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Dáil Éireann debate -
Wednesday, 17 May 1978

Vol. 306 No. 8

Landlord and Tenant (Ground Rents) (No. 2) Bill, 1977 : Report and Final Stages .

Bill recommitted in respect of amendment No. 1 :

: I move amendment No. 1:

In page 3, line 22, to delete "June" and substitute "August".

Section 2 proposed that the Bill, when enacted, would come into operation on 1 June 1978. This proposal was contained in the Bill as circulated on 10 January 1978 and was intended to be the date, a matter of weeks after the Bill had become law, to allow time for the preparation of the necessary fees order and for the prescribing of the necessary forms for the operation of Part III—for example, the form of investing certificate to be given under section 22 (1). Clearly, the 1 June date is now inadequate for this purpose and, even if it could be assumed the Bill would be enacted before that date, this amendment proposes that the commencement date shall be 1 August 1978. The reason a specific date is necessary is to enable persons whose leases have expired, and who may be depending on section 13 to acquire their rights, to know precisely when their leases had expired eight years before the commencement. Because of the change now proposed in this amendment it is also proposed to extend this eight-year period in section 13. This will be done under amendment No. 4.

: I appreciate the difficulties in relation to the date mentioned in the Bill. It seems clear that, apart from any difficulty in completing the necessary forms and the fees order, the Minister might have difficulty in clearing the Bill through the Oireachtas to meet the date 1 June. While I would be anxious to see the Bill in operation as soon as possible, I accept the new date is now necessary.

Amendment agreed to.
Amendment reported.

: I move amendment No. 2 :

In page 4, line 2, to delete "premises" and substitute "land"

In the course of the debate on section 3 on 8 March at column 113 of Volume 304 of the Official Report, Deputy O'Keeffe queried the use of the word "premises" where it occurs in the definition of immediate lessor and contrasted its use with the use of land elsewhere in the Bill. "Premises" is not incorrect since the expression includes land together with the buildings thereon. Nevertheless, the Deputy's point is taken, that the same expression should be used throughout the Bill to convey the same meaning. The amendment should meet the point raised by Deputy O'Keeffe.

: I entirely accept this amendment, which as the Minister said, arises out of the Committee Stage discussion. It appears to me to tighten up the Bill. The use of the word "land" is preferable and in the circumstances, I accept the amendment.

Amendment agreed to.
Bill recommitted in respect of amendment No. 3.

: I move amendment No. 3 :

In page 6, to delete line 23 and substitute:

"force and provided that it shall be presumed, until the contrary is proved, that the person to whom the lease was granted was so entitled;".

On the Committee Stage debate on 8 March, as reported in the Official Report, Volume 304 at columns 1168-9, I gave the House notice of intention to propose on Report Stage an amendment to section 10 to cater for a group of people I had seen only on the previous day. The people are tenants of the Cappoquin Estate Company, Cappoquin, County Waterford. From the facts put before me it appeared that these persons were not, as had been thought to have been the case, covered by Part II of the Bill. I indicated that I was considering the possibility of amending section 10.

Generally speaking, these tenants hold their houses under leases for terms of 60-99 years. These leases, granted between 1910 and 1930, were granted at rents slightly in excess of the rateable valuations of the property and were in succession to earlier leases also for terms of 60-99 years whereunder the rents were less than the rateable valuation. The tenants believe that the present leases were granted to the persons entitled to the lessees' interest under the previous leases. However, they lack evidence to establish this; although they presume the landlord's records, which are not available to them, would show that this is the case. The amendment relates to the question whether the present lease was granted to the person entitled to the lessee's interest under the previous lease, that is the question whether the lease satisfies condition 5 (b) of section 10. The amendment would simply shift the burden of proof in this respect from the lessee, the tenant, to the landlord, the lessor, I believe that this is defensible since the landlord is much more likely than his tenant to have kept the necessary records and to be in a position to establish the facts. Accordingly, such a change is acceptable to cater for the situation of the tenants in question and indeed of any other persons who may be in the same situation. This is what my amendment proposes.

: I welcome this amendment. It meets the problems raised by the Cappoquin tenants and may also meet a similar type of problem of tenants in a similar situation. It is an improvement of the Bill and I welcome it.

Amendment agreed to.
Amendment reported.

: Amendment No. 5 may be discussed with amendment No. 4 as they are alternatives.

: I move amendment No. 4:

In page 7, line 14, to delete "eight" and substitute "ten".

Section 13 of the Bill proposes that persons whose leases expire up to eight years before the commencement date of the Bill when enacted into law shall, for a 12 month period, be able to exercise the right to buy out the fee simple, assuming they come within the scope of legislation, notwithstanding the expiration of their leases provided they are still in possession of the property and have not entered into any new arrangement with the landlord. A similar type of provision has been included in every Landlord and Tenant Act, including the 1931 Act. In the case of the 1931, 1958 and 1967 Acts the period of retrospection provided for was five years. In the 1971 Act it was eight years and in the Landlord and Tenant Bill of 1977, which lapsed with the dissolution of the last Dáil, the period proposed was also eight years. The lapsed Bill was circulated in January 1977. The commencement of the present legislation is now, by virtue of the acceptance of my first amendment here today, being postponed from 1 June to 1 August. This raises the possibility that, if a period of eight years retrospection was necessary in January 1977, a rather longer period may be necessary to ensure that the same lessees whose right to buy out is being recognised for the first time, do not lose that right by reason of the fact that the eight year period has gone by. In fact, only one case has been brought to notice and even that is a somewhat doubtful one where the lessee under an expired lease would lose the right to buy out if the retrospective period of eight years is not extended as proposed. However, there would probably be general agreement that even one case would justify the extension of time retrospectively and that is what is proposed in this amendment.

