# Land and Conveyancing Reform Bill and PIAs



## Brendan Burgess (24 Apr 2013)

The primary purpose of the Bill is to remove the problem which had prevented repossessions. 

But it also allows a judge to direct the parties to consider a PIA.


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## Brendan Burgess (24 Apr 2013)

Here is the relevant text with the Explanatory Memorandum 

[FONT=&quot]Section 2 of the Bill provides that a court, where it considers it appropriate or on application by a borrower, in proceedings for repossession of a principal private residence, may in certain circumstances adjourn the proceedings to enable the parties to consider whether a Personal insolvency Arrangement (PlA) under the Personal Insolvency Act 2012 would be a more appropriate course 0 f action than repossession.
 [/FONT]



> [FONT=&quot;]2._(1)              This section  applies  to land which is the principal  private  residence  of the mortgagor  or a person  whose consent would be required  under the Family Home Protection  Aet  1976 to the conveyance  within the meaning  of that Act of an interest in that land.[/FONT]


[FONT=&quot]Subsection (1) makes it clear that the provision relates only to principal private residences. The provision is worded to allow for situations where the mortgage on the
property is in the name of one person only but that person has, for whatever reason, ceased to live in the house and the Family Home Protection Act 1976 applies.[/FONT]


> [FONT=&quot;](2)          [/FONT][FONT=&quot;]In [/FONT][FONT=&quot;]any proceedings  brought by a mortgagee  seeking  an order for possession  of land to which the mortgage  relates in a case to which  this section applies, the court, without prejudice  to any other power which a court may have to adjourn  proceedings,  may-[/FONT]
> 
> [FONT=&quot;](a)        of its own motion,  if it considers  it appropriate  to do so,[/FONT]
> 
> ...


[FONT=&quot]

Subsection (2) allows the court, either of its own motion or on the application of a person, to consider the granting of an adjournment, for a maximum of  2 months, to enable the parties to consider the use of a Personal Insolvency Arrangement.[/FONT]





> [FONT=&quot;](3)          The court in considering  an application  under _subsection  (2)(b) _shall have regard to such matters  as it considers  appropriate  and in particular  shall have regard to the following:[/FONT]
> 
> [FONT=&quot;](a)        whether the mortgagor has participated  in any process  relating to mortgage  arrears operated  by the mortgagee  concerned which has been approved  or required  by the Central  Bank. of[/FONT] [FONT=&quot;]Ireland  and which process  relates to the land the subject  of the[/FONT] [FONT=&quot;]mortgage;[/FONT]
> 
> ...


[FONT=&quot]Subsection (3) outlines certain matters the court may take into account in its consideration of the application for an adjournment. These include whether the borrower has engaged in a process relating to mortgage arrears, whether payments have been made by the borrower in the preceding 12 months, whether the matter has been adjourned previously and the conduct of the parties to the mortgage in seeking to resolve issues concerning arrears on the mortgage.[/FONT]





> [FONT=&quot;](4)              On  the expiry   of any  period  of adjournment       granted   under  [/FONT]_[FONT=&quot;]subsection [/FONT]_[FONT=&quot;](2), the court  may  grant  a further   adjournment          of the  proceedings               concerned        where   it considers   that  [/FONT][FONT=&quot;]signi [/FONT][FONT=&quot;]ficant  progress   has been  made   in the  preparation of a proposal   for a Personal   Insolvency             Arrangement.[/FONT]


  [FONT=&quot]Subsection (4) provides that at the end of the adjournment period the court may grant a further adjournment if it considers that sufficient progress has been made on the
matter of a PIA.[/FONT]




> [FONT=&quot;](5)              This  section   applies   as respects  mortgages     created   before  or after  the coming   into  operation                               of Part   10 of the Land  and  Conveyancing          Law  Reform   Act[/FONT]
> [FONT=&quot;]2009.[/FONT]


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## Brendan Burgess (2 May 2013)

Here is the debate from Tuesday night.

I am surprised that there is so little discussion about this. 

http://www.kildarestreet.com/debates/?id=2013-04-30a.372


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## Brendan Burgess (2 May 2013)

*[FONT=&quot]Here are some amendments I would like to see
[/FONT]*
*[FONT=&quot] [/FONT]*
  [FONT=&quot] (2)         [/FONT][FONT=&quot]In [/FONT][FONT=&quot]any proceedings  brought by a mortgagee  seeking  an order for possession  of land to which the mortgage  relates in a case to which  this section applies, the court, without prejudice  to any other power which a court may have to adjourn  proceedings,  may ….adjourn the proceedings  for a period not exceeding  2 months  to enable the relevant person -[/FONT]
  [FONT=&quot](i)         to consult with a personal  insolvency  practitioner  with a view to  the making of a proposal  for a Personal Insolvency  Arrangement,  and[/FONT]
  [FONT=&quot] [/FONT]
  [FONT=&quot](ii)        where appropriate,  to instruct  the personal  insolvency practitioner  to make a proposal  for a Personal Insolvency  Arrangement  under  the Act of 2012.[/FONT]
*[FONT=&quot]Suggested addition [/FONT]*
[FONT=&quot](iii) or on the application of the mortgagor, to give the mortgagor an opportunity to seek to sell the house in an orderly manner [/FONT]
  [FONT=&quot] [/FONT]
  [FONT=&quot]If the borrower is trying to sell the house but the bank is trying to repossess it, this would allow the judge to give more time to the borrower to agree a sale. There might need to be some restrictions to prevent the borrower from trying to sell the property and undervalue. If the borrower uses a reputable firm of estate agents and they give evidence that the offer received is reasonable, then the court should allow the sale, even if the bank objects. [/FONT]
  [FONT=&quot] [/FONT]
  [FONT=&quot]The existing text Section 2(3) [/FONT]
  [FONT=&quot](3) The court in considering an application under _subsection (2)(b) _shall have regard to such matters as it considers appropriate and in particular shall have regard to the following:[/FONT]

