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24 1927

AGRICULTURAL CREDIT ACT, 1927

PART III.

Chattel Mortgages.

Definitions in relation to chattel mortgages.

23. —(1) In this Act—

the expression “chattel mortgage” means an instrument under seal made between a farmer of the one part and the Corporation or a recognised bank of the other part whereby the farmer in consideration of moneys advanced to him by the mortgagee covenants with the mortgagee to repay such moneys with interest and charges in favour of the mortgagee either specific farming stock or (by way of floating charge) the farming stock from time to time on his farm or both specific farming stock and the farming stock from time to time on his farm with the repayment of the said moneys and interest;

the expression “specific chattel mortgage” means a chattel mortgage whereby a charge on specific farming stock is created; the expression “floating chattel mortgage” means a chattel mortgage whereby a floating charge on the farming stock from time to time on a farm is created;

a chattel mortgage whereby both a charge on specific farming stock and a floating charge on the farming stock from time to time on a farm are created is included in the expression “specific chattel mortgage” in so far as a charge on specific farming stock is thereby created and is included in the expression “floating chattel mortgage” in so far as such floating charge is thereby created;

the expression “farming stock” means and includes animals and birds of every kind reared or kept for profit, the produce of such animals and birds, draught animals of every kind, agricultural machinery and implements, and agricultural crops whether growing in or severed from the land;

the words “mortgagor” and “mortgagee” when used in relation to a chattel mortgage mean respectively the farmer by whom and the Corporation or recognised bank to whom such chattel mortgage is made;

the expression “recognised bank” means a bank which is for the time being appointed by the Minister to be a recognised bank for the purposes of this Part of this Act.

(2) An instrument shall not be excluded from being a chattel mortgage by reason only of one or more persons (in addition to the mortgagor and the mortgagee) being a party or parties thereto as surety or sureties only.

(3) References in this Act to farming stock in relation to a chattel mortgage shall be construed as referring only to farming stock which is the absolute property of the farmer by whom such chattel mortgage is made.

Recognised banks.

24. —The Minister may if he so thinks fit on the application of any bank appoint such bank to be a recognised bank for the purposes of this part of this Act, and whenever the Minister so appoints a bank to be a recognised bank he shall forthwith give to the Minister for Justice notice of such appointment.

Registers of chattel mortgages.

25. —(1) As soon as conveniently may be after the formation and registration of the Corporation a register of chattel mortgages shall be set up in every Circuit Court Office and shall be thenceforward there kept and maintained in accordance with this section and the regulations made thereunder.

(2) Subject to compliance with the conditions prescribed by or under this section for the registration of a chattel mortgage every chattel mortgage shall be capable of being registered within seven days and no longer after its date in the register of chattel mortgages maintained under this section in the Circuit Court Office serving the area in which the farm of the mortgagor is situate or, where such farm is situate in two or more areas served by separate Circuit Court Offices, in each of the several registers of chattel mortgages maintained under this section in the said Circuit Court Offices respectively.

(3) Any person party to a chattel mortgage (whether as mortgagor, mortgagee, or surety) or the legal representative of any such person may register such chattel mortgage within seven days and no longer after its date in any register of chattel mortgages in which such chattel mortgage is capable of being registered under this section and such mortgagee or, with the consent in writing of the mortgagee, such mortgagor or surety or his legal representative may at any time remove such chattel mortgage from any such register.

(4) Whenever the principal moneys and interest secured by a chattel mortgage are fully repaid the mortgagee shall forthwith remove such chattel mortgage from every register of chattel mortgages in which it is registered under this section.

(5) No chattel mortgage shall be of any force or effect unless or until it is duly registered in accordance with this section and the regulations made thereunder in the register or every register (as the case may be) of chattel mortgages in which it is capable of being registered under this section and a chattel mortgage so registered shall cease to be of any force or effect if and when it ceases to be duly registered in such register or every such register (as the case may be).