: I am glad the Minister has accepted that some extension is necessary. He proposes to extend the period from eight to ten years. My amendment suggests an extension to 15 years. In putting down the amendment it occurred to me that more people would probably have the chance to take advantage of this Bill by extending the period to the time mentioned. Only a handful of cases have been brought to my attention where the lessees may or may not be entitled, depending on the time factor involved.

I do not press my amendment unduly other than to suggest to the Minister that if he accepts that there is even one case that will come within the ambit of the ten-year extension, almost certainly there would be cases where the 15-year extension would provide relief. Now that he has come so far in increasing the period from eight to ten years he might consider the matter further when the Bill is before the Seanad. I do not press the matter further than that. I do not think there are many people involved in this category, but if there were any such people who would be helped by the additional extension of time I should like to see them helped.

Amendment agreed to.
Amendment No. 5 not moved.

: I move amendment No. 6 :

In page 8, line 20, after "than" to insert "twice".

This is a fairly important amendment and I ask the Minister to give it serious consideration. Section 15 relates to a person who holds land generally as a yearly tenant and extends relief to persons in this category who come within the terms of this section. One of the requirements of the section is that to be entitled to relief thereunder the yearly rent must be less than the rateable valuation of the property at the date of service of the notice. A number of cases have been brought to my attention where difficulties arise under this heading. The other aspects of this section do not seem to offer any great difficulty: the fact that the land must be covered by permanent buildings, that it must be held under a yearly tenancy or something similar, that there must be proof of a certain number of years holding under one or more of the tenancies for a period of not less than 25 years, and a certain number of other items which do not give rise to any great difficulty.

One of the difficulties which has been brought to my attention in a number of cases is this requirement that the yearly tenant in such circumstances must show the yearly rent is less than the rateable valuation of the property. Many householders who will be attempting to take advantage of this section will be living in houses which are quite old and, in those circumstances, it is more than probable that the rateable valuation assessed at the time will be quite small. I know cases which seem to fit into the section where the valuation is as low as £2 or £3. The purpose of the amendment is to allow people who would otherwise be able to claim relief under this section to do so provided their yearly rent is less than twice the rateable valuation.

The Minister will probably accept the point that it is the intention of all of us, in accordance with all principles of fairness and justice, to try to extend the relief that can be given under this Bill to as broad a category of people as possible. I suggest to him that, if this amendment is accepted, yearly tenants whose rent is less than twice the rateable valuation will be able to take advantage of this section of the Bill. If he accepts the viewpoint that yearly tenants who would otherwise qualify should be permitted to qualify and should not be excluded merely because their yearly rent is slightly more than the valuation, I would ask him to accept the amendment.

: Much as I would like to oblige the Deputy because of the case he has made, I am afraid the proposed amendment would be an important change of substance since the circumstance that the rateable valuation equals the rent has been taken to be prima facie evidence that the rent is an occupational rent. This is because the original valuations were the annual letting value. This, in turn, would suggest that any house with a rent equal to or greater than the valuation would not be subject to a ground rent tenancy. Because the amendment, if accepted, would be an important change of substance, I am convinced that a change of this kind in the law, if it were to be contemplated at all, would be inadvisable without first getting the views of the Landlord and Tenant Commission on it.

: I have to accept that it relates to the basic position whether a person's occupation is as a ground tenant or otherwise. I suggest to the Minister that, while this Bill is designed to cover people paying ground rent and does not deal with the situation of occupational rent, if one looks at it in another way, it is very difficult to consider a rent which is slightly more than the valuation, perhaps only £1 more, as being an occupational rent. There may have been some historical factors for having the ground rent fixed at the time slightly higher than the rateable valuation.

I would ask the Minister to bear in mind that I am not attempting to open the door completely. I see the difficulty of dealing with this Bill on the basis that we are dealing with ground rent tenants only. I suggest quite seriously there are cases where rents which could only be classified as ground rents exist which are slightly greater than the rateable valuation. We could look at it from the point of view of how rateable valuations were fixed. It is correct to say that rateable valuations in many parts of the country are not always on a totally even basis. A house with an old valuation of £5 in one place might have a valuation of £7 or £8 in another county.

This is not an attempt to breach the entire situation and open up the advantages of the Bill to other than genuine ground rent tenants, which is what is intended here. It is an attempt to meet some quite genuine hard cases which have been referred to me. I can tell the Minister specifically of such cases which would come within the terms of this section if this amendment were accepted. I can refer him to some cases in County Wexford where valuations appear to be of the order of £3 or £4 and the rents of the order of £5 or £6. I gather there are quite a number in this category. By no stretch of the imagination could rents of that category, no matter how long ago they were fixed, be classified as occupational rents. They are ground rents.

I am sure people in other parts of the country are in a similar situation. They are being left high and dry, unless we try to cope with the problem raised. The way in which I suggest doing it is quite simple. It does not upset the balance as between constitutional claims on the property in any way. It merely extends the scope of the Bill to include people who are paying ground rents and who, if we do not change the Bill, will not be able to take advantage of it.

As I say, I have had cases from one specific area quoted to me. The Minister referred earlier to a specific amendment he made to deal with a situation in Cappoquin. I am glad he accepted the representations made from that area and incorporated the necessary amendment to meet the situation. Perhaps I could refer to this suggestion as being the Wexford amendment, and I am sure the Minister will be as anxious to look after Wexford people as people from Cappoquin. It may be that he would like to take further advice on the position and get some word from the Landlord and Tenant Commission.

: I am quite prepared to send to the Landlord and Tenant Commission.

: That is fair. The point which worries me a little about it is the time factor involved and whether any report will be received by the Minister in time for the Seanad debate. It would probably need to be included on Committee Stage in the Seanad. I will leave it with the Minister on the basis that it seems to me to be an absolutely genuine case. These are people who cannot be classified as other than ground rent tenants and they should be able to take advantage of the Bill. The suggestion in my amendment will bring them within the terms of the Bill without being unfair to anybody. If the Minister is prepared to see if it can be incorporated in the Bill I am prepared to leave it at that.

