Seanad Éireann díospóireacht -
Wednesday, 9 Jun 1926

Vol. 7 No. 6

INCREASE OF RENT AND MORTGAGE INTEREST (RESTRICTIONS) BILL, 1926—COMMITTEE STAGE.

The Seanad went into Committee.

Sections 1, 2, 3, and 4 put and agreed to.

SECTION 5.

(1) Where the landlord of a dwellinghouse to which the Principal Act applies and of which both the standard rent and the rateable value exceed £20 is in possession of the whole of the dwellinghouse at the passing of this Act, or comes into possession of the whole of the dwellinghouse at any time after the passing of this Act, then from and after the passing of this Act or from and after the date when the landlord subsequently comes into possession, as the case may be, the Principal Act shall save as hereinafter mentioned cease to apply to such dwellinghouse.

(2) Where part of a dwellinghouse to which the Principal Act applies is lawfully sub-let, and the part so sub-let is also a dwellinghouse to which the Principal Act applies, the Principal Act shall not by virtue of this section cease to apply to the part so sub-let by reason of the tenant being in or coming into possession of that part, and, if the landlord is in or comes into possession of any part not so sub-let, the Principal Act shall cease to apply to that part notwithstanding that a sub-tenant continues in or retains possession of any other part by virtue of the Principal Act.

(3) For the purposes of this section the word "possession" shall be construed as meaning actual possession and a landlord shall not be deemed to have come into possession by reason only of a change of tenancy made with his consent.

Sir JOHN KEANE

I move:—

Sub-section (1) To delete in line 24 the figures "£20" and to substitute therefor the figures "£10."

The object of the amendment is to extend the decontrol of houses that fall vacant after the passing of the Act to the casual vacancies, which will be subject to a new agreement. The section provides that they shall become decontrolled if their value does not exceed £20 valuation. The effect of the amendment will be that that figure will be reduced to £10, and that all houses under the value of £10 should automatically become decontrolled if they become casual vacancies after the passing of the Bill. In view of the fact that decontrol will altogether disappear, as we hope, in 1929, and that a very small number of vacancies are likely to occur during the interim period, I put forward the amendment.

MINISTER for JUSTICE (Mr. O'Higgins)

Section 5 was not a feature of the Bill as introduced, and when the change was proposed I had considerable difficulty in accepting it, for the reason that while I was aware that something of the kind has been embodied in the British legislation, it seemed to me to be a fundamental departure from the basis of this control legislation. It was never the conception that the legislation was introduced to protect existing tenants, or to affect only existing tenancies. The legislation, as I conceive it, was introduced to control houses built back in the times before the shortage became acute, and before the cost of material and labour rose so sharply and it seemed to me to be rather a mixing up of principles to introduce this new idea— that it was in favour of existing tenants and existing tenants only that the legislation should run. I always envisaged these Acts as being introduced not merely in favour of and for the protection of existing tenants, but also for the protection of prospective tenants. The principle was clear that the mere economic factor of demand and supply would drive the rent of houses to a very high point, really above the capacity of the public to meet, or certainly would put them to a very severe strain to meet.

No better argument really was adduced than that something of the kind existed in legislation elsewhere, and I was asked to agree to the idea that houses falling vacant from whatever cause might be allowed to pass out from the pressure of our control legislation, and soar to whatever value the mere demand factor would bring. I accepted that, but with the reservation that it will not apply to houses under £20 valuation. That was to ensure that at least the people of modest incomes looking for the smaller class of houses would not be met with very high rents in their search for houses, and I agreed that upwards of that figure we might legislate so that a house falling vacant might pass out from under our control pressure. The Senator asks that I should come still lower down the scale of valuation and agree that this concession will be extended to houses exceeding £10 valuation. Well, it is a matter of opinion, but I want to put it very definitely that my judgment and opinion, and the opinion of my Department which has weighed the matter, is against the amendment. Section 5 as it stands represents what we regard as a substantial concession, and I am opposed to the idea that we should apply that to the smaller kind of houses the valuation of which is lower than £20.

Dr. GOGARTY

Might I ask the Minister if the valuation of sub-lettings in large buildings, for instance, committee rooms, offices, and flats, is included? I can see the difficulty of letting a large building if it were subject to small lettings under the narrow valuation of £20.

Mr. O'HIGGINS

In the Principal Act our definition of dwelling house includes and covers portion of a house. I think that the smaller sub-lettings to which the Senator refers would remain controlled.

Mr. FARREN

I oppose the amendment. It appears to me that the more concessions that are given to that "shy bird" we hear so often talked about by Senator Sir John Keane the more concessions are wanted. When the Bill was originally introduced there was no provision such as that embodied in the section which it is now proposed to amend. Not satisfied with the concessions already granted, Senator Sir John Keane asks that houses with a valuation of £20 or over that may become vacant should not come under control. The amendment proposes to take in houses with a £10 valuation. Might I suggest to Senator Sir John Keane that if these demands are pressed too high they may defeat themselves. The fixing of high rents and taking advantage of the present position whereby people are compelled to take houses and pay a rent far above the letting value of the premises, is one thing, but getting the rents is another thing. I believe that if Senator Sir John Keane insists on getting unlimited power to charge whatever rents the scarcity may warrant, that eventually may defeat itself.

Mr. GUINNESS

Is it suggested in this section that at some future date before 1929 these houses may come out of control, as stated in other sections, or does this section as it stands keep these houses of a valuation under £20 under the Act until the Act disappears?

Mr. O'HIGGINS

The proposal of Senator Sir John Keane is that this concession, as I term it, that a house falling vacant shall be freed from control, shall be extended down to a valuation of £10. I fix £20, and the section states £20. As I say, it was just a little difficult to accept Section 5, even as it stands, for it seems at variance with the entire principle of our legislation, which I regarded as being the control of houses rather than to protect tenants, or rather, shall I say, to protect not merely existing but prospective tenants. If the amendment is carried, the effect of it is that that concession is brought down even to houses with as low a valuation as £10. If it is not carried the position is that houses upwards of a valuation of £20 falling vacant are thereby freed from control, while houses under £20 valuation are simply covered by the Bill and remain controlled up to the period the Act would expire.

Amendment put and on a show of hands declared lost.

Section 5 put and agreed to.

SECTION 6.

The Principal Act shall as from the 24th day of June, 1926, be construed and have effect as if sub-section (1) of section 8 thereof were amended as follows, that is to say:—

(a) by the insertion in subparagraph (c) (iii) thereof after the words and figures "during the period of the two years 1923 and 1924" of the words and figures "or the period of the two years 1925 and 1926, or the period of the two years 1926 and 1927, or the period of the two years 1927 and 1928";

(b) by the deletion in sub-paragraph (d) thereof of the word "ten" and the insertion in lieu of the word so deleted of the word "twenty."

Mr. FARREN

I move to delete paragraph (b). The object of this amendment is quite clear. It is proposed under the section that the house-owners shall be entitled to an increase on the standard rent of twenty per cent. instead of ten. In other words, the owners of house property will be entitled to demand 100 per cent. of an increase on the 1924 standard rent on the letting. The object of the amendment is quite clear, and that object is that the increase on the standard rent shall remain the same as in the Act of 1923, and that the proposed increase from ten per cent. to twenty per cent. shall not take place. I accordingly move my amendment.

Sir JOHN KEANE

I hope the Seanad will look at the other side of this case. There are a great many people who invested all their savings in house property, people who like to see their money under their eyes. Perhaps they did not understand, and wisely so, the business of investments in stocks and shares, and they put this money out in house property. This money represented all their savings. Now all they have been allowed for their money up to the present is ten per cent. of an increase on 1914, whereas the cost of living has gone up so very much higher. After so many years this increase of ten per cent. should be raised from ten per cent. to twenty per cent. It is a very small increase, considering the rise in the index figure in the cost of living, and I think it is only just that they should be allowed to increase the rent by twenty per cent. considering the very high rise in the cost of living.

Mr. O'HIGGINS

Before entering on the merits of this amendment, I would like to refer to what took place on the last day in which the Seanad met in connection with Senator O'Farrell's speech after I had replied to the discussion. The fact that the Senator intervened after I had spoken, after, as I thought, winding up the debate, nettled me somewhat, and then the substance of what the Senator had to say and his Party references, and so on, added to that, and I used an adjective that I would like to withdraw. In connection with his speech I referred to it as an "ignorant tirade." I would like now to substitute the adjective "ill-informed" for "ignorant," and to express my regret that I used the latter word.

In connection with this proposal to delete paragraph (b) I think the Senator responsible for the amendment has scarcely examined closely the merits of the matter. When we were preparing this Bill I got a table of certain houses here in the city, a dozen or fifteen houses, and I traced in each case the effect of our legislation—both the effect of the 1923 legislation and the effect of the proposals embodied in this Bill. I will not ask the Senators to listen to a recital of the entire table, but for the sake of a clearer understanding of the matter, and so that we may avoid extravagant talk on either side, I would like to go through four of these houses as examples. First, I will take example No. 1. That is a house which has a valuation of £33. In the year 1914 the rates on that house were £18 17s. 5¼d., and the rent, inclusive of the rates, was £60 0s. 0d. In 1923-24 the rates were £32 11s. 9d. and the rent, inclusive of rates, £81 18s. 10d. In 1924-25 the rates were £31 12s. 6d. and the rent was £80 19s. 7d. In 1925-26 the rates were £28 6s. 6d. and the rent, inclusive of rates, £77 13s. 7d. Under the provisions of this Bill the rent for the year 1926-27 would be £79 17s. 4d. The rates this year are £26 8s. Now reading down this list the rents of this house are: 1914, £60; 1923-24, £81 18s. 10d.; 1924-5, £80 19s. 7d.; 1925-6, £77 13s. 7d. and (if this Bill is passed) for 1926-27, £79 17s. 4d.

