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C.C.S.M. c. C301
The Credit Unions and Caisses Populaires Act
| Table of Contents | Regulations |
(Assented to September 10, 1986)
HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:
PART I
INTERPRETATION AND APPLICATION
1(1) In this Act,
"affairs" means the relationship among a credit union or a central, their subsidiaries and their respective members, directors and officers, but does not include the business carried on by the credit union, central, or subsidiary; (« affaires internes »)
"articles" means the original or restated articles of incorporation, articles of amendment, articles of amalgamation, articles of reorganization, articles of dissolution, articles of revival and any amendments thereto; and includes any Act, statute or ordinance by or under which a body corporate has been incorporated, and any letters patent, supplementary letters patent, certificate of incorporation, memorandum of association, and any other document evidencing corporate existence; (« statuts »)
"associate" means a person, other than a member, who has rights under the by-laws of a credit union or central or the Act, in a credit union or central; (« associé »)
"auditor" includes a partnership of auditors; (« vérificateur »)
"board of directors" means the directors as a body; (« conseil d'administration »)
"body corporate" includes a credit union or other body corporate wheresoever or howsoever incorporated; (« personne morale »)
"bond of association" includes groups having a common bond of occupation or association, the residents within a well defined neighbourhood, community or rural or urban district, including a rural trading area, employees of a common employer or members of bona fide fraternal, religious, cooperative, labour, rural, educational and similar organizations, and members of the immediate family of such persons; (« lien d'association »)
"CCSM" means Co-operative Credit Society of Manitoba Limited; (« CCSM »)
"CUCM" means Credit Union Central of Manitoba Limited; (« CUCM »)
"capital account" means the full amount of the consideration received by a credit union or central for any shares issued; (« compte de capital »)
"central" means CUCM or Fédération; (« centrale »)
"charter by-law" means a by-law of a central that requires the approval of the Registrar; (« règlement constitutif »)
"common-law partner" of a person means a person, who not being married to the other person is cohabiting with him or her in a conjugal relationship of some permanence; (« conjoint de fait »)
"court" means the Court of Queen's Bench; (« tribunal »)
"creditor" means a person, other than a depositor, to whom a credit union or central owes money and includes, as the context requires, the creditor's heirs, executors, administrators and assigns; (« créancier »)
"debt obligation" means a bond, debenture, note or other evidence of indebtedness or guarantee of a body corporate, whether secured or unsecured; (« titre de créance »)
"delegate" means an individual elected, in accordance with the by-laws, to represent a group of members at meetings of a credit union or central; (« délégué »)
"deposit" means money placed in an account in a credit union or central; (« dépôt »)
"director" means an individual who occupies the position of director, by whatever name called, of a credit union or central; (« administrateur »)
"Fédération" means La Fédération des Caisses Populaires du Manitoba Inc.; (« Fédération »)
"guarantee corporation" means The Credit Union Deposit Guarantee Corporation or the Société d'assurance-dépôts des caisses populaires, as the context may require; (« compagnie de garantie »)
"guarantee fund" means those moneys collected and administered by a guarantee corporation for the purpose of protecting deposits in a credit union; (« fonds de garantie »)
"immediate family" means the spouse, common-law partner, son, daughter, brother, sister, parent, or grandparent of an individual; (« famille immédiate »)
"incorporator" means a person who signs articles of incorporation; (« fondateur »)
"individual" means a natural person; (« particulier »)
"member" means a person having rights through a membership interest in a credit union or central in accordance with the provisions of this Act and the articles or by-laws of the credit union or central and includes, as the context may require, a member's legal representative, an associate of a credit union and an associate member of a central; (« membre »)
"minister" means the member of the executive council charged by the Lieutenant Governor in Council with the administration of this Act; (« ministre »)
"officer" includes the president, vice-president and secretary of a credit union, central or guarantee corporation; (« dirigeant »)
"ordinary resolution" means a resolution passed by a majority of the votes cast by members or delegates who voted in respect of that resolution; (« résolution ordinaire »)
"patronage refund" means an amount that under this Act is allocated among and credited or paid by a credit union or central to its members or associates, based upon the business done by each of them with or through the credit union or central; (« ristourne »)
"person" includes an individual, partnership, association, body corporate, trustee, executor, administrator and legal representative; (« personne »)
"prescribed" means prescribed by the regulations; (« prescrit »)
"Registrar" means the Registrar appointed under section 226; (« registraire »)
"resident in Manitoba", in relation to a person, means that the person is legally entitled to be in Canada, makes his or her home in Manitoba, and is physically present in Manitoba for at least six months in the year; (« résident du Manitoba »)
"security" means a share or a debt obligation or a certificate evidencing a share or debt obligation; (« valeur mobilière »)
"security interest" means an interest in or charge upon property of a credit union, central or guarantee corporation taken by a creditor to secure payment of a debt or performance of any other obligation of the credit union, central or guarantee corporation, and includes a certificate evidencing a share or debt obligation; (« sûreté »)
"send" includes deliver; (English version only)
"special resolution" means a resolution passed by a majority of not less than 2/3 of the votes cast by the persons who voted in respect of that resolution, or signed by all the persons entitled to vote on that resolution; (« résolution spéciale »)
"subsidiary" means a body corporate in which a credit union or central has a majority of the voting shares; (« filiale »)
"system" means
(a) CUCM and The Credit Union Deposit Guarantee Corporation, and the credit unions assigned to them, or
(b) Fédération and the Société d'assurance-dépôts des caisses populaires, and the caisses populaires assigned to them,
as the context may require. (« système »)
1(2) For the purposes of this Act and the regulations,
(a) a reference in the English version to a credit union includes, unless the context otherwise requires, a caisse populaire; and
(b) a reference in the French version to a caisse populaire includes, unless the context otherwise requires, a credit union.