Amendment, by leave, withdrawn.

: Amendments Nos. 7, 8 and 9 are related and may be taken together.

: I move amendment No. 7:

In page 10, to delete lines 17 to 21 and substitute the following:

"(g) the price paid by the lessor in purchasing the land and the amount of the site fine paid by the lessee,

(h) the number of years in which the rent has already been paid by the lessee,

(i) the costs and expenses which have been incurred by the lessee due to the failure of the lessor to maintain any local amenities such as gardens, footpaths, playing spaces which he had covenanted to do under the terms of the lease,

(j) the failure of the lessor to make any demand for payment of rent over a period of years.".

We are dealing with section 17, with that part of the Bill which relates to the price to be fixed by the arbitrator. This arises when the ground rent tenant is not entitled to take advantage of the automatic multiplier under the Bill. If he is not so entitled he will have to have the price to be paid fixed by the arbitrator who, at this stage, is settled as being the Registrar of Titles. There are a number of factors to be borne in mind by the arbitrator in assessing the price, including the rent, the length of time that the lease has been outstanding, the current yields on Government securities and so on.

One of the matters which we discussed at some length on Committee Stage was the requirement that the arbitrator has to bear in mind the cost and expenses incurred by the landlord in reinvesting the purchase money. I did make a number of points in regard to this matter on Committee Stage. The first point was that this cost and expense should not be a matter for the ground rent tenant but a matter for the landlord. I was, and still am, anxious that that requirement of the arbitrator should be removed from the terms of the Bill. I pressed the Minister strongly on this point and suggested to him that, if he could not accept what I had to say, he should at least bear in mind that the landlord should be restricted in the costs and expenses that he would incur and pass to the tenant. The Minister has come some of the way to meet me, subject to the qualification that I was anxious that the entire costs and expenses being put on the tenant should be removed. The Minister has not accepted that point but I am glad that he has come some of the way to meet us and has accepted that such costs and expenses should be reasonable, and that is specifically provided for in the Minister's amendment.

Since the Minister has accepted that any such costs and expenses should be reduced to as reasonable a proportion as possible, I suggest that he might go the whole hog and eliminate them entirely. I welcome the suggestion that they cannot be unreasonable costs and expenses. That was one of my major fears on Committee Stage.

: That trip to China is out.

: The trip to China is out. I am sure that a number of landlords will be very sorry to hear that. Allied to that amendment there was the suggestion that certain other factors should be borne in mind by the arbitrator in assessing the purchase price. I am now putting before the House the suggestion that certain additional items should be considered by the arbitrator. There are four points involved. Again, I am glad that the Minister has accepted one of the four points—that the arbitrator should be entitled to bear in mind the expenses suffered by the ground rent tenant in maintaining local amenities which the landlord should have done, and which he is in breach of covenant for not doing. I will be making a similar argument to the Minister. He has accepted that this is a matter which must be borne in mind by the arbitrator.

I welcome the Minister's reaction but, having gone so far, I put it to him that the other points which we suggested should also be borne in mind by the arbitrator and might also find a place in the Bill. The other three points relate to the price paid by the landlord, the number of years in which the rent had been paid by the lessee and the failure of the lessor to make any demand for rent over a period of years, and go to the root of what the landlord himself paid for the property in question and on which the arbitrator is now fixing a price. It seems only reasonable that the arbitrator should bear this in mind. It is not a totally determining factor but it should be borne in mind by the arbitrator in assessing the purchase price as between the lessor and the tenant.

The length of time is another factor which I believe the arbitrator should bear in mind. In regard to the failure to make any demand for payment of rent, it seems that the landlord must not rate the value of his property very highly if he has not bothered to collect the rent. It seems a reasonable point for inclusion. It is something that the arbitrator should bear in mind when fixing the price as between the landlord and the tenant.

In summing up, I welcome the fact that the Minister has reduced the question of expense and reinvestment to what would be reasonably incurred and that he has now provided that the arbitrator must bear in mind any expenses of the lessee in maintaining amenities which the landlord should have maintained. Having gone so far, I would ask him to go the whole hog and allow the other factors which the arbitrator could bear in mind in reaching an equitable price as between the landlord and the tenant.

: I would again point out that amendment No. 7 is before the House and that we are discussing amendments Nos. 8 and 9 with amendment No. 7.

: Is it amendment No. 7 that is before the House and are we discussing amendments Nos. 8 and 9?

: Amendments Nos. 8 and 9 will be put without further discussion. When amendment No. 7 is disposed of the Minister will move them.

: On Committee Stage I dealt at considerable length with the position in relation to section 17 (g). In it I pointed out the position whereby, when the property is acquired by the tenant, after arbitration the landlord was entitled to be paid the costs and expenses incurred by him in investing the money payable in respect of the acquisition of the fee simple. I have never heard of a situation where a person disposing of his interest in a property had his costs and expenses paid by the purchaser in respect of the investment of the moneys. It is a unique position.

The Minister in his amendment deals with the expenses which would be reasonably incurred and so he defines to some extent the limit of costs and expenses which a vendor would be entitled to in the investment of these moneys. The Minister should go a step further and wipe out this section altogether. I do not know of any situation where a landlord would have his costs and expenses in investing his moneys obtained from the tenant paid by the tenant. This is an unsatisfactory situation. The 1967 Act had a provision analogous to this but it was not so far-reaching. The arbitrator decides on what he considers a fair price to be paid by the tenant to the landlord and the landlord has then to invest the money. It could happen that a landlord on disposing of quite an amount of property would decide to call in some expert advice. This advice would be very expensive and far removed from the usual source of advice that people seek on investment, and the expenses could be enormous. The provision is qualified to some extent by the word "reasonable", but who decides what is reasonable? The Minister has gone some of the way; he should go all of the way. If the lessor fails to make any demand for payment of rent, that is OK; but I hope that a statutory limitation with regard to the collection of debts would apply in this instance as in all others.

