matter had been ventilated before both the courts and the Rent and Leasehold Commission, an undertaking had been given not to proceed until after the amending legislation was introduced, indicated that the landlord and his advisers realised that what they were trying to do was unjust and was so regarded by the commission. Again, I urge the Minister to accept the amendment which is designed to cover particular cases and to give the same rights to those who are affected and who are not covered as to those who will be covered because of the time at which the leases expire.
I support strongly this amendment, the adoption of which would finally bring to a close the disgraceful position in respect of the tenants of the Proby Estate. The amendment would give general coverage and would remedy the very serious injustices to which the tenants have been subjected.
We in the Labour Party welcomed the latest report of the Conroy Commission and we were glad that they advocated the repeal of subsection (c) of section 10 of the 1958 Act. This subsection disqualified the building leases on the Proby Estate and deprived tenants of their rights to purchase the freehold at the well-known 14 times their ground rent. These tenants were deprived also of their right to arbitration under subsection (1) of section 18 of the 1967 Act. It must be placed on record again that while the Conroy Commission were preparing their recommendations on the 1967 Act—this is the nub of the problem in many ways—Mr. Peter Proby, that well-known Irishman from Eton, issued ejection proceedings against the tenants holding on their expired leases but they refused his demands for full market value of the house, the price of freehold or about £240 per year ground rent for a 21year lease.
The issuing of ejectment proceedings in some cases brought the threat of eviction on almost every tenant on the estate whose lease had expired or was about to expire. The result of this was that under this particularly odious form of duress about 80 per cent of the tenants settled for exorbitant rents, and, as we are aware, the report now embodied in legislation states that any tenant who settled is deprived of the benefits of the proposed amendments. This shows a complete disregard for the plight of tenants who sought redress in the courts but who were forced to settle on the landlord's terms. This is no Irish phenomenon in terms of property relationships. They were forced to settle on the estate's terms so that they would have a roof over their heads; but, having done so, they are deprived of the general benefits of the law of the land.
The Minister advances two reasons as to why he is not prepared to give coverage to the remaining Proby Estate tenants. He says that in principle he is opposed to retrospective legislation. I remember spending many a weary hour in this House, in the total absence of the Fianna Fáil trade union group, trying to persuade the Minister for Labour to allow retrospection on the Redundancy Payments Act. Again, in principle, the Minister concerned told us he could not possibly agree to retrospection. However, within six months he gave us substantial retrospection on that legislation. The amendments proposed by Deputy Cosgrave and supported by us would meet the wishes of the Proby Estate Tenants' Association and more particularly the wishes of those who are badly done by. It has been the best part of seven years since the majority of Proby leases expired. Unfortunately, the period recommended by the Minister is only five years. There is nothing sacrosanct about five years and the Minister could accept the amendment. No great loss would accrue to the Proby Estate as such.
Any tenant with a lease under 50 years does not qualify for the purchase of freehold under the proposed amendment. That position should be remedied. Any tenant whose ground rent is greater than his valuation does not qualify for the purchase of freehold under the proposed amendment. On these scores a good many of the tenants of the Proby Estate are disqualified. Specific instances have been given to the Minister. Like Deputy Cosgrave on Second Stage I have no desire to name any tenant. This is an issue of principle. However, there have been cases of hardship. I know of two cases which could be fully vouched for. The information is in the hands of the Minister and he has the opportunity of redressing the situation.