Registered common-law relationship
1(3) For the purposes of this Act, while they are cohabiting, persons who have registered their common-law relationship under section 13.1 of The Vital Statistics Act are deemed to be cohabiting in a conjugal relationship of some permanence.
S.M. 1994, c. 20, s. 4; S.M. 1996, c. 28, s. 2; S.M. 2002, c. 24, s. 16; S.M. 2002, c. 48, s. 28; S.M. 2004, c. 29, s. 2.
Purpose of credit unions generally
2(1) The purposes of credit unions are, on a cooperative basis, to provide a comprehensive range of financial services primarily for their members and to provide for the direction and democratic control of such services primarily by residents of Manitoba.
Purpose of caisses populaires generally
2(2) The purposes of caisses populaires are, on a cooperative basis, to provide a comprehensive range of financial services in the French language primarily for their members and to provide for the direction and democratic control of such services by French-speaking individuals who, except as otherwise permitted by this Act, are resident in Manitoba.
3(1) This Act, except where it is otherwise expressly provided, applies to
(a) every credit union incorporated under this Act;
(b) every credit union heretofore incorporated under similar legislation of the province in force before the coming into force of this Act;
(c) every central continued under this Act; and
(d) every guarantee corporation.
3(2) Where a provision of Part XI or XII is inconsistent with any other provision of this Act, the provision of that Part prevails.
Objects of existing credit unions
4(1) Where before the coming into force of this Act the words "and capable forthwith of exercising all the functions of a credit union, with powers and privileges and subject to the provisions and restrictions applicable thereto set forth in The Credit Unions Act, for the objects following, that is to say:" or words of like effect are contained in the articles of a credit union, those words are deemed to be struck out and the words "and capable forthwith of exercising all the functions of a credit union, subject to the provisions and restrictions applicable thereto, and the business of the credit union is restricted to the following:" are deemed to be substituted therefor.
Powers of existing credit unions
4(2) Where the articles of a credit union excluded, immediately before the coming into force of this Act, any of the powers authorized by any former Act by or under which the credit union was incorporated, the articles are deemed to restrict the credit union from exercising the powers so excluded.
PART II
CREDIT UNIONS INCORPORATION
Incorporation of a credit union
5(1) Ten or more adults, none of whom is an undischarged bankrupt, may apply to incorporate a credit union by sending the Registrar two copies of articles of incorporation and of a notice of registered office. The articles and notice must be in the form approved by the Registrar.
5(2) The Registrar shall assist persons desirous of applying for incorporation under this Act, and shall prepare and make available model forms of articles for the use of credit unions.
S.M. 1996, c. 28, s. 4; S.M. 2004, c. 29, s. 4.
6(1) Articles of incorporation for a proposed credit union shall state
(a) the name of the credit union;
(b) the location in Manitoba where the registered office is to be situated;
(c) the name in full and the residence address, giving the street and number if any, of each first director;
(d) a statement of the proposed bond of association of the credit union, if any;
(e) the classes and any maximum number of shares that the credit union is authorized to issue other than common shares, if any, and if there will be two or more classes of shares, the rights, privileges, restrictions and conditions attaching to each class of shares;
(f) if the right to transfer shares of the credit union is to be restricted, a statement that the right to transfer shares is restricted and the nature of the restrictions;
(g) any restrictions on the business that the credit union may carry on;
(h) a statement indicating whether associate status is permitted; and
(i) all other matters which by this Act are required to be dealt with in the articles.