: During the Committee Stage debate, when we had a similar amendment for discussion, I explained the reasons why I then found that amendment unacceptable. The reasons given then, which were valid then, are valid now. I did, however, accept that paragraph (i) of the proposed amendment was acceptable and accordingly, as will be seen from amendment No. 9, this amendment is designed to meet this point. The amendment in the names of Deputy O'Keeffe and Deputy Enright would require the deletion of the existing paragraph (g) and would have the effect that the arbitrator would not be required to take into account, in determining the purchase price, the costs and expenses of the landlord in investing the purchase money. The retention of this provision is necessary to protect the section from any challenge on constitutional grounds which might arise if the landlord's interest was in any way lessened by the Bill's provisions. However, in amendment No. 8 I propose to meet the Deputies' point to the extent of specifying that these expenses must be reasonable. The new paragraph to be inserted would require the arbitrator to take into account various matters in favour of a reduced purchase price.

It should be emphasised that section 17 (2) consists of a list of considerations which are only a guide to the arbitrator in drawing up the price and that this list is not exhaustive, nor does it mean that the arbitrator is restricted by its contents. Indeed, paragraph (i) enables him to have regard to such other matters as are, in the opinion of the arbitrator, relevant to the determination of the purchase price. The parties to the arbitration will therefore be free to bring any matter to his attention and it will be up to him as arbitrator to decide whether or not such matters are relevant to the determination of the purchase price.

As regards the matters to be inserted by the proposed amendment, it is considered that some of them are not relevant to the determination of the purchase price. For instance, a site fine, if any, paid by the tenant when he purchased the house is irrelevant to the determination of the value of the property being acquired. That property is the landlord's interest under the lease. Similarly, the question of how long the rent has been paid or whether it has been demanded is irrelevant. The eriteria in section 17 (2) can be described as a package deal that has as its purpose to evaluate the interest being acquired. It is the same as is in the 1967 Act and has stood the test of time, having been found fair to all parties. It was based on the recommendation of the Ground Rents Commission, made with full regard to the constitutional issues involved. If it were changed, in particular so as to tend significantly towards a lower purchase price, there is no doubt that it could be held to be confiscatory and would lead to constitutional problems.

Section 17 deals with the determination of the purchase price of the fee simple or any other interest by arbitration, and the paragraphs of section 17 (2) set out the matters to which the arbitrator is to have regard when determining the price a willing purchaser would give and a willing vendor would accept. I indicated my agreement with the argument that, where a ground rent lessee has been involved in costs and expenses because of the lessor's failure to observe any covenants in the lease for the maintenance of local amenities such as footpaths, those costs and expenses should be taken into consideration in the determination of the purchase price that the ground rent lessee should have to pay. Accordingly, I am proposing in my amendment No. 9 that such costs and expenses should be included in the matters to be regarded in arriving at the purchase price.

: I support the proposed amendment particularly in relation to the inclusion of the cost of works that have not been completed by the ground landlord. This has been an extensive problem with residents' associations particularly in the city of Dublin.

: I accept that the Minister has gone part of the way to meeting the point we made, but it appears that we cannot take him any further along the road. The other factors appear to be items that would be fairly and reasonably added to the list to be borne in mind by the arbitrators.

Amendment, by leave, withdrawn.

: I move amendment No. 8:

In page 10, line 18, to delete "will be incurred" and substitute "would be reasonably incurred".

Amendment agreed to.

: I move amendment No. 9:

In page 10, between lines 21 and 22, to insert:

"() the costs and expenses which, in the opinion of the arbitrator, have been incurred by a person acquiring the fee simple who holds the land under a lease by reason of the failure of the lessor to maintain any amenities which he is required to maintain under a covenant in the lease,".

Amendment agreed to.

: I move amendment No. 10:

In page 11, line 20, to delete "five" and substitute "twentyfive".

This amendment relates to the period of time during which the simplified procedures for purchase of dwelling houses shall continue. Section 18 provides that these simplified procedures shall have effect only in relation to applications made under that section during a period of five years. The amendment proposes that this period should be increased to 25 years. This would mean that householders would have a much longer time during which to take advantage of the terms of the Bill.

There is a rather long tradition in respect of ground rents. I am sure that the Minister as well as Deputy Enright and I had in mind ensuring that every person paying ground rent would have the option and should be encouraged to buy out his ground rent. It seems clear that if this is the object it will not be achieved within a five-year period nor even within a 25-year period. If we are genuinely anxious that householders convert their titles into freehold by taking advantage of the Bill, is it not obvious that the longer period in which they have to do that the better chance there is of the desired situation being brought about.

I have no doubt that by substituting a period of 25 years, far more people will take advantage of the legislation. On Committee Stage the Minister referred to the need to put a time limit on the Bill. The main point he made was the need to introduce a sense of urgency so that people would take advantage of the Bill. That sense of urgency is there already, on the part of those who intend taking advantage immediately of the legislation. These are the people who will apply to the registrar to purchase their ground rents very soon after the Bill is enacted. However, by no stretch of the imagination will the number of people who will be involved initially go anywhere near the total number paying ground rent. This Bill, as is the case with most landlord and tenant legislation, is very complex and many householders do not understand fully what it is all about.

In view of the rather complex legalities involved I do not blame people for not understanding the legislation. It will be a long time before many of them become aware of their entitlements under the legislation. That awareness may arise only by chance when, for instance, property is passing to another member of a family or when there is a marriage settlement or in the event of someone selling a house and moving to another. At that point they would be likely to wish to take advantage of the legislation. I do not accept the Minister's point that there must be a relatively short time limit in order to encourage people to take advantage of the Bill. People involved in a tenant organisation who are involved actively in following this legislation will be all right. They know the situation. There is no need for any pressure to be brought to bear on them. They will be standing by waiting for the registrar's office to open. However, that situation applies only to a certain section. Let us look after all sections. It was my intention originally that there would be no time limit but if the Minister insists that there must be a time limit, let us make the period one during which many more people would be enabled to take advantage of the legislation.