Tenants whose leases expired in or around 1965 and whose leases were for a term of over 50 years, with ground rent less than their valuation and who had to accept the new short leases at exorbitant ground rents under threat of eviction, should be granted the right to purchase freehold. I do not think such tenants should be the victims of legislation which has been a long time coming before this House, which is welcomed, and which has been handled very competently by the Minister, if I may say so as a non-lawyer. I am glad he has brought in this legislation and I am glad that he is not as obdurate as his predecessor, Deputy Ó Moráin, was in relation to representations we made. Deputy Ó Moráin somehow or other got a bee in his bonnet when we raised this matter and I remember him assuring us here before he was retired that the Fianna Fáil Party had a record which no party could ever hope to touch if they lived for 1,000 years, in dealing with ground rents and landlords. Now is the opportunity for the Fianna Fáil Party to put their principles—if one might use the crude political term—where their attitudes of republicanism have been, because when one considers the Proby Estate one must put on record in relation to this amendment that this is an 800acre estate of the rack-renting successors—the Probys being the successors—to the Earl of Carysfort including their particular rack-tenting, accumulative, very questionable ownership of lands in the Dalkey area, parts of Sandycove, in Dún Laoghaire, into Blackrock and right up to where I live in Stillorgan. Their ownership of the land in that area and the leases they have on it, which they have tenaciously held on to, was ironically defended by the former Minister and the present Minister, to my surprise, says that constitutionally he is obliged to defend it. Coming from a Fianna Fáil Minister I find that rather hard to stomach. I have before me the endorsement of claim issued to one of the tenants. I think it is relevant to this amendment. It is the plaintiff's claim for possession. This is one of the tenants who was obliged to fix up. He fixed up under duress. The case is that of Peter Proby and Mr. Boland. It says:
The plaintiff's claim for possession of the lands of all that part of the lands of Sandycove with the house and premises thereon known as No. —Ballygihen Ave., Dún Laoghaire in the Barony of Rathdown and County of Dublin, lately held by the Defendant as tenant to the Plaintiff under an indenture of lease made 1st day of Dec. 1905 between the Right Honourable William, Earl of Carysfort of the one part and Michael Doyle of the other part——
In effect the few remaining leases where grave injustice has been done seem to be defended by the Minister under this piece of legislation. The Minister has said that where a tenant made a contract he cannot break the contract. The point is, if I may point it out to a party who signed a treaty apparently under grave duress in the history of this State, these tenants had no option but to sign the contracts or have the roofs removed from over their heads. Having entered into renewals under duress I do not think the Minister should be unduly worried about the constitutional rights of the Probys, of the family who have questionably inherited this extensive piece of property. They have not done too badly. I recall that in 1968 or thereabouts for well over £500,000 they sold 4½ acres in the South City Market estate to a London property speculator. They can hardly cry that they are in urgent need of a few shillings from the tenants of the Proby area.
The Minister should accept the amendment and in good republican style take another look at the individual cases involved. It would be interesting to see the boys travelling over from Eton to the Supreme Court to defend the constitutionality of how they came into possession of this piece of property in the first instance. It might be an interesting piece of election propaganda for the Minister in the west of Ireland.
The sympathy one would feel with tenants of the Proby Estate and that would be engendered in one either by one's own knowledge of the circumstances or by what Deputy Cosgrave said tonight, becomes very rapidly whittled away when one has to listen to the sort of contribution we have just had. It is a pity it is not possible to discuss even a technical matter like this without having that type of speech aimed at the gallery and aimed elsewhere, which betrays a complete ignorance of what is involved in the Bill and in the amendment but seeks to make a point at somebody's expense.
I was somewhat taken aback when I read Deputy Cosgrave's amendment for the first time last night because the two proposals in this amendment are the direct opposite of the recommendations of the commission; in other words they recommend the very things that the commission recommended should not be done. Where the commission recommended a lease of 50 years or more Deputy Cosgrave proposes 50 years or less. Similarly with regard to the question of ground rent and PLV. The amendment says:
Any tenant holding on a lease under fifty years shall be entitled to purchase the freehold, notwithstanding anything in any enactments.
The meaning of that is that any tenant, therefore, holding under any sort of instrument for any period of time, even as short as a week, would become entitled to buy out the freehold. I do not think Deputy Cosgrave intended that but I am afraid that would be a consequence. Similarly in regard to paragraph (b) of amendment No. 5, which says:
Any tenant whose ground rent is greater than the Poor Law Valuation of the property shall be entitled to purchase the freehold.
That means a very great many. It does not cover the sort of situation envisaged by the commission where a sort of informal definition or extralegal definition of ground rent was achieved whereby a rent is a ground rent if it is less than the PLV. Strictly speaking, there is no such thing at law as a ground rent. They are all rents. But, by usage, a sort of small rent on a property that is held for a very long time became known as a ground rent and I think it has evolved in recent years that it is generally known as a ground rent if it is less than the PLV and, of course, it is in the vast majority of cases of this type. In Dublin a house held under a long lease, say, 999 years, might have a PLV of £30 and a ground rent of £20 or thereabouts. The effect, therefore, of (b) would be really almost the same as (a), that it would give any tenant who pays more in rent than the valuation of his property the right to purchase the freehold and in my view that would be practically every tenant, including, of course, weekly tenants, because if you rent, for example, a small shop at £5 a week, that would be £260 a year. The valuation of that small shop might be £10, possibly £15; the rent would clearly exceed the valuation.
I do not think, therefore, that Deputy Cosgrave could have intended this sort of consequence because it would mean that practically every piece of property in Ireland that is occupied by a tenant, whether weekly, monthly, or yearly, or held on a 999 year lease, could be compulsorily bought out under the Ground Rents Act, 1967, for 13 times the annual rent or thereabouts and I do not think that that was envisaged.
I cannot accept the figure that was somewhat wildly given by Deputy Desmond, that up to 80 per cent of the Proby tenants were forced to settle with the estate. This is not so. In fact, the figure is probably between nine and 12. Some of them have not come forward to make any fuss about it but I understand the figure lies between nine and 12.