Mrs. COSTELLO

Does that rent include the rates?

Mr. O'HIGGINS

The rents throughout in this case include the rates. It would be making a mistake at the start to say that because in this case the rent in 1914 was £60 and that the rent in 1926-27 was £79 17s. 4d, there is £20 of an increase for the house-owner, over and above 1914, for, of course, that is not the position. There is the increase in rates to be reckoned and the increase in the cost of repairs. You have then, under the Bill, the position that a rent of £79 17s. 4d. for this year represents an increase on the year 1925-26 of £2 3s. 9d.; a decrease on the year 1923-24 of £2 1s. 6d. and a decrease on the year 1924-25 of £1 2s. 3d. That is my first example.

My second example is a house with a valuation of £18. The rates on this house in 1924 were £10 5s. 10½d. In 1923-24 £17 15s. 6d.; in 1924-25, £17 5s. 0d.; in 1925-26, £15 9s. 0d., and in 1926-27, £14 0s. 8d. The rent inclusive of rates was: 1914, £36; in 1923-24, £48 12s. 5d.; in 1924-25, £48 1s. 11d.; in 1925-26, £46 5s. 11d.; and under the Bill in 1926-27, £47 16s. 4d. That £47 16s. 4d. represents an increase on 1925-26 of £1 10s. 5d.; a decrease on the year 1923-24 of 16s. 1d., and a decrease on the year 1924-25 of 5s. 7d.

Now I will give the third example, a house of the valuation of £10 10s. The rates are as follows: In 1914, £6 0s. 1d.; in 1923-24, £10 7s. 8½d.; in 1924-25, £10 1s. 3d.; in 1925-26, £9 0s. 3d., and in 1926-27, £8 8s. The rent in 1914 was £26; in 1923-24, £33 7s. 7d.; in 1924-25, £33 1s. 2d.; in 1925-26, £32 0s. 2d., and in 1926-27, under the proposals in the Bill the rent would be £33 7s. 8d. There you would have under the Bill an increase in the rent over the rent of 1925-26 of £1 7s. 6d.; an increase on the rent for 1923-24 of one penny, and an increase on the rent of 1924-25 of 6/6. I will not bother with the fourth example. It shows the same story.

Mr. GUINNESS

Do these fluctuations simply show the fluctuations of the rates or the fluctuations of the rents? Because if it is inclusive, if they vary so much one would imagine they are due entirely to the change in the rates, and not in the rents.

Mr. O'HIGGINS

I will deal with that. The fourth example shows an increase on the rent of 1925-26 of £1 9s. 4d., on a house with a £15 valuation; a decrease on the 1923-24 rent of 9/11, and a decrease on the 1924-25 rent of 8d. I would ask the Seanad to go through these tables with me and simply to get the proportions of the matter, so that we may not have talk of a particular Party handing itself over body and soul to the gombeen-man and the slum-owners, and so on. A proposed increase in what we may term as bonus of an additional ten per cent. to an increase of twenty per cent. is, in reality, a very slight concession and a very slight additional latitude to people in dealing with what is the first stage of this particular problem.

What does it come to? A matter of a couple of pounds in the year's rent of the typical average case that I have taken. There is no need for anyone to throw fits or become aggressive or truculent about proposals of that kind. It is at least one that we can discuss calmly. But what does this amount of percentage increase 1926-27 rent represent over the rent inclusive of rates of 1914? In or about 33? per cent. You have to remember that in that there is a substantial increase of rates and a substantial increase in the cost of repairs. I venture to say that in the case of one of these houses if you were to go into the matter closely you would find that the actual increase to the house-owner, the amount of money he put into his pocket, and said: "This is mine," does not amount to more than £8 or £10. The four cases I quoted are not picked. When the Bill was being prepared I asked to have put before me a table of a dozen or fifteen typical Dublin houses showing the effect of our legislation. I have given four cases. The others are the same. What it comes to is this: I am putting it to the Senator that the proposal to allow an additional 10 per cent. increase is not unreasonable, and I am drawing attention to the fact that it represents a small, almost negligible, increase in the rent to be paid by the tenant over and above the rent paid last year, because rates are coming down.

I have shown, in fact, that it represents a decrease on the rent paid by the tenant in 1923-24 and 1924-25. It is not lavish treatment of the house-owner. Let us not get muddled in our mentality as a result of control legislation. The house-owner is still the house-owner. I do not regard the Bill as generous treatment. We have adverted throughout to the need for seeing that tenants are not unduly strained in the matter of rent, and I say here that we have leant towards the occupying tenants in our legislation, rather than towards the house-owner. I think a very good case might be put up for an addition to that increase. If it is, I will stand over the provisions of the Bill, but I resent when we bring in a Bill of this kind— which I know from examination to be the barest justice to the owners of houses—the suggestion that Senator O'Farrell made here the other day, that simply we have sold our souls to the capitalists because of the depleted condition of our Party funds, or some such reason, and that we have handed ourselves body and soul over to people whom the Senator chose to describe as gombeen men and slum-owners. There has to be fair play, moderation and examination of the merits, even if there is an election looming within the next 12 months. People ought not here, in a deliberative assembly, make harangues which, I suggest, are not even fitted for the election platform, still less for an assembly of this kind. Let us base ourselves on the facts, at any rate, and not simply talk at large.

I was told in the Dáil that this was a new tax which the Minister intended to impose on the community, that it was a deliberate and conscious increase in the cost of living already high, something of malice aforethought, some deadly weapon which we had forged, to strike at the poor and weak elements of the community. Language of that kind is absurd and extravagant. It is not the least evil of control that has created the mentality which can talk like that; as if it were imposing a new tax, as I was told in the other House, to allow a particular element in the community slightly more latitude in the disposal of their own property than had been allowed under the legislation of 1923 and 1920. It is obviously and patently absurd to talk as if the proposals of this Bill were constituted to impose a new tax on the community, or were deliberately and maliciously raising the cost of living which is high. It works out in the case of the average house at £1 or £2 over and above the rent paid by the tenant in the last financial year, and is, in fact, a decrease in most cases of the rent paid by the tenant in the years 1923-24 and 1924-25.

Mr. FARREN

After the severe lecture that we have got from the Minister, I will endeavour not to indulge in any of the antics that he has indulged in. Although I may put my arguments forcibly, I try to avoid personalities.

CATHAOIRLEACH

You do not throw any fits.

Mr. FARREN

I do not think my action warrants the lecture we have listened to. The Minister built up a very good case from the point of view of the property owner, and went to great trouble to ascertain how valuations affect the tenant. Apparently the Minister forgot the most important item, comparing house rent in Dublin with house rent in cities of a similar size. I feel sure that if the Minister's Department investigated the difference between the rents of the respective classes of house in, say, Dublin and Belfast, the difference would give him a tremendous shock. Even before the control period, it was a notorious fact that rents in Dublin were far higher than the rents paid for the same type of houses in cities of a similar size. I make that statement, and if the Minister or any Senator desires to investigate it I am perfectly satisfied that my statement will be found to be correct. The owners of house property in Dublin have been charging rents far in excess of rents charged for the same kind of houses in other centres. When that is remembered it will be found that the Dublin house-owners are not the martyrs that they have been painted, but are having a fairly good time. I am interested in every tenant getting fair play. The difference between the Labour Party and other Parties is that the Labour Party wants fair play for every class of the community. Our experience has been that the other section want fair play for themselves only.

The type of house I am interested in is that with a valuation of £10 10s. If the Minister will look into the figures he will find that under the proposals in the Bill the tenant of such a house will be paying more rent than he paid when the price of everything was high and when wages were higher than they are now. The position we have arrived at is that the working-class tenant—the man who lives in a house with a valuation of £10 10s.—who paid £33 7s. 7d. when the index figures were high is now paying a higher rent. The Minister overlooked the fact that that tenant has been compelled by the force of circumstances to do that out of a reduced income. We have always been told "We must have low wages; wages must come down." Wages are coming down, but rents are going up. That is the new theory in economics, that wages must come down, but rents must go up. I say that no case has been made out for this permitted increase to house-owners of another ten per cent. on the standard rent, in view of the statement I have made. House-owners in Dublin have not been doing so badly, and accordingly I ask for support for the amendment.

Amendment put and declared lost on a show of hands.

Sir JOHN KEANE

I move:—

To add two new paragraphs to this section as follows:—

(c) By the deletion in subparagraph (c) (i) thereof of the word "ten" and the insertion in lieu of the word so deleted of the word "twenty."

(d) By the deletion in subparagraph (c) (ii) thereof of the word "five" and the insertion in lieu of the word so deleted of the word "ten."