(6) The contents of any register of chattel mortgages maintained under this section shall not be published or disclosed nor shall any copies thereof or any part thereof be issued to any person save only and except that—

(a) any person in the employment of the Corporation and duly authorised in writing in that behalf by the Corporation may at any time inspect and take copies of any such register or any part thereof; and

(b) any person in the employment of a recognised bank and duly authorised in writing in that behalf by such bank may at any time inspect and take copies of any such register or any part thereof; and

(c) an under-sheriff may at any time inspect the register of chattel mortgages maintained in a Circuit Court Office serving the area or any part of the area for which he is the under-sheriff; and

(d) any person in the service of the State and duly authorised in writing in that behalf by the Minister or the Minister for Lands and Agriculture may at any time inspect and take copies of any such register or any part thereof; and

(e) an officer employed in a Circuit Court Office and performing duties formerly performed by the undersheriff may at any time inspect the register of chattel mortgages maintained in such Circuit Court Office; and

(f) whenever the Supreme Court or any Judge of the High Court or the Circuit Court directs that a copy of the portion of any such register relating to any particular chattel mortgage or alleged chattel mortgage be furnished to them or him, such copy shall be so furnished accordingly and such Court or Judge may disclose or publish such copy or the contents thereof to such extent and in such manner and subject to such conditions as in their or his opinion justice may require.

(7) The High Court or the Circuit Court or the Supreme Court on appeal from the High Court may at any time cause any register of chattel mortgages maintained under this section to be rectified (whether by variation, addition, or omission) in such manner as justice may require.

(8) The Minister for Justice may by order make regulations in relation to all or any of the following matters, that is to say:—

(a) the form and contents of the several registers of chattel mortgages maintained under this section;

(b) the keeping and maintenance generally of such registers;

(c) the mode of registering a chattel mortgage in such registers and the evidence to be produced for the purpose of such registration of the due execution and stamping of such chattel mortgage;

(d) with the consent of the Minister for Finance the fees to be charged and taken in respect of the registration of chattel mortgages in such registers, the removal of chattel mortgages from such registers, the inspection of such registers and any other matter relating to such registers;

(e) the general preservation of the secrecy of such registers and in particular the evidence of authority to be produced by persons claiming to inspect or take copies of such registers.

(9) The expenses of carrying this section into effect shall, to such extent as shall be sanctioned by the Minister for Finance, be paid out of moneys to be provided by the Oireachtas.

Operation and effect of specific chattel mortgage.

26. —(1) A specific chattel mortgage shall so long as it is duly registered under this Act and any moneys remain owing for principal or interest on the security thereof operate and have effect—

(a) to confer on the mortgagee the right whenever the principal moneys secured by the chattel mortgage or any part of such moneys or any payment of interest thereon is unpaid for seven days after the day appointed by the chattel mortgage for payment thereof to seize and remove from the custody of any person (other than a bona fide purchaser for value in money or money's worth without notice of the chattel mortgage) and from any place (other than land or premises belonging to such purchaser) all or any of the farming stock comprised in the chattel mortgage; and

(b) to impose on the mortgagee the obligation to sell with all convenient speed all farming stock seized and removed by him under the chattel mortgage and to apply the proceeds of such sale in or towards the discharge of the principal moneys and interest secured by the chattel mortgage and to pay the surplus (if any) of such proceeds to the mortgagor or his legal representative or assignee; and

(c) to prohibit the mortgagor from selling any farming stock comprised in the chattel mortgage without giving at least three days' previous notice in writing to the mortgagee of his intention to sell the same and from selling any of such farming stock for less than a fair and reasonable price; and

(d) to impose on the mortgagor the obligation, whenever he sells any of the farming stock comprised in the chattel mortgage, of giving forthwith to the mortgagee notice in writing of such sale with such particulars thereof as the mortgagee may require and either of paying to the mortgagee the proceeds of such sale or so much thereof as may be necessary to discharge the principal moneys and interest owing on the security of the chattel mortgage or of applying such proceeds in such other manner as may have been previously authorised by the mortgagee; and

(e) to imply a covenant on the part of the mortgagor his heirs executors and administrators with the mortgagee to pay to the mortgagee the principal moneys and interest secured by the chattel mortgage at the times and in the manner appointed by the chattel mortgage; and

(f) to impose on the mortgagor the obligation to preserve and keep safe the farming stock comprised therein and (save as may be otherwise authorised by the chattel mortgage or the mortgagee or may be necessary for any intended lawful sale) not to remove such farming stock from his farm.

(2) If and whenever the mortgagor commits a breach (whether of commission or of omission) of any provision implied in a specified chattel mortgage by virtue of this section (other than the covenant for payment of the principal moneys and interest secured by such chattel mortgage) the whole of the principal moneys secured by such chattel mortgage shall become and be forthwith payable notwithstanding anything to the contrary contained in such chattel mortgage.

Operation and effect of floating chattel mortgages.

