A considerable number of amendments have been made to this Bill since it was last before this House. Some of those amendments arose out of discussion of the Bill in the Dáil, others out of the discussions in this House that preceded the Dáil debates on the Bill, still others out of difficulties that came to notice since the Bill was last before this House or out of observations that were furnished by the Landlord and Tenant Commission on the proposals in the Bill. In whatever way the amendments arose I hope that Senators will, on consideration of them, agree that they improve the Bill significantly although, of course, some of the amendments bear on the 1978 ground rents legislation rather than on the areas principally covered by this Bill. For the benefit of Senators, I now propose to outline the general purport and scope of the amendments, and if any Senator should require elaboration in regard to any particular amendment or amendments I will do my best to meet any such requirement when I come to make my closing address to the House. In relation to every amendment that I do not specifically mention the House may be assured that a drafting amendment only is in question.
The necessity for amendment No. 1, which widens the scope of the Title of the Bill, arises out of amendments Nos. 38 and 39 and will become clear when I come to deal with those amendments. Amendments Nos. 2, 3 and 5 are designed to resolve a difficulty that arose concerning the effect of the provisions in section 5 (1) (a) (iv) of the Bill. The amendments are designed to ensure that oral lettings for temporary convenience may come within the scope of the provision as well as lettings of that kind that are made in writing and also to ensure that a successor in title is not prevented from relying, in any appropriate case, on the temporary convenience.
Amendment No. 4 arose out of an undertaking that was given by my predecessor in this House. Senators may recall that an Opposition amendment to delete section 4 of the Bill, as introduced, was withdrawn on foot of an undertaking to re-examine the matter. The amendment that was accepted by the Dáil arose out of that re-examination. The amendment is designed to meet a valid objection that was raised in the Seanad to the total exemption of the State—as lessor—from the code of landlord and tenant law.
The objection relates to the case where an occupational tenant finds that he has become a tenant of the State, possibly without either his knowledge or consent, having previously been a tenant of a private landlord. In such a situation the tenant would, apart from the amendment that is proposed, find that whereas he could have had rights against his landlord under the landlord and tenant code, those rights have disappeared where a State authority has taken over as landlord. The amendment proposes that the tenant's existing rights should be preserved in that situation, that is, his right to a renewed occupational tenancy where that right has accrued, and his right to compensation for any improvements he may have carried out. The right to a new tenancy applies on one occasion only in the circumstances catered for in the amendment. Following on the grant of that new tenancy the tenant will thenceforth be in the same position as any other tenant of the State and he will not have a statutory right to a further renewal of his tenancy.
The statutory rights that are being given are restricted to persons who are occupational tenants and are not being extended to ground rent tenants; those, for example, with which Part III of the Bill is concerned. The rights of ground rent tenants whose landlord is a State authority are catered for separately-in section 70 of the Bill.
The purpose of amendment No. 6 is to restrict the scope of subsection (2) of section 5 so that the subsection will apply only where property rented for State purposes is occupied by some branch of the public service. This amendment meets a point that was raised by Senator FitzGerald on Committee Stage debate.
Amendment No. 7 updates the original provisions of subsections (3) and (4) of section 5 to cater for modern arrangements involving a property-holding company and a trading company. Amendment No. 8 is a drafting amendment and makes it clear that the exemption of housing authorities from the obligations of the legislation is being preserved except only where business lettings are concerned.
Amendments Nos. 9 and 10 are of some significance. Amendment No. 9 makes it clear that, provided there has been business use during a three-year period, the right to a new tenancy applies in two kinds of cases under the provisions of section 13 (i) (a):
(a) where an individual person (or firm) has been the occupying tenant for three years, whether under one continuous tenancy or under a series of consecutive tenancies, and
(b) where the occupation has been by a tenant together with his predecessors in title, under a single continous tenancy.
The amendment also rehabilitates a requirement in the corresponding provision of the 1931 Act, that the business use must be bona fide. The Minister for Justice, on careful consideration of the views expressed by Senators FitzGerald and Molony, came to share their views in this regard. Amendment No. 10 is possible only because of the redrafting of sections 13 (1) (a) that was involved in amendment No. 9. Because section 13 (1) (a) now imposes separate requirements on a tenant as to occupation and as to business use for the purposes of acquiring rights under the Bill, a prearranged break in occupation, or tenancy, for the purpose of ensuring that a particular letting remains outside the Bill will still be possible. At the same time, any break in business use, provided occupation is continuous, may be disregarded by the court if it considers it reasonable to disregard it.
