Dermot Ahern (Louth, Fianna Fail)

If this Bill is to pass muster and go before the courts, it would have to give that type of guidance. Such objectivity is a crucial element if the impact of Government intervention is to be proportionate and non-discriminatory.

If, as law and equity would seem to require, there is a proper assessment as to the need for Government intervention, the timeframe required for such an assessment would be such as to defeat the emergency imperative which allegedly is the underlying rationale for the Bill.

As I understand, the effect of the Government order which is mandated by the Bill would be to allow the current provisions of section 132 of the Land and Conveyancing Law Reform Act 2009, to apply to all leases, and all agreements for leases, regardless of when they have been entered into. The Bill does not make it clear as to whether this provision is intended to apply to existing leases where reviews have already taken place, which could be this year, last year or some years previously. If it is intended to so apply, this is a recipe for market chaos as rents previously agreed would have to be recalculated to accord with the Bill's provisions. If it only applies to existing leases in the context of future reviews, the difficulties which have inspired the Bill, such as high rents resulting from determinations on the basis of upward-only rent reviews, are not being addressed and the Bill may be regarded as disingenuous. I believe it is.

The current section 132 is framed in very neutral terms and does not preclude an upward review where this would be justified. If one examines closely the new subsection (2)(b) of the Deputy's Bill, it seems clear that it only contemplates a downward adjustment. As Deputies will be aware, market rent is traditionally the rent which, on the basis of vacant possession, a willing tenant would pay and a willing landlord would accept. Even in our current difficult circumstances, it is not inconceivable that market rent in some cases might be more than the sitting tenant is willing or able to pay. The Bill, in failing to address this issue, does not do justice to the complexity of the commercial property market. Neither does the Bill deal at all with the situation where the parties fail to agree on the appropriate level of rent. One of the undoubted difficulties in this area is that the parties are seldom ad idem as to the rent which is to be paid. Presumably the standard provision in a rent review clause, whereby, in the event of a dispute, the matter goes to arbitration or review, is not being interfered with. However, there is a reference in the Bill to the fact that the Government order may provide for any measures necessary to secure compliance with it. I ask the Deputy if he is contemplating the establishment of some additional mechanism to verify whether the reviewed rent equates with the Bill's provisions. In that event, is Government to substitute its version of the reviewed rent for that which has emerged on foot of the review? This is plainly nonsensical.

Finally, I would observe that the basis for discriminating as between particular types of commercial premises and particular geographical areas is not clear. The concept of geographical area, in this context, is especially vague. Is this a reference to counties, townlands or specific streets?

The Bill is deeply flawed both in its legal and practical aspects and I do not propose to comment any further on its demerits. This is not a Bill which the Government could endorse with any credibility. I reject any suggestion the Government should accept the Bill, amend it or introduce a similar Bill. The unequivocal legal advice from the Attorney General and confirmed by independent legal advice is that the Legislature cannot retrospectively pass law today to rewrite contracts freely entered into by two individuals.

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