Courts to consider new factors before ordering repossession

The Land and Conveyancing Law Reform (Amendment) Act 2019 (the “Act”) introduces a list of factors that must be taken into consideration by the Court before an order for possession can be granted or refused. The Act builds upon the protections given to borrowers under the Personal Insolvency legislation, which allows the Court to adjourn proceedings to facilitate a borrower getting a proposal together for a Personal Insolvency Arrangement (“PIA”).  

The Act does not apply in all circumstances. For the Act to apply the property must be the Principle Private Residence of the borrower or a spouse/civil partner and one of the following needs to be met;

1. Proceedings must have been adjourned for the purposes of getting a proposal for PIA.
2. There must be engagement with a Personal Insolvency Practitioner to resolve his or her arrears.
3. The borrower was refused an adjournment for the purposes of getting a proposal together.
4. The borrower participated in a designated scheme for the reduction of arrears in good faith, such as a PIA.

The factors that must be taken into consideration are;

• Whether the making of an order for possession is proportional in all circumstances.
• The circumstances of the borrower and his or her dependents.
• Whether the bank or lending institution has issued a statement of terms in which they would be willing to settle the matter.
• Details of any proposal made by the borrower that would result in them remaining in their home or securing alternative accommodation.
• The response to such a proposal.
• The conduct of the parties in any attempt to find a resolution.

In evaluating what is proportional, the Court may have regard to;

• Total amount that remains to be paid.
• The amount of arrears of payments due.
• The advised market value of the property.

There is unlikely to be a radical change in the process of getting an order for possession as judges were previously considering these factors in an informal way. However, there is the potential this will increase delays and costs in the Court process, especially where a valuation will be required.  It is therefore imperative that the appropriate steps are taken, and checks made prior to seeking an order for possession.

For further information please contact Jerry Burke (Partner), Geoffrey Rooney (Solicitor) or your usual AMOSS contact.