Surveyors call for tribunal to settle lease disputes

A NEW system to resolve disputes over leases between landlords and tenants should be introduced, according to The Society of …

A NEW system to resolve disputes over leases between landlords and tenants should be introduced, according to The Society of Chartered Surveyors (SCS). The society says a mechanism, similar to a tribunal, would be faster and cheaper than the current system.

Under current legislation, where disputes arise over the renewal of commercial leases, landlords and tenants have no option but to go to court if they fail to reach agreement. The legal route results in lengthy delays and is very costly, the society says.

The SCS has made a submission on the matter to the Working Group on Courts Commission, which is examining the courts' system on behalf of the Department of Justice.

The society says that due to the exceptional workload of the Circuit Court, particularly since the introduction of the 1991 Courts Act, which altered the jurisdiction of this court from awards of Pounds 15,000 to Pounds 30,000, the number of cases listed for hearing has grown steadily.

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"It is now normal practice that both landlord and tenant have to wait 18 months before having a case dealt with in this court," the society's submission says.

Des Byrne, a director of Druker Fanning, who is on the SCS working committee which made the submission, told The Irish Times he is involved in a case which will not be heard for two years.

Mr Byrne says delays result in landlords being out of pocket for a considerable period, but the current system also places an undue burden on tenants as rent arrears mount up.

He says in many cases where landlords and tenants cannot agree on new rents, no rent is paid by the tenant until after the court case.

"The courts should be there to decide on legal matters, rather than have their time clogged up by having to adjudicate on what are essentially economic matters" he says.

The SCS is calling for a lands tribunal whereby a surveyor would deal with most cases on an individual basis, but would consult other members of the tribunal on points of law.

Other members would include a part-time president, who would be a judge and a full-time member, (a chartered surveyor). The administrative functions would be under the control of a registrar.

The society says the system in the North could be used as a model, as it seems to work in a speedy and cost effective manner.

Mr Byrne says many property-related issues are already being resolved using independent arbitration. For example, where rent reviews cannot be agreed, leases provide for the matter to be referred to an independent arbitrator, usually a chartered surveyor.

Another example is the method by which disputes over the value of land or buildings being compulsorily acquired by local authorities are resolved.

If both parties are unable to agree, a national property arbitrator, of which there are two in Ireland, will act as an independent adjudicator, hearing evidence from both sides and then assessing a value on the lands.

The society says it is costly for landlords and tenants to appear in court because each side normally briefs a valuer, solicitor and counsel.

In its submission, the society says judges who preside over landlord and tenant lease renewals are obviously expert in law but may not necessarily be expert in valuation matters, a point echoed by several surveyors.

Judges do not normally carry out site inspections, which would be desirable, according to Mr Byrne. If surveyors were adjudicating on cases, they would be properly qualified to visit the property in question.

One surveyor contacted by The Irish Times asked if judges were qualified to settle rents and other non-commercial issues?

John Costello, of Costello Commercial, valuation surveyors, says the establishment of a landlord and tenant tribunal would be a progressive move. "The existing lease renewal procedure, through the courts, is unsatisfactory in terms of the delay in getting the case to hearing, the costs involved and the rigid formal proceedings, which often intimidate the parties to the lease".

Mr Costello says surveyors are ideally qualified to operate the tribunals. "Indeed, the rates tribunal, which is already in existence, seems to be a logical blueprint for a cost-effective, time-efficient and 'user-friendly' body," he says.

Noel Quinn, of Quinn Agnew, auctioneers and surveyors, says a tribunal is a relatively quick way of resolving property disputes. The rating tribunal - where parties refer disputes over rating valuations - comprises two barristers, three solicitors, three chartered surveyors and one other valuer.

Mr Quinn says any three of them can sit at any one time and it would only be in a rare case where a valuer was not included in the group.

Bill Nowlan, a former chairman of the SCS, says such changes in the legislation would represent catching up on Britain and other European countries.

With disputes of this nature, they are very often better settled by people who are expert in valuations, rather than in the law, he says. "It is far quicker and far more private, whereas the court is created on a public basis," he says.

In its submission, the society proposes that appointments to the new tribunal should be based upon experience in landlord and tenant matters, and possibly an exam. Those who already have experience in acting as arbitrators or independent experts might prove suitable, it says.