Deputy Cosgrave made what I might call a general speech that would cover really more than one amendment but the type of amendment he wants in order to cover that sort of person is, he will agree, not just on, for very obvious reasons. I looked at this thing as sympathetically as I could because, as well as having heard from Deputy Cosgrave on it, I have heard a number of times from Deputy Andrews about the problems suffered by these people. I am afraid that the best I can do is to say that, while the present amendment before us is valueless and, in fact, would have incredible implications, I could accept and do propose to accept the next one. I think the one after that was put down by Deputy Cosgrave on the understanding that it might be consequential on the one before but, for reasons I will explain, in fact, it is not; it is a separate matter. By accepting amendment No. 6, I may get some of these people—there are not many of them—out of their difficulty and without running into the more obvious dangers of trying to set aside executed contracts.
It has been pointed out to me by Deputy Andrews and by others that, because this report came out some time in 1968 and a five-year period was recommended in respect of that, a lot of people thought the five years ran back from there and they did not understand, because not many people understand much about this sort of law, that it would of course have to run back from the enactment of the Bill and, in order to preserve what they thought was their position, it would not be any great injustice to anyone to add the three years and make the "five""eight". I will accept that and will get some of the people out of their difficulty but I know Deputy Cosgrave will agree with me that some are gone beyond salvation in the sense that unless one sets aside the whole concept of contract and executed contract, one could not do anything for the very small remaining number, probably under nine.
I appreciate what the Minister has said. In fact, I think it was he himself who made the point earlier, on some amendment or section, that the "or" applies only at the end. In fact, what I was endeavouring to do, at comparatively short notice and with somewhat inadequate legal briefing, as distinct from briefing about the facts, was to design amendments that would ensure that I would achieve what would result in preserving the position of those tenants who were adversely affected.
I appreciate fully that amendment No. 5 as drafted is wider than anything that probably would be necessary, but it was put down in order to cover the situation and to enable the whole question to be discussed, because there is here the problem that the Minister adverted to at the end of his remarks: that this report when it was produced was understood and accepted by a number of the tenants concerned to apply from the date of its presentation or furnishing. There is an added difficulty in at least two cases, the case that was referred to, of Mr. Boland, and the case of a Mr. Pentony who is an elderly person. It so happens that almost all the tenants in this case are fairly advanced in years but in Mr. Boland's case he is a married man with a young family. In those two cases they were obliged to settle because of the time at which their leases fell in. The Minister will appreciate that difficulties arose here, in respect of reversionary leases and in respect of building leases. A great difficulty arose because it was impossible to prove, and I think it was accepted all round that there was no proof, that the landlord or his predecessor in title built the houses in question. In fact, many years ago a leaseholders' organisation that covered a good part of the Proby Estate dealt with this because different parts of the estate had houses erected on it by different builders at different times. The Proby Estate is a very vast one. It covers lands in Sandycove, Dalkey, Dún Laoghaire, on to Bray and back down to Stillorgan. Most of the Bray end of it was developed at a much later period. The particular portion with which we are concerned was developed at an earlier period and the substitution of eight for five would possibly cover most of those involved.
I accept Deputy Fitzpatrick's view that the draftsman available to the Minister may be in a better position to frame an amendment to cover the cases in question without broadening the section to such an extent as to include those who could not justifiably be included and without extending the objectives we seek to achieve in these amendments.
I would make a further plea to the Minister in respect of the cases pinpointed by Deputy Cosgrave and referred to earlier by me. I do not think anyone can deny that these particular contracts were signed. The Minister may sneer at "Deputy Desmond's legal expertise" but no political party can claim to be extra-constitutional. The Minister comes in here and says he is advised that any such exercise by him would run into serious constitutional difficulty. Where, I should like to know, in my total ignorance, would constitutional difficulty arise for the Minister? Why is he not prepared to test it or allow those who would test it to do so? Why not find out how anxious they are to expose themselves to public odium? A grave injustice is being perpetrated on both Mr. Patrick Boland and Mr. Vincent Pentony the two outstanding cases which will not be covered by substituting eight for five years. Their case has been well documented. They were unfortunate enough to give in to the Proby Estate and now the Minister washes his hands of them. Contracts were executed but the Minister knows the circumstances under which they were executed. He should be able to draft an appropriate amendment to relieve their position. I do not think this is as complicated as the Minister thinks. Lawyers are too ready to assume complications where none exist. Even if there are complications there is no reason why they should not be overcome. I would strongly urge the Minister to consider the amendment. All we seek to do is to ameliorate the position of these tenants. I make no apology to anyone for seeking full redress for them. This has gone on long enough and it is time the Minister exercised his power and authority in respect of these tenants.