The second point made by the Minister on Committee Stage related to the amount of effort and money the Exchequer would devote to manning and maintaining the ground rents section of the Land Registry. Surely the Minister must accept that with the effort that is put into establishing such a section and into recruiting the necessary personnel and providing all the necessary trimmings that go with that operation, it is not sensible to impose a cut-off point after five years. The major expense involved would have been incurred already and in the main the only continuing expense thereafter would be the payment of the staff but since at that stage the staff would be civil servants, presumably the Minister could find other jobs for them in the Department. I suggest that the proper course to adopt would be to allow the staff continue doing the job for as long as necessary. If the Minister accepts that it will be necessary to extend the legislation for longer than five years why should he draw the line?

I do not want at this stage to appear to be speaking politically or to raise the matter of words like "abolition". If we are seriously interested in giving ground rent tenants the opportunity to buy out, let us put it on the Statute Book and give them a reasonable time in which to do so. The period of five years is not a reasonable time. I would hazard a guess that the majority of people will not be able to take advantage of this Bill during the five year period. There are many examples I could give of categories of people who will not be able to do so. The obvious thing to do is to extend the time. If the Minister wants to put some limit on the provisions of this Bill, the recommendation we have made is that it should be increased to 25 years. That is not unreasonable. If the life of this part of the Bill were extended to 25 years, there is a fair chance that most people would have knowledge of the situation and would have the opportunity to take advantage of it. In such a situation it might be difficult to have any sympathy for people who would not have availed of the section at the end of that time.

I strongly urge the Minister to accept this amendment and to accept that the five-year period is too short. If there has to be a time limit, the period of 25 years is much more reasonable. If we are seriously interested in achieving the end of the ground rents system, then by changing the limit from five years to 25 years we have a far greater chance of the majority of householders taking advantage of the provisions of the Bill. If we do not change, any pretentions about achieving the end of the ground rents system cannot stand up. I cannot put it more strongly than that.

: This is the third Landlord and Tenant Bill that has come before the House during the past 18 months. The former Minister for Justice brought in a Bill and this is the second Bill introduced by the present Minister. One political correspondent, looking at the original list of amendments put forward on Committee Stage, thought that the debate on this Bill would last until Christmas. This matter has not dragged on; it has now reached the concluding stages. There are some minor amendments which the Minister has tabled.

This section strikes at the very root of this Bill because of the time factor involved. The Minister has been very open-minded in all the discussions that have taken place and he has met most fairly the points of view expressed on all sides of the House. Deputy O'Keeffe agrees with me that the Minister has gone out of his way to be helpful and co-operative.

We are bringing in a cut-off point within five years of this Bill becoming law. The Minister admitted to Deputy O'Toole that he intended bringing in and training approximately 50 or 60 additional staff in the Land Registry to deal with work arising from this legislation. I do not imagine that these people have yet commenced training and I do not know when it is intended that they should do so. It must be admitted that it will take a long time to train people for this highly complex and difficult task. They will be dealing with titles, some of which may go back as far as the twelfth or thirteenth century. People who may have no previous experience will have to investigate these titles and then furnish vesting certificates. The Minister will have to arrange accommodation for them because, as he admitted in reply to questions from Deputy O'Keeffe and myself, there is not sufficient accommodation in the Four Courts.

All these factors being taken into account, it is obvious that this five-year limit is far too short. In one of his statements to the House the Minister said that a benefit was being bestowed upon people, a gift waiting to be accepted, and that if people did not want to accept it, it was their hard luck. I put it to the Minister that there are sizeable numbers of people involved who are working on limited fixed incomes and it is difficult for them to amass £300 or £500. They may find that they cannot get this amount together and then they will discover that the five-year period has elapsed. This factor must be borne in mind. All claims will be dealt with which are lodged within the five-year period. Nevertheless, by the imposition of a specific time limit the Bill is being curtailed and there will be a cut-off situation which is not necessary or desirable.

No further ground rents can be created. The Minister on Committee Stage dealt with the fact that he does not want the additional staff to be employed indefinitely on this work. I accept that and I do not want to see additional expense for the taxpayer. If the Minister employs 60 additional people to discharge this job and if the work load is not sufficient he can vary the number employed on the work. When the business trickles away he can have these people placed in other jobs. The Minister's point about people being presented with a gift does not wash with me. He also made the point that he does not want to have staff there with no work to do. If there are not sufficient jobs for them there, the Minister will be able to use them elsewhere.

The Minister might consider inserting in the Bill wording to the effect that at the end of a five-year period he will have power to extend the measure if that is deemed necessary because of the volume of business. I would go along with such a provision but I do not think the Minister will do that. We have had a number of more controversial measures that were renewed by order and that was accepted by both sides. This measure is not so controversial.

At the end of a five-year period the Minister or his successor will have to bring before the House legislation extending the measure we are discussing now. The Minister has a number of options open to him. He can agree to our amendment and extend the time. Deputy O'Keeffe and I would go along with him if he retained power to order that the measure be extended.

Irrespective of the publicity given to this measure on television, radio and in the newspapers, many people will not know about this until someone they know buys out their ground rent. Only then will such people be aware of this measure. The Minister can show his vision by agreeing to this basic amendment which goes to the heart of the Bill. By not including it in the Bill the Minister is restricting the advantages and merits of the Bill. He is telling people that unless they take advantage of what he is offering now they will have to do without it later. The amendment is most reasonable and the Minister should accept it.

