The Minister for Justice, Equality and Law Reform, Mr Michael McDowell, T.D., has today announced his intention to provide in law for any business tenant to contract out of the provisions of the Landlord and Tenant (Amendment) Act 1980 on the right to a new tenancy, provided that the tenant has received independent legal advice.
"This facility is already available to some business tenants, but only where the premises are let as office accommodation", said Minister McDowell. "The proposal to extend it to all classes of business tenancy, including existing tenancies, is a deliberate policy change to meet the dynamic market economy that exists in the State. It is intended to allow greater flexibility than at present in the arrangements which business landlords and tenants choose to make between each other. At the same time, it maintains a good balance between sometimes competing interests by ensuring that tenants cannot sign away the protections at present afforded by the law without first having obtained independent legal advice on the matter."
This amendment to landlord and tenant law will be included in the Civil Law (Miscellaneous Provisions) Bill, due for publication during the current session.
On another aspect of landlord and tenant law of interest primarily to the business community, the Minister has also announced his intention to amend the Registration of Deeds and Title Bill 2004 - which is currently before the Dáil - in order to protect property in cases where the acquisition of the fee simple by a tenant was neither intended nor foreseen under the Landlord and Tenant (Ground Rents) Acts 1967 to 1987.
The Minister said that the Government had enacted legislation in 2005 to deal with a number of cases where the possible acquisition of the fee simple in property was neither intended nor foreseen under ground rents legislation. For example, the Landlord and Tenant (Ground Rent) Act 2005 added the IDA, Shannon Development and Udaras na Gaeltachta to the list of State bodies which are not bound by the Act. Subsequently, the Maritime Safety Act 2005 was amended in order to add harbour companies to the list of protected bodies. The effect of these legislative measures was to exempt the bodies concerned from the ground rents legislation and thereby protect the State property concerned.
Explaining his intention to enact a general measure in order to avoid any similar problems in the future, the Minister said that this will be done by means of appropriate amendments to the Registration of Deeds and Title Bill 2004, which is currently awaiting Committee Stage in the Dáil (having passed through the Seanad).
Specifically, he proposes to amend two provisions of the the Landlord and Tenant (Ground Rents) (No.2) Act 1978:
- Firstly, an amendment to section 16 (restrictions on right to acquire fee simple) in order to remove the entitlement to acquire the fee simple in cases where the lease is a sublease granted by a lessee who is not eligible to acquire the fee simple. In effect, this will prevent the creation of eligible subleases out of non-eligible leases. It is intended that the removal of the entitlement will apply to all subleases granted on or after today, 27 February.
- Secondly, an amendment of section 28 (effect of acquisition of fee simple on covenants) to restrict the extinguishment of covenants to acquisitions of the fee simple under the 1978 (No.2) Act and to those affecting the land in the lease under which the land was held. This will mean that 'collateral' covenants outside the lease will no longer be extinguished on acquisition of the fee simple.
27 February 2006