Private Business. - Landlord and Tenant (Amendment) Bill, 1979: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

I am pleased to have the opportunity to address the Seanad on the Second Stage of this important piece of legislation. Senators will recall the passage, during 1978, of the two Landlord and Tenant Bills which became law as the Landlord and Tenant (Ground Rents) Act, 1978 and the Landlord and Tenant (Ground Rents) (No. 2) Act, 1978. The Bill now before the House represents the third and final instalment of a trilogy of measures to give effect to the Government's current proposals in the area of landlord and tenant law. This will bring about the modernisation and, in considerable measure, the consolidation of the post-1922 landlord and tenant code.

Assuming enactment of this Bill the code will consist of the three Ground Rents Acts, one of 1967 and two of 1978, the Landlord and Tenant (Amendment) Act, 1971, which deals mainly with sporting leases, and the present measure, and will collectively be cited as the Landlord and Tenant Acts, 1967-1979. Perhaps I should explain why the consolidation in a single enactment of this body of legislation is not just now being proposed. It would have been possible to bring in a Bill that provided for the repeal and re-enactment of all the Acts I have mentioned so that the post-1922 landlord and tenant code would be contained in a single measure. However, it is desirable that this Bill should reach the Statute Book without avoidable delay because of the urgency of one particular provision which I will deal with later. The consolidation of all the Landlord and Tenant Acts would have involved a very substantial Bill that would almost certainly have entailed much delay. Moreover, a single consolidated measure could perhaps be of somewhat limited value in the light of the circumstances that the Landlord and Tenant Commission are still sitting.

Almost all of the changes proposed in the Bill emerge from recommendations of the commission and they may have further recommendations for changes in these Acts in the not too distant future. This raises the possibility that further legislation may be necessary to bring to a conclusion the work of the commission in this area of the law. Even then it is to be anticipated that the commission will go on to deal with further items that fall within their terms of reference, that is, Deasy's Act, and may recommend changes in that area also. At that point the question would arise of having further legislation. Only then could we envisage the possibility of a full Landlord and Tenant Bill that would provide for the consolidation of all the statute law of landlord and tenant.

Senators will appreciate that this Bill is, by reason of its subject matter, necessarily one of considerable complexity even though care has been taken to frame the proposals in as straightforward a manner as possible. It might be useful at this stage, therefore, if I were to outline for the House, in a general way, the purpose of the measure and the background to it.

The purpose of this Bill is to up-date the Landlord and Tenant Act, 1931 and the Landlord and Tenant (Reversionary Leases) Act, 1958 on the basis of changes that have been recommended by the Landlord and Tenant Commission. Certain provisions of the Rent Restrictions Acts and of the 1963 Planning Act are also involved but only as a matter of consolidation. The subject matter of the Bill extends to two main areas, that is, the terms and conditions attaching to the renewal of occupational tenancies and to the award to a departing occupational tenant of compensation for improvements he may have made—this is the area covered by the Act of 1931—and the renewal of ground rent leases—this is the area covered by the Act of 1958.

As to the general background, the Act of 1931 was of course a landmark in the regulation of the relations between landlords and tenants. The terms "landlord" and "tenant" have certain unpleasant historical connotations in Ireland and, indeed, for much of the last century and the earlier part of this century this particular social area was one of bitter acrimony. Thankfully, this is now a thing of the past and the change was due, in no small measure, to the 1931 Act which it is proposed in this Bill to up-date and amend. The 1931 Act effectively set the pattern for the statutory regulation of relations between urban landlords and tenants by recognising for the first time the right of an urban tenant to be protected against dispossession on the expiration of his tenancy. It conferred on such tenants the right to a renewal of their tenancies. In the context of landlord and tenant legislation such a renewed tenancy is referred to as a "new tenancy" where an occupational tenancy is concerned. Where the renewal is the renewal of a ground rent lease the renewed lease is referred to as a "reversionary lease".

Prior to the 1931 Act, an urban tenant whose lease expired had no legal right to remain on in the property and the landlord was entitled to recover possession even where the tenant had constructed the buildings himself, that is to say, even where a ground rent lease was involved. The Landlord and Tenant (Reversionary Leases) Act, 1958 extended the rights of tenants in the type of case where the the tenant had constructed the buildings himself or had otherwise paid for the buildings.

