As I have mentioned on many occasions, the Central Bank Code of Conduct on Mortgage Arrears (the CCMA) is a statutory code issued under Section 117 of the Central Bank Act 1989. It clearly states in the CCMA that its provisions are legally binding on regulated entities, and the Central Bank has the power to administer sanctions on regulated entities for a contravention of the CCMA under Part IIIC of the Central Bank Act 1942.
In the judgment of the Supreme Court in May 2015 in Irish Life and Permanent plc v Dunne, the Court held that a breach of the moratorium provision in the CCMA would be fatal to a lender’s legal entitlement to possession because allowing an application for possession where there was a breach of the moratorium provision of the CCMA would, in effect, be tantamount to a court acting in aid of the actions of a lender which were unlawful. However, with respect to the other provisions of the CCMA, the judge held that there was nothing in section 117 of the Central Bank Act 1989 or the CCMA itself suggesting that the courts are required to assess in detail the compliance or otherwise by a regulated entity.
In relation to matters that can be taken into account during court proceedings, the Department of Justice & Equality's Land and Conveyancing Law Reform (Amendment) Bill 2019 addresses this issue. The Bill’s key objective is to provide further protections for homeowners in mortgage arrears who are facing the risk of repossession proceedings in respect of their homes. It extends the scope of the Land and Conveyancing Act 2013 to cases where an insolvency solution to a borrower’s mortgage arrears is not, for whatever reason, available.
The Bill is scheduled for Committee Stage this week.
The measures provided for in the Bill will prove to be an important addition to the suite of Government measures to protect those in mortgage arrears who are facing the prospect of court proceedings for repossessions of their homes. It is also important to acknowledge that the Bill received widespread support last month, when Second Stage was taken.