27. —(1) A floating chattel mortgage shall, so long as it is duly registered under this Act and any moneys remain owing for principal or interest on the security thereof, and it has not become fixed as hereinafter provided, operate and have effect—

(a) to create an ambulatory and shifting charge of the principal moneys and interest secured thereby on all farming stock from time to time on the farm to which the chattel mortgage relates (hereinafter referred to as the farm); and

(b) to prohibit the mortgagor from selling any of the farming stock at any time on the farm otherwise than in the ordinary course of farming; and

(c) to impose on the mortgagor the obligation of maintaining the farming stock from time to time on the farm at a level of value equivalent (as near as may be having regard to the ordinary course of farming) to the value of the farming stock on the farm at the date of the chattel mortgage; and

(d) whenever the mortgagor sells any of the farming stock for the time being on the farm to impose on him the obligation of paying such (if any) part of the proceeds of such sale as the mortgagee shall require to the mortgagee in reduction or discharge of the principal moneys secured by the chattel mortgage and any interest due thereon and to confer on the mortgagor the right to pay the whole or any part of such proceeds of sale to the mortgagee in reduction or discharge of such principal moneys and interest.

(2) Whenever the principal moneys secured by a floating chattel mortgage or any part of such moneys remain unpaid for one month after the date appointed by the chattel mortgage for payment thereof or some interest secured by a floating chattel mortgage is in arrear and unpaid for two months after becoming due or there has been a breach (whether of commission or omission) by the mortgagor of some provision contained in a floating chattel mortgage or implied therein by virtue of this section (other than a covenant for payment of the principal moneys or interest secured thereby), the mortgagee may serve on the mortgagor a notice in writing declaring that such floating chattel mortgage has become fixed and thereupon such floating chattel mortgage shall become and be fixed within the meaning of this section.

(3) When a floating chattel mortgage has become fixed such chattel mortgage shall thenceforward operate and have effect as a specific chattel mortgage of all farming stock which is on the farm at the time of the service of the notice declaring such chattel mortgage to have become fixed and the provisions of this Act in relation to the operation and effect of a specific chattel mortgage shall apply accordingly.

(4) A floating chattel mortgage shall so long as it is duly registered under this Act operate and have effect to imply a covenant on the part of the mortgagor, his heirs, executors, and administrators with the mortgagee to pay to the mortgagee the principal moneys and interest secured by the chattel mortgage at the times and in the manner appointed by the chattel mortgage.

Priorities of chattel mortgages.

28. —(1) Chattel mortgages shall have priority in accordance with the times at which they are respectively registered or first registered (as the case may be) under this Act.

(2) A specific chattel mortgage of any farming stock which is at the date of such chattel mortgage on a farm to which a prior floating chattel mortgage then applies shall be void and of no effect so long but so long only as any principal moneys or interest remain owing on the security of such floating chattel mortgage.

(3) A bill of sale made before the passing of this Act shall if and so long as it continues to be valid and enforceable under the Bills of Sale Acts, 1879 and 1883 have priority over a chattel mortgage.

(4) Farming stock comprised in a specific chattel mortgage or in a floating chattel mortgage which has become fixed shall not be deemed to be in the possession, order or disposition of the mortgagor within the meaning of the Irish Bankrupt and Insolvent Act, 1857 or any Act altering or amending that Act.

Disclosure of chattel mortgage to creditor.

29. —(1) It shall be an obligation on every person (hereinafter called the debtor) who seeks from another person (hereinafter called the creditor) the grant or continuance of credit to disclose in writing to the creditor (if required in writing by the creditor so to do) whether there is or is not a chattel mortgage subsisting in respect of any of the debtor's farming stock and the particulars of every (if any) such chattel mortgage.

(2) No creditor shall disclose any information furnished to him by the debtor in pursuance of this section save in so far as such disclosure may be necessary or proper for the purposes of a prosecution under this section or for the institution or conduct of legal proceedings for the recovery of moneys due by the debtor to the creditor.

(3) Every person who shall make in writing a statement in pursuance of this section which is to his knowledge false or misleading in any material respect and every person who shall in contravention of this section disclose any information furnished to him in pursuance of this section shall be guilty of an offence under this section and shall be liable on summary conviction thereof to a penalty not exceeding twenty pounds.

Statement of existing indebtedness by intending mortgagor.