Before going further, perhaps I should clarify some of the other terms that fall to be used in this discussion. An "occupational tenancy", which may arise by way of a lease or any other form of agreement, is one where the landlord owns the "bricks and mortar" interest, for example, a tenancy of a business premises or of a shop. The tenant's interest is related primarily to his occupation of the premises. The rent charged in such cases is, of course, higher than a ground rent and is commonly called an "occupational rent". The other kinds of tenancies with which this Bill is concerned could be grouped together under the generic description of "ground rent tenancies". The rent charged—a "ground rent"—is lower than an occupational rent and reflects the fact that the "bricks and mortar" interest in these cases belongs to the tenant. The 1931 and 1958 Acts identified ground rent leases under the categories of "building lease" and "proprietary lease". A "building lease" in its simplest form is a lease under which the landlord leases the tenant a plot of land with a covenant in the lease that the tenant will build a house on the land.

A "proprietary lease" is a sub-lease under a building lease. The Act of 1958 had already identified so many different categories of "building lease" that these categories had become somewhat unwieldy even before a number of new kinds of "building lease" were identified by the Landlord and Tenant Commission. The 1978 No. 2 Ground Rents Act has already extended the right to purchase the fee simple to the lessees under all such leases, and has done so under a much simplified classification. This gives the opportunity, which is taken in this Bill, of simplifying also the law relating to the grant of a reversionary lease—that is, a renewed building or proprietary lease—as at present contained in the Acts of 1958 and 1971, and of getting rid of the expressions "building lease" and "proprietary lease" which have out-lived their usefulness.

I now turn to the main changes in the law which are being proposed in this Bill and which, as I have indicated, stem for the most part from recommendations of the Landlord and Tenant Commission. Senators will readily appreciate that this is very much a Committee Stage Bill and will, I am sure, excuse me if I do not go into great detail in regard to the various proposals on this Stage of the Bill. This Bill runs to no less than 82 sections. They deal with a great number of separate issues—many of them of a technical detailed nature. I would, perhaps, be trespassing on the time of the House if I were to attempt to describe the Bill section by section, or even to deal with each Part in any considerable detail. I will, of course, be only too willing to elaborate on any particular points which Senators may raise.

I will deal first with the proposed changes in the law in Parts I, II and IV of the Bill which are of concern to occupational tenants, that is, those who do not own the "bricks and mortar". The right to a new tenancy is being given to business—or part-business—tenants of three years' standing in all cases, regardless of the term for which the existing tenancy was granted and this right will apply even where there has been an unplanned temporary break in business use during the three years if the court considers it reasonable to disregard that break. At present, business tenants who hold on less than a yearly tenancy, or than a lease for at least one year, must show not only three years' continuous business use immediately prior to the termination of their existing tenancies but also continuous occupation during the seven years preceding that termination, in order to have the right to a new tenancy. Moreover, the provisions of the law as it stands make no allowance for any break in business use during the qualifying period.

The other type of occupational tenant is, of course, the tenant of living accommodation, and a further change proposed in the Bill is that an occupational tenant is being given the right to a new tenancy of a dwelling after 20 years' continuous occupation by himself or by his predecessors in title. At present there must be 30 years' continuous accupation without any sale of the tenant's interest during that period. In addition, provisions are being included to ensure that a tenant will not inadvertently lose the right to a new tenancy through failure to claim that new tenancy within the time-limits provided: the onus will be on the landlord to give notice of the termination of the previous tenancy and the tenant's right to claim a new tenancy will survive until after that notice has been given.

I should now like to refer to what is perhaps the most important single area of change that is proposed in the Bill, that is, in relation to the terms on which a new tenancy will be granted where those terms fall to be fixed by the court in the absence of agreement between the parties. At present, where the court fixes the terms of a new tenancy, that tenancy is normally for a 21-year term; under the Bill it will be for 35 years unless the tenant opts for a shorter term. In addition, the rent on renewal will, under the Bill, be subject to review at the instance of either the landlord or the tenant at intervals of five years instead of remaining unaltered throughout the term of the new tenancy. The Landlord and Tenant Commission recommended the introduction of rent reviews at seven-year intervals to cater for the inflationary situation and the longer terms now proposed. Reviews at intervals of five years or even less are, however, much more usual in tenancies currently negotiated between tenants and landlords and, hence, reviews at intervals of five years are proposed in the Bill.

