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GAZETTE
FEBRUARY
1989
Correspondence
The Editor,
Law Society Gazette,
Blackhall Place,
Dublin 7.
21st November, 1988
Re:
Building Societies and
Tiered Rates
Dear Sir,
As Conveyancers will be aware,
the Building Societies' (Amend-
ment) Act 1986 prohibits tiered
interest rates with effect from the
1st April, 1987. Tiered rates are
defined as meaning the rate of
interest on a loan where such rate
is determined by reference to the
amount of the loan made and is
greater than the lowest rate of
interest applicable to borrowers
generally.
On a couple of occasions
recently I have acted for clients
borrowing from the EBS, where
loan approval has been sanctioned
"subject to interest rate being one
quarter of a percent above home
loan base rate". Being concerned as
to whether such a condition could
be construed as amounting to a
tiered rate in contravention of the
Act I made enquiries with the EBS,
who justify such a condition on the
grounds that this levy is charged to
borrowers not having any savings
record with them. I understand that
the Irish Nationwide adopted a
similar policy.
In raising the matter with the
Department of the Environment
they advise me that they were
aware of such conditions but they
do not take the view that such a
condition amounts to the re-
imposition of a tiered rate couched
in different terms.
I have noted also that the EBS in
their standard loan approval letter
stipulates that approval is subject
to insurance being effected with
their nominated Insurers. Again,
this is in clear contravention of the
Act which gives the Borrower a
choice in relation to Insurers. Again
from enquiries that I have made
with the EBS, they advise me that
as long as an appropriate indemnity
and transfer is obtained from the
borrower he could insure with
whomsoever he wished. If this is
the case why do the Societies not
stipulate such choice in their
standard conditions.
Members may wish to note
therefore that by imposing levies on
borrowers the Building Societies
appear to be side-stepping the pro-
visions of the Act in disregard of its
well-intentioned provisions.
Yours faithfully,
KEVIN O'HIGGINS
Solicitor,
T. F. O'Connell Rooney & Co.,
34 Kildare Street,
Dublin 2.
Irish Stenographers
Limited
(Director:
Sheila Kavanagh)
Qualified Experienced Stenographers.
Fast, efficient service.
Overnight Transcripts by arrangement
Contact: Secretary,
"Hillcrest", Dargle Valley,
Bray, Co. Wicklow.
Telephone: 01-862184
Younger Members
Quiz Nights
7 March, 1989: Welcome Inn
Hotel, Castlebar. 8.00 p.m. Contact
Eva Tobin. Tel. (094) 21854.
14 March, 1989: Old Ground
Hotel, Ennis. 8.00 p.m. Contact
David Casey. Tel. (065) 28159.
29 March, 1989: Ardree Hotel,
Waterford. 8.00 p.m. Contact
Gabrielle Dalton. Tel. (051) 72934.
5 April, 1989: Royal Marine Hotel,
Dun Laoghaire. 7.30 for 8.00 p.m.
Contact John Larkin. Tel. (01)
613311.
21-23 April, 1989: Sys Weekend
Conference. Limerick Inn Hotel.
Speakers: Prof. Bryan McMahon
and Robert Pierse.
PEOPLE . . .
Ms. Laetitia Baker, Solicitor, of Skibbereen, Co. Cork, has been
elected National President of Junior Chamber Ireland.
Robert W. R. Johnston, Solicitor, has been elected President of
the Confédération Fiscale Europeéne for a two year period
commencing 1 January, 1989.
Laurence Cullen, Solicitor, has been elected to the 1988/89
American Judicature Society Board of Directors.
Ken Murphy recently moved to
Brussels to open a new branch office
there for his firm A. & L. Goodbody. He
is confident, however, that he will be
able to fully maintain his contribution
as a member of the Council of the Law
Society and he is now ideally placed
to fulfil his role as Chairman of the
E.C. (1992) and International Affairs
Committee.
Ken Murphy.
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