Jim Walsh (Fianna Fail)

I welcome the Multi-Unit Developments Bill, which introduces regulation in an area in which it is much needed. There have been examples in the recent past of fairly acute problems in this regard, although many of the problems associated with apartment living have arisen from poor design, bad planning and, in particular, a failure to ensure units of adequate size with appropriate open areas and so on. While this issue remains to be attended to, it probably is outside the scope of both this Bill and the Department promoting it.

Nevertheless, the provisions of the Bill are to be welcomed. It places responsibilities on the owners of apartments in that they will be obliged to pay service charges, make a contribution to a sinking fund and to observe certain house rules. This is fundamental to enhancing the quality of life of those with whom they share such residential developments. It also sets out clearly the responsibilities of developers to establish owners' management companies in advance of selling any units, which is a worthwhile provision. It also places an obligation to transfer common areas at that point or, if they are in the course of construction, within six months of their completion.

I wish to pose a few questions to the Minister of State. First, there is an obligation under section 5 for the developer to complete the development. However, in the current economic downturn many developers will not be in a position to so do because they have become insolvent. Has any thought been given to the establishment of a bond? That was a method of dealing with such issues in the past when a contractual arrangement existed between a principal and a developer. I am uncertain whether this is the case in this regard.

I also wish to raise the issue of voting rights within the management companies. I note there is provision that each unit owner will have one vote, regardless of the size of the cost of the unit. While I may be wrong, I understand this to be at variance with the recommendations of the Law Reform Commission. Perhaps the reason this provision applies should be spelt out. Why is there not a weighted provision in such a company's shareholding that is proportionate to the amount people actually have paid?

I certainly welcome the provisions in section 14, which spell out clearly the areas for which the service charge is applied. This must be transparent and it is important for each owner to be aware of the costs under each of those headings. I fully accept a sinking fund is highly desirable in respect of a building that will require ongoing maintenance. However, I query it in respect of residential units, houses and so on, where one may not incur similar costs. On reading the definitions, I am unclear whether the Bill covers this area.

I welcome the change in respect of strike-off provisions whereby one can apply to have a company that has been struck off by the Companies Registration Office restored within six years. In general however, and this also applies to other companies, this area of striking off companies is highly questionable. The Minister of State should comment on the possibility that in the event of a serious accident resulting in the incurring of a huge public liability settlement, it might have the effect of exposing unit owners, who may be unaware of the strike-off provision, to costs for which they might not be in a position to provide.