: The passion with which Deputy O'Keeffe and Deputy Enright argued this amendment is most encouraging. To me it indicates that the benefits are quite substantial. During the course of discussion on Second Stage I said that I wanted to emphasise that the five-year limit was not designed to reduce the State's financial commitment to the scheme. I said that on the contrary the time limit may well increase that commitment because it will encourage all tenants to avail themselves of the scheme. That was on 8 February. On 22 February I had the opportunity of replying on Second Stage and I dealt with the arguments raised by many Fine Gael Deputies, who spoke on the five-year limit. I said then there was no question in my mind of making the scheme an open-ended one. I repeated the argument that the limit of five years is important because it will encourage all ground rent tenants to exercise their rights as soon as the Bill becomes law. I had a lot more to say but I do not want to repeat it now. We had a fairly long discussion on Committee Stage on 12 April.

I believe that the scheme which is going to last for five years will work and that it will encourage tenants to exercise their rights as soon as the Bill becomes law. It is extremely important that we should see clearly that it is only the low-cost scheme that is restricted in its life to five years. Persons who cannot avail of this scheme for some reason will be entitled to acquire the fee simple under the 1967 Act. I thought I had eased the anxiety of Deputies during the course of the debate on Committee Stage when I said that all applications made under this Bill up to the five-year period will be dealt with. This is so irrespective of how long it may take after that five-year period to deal with the applications submitted.

To leave the scheme open-ended or as a 25-year period would be extremely unwise. It could be allowed to drag on and on and it would have the opposite effect to what I have in mind. I accept what Deputy Enright has said that, as a result of the publicity given to this topic by the media because of discussions here and elsewhere, there will be a flood of applications to the Land Registry to be processed as and from the date the Bill becomes operable. I should like to assure the Deputy that the staff are ready to deal with it. We are ready to meet the onslaught whenever it comes. I should like to assure the Deputy that the staff will be working in close proximity to this building and it will make it easy for Deputies to visit their office.

In conscience, I could not have whatever staff may be involved in the unit concerned sitting twiddling their thumbs, waiting for 25 years for people to make up their minds whether to buy out their ground rents. Naturally, staff costs are very high and we could not have those people sitting around doing nothing. I am satisfied that the bargain we are giving so far as legal costs are concerned will be clearly recognised as a bargain. Even a sale in Clery's or Guiney's only lasts for a period; it is not a sale for 52 weeks. The bargain we are giving so far as legal costs are concerned will be there for five years. I accept this has been a serious bone of contention between the two sides of this House since we started to debate this legislation but I am convinced I am right. However, I will be the first to admit that time will tell.

I hope, whoever the Minister for Justice is in five years' time, that it will be incumbent on him to come before the House to do anything further about it. I am sure it will not be necessary for him to do anything about it. If there was any glimmer of hope to be given at this stage that that five-year period would be extended the Deputies would see that there would be need for the Minister for Justice in five years' time to come before the House to have amending legislation agreed to extend the limit. I want to say, quite categorically, that there will not be any extension of the five-year period for which the legal costs will be available for the nominal sum of £5 to those who want to buy out their ground rents.

: I am afraid that I am at odds with the Minister on this point. I cannot accept his arguments in relation to this amendment. He referred to our acceptance of the clear benefits under Part III of the Bill. Now that we are near the end of the debate on this Bill let me be quite clear and explicit that I fully accept that the procedures suggested in the Bill are a considerable improvement on the procedures which existed under the 1967 Act. They are providing a system which will simplify the procedures for householders buying out their ground rents. I welcome this Bill from that point of view.

I would not want there to be any confusion arising out of my opposition to the Bill, particularly on Second Stage, which related largely to the fact that the Bill did not measure up to a certain commitment given in a certain document before last June. That was my basic argument at that time. The provisions of this section are of benefit to householders. They are largely modelled on similar provisions in the National Coalition Bill. They are not original provisions at all. I certainly would, as the Minister mentioned, argue with passion on the benefits of this simplified procedure. I would not like my opposition to this Bill at another level to be misconstrued.

In relation to the time limit, any suggestion that more people will buy out their ground rents in a five-year period than a 25-year period does not stand up. If we are seriously interested in as many householders as possible to take advantage of this part of the Bill, surely the longer time we allow them to do that the more people are likely to take advantage of it. That seems to me to be common sense. The Minister suggests the sense of urgency the five-year period will introduce, will result in queues forming the day after the Bill comes into effect. There may be queues of people forming the day after the Bill comes into effect, whether it is a five-year period or a 25-year period, but I am thinking of the people who never heard of this Bill and who may not hear about it for 20 years. We might be a little like someone living in a glasshouse, having discussed the terms of this Bill for a period of at least 20 hours. We do not want to lose perspective. I have no doubt that a large number of householders who are paying ground rents at the moment have not a clue about the terms of this Bill. It will take a long time, perhaps a series of coincidences or otherwise, to have it get through to them that this procedure is there and that it would be in their interest to take advantage of it.

I have to reject the suggestion that more people will be encouraged to take advantage of the Bill by having a five-year time limit. I believe that, if a time limit is necessary, a period of 25 years must, in all common sense, result in a far greater number of people being able to take advantage of the Bill.

Deputy Enright covered the point with regard to staff in the Land Registry who will be dealing with this matter. The staff necessary to deal with the number of applications coming in are maintained. If there is a large number of applications there must be a large number of staff and if there is a small number of applications the staff is reduced. The Minister will have to bear in mind that, no matter what the time limit is, a certain number of staff will have to be maintained for quite a considerable period. This procedure envisages that moneys will be lodged and vesting certificates given. However, the landlords' interests and the mortgages thereon will have to apply thereafter to the Land Registry in connection with their respective claims to the moneys lodged. That may take a long time. I am certain it will be found that there will be a surplus of funds, as was found in the courts from time to time when they checked the books, never claimed for a variety of reasons. Accounts will have to be kept and there will have to be staff there for a long time to deal with that. There is no problem whatever, if the heavy ploughing is done, no matter how long it takes, whether five years or ten years, in shrinking the number of staff and the premises, bringing the staff back into a small section in the Land Registry, maintaining it there to provide the service and continue the work of transferring freeholds, issuing vesting certificates and also dealing with the landlords' side of the business involving the moneys lodged.