Mr. O'HIGGINS

The effect of the amendment is that the Senator wishes to increase from 10 to 20 per cent. the permitted increase in respect to cost of repair. An increase of 10 per cent. is permitted where the landlord is liable in respect of internal and external repairs. Where he is liable in respect of external repairs only the permitted increase is 5 per cent., and the amendment proposes to increase it to 10 per cent. on the standard rent. There is nothing very intricate in the amendment, and personally, subject to the view of the Seanad, I have no objection to the Senator moving the amendment now and endeavouring to convince the Seanad that these increases are reasonable. My own attitude will be one of opposition to the amendment.

Sir JOHN KEANE

I am afraid I do not start under very favourable auspices.

Mr. FARREN

We have not got the amendments.

CATHAOIRLEACH

The Minister has already explained them and they are easily understood. The Senator proposes, in his amendment, that whereas 10 per cent. was allowed to a landlord liable for all repairs, that figure should be increased to 20, and where 5 per cent. was allowed when he was only liable for external repairs, the Senator proposes to increase that figure to 10 per cent.

Sir JOHN KEANE

Yes; that is so. I suggest as a justification of my argument that we might examine the general value of house property, not house property in the best residential quarters but the average class of house property subject to repairs by landlords under present conditions. My experience is you could hardly get a bid for such property. The cost of repairs has risen, very steeply, from the year 1914, due, of course, to reasons that I need not elaborate, but reasons which we all know. Ten per cent. is totally inadequate to cover the reasonable repairs that the landlords have to make. This really would react upon the tenants because there is a very big margin of discretion in the amount of repairs that the landlords will do. I speak with some experience. If a landlord gets a fair return for his money he is far more likely to be lavish in his repairs than if he gets a small return. The effect of this amendment would be to increase repairs. Very often repairs are badly needed and, incidentally, the effect would be to afford more employment and, in several ways, to benefit, not only the tenants themselves, but the class of people who undertake repairs. Although the fact that the Minister cannot accept my amendment does not leave me much hope, still, I ask the Seanad to deal with it apart from the Government, in the spirit of justice which this amendment demands.

Mr. O'HIGGINS

The standard rent, as probably most Senators are aware, is arrived at by taking the difference between the 1914 rent, including rates, and the 1914 rent after subtracting the rates. A provision, under previous legislation, which is not interfered with under this Bill, is that in respect of repairs there was a permitted increase amounting to 10 per cent. of the standard rent where the landlord was liable for all repairs, external and internal, and 5 per cent. where he was liable for the external repairs only of the structure. It might be of help to take an example to show how that worked out. In the case of a house of £33 valuation the standard rent is £41 2s. 6¾d. The repairs incurred in respect to that house with the 10 per cent. increase will be £4 2s. 3d. That was allowed as an addition to the rent and now there is allowed the other 10 per cent. increase, which I referred to loosely as bonus, an increase under the Bill to 20 per cent; Senator Farren's amendment to the contrary having been lost.

This proposal of Senator Sir John Keane to double the allowance, in the way of repairs, is scarcely well-timed. I do not know that there was any such proposal made when the 1923 Act was going through, but, to some extent, and I will not attempt to say to what extent, the cost of repairs is on the wane and the cost of materials is going down. I think the Senator will find that, to some extent, also, labour costs are going down, and it is when the peak is passed and when the curve is downwards the suggestion is made that we should, in fact, double this permitted increase in the case of repairs. I do not think that is sound. If the Senator had concentrated all his artillery on securing a further increase of bonus beyond what is proposed, on securing 30 per cent. instead of 20 per cent. of a bonus, that would have been more logical than coming along and concentrating upon this question of the permitted increase in respect of repairs. I do not think a case can be made for that. The curve may not be a very sharp curve, but, such as it is, it is downward; I would not agree, in face of the facts as I know them, that there ought to be an increase in that particular item. It would have to be shown, and it would be difficult to show, that the curve is upwards, that the material and labour costs, and so on, are on the up-grade, calling for an increased allowance in respect of repairs over and above the 10 per cent. permitted by past legislation.

One could understand the Senator if he pressed that the 20 per cent. bonus was inadequate, but I do not appreciate the mentality that claims that the allowance in respect of repairs is inadequate, unless of course the case is that it has been inadequate throughout.

Sir JOHN KEANE

Hear, hear.

Mr. O'HIGGINS

That no doubt is a point of view, but I can only suggest that the evil, if it is an evil at all, is a diminishing one.

Sir JOHN KEANE

The Minister has really answered in anticipation the point that I was going to make—that 10 per cent. was never adequate at all. I fail to perceive how the house-owners or the house-builders will be able to secure any return. Would the Minister be prepared if I withdraw this amendment to meet us by making some addition to the bonus? Would that commend itself to the Government? The Minister seems to be sympathetic on the bonus but less sympathetic on the question of repairs. It is all the same to the landlord whether he gets it in one case or in the other.

Mr. O'HIGGINS

We have settled the bonus.

CATHAOIRLEACH

Does Senator Sir John Keane wish the amendment put?

Sir JOHN KEANE

No.

Amendment, by leave, withdrawn.

Section 6 put and agreed to.

SECTION 7.

(1) Subject to the provisions of this section where under an agreement for a new tenancy a rent is reserved which does not exceed the standard rent and the increases permitted, in case such agreement was made prior to the 24th day of June, 1923, by the Act of 1920, or, in case such agreement (whether made before or after the passing of this Act) was made on or after the 24th day of June, 1923, by the Principal Act as amended by this Act the amount by which the rent so reserved shall exceed the standard rent shall, notwithstanding the fact that no valid and effective statutory notice has been served on the tenant in conformity with sub-section (2) of section 3 of the Act of 1920 or sub-section (1) of section 7 of the Principal Act as the case may be, be deemed to be and always to have been a valid and permitted increase of rent and not to be or ever to have been a sum irrecoverable from the tenant within the meaning of section 1 of the Act of 1920, or section 12 of the Principal Act, as the case may be, or recoverable by the tenant within the meaning of sub-section (1) of section 14 of the Act of 1920, or sub-section (1) of section 15 of the Principal Act, as the case may be.

(2) Nothing contained in the foregoing sub-section shall affect the rights of a tenant under paragraph (c) of sub-section (1) of section 7 of the Principal Act.

(3) This section shall not entitle a landlord to recover from a tenant any sums which have been recovered from the landlord before the 4th day of May, 1926, by means of deduction from rent or otherwise or any rent which has not been paid by reason of such deductions having been made therefrom.

(4) This section shall not affect the right to enforce any judgment of a court of competent jurisdiction given before the 4th day of May, 1926, or render recoverable any sum paid under such a judgment.

CATHAOIRLEACH

I think we had better take amendments 3 and 4 together.

Sir JOHN KEANE

I move:—

Section 7, sub-section (1). After the word "which" in line 58 to insert the words "does or."

Section 7, sub-section (1). After the word "rent" in line 5 to insert the words "to the extent only that it does not exceed the standard rent together with such permitted increases."

The matters dealt with in these two amendments are a little complicated, and I must ask to be allowed to say a few words in explanation. The points involved are really legal ones. The Legislature, in the Act of 1920, permitted certain increases in the standard rent, and then, to the surprise of all, there came the decision in the case of Kearney v. MacBride, which said, in effect, that all increases allowed by the Act are invalid unless a formal notice to quit was served, or, in other words, that the tenancy was determined. The landlord and the tenant both might enter into an agreement in good faith. The tenant had no idea there was this technical flaw and fully expected to pay his increase, but somebody, of a legal turn of mind, discovered this flaw and the effect of it was to render all increases, prior to that date, invalid, unless a notice to quit had been formally served. The British Government recognised this injustice, and proceeded by legislation to put the technicality right. Here in the Free State in future no tenant can refuse to pay an increase owing to the omission to serve a notice to quit; where increases have recently been calculated, where, in effect, a new tenancy is agreed on, further increases than that allowed by the Act would be purely by omission or error. After all the tenant would never pay an increase if he thought it was not legal, but where both parties have made some mistake, if the actual increases are greater than that allowed by the Act, this new section would not apply, and any agreement previously invalid will remain invalid. What we ask is that the agreement should be validated so far as permitted increases are concerned. We do not think it is fair that increases should be invalid by omission where the permitted increase has existed and we only ask for validation of the existing increased rent. That is the effect of the amendment.

Mr. O'HIGGINS

It is a difficult matter as the Senator admitted to make the precise effect of these two amendments quite clear. As I understand the effect of the amendments or what the Senator aims at is to validate an agreement for a new tenancy reserving a rent which exceeded the standard rent by more than the permitted increase. It aims only at validating such an increase to the extent of the standard rent, plus the increase permitted, under the Act. There is an attempt to divide up this agreement. The agreement might be outside the Act and for an amount above the permitted increase, and to say that there shall be protection at least to the extent of the increase permitted by the Act would mean drawing a distinction between that part which complies with the provisions of the Act and that which is outside the Act. If the Senator feels I am not putting the effect of his amendments accurately I have no objection to his intervening.

Sir JOHN KEANE

I do not read it that way. I suggest where an agreement has been made outside the Act and where the permitted increases have been exceeded, the law will only right that to the extent of the excess. The agreement will still remain good in respect of the permitted increase.

