The Gazette 1985

INCORPORATED LAW SOCIETY OF IRELAND GAZETTE

Vol. No. 79 No. 5

June 1985

Comment . . .

In this issue . . . Comment 159 How EEC Law Affects Practitioners. Part V. . . . 161 Practice Note 167 Joint Committee Building Societies/ Law Society 167

. . . Deposits at Risk — Again

I N the recent case of Roche -v- Peilow the Supreme Court has held that where a solicitor is acting for a client who proposes to enter into an arrangement with a builder/vendor, consisting of an agreement for the sale of a site coupled with a building contract, there is an obligation on the purchaser's solicitor to make searches not only in the Land Registry but, if the builder/vendor is a company, in the Companies Office in order to ensure that the site is not encumbered by way of a legal or equitable mortgage. In the case in question, the solicitors had warned the purchaser that by making periodic payments during the course of the building they were liable to lose all the payments if the builder became insolvent and the purchaser had accepted that risk. The Supreme Court took the view that this warning of itself was not sufficient and that the solicitor should have made the search in the Companies Office in order to be in a position to advise the client of the further risks involved if the land were encumbered. The decision highlights yet again the urgent need for arrangements to be made to protect deposits and payments on account made to builders in respect of houses in the course of construction. The Law Society has in the past explored with Merchant Banks involved in the financing of house building construction the possibility of arranging for some method of protecting purchasers' deposits and payments on account. It is clear, however, that because of the under-capitalization of most builders payments received from the purchasers are essential to the financing of the work in progress. From its inception the Law Society and the Dublin Solicitors' Bar Association have continuously criticised the failure of the National House Building Guarantee Scheme to include protection of deposits and payments on account made to builders. The recent Barrett Apartments case and now the Roche -v- Peilow case have heightened the need for such protection to be extended. The U.K. Scheme has provided protection of this sort to the public for over twenty years and it is past time that the Irish scheme came into line. •

Family Law Act 1981

169

Crossword

174

Land Registry Copy Folios

175

Medico-Legal Society

175

Book Reviews

176

Solicitors' Golfing Society

178

The Mistaken Improver of Land

179

Know Your Council 84/85

184

Correspondence

185

IBA — Singapore Conference

189

Professional Information

190

Mary Buckley William Earley, Chairman John F. Buckley Gary Byrne Geraldine Clarke Charles R. M. Meredith Michael V. O'Mahony Maxwell Sweeney

Executive Editor: Editorial Board:

Advertising: Printing:

Liam O hOisin, Telephone 305236 Turner's Printing Co. Ltd., Longford

The views expressed in this publication, save where other- wise indicated, are the views of the contributors and not necessarily the views of the Council of the Society. The appearance of an advertisement in this publication does not necessarily indicate approval by the Society for the product or service advertised.

Published at Blackhall Place, Dublin 7.

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