(Cavan): I do not intend to argue in depth or in detail the problems of the Proby Estate tenants, but it is clear to me that some of these tenants were forced into the unfortunate position of having to come to terms and sign contracts at a time when a change in the law in their favour was under consideration, when the commission were sitting and when, I think, legislation was actually being drafted. There is a real hardship. If there is any way out, then the Minister should resolve the problem once and for all. This has been simmering for a long time and agitation has gone on over a number of years. The Minister has backdated the Bill to the date when the Government announcement was made last year in order to avoid anyone jumping the gun or taking an unfair advantage of the sports clubs.
The Minister has gone a considerable distance to solving the problem by accepting Deputy Cosgrave's amendment increasing the period from five years to eight years. This is welcome. It is a good thing but it will be frustrating to those who will now be excluded. The number will be few but these are the people who feel they have a real grievance and suffered a grave injustice. If it was evident, as it probably was, that the law was about to be changed at the time when these people were forced to sign these contracts in order to retain their houses, then I would not have much sympathy for the landlords who reaped this unfair bonanza. A case can be made, I think, for retrospective legislation here.
Deputy Cosgrave's amendments— he freely admits it—were put down to enable him to argue the case. He has argued the case admirably and the amendments are a move in the right direction. Many of the landlords involved purchased the houses 50 or 70 years ago for paltry sums, hundreds of pounds. They have not since spent one brass farthing on them. They never occupied them. They now find themselves, as the law stands, entitled to charge a rent of more per year than they originally paid for the houses.
That is unreasonable. With all due respects to the Conroy Commission it is running more or less in favour of those people and is accepting that market rents should be payable to landlords on the expiration of the leases although those landlords, as I say, purchased these houses 50, 70 and 80 years ago for little or nothing and have never spent a penny on them since. This is like striking gold as far as landlords are concerned.
I made a suggestion the other day that leases should be renewed on the basis of reversionary leases on a charge of a sixth or an eighth of the market rent. Maybe I went too far in stipulating a sixth or an eighth, perhaps the landlord should reap some reasonable benefit by way of an increase in the rents, but the rents should not be increased by 500 or 600 per cent as is the case at the moment.
Some of these landlords engaged in property speculation. They bought these tenanted dwellings ten or 12 years ago for little or nothing in the knowledge that the leases would be falling in and they could cash in on the falling of the lease and charge a very high rent. That is an anti-national and anti-social approach to the landlord and tenant code. I hope the Minister will have a general look at the type of case I have in mind. The case of the landlord who has owned a property for 60 or 80 years is bad enough but even worse is the case of somebody seeing leases with ten years to run and buying them over the heads of the tenants and then when the leases expire going to court and getting fancy rents fixed.
I am glad to see that in the particular measure we are dealing with —I do not know whether it is for the first time or not, but it is certainly a move in the right direction—section 6 stipulates that one of the considerations which the court should be able to take into account in fixing the rent is the price paid by the landlord for the property. I would invite the Minister and the Conroy Commission to write that into future legislation because it will prevent exploitation of tenants or speculation in tenanted property, I do not think that is too strong an expression. By "speculation in tenanted property" I mean purchasing tenanted property whether it is tenanted for the purpose of a residence or the purpose of a business in the knowledge that leases are shortly to expire and then going to court and having the rent considerably increased by 300, 400, 500 and 600 per cent.
The Minister has shown considerable sympathy for these Proby Estate tenants. I hope he will tidy up the whole mess and ensure that justice is done to these tenants. He may have this difficult problem of interfering with binding contracts and creating a precedent, but if an examination shows that these contracts were executed under duress at a time when both the landlord and the tenant knew that the law was in the process of being changed in favour of the tenant, but where the tenant in order to retain possession had no option but to accept the landlord's terms, the Minister could probably make a case for an exceptional amendment or exceptional legislation.
Amendment, by leave, withdrawn.
Amendments Nos. 6 and 7 may be taken together.
I move amendment No. 6:
In page 6, line 11, to delete "five" and substitute "eight".
I believe the Minister has agreed to accept this amendment.
I have agreed I will accept amendment No. 6 but amendment No. 7 is not, in fact, consequential on No. 6. I felt Deputy Cosgrave may have put it down as a possible consequential amendment.
That is why I put it down.
They are two different topics. I am not saying that they should not be discussed together but the acceptance of one does not entail the acceptance of the other.