Mr. O'HIGGINS

Then we are really at one. It is simply that I have put it in a different formula from the Senator. He says that where agreements have been made which were bad, invalid and illegal because they were in excess of the increases permitted by the Act that then there shall be protection for so much of that as was within the Act and the law will only intervene in respect of the amount which infringed the Act by being excessive. I am clear that I am at one with the Senator, that we both mean the same thing, and on that basis I oppose his amendments. I oppose them simply because I take the view that it is unwise, in our legislation, when in the past Parliament, in certain provisions with regard to the relationship between landlord and tenant, drew straight, hard and fast lines as to the rents that were to be charged, fixed penalties in respect to breaches of that legislation and so on, that we should come in and retrospectively validate, to some extent at least, agreements that were bad and illegal in themselves and that we should give protection to the extent of three-quarters, or seven-tenths at any rate, of the amount that was within the law to the house-owner who made that bad and invalid agreement.

The whole policy of the Rent Restrictions Act was to lay down the maximum amount of rent chargeable in any case. Elaborate machinery was provided, calculations and so on, to fix the rent that would be legal. The Senator says that where a house-owner made a bargain with his tenant, and he was perhaps ignorant of the law, or insufficiently advised as to his rights, outside the Act for an amount greater than the amount laid down by the Act, that he should be protected up to the limit of the permitted increase and only in respect of the illegality should the agreement be upset. The maximum rent was laid down by law. The parties were forbidden by law to contract outside the provisions of the Act of 1920 and the subsequent Act of 1923. If the landlord took the risk of demanding and receiving from his tenant a rent which we must presume he knew to be in excess of that to which he was legally entitled, there seems no good reason for now affording him protection and entitling him to recover the rent permitted by the Act which he flouted and outside of which he made his contract. I feel I should be very unwise to accept an amendment, the underlying principle of which I believe to be bad and vicious in the sense of being utterly unsound legislation.

Mr. FARREN

I must congratulate the Minister on the attitude he has taken up in regard to this amendment. This amendment wants this House to relieve a man from an illegal act because house-owners in their greed took advantage of the position and compelled people to enter into agreements with them to pay rents which they were not justified in charging. They scooped in rent which they were not entitled to receive and when they are found out now, they come and say: "We did not mean it." This House cannot be expected to pass legislation to legalise direct infringements of an Act that was passed. If we accepted the principle Senator Keane advocates, it would be very dangerous.

Amendment put and declared lost.

Sir JOHN KEANE

I move:—

In Section 7, sub-section (3). To delete in line 17 the words and figures "4th day of May, 1926," and substitute therefor the words and figures "24th day of December, 1925."

In moving this amendment I shall have to deal again with the notice to quit provisions from a rather different angle. I said in a previous amendment that very shortly after this technical omission in respect to the notice to quit was discovered in Great Britain, legislation was introduced to put it right. In the debate on the Second Reading the Minister gave the House to understand that it was also the wish and intention of the Government to remedy the omission here in Ireland in the 1923 Act. They had before them then the judgment of Carr and Byrne with regard to the new agreement as to increases of rent under existing tenancies and they had the most extraordinary judgment, if one may use such an epithet with regard to legal matters, in the case of Schmidt versus Christie, which was the case of a new tenancy. There still had to be a notice to quit, and how a man who had not entered into possession may get a notice to quit, I cannot see. Apparently the new tenant had to be put in and then given a notice to quit and this was put in in order to do homage to this extraordinary legal technicality.

The Government had knowledge of these two details when introducing the Act of 1923, and they said it was their intention to prevent any of those technicalities arising. Yet all the time after that Act was passed these judgments continued to be given in favour of the tenant. I ask the Government to say by what section of the Act of 1923 any protection was afforded. There is the Act of 1923, right up to the present day, through which a number of landlords have been deprived of their legal increases simply on account of this technicality. In fact, tenants have been on pre-war rent for three years after the injustice was known. One obviously asks: why did not the Government act sooner? It was not that they did not know. They were approached by organisations representing house property owners. They allowed these pre-war rents to remain in existence up to the present date. It is not clear what great advantage the capitalist Government has given to the capitalist class. A large number of tenants have been on pre-war rents and are still on pre-war rents owing to an omission to which I suggest the Government are at least a party.

It will be said at once that this amendment is retrospective, and we do not like retrospective legislation, except, if I may say so, when it suits us. We all subscribe to the principle when it meets our case and admit it when it suits us to do so. Whether retrospective legislation is right or wrong must be tempered by circumstances, and in this case we ask for a compromise that at least a wrong now to be remedied should be remedied as from December last. We suggest it should be remedied from June, 1923. We say it is very tardy justice to ante-date that provision six months and to allow any increase to be made good within that six months. Tenants have had about three to five years of pre-war rents, and to ask them to pay six months of those increases does not seem unreasonable. There are a number of consequential amendments, but the principle of this will dispose of a great many of them.

Mr. O'HIGGINS

Senator Sir John Keane has raised the general question of this notice-to-quit point which has given a good deal of trouble. In that connection I should like to refer to the report of the Departmental Committee of the Increase of Rent and Mortgage Interest Restriction Act, 1920, on which report the Act of 1923 was based, and in particular to paragraph 34 of that report:

"We do, however, think that the prescribed forms should include the form of a combined notice to quit and notice increasing the rent in the event of the tenant retaining possession under the provisions of the Act. As to payments made by tenants on foot of notices to increase rent which were inoperative owing to the failure of the landlord to determine a tenancy under a notice to quit, we do not think that the excess of such payments over the agreed rent is an amount which can be recovered back by Section 14 of the Act of 1920, as it does not seem to us to be an excess payment under Section 1. The point has not been decided in Ireland."

The substance of the notice-to-quit point was this: that it was held that where, without recourse to the machinery of the Act at all, the landlord, the house-owner, agreed with the tenant on an increased rent and where that increase was within the range permitted by the control legislation, the tenant was, nevertheless, entitled to recover the amount of that increase from the landlord on the ground that no increase of rent was permissible save within the provisions of the Act, and under the procedure laid down by the Act and that the notice to quit was necessary to bring the parties within the Act, terminating as it did, the old relationship, and creating thereby a new statutory relationship under the Act. It may seem to lay-people that it is a very extraordinary and inequitable state of affairs that where A. and B., landlord and tenant, agreed on an increase of rent and that the increase of rent does not exceed the amount permitted by the legislation, it should be open to the tenant subsequently to go to the Court, set the machinery of the law in motion, and recover from the house-owner the amount of any such increase he may have paid. Yet that is what has happened. Tenants have been able, by resort to Court process or by simple deductions of their own from the rent due to their landlord, to secure a recoupment of increases paid to the landlord on foot of an agreement even where the increase which they agreed upon was not outside the range permitted by the legislation. The reasons for that are that the law provided that there should be no increase of rent save as laid down by the Act, within the machinery and according to the procedure of the Act, and for the creation of a new statutory relationship the termination of the old relationship by a notice to quit was a condition precedent.

Senator Sir John Keane makes the point that we should have legislation long since to cover this flaw. The fact is that the matter—I might even say to date—has never been finally determined by the Courts here. A test case has never been brought to the highest court here and I have no doubt whatever that there are many lawyers who would tell me even now that it was a matter of doubt, at any rate, as to whether the tenant was in fact entitled to recover in that way by legal process or in any way to withhold from his liability to his landlord all increases arising from an agreement which were outside the range of the increases permitted by the Act. My committee at any rate, the Committee on whose advice the Act of 1923 was based gave it as their opinion: "We do not think that the excess of such payments over the agreed rent is an amount that can be recovered back under Section 14 of the Act of 1923, as it does not seem to us to be an excess payment under Section 1. The point has never been decided in Ireland."

It is not a long time since we discovered that here in the Free State the law was running in a manner adverse to house-owners. A year ago we began to have, perhaps, doubts and qualms on the matter and we are legislating now, but no test case was brought by house-owners who had their associations, powerful associations, in Dublin and in Cork, to have the matter determined authoritatively. They hoped for the best, and time went by and each one fought his own battles in the Circuit Court or County Court, but there was a lack of final and authoritative decisions following on which legislation could be introduced. Here, at any rate, is our proposal: that we draw the line as from the date of the introduction of this Bill, and we say that there should be no more of this recoupment process as from that date. I am quite clear that I would not be doing wisely in accepting the Senator's suggestion, that I should strike back to December, 1925, and open up transactions that have been closed, and that have been disposed of, either by positive refunds or by withholding, which seems to have been in accordance with the law as it stood. I am not willing to do it. I would not sponsor a Bill that would contain any provision of that kind. It is not in terrorem that I say it; I can only say if the provision is inserted here I would not go on with this Bill.

