Seanad debates

Friday, 12 July 2013

Land and Conveyancing Law Reform Bill 2013: Committee Stage

 

11:20 am

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

We dealt with this at length previously in the context of Second Stage. This is the section that allows the courts, where an application is made for repossession, to adjourn the proceedings so that the possibility of an individual entering into a personal insolvency arrangement can be looked at. This is a radical change to the law. There was no connectivity in the past between the court jurisdiction where an application is made to repossess a home and any possible alternative insolvency arrangement into which an individual might enter. The personal insolvency arrangement provisions in the insolvency legislation contain a specific provision to try to ensure, in the case of someone who is seriously indebted but where, by rearranging their finances, they can be put back into some sort of economic health over a period of years, that their family home or principal private residence could be protected in the context of any appropriate arrangement that might be entered into between a debtor and creditors with the assistance of a personal insolvency practitioner. When that legislation went through the House I said that when we dealt with this Bill, I would provide the connectivity between the two. This does that. It allows initially for a two month adjournment of the repossession proceedings to examine the practical possibilities of a personal insolvency arrangement being put in place and if, after the two month period, some work has been done on that and it appears that it could be feasible, there would be a further adjournment, and the legislation does not specify the length of that adjournment.

This is designed to ensure debtors can avail of this as a last resort if they are confronted by repossession but it is also designed to encourage those in debt and creditors to use the mechanisms under the insolvency legislation before anyone embarks on repossession proceedings in respect of an individual's family home.

This is very important reform. When the original legislation was enacted in 2009 it was not envisaged any change was being made to the law; it was assumed with regard to pre-2009 mortgages the law would continue as it had been in the preceding centuries. The technical issue which arose as a result of the judgment delivered in the Start Mortgages case has resulted in us having to bring forward this legislation. It has also given us the opportunity to provide for very important reform designed to ensure where an individual or family is in financial difficulty and the difficulties include mortgage arrears, and where it is possible financially over a period of time to resolve these arrears through concluding a personal insolvency arrangement, that homes will not be repossessed. Obviously where there is no possibility of entering into a personal insolvency arrangement the ordinary rules which apply to the recovery of a home in circumstances where it has been used as security for borrowings will be applied by the courts. I hope that rather than Members of the House having any difficulty with the provision, it will be very substantially welcomed.

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