Senators who are familiar with this field will be aware that the present state of the law in this area is satisfactory neither to landlord nor to tenant. The decision of the Supreme Court given in 1977 in the case of Byrne v. Loftus means, in effect, that while the tenant can obtain the grant of a new tenancy for a 21-year term at a fixed rent, that rent may nevertheless be very high at the time it is fixed. It is higher, and it may be very much higher, than it would be under a tenancy that provided for reviews of the rent at regular intervals and, accordingly, that fixed rent may represent a real burden on the tenant. The need for a change here is an important reason for pressing ahead with this Bill in the form in which it is before the House, that is, without proposing in this Bill the consolidation of all the Landlord and Tenant Acts.

A further change that is proposed relates to the time when a new tenancy may be obtained. Under the 1931 Act the right to a new tenancy can arise only in or about the time of termination of the previous tenancy. It is now proposed that a new tenancy may be claimed and granted as soon as the necessary conditions are satisfied, although the new tenancy is not to commence until the existing tenancy has terminated. This should have important benefits in terms of security of tenure.

Other proposals, in Part IV of the Bill, concern changes in the law relating to the procedure to be followed where a tenant wishes to carry out improvements and where he is to qualify for compensation for those improvements in the event that he is leaving when his tenancy terminates. At present an occupational tenant is not entitled to such compensation where he has failed to serve an improvement notice on his landlord. The Bill proposes that compensation be allowed even where that notice has not been served, provided certain conditions are satisfied, of which the one I may mention is a condition that the landlord has not been prejudiced by non-service. It is also proposed that a tenant should be empowered to carry out improvements, even where the landlord objects, except where the landlord is due to recover possession of the premises within the following five years.

Changes of a more or less technical nature that are proposed in Part I of the Bill will extend the right to a new occupational tenancy to Government Departments, charities, sporting or cultural organisations and to business tenants of housing authorities, and will make it clear that that right extends also to local authorities as tenants.

Part IV of the Bill includes—in section 60—a proposal for a new kind of provision in the public interest, in the wider sense, rather than in relief of tenants. This is a proposal to enable a landlord, subject to certain rather stringent conditions, to terminate an occupational tenancy so as to regain possession, before the lease expires, of buildings that are obsolete or are in an obsolete area. The Landlord and Tenant Commission in their first report describe the situation which sometimes arises when a sitting tenant will not give up possession except for exorbitant compensation or cannot be induced to move at all. In this way he can hold up redevelopment or reconstruction schemes for whole areas. The Bill proposes to allow the court to make an order terminating a tenancy in a case like this. It also provides very stringent safeguards for the tenant. First of all, it must be reasonable to make the order terminating the tenancy. In addition, the relevant tenancy must have not less than three years and not more than 25 years to run. Compensation must be paid for loss of the tenancy and for any further hardship to the tenant. The tenant is to be paid a share of the financial benefit that accrues to the landlord from obtaining possession of the property. At least six months' notice of termination must be given to the tenant and every termination order would be subject to a stay of one year. In every case the landlord will be required to have a development scheme that includes the property and for which planning permission has been granted and either the buildings themselves must be obsolete or they must be in an obsolete area as defined in the 1963 Planning Act.

I have been dealing with the changes in relation to occupational tenancies that are proposed in Parts I, II and IV of the Bill. I should now like to deal with the changes in Part III. Part III of the Bill concerns reversionary leases, that is, the area of the law at present covered in the main by the Landlord and Tenant (Reversionary Leases) Act, 1958. The proposals in Part III of the Bill involve two main changes in this area of the law. The right to a reversionary lease is being extended to all classes of ground rent lessees who have the right to purchase the fee simple under the 1978 No. 2 Ground Rents Act. This includes not only the classes of lessees who have that right under the Acts of 1958 and 1971 but also the additional classes of lessees who are given the right to purchase the fee simple by the Ground Rents Acts of 1967 and 1978. It is true that the creation of future ground rent leases on dwellinghouses is, in effect, prohibited by what I may call the No. 1 Ground Rents Act of 1978 and it might be considered by some to be inconsistent with the general purpose of that legislation to enable ground rent tenants to renew their expiring ground rent leases, be they either the newly-recognised classes of ground rent lessees or be they those ground rent lessees who already have that right under the Act of 1958. However, if ground rent lessees have not the right to a reversionary lease they are effectually in the position of being forced to buy out their ground rents and their freedom of action is taken away from them. It was never the intention that ground rent legislation should manoeuvre tenants into the position of being forced to exercise their rights of purchase. Moreover, it would be both invidious and unfair to seek to remove the right to a reversionary lease from those classes of lessees who under the Acts of 1958 and 1971 already have that right. In consequence, the Bill proposes the preservation and the extension in scope of the right to a reversionary lease in the manner I have described.