Sir JOHN KEANE

Of course the Minister has given his answer. We have to make the best of it, but I would not like his address to pass without replying to one or two points. I rather feel that he is simply standing now again on one of these pure technicalities that have been the root of all this trouble. He did not deny the injustice of the technicality, but surely the Minister's argument is now based on a technicality. He says that these cases have never been finally determined by the courts. In fact he implies that if this matter had gone to the Appeal Court and had been decided as against the tenant, that then he would legislate. After all, what did happen? A case went to the High Court and the usual judgment followed—that the tenant was right. In regard to this powerful association that the Minister referred to—I like to have his endorsement that it is powerful—I may tell the House that the house property owners could not take every case to the Appeal Courts. In any case we did not think it worth while going to the Appeal Court in face of the High Court judgments and the House of Lords judgments. I do not know what effect the House of Lords judgments have here, or even if they are allowed to be quoted in the Free State Courts. In any case, the judgments are known, and the judgments in exactly similar cases must have been the same in the Court of Appeal. That is the reason that I suggest it is a technicality to say that the omission is ours, and that the house-owners are to blame for not carrying it through to the higher courts. I will not say—I will leave it to the House to judge—whether the Government would be likely to act differently had the case gone to the courts and been decided in the manner that everybody knows it should have been decided.

Mr. O'HIGGINS

If the Senator would allow me to interrupt for a moment, I would like simply to say that throughout the period there were lawyers of very considerable standing here prepared to say that this recoupment process was not in accordance with the law.

Sir JOHN KEANE

Our Association was also advised. In view of the judgment previously given, they felt, and our advice was, that where a case was entirely governed by the previous judgments in the matter, that would determine the issue. The Minister says he is unable to accept the principle and that we will lose this Bill if this is carried. The answer is obvious. The House must do it. We do not want to lose the Bill now because as I said on Second Reading it contains certain valuable provisions. On that account I beg to withdraw the amendment.

Amendment, by leave, withdrawn.

Section 7 put and agreed to.

Sir JOHN KEANE

I beg to move:

Before Section 8 to insert a new section as follows:

"8. The Principal Act shall be construed and have effect as if Section 4 thereof were amended as follows, that is to say:

(i) By the deletion of so much of paragraph (d) of sub-section (1) of the said section as begins with the words "and in the opinion of the court," and ends with the words "granting it."

(ii) By the deletion of so much of paragraph (e) of sub-section (1) of the said section as begins with the words "and in any such case," and ends with the words "such judgment."

The effect of this amendment will be to amend the Principal Act to ensure that where a landlord requires a residence let and under control, for himself or for any bona fide person residing with him, or about to reside, or some person in his whole-time employment or in the whole-time employment of some tenant, he shall automatically, ipso facto, obtain possession. It shall not rest with the Court to say whether any hardship is due to such possession but in fact will take away the discretion of the court. The landlord perhaps, bona fide, requires the possession of the premises for himself or for somebody in his employment and he shall get them there and then and it shall be the duty of the court to give him a decree for possession. Bad as the housing shortage is, it is not so bad as it was. There is a large number of houses being built now and the pressure is being eased to some extent and the abuses are being sufficiently removed. It is not necessary to have these cases dragged into court and have a lot of arguments advanced as to hardship. Many of them are very easily produced and very hard to controvert and, as the Minister says, the property belongs to the landlord and not to the tenant, and to that extent he should enjoy the rights of ownership.

Mr. O'HIGGINS

If Senators have the Principal Act they might refer to Section 4, which is a section which lays down the restrictions on the landlord's right to possession. The Act says: "No order or judgment for the recovery of possession of any dwelling-house to which the Act applies, or for the ejectment of a tenant therefrom shall be made or given unless—" and then it sets out a series of conditions under which such orders may be given. The first portion of the Senator's amendment is to delete in paragraph (d) all those conditions. I had better read the paragraph as a whole and then advert to that portion which is sought to be deleted:—

"No order or judgment for the recovery of possession of a dwelling-house to which this Act applies for the ejectment of a tenant therefrom shall be made unless:—(d) the dwelling-house is reasonably required by the landlord for occupation and as a residence for himself or for any person bona fide residing or to reside with him or for some person in his whole-time employment or in the whole-time employment of some tenant from him, and in the opinion of the Court greater hardship would, owing to the special circumstances of the case, be caused by refusing the order for possession than by granting it."

The Senator seeks to delete from the paragraph the portion which places on the court the onus of deciding whether greater hardship would result from granting the order for ejectment than by withholding it. Now I do not approve of the proposed deletion. I know that the judges have found it somewhat onerous and invidious to administer that paragraph of the Act. But I think it is necessary to our whole conception of house-control that something of the kind—some duty and onus of the kind—should lie with the courts, that some discretion, some task of examining the circumstances and deciding in the light of circumstances, should be on the judges. If house-control is necessary, as we think it is, and of course we gave evidence of that in introducing this Bill, then it is inevitable that for certain purposes a broad discretion would be vested in the courts to decide in a human way, after examination of the circumstances of the case, whether the house-owner should, in fact, be allowed to resume possession of his house. Now we are saying here that it shall be open to the courts to grant an order if certain conditions are present: If a dwelling-house "is reasonably required by the landlord for occupation and as a residence for himself or for any person bona fide residing or to reside with him or for some person in his whole-time employment or in the whole-time employment of some tenant from him," and then we add: "and in the opinion of the court greater hardship would, owing to the special circumstances of the case, be caused by refusing the order for possession than by granting it." Senator Sir John Keane's point of view is quite clear. He says in effect "The house is mine; I want it. I can show a good case for resuming possession. Get out."

The court is to take that line. "A" wants the house and it is his. He can show certain reasons why it would be convenient for him to resume possession, and "B," the tenant, must get out regardless of circumstances, regardless of alternative accommodation. The principle and the whole basis of this legislation is acute housing shortage, insufficient houses to meet the needs of the community. If we grant that basis, if we grant the existence of that state of affairs, is it too much to say that the court, before granting an ejectment order, should examine in a reasonable way the circumstances of the case, and come to a conclusion as to whether it would be a more harsh or more unfair thing to withhold the order than to grant it? It may be a very difficult and invidious task for the judges. But I submit it is necessary, and it arises necessarily from that position which is the basis of our legislation. In that view and in that belief I ask the Seanad not to accept this amendment for incorporating it in the Bill.

Mr. FARREN

I think Senator Sir John Keane ought to be very grateful to the Minister for protecting him against himself. Because it appears to me that if Senator Sir John Keane got passed all the amendments that he wants to-day we would have a new Plan of Campaign started, not in the country, but in the city. It is all very well to get possession of a house, but remember the man who is fixed with his little family in a house, and who is prepared to pay his way and to pay his rent, is not going to be put out and left without shelter for his wife and children to please the house-owner. If he is prepared to pay a fair rent as laid down by the law, he is entitled to that house irrespective of the rights of capital. Capital has its rights, but it also has its responsibilities. Capital by itself would build very few houses. If you piled all the capital that is in this country and put it together into a bank, and left it there until Tibb's Eve it would not have erected very many houses, and therefore it could not demand possession of those houses if there had not been somebody else to build them and to inhabit them. One would expect that at this time of day Senator Sir John Keane would not bring forward this amendment; one would really suspect that these people think they are living in the Stone Age, and that they have a right to insist on having everything they wanted done. They must remember that at this time of day other people living in the community have certain rights also. If a man is a tenant of a house, and if he is prepared to pay a fair rent, as laid down by the State as being a fair rent, it is not fair that because there may be an acute shortage of houses at the moment the landlord should be entitled to come along and say to him: "I want you out of this house, because I can get a higher rent, or I can sell this house at a big price."

Senator Sir John Keane nods his head, but he knows very well that what I am saying is true. It is laid down in the Act that if a landlord goes to court, and can prove to the court that he wants the house, it is for the judge to say if a greater hardship would be inflicted on the tenant in possession, and if he is entitled to consideration. Otherwise the landlord is entitled to possession. That is the position as I understand it. I think Senator Sir John Keane ought to be very grateful to the Minister for the protection he has given him and his class to-day by saving them from themselves, because eventually they would destroy themselves.

Sir JOHN KEANE

I do not deny the protection the Government has afforded to house-owners and the concessions given, but in this particular matter the scales are weighted in practice against the landlord, and while they are, it is always far easier to make out a hard case on the side of the tenant in possession than it is to make out a strong case for the landlord. That is what it comes to. The man in possession, whatever the circumstances, can produce innumerable reasons why he should not be put out. The man who is not in possession has probably a house somewhere else, though it is not his own. All these are preliminary to decontrol. As far as I can see, the policy of the last Senator who spoke is that there shall never be any decontrol. Well, if we are faced with that, I ask how are we to get houses built? Houses are not built by Government agency. The only way in which we can get houses built is by making house-building, as it was before the war, an attractive commercial speculation. Until we get back to those conditions, the housing difficulty will remain.

Amendment put and negatived.

CATHAOIRLEACH

The next amendment on the paper is No. 7. It is an amendment by Senator Sir John Keane.

Sir JOHN KEANE

That goes.

Amendments 7, 8, 9, and 10 not moved.

Question—"That Section 8 stand part of the Bill"—put and agreed to.

Section 9 put and agreed to.

Sir JOHN KEANE

I move:—

Before Section 10 to insert a new section, as follows:—

"10.—The Principal Act shall as from the 24th day of June, 1926, be construed and have effect as if Section 17 thereof were amended as follows, that is to say, by the insertion therein of the following sub-section:—

(5) The application of this section to any house or part of a house shall not be excluded by reason that part of the premises only is used as a shop or office, or for business, trade or professional purposes."