I wanted to make sure it covered any case affected by the other. The Minister is familiar with what happens in these cases. This applied to a limited number of cases because of the time at which the leases under which they held expired. The 1958 Act did not cover them; the Conroy Commission were sitting and prior to the commission's report a number of these tenants had to come to terms. Because of the fight that was put up by a small number of people— the two who were put in a very serious position were Mr. Boland and Mr. Pentony—the Proby Estate gave an undertaking to the commission that no ejection proceedings would be taken or that any proceedings would be held pending the enactment of the amending legislation. Because of the delay in getting it drafted time has gone by. The Minister has agreed to the substitution of eight years for five years and I think that amendment will cover all these cases. This is the proposal that has been put to me by the tenants concerned. I only hope it covers all of the cases with the exception of a couple of them. In any event, I presume it covers them now. I was anxious to ensure that the same rights would apply in respect of some others because there is a difficulty.
The position of some of these leases was raised at the commission. There is doubt that they were building leases. There is certainly a doubt as to who built them, whether it was the landlord or his predecessor in title, and that complicates the matter. There is some obscurity about the particular legal rights and certainly at one stage some of the tenants had difficulty in getting adequate documentary evidence of title. It is for that reason that I included this in the second amendment but if the Minister is satisfied that it is not necessary and is so advised I am prepared to accept that. There is no doubt that some of these tenants had considerable difficulty in getting evidence of title and I was anxious to ensure that their rights are preserved but it may not be necessary.
Section 9 is designed to extend the benefits of the 1958 Act to persons whose leases expired some years ago and whether it is five or eight years before the Bill becomes law is irrelevant to the immediate context of the amendment. Under the 1958 Act unless a person applies for a reversionary lease up to 15 years before his qualifying lease expires, and this is the significance of the reference to 15 years in section 9 of this Bill, the period of 15 years is not related in any way to the period of retrospection for which section 9 provides.
Amendment agreed to.
Amendment No. 7 not moved.
Section 9, as amended, agreed to.
SECTION 10.
Perhaps amendments Nos. 8 and 9 could be discussed together as amendment No. 8 links Deputy Fitzpatrick's amendment in part.
I move amendment No. 8:
In page 6, before section 10, to insert the following section:
"(1) Section 4 (3) of the Rent Restrictions (Amendment) Act, 1967, which provides a time-limit for applications under section 8 of the Rent Restrictions Act, 1960, shall, in so far as it affects applications under subsection (1A) (inserted by section 4 (1) of the Rent Restrictions (Amendment) Act, 1967) of the said section 8, have effect as if for `two years from the passing of this Act' there were substituted `one year from the passing of the Landlord and Tenant (Amendment) Act, 1971'.
(2) A rent determined under section 8 (1A) of the Rent Restrictions Act, 1960, shall be payable with effect from the date of the determination."
The purpose of this amendment is to revive for a period of one year the spent provisions contained in section 8 (1A) of the Rent Restrictions Act, 1960. Subsection (1A) was inserted in section 8 of the 1960 Act by section 4 (1) of the Rent Restrictions (Amendment) Act, 1967, and in accordance with section 4 (3) of the 1967 Act it had a life of only two years which expired on 8th May, 1969. This amendment will enable what may be described as small landlords to have certain basic rents revised during the period of one year from the date of the enactment of this Bill into law.
Under the provisions of section 8 (1A) of the 1960 Rent Act, which this amendment proposes to revive, the District Court will be authorised to review the basic rent on an application by a landlord who owns not more than six controlled houses or self-contained flats with a combined valuation not exceeding £60, in case one at least of them is situated in the Dublin area, or £40, in any other case. The landlord will be liable for the tenant's costs in the District Court, unless that court considers it proper, having regard in particular to the means of the landlord and the tenant, to order otherwise. The rent, if adjusted by the court, is to be of such amount as the court considers reasonable having regard to all the circumstances of the case, but, in particular, to the necessity of avoiding financial hardship to the tenant and the landlord. It is not to exceed the maximum rent which would be fixed on the renewal of the tenancy under Part III of the Landlord and Tenant Act, 1931. Only a landlord who owned the premises on 8th June, 1966, that is the date of introduction of the Bill that was enacted into law as the 1967 Rent Act, will benefit from the reactivation of section 8 (1A). The court will be enabled to deal privately with the whole or any part of an application under the revived provision. The parties may also agree among themselves on a new basic rent. The court may, however, alter a rent so agreed, on the application of either party within three months after the service of notice of the agreed rent, where it is established that he has become aware since the agreement that the financial circumstances of the other party at the time of the agreement were substantially better than those by reference to which the agreement was reached. The reactivation for a period of one year of the spent provisions contained in section 8 (1A) of the Rent Restrictions Act, 1960, will give those small landlords who satisfy the necessary conditions and who are in poor financial circumstances another opportunity to have basic rents revised. Representations have been made to my Department to the effect that many small landlords who would have benefited under the provisions of section 8 (1A) during the two year period when it was in operation failed to do so because they were unaware of its existence.
