Alan Shatter (Dublin South, Fine Gael) | Oireachtas source

I will deal with the second question first. The proposal was that these matters be dealt with in the Circuit Court as they are appropriate to the Circuit Court and not to the District Court. That is the position in the context of post-1 December 2009 mortgages, as contained in that particular legislation. There is already experience and expertise in the Circuit Court in dealing with these issues and the suggestion arose in the course of Committee Stage that there should be a synergy and the same approach to both pre-1 December 2009 mortgages and post-1 December 2009 mortgages. It was my view that this was reasonable. When the Bill was being drafted, an issue was originally suggested to me that to so change the law might give rise to some constitutional issue because there might be some vested right, for example, in the lenders to take their proceedings in the High Court. I did not think that was a particularly strong issue and have had the matter looked at again. Consequently, I have proposed this amendment, which I hope will be welcomed because it was an amendment urged on me on Committee Stage for which I expressed support, provided the Attorney General's office confirmed to me it could be implemented. This is the reason we are heading down that route.

In the context of all my experience as a lawyer over the years, principal private residence would primarily mean the residence in which someone is residing and this would be the consistent legal interpretation thereof. As it does not normally mean a residence that is being rented to someone else, regardless of circumstances, I am very anxious not to mislead the House in that way. There is a difficulty where it is a rental property as opposed to a property that - if I can put it this way - genuinely is an individual's family home. However, in the exceptional circumstances that have arisen, there may be some area of appreciation or discretion where, bearing in mind the unusual individual circumstances of an individual or a couple, the court may extend that definition. The phrase "family home" has not been used. The phrase "principal private residence" has been used with some deliberation in these circumstances. However, Members also must ensure they do not create a situation in which, for example, someone buys a property with the intention of using it as an investment property and lives in it for two or three months before renting it out and asserting these special procedures should apply. I have dealt with this issue in the manner I believe to be the best way it can be dealt with. It is clearly intended largely to apply to individuals who are in mortgage difficulty or living in the home in respect of which they have mortgage difficulties.

The Deputy, like me, is aware of individuals who for a number of reasons have moved out of homes in which there are mortgage difficulties. Families in two-bedroom apartments simply have found they have grown beyond that original residence they might have acquired in 2004 or 2005. Such people may now have two children who are growing up and, consequently, they have moved out and rented the property. They now are either renting another property or those who are in employment may well have purchased property because of the collapse in values. Consequently, one could not have two principal private residences. They may be renting it as a matter of convenience or they may be renting it to avoid incurring losses on their original investment. A myriad of different circumstances arise but this principally is about individuals living in a property, that is, residing in that property and in mortgage difficulty with that property, to ensure as best as possible that everything is done to try to avoid their loss of the roof over their heads. Obviously, this is part of an issue. If one is renting somewhere else and if the property one is renting out, which one originally purchased as a principal private residence, is lost in a repossession case, one still has a roof over one's head, namely, the property one now is renting. However, there may be some circumstances in which the courts might be willing - but that will depend very much on individual circumstances that do not lend themselves to definition in legislation - to give some area of discretion or appreciation. The Deputy and I probably could invent at least half a dozen examples to which this might apply but in the context of drafting the legislation, I am advised this is the appropriate terminology that can be used. It is the best that can be done in this context and, hopefully, it will have the intended impact.

I refer to both the Circuit Court issue and the application of the personal insolvency protections, the adjournment of court proceedings and the facility to give people an opportunity to re-engage or to engage with a financial institution when confronted by repossession. I am conscious these all are issues about which Deputy Donnelly had concerns, that were featured in his own Private Members' Bill and which he and I discussed a considerable time ago in the context of the insolvency legislation. Consequently, I am doing what I can in this area to be of assistance to individuals. The Circuit Court obviously is a better venue because whether one is a creditor or the person in debt who has not paid his or her mortgage, the legal costs are less onerous than would be incurred in the High Court. Consequently, there is an important cost issue in keeping it at Circuit Court level. The District Courts have never traditionally had this particular area of jurisdiction. They do not have the background expertise in dealing with it and for that reason, I proposed this amendment.

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