30. —(1) Whenever a farmer (hereinafter referred to as the intending mortgagor) agrees to make and the Corporation or a recognised bank (hereinafter referred to as the intending mortgagee) agrees to take a chattel mortgage (hereinafter referred to as the proposed chattel mortgage) the intending mortgagor shall furnish to the intending mortgagee a statement in writing stating whether he is or is not then indebted to the Corporation or any recognised bank (hereinafter referred to as the existing creditor) and, if he is so indebted, the name of the existing creditor.

(2) If in such statement the intending mortgagor states that he is so indebted the intending mortgagee shall send by post to the existing creditor a notice in writing stating the intention of the intending mortgagee to take a chattel mortgage from the intending mortgagor, and if either the intending mortgagee fails so to send such notice or the proposed chattel mortgage is made within seven days after the day on which such notice is so sent the proposed chattel mortgage shall be deemed to be fraudulent and void as against the existing creditor.

(3) If a chattel mortgage is made without such statement being furnished by the intending mortgagor to the intending mortgagee and the mortgagor was at the date of such chattel mortgage indebted to the Corporation or a recognised bank such chattel mortgage shall if the intending mortgagor was so indebted to the Corporation and the Corporation is not the mortgagee be deemed to be fraudulent and void as against the Corporation and shall if the intending mortgagor was so indebted to any recognised bank be deemed to be fraudulent and void as against every recognised bank (other than the mortgagee) to which the intending mortgagor was so indebted.

(4) Every person who shall make a statement in writing in pursuance of this section which is to his knowledge false or misleading in any material respect shall be guilty of a misdemeanour and be liable on conviction thereof to a fine not exceeding two hundred pounds, or at the discretion of the court, to penal servitude for three years or imprisonment for any term not exceeding two years.

Effect of chattel mortgages in relation to execution orders.

31. —(1) A chattel mortgage shall not prevent or restrict the lawful seizure of any farming stock comprised therein or affected thereby by a landlord distraining for rent or a duly authorised officer distraining or levying under the Income Tax Acts or a rate collector distraining for rates or the lawful seizure and sale of any such farming stock under an execution order issued for the enforcement of a judgment or order for the payment of moneys due or payable to or for the benefit of the Central Fund or the repayment of advances made out of moneys provided by the Oireachtas or the interest on such advances or of moneys due or payable to the Irish Land Commission under the Land Purchase Acts or to a rate collector in respect of rates levied by the council of a county, a county or other borough, or an urban district or the commissioners of a town, or to a landlord in respect of rent.

(2) Save as is provided in the foregoing sub-section no farming stock comprised in or affected by a chattel mortgage shall be seized or sold under an execution order, unless before such seizure the creditor has paid to the under-sheriff or county registrar executing such execution order the full amount of the principal moneys and interest then owing and unpaid on the security of such chattel mortgage.

(3) Whenever a creditor pays under the foregoing sub-section to an under-sheriff or county registrar the full amount owing on the security of a chattel mortgage, the following provisions shall have effect, that is to say:—

(a) the under-sheriff or county registrar shall pay such amount to the mortgagee and the mortgagee shall accept such amount in discharge of the moneys secured by such chattel mortgage notwithstanding anything to the contrary contained in such chattel mortgage and in particular notwithstanding that such moneys are not then due or payable, and

(b) the said amount shall be added to the debt for which execution is leviable under the execution order, and such execution order shall have effect accordingly.

(4) For the purpose of enabling the creditor to take advantage of the provisions of sub-sections (2) and (3) of this section, the following provisions shall have effect, that is to say:—

(a) whenever a creditor requires an execution order to be executed against any farming stock the under-sheriff or county registrar shall inspect the appropriate register of chattel mortgages and if on such inspection such farming stock is found to be comprised in or affected by a chattel mortgage such under-sheriff or county registrar shall inform the creditor of the existence of such chattel mortgage the date thereof and the name and address of the mortgagee, and

(b) the mortgagee shall on demand made by the creditor furnish to the creditor a statement of the full amount of the principal moneys and interest then owing and unpaid on the security of the chattel mortgage.

(5) In this section the expression “execution order” has the same meaning as it has in the Enforcement of Court Orders Act, 1926 (No. 18 of 1926) and the word “creditor” means the person at whose instance an execution order is issued.

Avoidance of bills of sale on farming stock.

32. —Every bill of sale of farming stock (whether including or not including any other chattels) made after the passing of this Act shall, notwithstanding anything contained in the Bills of Sale Acts, 1879 and 1883, be void and of no effect and be incapable of being registered under those Acts.