(Cavan): As the Minister has said, this provision of the 1967 Act enabled small landlords to have their rents adjusted up to 9th May, 1969. Unfortunately many of the landlords did not appreciate their position and did not move to avail of this section until it expired. If I might say so at this stage this section is a desirable type of section for a number of reasons. It directs the court to take into consideration the circumstances of the tenants and the circumstances of the landlord. It specifies that unless the landlord held the house on a date in 1966 he cannot avail of this section, in other words, people cannot come in, buy houses and then move to have the rent adjusted under this.
There are, indeed, some landlords who will benefit considerably by the Minister's action in extending the time for availing of this particular section. On the Second Stage I drew the Minister's attention to the fact that the Bill as then drafted did not deal with section 4 (3) of the Rent Restrictions (Amendment) Act, 1967, and I pointed out that I understood representations had been made to him from many quarters. The Minister felt in a difficulty then because he felt this was a Landlord and Tenant Bill whereas the problem with which I was urging him to deal was a rent restrictions problem. I told the Minister I would put down an amendment and I have done so, the effect of which would be more or less the same as that of the Minister's amendment. It might give two years instead of one from the passage of this Bill to apply to the court but I think one year will be sufficient.
I want to thank the Minister for getting over that procedural difficulty which might have been presented to him and for disregarding the fact that this amendment might be more appropriately dealt with in another Bill but in a Bill which may not come before us for a number of years. The Minister has shown himself to be big enough in this respect to say that this amendment should be made in this Bill, whether it is technically the right place to make it or not.
As I pointed out on Second Stage he had the precedent in that the Bill dealt with one rent restrictions matter in section 10. The Minister's amendment completely meets the point of my amendment. I would like to think that I prompted the Minister to put down this amendment but in saying that I am not saying it in any begrudging way. When what was wrong was drawn to the Minister's attention he remedied the flaw in the previous Act, or at least extended the time for availing of the provisions of the previous Act. I thank the Minister for doing so and I shall withdraw amendment No.9 on the House accepting amendment No.8.
Amendment agreed to.
Amendment No. 9 not moved.
I move amendment No. 10:
Before section 10 to insert a new section as follows:
"Any tenant who held under a twenty-one year lease prior to the enactment of this Act, and who previously held under a long lease, shall now be entitled to purchase the freehold, or be entitled to a renewal on the terms of the original lease."
The purpose of this amendment is to cover cases like some of those we have been discussing. The Minister is aware that there were a number of cases— in particular there were two—which were the subject of action by the landlord and where the tenants had to take renewals of leases on onerous terms. Their difficulty arose because of a defect in the 1958 Act and the fact that the 1967 Act had not been enacted when the leases in question expired in 1965.
This amendment is designed to cover cases where leases expired at that time and which were for a term of more than 50 years and regarded as long leases. They had ground rents, or rents as the Minister described as less than the poor law valuation and, because of the circumstances, they had to accept new short leases at exorbitant ground rents under threat of eviction. As was said here on a number of times, because of action taken by a few and the attendant publicity, and the fact that the matter was brought before the commission and in some cases before the courts, no further action was taken in respect of other tenants or was not taken in the terms of the amended legislation.
I am anxious that the tenants in question either be granted the right to purchase the freehold or be entitled to a renewal on the terms of the original lease, namely, the purchase of the freehold on the terms of the 1967 Act or a renewal on the terms of the original lease. A strong case can be made, namely, that the people concerned were the victims of a defect in the earlier legislation despite their long leases and it is for the purpose of covering them that I have drafted this amendment. Like the other amendments it had to be drafted with the time factor limiting the opportunity for full investigation of the precise terms but it is designed to do that.
The arguments that applied to amendments Nos. 5, 6 and 7 could be applied to this also and the problem is the same. However, we may have reduced the numbers involved to a mere handful. One point that strikes me about the amendment is that it would give the right to purchase the freehold but, as I understand it, at least one of the two people mentioned who are in the more extreme difficulties purchased the freehold and, therefore, the amendment would not be of any use to him. I do not know, but it may be that the other man did the same thing. It may be that we have reduced the problem to these two people but beyond that we cannot go for the reasons I have given. This would be an even more blatant setting aside of an executed contract: there would be a conveyance of the fee simple executed and registered and so on, or there would be an executed and registered lease for 21 years or whatever period. It would not be just a matter of setting aside the contract but it would be a matter of setting aside the whole title and I could not see that ever standing up. I am sure Deputy Cosgrave will appreciate that it would create a most undesirable precedent. If it were possible to do it in this instance to benefit the people involved we might all be agreeable to do this, but the House must ask itself if we can afford the risk of setting such a precedent in our legislation. I do not believe we can, not because I think that it would be wrong to do it here in anything other than a constitutional sense but it would give all kinds of people the right to ask us to do it again in other cases. One does not need much imagination to visualise some of the cases where there might be pressure for it to be done.