The second main change is one on which I have already touched, namely, that the expressions "building lease" and "proprietary lease" are being dropped from the law and are being replaced in Part III of the Bill by reference to the simplified classes of ground rent lessees that are set out in the 1978 (No. 2) Ground Rents Act.

Certain other changes are proposed in relation to the grant of a reversionary lease, of which the following may be mentioned. The rent to be reserved by the reversionary lease will be determined with due allowance for any improvements that may have been made by the lessee. Furthermore, the refusal of a reversionary lease by a landlord on the grounds that he has rebuilding or development plans will not be upheld by the court unless the landlord has obtained planning permission for the work—this parallels a similar change that is proposed where the refusal of a renewed occupational tenancy is in question. Finally, an applicant for a reversionary lease is no longer being required either to obtain the consent of any under lessees who also have the right to a reversionary lease or to exclude from his application the lands comprised in any such under leases.

Part V of the Bill re-enacts with drafting changes the provisions in Part VI of the Landlord and Tenant Act, 1931, which provide certain reliefs for tenants against covenants in leases of tenements. The expression "tenement" is defined in section 5 of the Bill.

Part VI includes, in section 69, a provision that may be regarded as completing the work of the No. 2 Ground Rents Act of 1978 by giving to ground rent tenants of the State the right to buy out the fee simple of their dwellinghouses under the purchase scheme provided by that Act, subject only to the public interest. The same right is also being given to ground rent tenants who hold under leases given by a harbour authority or by the Commissioners of Irish Lights and who have not that right under the law as it stands. Ground rents on dwellinghouses held from the State or from the other bodies I have mentioned did present a difficulty at the time last year's ground rents legislation was in progress, and the Minister for Justice expressed his intention at that time of finding an acceptable solution. When I myself last spoke in this House on the question I promised the House that the matter would be considered in connection with the Bill that is now before it. What the Bill proposes is that ground rent tenants who hold their dwellinghouses from the State, or from one of the other bodies I have mentioned, shall have the right to buy out the fee simple except where the State authority concerned are satisfied that acquisition of the fee simple by the ground rent tenant would not in a particular case be in the public interest, and where the State authority certifies accordingly.

One other change that I should mention is that, while the Landlord and Tenant Act of 1931 is being repealed in full, section 60 of that Act is not being re-enacted. Section 60 of the 1931 Act provides for the grant of long leases of building ground in urban areas in certain circumstances. The section is highly complicated and the terms of any lease that might be granted under its provisions are uncertain. Moreover, its provisions do nothing to protect the security of tenants and they are something of an oddity in the landlord and tenant code. In fact, section 60 has never been operated and its non-re-enactment will remove an unused provision from the law.

The foregoing are the main changes that the Bill proposes. A number of lesser changes are also proposed and it will be appropriate to deal with these as they arise on Committee Stage. As I have mentioned, most of the changes stem from recommendations of the Landlord and Tenant Commission and I would be remiss if I did not here pay tribute to the painstaking work of the members of the commission. In particular, I should like to record a special tribute to Mr. Justice Conroy, chairman of the commission, for his diligent work as chairman of a series of commissions dealing with landlord and tenant law. The commission are, as I indicated earlier, still engaged in an examination of certain aspects of the post-1922 landlord and tenant code and following that they will, I expect, go on to review both the non-statutory and statutory provisions of landlord and tenant law which pre-date the foundation of the State. I look forward to a successful conclusion to the commission's work with the prospect in due course of a major Bill which will propose a comprehensive, modern code of landlord and tenant law.

