Dáil debates

Thursday, 10 May 2012

Topical Issue Debate

Mortgage Resolution Process

4:00 pm

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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On the Order of Business on 1 May, I asked the Taoiseach to outline what action the Government was taking to ensure that all financial institutions which provide mortgages for Priory Hall residents would be fully engaged in the proposed new Priory Hall resolution process under former Supreme Court judge, Mr. Justice Joseph Finnegan. The proposal for a new resolution process had been announced a few days earlier and was greatly welcomed by Priory Hall residents as the first potentially positive step in six months of appalling suffering for them and their families. Given the horrendous ordeal they have endured, Priory Hall residents unanimously agreed to enter the resolution process. When the resolution process was initially announced, it appeared that the banks and financial institutions were refusing to engage with residents, Dublin City Council and other stakeholders. Given that many of these banks have been bailed out to the tune of billions by Irish citizens, it was particularly galling to read comments, allegedly from the Irish Banking Federation, that these financial institutions would not participate in the process and would continue to engage with Priory Hall residents only on a case-by-case basis.

A number of days later, AIB agreed to take part in the resolution process. I understand that a significant number of Priory Hall owner-occupiers are AIB mortgage holders, so this was a welcome decision for the individuals and families concerned. I also understand that a significant number of residents have mortgages with Bank of Ireland. Residents were clearly extremely anxious that all banks and financial institutions would fully engage with the mediation process to ensure it had credibility and would be able to help resolve the unique mortgage problem for Priory Hall owner-occupiers. Some residents greatly fear that they may be forced into bankruptcy if the mortgage crisis for Priory Hall residents is not urgently resolved. They also fear that they may face mortgage, rent and storage costs even though this whole construction, legal and financial quagmire came about through no fault of theirs.

A few weeks ago it seemed outrageous that banks, including several owned by the Irish and British states, might refuse to get involved in a voluntarily resolution process and I called on the Taoiseach to undertake all possible action to ensure they got involved. The Taoiseach told me in Dáil Éireann that he had spoken to the Minister for the Environment, Community and Local Government and that he had received confirmation from the banks that they would engage in the resolution process of Mr. Justice Finnegan. He went on to say that when he was in Baldoyle at the announcement of the $500 million investment by MyIan, he met a number of the people from Priory Hall. He concluded by saying: "My views on this matter are clear. I am pleased to note the banks have confirmed they will engage in the resolution process." I asked the Taoiseach to confirm that all of the banks and financial institutions would participate and he answered in the affirmative and said: "I understand 13 or 14 banks are involved."

I welcomed the Taoiseach's comments on the Order of Business last week that all the banks will now engage in the proposed resolution process under Mr. Justice Joseph Finnegan. However, residents had not been informed of this and were very anxious to get confirmation of the name of each bank or financial institution that has agreed to participate. Can the Minister of State confirm which banks have agreed to participate? Has the Department provided Priory Hall residents and their outstanding representatives, including Ms Sinead Power, Ms Ursula Graham, Mr. Graham Usher and Mr. Darren Kelly with a list of the 13 or 14 institutions concerned? What other stakeholders will be involved in the process? Will these include the developer, Thomas McFeely and Coalport? Will the Minister of State indicate precisely how many Priory Hall residents have been invited to partake in the mediation process?

I received correspondence from the Minister for the Environment, Community and Local Government, Deputy Hogan, this morning and he said: "Out of respect for the process approved by the Supreme Court, I do not intend to make any comment at this point other than to ask all stakeholders to engage fully with it." I back the Minister's call for all stakeholders to be fully engaged in the process. However, residents are also clearly very anxious to get further details on the current status of the resolution process. Can the Minister of State confirm how long the process will take? I note that the Minister's correspondence referred to the "adjournment of the legal proceedings for a period of three months". Is there a three-month deadline and does the reference to three months mean we will have a conclusion in July? I would appreciate the Minister of State's comments on this.

Photo of Fergus O'DowdFergus O'Dowd (Louth, Fine Gael)
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I thank Deputy Broughan. I am taking this matter on behalf of the Minister for the Environment, Community and Local Government, Deputy Hogan. I acknowledge the ongoing, stressful, and distressing situation being experienced by these residents. They have been placed in a very difficult position and the Minister and all concerned wish to see their difficulties resolved as quickly as possible.