I appreciate what the Minister has said. The only thing I suggest is that the landlord in question might consider that, the Dáil having taken the action it has taken in this matter, some refund might be made to the two persons concerned in view of the size of the estate and the peculiar circumstances.
That would be a fair thing to do. I should have mentioned that this amendment would not be confined to two men on the Proby Estate. It would create havoc elsewhere and could create great injustice in other instances.
I appreciate that but I was anxious to draw the attention of the Minister, of the House, and of the landlord in question to this problem.
It is important to bear in mind in regard to this and the other amendments that if the sympathy the Minister is now displaying had been shown in the earlier part of 1969 we should not be facing this impasse now. The Minister's predecessor said that the tenants were getting good value for their money when they signed the contracts and he did not display much sympathy for them. If the Government had been prepared to say to the Proby Estate that they should desist from insisting on the signing of such contracts we should not have this situation now.
It is important to point out that the "mere handful" to whom the Minister has referred are the people— Mr. Patrick E. Boland and Mr. Vincent Pentony in particular—whose rights are still not recognised by the Minister's acceptance of Deputy Cosgrave's amendment. Were it not for their agitation and for the fact that they persistently exposed the severe injustices which have become public knowledge and which gained a good deal of notoriety, it is unlikely that any amelioration of their position would have been conceded in this Bill. The minimum assurance we might receive from the Minister is that on the passage of this Bill he might write to Mr. Proby in Eton——
Would the Deputy deal with the amendment?
I am referring to the amendment. The Minister might write and ask that at least compensation, say, £3,000 might be given to Mr. Boland and to Mr. Pentony. While we appreciate the Minister's constitutional difficulties, he should seek redress on behalf of Irish people who have been badly treated. Indeed, this raises the whole question to which Deputy Fitzpatrick referred, namely, the moral justification of ground rents.
The Deputy is getting away from the amendment.
I think that in good Irish style we are away from the heart of the matter, and this is a problem which Dáil Éireann will have to face in the years ahead.
(Cavan): I agree with the Minister when he says that Deputy Cosgrave's amendment is not confined to cases on the Proby Estate or to the Proby Estate at all. I rise to support the thinking behind the amendment. It proposes to move in the direction of enabling tenants or lessees to purchase their landlord's interest. I want to make it perfectly clear that I do not stand for confiscation in any shape or form. I believe these purchases should be made on reasonable and on equitable terms which would take into consideration the investment of the landlord in the property and that would enable the tenant to buy out on fair and reasonable terms.
Deputy Cosgrave mentions in connection with this amendment the case of a person holding under a 21-year lease who might have held under a 99-year lease which expired before the coming into operation of the Ground Rents Act. I do not think such a person is entitled to purchase out. He would have been entitled if he were holding under a 99-year lease and if there were at least 25 years to run, but he may have held under such a 99-year lease which has expired and may have got a 21-year lease in place of it. It would be reasonable that such a person should be able to buy out as if he had held under the 99-year lease. I think the trend should be towards enabling people in occupation of dwellings as tenants or lessees to purchase out those buildings on reasonable and equitable terms, that legislation should be introduced to enable such lessees or tenants to purchase out on reasonable and equitable terms and, failing agreement between the landlord and the occupier, that such terms should be fixed by the court.
We have now apparently reduced what I would call the Proby problem to two distinct cases but two cases which present the Minister with constitutional problems and with the question of setting up what he considers dangerous precedents which might be availed of by other people to say: "We are entitled to similar treatment." One does not like using this House to appeal to individuals to do justice, especially when they acted as the law permitted them to act when they so acted. Nevertheless, this problem of the Proby Estate has been, to my own personal knowledge, cropping up in this House from time to time over the years. If it is all going to be solved now with the exception of the cases of two people who will go into their graves believing they have been robbed and been the subject of injustice, I would like to add my voice to those of Deputy Cosgrave, Deputy Desmond and indeed the Minister in saying that perhaps the owners of the estate might close the chapter by meeting—I shall not use the word "restitution" because that might be considered offensive—these two people who are caught in the trap, by making some payment to them or some compromise with them. That would close the matter in a dignified, honourable and just way.
Amendment, by leave, withdrawn.
(Cavan): I move amendment No. 11:
In subsection (1), page 6, line 31, after "years" to add "or which is occupied by a tenant of the lessee where the lessee holds under a lease the term of which is more than 100 years".
Amendment No. 12 is consequential and therefore Nos. 11 and 12 may be taken together.