The Act allows a higher increase on the rent of business premises than on the rent of dwelling-houses, and so naturally tenants are striving to give business houses the character of dwelling-houses, and in some cases it is done by merely furnishing one or two rooms in a business house and calling it a dwelling-house and then bringing it under the lower scale of increase. The amendment, if approved of, will have the effect of making any house in which business is carried on, irrespective of the extent of that business, subject to the higher increase. I have been arguing all along that the hardest hit class in the community since the war have been the owners of house property. I think that has been justified by the increase of rent when compared with the increased price of commodities. If possible, in these border-line cases, the owners of house property should get the benefit of any doubt, and the benefit of any increase should go to them. The State is inflicting an injustice on house-owners in these cases. Houses in which business takes place, to whatever extent, should be classed as business premises, and be subject to the higher increase.

Mr. O'HIGGINS

This amendment, or something like it, was moved in the Dáil and rejected. It is an attempt to remove houses which are used partly as dwelling-houses and partly as business houses from the category of dwelling-houses, under which they come under the provisions of the Act of 1923, and to bring them out of the category of business houses. I am opposed to this amendment. The only business premises affected by the Act of 1923 are premises let for a less term than a tenancy from year to year. The houses that are let in that way for a less term than year-to-year tenancies, are mostly of the huckster shop variety, or lock-up shops, so that in fact the Senator seeks to bring within the category of business premises quite small dwelling-houses which are partly used for business purposes. I made some inquiries with a view to making up my mind on an amendment of this kind which was proposed in the Dáil. My information is that this class of house is one which requires the restrictions imposed by the Act, that it would not be in the general interests to permit the owners of such premises to secure from the tenant the larger increase permitted in respect of business premises. I do not feel that I can accept the amendment.

Sir JOHN KEANE

It is rather disappointing after the sympathy the Minister expressed earlier, when he said that if a good case could be made out for a higher bonus he would not oppose it, that now when one tries to effect that purpose as regards a rather remote and very limited section of house property he will not meet us. I feel this is a case where we might have expected some concessions. I was hoping that the House might assert itself sooner or later in the matter of these amendments. Of course, it is a complicated measure, and some members might not have had an opportunity of studying it, and the House seems to have put itself into the hands of the Government. While one appreciates certain concessions the Government have made I think they should have gone further in this case, and I press the Minister to do so.

Mr. O'HIGGINS

On the point of sympathy, the Senator cannot expect both sympathy and concession. It looks rather like grasping. If he presses for the concessions he alienates the sympathy. It is because I am not able to give the concessions that I am giving the other. The matter has been carefully considered, and my information is that down through the country, in the provincial towns, an attempt is being made to raise, and raise very appreciably, the rents of small houses in which, perhaps, in one small room is some little kind of a huckster's shop, where starch and matches, and things like that, are sold. Houses of that kind are for all practical purposes dwelling-houses with a side show, and I think that the amendment would have reactions of a kind which the Senator himself would not desire, and which I doubt he has sufficiently considered.

Sir JOHN KEANE

I have considered it, and I suggest that I am in favour of effecting reforms in other directions by legislation. We heard all along of the undesirable number of these small distributing houses, and that is one of the arguments, if my recollection is right, quoted as an explanation of these high prices—so many more shops than are needed, all having to make a living, and, therefore, having to charge more than a fair margin of profit. This amendment would have the effect of closing these shops. Their stock-in-trade is not very large, being mostly confined to what is in the windows, and it would not be undesirable where they are retained as business premises that the landlord should get the larger increase. I make that point for what it is worth.

Amendment put and, on a show of hands, declared lost.

Amendment 12 not moved.

Sections 10, 11, 12 and 13 put and agreed to.

SECTION 14.

On the hearing of an action for the recovery of any rent claimed to be due in respect of a dwelling-house to which the Principal Act as amended by this Act applies the Court may on the application of either party at such hearing determine any question arising under this Act which can in the opinion of the Court be conveniently determined on such hearing.

Sir JOHN KEANE

I move:

After the word "applies" in line 60 to insert the words "or for the recovery of possession of same, or for the recovery of alleged overpayments of rent in respect of same."

I am in hopes that I may get something to take home out of this amendment, for it is practically a drafting amendment. Section 14 was not in the original Bill. It was inserted, in response to capitalist pressure it was suggested in the other House, but the effect of it is that in any action to recover rent all issues relevant to the case should be tried at the same time. It was the practice when a landlord sought to recover rent that all kinds of technical objections were raised with a view to prolonging the proceedings unduly. There is a legal phrase which applies to these tactics, such as motions for discovery of documents, and so on.

The Government considered that was not right and they introduced Section 14, which lays down that where there is an action for the recovery of rent all issues pertinent, all counter-issues, should be raised and tried at the same time, such as that the standard rent was wrong, or that notice to quit had not been served. That simultaneous hearing of all issues applies only to an action for the recovery of rent. Of course, the landlord may wish to do other things than recover rent. He may wish to recover possession, or the tenant may wish to recover alleged over-payments of rent. I wish to bring these two cases—an action for the recovery of possession, and an action for the recovery of alleged over-payment of rent—within the section, so that where an action lies for the recovery of rent, or for possession, or for over-payment, all pertinent and ancillary issues should be heard and decided at the same time. The next amendment, which really hangs on it, is that such determination shall be final and conclusive, and that there shall be no appeal.

Mr. O'HIGGINS

The effect of the amendment is to enable the court to decide upon questions arising under the Act in proceedings for the recovery of possession of premises or the recovery of alleged over-payments. The Act of 1923, I think it is sub-section (4) of Section 4, confers such a right on the court in cases for the recovery of possession. I am prepared to consider before the Report Stage, if the Senator would agree not to press his amendment, the inclusion in Section 14 of the other proceedings set out in the amendment, namely, to proceed for recovery of alleged over-payment of rent, and for possession. I would be glad if the Senator would allow me to consider that between now and the Report Stage.

Amendment withdrawn for consideration on Report Stage.

Amendment 14. To add at the end of the section the words "and any such determination shall be final and conclusive and not appealable."

Sir JOHN KEANE

What the Minister has said with regard to the previous amendment, I take it, also applies to Amendment 14?

Mr. O'HIGGINS

I am afraid I could not give any undertaking about Amendment 14. I have considered the amendment, and I have come to an adverse decision about it. Under the 1923 Act the only decision the court made final and conclusive was the apportioning of rent, and the rateable value. I do not see why a person who thinks he has a grievance arising, say, from the determination by a District Justice, as to the standard rent, should not be able to appeal to the Circuit Court. Parties have a general right of appeal under the Court of Justice Act in all civil cases, and I think we ought to be conservative in limiting that right of appeal. I do not see why in the matter of standard rent, if a person thinks a District Justice has made a mistake, or given a wrong decision, he should be debarred from bringing that matter to the Circuit Court.

Colonel MOORE

I think that section is rather hard on the occupier. Law cases, as everybody who has had anything to do with law knows, are extremely expensive, and the general result is ruin to both parties. The richer man has the best chance of winning, for he can afford to bring lawsuit after lawsuit, and the poor man who is not able to fight them has to give up. I think it would be an advantage to the occupier himself that the thing should be settled once and for all, and not to be going from court to court until he is not able to fight any more.

Amendment, by leave, withdrawn.

Section 14 put and agreed to.

Sir JOHN KEANE

I move:—

Before Section 15 to insert a new section, as follows:—

"15. From and after the 24th day of June, 1926, it shall be deemed to be a condition of the tenancy of a tenant who by virtue of the provisions of the Principal Act as amended by this Act retains possession of any dwelling-house to which the Principal Act as amended by this Act applies, that the tenant will not sub-let the dwelling-house or any part thereof without the consent in writing of the landlord, to be expressed in an agreement, in writing, signed by the landlord, the tenant and the proposed sub-tenant, and providing that one quarter of the profits of any sub-lease is paid to the landlord, and three-quarters to the tenant."

The Minister told us that sub-letting was illegal.

Mr. O'HIGGINS

No.

Sir JOHN KEANE

I withdraw. I understood the Minister said he was advised that sub-letting was illegal.

Mr. O'HIGGINS

I said I was advised that sub-letting was gripped by the Act and that there was a remedy under the Act for a sub-tenant who held that he was being charged an excessive rent.

Sir JOHN KEANE

The mistake was mine.

CATHAOIRLEACH

I think the view was that tenants who sub-let become, for the purpose of the Act, landlords.

Sir JOHN KEANE

Profiteering is a word that I do not like to use, but in practice there is profiteering. The tenant who sub-lets gets the whole profit from property on which he never spent a penny. It is an easy way to make money to get into someone else's house and sub-let at a profit. It is suggested that the practice should be recognised, but I realise that that would be recognising something that would be illegal. To divide the spoils between the landlord and the tenant would be in the nature of condoning a felony. It would be tantamount to entering into an illegal conspiracy. At the same time we should recognise facts that have arisen in interpretation of the Act and which have never been decided. I have asked in certain informed quarters how the standard rent is fixed. It is a most bewildering question. That is why the cases were never brought before the Court. It is the undoubted fact that tenants in some cases are obtaining large profits out of houses in which they are living under the protection of the law. That being the fact, would it not be just and reasonable to recognise it until it is upset? It is only an opinion whether these sub-lettings are subject to the Act. In the meantime why should the landlord be deprived of any share of the profits from the sub-letting? The effect of this amendment will be that in future sub-lettings will be made by agreement between three parties, the landlord, the tenant and the sub-tenant and that no agreement should be legal unless the three parties are concerned. I admit that if the principle is accepted the amendment could be put into legal form, the landlord to get one-fourth and the tenant three-fourths out of the profits.