I commend the Bill to the House.

I, too, should like to pay tribute to the work of the Landlord and Tenant Commission under the chairmanship of Mr. Justice Conroy. Anybody who has to study landlord and tenant law finds out very quickly that it is a most complex and difficult area. Because of developments in business life and in ordinary social life it becomes necessary from time to time to amend our laws or to bring in new legislation and, as a result, we now have quite a number of Landlord and Tenant Acts. When one wants to consider a Bill of this nature it is a difficult task to go through all the Acts.

In so far as the Bill is a consolidating measure—and it only consolidates two existing Acts—I welcome it. Any move to consolidate in this area is a good one. But for the dedication of the members of the Landlord and Tenant Commission the preparation of legislation of this nature would not be possible. When the Minister complimented the commission I was mildly surprised that he did not pay some tribute to the previous Minister for Justice who, of course, was responsible for drafting the measure.

I will deal with that later.

I thank the Minister. What we have here is the guts, if I may use that word, of the 1977 Landlord and Tenant Bill that died with the Coalition Government. It has a new appearance now, a Fianna Fáil flavour, so to speak, because we have removed from it the ground rent legislation that was brought in separately last year. We also have one very minor change that I notice, that is, the provision for five-yearly rent reviews, whereas the 1977 Landlord and Tenant Bill provided for seven-yearly rent reviews. I realise that that has been necessary because of inflation. Other than that there has not been any major change in the Bill.

We foresee no difficulties then about the passage of the Bill.

I will deal with that as we go on. I noticed in the Minister's speech a slight change in stance on Fianna Fáil's election promise to abolish ground rents. He said, "It was never the intention that ground rents legislation should manoeuvre tenants into the position of being forced to exercise their rights of purchase". If I remember correctly—and it may not be fair of me to mention this to the Minister because Deputy Brian Lenihan, the Minister for Fisheries and Forestry, was present during the debate on the No. 2 Bill—the intention was to abolish ground rents. Moreover, it was felt that by providing the machinery about 500 applications a week would be processed and dealt with by the authorities and that after two years there would be no more ground rents left in the country. I should be grateful if the Minister would let us know how many applications have been dealt with under that legislation so that we can judge the success of the Government's intention to abolish ground rents.

I would agree with the Minister that this is a complex Bill, that it is basically a Bill to be dealt with on Committee Stage. I do hope that we will be allowed sufficient time to consider it because it would require about half-a-dozen readings before one would begin to get the feel of it let alone understand the legal ramifications of every section in it.

Those people who have read the report on occupational tenancies published by the Landlord and Tenant Commission will see that the changes in the law are basically those recommended by that commission. They are very welcome changes in that they not only bring laws together but also update laws that have been out of date for some years.

The most important proposals in this Bill are those relating to what are generally known as business leases and what are known in this context as occupational tenancies. For some time the courts have had difficulty in setting new rents for the occupational leases. In this respect the Bill is very welcome indeed. I know of many people who have found it very difficult to adjust to a rent fixed by the court. The rent fixed by the court was more than the current market rent at the time but the court had to add to the market rent a premium to compensate the landlord for his lack of opportunity to have another rent review for 21 years. I welcome that very much.

I notice with interest that the Minister said that this was the reason the Bill was introduced at this stage. I would draw his attention to the fact that this proposal was in the Bill published by the previous Government and could easily have been introduced in either of the Landlord and Tenant Bills that passed through his House last year. It would not have met with any opposition from us. However, it is as well that the previous Bill has been left more or less as it was. The changes in it can only be dealt with on Committee Stage.

I also welcome the provision to relax the qualifying conditions for a new tenancy. In the past many landlords let properties to tenants for two years and nine months. Before giving a new lease they had their premises vacated for a while and tried all sorts of gimmicks in order to leave their premises free. Landlords should decide whether or not to use their properties as investments. If a tenant is to have a fair crack of the whip that decision must be made. The temptation has been there for solicitors and barristers to try to find ways around the problem. That is what they are paid for and they would not be discharging their responsibilities if they did not try to do that. I welcome the relaxation of the conditions because it will make the law more sensible.