Amendments Nos. 13, 14, 27 and 28 are designed to make it clear that the requirement as to planning permission in connection with a landlord's rebuilding or redevelopment plans, where that landlord is opposing the grant of either a renewed occupational tenancy or a reversionary lease, is satisfied only by possession of a current, valid planning permission and not by a planning permission that has lapsed.
Amendments Nos. 15, 17 and 19 arose from an argument put forward in Dáil Eireann, and accepted by the Minister for Justice, that narrow time limits in section 20 could, in practice, delay rather than expedite proceedings in relation to a claim for a new tenancy and moreover could give rise to hardship, since a tenant who failed to serve notice in time would usually be constrained to seek an extension of time under section 83, whatever the expense involved. The effect of these three amendments is that a tenant's right to serve a valid notice claiming a new tenancy will be preserved for a period of three months, instead of only one month, after service by the landlord of notice of the termination of the tenancy.
Amendments Nos. 21 and 30 are of some importance. They make changes in the "gross rent" formulae in relation to renewed occupational tenancies and reversionary leases respectively. These changes arise out of the findings of the Landlord and Tenant Commission who had been asked by the Minister for Justice to re-examine the "gross rent" formula in the light of the comments made by the Supreme Court in the course of delivering judgment in the case of Byrne v. Loftus concerning that formula as it stands in section 29 (f) of the Landlord and Tenant Act, 1931. That re-examination was still in progress when the Bill was last before this House. The effect of the changes made by the amendments is that "gross rent" will mean, in effect, the open market rent of the property, less the value of the tenant's goodwill.
Amendments Nos. 22 to 26 concern section 24 which provides for reviews of the rent in cases where the terms of the new tenancy are fixed by the court. The amendments are of a technical or drafting nature, their purpose being to tighten up the provisions of section 24 in order to ensure that those provisions cannot be operated unfairly, by either landlord or tenant, by reference to the timing of applications for new tenancies and/or rent reviews, and also to clarify the date from which a reviewed rent becomes payable.
Amendment No. 31 is designed to ensure that—in view of the consideration that a landlord has only one month in which to respond to a tenant's improvement notice—full information concerning the proposed improvement is made available to that landlord. The amendment therefore requires that the improvement notice should in every case be accompanied by that information.
Section 64 was inserted in the Bill in the course of the Committee Stage debate in this House. The amendment thereto, No. 33, that was made by the Dáil has the effect of extending the definition of "lease" so as to cover a statutory tenancy on less than a yearly basis that may arise on the expiration of a lease. Accordingly, the benefit of Part V of the Bill is now extended to statutory tenants who hold over on the expiration of a lease, whether or not that lease was on a yearly basis.
I now come to a number of new section that have been inserted in the Bill since it was last before this House. Amendments Nos. 35, 36 and 37 affect the provisions of the Landlord and Tenant (Ground Rents) (No. 2) Act, 1978. These amendments add to the classes of persons who are given the right to acquire the fee simple.
Part II of the 1978 No. 2 Act sets out in an intentionally simplified form the classes of ground rent lessees and yearly tenants who are given the right to acquire the fee simple. Such simplification inevitably carries the risk of excluding unusual cases, cases such as have since come to light and are now catered for by these amendments. These three amendments ensure that the right to acquire the fee simple is now given to every class of lessee and tenant that has, to date, been identified as having a ground rent-type relationship with the landlord.
Amendment No. 35 extends the right to acquire the fee simple, under Part II of the 1978 No. 2 Act, to a new class of ground rent lessees, that is those lessees to whom Part II of that Act would apply save that they fail to satisfy condition 5 in section 10 of the Act because in their cases the previous lease mentioned in that condition did not expire or was not surrendered before 31 March 1931. As amended by what is now section 71 of the Bill, condition 5 of section 10 of the 1978 No. 2 Act may apply regardless of the date of expiration or surrender of that previous lease. This change was recommended by the Landlord and Tenant Commission.
