Property Services (Regulation) Bill 2009: Report and Final Stages

Is mian liom fáilte a chur roimh an Aire, an Teachta Dermot Ahern. Before we commence, I remind Senators that a Senator may speak only once on Report Stage, except for the proposer of an amendment who may reply to the discussion on the amendment. On Report Stage each amendment must be seconded. It is proposed to group the following amendments for the purposes of debate: amendments Nos. 2 and 3; amendments Nos. 4 and 5; amendments Nos. 6 to 13, inclusive; amendments Nos. 15 and 16; and amendments Nos. 17 and 18. All other amendments which are not grouped will be discussed individually.

Government amendment No. 1:
In page 15, line 38, to delete ", Equality".

This technical amendment has been proposed to reflect recent changes in ministerial and departmental responsibilities. It involves the removal of the word "Equality" from the Minister's title so that it now reads "Minister for Justice and Law Reform".

Amendment agreed to.

I acknowledge that amendment No. 2, which is a Government amendment, has also been tabled by the Labour Party.

Government amendment No. 2:
In page 22, line 35, before "3 shall be" to insert "not more than".

On Committee Stage, I tabled an amendment to section 10 proposing that three members of the property services regulatory authority "shall be persons who, in the opinion of the Minister, are representatives of persons who provide property services", such as auctioneers, letting agents and property management service providers. During subsequent discussions on the amendment, it was suggested that it would be appropriate to provide that "not more than" three members of the authority could be representatives of the property services sector, in order to avoid a situation arising in which the sector being regulated would be over-represented. I indicated I was prepared to return to the House on Report Stage with an appropriate proposal. Amendment No. 2, which mirrors the text of the amendment tabled by the Labour Party, makes the required change to section 10. As I said on Committee Stage, I am not in favour of being too prescriptive about the composition of the boards. It can make a Minister's task of appointing a competent board much more difficult and become an obstacle to achieving the necessary gender balance.

Section 10(3) already provides that in making appointments to the authority, the Minister shall have regard to their having knowledge or experience in consumer affairs, business, finance, management or administration or any other subject which would be of assistance to the authority in performing its functions. I am not in favour of professional consumer representatives in this regard. We are all consumers of goods and services. Most Members will have used a property service at some stage when buying a property or renting accommodation. It is not a specialised skill. The Bill's provisions are sufficient to ensure the appointment of a high calibre authority in due course.

I thank the Minister for accepting amendment No. 2 which arose from Committee Stage deliberations. It had become apparent that section 10, which provides for the property services regulatory authority membership, would have allowed it to be dominated by property service provider professionals. The section's wording was, therefore, flawed. This amendment will mark a great improvement for consumer protection in ensuring not more than three members of the authority shall be representatives of those providing property services. It will also ensure the authority's independence in this regard which is what the Minister intended.

There was some debate on Committee Stage regarding the provisions around amendment No. 3. Notwithstanding the Minister's objection to it, it is important that it is specified that at least three members of the authority should be consumer interest representatives. I accept his point that all sorts can claim to be consumer interest representatives, as indeed all sorts could claim to be representatives of those who provide property services. Given the Bill's aim to ensure greater consumer protection in this unregulated area, it would be useful to be more specific about the numbers of those on the 11-member authority who would specifically represent consumers' interests. I accept there is some reference to consumer affairs in section 10(3) but this amendment would strengthen consumer protection.

Having experience over several years of appointing people to boards, when one is ticking all the boxes on gender representation balance, it is something of an onerous task. This is especially the case when getting nominations from various groups who do not necessarily put forward a gender balanced nomination, leaving it up to the Minister to ensure the gender balance of a board's membership. Much of the employer-employee relationship legislation requires representatives from trade unions and employers' groups on various boards. When one gets the nominations from these groups, as I said on Committee Stage, the Minister has to rebalance the board to tick the correct boxes on gender balance.

I accept Senator Bacik's point on highlighting the requirement for representatives with experience in consumer affairs. It was suggested on Committee Stage that there should be a specific requirement for representatives of consumer interests. Virtually everyone has had some dealings with the services to be regulated under this legislation. Any person off the street, therefore, would be able to represent consumer affairs in that respect. If one picks one over the other, in this case property services providers, will it imbalance representation?

I am desirous to have consumers' interests represented as much as possible. I will examine it again before it goes to the Dáil to see if the section can be tweaked to highlight consumer affairs. My experience, however, is that when one is picking a board it is better to have people on it with no vested interests because one might get a better overview. Having said that, when dealing with specialised legislation, one cannot pick anyone off the street to be an authority member. They need to have some experience and knowledge in the area concerned or else the board will become ineffectual.