Mr. FARREN

I have a good deal of sympathy for people who are sub-tenants and who are being fleeced. At the same time I am of opinion that this is the most audacious proposal we have yet had from Senator Sir John Keane. The Senator complains of the grievance people have who have not been able to secure suitable accommodation because of the scarcity of houses, and whom circumstances have forced to become sub-tenants in a couple of rooms. The Senator said these people are being fleeced. We all know that they are being fleeced, and we are sincerely anxious that those who fleece them, whether they are of the working class or of any other class, should be got at and prevented from charging exorbitant rents for portion of their premises. I could astonish Senators if I told them what is occurring in Dublin. I know ocupiers of houses who are not only living rent free but who are also having a little profit by sub-letting portion of their houses.

Mr. GUINNESS

I should like to ask the Senator if he is in favour of permitting sub-letting in such tenancies?

Mr. FARREN

I am not in favour of sub-letting as a principle but I am forced to admit that it is necessary owing to the shortage of houses and in order to provide homes for the people. I assume that the Senator agrees that young men and young women are entitled to get married and become good citizens. There are large numbers of young people in Dublin who cannot get married and set up homes because no suitable accommodation is available. Many who have got married are compelled to take rooms. It is because of that position that I think we must tolerate this system of sub-letting. I welcome the Minister's statement that he is going to control sub-tenancies. I do not agree with Senator Keane's amendment that we should allow the landlord and tenant to conspire in order to skin the unfortunate person who becomes a sub-tenant, and then to divide the spoils between them. The Senator was quite frank about the matter. He said that the spoils could be divided. We cannot allow that, and I hope the Minister will not consent to such a proposal. It is a vicious one. I agree that some action will have to be taken with people who are sub-letting rooms and demanding exorbitant rents. I was glad to hear the Minister say that he is advised that these sub-tenancies come within the meaning of the Act. I hope that statement will be made publicly. If it is there will be startling results.

CATHAOIRLEACH

Would it not be better if it was made plain in the Bill that where a tenant is sub-letting a portion of a dwelling-house he should occupy the position for the purposes of this Act of landlord? If that is made plain a simple remedy would be to do so by definition.

Mr. O'HIGGINS

According to the Principal Act of 1923 sub-section (1) of Section 3 reads:

"This Act shall subject to the provisions of this Section apply to a house or part of a house let as a separate dwelling where either the annual amount of the standard rent or the rateable value does not exceed:

(a) in the county borough of Dublin and the Urban Districts in the Dublin Metropolitan Police area sixty pounds, and

(b) elsewhere, forty pounds,

and every such house or part of a house shall be deemed to be a dwelling-house to which this Act applies.

It is on that sub-section (1) that I base—not so much my contention, as I doubt if it is even a contention—my statement that sub-letting is governed by the 1923 Act and by this Bill. Turning back to Section 2 and remembering that "every such house or part of a house shall be deemed to be a dwelling-house to which this Act applies," you find it provides that the standard rent shall be determined in the following manner:

(a) If the dwelling-house (which includes part of the house) was on the third day of August nineteen hundred and fourteen let to an occupying tenant under a contract of tenancy not being for more than a term of five years, then the rent at which the dwelling-house was so let, or, where the dwelling-house was not so let on that date, the rent at which it was last, within a period of three years, so let before that date, shall, subject to the deduction specified in the next succeeding sub-section, be the standard rent.

Let us take a particular two or three rooms which were never sub-let by the tenant before but which he was compelled to sub-let. The next paragraph (b) says:—

In any case not coming within the last preceding paragraph the standard rent shall be determined by the court on the application in the prescribed manner of the landlord or the tenant: Provided that pending any such application to the court, the rent at which the dwelling-house was let on the 3rd day of August, 1914, or, where the dwelling-house was not let on that date, the rent at which it was last let before that date, or, in the case of a dwelling-house which was first let after the said 3rd day of August, the rent at which it was first let shall, subject to the deduction specified, in the next succeeding sub-section, be the standard rent.

"Under the 1923 Act the expression ‘landlord' also includes in relation to any dwelling-house any person, other than the tenant, who is or would but for this Act be entitled to possession of the dwelling-house, and the expression ‘tenant and tenancy' includes sub-tenant and sub-tenancy, and the expression ‘let' includes sub-let; and the expression ‘tenant' includes the widow of a tenant dying intestate...."

It is clearly stated that where the words "tenant and tenancy" are used throughout the Act there is included in that "sub-tenant" and "sub-tenancy," and where the word "let" occurs there is included "sub-let.' From the definition contained in sub-section (1) of Section (3) of the 1923 Act it seems quite clear that there are envisaged control and restrictions by this legislation, not merely to letting by house-owners to a tenant, but also sub-letting by a tenant to a sub-tenant. Passing from that to the Senator's amendment, clearly the idea is to make it a condition of tenancy under the Act that a tenant shall not sub-let "without the consent in writing of the landlord, to be expressed in an agreement in writing, signed by the landlord, the tenant, and the proposed sub-tenant, and providing that one quarter of the profits of any sub-lease is paid to the landlord and three-quarters to the tenant."

Tenants under this controlled legislation hold subject to the conditions of their original contract of tenancy, and to certain conditions imposed in the Act, one of which is directed against assignment without the landlord's consent. Accordingly, a tenant who by his original agreement was free to sub-let is still free to sub-let. To impose a condition now against sub-letting without the consent of the landlord would mean in effect that no sub-letting could take place, and it must be recognised that the housing shortage has to a considerable extent had to be met—I do not say it is a good thing in itself—by sub-letting. It may be contemplated that landlords would not consent to sub-letting, as they hold the view that it depreciates their property.

Apparently the Senator thinks that large profit rents are received by tenants from sub-tenants. But I put forward the contention, and I am supported in my view by the Attorney-General, that the relationship between tenants and sub-tenants is controlled by the Act in the same manner as the relation between tenants and landlords, and it is open to the sub-tenant by an application, under the Act, to guard against recovery by the tenant from him of any rent other than that permitted by the Act. Therefore, I take two grounds really. Firstly, it is not desirable, in face of the housing shortage, to restrict sub-letting. Secondly, in so far as there is exploitation in connection with sub-letting, if people are active in the assertion of their rights there is provision against it under the 1923 Act, and there is provision against it in this Bill. In the circumstances, I am not prepared to write into the Bill a provision that there can be no sub-letting without the consent of the landlord. I am quite clear, in my own mind, that many landlords would take the line of refusing to agree. I am not prepared to write into the Bill that the landlord shall share to the extent of one-fourth the rent charged to the sub-tenant. The immediate result of that would be, I fear, a substantial increase in the rents that are being charged to sub-tenants at the moment.

Mr. FORAN

I have no sympathy whatever with Senator Sir John Keane in the amendment he has moved, but I would like to ask the Minister what is the position of people who occupy flats where there is not an actual tenancy. The original owner of a large house in some of the residential quarters in Dublin arranges to let his house in flats. In what way is he restricted under this Bill? or to what extent has the occupier of the flat a legal remedy to enforce a fair rent as against the landlord?

Mr. BENNETT

I was going to ask the same question. Under the 1923 Act there seems to be no machinery to determine the rent in that case. Therefore, I take it that in the case of the letting of flats any rent at all can be inflicted upon the tenant. I certainly think that to put into legislation or to tolerate an agreement as to rent such as has been suggested by Senator Sir John Keane would be something that the Seanad should be very slow to do. We are asked by the amendment to put something into an Act of Parliament limiting the rent that can be charged for a place that was never let before because unless a place was let before it does not come in under the 1923 Act.

Sir JOHN KEANE

I would welcome any amendment that would make quite clear the condition of the law with regard to sub-letting. That is not in the Act. It is not so much that we feel the profits made by sub-letting have been wrongfully made, but that this sub-letting very much deteriorates the property and increases the cost of repairs. In the public interest it ought to be controlled, and the benefits that apply to tenants under the law should also be applied to sub-tenants.

Mr. O'HIGGINS

In answer to Senator Foran I may say that I feel there is no doubt that, taking Section 5 of the present Bill, a flat is covered by sub-section (2):—

"Where part of a dwelling-house to which the Principal Act applies is lawfully sub-let and the part so sub-let is also a dwelling-house to which the Principal Act applies, the Principal Act shall not, by virtue of this section, cease to apply to the part so sub-let by reason of the tenant being in or coming into possession of that part, and if the landlord is in or comes into possession of any part not so sub-let the Principal Act shall cease to apply to that part notwithstanding that a sub-tenant continues in or retains possession of any other part by virtue of the Principal Act."

There is an exception to that. Senators would want to have the Principal Act by them for reference because, of course, this Act is a continuing of the Act of 1923 with modifications. In sub-section (5) of Section 3 of the Principal Act there is the following:—

(5) This Act shall not apply to a dwelling-house erected after or in course of erection on the second day of April, nineteen hundred and nineteen, or to any dwelling-house which has been since that date or was at that date being bona fide reconstructed by way of conversion into two or more separate and self-contained flats or tenements.

