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Dáil Éireann debate -
Thursday, 2 Oct 2003

Vol. 571 No. 3

Ceisteanna – Questions. - Property Transfers.

Kathleen Lynch

Question:

9 Ms Lynch asked the Minister for Education and Science the progress made to date with regard to his Department's consideration of the list of properties to be transferred by religious institutions to the State under the deed of indemnity signed on 5 June 2002, which was to have been completed by 30 April 2003; if the list of properties proposed to be transferred has been finalised; if any properties have been transferred; if any properties have been rejected; when it is proposed to publish the list; and if he will make a statement on the matter. [21508/03]

The indemnity agreement provided that the property contribution of the congregations was to be divided into two separate and distinct parts. One was property to be transferred from the congregations to the State, State agencies, local authorities or voluntary organisations after the date of the signing of the indemnity agreement on 5 June 2002. The value of these property transfers for the purposes of the indemnity agreement was to be €36.54 million.

The other part was property transferred from the congregations to the State, State agencies, local authorities or voluntary organisations between 11 May 1999 and the date of the signing of the indemnity agreement on 5 June 2002. The value of these property transfers for the purposes of the indemnity agreement was to be €40.32 million.

It is not the case however that the property aspect of the indemnity agreement was to be completed by 30 April 2003. Under the terms of the agreement signed on 5 June 2002 the State had a period of nine months to consider the properties offered by the religious congregations in respect of the "properties to be transferred" list.

On 5 March 2003, officials at the residential institutions redress unit of my Department requested a further period of two months to give further consideration to a number of the proper ties on offer. CORI agreed to this request. Following further examination of the properties on offer, officials at my Department informed CORI's legal representatives that the State was prepared in principle to accept a fee simple interest in 34 of the properties offered. These properties have been valued by the congregations at €22.6 million. As indicated previously, the target amount for this schedule is €36.54 million. Eight other properties were rejected on the basis that no benefit to the State could be identified by acquiring a title. Three properties are still under consideration.

Section 8 of the agreement states that in the event that the State party rejects a property offered, the religious congregation has the right to replace the property with an alternative property or cash sum equivalent. CORI has submitted a schedule of alternative properties which the congregations propose to offer the State in place of the properties it has declined. These are being considered by officials at my Department to establish if any benefit will accrue to the State by accepting them. My Department will respond to the offer of these properties in the near future.

As negotiations are ongoing and the issue is commercially sensitive, I do not intend giving details of the identity of the properties concerned at this stage. When agreement is reached, a list of the properties will be made available.

There is not a time limit of nine months on the schedule entitled "properties already transferred". Officials from my Department have sought additional information from CORI to ensure that each of these properties qualifies under the criteria laid down in the indemnity agreement regarding valuation, title and restriction on transfer for a 25 year period. To date none of the properties on this list has been accepted.

I share the Deputy's concern about having the property aspect of the indemnity agreement concluded as soon as possible. However, my paramount concern is that the State only accepts properties that will provide a material benefit. In addition to this I must ensure that properties the congregations maintain were transferred to the State, State bodies or voluntary organisations qualify in accordance with the terms of the indemnity agreement.

Will the Minister explain about the €22 million in property in which he said a fee simple interest was accepted in principle? Has he accepted the properties and does he consider them to be of value to the State? Will he proceed with their transfer and what does he consider will be the timescale?

The Minister said at the Committee on Education and Science that if he did not receive suitable properties up to the value, he could obtain the value in cash. Will he clarify whether he can do that under the terms of the deal? Is a timescale involved or can the congregations continue to offer properties during the nine months? Will the Minister clarify the position in this regard?

Regarding the 22 properties, all things being equal, in layman's terms we will accept those properties. We are carrying out due diligence to ensure that the titles are clear, there are no encumbrances and that no one else has a hold on the properties.

Section 8 of the indemnity deal states that in the event that the State rejects a property, the religious have the right to replace it with an alternative property or a cash sum equivalent. They have exercised that right, so it is one or the other. The indemnity agreement means that so long as both sides act in good faith, there is not much we can do except finalise negotiations.

If at some stage the State believes the congregations are not entering into the negotiations in good faith, for example, there is provision for us to go to an arbitrator. If they were to continue to provide properties that they knew were not acceptable, the State could go to arbitration. However, I am informed that from a legal viewpoint, we would want to be sure they were not serious. Nonetheless, we have that alternative and if at the end there is an insufficient number of properties to meet the sums of money agreed, we are entitled to the cash.

Is it not true that under the agreement the congregations can offer the State cash at any time but it cannot seek it unless there is bad faith.

Yes, but if they run out of properties—

They could go on for years with all the properties they have.

Section 13 of the indemnity agreement outlines the procedure regarding the changing of properties if the Minister is not satisfied with them. As Deputy O'Sullivan said, this could continue indefinitely. Section 16 of the agreement deals with disputes arising out of this deed, save those which arise under sections nine and 13. Does this not suggest that we do not have recourse to an arbitrator under section 13?

I do not think the Deputy is correct in that. It is not my understanding, which is that if there is a dispute it can go to arbitration. I will double check it for the Deputy.

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