Additional provisions of articles
6(2) The articles may in addition set out any provisions permitted by this Act to be set out in the by-laws.
6(3) The articles shall have attached thereto, in the prescribed form, the consent of a first director who is not an incorporator.
6(4) The by-laws shall provide for such of the following matters as are applicable but are not set out in the articles:
(a) qualifications, conditions and method of applying for and terminating membership and associate status;
(b) the location of meetings of members, mode of holding meetings and quorum at meetings;
(b.1) members' rights to make, repeal and amend by-laws;
(b.2) members' voting rights, including, but not limited to, the right to vote by ballot or another method, or by a combination of methods;
(b.3) the manner, form and effect of votes at members' meetings;
(c) the election, term of office, removal of and filling of vacancies among directors, committee members and officers; their powers, duties and remuneration; and the procedure and quorum at meetings of the board of directors;
(d) the division of the territory in which the credit union carries on its business into districts for the purpose of holding district meetings, the business that may be conducted and the procedures to be followed at the meetings;
(e) the establishment of the fiscal year-end of the credit union which shall be on the last day of March, June, September or December in each year;
(f) repealed, S.M. 1996, c. 28, s. 5;
(g) the holding of a referendum on any matter of general concern to the members; and
(h) all other matters which, by this Act, are required to be dealt with in the by-laws.
S.M. 1996, c. 28, s. 5; S.M. 2004, c. 29, s. 5.
7 The Registrar may accept for filing and approval any articles sent under section 5 with respect to a proposed incorporation if
(a) the Registrar is satisfied that the incorporation is advisable and, without limiting the generality of the foregoing,
(i) the subscribers and proposed directors are residents of Manitoba and are qualified under this Act to establish and operate a credit union,
(ii) the proposed credit union will be organized and operated for the convenience and advantage of its members,
(iii) the proposed credit union will be organized and operated in a manner whereby the investments and deposits of members will be safeguarded without likelihood of claim upon the guarantee corporation, and
(iv) the proposed bond of association, if any, is not objectionable, and
(b) the articles are in compliance with the provisions of this Act;
(c) repealed, S.M. 1996, c. 28, s. 6.
8 Upon acceptance for filing and approval of the articles, the Registrar shall issue a certificate of incorporation in accordance with section 228.
9 A credit union comes into existence on the date shown in the certificate of incorporation.
10(1) Every credit union that is a member of the CUCM and assigned to The Credit Union Deposit Guarantee Corporation shall have the words "credit union" as part of its name and the word "limited" or abbreviation "ltd." as the last word of the name.
10(2) Every caisse populaire that is a member of the Fédération and assigned to the Société d'assurance-dépôts des caisses populaires shall have the words "caisse populaire" as part of its name and the word "limitée" or abbreviation "ltée" as the last word of the name.
10(3) Subject to subsections (1) and (2), and section 12, a credit union may set out its name in its articles in any language form and may be legally designated by that form.
10(4) A credit union shall clearly identify itself and set out its name in legible characters in all contracts, invoices, negotiable instruments, orders for goods and services, advertising and all other representations to the public.
10(5) Subject to section 12 and The Business Names Registration Act,
(a) a credit union may carry on business under or identify itself by a name other than its full legal name as long as the other name includes "credit union" or "CU"; and
(b) a caisse populaire may carry on business under or identify itself by a name other than its full legal name as long as the other name includes "caisse populaire" or "caisse".
Prohibited use of credit union designations
10(6) No person other than a credit union shall use the words "credit union" or any derivative or abbreviation thereof as part of its name, or shall hold itself out as, or use part of its name or otherwise any word or abbreviation suggesting, indicating or implying that it is, or is carrying on business as, a credit union.
Prohibited use of caisse populaire designation
10(7) No person other than a caisse populaire shall use the words "caisse populaire" or any derivative or abbreviation thereof as part of its name, or shall hold itself out as, or use part of its name or otherwise any word or abbreviation suggesting, indicating or implying that it is, or is carrying on business as, a caisse populaire.
10(8) Subsections (6) and (7) do not apply to
(a) a body corporate incorporated by or under the authority of an Act of the Parliament of Canada; or
(b) a credit union incorporated pursuant to the laws of any other province and which is authorized under this Act to carry on business in Manitoba; and
(c) any guarantee corporation or central to which this Act applies.