I am glad the Minister will examine this again. The formula used in amendment No. 3 was trying to follow the Minister's wording in section 10(4)(a). That is why I used the wording, “in the opinion of the Minister, [these people would be] representatives of the interests of consumers”. I believed this gave the desired degree of flexibility in this regard. I accept there may be all sorts who may claim to represent the interests of consumers, so there must be some criteria for judging whether they do.

Another formula would be to use the model of section 10(5) which affords the Minister positive guidance in making board appointments. Given the large political focus on alleged cronyism in appointments to State boards, it is good to see provisions in this legislation that give parameters and guidance to Ministers in making such appointments. It is important to see gender balance being one of these considerations. The Minister may consider an alternative approach to amendment No. 3, along the lines of section 10(5), which would read: "The Minister shall, in so far as is practicable and having regard to the knowledge or experience of matters relevant to the functions of the authority of the persons concerned, ensure an appropriate representation of those representatives of the interests of consumers upon the authority." This might be a less prescriptive way of ensuring consumer interests are adequately represented on the authority, given it is prescriptive about representatives of persons who provide property services. Perhaps the Minister will take on board my alternative wording when the Bill goes to the other House.

Amendment agreed to.

I move amendment No. 3:

In page 22, between lines 37 and 38, to insert the following:

"(b) at least 3 shall be persons who, in the opinion of the Minister, are representatives of the interests of consumers, and”.

That is not agreed.

I understood it was agreed.

Amendment put and declared lost.

Amendments Nos. 4 and 5 are related and may be discussed together by agreement.

I move amendment No. 4:

In page 32, to delete lines 40 to 49 and substitute the following:

"(10) A licensee who fails to comply with a code of practice is guilty of an offence and shall be liable on summary conviction to a fine not exceeding €5,000.".

This amendment is somewhat altered in its wording but is based on an amendment to section 19 tabled on Committee Stage which deals with codes of practice. We are trying to substitute a new section 19(10) for the existing section 19(10). This would give greater teeth or powers of enforcement to the codes of practice adopted under the section. I said on Committee Stage that the current section 19(10) makes the codes of practice effectively unenforceable because it states that a failure by a licensee to observe any provision of a code of practice will not, of itself, render the licensee liable to any civil or criminal proceedings. This would substantially alter the effectiveness of codes of practice by ensuring someone who failed to comply with the code would be guilty of an offence and liable, on summary conviction, to a fine not exceeding €5,000.

Amendment No. 5 is related but does not depend on Amendment No. 4. It should be considered as a stand-alone amendment because it is an amendment to section 36 which concerns the renewal of a licence. This was not tabled on Committee Stage but arises out of the Committee Stage debate because it is about trying to give greater teeth to the codes of practice and to ensure they will have more effect or impact. I am aware the Minister had a concern about creating criminal liability around the breach of the code but this is much less extreme. It is important because it requires the authority to refuse to renew a licence if section 36(2) or another provision of the Act, including a code of practice, has not been complied with in respect of a person. It creates another enforcement mechanism for codes of practice holding that the authority shall refuse to renew licences where the codes of practice have been breached. It is about trying to make the codes of practice more effective and clearly enforceable.

The purpose of a code of practice under the Bill is to provide guidance in the form of non-binding standards in respect of the provision of property services. For this reason, any failure to observe a provision of such a code would not, of itself, render a licensee liable to any civil or criminal proceedings. It can, if relevant, be taken into account by the authority, the appeals board or any court in determining whether "improper conduct", as it is termed in the Bill, has occurred.

This approach to the implementation of codes of practice was also used in other legislation. For example, section 56 of the Employment Equality Act 1998 and section 60 of the Safety, Health and Welfare at Work Act 2005 provide for codes of practice, and in neither case are sanctions provided for.

This Bill provides that non-observance of a code of practice can be taken into account in proceedings in determining whether improper conduct has occurred or is occurring. It is best to illustrate this by an example. Section 61 requires auctioneers to keep records of offers received on condition of acceptance where land is offered for sale by private treaty. The authority may decide in due course to issue a code of practice on how best to record this data and retain it. If it subsequently emerges that a licensee has breached section 61, which would amount to improper conduct, the authority or the appeal board can take account of the fact that the code of practice was issued and the licensee should have known of its content and followed it. Ignoring the code will not, of itself, be an offence but it will be much more difficult for a licensee to avoid a finding of improper conduct against him or her in such a case.

The sanctions in the Bill are substantial. A licensee's licence can be suspended or revoked or he or she can be required to pay up to €50,000 into the compensation fund, up to €50,000 towards the cost of an investigation of the authority and-or up to €250,000 to the authority. For these reasons, I cannot accept amendment No. 5 which would, in effect, be a block to the renewal of a licence for breach of a code.

