The End Of The Start Mortgages Issue?

Introduction

In a move that should be welcomed by mortgage lenders and other interested parties, such as purchasers of loans, structured credit or other assets backed by Irish real estate, the Minister for Justice, Equality and Defence, Alan Shatter T.D. published the Land and Conveyancing Law Reform Bill 2013 (the "Bill") on 28th March, 20131. The primary purpose of the Bill is to address the uncertainty arising from the interpretation by the High Court of the changes to the law brought about by the Land and Conveyancing Law Reform Act 2009 (the "2009 Act"). In addition, the Bill also proposes the adjournment of repossession proceedings in respect of a borrower's principal private residence where these could be resolved under the Personal Insolvency Act 2012.

Background

The background to the Bill involves the well-known Start Mortgages2 decision, which found that the repeal by the 2009 Act of certain provisions of the Registration of Title Act 1964 (the "1964 Act") had the unintended consequence of restricting mortgagees from exercising their right to repossession on a summary basis (i.e. using an expedited, simplified procedure).

Prior to the enactment of the 2009 Act, a mortgagee could apply to Court pursuant to the 1964 Act for an order for possession of land over which it had a registered charge, as soon as payment under that charge became due. However, in the Start Mortgages decision, the High Court held that, as the 2009 Act had repealed section 62(7) of the 1964 Act, mortgagees of...