How could a rent freeze be unconstitutional, if rent controls and RPZs are not?

hatrickpatrick

As many of you will have heard, there's been a debate this week over a rent freeze bill which looks set to pass in the Oireachtas (I'd imagine it will probably be blocked by the government using a money message, and held in limbo until and if that mechanism is watered down - but that's a debate for another day), and in the context of the publicity it has received, Eoghan Murphy has declared that it is unconstitutional and would be struck down as such in court even if it did pass into law.

Leaving aside debates over the merits, morality and messy nature of the bill itself, which would be more of a debate for the Politics forums, I'm curious as to whether my instinct on this would be correct - I don't actually know the ins and outs of the relevant constitutional articles and provisions myself, but it does strike me as strange that a minister would claim a rent freeze to be unconstitutional, while rent limits, as set forth in the Rent Pressure Zone legislation passed by his own government, is not.

How could it be that it is unconstitutional to completely freeze rents at their current level, but not to severely limit increasing them beyond their current level? And if these are indeed treated totally differently by the constitution, how is this - and how far can a government go without requiring a referendum? For example, to take a ludicrous hypothetical, if it is somehow unconstitutional to freeze rents, but not to limit them from being increased, then could the same objective be achieved by simply tweaking the RPZ legislation to limit rent increases to 0.0000000000000001% over the same period as they are current limited to the 3% increase? If not, why not? And where would the line be drawn between what counts as a constitutional limiting of increases, and an unconstitutional freezing of rents? Is there some arbitrary percentage beyond which the constitution would kick in?

It seems extremely unlikely to me, that legislation to limit rent increases would fall within the remit of the government, if legislation to outright prohibit increases would not. And even if this unlikely scenario is in fact correct, as the minister has claimed, I wonder just how severe an increase limit can be before it goes from being constitutional to unconstitutional under current rules.

Has anyone looked into this, or does anyone have any insight into how the constitution currently makes a distinction between banning rent increases (supposedly prohibited) and limiting rent increases (clearly allowed, as RPZ legislation has been in force for several years) - or is the minister, as I suspect, talking rubbish to try and dissuade the opposition from trying to pass the bill?

As I mentioned, let's leave the political debates over the merits of the bill out of this thread, I'm purely looking for opinions on the constitutionality of all this. If there is a distinction between RPZ rent controls on one hand, and outright bans on rent increases on the other, that would be fascinating to me and I'd love to know the relevant wording in the constitution which would be so specific in making a distinction between the two.

Any insights?

FishOnABike

I'd suspect the difference lies in political motivation. If it is something the government want to implement they will implement it pending any legal challenge. If it is something the government do not want to implement they will preemptively find legal grounds for not implementing it.

hatrickpatrick

FishOnABike wrote: »

I'd suspect the difference lies in political motivation. If it is something the government want to implement they will implement it pending any legal challenge. If it is something the government do not want to implement they will preemptively find legal grounds for not implementing it.

That's what I suspect as well, but on a purely constitutional level, is there a difference? Can anyone give an insight as to whether, in a hypotherical scenario where this legislation was passed, a court would allow one but not the other? (limits on increases in RPZs being one, bans on increases in RPZs being the other)

That's basically what I'm wondering. I realise that this is primarily a political war of words, I'm just interested in whether there is an actual difference in what the constitution would allow, or whether the minister is just making stuff up to try and stifle the bill and/or dampen public support for it.

It seems very unlikely to me that the constitution would treat limits on increases and bans on increases as totally separate legal issues, which is why I'm struggling to believe that one can be unconstitutional but not the other - it very much strikes me as an all or nothing deal. So either the proposed legislation is legal under the constitution, or else it and the already in place rent controls under RPZ legislation are both unconstitutional and would be found as such by a court. For rulings on these two concepts to be fundamentally different, the constitution would have to be very, very specific in what is and is not allowed - without knowing which sections are considered relevant to this discussion I can't easily read it for myself to figure out, but in general the constitution is almost never that specific and deals with far broader strokes than this.

Dublinensis

Briefly and to the best of my knowledge:

The right to own private property is protected by the Constitution.

The courts have held that legislation may interfere with constitutional rights as long as it does so in a proportionate manner.

There is also specific provision in the Constitution for private property rights to be limited by the State for the sake of the common good, but this is interpreted by the courts as subject to the general requirement that State interference with constitutional rights must be proportionate.

One could seek to argue that while existing rent controls represent a proportionate restriction on property rights, an outright rent freeze would amount to a disproportionate one.

I will leave comment as to how favourably the courts would be likely to look on such an argument to those with more experience (and/or better memories) than I.

Claw Hammer

the reality is that the current situation is at the outer limits of constitutionality.It is likely that the current situation would not stand up to a constitutional challenge but no one has brought one. the landlord representative bodies would not fiannce a challenge and the big operators were mostly letting new builds and were not affected ery much and didn't want to rock the boat given they pay little or no tax on the rents they do get.
In the initial phase it might have passed muster being of limited duration and being for a well defined social purpose. That situation is weakening by the day and a full freeze would be much more likely to bring a challenge and such a challenge would be much more likely to be successful.
In 1982 the Supreme Court said
"The effect of the rebates permitted by s. 9 is that, for a period of five years after the enactment of the Bill as law, landlords are to receive an amount which will be substantially less than the just and proper rent payable in respect of their property. In the absence of any constitutionally permitted justification, this clearly constitutes an unjust attack upon their property rights. The Bill offers no such justification for depriving the landlord of part of his or her just rent for the period specified in the Bill. This Court has already held that the pre-existing rent control constituted an unjust attack upon property rights. In such circumstances, to impose different but no less unjust deprivations upon landlords cannot but be unjust having regard to the provisions of the Constitution."

Controlling rents is a balancing exercise and going too far is unconstitutional.

In reality, the current rent control measures are "only" presumpitively constitutional. No one has taken a case.

My assumption is that they have struck just the right point on a scale where people with the motivation and resources to litigate the issue don't choose to do so because there is still enough profitability for them to choose not to do so, on a risk-reward analysis.

For small players, litigation on their own behalf is incredible unattractive. They are inherently marks for costs.

The big operators (REITs and such like) have thus far held back.

If something more restrictive is introduced, that may change.