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Seanad Éireann debate -
Tuesday, 6 Apr 1982

Vol. 97 No. 5

Housing (Private Rented Dwellings) Bill, 1982; Second Stage.

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

The second Bill before the Seanad today in the Housing (Private Rented Dwellings) Bill, 1982. This Bill provides permanent legislation for these rented dwellings previously controlled under the Rent Restrictions code. The Bill is broadly along the lines of the Housing (Private Rented Dwellings) Bill, 1981, but there are a number of important differences to take account of the latest decision of the Supreme Court and of certain amendments put down by me when the 1981 Bill was before the Dáil last December, including rent allowances to tenants for whom payment of the higher rents would create hardship.

This Bill arises out of a series of court decisions on the constitutionality of various laws relating to private rented residential accommodation. It is needed to ensure that tenants who were previously protected under the rent restrictions code are not left entirely to the mercy of market forces. It was suggested during last week's debate in the Dáil that perhaps the Bill was no longer as urgent as it previously was, since the temporary legislation protecting tenants is now being extended for a further period. This is not the case. As the Taoiseach pointed out in the Dáil, the temporary legislation provides no more that a fall back position to be used if necessary. In the last analysis, it would be very unwise to place total reliance on it.

As Senators will be aware, the temporary legislation is already under constitutional challenge in our courts and every extension of the legislation increases the possibility of it, too, being declared unconstitutional. Were this to happen, tenants would be placed in an impossible position with no obvious courses of action open to the Government to relieve their plight. Faced with that dark picture of what might happen, Senators will understand my anxiety that this Bill should be passed into law as soon as possible.

In their judgment of 19 February 1982 the Supreme Court declared section 9 of the Housing (Private Rented Dwellings) Bill, 1981, unconstitutional. That section provided for the phasing-in of rent increases allowable under the Bill over a five year period. The Supreme Court considered that the resultant depriving of the landlord of part of his just and proper rent for his property was an unjust attack on his property rights in contravention of Article 40.3 of the Constitution. Accordingly the President declined to sign the Bill. In the Dáil considerable time was devoted to this judgment and its implications. In this context we need to remember that, under the Constitution, the Supreme Court have a duty to ensure that legislation referred to them is in conformity with the Constitution. It is up to the Supreme Court and no other body, to make this judgment. The job of the Oireachtas in these circumstances is to enact legislation which is in conformity with the Constitution and its interpretation by the Supreme Court. This is what I have sought to do in this Bill and to achieve in it a proper balance of the rights of landlords and tenants.

In the Dáil particular attention was directed towards the new formula for the setting of gross rents in section 13 of the Bill. Some Deputies argued that there was a serious risk that the basis for determining the gross rent of a dwelling as set out in section 13 raised fundamental questions as to constitutionality of that section. I intend to address myself to this question here. It was suggested in the Dáil that the only conclusion which could be drawn from the Supreme Court's judgment was that the just and proper rent for a dwelling was a market rent. I do not think this is the only interpretation that can be taken from the judgment. The real objection of the Supreme Court was to the phasing-in of the just and proper rent over a number of years so depriving landlords of part of their proper return from their property. The Bill before the House allows for payment from the outset of the just and proper rent determined in accordance with the criteria specified in section 13 of the Bill. The advice available to the Government is that the provisions of section 13 are in conformity with the Constitution.

The other main issue that arose in the Dáil concerned the District Court being the proper forum to settle matters arising from the Bill. In the first place it was held that the volume of cases would be too great for the District Courts to accommodate; secondly, that the formality of the proceedings would inhibit and upset tenants or landlords not familiar with how the courts operate; thirdly, that the tenants and, in some instances, the landlords would be faced with considerable costs; and, finally, that an administrative tribunal with legal and technical personnel on it would be preferable to the District Court as a means of arbitration.

I would like to say at the outset that I share many of these concerns. The Bill is designed to overcome these difficulties in so far as it is possible in the time available to me. For example, a tenant's costs in connection with an application to the court by a landlord will normally be borne by the landlord. On the question of rent tribunals a clear commitment has been given by the Taoiseach and by myself in the Dáil to set up such tribunals. Discussions in this connection will take place with the Opposition parties, at whatever level is appropriate, after Easter, and legislation to set up the tribunals will be introduced in the next session. I want to emphasise that. Perhaps I should stress there is no disagreement between the parties about the desirability of setting up rent tribunals.

Senators must appreciate, however, that it would take some time before such tribunals could be fully functioning and could deal with the volume of cases that are likely to arise once the Bill becomes law. It is not simply a matter of having an enabling section in this Bill. Personnel have to be recruited and trained, procedures set up, accommodation obtained, the precise terms of reference of the tribunal determined and so on. There are also certain legal and constitutional difficulties to be sorted out. These problems are not insurmountable but they will take some time to resolve. In the meantime, the only realistic course is to use the District Court as the body to adjudicate on matters arising under this Bill.

On the other problems associated with the use of the courts, the Government are taking steps to avoid disruption to the courts system generally by the extra burden this Bill will put on the District Court. As I announced in the Dáil, the Government are appointing extra district justices in the Dublin area to deal with rent cases. With a view to making for a more informal and consequently a less intimidating atmosphere, these justices will sit in accommodation separate from existing court buildings. The Government will, of course, continue to monitor the situation in all parts of the country to ensure that the District Courts have the facilities to deal with the cases arising from this Bill.

If I may interrupt the Minister, Senator Murphy.

Debate adjourned.