Paddy Burke (Fine Gael)

I welcome the Minister of State to the House and I am glad of the opportunity to say a few words about the proposed legislation, which I welcome as being long overdue.

When we consider the number of apartment blocks built throughout the country over the past ten or 12 years, it is right and fitting that legislation such as this should be put in place as quickly as possible. Many people have experienced unbelievable problems with apartment living over recent years. Apartment living will be expensive for people when these management companies are put in place. Those who take charge of such companies will have many rights bestowed upon them, not alone by the legislation but at annual general meetings and so forth.

Senator Corrigan mentioned there should be a quorum at such meetings and I agree with that. I believe proxy voting should be used as well. Many countries have similar types of systems to that being proposed in this legislation and have seen that they have worked to great effect. People probably do not realise what the full effect of the legislation will be because it is likely to mean a fairly hefty annual charge for some apartment owners, regardless of whether they are living in Dublin, Galway or wherever. There will be administrative charges imposed by management companies and legal wrangles where people do not pay their dues. In the event, management companies ultimately will have to take such people to court, as provided for in the legislation. In some cases, no doubt, the management company will get a charge on the property.

In the event of court proceedings, in some cases there will be a charge on the property from the bank. What is the position of the management company which goes to court to seek money it is owed for the upkeep of the apartment block? Will it only get a second charge if there is a prior charge from a bank or building society? I cannot see where this is spelt out in the legislation, as proposed. However, this will cause problems. Ultimately, perhaps, the property can be sold and the various institutions paid off, but this is something people will have to address, as has happened in other countries where people have defaulted on management charges. In such cases the management companies take legal action and put a charge on the property.

None the less, I welcome this legislation. While everyone knew a vast number of apartments were being built throughout the country, it was not appreciated fully how many people would be living in them, as has been spelt out in the debate. I wish the Minister of State luck with the Bill. I know he has detailed those areas to which service charges will apply. The Bill is well thought-out, providing as it does for a sinking fund as well as the many other aspects that we can go into in more detail on Committee Stage.