I stated on Committee Stage that codes of practice are what they mean. They are there for guidance and not such that one must adhere to them to the letter of the law. A breach or avoidance of or ignoring the code of practice could be taken into account in respect of a finding of improper conduct against a licensee.

Amendment put and declared lost.

I move amendment No. 5:

In page 45, line 37, after "subsection (2)” to insert the following:

"or another provision of this Act including a code of practice".

Amendment put and declared lost.

Amendments Nos. 6 to 13, inclusive, and Nos. 15 and 16 are cognate and may be discussed together by agreement. Is that agreed? Agreed.

Government amendment No. 6:
In page 54, line 36, after "to the High Court" to insert "in a summary manner".

These are technical amendments. They provide that applications to the High Court and Circuit Court in the first instance shall be in a summary manner. This will mean the procedures for statutory applications under the rules of the superior courts and Circuit Court rules will automatically apply to such applications. This will remove the need to make specific rules of court to deal with any applications to the High Court or Circuit Court under the Act.

Amendment agreed to.
Government amendment No. 7:
In page 57, line 18, after "apply" to insert "in a summary manner".
Amendment agreed to.
Government amendment No. 8:
In page 58, line 46, after "apply" to insert "in a summary manner".
Amendment agreed to.
Government amendment No. 9:
In page 59, line 13, after "apply" to insert "in a summary manner".
Amendment agreed to.
Government amendment No. 10:
In page 63, line 16, after "application" to insert "in a summary manner".
Amendment agreed to.
Government amendment No. 11:
In page 63, line 35, to delete "on anex parte basis” and substitute “in a summary manner ex parte”.
Amendment agreed to.
Government amendment No. 12:
In page 68, line 10, after "apply" to insert "in a summary manner".
Amendment agreed to.
Government amendment No. 13:
In page 75, line 37, after "application" to insert "in a summary manner".
Amendment agreed to.
Government amendment No. 14:
In page 88, line 43, to delete "Subsections (4) and (6)” and substitute “Subsections (4) and (5)”.

This is merely a technical amendment.

Amendment agreed to.
Government amendment No. 15:
In page 100, line 22, after "apply" to insert "in a summary manner".
Amendment agreed to.
Government amendment No. 16:
In page 101, line 15, after "apply" to insert "in a summary manner".
Amendment agreed to.

Amendments Nos. 17 and 18 are cognate and may be discussed together by agreement. Is that agreed? Agreed.

Government amendment No. 17:
In page 124, lines 8 and 9, to delete "and Financial Services Authority of Ireland".

These are drafting amendments.

Amendment agreed to.
Government amendment No. 18:
In page 125, lines 33 and 34, to delete "and Financial Services Authority of Ireland".
Amendment agreed to.
Government amendment No. 19:
In page 125, between lines 39 and 40, to insert the following:
"Amendment of section 36 of the Building Societies Act 1989.
7. Section 36(1)(f) of the Building Societies Act 1989 is amended by deleting “auctioneering services and”.”.

This is a drafting amendment.

Amendment agreed to.
Bill, as amended, received for final consideration.
Question proposed: "That the Bill do now pass."

I thank the Chairman, the Seanad staff and mine for their work on the Bill. I also thank the Members of the House for their consideration of it. There was a relatively lively debate on Second Stage and the Bill is better for some of the amendments made which were prompted by both sides of the House. I was amenable to some of the changes prompted by the Opposition. It is necessary to get the legislation which I inherited when appointed Minister up and running. It might be said it involves another authority which, perhaps, we would reconsider in other times, but it is necessary to regulate this area properly. The broad spectrum of auctioneers, letting agents and management service providers has not been regulated as we would wish. The Bill fits in very well with the multi-unit development legislation which we concluded a couple of days ago. Obviously, one cannot deal with everything in this area in just one legislative measure. I thank Members of the House.

Before calling Senator Bacik, I draw the attention of Senators to the following printing error in the Bill which occurred when it was being reprinted following Committee Stage. In page 119, between lines 23 and 24, a line of text is missing. The text which was erroneously omitted reads as follows:

"(2) In section 29(2), any reference to a licensee is a reference to a relevant person.”

The missing text will be included when the Bill is reprinted following Report Stage.

I welcome the passing of the Bill which is long overdue. This is an area in which the interests of consumers have been unprotected for too long and, as the Minister said, the sector has been largely unregulated until now. We, therefore, welcome the Bill and its companion measure, the Multi-Unit Developments Bill which will improve the situation of apartment owners and residents. However, an important reform is not contained in either Bill. When I raised the matter on Committee Stage, the Minister said he had concerns about data protection issues, although it was included in the programme for Government and would be, perhaps, the last stage in reform of this sector in the interests of consumers. It would involve the publication of house purchase prices in a publicly accessible register, as happens in other jurisdictions. This would be a way of ensuring greater transparency in the housing market. However, that is a reform for consideration on another day. I welcome the Bill.