Registrar may permit use of prohibited name
10(9) Despite subsections (6) and (7), the Registrar may, on request, permit an association, body corporate or partnership to use as part of its name the words "credit union" or "caisse populaire" or a derivative or abbreviation of either of them.
S.M. 1987-88, c. 66. s. 6; S.M. 1994, c. 20, s. 4; S.M. 1996, c. 28, s. 8; S.M. 2004, c. 29, s. 6.
11 The Registrar may, upon the request in writing of any person and upon payment of the prescribed fee, reserve a name for the use and benefit of the persons desiring to form a credit union for a period of 90 days if the name is not contrary to section 12.
12(1) A credit union shall not have a name
(a) that is known to the Registrar to be identical with the name of an existing or a dissolved credit union except as prescribed;
(b) that, subject to subsection (2), is known to the Registrar to be the same as the name of a business or association or other body corporate;
(c) that suggests or implies a connection with the Crown or any member of the Royal Family, or the Government of Canada, or the government of any province in Canada or any department, branch, bureau, service, agency or activity of that government, without the consent in writing of the appropriate authority; or
(d) that includes the word "Loan" or "Trust"; or
(e) that the Registrar, for any good and valid reason disapproves.
Name not to be similar to business, etc.
12(2) A credit union shall not have a name that is similar to the name of any other business, association or body corporate if the use of that name by the credit union would, in the opinion of the Registrar, be likely to confuse or mislead, unless the business, association or body corporate consents in writing to its name being given in whole or in part to the credit union, and if required by the Registrar, the business, association or body corporate undertakes to dissolve or to change its name within 6 months after the incorporation of the credit union.
12(3) Where a credit union is granted a name subject to an undertaking given under subsection (2) and the undertaking is not carried out within the specified time, the Registrar may direct the credit union to which the name is granted to change its name to a name that complies with this Act; and if the credit union fails to comply with the directive within 60 days of the service thereof, the Registrar may revoke the name of the credit union and assign to it a number and, until changed in accordance with section 114, the name of the credit union is the number so assigned.
12(4) Where a credit union
(a) comes into existence or is continued with a name; or
(b) upon an application to change its name, is granted a name;
that contravenes this section, the Registrar may direct that credit union to change its name.
12(5) Where a credit union is directed under subsection (4) to change its name and fails within 60 days from the service of the directive to change its name to a name that complies with this Act, the Registrar may revoke the name of the credit union and assign to it a number and, until changed in accordance with section 114, the name of the credit union is the number so assigned.
12(6) Where a credit union has had its name revoked and a number assigned to it under subsection (3) or (5), the Registrar shall issue a certificate of amendment showing the new name of the credit union and shall forthwith give notice of such change of name in the Manitoba Gazette.
Personal liability under pre-incorporation contracts
13(1) Except as provided in this section, a person who enters into a written contract in the name of or on behalf of a credit union before it comes into existence is personally bound by the contract and is entitled to the benefits thereof.
Adoption of pre-incorporation contracts
13(2) A credit union may, within a reasonable time after it comes into existence, by any action or conduct signifying its intention to be bound thereby, adopt a written contract made before it came into existence in its name or on its behalf, and upon the adoption
(a) the credit union is bound by the contract and is entitled to the benefits thereof as if the credit union had been in existence at the date of the contract and had been a party thereto; and
(b) the person who purported to act in the name of or on behalf of the credit union ceases, except as provided in subsection (3), to be bound by or entitled to the benefits of the contract.
13(3) Except as provided in subsection (4), whether or not a written contract made before the coming into existence of a credit union is adopted by the credit union, a party to the contract may apply to the court for an order fixing obligations under the contract as joint and several or apportioning liability between or among the credit union and any person who purported to act in the name of or on behalf of the credit union, and upon the application the court may make any order it thinks fit.
Exemption from personal liability
13(4) If expressly so provided in the written contract, a person who purported to act in the name of or on behalf of the credit union before it came into existence is not in any event bound by the contract or entitled to the benefits thereof.
PART III
CAPACITY AND POWERS
14(1) A credit union has the capacity and, subject to this Act, the rights, powers and privileges of a natural person.
14(2) Subject to the approval of the Registrar, a credit union has the capacity to carry on its business, conduct its affairs and exercise its powers in any jurisdiction outside Manitoba to the extent that the laws of that jurisdiction permit.
15(1) Subject to this Act, it is not necessary for a by-law to be passed in order to confer any particular power on a credit union or its directors.