[FONT=&quot](a) whether the mortgagor has participated in any process relating to mortgage arrears operated by the mortgagee concerned which has been approved or required by the Central Bank. of[/FONT] [FONT=&quot]Ireland and which process relates to the land the subject of the[/FONT] [FONT=&quot]mortgage;[/FONT]

[FONT=&quot](b) whether the mortgagor has made any payments to the mortgagee in respect of monies advanced on foot of or secured by the mortgage in the 12 months immediately preceding the application and, if so, the amount of any such payments, the number and frequency of such payments, and the proportion which the amounts paid bear to the amount of any regular payments which the mortgagor was required to make under the terms of the mortgage or any associated loan agreement; [/FONT]

[FONT=&quot](c) whether the proceedings have been adjourned on any previous occasion at the request of the mortgagor, and, if so, the number of any such adjournments and the period of such adjournments and the reasons for such adjournments;[/FONT]

[FONT=&quot](d) the conduct of the parties to the mortgage in any attempt to find a resolution to the issue of dealing with arrears of payments due on foot of the mortgage; and[/FONT]

[FONT=&quot](e) whether, having regard to the circumstances of the case, the application for an adjournment appears to the court to be[/FONT] [FONT=&quot]primarily for the purpose of delaying the progress of the proceedings.[/FONT]
  [FONT=&quot] [/FONT]
*[FONT=&quot]Additions [/FONT]*
*[FONT=&quot](f) Whether the mortgagee has made any proposals for the settlement of any shortfall remaining after the property is sold [/FONT]*
  [FONT=&quot] If the lenders include a proposal to write off the shortfall, then the court should be more open to granting repossession. I use the word “settlement” as the banks don’t like the word “write-off”. And, of course, a settlement could mean, paying 10% of the shortfall in full and final settlement. [/FONT]
*[FONT=&quot](g) Whether the mortgagee and mortgagor has made any attempt to resolve the matter through voluntary sale or voluntary surrender [/FONT]*
  [FONT=&quot]Where the mortgage is unsustainable and the house is too big for the borrower, they should be aiming for a voluntary sale. If the bank did not offer this, then repossession should be deferred to allow the borrower to sell the property. If the bank offered it and the borrower refused, the judge should be more inclined to grant repossession[/FONT]
*[FONT=&quot]Amendments [/FONT]*
  [FONT=&quot]1)      [/FONT][FONT=&quot]  I don’t like this bit[/FONT]
  [FONT=&quot]“[/FONT][FONT=&quot]the proportion which the amounts paid bear to the amount of any regular payments which the mortgagor was required to make under the terms of the mortgage or any associated loan agreement;[/FONT][FONT=&quot]”[/FONT][FONT=&quot][/FONT]
  [FONT=&quot]Say I have a cheap tracker  mortgage of €100k  at 2% with  10 years to go.  Let[/FONT][FONT=&quot]’[/FONT][FONT=&quot]s say that the property is worth €200k.  [/FONT]
  [FONT=&quot]The monthly repayments are €920 but the interest is only €166. [/FONT]
  [FONT=&quot]If I am paying €460 per month, I am paying all the interest and also paying off the capital. The bank could try to repossess this as they would recover their loan in full and exit a cheap tracker. Tthe bank would argue under this section that I was paying only half of the amount due.  In a sense, that is not really relevant. How about changing it to[/FONT]
  [FONT=&quot]“[/FONT][FONT=&quot]the proportion which the amounts paid bear to the interest due on the mortgage ;[/FONT][FONT=&quot]”[/FONT][FONT=&quot][/FONT]
  [FONT=&quot]I don[/FONT][FONT=&quot]’[/FONT][FONT=&quot]t   presume  you can say [/FONT][FONT=&quot]“[/FONT][FONT=&quot]and where the borrower is paying at least the interest on their mortgage, they should not be repossessed[/FONT][FONT=&quot]”[/FONT][FONT=&quot] [/FONT][FONT=&quot][/FONT]
  [FONT=&quot] [/FONT]
  [FONT=&quot]2)      [/FONT][FONT=&quot](d) the conduct of the parties to the mortgage in any attempt to find a resolution to the issue of dealing with arrears of payments due on foot of the mortgage; and in particular the extent to which the mortgagee has complied with the Code of Conduct on Mortgage Arrears or equivalent code as issued by the CB. [/FONT]
  [FONT=&quot] [/FONT]
  [FONT=&quot] [/FONT]


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