This is a point on which we must disagree. The five-year period is too short to allow anything like the majority of the ground rent tenants to take advantage of the terms of the Bill. I am not completely happy with the 25-year period. I do not see any reason for the time limit but if there is a reason the 25-year period is a lot more reasonable. I have to press the Minister to accept this amendment.

Question put : "That the words proposed to be deleted stand."
The Dáil divided: Tá, 63; Níl, 45.

  • Ahern, Bertie.
  • Allen, Lorcan.
  • Andrews, David.
  • Andrews, Niall.
  • Aylward, Liam.
  • Barrett, Sylvester.
  • Brady, Gerard.
  • Brady, Vincent.
  • Briscoe, Ben.
  • Brosnan, Seán.
  • Browne, Seán.
  • Burke, Raphael P.
  • Callanan, John.
  • Cogan, Barry.
  • Colley, George.
  • Collins, Gerard.
  • Conaghan, Hugh.
  • Connolly, Gerard.
  • Cowen, Bernard.
  • Cronin, Jerry.
  • Daly, Brendan.
  • Davern, Noel.
  • de Valera, Síle.
  • Doherty, Seán.
  • Fahey, Jackie.
  • Farrell, Joe.
  • Filgate, Eddie.
  • Fitzgerald, Gene.
  • Fitzpatrick, Tom (Dublin South-Central).
  • Fitzsimons, James N.
  • Flynn, Pádraig.
  • Fox, Christopher J.
  • French, Seán.
  • Gallagher, Dennis.
  • Geoghegan-Quinn, Máire.
  • Gibbons, Jim.
  • Haughey, Charles J.
  • Herbert, Michael.
  • Hussey, Thomas.
  • Keegan, Seán.
  • Kenneally, William.
  • Killeen, Tim.
  • Killilea, Mark.
  • Lawlor, Liam.
  • Lemass, Eileen.
  • Leonard, Jimmy.
  • Leonard, Tom.
  • Leyden, Terry.
  • Loughnane, William.
  • McCreevy, Charlie.
  • Meaney, Tom.
  • Molloy, Robert.
  • Moore, Seán.
  • Morley, P.J.
  • Noonan, Michael.
  • O'Donoghue, Martin.
  • O'Hanlon, Rory.
  • Reynolds, Albert.
  • Smith, Michael.
  • Tunney, Jim.
  • Walsh, Joe.
  • Wilson, John P.
  • Woods, Michael J.

Níl

  • Barry, Peter.
  • Belton, Luke.
  • Bermingham, Joseph.
  • Boland, John.
  • Bruton, John.
  • Burke, Joan.
  • Byrne, Hugh.
  • Clinton, Mark.
  • Cluskey, Frank.
  • Collins, Edward.
  • Conlan, John F.
  • Corish, Brendan.
  • Cosgrave, Michael J.
  • Crotty, Kieran.
  • D'Arcy, Michael J.
  • Deasy, Martin A.
  • Desmond, Barry.
  • Donnellan, John F.
  • Enright, Thomas W.
  • Fitzpatrick, Tom (Cavan-Monaghan).
  • Gilhawley, Eugene.
  • Griffin, Brendan.
  • Harte, Patrick D.
  • Hegarty, Paddy.
  • Kavanagh, Liam.
  • Keating, Michael.
  • Kenny, Enda.
  • Kerrigan, Pat.
  • Lipper, Mick.
  • McMahon, Larry.
  • Mannion, John M.
  • Mitchell, Jim.
  • Murphy, Michael P.
  • O'Brien, Fergus.
  • O'Brien, William.
  • O'Donnell, Tom.
  • O'Keeffe, Jim.
  • O'Toole, Paddy.
  • Pattison, Séamus.
  • Quinn, Ruairí.
  • Ryan, John J.
  • Taylor, Frank.
  • Timmins, Godfrey.
  • Treacy, Seán.
  • Tully, James.
Tellers : Tá, Deputies Kenneally and Briscoe; Níil, Deputies B. Desmond and McMahon.
Question declared carried.
Amendment declared lost.

: I move amendment No. 11:

In page 11, between lines 37 and 38, to insert:

"(2) The Registrar may, however, dispense with service under subsection (1) where the applicant satisfies him that it is not reasonably practicable to effect such service. In any such case, the Registrar shall serve notice of the application on every person who appears to him to be the owner of any estate, interest or incumbrance which would be extinguished by the issue of a certificate under section 22 (1), so far as it is reasonably practicable to ascertain such persons.".

Deputy O'Keeffe and others had a number of amendments on Committee Stage in regard to the difficulties faced by an intending purchaser under Part III who though, required by section 22 (1) to serve notice of his application on his immediate lessor, might have lost all contact with his landlord and might have paid no rent since before the foundation of the State. An amendment was moved to deal with the difficulty, and was accepted by the House, the effect of which was to add to section 22 (1) a provision that service of that notice may be effected in any manner provided for by section 63 of the Act of 1931 or section 23 of the 1967 Act. This makes it clear that service of the notice may be effected by sending the notice by registered post to the person to whom the rent is paid at the place of payment. However, Deputy O'Keeffe remained unconvinced that this amendment would be adequate to enable service of the notice to be effected in a case where rent had not been paid for many years and I undertook to re-examine the matter. The amendment before the House proposes a procedure for an intending purchaser who has failed after reasonable attempts to locate or identify his immediate lessor. I think this amendment will put beyond all doubt that a person in the situation described by Deputy O'Keeffe can avail himself of Part III of the purchase scheme.

