The Minister for Justice, Equality and Defence published the long anticipated "Land and Conveyancing Law Reform Bill 2013" on Thursday, 28 March 2013.
The purpose of this Bill is to ensure that certain statutory protections that apply to mortgages created pre-1 December 2009 will continue to apply notwithstanding the repeal of certain statutory provisions by the Land and Conveyancing Law Reform Act 2009 (the 2009 Act).
As detailed in earlier Client Alerts, problems initially arose out of a decision of Justice Dunne in Start Mortgages Ltd –v- Gunn (July 2011) which had the effect of calling into question the availability to lenders of certain enforcement remedies, more specifically, claims for possession of registered property under Section 62(7) of the Registration of Title Act 1964.
The Bill proposes to correct the unintended consequences arising from the commencement of the 2009 Act by providing that, in relation to pre-1 December 2009 mortgages, certain statutory provisions that were repealed by the 2009 Act, may be invoked or exercised by a person as if those statutory provisions had not been repealed by the 2009 Act.
The Bill however states that these provisions will not apply to proceedings already initiated before the coming into operation of this legislation. The Bill also includes a new provision whereby a court (where it considers it appropriate) may decide, or a borrower may apply, in relation to proceedings for the repossession of a principal private residence, to have those proceedings adjourned for a period not exceeding two months, to allow the borrower to consult with and/or instruct an insolvency practitioner with a view to putting in place a Personal Insolvency Arrangement (PIA) under the Personal Insolvency Act 2012.
The Bill sets out certain matters to be taken into consideration by a court before deciding whether or not to allow such an application by a borrower and includes matters such as the level of participation by the borrower in the arrears process to date, payments made and the conduct of the parties in attempting to resolve the payment arrears.
This Bill should provide a welcome relief to lenders as it removes the uncertainty created by the Start Mortgages decision in relation to enforcement remedies. In addition, the inclusion of a provision enabling a court to adjourn proceedings for possession of a principal private residence will put lenders on notice of potential insolvency proceedings where it is availed of by a borrower.