Another provision which I welcome is the proposal to extend new business leases from 21 years to a maximum of 35 years in the event of the landlord not wanting it longer, or of the parties not agreeing to having it longer. It provides better security for the tenant who might want to borrow money on the strength of his title. It also allows five-yearly rent reviews for landlords, which keeps them happy. It is also sensible that the court, if the parties agree, can grant a longer lease. It is a practical way of looking at the law.

Another sensible provision in the Bill provides for the court to make an order, on the granting of a new tenancy, that the tenant should carry out repairs to the building, specifying the time within which repairs are to be carried out. That is a sensible provision and it up-dates the law where it badly needs up-dating. Perhaps the best provision of all is the right given to the court to insert conditions in a new tenancy that it deems appropriate where the parties cannot agree. Obviously, if the parties can agree there is no problem. Where the parties cannot agree the court would now have, presumably on application by one of the parties, the right to insert conditions in a new lease. If one has a long lease, a 21 year lease, and one applies to the court for a new lease under the provisions of this Bill, the conditions of the neighbourhood and the conditions of the landlord's adjoining premises may have changed substantially. It is only reasonable that the landlord or the tenant should be able to ask the court to impose conditions and, if the court considers them appropriate, to insert them, despite the absence of agreement between landlord and tenant.

There is not a great deal one can say about reversionary leases. I look forward to studying them in greater depth. I welcome the abolition of the expressions "building lessee" and "proprietary lessee". I think that is sensible, although the categories will remain. It is sensible to include all tenants who have the right to buy out their ground rents under section 2 of the 1978 Act.

In general, I give the Bill a warm welcome. I ask for plenty of time to consider it. If it were possible, I should like Committee Stage to be broken up over a few weeks so that we could take it bit by bit. I imagine that by the time we are finished with this Bill we will all be fed up with landlord and tenant law for a while.

Senator Molony took the words out of my mouth, which suggests that he was cogging my notes, because I intended to open with the suggestion that the way to deal with this Bill might be to agree to take Committee Stage in stages, if possible, to get a division of it. I do not think it is all that formidable. There are some debatable items but once we clear these, we shall probably spend a good deal of time looking at the text, because this is really what we are trying to do here. Perhaps we could take away reversionary leases as a separate theme. My thinking is that it is a separate theme from a right to a new tenancy. I annex again in my mind the compensation part to the new tenancy provisions rather than to the other. Perhaps we will not be able to do that and will have to plough along in the usual way.

It is splendid that we have such ample opportunity to disagree on everything as we are all accusing each other of having drafted the document, which means that there cannot be any possible discredit to anyone accepting a proposal from the other side, assuming that the other side is going to contribute to the debate. Their numbers, if they become voluble on this matter, would be very useful. There is a lot of work to do on this. I have not done the exercise of seeing whether this Bill is like the other one. I am not concerned with that. When the history of life comes to be written all that will be established. I am looking at what I think are important changes. I did mark off on the explanatory memorandum, which is a great deal easier to read than the Bill, what seemed to be the most important things.

There are one or two things worthy of consideration. Section 4 lifts the burden of tenant rights from the State authority. If it has been changed since the 1931 Act I could not find it. It did not seem to be in the 1931 Act and I do not remember having come across it in practice, so I presume it to be new law. It does raise a big question of principle for us to consider. It is odd enough to find that in a Bill which, at the same time, confers on business tenants the right to get new tenancies in the case of housing authorities having leased these premises to them, which they did not have under the previous code. Is somebody somewhere taking an easy way out for the State in regard to this?

The theory behind the whole 1931 Act was to prevent tenants being screwed by having tied themselves up in a particular premises and attached their work and activity to these premises so that their work could be used as an exploitative element by the landlord to get something more from the tenant. Initially, the tenant would pay a rack rent for what he occupied but would not pay more than a rack rent for what he occupied. The language which was used in the 1931 Act was not precisely that. The 1931 Act did not work that way. When the courts granted new tenancies they tended to strike middle figures for the tenancies. When the landlord's valuer came in swearing one figure and the tenant's valuer came in swearing another, the court hit something in between.