The amendment, with drafting changes, is not dissimilar in substance from one of the Opposition amendments, which I have already mentioned, moved by Deputy Enright on Committee Stage. That amendment was intended to deal with much the same kind of situation. It enabled the Registrar of Titles to dispense from the requirement in section 21 (1) to serve notice on the immediate lessor in a case where the purchasing tenant cannot identify or locate the person to be served. Instead the Registrar of Titles is himself required to seek out the person or persons entitled to sell to the ground rent tenant so far as it is reasonably practicable to ascertain those persons before arbitrating on the purchase application and before the issue of any vesting certificate. This change will not, in effect, involve any work in the Land Registry since the Registrar of Titles is already required to seek out persons entitled to shares of the purchase money so far as they can reasonably be ascertained in connection with the distribution of that purchase money.

: I welcome this amendment. It certainly meets the point we made on Committee Stage. The Minister was, I think, satisfied that our point was a genuine one and related to the practical experience of both Deputy Enright and myself. This amendment seems to meet the position and so there is no opposition to it.

Amendment agreed to.

: I move amendment No. 12:

In page 12, line 15, after "dwellinghouse" to insert "(other than arrears an action for the recovery of which is statute-barred)"

Section 22 (2) requires the Registrar of Titles before issuing a vesting certificate to a purchaser under Part III to satisfy himself inter alia that the ground rent for the dwelling-house has been paid to date. On Committee Stage Deputy O'Keeffe argued against this requirement. The debate centred on the possibility that, if rent had not been paid or demanded for very many years, the purchaser might be required to pay all the arrears before getting his vesting certificate. I pointed out at the time that under the Statute of Limitations of 1957 at most six years arrears of rent would be payable. However, since Deputy O'Keeffe felt that the wording of section 22 (2) left room for doubt as to the applicability of the Statute of Limitations I undertook to look into the mater. The Statute of Limitations would, indeed, apply but the amendment now proposed is designed to put the matter beyond any doubt whatsoever.

: Again, I welcome this amendment but not with the same unqualified welcome I gave to the last amendment. I welcome it in so far as it accepts one of the two points I made on Committee Stage, namely, to ensure that a householder would not be required to pay rent going back beyond the statutory period when obtaining his vesting certificate; in other words, any rent which would otherwise have been statute barred would not be revived. The Minister's amendment covers that point entirely and to that extent I welcome it.

The other point relating to the establishment of the Registrar of Titles as a rent collector as it were was based on the principle of the registrar having an obligation placed on him to ensure the rent was paid up to date. The Minister has met me half way and we can take the amendment as acceptable.

Amendment agreed to.

: Amendment No. 13 is out of order.

: I had a communication from the Chair to that effect. Without questioning the Chair's decision in any way, I think I should say that the requirement to register would be related also to section 23 (3) which provides for fees to be fixed so as to meet the full cost of dealing with the relevant application except in relation to subsection (1). In other words, that subsection (1) of section 23 provided that fees would be a fixed sum in relation to an application under Part III but that any other fees that would also be fixed by the Minister would be fixed so as to meet the full cost of dealing with the application. In those circumstances, if there were to be an addition as I suggested in amendment No. 13 involving registration of the vesting certificate, one must couple that with the proviso as to fees in section 23 (3). I did not push the Minister to the extent of requiring, as it were, the registration fees to be paid but merely that the registration job would be done. So, with respect, I suggest that initially looking at my amendment you would take the view that it might involve a charge on revenue because there is a fee payable on registration—that is quite an understandable initial view—but if you couple it with section 23 (3) where there is provision that fees would be fixed to meet the full cost of the registration, that argument would not arise. I suggest that the Chair might look again at the amendment in the light of what I have said.

: The Chair had no option but to rule out the amendment. As I see it, it forms a potential charge on the revenue. The purpose of the amendment was to provide for registration of vesting certificates in the Registry of Deeds. Under existing enactments, a statutory fee of £4 must be paid for each such registration but the amendment provides that registration shall be completed by the registrar. Its effect is to make the charge payable by him. This involves a charge on the Revenue and such an amendment cannot under Standing Orders be moved by a Private Member. The Chair regrets that this decision is necessary.

: Perhaps we can raise it in a different way to preclude that possibility.

: Amendments Nos. 15, 16 and 17 are consequential on amendment No. 14 and these may be discussed together.

: I move amendment No. 14:

In page 13, line 50, to delete "the Housing Act, 1966" and substitute "statutory authority".

During the Committee Stage debate on 3 May as reported at columns 179-80 of the Official Report, Deputy O'Keeffe indicated that in his opinion it was not clear whether tenant purchasers of houses provided by local authorities prior to the enactment of the 1966 Housing Act would be entitled to acquire the fee simple in their dwellings. The 1966 Housing Act repealed all previous legislation enabling housing authorities to provide houses and it was considered in drafting section 26 that all houses provided under the earlier legislation could be deemed to have been provided under the 1966 Act. However, the position has been further examined and I am advised that it would be worth while to put the matter beyond all doubt by amending the section so as to give the right to acquire the fee simple to the owner of any house provided under the 1966 Housing Act or any Act repealed by that Act.

: I welcome this amendment which arises out of the Committee Stage discussion. I said then that I was worried about local authority householders who had entered into leases prior to 1966. The effect of this series of amendments is to remove entirely the doubt that was in my mind and to make it clear beyond all doubt that all local authority householders, whether their houses were vested by way of lease before or after the 1966 Act, will be able to take advantage of this Bill.

Amendment agreed to.

: I move amendment No. 15:

In page 14, line 14, to delete "the Housing Act, 1966" and substitute "statutory authority".

Amendment agreed to.

: I move amendment No. 16:

In page 14, line 33, to delete "the Housing Act, 1966" and substitute "statutory authority".

Amendment agreed to.

: I move amendment No. 17:

In page 14, between lines 35 and 36, to insert:

"(10) In this section ‘statutory authority' shall be construed as including the Housing Act, 1966, and any Act repealed by that Act.".

Amendment agreed to.
Bill received for final consideration.
Agreed to take the remaining Stage today.
Question: "That the Bill do now pass" put and agreed to.
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