On Friday February 3, Stephen will open debate in the Dáil on a small but significant piece of new legislation: the Family Home Protection (Miscellaneous Provisions) Bill 2011.
This bill, drafted with Ross Maguire SC of New Beginning, will give judges the discretion to weigh some key factors when deciding whether to allow a mortgage lender repossess a family home. Till now, judges have no discretion – if the mortgage holder is in default, the judge is obliged to give the order for possession. This short bill, if passed, will allow judges look at the behaviour of both lender and borrower in determining whether repossession is necessary and appropriate, or not. We’ll be publishing more information on it here in the coming days.
These Friday private members’ sessions (one per month) are a new initiative in the Dáil, designed to give TDs more opportunity to propose legislation.
The Bill is published on the Oireachtas website, here, and can be downloaded here, along with the explanatory memorandum.
Family Home Protection (Miscellaneous Provisions) 2001 Bill
Famly Home Protection Bill Explanatory Memorandum
FAMILY HOME PROTECTION (MISCELLANEOUS PROVISIONS) BILL, 2011
Long Title: Bill entitled an Act to enable the Court to have regard to various, cited matters when determining whether to grant or refuse an application for possession of a family home
ARRANGEMENT OF SECTIONS
Section
- Interpretation.
- Matters to be considered by a Court during proceedings for possession of a family home.
Interpretation.
1.-(1) In this Act, except where the context otherwise requires –
“court” means the High Court, the Circuit Court, the District Court or a County Registrar.
“dwelling” means any building or part thereof, occupied as a separate dwelling and includes any garden or portion of ground attached to and usually occupied with the dwelling or otherwise required for the amenity or convenience of the dwelling.
“family home” means a dwelling in which a person or persons ordinarily reside.
“proceeding for possession” means an application to a Court made by any party pursuant to the terms of a mortgage agreement or registered charge, for the purposes of the granting of an order of possession and/or repossession of the family home securing the loan, the subject matter of the said mortgage agreement or registered charge.
“mortgage” shall include registered charge.
“mortgage debt” means the debt secured by the family home.
Matters to be considered by a Court in a proceeding for possession of a family home.
2. (1) In any proceeding for possession of a family home the Court, in determining whether to grant or refuse such application, may have regard to the following matters:
a) Any offer, including an offer involving the restructure of the loan, made by or on behalf of the borrower;
b) The level of arrears on the loan;
c) The current market value of the home and the amount of the mortgage debt as a proportion of that;
d) Evidence from an expert or experts as to the expected value of the family home over a period of 5 years from the date of the hearing of the proceeding for possession;
e) Any Code of Conduct or other such agreement or regulation to which the party applying for the order of possession is a party to, for the time being in force
f) The conduct of the lender;
g) Any other matter that the Court shall, in its opinion, consider proper to take into consideration.
FAMILY HOME PROTECTION (MISCELLANEOUS PROVISIONS) BILL, 2011
EXPLANATORY MEMORANDUM
Purpose of this Bill
The purpose of this bill is to provide for the courts to be able to take into consideration certain key matters when deciding on a proceeding for possession of a family home. The current situation, as stated in Bank of Ireland v Smyth and Anglo Irish Bank Corporation PLC v Fanning, is that the courts do not have discretion in this area. If a homeowner is in default on a mortgage, and the lender seeks possession, the courts have no discretion in deciding whether or not to award possession, irrespective of whether the home is a family home. This is despite the protections afforded the family in Article 41.1 of the Constitution, which “recognises the Family as the natural primary and fundamental unit group of Society, and as a moral institution possessing inalienable and imprescriptible rights, antecedent and superior to all positive law”, and “guarantees to protect the Family in its constitution and authority, as the necessary basis of social order”. Giving the courts limited discretion would allow for greater protection of the family home, in the broader societal interest, without prejudicing the interests of the party seeking possession. This discretion should allow consideration of matters including the ability of a homeowner to service their mortgage debt, any likely appreciation in value of the property, and other factors relevant to an assessment of the fairness of proceedings for repossession of the home.
Provisions of the Bill
Section 1 defines terms used in the Bill.
Section 2 sets out the matters to which the Court may have regard when deciding on an application for possession of a family home. These are:
a) Any offer, including an offer involving the restructure of the loan, made by or on behalf of the borrower;
b) The level of arrears on the loan;
c) The current market value of the home and the amount of the mortgage debt as a proportion of that;
d) Evidence from an expert or experts as to the expected value of the family home over a period of 5 years from the date of the hearing of the proceeding for possession;
e) Any Code of Conduct or other such agreement or regulation to which the party applying for the order of possession is a party to, for the time being in force
f) The conduct of the lender;
g) Any other matter that the Court shall, in its opinion, consider proper to take into consideration.
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This Bill was originally introduced by Stephen in the Dáil on November 2, 2011.