Select Committee on Social Affairs debate -
Thursday, 15 Jul 1993

SECTION 3.

Question proposed: "That section 3 stand part of the Bill".

Mr. Shatter

I want to raise an issue of concern to which we can return on section 19. As the Minister is aware, under section 12 of the Married Women's Status Act, 1957, an extremely large number of court decisions have been delivered during the years in the High Court and Supreme Court in which the law with regard to claims to interest in property has been set out. A large body of law has been built up under which a spouse is allowed to acquire a beneficial interest, not just in the family home but in other properties based on the contribution — financial or work — they have made to the acquisition of family assets. Our law in this area has developed to a greater degree of sophistication than the law in the United Kingdom which was mirrored in the decisions delivered in the sixties and early seventies in this area.

The Minister is repealing section 12 of the 1957 Act which applies, as I said, not just to family homes but to business properties such as public houses and the small family businesses, for instance a shop and providing a new section 19 for the determination of property disputes. There is nothing in sections 3 or 19 indicating that the case law developed by the courts originally under the 1882 Act and subsequently under the 1957 Act will continue to be applied by the courts following the repeal of section 12.

I appreciate this sounds technical to non-lawyers but it is possible that the courts will take the view, if section 12 is repealed and replaced with this new section 19 which is quite different, that they are starting off with a clean sheet and that the case law developed under section 12 is not applicable.

Mr. Taylor

Section 21 covers this.

Mr. Shatter

No, section 21 deals with one specific aspect of the problem. Let us assume that we are dealing with a public house which the husband and wife have been running but that the legal title of the property is in the sole name of the husband. Under section 12 of the 1957 Act the wife may be able, by proving that she did not take remuneration and establishing that she made a work contribution to acquire ownership rights or a beneficial interest in the property. This is also true in the case of the small grocery shop on the corner and very modest — as well as bigger — businesses. Case law has been developed by the courts and it prescribes the way in which they should approach such claims to a proprietary interest.

Mr. Taylor

In what respect does section 21 not apply?

Mr. Shatter

Section 21 deals with one aspect of the problem only. Conflicting judicial decisions have been delivered at High Court level in respect of one particular problem. Let us assume the husband owned a business property before marriage, that the property has been paid for and that the wife, through moneys she has acquired or through a substantial work contribution, has made a contribution which allowed major renovation work to be undertaken or a major extension to be built to that property. Some judges have taken the view that where renovation work was undertaken or an extension built in those circumstances the wife should acquire a proportionate beneficial interest in the property, but other judges have said that she should not because if she is to acquire a beneficial interest one must relate to the position at the time the property was acquired. Section 21 is a copy of a provision contained in the 1958 legislation in England, which led to the elimination of this problem there which states that regardless of who owns the property, if a spouse makes a substantial financial contribution he or she can acquire a beneficial interest.

Section 21 is aimed at resolving the problem which has been caused due to the fact that conflicting judicial decisions have been delivered in the context of one type of dispute which comprises the minority; most disputes relate to either businesses or family homes in circumstances where the legal title is in the name of one spouse and the other spouse proves, either by direct or indirect contributions, that he or she has contributed to its acquisition. Direct contributions may include payments towards the mortgage or deposit on a house while indirect contributions include the income from work a wife has used to defray all family outgoings leaving the husband to use his income to acquire a business premises or an investment property. It has been held that the wife is entitled to acquire a proprietary or beneficial interest in those properties.

Where the property is not a family or matrimonial home it falls outside this Bill. If we repeal section 12 there will be a need to make a specific amendment to section 19 in which it is stated that the existing case law developed under section 12 of the 1957 Act will continue to be applied by the courts under section 19 except where case law is amended under section 21. It is not simply a question of repealing section 12 and providing section 19; we need to preserve a body of law under which a number of additional rights and protections are given. These fall outside this Bill which deals with the matrimonial home. If it is not preserved disputes will arise following enactment of the legislation.

Miss Flaherty

On Second Stage I expressed concern about the proposal to repeal section 12 of the Married Women's Status Act, 1957 under which women have gained entitlements arising from their various contributions. However, in the context of repealing that section, it is wise to signal concerns about how the later sections of this Bill replace this and whether they do the job adequately.

Chairman

Is section 3 agreed?

Mr. Shatter

Is the Minister going to respond to the points raised? Does he regard them as valid?

Mr. Taylor

I have heard nothing from Deputy Shatter or Deputy Flaherty that shows where there is any alleged deficiency in section 21. I presume Deputy Shatter will table some amendment on the issue. I will have a look at any such amendments when received. If I find there is any deficiency in the legislation I will be happy to deal with it.

Miss Flaherty

While we did not table a specific amendment on this occasion I raised on Second Stage the concerns expressed to me by some lawyers that, for example, section 21 deals with improvement of property, and the question of contributions towards properties but does not refer specifically to the purchase and initial investment. Because it is proposed to delete the provisions of the Married Women's Status Act, 1957 — which would have dealt with the financial contribution on the acquisition and initial purchase of the property — a gap remains. I raised that point specifically on Second Stage because it had been raised with me. The point was made to me that this would leave a very real gap in the context of moving from one legislative provision to another, though perhaps it is provided for elsewhere. Section 21 covers a spouse who has made a substantial contribution to the improvement of personal property but does not refer to the contribution to the purchase or acquisition of the property. Is that included elsewhere? It is a substantive point.

Mr. Taylor

It arises under section 21. I will be happy to deal with it there. I do not think there is a gap, but I am prepared to talk about it.

Question put and agreed to.

The Select Committee adjourned at 4.25 p.m.