Property II

Forfeiture

A range of legislation allows for forfeiture of the proceeds of crime, articles involved in crime or the assets of persons involved in crime. They have been held not to be in the nature of criminal proceedings, but to be civil proceedings. Accordingly, the provisions applicable to criminal proceedings do not apply.

Generally, the courts have upheld forfeitures, even arising in consequence of an offence. They indicate that a person takes the risk of forfeiture in illegally importing or exporting his own property and has no reasonable cause to complain of injustice if it is forfeited in consequence of a customs offence. Even a hirer to hire purchaser who was not involved may lose a hired vehicle on the basis that refusal to allow otherwise would circumvent the legislation.

The Proceeds of Crime Act, which allows for civil confiscation of prime proceeds and assets held by convicted persons, has been held to be valid by the Supreme Court. The defendants did not dispute that it was constitutionally permissible to allow confiscation but challenged the taking on other grounds.

A provision in the Proceeds of Crime Act, which permitted senior officers of An Garda Síochána to freeze property transactions without judicial intervention, was held to be invalid in Vehicle Tech Limited v AIB. No prior notice was given to the owner as to how it was imposed nor was the provision for variation nor limits on the time it could last.

Taxation

The courts give significant latitude to the Oireachtas in setting the terms of taxation. A challenge to the former Residential Property tax legislation was rejected in Madigan v. the Attorney General. It was argued to be discriminatory and to create anomalies.

However, the court indicated that anomalies could arise in any tax legislation and this did not render legislation unconstitutional. It pointed out that treating persons equally might itself be in breach of equality provisions where there are differences in capacity of the persons addressed.

The system of rates on agricultural land which continued to be based on mid-19th century valuations was held to be so arbitrary as to be unconstitutional. The rates were acknowledged to be wholly out of date and anomalous due to enormous changes which had happened since the initial 19th-century valuations. The rateable valuations affected not only rates payable on land but also income tax liability and entitlement to various State benefits.

The system of the grossly outdated valuations was held to breach Article 40.3. Use of the 1852 valuations continued as a basis for agricultural rates long after the uniformity, inconsistencies and anomalies had been established and long after methods of agricultural production had changed drastically.

This in itself was an unjust attack on the property rights of those who like the plaintiff found themselves paying more than their neighbours with better land. When this injustice has become obvious, the State has a duty to take action in the protection of the rights involved.

Rights to take Litigation

The right to take litigation may be in the nature of a property right. Certain intangible rights may only be asserted by court action.

The Health (Amendment) (No. 2) Bill 2005 sought to retrospectively exempt the Minister from liability to make the repayments of withheld social welfare pension payments, which had been unlawfully deducted from persons maintained in hospitals or homes by the Health Boards. On reference to the Supreme Court, it was held that the retrospective attempt to exempt the Minister from liability for reclaiming the payments without compensation was a substantial encroachment on property rights without compensation, which could rarely be justified.

“Where a statutory measure abrogates a property right as the Bill does and the State seeks to justify it by reference to the interest of the common good, or those of the general of public policy involving matters of finance alone, such a measure if capable of justification could only be justified as an objective imperative for the purpose of avoiding an extreme financial crisis or disequilibrium in public finances.” This did not apply in this case and the provision was found to be an unjust attack on property rights.

In O’Brien v Keogh the unduly short time as the short time limit for legal action was found unconstitutional because it failed to adequately protect the rights of children who had personal rights of actions in relation to personal injuries. It was similarly indicated in Wright v. Dublin City Council that a short time limit for challenging a planning decision might be unconstitutional for the same reasons.

The courts, however, have generally upheld Statutes of Limitation periods.

Rent Restriction

The rent restrictions legislation did not apply to all comparable situations and tenancies were controlled in 1960 because they had been controlled by previous temporary legislation. The legislation did not apply to local authority houses. The landlord and tenant’s ability to pay was of no relevance.

There was no suggestion that security of tenure and rights of renewal would be unconstitutional per se. However, in the case of the rent restrictions legislation, they were an integral part of an arbitrary and unfair statutory scheme, whereby tenants of controlled properties were singled out for especially favourable treatment both as to rent and security of tenure regardless of social or financial need.

The emergency legislation introduced in response to the above case, the Housing (Private Rented Dwellings) Bill was referred to the Supreme Court. The Bill was found to be unconstitutional. The rent was not to be the market rent but was to increase from 40% to 100% over a five years transitional period. The Supreme Court found this Bill to be inconsistent with the constitutional rights of the landlord.

Various

Legislation freezing wage increases in banks in the 1970s was found to be constitutional. The courts referred to the legislature’s role in striking a balance in economic and social matters. There was sufficient reasonable basis upon which legislature could act, given the circumstances of high inflation at the time.

A challenge to the constitutionality of the National Asset Management Agency Act 2009 was rejected. It was not a disproportionate interference with property rights. The effect of the legislation was to compulsorily transfer loans from banks to NALM. The rights of borrowers remained substantially unchanged. The courts did find that fair procedures were required in relation to the transfer under the legislation, on the basis that NAMA was a public body.

In O’Callaghan v. Commissioners of Public Works, the designation of a monument without a fair hearing, by way of a preservation order without fair procedure which resulted in sterilisation of the property without compensation was claimed to be unconstitutional. However, the Supreme Court held that the common good requires national monuments to be preserved. It indicated that where land was purchased with the knowledge that it contains a monument, there is no basis for claiming compensation. The position might be different if it was not apparent that there was a monument or artefacts on the land.