The Gazette 1993

VOL.

NO.

JULY/AUGUST 1993

all such elements, only those quintess-

ential parts peculiar to ground rents.

Nevertheless, the legislation will be

more easily assimilated if the evolu-

tion of the present system is reviewed,

however briefly and incompletely.

What therefore are the ground rent's

more characteristic rules, compliance

with which is required by this

involved legislation which, the writer

feels, is certain to remain relevant? To

enable a leaseholder to claim the fee

simple, or a reversionary lease, the

three conditions, for example, at s.

9(1 )(a), (b) and (c) of the 1978 (No. 2)

Act must be complied with. These

three conditions are entitled, as are

others, to be called "threshold"

conditions but including, for example,

as they do, the requirement that the

portion of the land not covered by the

permanent buildings be subsidiary and

ancillary to such buildings, a

requirement for new tenancies echoed

by s. 5(1 )(a)(ii) of the 1980 Act, the

writer feels that they are less

representative of the ground rent

legislation than the seven alternative

conditions in s. 10 and their

counterpart in s. 15 (as amended),

both of the 1978 (No. 2) Act, with one

of which "equities" the applicant must

comply. It is with these alone (and

then only with three of them) that this

short article will deal.

1. The Typical Building Lease

When it was at length decided to

provide a remedy for the fundamental

grievance of the ground lessee who on

the expiry of his lease was obliged to

surrender building as well as site to a

landlord whose predecessor had pro-

vided only the site, the Oireachtas did

not think, at first, in terms of giving

certain tenants the statutory right to

purchase the fee simple (enfranchise-

ment). Instead the first effective

attempt

to respond to this anomaly

was the creation by the 1931 Act of the

statutory reversionary lease. This

enabled any person holding land under

a building lease to obtain from the

landlord a 99 year lease at a low rent.

For the purposes of Part V of the 1931

Act which dealt with reversionary

leases s.46(l)(d) defined "building

lease" to mean a lease of land,

inter

228

alia

on which the permanent buildings ,

' were erected by the person who, at the

time of such erection, was entitled to

the lessee's interest under such lease.

Finn

.v.

Barry

was, however,

held by the Supreme Court that the

interest of a lessee did not commence

until the date of execution of the lease

and that, therefore, at the time the

houses were erected, the applicant was

not "entitled to the lessee's interest

under such lease." Accordingly,

s.46(l)(d) was amended so as to

include a lease of land,

inter alia,

which:

(d)

such permanent buildings were

erected by the person who, at the

time of such erection, was entitled to

the lessee's interest under such lease;

or were erected in pursuance of an

agreement for the grant of such lease

upon the erection of such permanent

buildings.

The paragraph so amended is now

represented by the almost identical

alternative condition 1 in s. 10 of the

1978 (No. 2) Act, with reference of

course not only to obtaining a

reversionary lease but also to the

acquisition of the fee simple.

2. Long Lease at a Low Rent

By 1954, when the Rents and

Leaseholds Commission issued its

report

the difficulties encountered in

proving who had erected the build-

ings, had made themselves felt. By the

time an application for a reversionary

lease was made, those who had

negotiated the lease or erected the

buildings were, in most cases, dead.

No information as to whether the

buildings existed at the time of the

lease could usually be gleaned from

the recitals or the parcels in the lease.

Where the buildings were erected in

pursuance of an agreement for a lease,

it was rare for the lease to recite the

previous agreement.

The Commission recommended

that, j

where a lease was for a term of not

less than 50 years, and the rent was

less than the earliest available rateable '

valuation of the plot together with the

buildings on it, it should be presumed

until the contrary was proved, that the

buildings were erected by the person

entitled to the lessee's interest under

the lease. In general, this was adopted

by the 1958 Act except in the case of

a lease granted before 1 January,

1914', when the rent had to be less

than three-fourths of the relevant RV.

Today, alternative condition 2

requires a lease for a term of not less

than 50 years where

the yearly r en t. . .is less than the

amount of the rateable valuation, and

. . . the permanent buildings on the

land demised by the lease were not

erected by the lessor or any superior

lessor or any of their predecessors in

title:

provided that it shall be presumed,

until the contrary is proved, that they

were not so erected.

Furthermore, the RV referred to in

condition 2 is not the earliest available

valuation but virtually the current RV

and this, if indeed it signifies nothing

else, is at least a convenience for the

practitioner.

3. The Yearly Tenant

The solicitor who is alert to avoid

steering his client towards a new

tenancy in case he may prove entitled

to acquire the fee will not be free to

relax if his client is not a leaseholder.

The 1964 Report of the Ground Rents

Commission spoke about the

representations that had been made to

them on behalf of certain houses in

provincial towns, adding:-

ln many towns these houses were

built by persons who held the land

on oral yearly tenancies. In other

towns the houses were built on what

may have been short term leases

originating upwards of 150 years

ago. If there were such leases the

terms have long since expired and no

evidence appears to have been

available as to the existence of the

leases. In both types of cases the

present occupiers pay a rent which

approximates to a ground rent.

Under the present law their interest

in the premises appears to be no

more than that of a person holding

under a yearly oral tenancy

This brief reference is intriguing and it