Promised repossession law not drafted yet, court told

Legislation promised by Government by the end of this month to repair the law on repossessions has not yet been drafted, the High Court was told yesterday.

Michéal O'Connell, for the Attorney General, told Ms Justice Mary Laffoy there was an intention to bring forward legislation on the matter but it had not been drafted or "come near the Oireachtas", and he could not say how ongoing litigation might be affected by it.

Michael McDowell SC, representing Bank of Ireland, had sought a date from the Attorney General for when the legislation would be published.

The bank had taken a case involving properties secured on a debt of €2.9 million owed by former Ireland and Munster rugby player Frankie Sheahan and his brother Joey.

It had intended challenging a ruling made by Ms Justice Elizabeth Dunne in 2011 which had affected the repossession rights of lenders, including Bank of Ireland.

Ms Justice Dunne had found certain registered properties could not be repossessed because of a loophole in the Land and Conveyancing Law Reform Act 2009, which was introduced on December 1st, 2009. As a result, repossessions of property, including private homes and buy-to-lets, have almost ground to a halt in the courts .

This week the Government said new legislation would be introduced to resolve the difficulties by the end of this month.

The Department of Justice said yesterday that legislation would also provide that a court, when considering a repossession action, may adjourn proceedings for up to 60 days to allow the parties to explore whether a personal insolvency arrangement for the borrower would assist in reaching “an equitable alternative settlement”.

Yesterday Mr O’Connell said he could not say when the legislation would be published.

“I cannot speak on behalf of the Oireachtas.”

Ross Maguire SC, for the Sheahans, said his clients had found themselves “caught up” in the challenge when they were only interested in a resolution for themselves. The bank was using their situation to “determine more global issues”.

If the bank was to go ahead with the challenge of Ms Justice Dunne’s judgment the case could take three days and the issues to be canvassed would be “very wide ranging”, he said.

These would include testing the rule of stare decisis , where a judge is obliged to follow a decision made previously by a judge of equal rank, and the double-construction rule, where if a law can be construed as either constitutional or unconstitutional, it should be construed as constitutional.

He asked that the case be adjourned on the basis the Government had promised legislation to repair the loophole.

Dilemma
]Mr McDowell said his client was in a dilemma because the Attorney General could not indicate to the court a date when the legislation was to be published. If they adjourned the case they did not want to "go into limbo".

However, having taken instruction, he said the bank was prepared to adjourn. If reports that legislation might be published by the end of the month were true, they did not want to waste public time or their own resources.

Ms Justice Laffoy adjourned the case to April 11th, giving leave for the bank to apply for another hearing date should the legislation not be published.