CATHAOIRLEACH

The effect of that apparently would be that flats do not come into the purview of either of these Acts if they have been constructed since 1919.

Mr. O'HIGGINS

Quite right, and it may be said in explanation of that that the underlying idea of that provision was to encourage the construction of flats and the conversion of old large houses into flats.

Mr. FORAN

I would suggest to the Minister that he should look into this matter because, undoubtedly, it is a tremendous grievance at present and it is growing owing to the housing shortage in Dublin. Great numbers of people are compelled to occupy flats and it has become a great source of income to people who own fairly large houses to have them altered partly and to be able to let these flats at enormous rents. So far as I know the tenants of these flats have no remedy and have nowhere to apply to have fair rents fixed. Consequently owing to the competition for these flats the landlord is in a position to command a rent altogether out of proportion to the value of the premises and undoubtedly a great number of people in the city are suffering under this injustice. In this Bill there ought to be some protection given to this class of tenant. So far as I know there is no protection whatever in this Bill or in any of the Acts. It is quite a new development that grew up out of the housing problem and it is growing every day. I appeal to the Minister to look into this matter and to devise some means of protecting these people.

Mr. O'HIGGINS

If I find that I have made an incorrect statement I will certainly take steps between this and the Report Stage to put it right. I have stated that the Bill applies to flats with only the exception which I have mentioned in sub-section (5) of the Principal Act of 1923. There is nothing loose or vague about that. Mere minor alterations of a house to enable portion of it to be let separately would not suffice. The thing is quite clear. I have myself heard of cases where the house-owner came a cropper by reason of the fact that he was not held to have complied with the conditions of this sub-section (5). It could not be described as a "dwelling-house erected after or in course of erection on the second day of April, 1919, or to any dwelling-house which had been since that date or was at that date being bona fide reconstructed by way of conversion into two or more separate or self-contained flats or tenements." These words "separate and self-contained flats or tenements" are being very rigidly interpreted and acted upon by the courts and the mere minor alteration or partitions in a house would not meet that. There must be a separate entrance and for all practical purposes two distinct houses.

Mr. FORAN

I will give an instance of what I mean. Take Harcourt Street. The owner of a house there formerly occupied rooms in it. He sets some of the rooms in the house in tenements, but still retains portion of the house. Is there any legal remedy for the tenants in that case, or is there any court to apply to have a fair rent fixed for these apartments?

CATHAOIRLEACH

Perhaps you would let me point out this, Senator. No flats are outside this Act unless erected for the first time since 1919. If a house has been turned into flats before that date it is caught by the Act. But if built or turned into flats since that date, then it is outside the Act.

Mr. FORAN

That is the position and this evil is growing. It is more profitable now to have flats than to build houses.

Mr. BENNETT

Senator Keane complained of the great profiteering that went on on the part of tenants in regard to sub-tenants. Is there any provision at all whereby if a tenant sub-lets he must do so at a reasonable rent? As far as I can understand from the extracts from the Bill and the Act read by the Minister, it is only in the case of lettings before 1919 that these provisions apply. Am I wrong?

Mr. O'HIGGINS

Yes, you are wrong.

Mr. BENNETT

Then how is the rent to be determined or fixed?

Mr. O'HIGGINS

By a court.

Mr. BENNETT

Supposing there was no letting previously and that a house is turned into tenements, say, last year, and no letting before 1919, is there any court to determine what is the just rent?

Mr. O'HIGGINS

I can only assume that the court will arrive at the apportionment of the standard rent to the entire building. Sub-section (2) of Section 1 clearly places the onus on the court of determining the standard rent of the dwelling-house and equally clearly I suggest sub-section (1) of Section 3 lays it down that:—

"This Act shall .... apply to a house or part of a house let as a separate dwelling where either the annual amount of the standard rent or the rateable value does not exceed (a) in the county borough of Dublin and the Urban districts in the Dublin Metropolitan area sixty pounds and (b) elsewhere forty pounds, and every such house or part of a house shall be deemed to be a dwelling-house to which this Act applies."

And further down in the section in sub-sections (2) and (3) you have:

"Any rooms in a dwelling-house subject to a separate letting wholly or partly as a dwelling shall, for the purposes of this Act, be treated as a part of a dwelling-house let as a separate dwelling."

I am not in doubt now that sub-letting and sub-tenancies are covered by the 1923 Act and by this Bill and that there is a remedy for sub-tenants if there is exploitation on the part of tenants.

Colonel MOORE

Does this apply to the case of a large house with a high rent in which rooms are let to people? It does not seem these people deserve any consideration whatever. Sympathy is due to unfortunate people who are crammed into places, but for rich people who take houses or part of houses a provision of this kind seems unreasonable.

Mr. O'HIGGINS

There we come to the position of what are called "digs" in Dublin. A student takes a furnished room with board. It is not possible to go into that relationship unless there is part of the house set aside as a separate dwelling. You cannot hope to govern, by legislation, the amount of rent that the landlord would charge a student.

Mr. FANNING

In the case of a house part of which is taken by a solicitor or a dentist, what is the position? There are quite a number of cases of that sort.

CATHAOIRLEACH

If the house is let for the purpose of occupying it as a dwelling-house the Act will cover it. If it is merely set as an office, it is not touched by the Act at all. It requires to be let as a dwelling-house.

Mr. DOWDALL

There is no shortage of offices, but there is a shortage of dwelling-houses.

Mr. O'HIGGINS

It is difficult to give a statement off-hand. It will be a question of fact in each case. If there is residence there it is governed by the Act. If, on the other hand, it is business premises or offices used for trade or professional purposes, there is no control or intervention under the Statute.

Colonel MOORE

The Minister seemed to imply that "digs" would not come under the Act, but it seems to me they would. I should like to know whether they would or not. I do not think they ought to come under the Act.

Mr. O'HIGGINS

That furnished room with board and lodging lettings is certainly not controlled at all. Section 3, sub-section (1), paragraph 1, of the Principal Act, says:—

"This Act shall not apply to a dwelling-house bona fide let at a rent which includes payments in respect of board, attendance, or use of furniture, unless on an apportionment of such rent under this section the portion of such rent attributable to the dwelling-house alone equals or exceeds three-quarters of the rent, in which case this Act shall apply to the dwelling-house, or at the option of the landlord shall apply as if the dwelling-house had been let at the said portion of the rent so attributable to the dwelling-house alone."

CATHAOIRLEACH

This question about sub-tenants is very serious, and certainly I should be very slow and reluctant to say how far the Principal Act applies in these cases. I do not think it is reasonable to press the Minister for a statement on the question now, and I think it is well worth holding it over for Report.

Mr. O'HIGGINS

I should be prepared to discuss the question of sub-letting more fully on Report, but it is right that Senators should know even at this stage that I have been advised that sub-lettings and sub-tenancies are governed by the 1923 Act, and by this Bill, and that there is a statutory remedy for sub-tenants who have been fleeced.

Mr. GUINNESS

I should like an explanation of the expression the Minister used. He said sub-tenants were fleeced. Take the example Senator Foran gave of a large house in Harcourt Street being divided for the purposes of occupation into small or large flats. Under the Bill, is it possible for those who are anxious to occupy those flats to come into Court and ask that the rent they should pay to the owner or landlord should be fixed? I do not take exception to the word "fleecing." It does occur, I know, but I think there are many cases to which that should not apply. What I am anxious to know is, is it open to the prospective occupier of a flat to go into court and ask that the rent should be fixed?

Mr. O'HIGGINS

Not if the flats were constructed after the second day of April, 1919. The whole idea of this legislation is to control those houses and parts of houses which were built prior to the scarcity. There is no control if a house is built next week. The owner can then charge any price as rent for that house, if he can find anyone foolish enough to pay him that price.

Mr. GUINNESS

The houses in Harcourt Street have been built one hundred years ago and must have been recently reconstructed.

Mr. O'HIGGINS

If a house is built anywhere next week the owner of that house can charge anything he can find anyone foolish enough to pay; similarly with regard to flats. If a house is converted into flats this year or was converted last year or any time after April, 1919, any figure can be charged for it that people will pay, but prior to April, 1919, if the flat were constructed it comes under this legislation as a dwelling-house and wherever the word "dwelling-house" occurs the Senator can read the word "flat."

CATHAOIRLEACH

I understand this is to be considered on Report.

Amendment, by leave, withdrawn.

Section 15 agreed to.

Title agreed to.

Mr. O'HIGGINS

With regard to the Report Stage, I want to say this Bill ought to be law before the 24th of next month. It is not the kind of Bill about which I should like to bring forward an urgency resolution, eliminating the seven days' delay in securing the Governor-General's signature, so I think the Report Stage should not be taken later than Tuesday of next week because, allowing for the seven days running, it should be law before the 24th.

CATHAOIRLEACH

There may be a reason why I should ask the House to sit for a short time on Friday. If so, I can ask them to take the Report Stage on that day. If not Friday, we can guarantee it for the following Wednesday. If we meet on Friday, I shall put it on the Agenda for Friday.

Bill to be reported.

Seanad went out of Committee.

Bill reported.