For a period I used to work on the rule of thumb that when you got a new lease the rent would be about 25 per cent off the rack rent. That was not the original intention of it. If the original intention of the code is maintained—the original intention was to prevent exploitation by the landlord but to leave the tenant to pay the proper remuneration for the landlord's capital which he is occupying—why should the tenant of a State authority not be prevented from exploitation every bit as much as the tenant of anybody else? Why should somebody who works away for years on what happens to be the property of the State be at the mercy of the State machine? Why should he not get as many rights as he would get against any other landlord? Why should the State be allowed to be sloppy in the conduct of its business? If it does not want to create rights why should life be made easier for the officials in whatever body it is that looks after this—probably the Board of Works? Why should they not have to be as careful with State property as fellows employed by property companies are with theirs?

We may be talking about a fairly substantial amount of property. I do not know how extensive an estate the State has. We do not have any information on it. It might be useful to know on Committee Stage what kind of total valuation we are talking about, how extensive is the property and what might be involved. Half the GNP is now spent by the public sector, which includes local authorities, semi-State bodies and so on. The size of it suggests that there may be many interests affected by our getting the principle right.

The language used in the old section did not work out as the market value. It is proposed to improve that section by being able to look at like buildings in comparable areas. What is wrong with the market value if the idea is that there should be a prevention of exploitation of the tenant's position? If we are simply looking for the market value of the premises, surely it will lead to more rational investment of resources by the economy generally if any resources put into these investments get properly remunerated.

Connected with that point is the housing equity, the continuous 30 years' occupation. I never really understood why that should be so. I have come across quite a few cases where it was not the tenant that was the poor man; on the contrary, the only cases I know where the right was there are very well-off tenants and very poorly-off landlords. I just wonder what we are doing cutting down he 30 years to 20 years and what we are doing by not making it continuous occupation by a family but by letting it be transferred. I know this is recommended by the commission. Is there any survey of this at all by anybody? We are not talking about small tenancies, we are talking about substantial tenancies. It becomes a little dangerous when we are cutting out the restriction to the urban areas. A lot of people have been advised by their solicitors over the last 40 to 50 years and told, "It is OK. You can make favourable tenancy arrangements with your sister-in-law, your nephew's widow or anyone else. You are all right because they will never get rights as it is in the country".

Now that the position is to be changed and we may find lots of situations where tenants are going to have rights conferred on them. I know it is possible for the Minister to come back and say that it is open to the landlord to look for a review. That may not be the solution to the problem, particularly in a country situation. It may not altogether be in a country situation. It may not be a question of getting a return. Where we are extending rights and conferring new rights, which is what we are doing here, not merely changing the nature of the right within the city but conferring new rights on people who at the moment do not have them, it is important to ask ourselves if there is justification for this. I would like to feel that we gave consideration to these matters.

On the landing subsidiary and ancillary, I wonder how this was previously restricted to one acre positions in this city, to urban areas, if I remember correctly. Am I wrong in that? I can tell you in this city there is one very substantial building on lands that were very doubtfully subsidiary and ancillary but the unfortunate lessor had to decide that they were. Somebody who was originally a rack-renting fully occupying tenant ended up with a couple of hundred thousand pounds in his pocket. Having gone into occupation as a rack-renting tenant he collected the loot. We ought to consider quite thoroughly the implications of these things and their impact on problems connected with the re-development of places like Dublin. We should give thought to the question of whether or not we should in certain cases give power to the local authority if empowered to do so. In our approach to this Bill, can we do anything with it that would facilitate the reconstruction or the re-development of Dublin and remove obstacles in so far as we can? Property has its rights, certainly, but they should be regulated to the common good that we are supposed to be serving. We shall have great fun when we are discussing the Bill section by section—all 82 of them. I join with Senator Molony in his request that we be given some time when we are going through it, particularly between Committee and Report Stages.

I agree with Senators Molony and FitzGerald. It is true that this is an 82-section Bill. I think we should follow whatever arrangements Senators wish to come to, to have an efficient approach to the business before us. Perhaps the Whips might arrange it. We could take it Part by Part or associate one Part with another. At the end of 82 sections we might have forgotten what the first ten sections were about. It is that sort of Bill. I would be delighted to come to whatever arrangement the House finds satisfactory. Senator Molony very fairly admits that it was necessary for him to read the part dealing with reversionary leases three or four times before he came to grips with it. I think that is a fair point. It is an area of the law that is not my strongest point. I will concede that to Senator Molony on the basis of his concession.