A Supreme Court hearing on an appeal by Dublin City Council against an order to pay for accommodation, storage costs and ancillary costs of residents forced to vacate their apartments at Priory Hall had been scheduled to take place on Tuesday, 24 April 2012. However, on Friday, 20 April 2012, the Supreme Court agreed to adjourn those proceedings for three months to allow for a conciliation process between the parties on the understanding that a court date will be made available in July should a hearing be necessary. The conciliation process is being chaired by Mr. Justice Joseph Finnegan, a retired Judge of the Supreme Court and a former President of the High Court. It provides an appropriate context for all parties concerned to work together towards identifying a way forward in dealing with this complex problem.

The Minister, Deputy Hogan, is not a party to the legal proceedings and has no role or involvement in regard to the conciliation process. Out of respect for the process approved by the Supreme Court, and for Mr. Justice Finnegan, the Minister does not intend to make any comment on the matter at this point, other than to urge all stakeholders to engage fully with it. At this point, nobody can anticipate the outcome of the process and it is important that all concerned now afford Mr. Justice Finnegan the opportunity to complete the task he has been given.

The residents of Priory Hall have now been out of their homes for more than six months. The overriding priority continues to be to facilitate the return by the residents to their homes as early as possible. In this respect it will be necessary to ensure that these homes are made fit for purpose and that the costs of so doing fall where they should. The Minister has asked Dublin City Council to do all within its powers to achieve this objective and has asked his Department to continue to liaise closely with Dublin City Council in this regard

Dublin City Council has made commendable efforts to provide for the needs of residents to date and it continues to work proactively on behalf of the residents towards achieving the necessary and longed-for resolution of the issues. In particular, the council, with the assistance of the Department and in consultation with NAMA, has secured alternative temporary accommodation for many of the residents. The council, with some assistance from this Department, continues to bear the cost of such accommodation and has confirmed it will continue to do so while the conciliation process is underway.

In these circumstances, and on behalf of the Minister, I urge all concerned to allow Mr. Justice Finnegan the opportunity to complete the task he has been given.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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I appreciate this reply. Is it the view of the Minister of State that all the financial stakeholders in the 187 units, referred to by the Taoiseach, should be present and should participate in order to ensure that this unique and very difficult issue will be resolved? Does he believe the stakeholders who should be present should include the original developer?

The Minister of State referred to the homes being made fit for purpose for the people concerned, those now out of their homes. Has the Department taken any view in terms of having a cost-benefit analysis or an interaction with Dublin City Council to explore whether a re-build of the entire complex might be the best way forward and part of the resolution? Would the Minister of State envisage Dublin City Council having the key role in that?

As the Minister of State will be aware, at this time, and pursuant to a proposal by me, Dublin City Council is preparing a new local area plan for the whole north fringe district. This was to be a new area of Dublin, with a population perhaps the size of that of Waterford or Tralee. That plan is entering its final stages and is returning to the city council. The Priory Hall complex occupies a key location on the main boulevard, or street. Is it important that the Department of the Environment, Community and Local Government and Dublin City Council should interact and make the resolution of the Priory Hall issue part of the final local area plan for the district?

Photo of Fergus O'DowdFergus O'Dowd (Louth, Fine Gael)
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Again, I thank Deputy Broughan for his comments and I assure him I will bring them to the attention of the Minister, Deputy Hogan, and also to the Department. He has raised important points that are not part of the briefing I was given but nevertheless they represent the deep concerns of the Deputy and other public representatives, and of the community of Priory Hall in general who have been put at a very serious disadvantage as a result of all these issues.

It is important, however, that the independence of conciliation process chaired by Mr. Justice Finnegan is respected. We all accept that. The Minister recently released, for public consultation, proposed new building control regulations which will provide, first, for the introduction of mandatory certificates of compliance by builders and designers of buildings confirming that the statutory requirements of the building regulations have been met and, second, for the lodgment of drawings, at both commencement and completion of construction, demonstrating how the building has been designed and built to comply with all parts of the regulations.

The closing date for submissions is 24 May 2012. Mandatory certification and lodgment of drawings are key reforms which will have the capacity to improve the quality of buildings and lead to the further strengthening of the regulatory regime in 2012. These reforms are necessary if we are to ensure that a situation like that in Priory Hall can be avoided in future.

I reiterate that all the Deputy's views will be brought to the attention of the Minister, Deputy Hogan, and to the Department. If there is any further information that can be shared with him that will be done.