(Cavan): Section 10 of the Rent Restrictions (Amendment) Act, 1967, had effects which were never foreseen by the framers of the section, by the Minister who piloted it through this House or by the Deputies here. It provided, in effect, that a person could not sell or assign or transfer the house in which he resided without the consent of the landlord. That apparently had not previously been the law, and immediately the 1967 Act came into force the absurdity of the provision was seen by the legal profession and they immediately drew it to the attention of the Minister's predecessor.
He also saw that the effects of the section went much further than intended. A promise was given to remedy it at the first opportunity. Even in matters of urgency it can take much time—from 1967 to 1971—to make good a defect like this. My amendment invites the Minister to go further. It would enable a person to sell his house without the lessor's consent, but it does not help a man who has his house let for years and ultimately gets possession on the death of the tenant or accepting a lump sum on giving up possession. In such a case he will have to get consent of the lessor unless he goes and resides in the house. That is the effect of the section. Section 10 of the Bill reads:
(1) Section 10 of the Rent Restrictions (Amendment) Act, 1967 (which imposes a restriction on the assignment of controlled dwellings) shall be deemed never to have applied to a house which is occupied for the purposes of his own residence by a person who holds it under a lease the term of which is more than twenty-one years.
That means that, if a person holds a house under a lease for 999 years and has that house let to a tenant, he cannot sell it or assign it without the consent of the landlord because he is not in occupation. It would also mean that if the landlord were to buy out the tenant or the tenant were to surrender the house or to die leaving no one in the house or if the landlord were to purchase the tenant's interest in the house he still would have to get the consent of his head landlord if he wanted to sell unless he went and took up residence in the house. That is as I understand the section and how an experienced practitioner in this city understands it. The case has been made that it is absurd that a man holding a lease for 999 years at £5 cannot give a valid assignment without the consent of the lessor. It is difficult to believe that the framers of the Act of 1967 meant to impose such a restriction.
My amendment will provide that a person who holds under a lease, the term of which is more than 100 years, can assign or sell or transfer without the consent of the head landlord whether he is in occupation or not. That is the case which has been put to me and I accept it and would be glad to hear the Minister's views on it.
When I read the amendment I could not see what precise point it was getting at. It seemed to me to be designed to free the restriction which exists under the Rents Acts on the assignment of controlled dwellings. This is one effect of it. Having heard Deputy Fitzpatrick I see that he intended the amendment to do something else but, as often happens, the amendment would have an unintended effect because the effect would be to lift considerably the restrictions on the assignment of controlled dwellings. Deputy Fitzpatrick knows that one of the consequences of that would be to give rights to an enormous number of people who never thought they had rights and to deprive owners who had an expectation of a reversion on the death of a controlled tenant or on a controlled tenant leaving voluntarily, of getting possession. If the words are added "which is occupied by a tenant of the lessee where the lessee holds under a lease the term of which is more than 100 years" the net effect of what would be done might be to remove the restriction on assignment of a controlled dwelling wherever the head landlord holds under a lease on the term of 100 years or more even though he might have only a year to go.
(Cavan): What is the objection to that?
It might give too wide rights to controlled tenants to dispose of their property.
(Cavan): I never intended that.
I know that. I am saying that it is an unintended effect. They would never have expected to have that. I am sure the Deputy did not intend it. If the Deputy looks at it he will agree that that is the effect.
(Cavan): I might clarify the position as I see it. If A holds a house for 100 years and he occupies the house as the Bill stands he can sell it without the consent of his landlord. I take it that is clear. The same A holds a house for 100 years but he has let the house to B. A cannot sell his interest in the house without the consent of his landlord because it is let to B. It is even worse than that because he cannot sell to B, his tenant, without the landlord's consent. That is the position I want to remedy through this amendment.
A holds from X under a letting for 100 years and he is living in the house. He can sell it to anybody he likes without the consent of X, if the amendment goes through. But if instead of A living in the house he lets it to W he cannot sell subject to W's tenancy without the consent of X.
I think I can shorten this. I think Deputy Fitzpatrick is right in what he is saying but I am afraid the amendment is grossly wrong and could have horrific consequences. I am afraid I might have to amend the amendment, having studied it more fully. This Bill has been so delayed now that it is getting people who were waiting for it into trouble but I am afraid I will have to amend it. I am grateful to Deputy Fitzpatrick. If he is as right as I think he is, I will have to amend the Bill in this respect.
(Cavan): I am grateful to the Minister. There has been a very reasonable discussion throughout the Bill.
Amendment, by leave, withdrawn.
Amendment No. 12 not moved.
Section 10, as amended, agreed to.
Section 11 agreed to.
Title agreed to.
Bill reported without amendment.
Report Stage ordered for Thursday, 25th November, 1971.