There are two Bills being discussed by the House, one dealing with rent restrictions and the continuation of the position as it has been since last July until 25 April, and the other dealing with private rented dwellings. It is hoped that both Bills will go through both Houses of the Oireachtas and, if necessary, will be referred by the President, to the Supreme Court to judge on their constitutionality.
In legislating for this area it is essential that this House achieve a balance between the rights and interests of landlords and the rights and interests of tenants. The Housing (Private Rented Dwellings) Bill, 1981 is an attempt to find that balance of interests, to protect both sides in this type of situation and to provide legislation which falls within parameters set by constitutional provisions relating to both private property and the common good. I would draw the attention of the Minister to certain aspects of the Bill and certain modifications that could be made to it as it progresses through the House that would to some extent tighten it up while continuing to maintain the delicate balance between the rights and interests of tenants and landlords that must be preserved.
Section 14 of the Bill applies to the area of houses that come under rent restrictions legislation and also lays down minimum standards to be applicable to all private rented accommodation. The section confers power on the Minister to make regulations in this regard. This section could be tightened up. The intention of the section is to protect the interests and rights of tenants. Any such provision if it is to have teeth and to be effective must have proper enforcement mechanisms to ensure that those who do not comply with the statutory minimum standards set can be required to do so under the terms of the relevant legislation. As the legislation stands, effectively the obligation would be imposed on the housing authority or the local authority within whose area a particular building is situated to ensure that the minimum standards are complied with. That procedure will not result in the legislation ensuring that minimum standards are fully and properly complied with in future. All of us who are members of local authorities and those Members of this House who are not but who have continual contact with local authorities know how overstretched local authorities are and the extent and great expansion of work that has fallen to the officials in the various local authorities and the great dedication of these officials in carrying out their work. Speaking as a member of Dublin County Council I pay tribute to the officials of the housing section of that council who, no doubt, in the context of this Bill would have the obligation to ensure that these minimum standards are fully and properly enforced. When one looks at the amount of private rented accommodation available in Dublin city and county one realises that it is not possible, unless we were to create and expand greatly a form of housing inspectorate within the local authority, for these minimum standards to be enforced properly and fully in the way set down in the Bill. We should have a second look at this.
The local authorities should continue to have a role, but an obvious way which would involve far less cost to the State and far less administration would be to confer a right on tenants to enforce such statutory minimum standards as the Bill intends to impose. If this right was conferred on tenants then the tenants living in these houses would have a real interest in ensuring that the houses are looked after and maintained properly and that landlords comply with minimum standards, as I believe the vast majority of them do. I suggest that the Bill be amended by the insertion of a clause to the effect that such minimum standards as are laid down in the Bill or imposed by regulations should be implicit terms of any tenancy contract or agreement concluded between a landlord and a tenant. That would afford the tenant an opportunity of enforcing directly such minimum standards without having to depend on the local authority. It would save the State money in that if proceedings of some nature were to be brought under this legislation the vast majority of cases would be brought by tenants.
We are aware of the present financial circumstances and the great difficulties we are facing in the future. We have heard from both sides of the House in recent debates on economic issues about the need to ensure that the non-productive sector of the public service is not expanded at this time because that would only incur debt that this country can ill afford. Nevertheless, unless we provide a series of house inspectors as I have suggested I would be very worried that the intent of section 14 — which is good and the Minister is to be congratulated for what is in the section and such minimum standards are long overdue — would not be enforced. If it is to be enforced it should be possible for tenants to enforce it.
Another means of ensuring that the provisions of this section are enforced is by making it possible if a landlord has not complied with minimum standards for a tenant to obtain damages in court against the landlord. At present this section merely provides for a fine of up to £500 for non-compliance. That is not the correct way to deal with this. In this area the system of prosecution does not work effectively and we have seen that it does not so work in the context of other legislation produced by different administrations that has come out of the Department of the Environment or the Department of Local Government as it was known formerly. Criminal prosecutions in these circumstances are not effective if they have to be instituted by a local authority. This provision in section 14 would work far better if it conferred the right on a tenant to enforce the minimum standards and enabled the court before which such proceedings could be brought to order moneys by way of compensation to a tenant upon the landlord being found to be in breach of his obligations.
A provision in section 3 of the Bill enables the tenant, if he wishes to do so, to surrender the dwelling to the landlord. This has happened in the past and it will happen in the future, and, no doubt, for sound reasons, economic or otherwise, landlords and tenants will opt out of the provisions of the Bill and tenants will be paid compensation for vacating a house of which a landlord wishes to acquire possession. In some instances tenants may voluntarily return possession of a house for specific reasons, and this has happened even under the old legislation, although rarely.
