I move amendment No. 49:
In page 28, before section 63, but in Part 5, to insert the following new section:
"63.—(1) The Authority shall cease to issue land certificates and certificates of charge under the Act of 1964, and accordingly—
(a) the definition of “land certificate” in section 3(1) of that Act, together with sections 28, 32(2), 32(3), 51(3), 51(4), 62(5) and 64(3), are repealed,
(b) section 105 (certificates) of that Act applies only in relation to land certificates and certificates of charge issued before the commencement of subsection (1) and not already cancelled.
(2) Subject to subsection (3), land certificates and certificates of charge issued before the commencement of subsection (1) and not already cancelled cease to have any force or effect on the expiration of the period of 3 years after the commencement of this section.
(3) The following provisions have effect during the period referred to in subsection (2):
(a) the Authority shall cause adequate notice to be published of the coming into operation of subsection (2) and of its implications for persons to whom land certificates or certificates of charge have been issued and for any others who may be affected, including persons holding a lien on registered land or a registered charge through deposit or possession of those certificates;
(b) a holder of such a lien may apply to the Authority for registration of the lien in such manner as the Authority may determine;
(c) the application shall be on notice by the applicant to the registered owner of the land or charge and be accompanied by the certificate concerned;
(d) the lien is deemed for the purposes of section 69 of the 1964 Act to be a burden which may be registered as affecting registered land;
(e) the Authority shall register the lien without charging any fee or duty for doing so.
(4) Notwithstanding subsection (2), where the holder of a lien has suffered loss by reason of not having applied to the Authority during the period referred to in subsection (3) for registration of the lien as a burden affecting the registered land, the holder may apply to the court for compensation for the loss, on notice to the Minister for Finance.
(5) On the application the court may, if satisfied—
(a) that the applicant is the holder of the lien concerned,
(b) that the holder was prevented from applying to the Authority under subsection (3) by reason of being under a disability (within the meaning of section 48 of the Statute of Limitations Act 1957) or of other exceptional circumstances and has thereby incurred financial loss,
(c) that the remedies available for the recovery of the loss have been exhausted, and
(d) that it would be manifestly unjust for the holder to suffer the loss,
declare that the holder is entitled to compensation for the loss and determine the amount of the loss.
(6) Compensation to which a person is entitled pursuant to the declaration of the court is payable by the Minister for Finance out of moneys provided by the Oireachtas.
(7) The Minister for Finance shall have the same right to recover the amount of the compensation from any person who caused or derived advantage from the loss as the holder of the lien would have had if the loss were an injury caused to him or her by that person.
(8) Interest is payable on any amount recoverable by the Minister for Finance in accordance with subsection (7) from the date of payment of the compensation at the rate for the time being standing specified under section 26 of the Debtors (Ireland) Act 1840.
(9) In this section--
"holder", in relation to a lien, includes any person deriving title from the holder of the lien;
"published" means published by way of advertisement both in the national daily newspapers and in broadcasts for reception by the general public, whether the broadcasts are actually received or not.".
This is an important amendment to the Bill. It responds to concerns expressed in earlier debates about the delays in costs associated with the registration of land. Under current legislation, if a registered owner of land wishes to deal with it in any way, any land certificate issued in respect of the land must be presented to the Land Registry before any further transaction can be registered. In a similar way, the legislation requires that the Land Registry issue a certificate of charge on a mortgage of registered land and that this certificate of charge be produced on any further dealings.
In considering further reforms of land law and conveyancing law, it has become clear that the land certificate and certificate of charge system is incompatible with any proper form of electronic conveyancing. I am convinced that such a system cannot continue if we want to have a fully electronic conveyancing system with all the benefits that will bring to practitioners and consumers. My Department has discussed the matter with the Land Registry, the Law Society and the Irish Mortgage Council representing lenders and there is a general consensus that land certificates and certificates of charge should be phased out. There was a usage of land certificates, in particular, as a means of creating equitable mortgages by depositing them. This amendment means that will be wiped out. The physical giving of the document to somebody else as security will no longer act as a form of estoppel on the land. The United Kingdom has already done this.
The main reason current legislation requires the submission of any existing land certificate is that it may have been lodged with a financial institution as security for a loan. That is generally referred to as an equitable mortgage. While such informal mortgages may have become less common, the fact that any outstanding land certificate must be presented before any transaction can be registered in respect of the property gives rise to a significant administrative burden for the Land Registry. Moreover, the loss and misplacement of certificates issued many decades ago causes long delays and adds to the cost of conveyancing.
The new section provides for the phasing out of land certificates over a three-year period. It specifically provides that land certificates and certificates of charge issued before the commencement of subsection (1) which are not already cancelled will cease to have effect or force three years after the commencement of subsection (1). I am providing for the conversion of any outstanding equitable mortgages into legal charges during that period. Subsection (3) contains details of this conversion process. It also requires the new authority to publicise the new provisions and to provide information on their implications for holders of land certificates or certificates of charge.
Despite the provision that adequate notice be given of these changes, it is possible that some people may not become aware of them or their implications and suffer financial loss as a result. That might arise by reason of a person being under a disability. In practice, this is unlikely to arise except possibly in the case of a private transaction between two individuals. For this reason I have provided in subsections (4) to (8), inclusive, for a compensation mechanism. In the event of it being used, the holder of the land certificate or certificate of charge could apply to the court for compensation for the claim of financial loss. Under the very stringent conditions set out in subsection (5), the court could declare that the holder was entitled to compensation and determine the amount.
I acknowledge that the changes contained in this section are far-reaching and, some might say, radical. However, such measures are justified and necessary if we are to move to electronic conveyancing. We can take the sensible point of view that the Land Registry register was always the evidence of ownership. The certificate was issued to people to provide them with some evidence to show to people to whom one wanted to sell the property that one owned the land. We can imagine what the certificate meant in those days. It meant there was a register in Dublin that could be searched, but the person with the certificate could show he or she owned the farm or whatever. This is no longer necessary because electronic access to the register will be simpler. The problem is that if the status given to the certificate is maintained, electronic transactions will become almost meaningless. One will be able to exchange land instantly on-line but if one has lost the land certificate, one might as well be back in the pony and cart age.