Amendment No. 36 extends the same right to acquire the fee simple to a further new class of ground rent lessees. These lessees are those whose leases would satisfy the conditions in section 9 of the 1978 No. 2 Act and, in particular, condition 7 in section 10 of the Act, save that those leases are for terms of less than 50 years. Amendment No. 36, however, requires certain other conditions to be satisfied and the effect of the changes made by the amendment is to ensure recognition as a ground rent lease for every lease made for a term of less than 50 years that would be a "proprietary lease" as defined by section 7 of the Landlord and Tenant (Reversionary Leases) Act, 1958. This change also was recommended by the Landlord and Tenant Commission.
Amendment No. 37 extends the same right to acquire the fee simple to any person to whom section 3 of the 1967 Ground Rents Act applied immediately before the commencement of the 1978 No. 2 Act, or would have applied had he served a notice under section 4 of the 1967 Act. Section 3 of the 1967 Ground Rents Act, apart from subsection (5) of the section, is repealed by the 1978 No. 2 Act. Amendment No. 37 restores the right to acquire the fee simple that was given by the 1967 Ground Rents Act in certain unusual types of cases that are not covered by the simplified categories of ground rent leases set out in Part II of the 1978 No. 2 Act.
Amendment No. 38 is one of the amendments—No. 39 being the other —that necessitated the widening of the scope of the Title of the Bill. The purpose of the amendment is to regularise the position concerning certain interests in land that originated prior to the passing of the Renewable Leasehold Conversion Act, 1849.
A common method of leasing property in Ireland up to the mid-19th century was by the creation of a lease for the terms of the duration of the lives of, usually, three named persons, subject to a rent and covenants, including a covenant by the lessor for the perpetual renewal of the lease for further lives. The Renewable Leasehold Conversion Act, 1849, declared that any future such leases should operate as fee farm grants of the fee simple. It also gave to persons then holding under such a lease the right to obtain a fee farm grant, normally at the same rent, in lieu of the lease.
While many such leases were converted in accordance with the Act, it appears that a number were not so converted. The lessees under such leases have continued in possession and their interests may have become that of yearly tenants with a legal right to obtain a renewal or conversion grant. A yearly tenancy, even if coupled with a right to obtain a fee farm grant, is not registrable in any of the registers of the Land Registry and although the persons in question have complete security of possession, their titles may not be readily marketable as they might not be acceptable to lending institutions, or to purchasers who might be depending on such institutions to finance the purchase, because of the prospect of the costs that would be involved in conversion or renewal proceedings.
The amendment puts the parties to the lease on the same footing as if the lease had been converted under the Act of 1949. It concerns only a lessee who has continued in possession without either conversion to a fee simple or renewal of his lease; such a person has an "interest" in the land and not an "estate". The new fee simple is deemed to be a graft on the previous interest and is subject to any rights or equities arising from its being such a graft. This means that the fee simple is subject to the rents and covenants in the previous lease in the same manner as if a conversion had been effected under the Act of 1849.
Amendment No. 39 is a new provision in landlord and tenant law and is intended to bring the rights of tenants of certain houses provided by public utility societies more into line with the rights enjoyed by occupational tenants generally. Grants were paid under the Housing (Financial and Miscellaneous Provisions) Acts, 1932 and 1962, to a small number of public utility societies in respect of the erection of houses for letting. The grants, generally known as "public utility society letting grants", were paid subject to a statutory condition that an undertaking be given by the recipient society that the houses would not be sold but would be let on a monthly or lesser tenancy to persons of the working classes or agricultural labourers. The tenants of the houses in question are, therefore, precluded from purchasing the landlord's rights in their houses even where the landlord is willing to sell. The general purpose of the amendment is to remove this disability by enabling the houses to be sold within the consent of the Minister for the Environment.
In conclusion, I should like to express on behalf of the Minister his appreciation of the diligent consideration that this Bill has received in the Seanad and in the other House. The Bill is, I feel sure, much the better for the time and energy that was devoted to it by both Houses and by the various professional bodies and individuals who took the trouble to examine its provisions and furnish their observations thereon to the Minister. In particular, the members of the Landlord and Tenant Commission are deserving of gratitude for their assistance with this complex legislation.