Yes, it has been a long road. The process started in this House six or seven years ago when Senator O'Toole and I said something had to be done about auctioneers. We progressed to a special commission to examine auctioneers, followed by recommendations. Whereas there are many inadequacies in the Bill, the situation is far better than it was. Not to put too fine a tooth in it, prior to this Bill, there was no regulation in auctioneering. There were a couple of auctioneering bodies which were toothless and fought each other rather than anybody else. They did little to regulate auctioneers. In fact, the Irish Auctioneers and Valuers Institute, IAVI, and the association of chartered surveyors have merged since yesterday and it should be noted that the chartered surveyors are not calling themselves auctioneers, while the auctioneers are calling themselves chartered surveyors. Nobody has the desire, given the history of auctioneering in this country, to call himself or herself an auctioneer, following the scams and malpractices in the sector. One did not require a single qualification to be an auctioneer. That one did not have to be able to read, write or add to be an auctioneer was an absolute disgrace, given that one was handling clients' money.

It is appropriate to welcome this measure, although I accept there have been political difficulties for the Government in doing this. The auctioneering lobby is and has been extremely strong and there has been much behind the scenes action in an attempt to amend, change and defeat the Bill. The legislation is a step in the right direction. I will not add anything further on its inadequacies which have been mentioned many times. This is progress and I thank the Minister for bringing the process to completion.

I thank the Minister for dealing personally with the Bill on the different Stages in the House. It is important legislation, with the Multi-Unit Developments Bill which we concluded on Tuesday. While it has taken some time, it is important for the regulation of auctioneering, estate agents, letting agents and so forth. The fact that the Property Services Regulatory Authority is already in place having been established on an interim basis will, I expect, allow for implementation of the Bill without undue delay. We have done good work this week in the regulation of the property market and service providers which will be of benefit in the future.

I welcome the passing of the Bill and thank the Minister for the time he spent considering it, as drafted, accepting amendments and teasing out various options to make it a better and well considered Bill. I also thank the staff in the Minister's office. The legislation is long overdue and very welcome. Practically every citizen has had dealings with those involved in property services, be they auctioneers, estate agents, letting agents or others; therefore, the Bill will be widely welcomed. It will improve the situation of people who are buying or selling houses to know they have access to an appeals mechanism and that they can have transparency when dealing with auctioneers. This is long overdue, as all sides of the House agree.

Question put and agreed to.

When is it proposed to sit again?

At 2.30 p.m. on Tuesday, 15 June.

I register my opposition to the proposal that the House not sit next week and that it sit again on 15 June.

I also oppose the proposal. I propose that the House sit at 2.30 p.m. next Tuesday, 8 June, as normal.

Senator Doherty pre-empted my comments, but I support Senator Regan in his opposition to the adjournment of the House until 15 June. Like the Dáil, we should sit next week.

Question put: "That the House adjourn until 2.30 p.m. on Tuesday, 15 June 2010."
The Seanad divided: Tá, 28; Níl, 18.

  • Boyle, Dan.
  • Brady, Martin.
  • Butler, Larry.
  • Callely, Ivor.
  • Carroll, James.
  • Carty, John.
  • Corrigan, Maria.
  • Daly, Mark.
  • Dearey, Mark.
  • Ellis, John.
  • Feeney, Geraldine.
  • Glynn, Camillus.
  • Hanafin, John.
  • Keaveney, Cecilia.
  • Leyden, Terry.
  • MacSharry, Marc.
  • McDonald, Lisa.
  • Mooney, Paschal.
  • Ó Brolcháin, Niall.
  • Ó Domhnaill, Brian.
  • Ó Murchú, Labhrás
  • O’Brien, Francis.
  • O’Malley, Fiona.
  • O’Sullivan, Ned.
  • Ormonde, Ann.
  • Walsh, Jim.
  • White, Mary M.
  • Wilson, Diarmuid.

Níl

  • Bacik, Ivana.
  • Bradford, Paul.
  • Buttimer, Jerry.
  • Cannon, Ciaran.
  • Coghlan, Paul.
  • Doherty, Pearse.
  • Donohoe, Paschal.
  • Fitzgerald, Frances.
  • Hannigan, Dominic.
  • McFadden, Nicky.
  • Mullen, Rónán.
  • Norris, David.
  • O’Reilly, Joe.
  • Phelan, John Paul.
  • Regan, Eugene.
  • Ryan, Brendan.
  • Twomey, Liam.
  • White, Alex.
Tellers: Tá, Senators Niall Ó Brolcháin and Diarmuid Wilson; Níl, Senators Pearse Doherty and Eugene Regan.
Question declared carried.