I would like to draw the attention of the Minister to another matter of concern that should be clarified to avoid unnecessary litigation under this Bill when enacted. As the Bill stands at the moment a tenant can effectively surrender his or her interest and the tenant in a marital situation can be either the husband or the wife. Under the provisions of the Bill, upon the death of a tenant spouse the remaining spouse will take over or acquire the deceased spouse's interest. We have other legislation which is relevant in this area. We experienced difficulty in the past with legislation of a technical nature in this whole area of rented accommodation and the legislation applicable today is one of the most difficult and technical areas of law. Far too often, legislation is drafted concentrating on the direct problems identified with this area, without regard being had to existing legislation which has some implications in the area.
In this regard I draw the Minister's attention to the Family Home Protection Act, 1976, under the terms of which a spouse cannot dispose of a family home without the consent of the other spouse. A family home can be any type of home. It does not have to be a home being purchased on mortgage, or fully paid for. It can be a rented house, which a husband has rented for his family and which falls within the ambit of this, or any other legislation. This Act, while expressly providing that a tenant may hand over his interest to a landlord, does not expressly say that the tenant does so validly and legally if he has a spouse and if the rented accommodation is a family home, the consent of that spouse should be sought. My belief is that two married people act together and such consent will be required by lawyers acting for landlords in such circumstances.
There has been much difficult litigation under the Family Home Protection Act. Indeed, there have been two important High Court cases in the past week, concerning the area of judgment mortgages. What I see as a complex area merits trying to avoid creating any further complexities or difficulties, if they can be avoided. I urge the Minister to look at this issue. It would be simple to amend this section of the Act to provide that the consent of the spouse would be required to hand over tenancy of the type of dwelling which comes within the ambit of the Act. Such provision could avoid unnecessary court procedures and litigation.
The main tenor of the Act is to ensure that the rights — as they should be — of the tenants in these houses are protected in the sense that they have the security of knowing that accommodation in the house — many of which have been family homes for 20 to 40 years — will continue to be available to them and that their interest in it should be protected. This is based on the premise that this accommodation will continue to be of a rented nature. While the Act provides a mechanism for renegotiation of rents, it provides no mechanisms, other than under other circumstances in which a tenant could lease or surrender a tenancy.
Take the position of a tenant who has been living in such a house for fifteen or twenty years, has no intention of moving, has complied with all the conditions of his tenancy and, indeed, has a good landlord who is willing to allow him to continue to live in the house and to negotiate a reasonable rent. The Act envisages that that rental situation will continue. It is fair to say that many tenants live in rent-controlled accommodation who, over the years, have been anxious to purchase the house from the landlord. Indeed, Members from all sides of this House must come across the situation where a tenant purchased such a house from his landlord prior to the recent Supreme Court case, at a sum greatly below the true value of the House. I am aware of a number of instances where such negotiations were taking place prior to the Supreme Court declaring the rent restriction legislation unconstitutional. Such negotiations abruptly came to a halt, pending the introduction of this legislation into the House.
We could usefully include an additional provision in this Act of a mechanism to enable tenants to purchase the house in which they reside, if they so wish — a mechanism which would not only be in the interests of tenants but of landlords as well. If a tenant wishes to purchase a dwelling, as the Act stands at the moment, if he negotiates with the landlord and the landlord and tenant cannot reach agreement as to what price should be paid for the house, there is no mechanism whereby such agreement could be arbitrated. We could very usefully look at the possibility of including a purchasing mechanism in the Act which sets down procedures in the case where, if the landlord and tenant agree, in principle, to the house being sold by the landlord to the tenant — and I do not think that we can force the sale — the one outstanding issue is to agree a price. One could usefully include in this Act a form of arbitration clause which would empower the court having jurisdiction in the context of the Bill — the District Court — upon hearing proper evidence in relation to valuation, to fix an appropriate price to enable such a sale to take place. That would be in the interests of both parties, landlord and tenant. That aspect should be very seriously examined and it would add something to this Bill.
Two aspects of the Bill have been referred to. One is that the Bill is effectively — except for section 13 and 14 — confined to those forms of dwellings previously known as rent-controlled dwellings. The second aspect is the method of rent fixing set down in section 9 of the Bill. It is not my intention to refer to these in any detail, as the Minister has indicated that there is a possibility that the Bill, as a whole, will be referred by the President to the Supreme Court to judge on its constitutionality. They are the two particular aspects of the Bill which the Supreme Court might wish to have regard to and about which, it is fair to say, there are conflicting legal opinions but which provisions, one should say in fairness, seek to strike the balance which the Supreme Court has previously intimated, in its judgment, should be struck in this area.
One aspect should be referred to in the context of section 9 and that is the rent fixing mechanism.