There is one other matter. I would just like to clear the air as we are dealing with the Bill in a very friendly and a very civilised fashion, an attitude one would expect in the Seanad. I would like to concede that the former Minister for Justice had a hand in drafting this legislation. I do not want to gainsay that or deny his entitlement in that regard. I wish to put that on the record of the House. As the House knows, I have a personal regard for the former Minister for Justice and I expressed on another occasion my sorrow that he lost his seat in the Dáil and I repeat it on this occasion. I mean that sincerely. I do not know whether he came from a worse place to a better place.

His successor in office, the present Minister for Justice, Deputy Collins, must take the greatest credit, in all the circumstances—the complexity of the Bill, the number of sections in it—for bringing the Bill to the House so quickly and discharging the promise in the Fianna Fáil manifesto for the last general election. This is the third part of a trilogy and, in that regard, the Government can be justly proud in regard to the promise they made under the heading of the landlord and tenant code.

The other point that Senator Molony mentioned was the number of applications processed. Almost 10,000 inquiries have been received about the No. 2 Ground Rents Act purchase scheme. Over 600 purchases have been completed and over 1,000 purchases are being processed at present. This is a first class indication of how this legislation has worked, is working and will continue to work for the betterment of those people who have applied themselves to obtaining their entitlements under it.

It is proper that I should repeat that there is in existence this legal mechanism available to people to buy out their ground rents at a reasonable amount and buy in the fee simple. This is to be highlighted repeatedly during the currency of the term in which they can buy out that particular ground rent. Coming near the end of the time in which this right to purchase exists, I imagine the Department of Justice would remind the people, by advertisement, of their right under the Act, to ensure that the Act is seen to work. This may well be outside the scope of the Bill but it is a fair point. I have no reason to be inflexible in dealing with matters not directly related to what we are discussing, if it is helpful to Senator Molony. I should also like to be helpful in regard to whatever views he may have on Committee Stage.

I take Senator FitzGerald's point very well in regard to section 4 of the Landlord and Tenant Bill. I shall deal with it in greater depth and detail on Committee Stage. One of the first questions I asked my advisers was on the efficacy of section 4 of the Bill; they were quite satisfied that it was efficacious and proper, and I should remind the Senators who contributed that this particular section has been lifted directly from "your own Bill", consequently there is nothing new there. We have taken that directly from the former Minister for Justice's proposals.

My withers are unwrung.

I do not know if that makes it any better or any worse; it is the reality and the history of it. I do not think section 4 is in the interests of landlordism specifically; it is only incidental to the State as landlord. If, indeed, Senator FitzGerald raises any cases with me on Committee Stage which indicate the exploitation by the State of any of their tenants, I should be glad to have these cases examined. My advice to date is that there have been no cases of actual exploitation brought to the notice of the Department or Departments concerned.

Save your breath to cool your porridge.

The philosophy of the State involving itself as a landlord is a very wide question. The Senator approached it in a philosophical fashion. If he wishes to raise any specific cases of exploitation on Committee Stage, I should be delighted to deal with them.

The abolition of the urban and rural distinction, was a suggestion from that estimable body, the Landlord and Tenant Commission. I should like to make the point that whilst the Landlord and Tenant Commission is presided over by a judge of the Circuit Court, His Honour Judge Conroy, it is made up of personnel who are not directly related to the law.

The redevelopment of Dublin will, no doubt, be raised on Committee Stage and I should be interested to hear what Senator FitzGerald will say specifically on that aspect. I am grateful to the Senators for meeting the Second Reading in the fashion in which they did. Once more I should like to say that, in the interest of the proper expedition and disposal of the Bill and to give it legal purity—to make it as legally pure as human kind can make it—we would certainly accede to the Senators' request to introduce discussion on Committee Stage in a piecemeal fashion. I should like to have this Bill sent to the Dáil as quickly as possible and the best way to bring that about is to accede to the Senators' request. In that way we shall all get on well together and produce, in the not too distant future, a very good Bill for the Dáil and, consequently, for the signature of the President.

Question put and agreed to.
Committee Stage ordered for Wednesday, 28 March 1979.