Mr. Seamus Carroll:

When it comes to housing and accommodation, the appointment of receivers is normally limited to to buy-to-let premises, as Mr. McKenna has said.

Receivership is not appropriate in the case of a principal private residence of an individual. The receiver, when appointed, has a duty of care both to the lending institution that has appointed the receiver and to the borrower. The receiver must act in a fair and proportionate manner vis-à-visthe lender and the borrower. Current land and conveyancing law does not specifically refer or cover the role of tenants in any buy-to-let property.

Tensions and potential conflict may arise because the role of the receiver is to manage the property but at a certain stage the receiver may move to sell the property. The obligation on the receiver then, as has been said, is to obtain the best price reasonably obtainable for the property. That is a strict obligation and has been interpreted by the courts in a strict manner.

If the buy-to-let property is in a residential area, for example, likely buyers will want to use it as their residence. Therefore, the best price reasonably obtainable for that property will normally require vacant possession of the property. A potential buyer will not wish to buy property with tenants if he wants accommodation for himself. This is where the conflict arises because the obligations of the receiver are to the lender and the borrower. In a way the tenants are caught in the middle. A code of conduct has been issued by Banking and Payments Federation Ireland. The code is voluntary, obviously. It is entitled A Residential Tenant's Guide to Receivership. It answers some of the questions that would arise with regard to the payment of rent.