15(2) A credit union shall not carry on any business or exercise any power if it is restricted by its articles from carrying on that business or exercising that power, nor shall the credit union exercise any of its powers in a manner contrary to its articles.
15(3) No act of a credit union, including any transfer of property to or by a credit union, is invalid by reason only that the act or transfer is contrary to its articles or this Act.
16(1) Subject to subsection (2), no person is affected by or is deemed to have notice or knowledge of the contents of a document concerning a credit union by reason only that the document has been filed with the Registrar or is available for inspection at an office of the credit union.
Constructive notice of articles or by-laws
16(2) A member of a credit union is deemed to have notice and knowledge of the contents of the articles and by-laws of the credit union.
Reliance by persons dealing with credit union
17 A credit union or a guarantor of an obligation of the credit union may not assert against a person dealing with the credit union or with any person who has acquired rights from the credit union that
(a) the articles or by-laws have not been complied with; or
(b) the persons named in the most recent notice sent to the Registrar under this Act are not the directors of the credit union; or
(c) the place named in the most recent notice sent to the Registrar under this Act is not the registered office of the credit union; or
(d) a person held out by the credit union as a director and officer or agent of the credit union has not been duly appointed or has no authority to exercise the powers or perform the duties that are customary in the business of the credit union or usual for that director, officer or agent; or
(e) a document issued by any director, officer or agent of the credit union with actual or usual authority to issue the document is not valid or not genuine; or
(f) any financial assistance to members or directors or any sale, lease or exchange of all or substantially all of the property of the credit union was not authorized;
except where the person has or ought to have, by virtue of that person's position with or relation to the credit union, knowledge to the contrary.
PART IV
REGISTERED OFFICE AND RECORDS
18(1) A credit union shall have its registered office in Manitoba. The registered office shall be at the location specified in its articles.
18(2) A credit union may change the address or location of its registered office within Manitoba as prescribed.
18(3) Repealed, S.M. 1996, c. 28, s. 11.
Annexation or amalgamation of municipalities
18(4) Where the location of the registered office of a credit union is changed by reason only of the annexation or amalgamation of the location in which the registered office is situate to or with another municipality, that change does not constitute and is not deemed to constitute a change within the meaning of subsection (2).
18(5) A credit union may establish or relocate branch offices of the credit union as may be prescribed.
S.M. 1996, c. 28, s. 11; S.M. 2004, c. 29, s. 7.
19(1) A credit union shall prepare and maintain, at its registered office or subject to subsection (2) at any other place in Manitoba designated by the directors, records including
(a) the articles and the by-laws and all amendments thereto;
(b) the duly executed minutes of meetings and resolutions of members;
(c) a register of directors, officers and committee members setting out the names, addresses and other occupations, if any, of all persons who are or have been directors, officers or committee members of the credit union with the several dates on which each became or ceased to be a director, officer or committee member;
(d) a members register, and if applicable, an associates register, setting out the names and the latest known addresses of all members and associates;
(e) a shareholders register of holders of shares of a class other than common or surplus shares, setting out the names and the latest known addresses of the shareholders and the number of shares and other securities, if any, held by each;
(f) the accounting records and the duly executed minutes of meetings and resolutions of the directors and any committee thereof.
19(2) Where a credit union, to the satisfaction of the Registrar,
(a) shows, the necessity of keeping any of the minutes, documents, registers, books of account and accounting records mentioned in subsection (1) at a place other than the registered office of the credit union; and
(b) gives assurance that those minutes, documents, registers, books of account and accounting records will at all reasonable times be open for inspection, at the registered office of the credit union or some other place in Manitoba approved by the Registrar, by any person who is entitled to inspect them and who applies to the credit union for an inspection thereof;
the Registrar may, by order, which may be subject to terms, permit the credit union to keep them at a place designated in the order other than the registered office.
19(3) The Registrar for any good and valid reason may, by order which may be subject to terms, vary or rescind any order made under subsection (2).
Examination of records by members and creditors
20(1) Members and creditors of a credit union, their agents and legal representatives, may examine the records referred to in clauses 19(1)(a), (b) and (c) during the usual business hours of the credit union, and may take extracts therefrom upon payment of a reasonable fee.
20(2) Where the affidavit referred to in subsection (4) is sent to the credit union, members of a credit union, their agents and legal representatives may examine the records referred to in clause 19(1)(d) during the usual business hours of the credit union and may, upon payment of a reasonable fee, receive from the credit union a copy of the members register.
20(3) Where the affidavit referred to in subsection (4) is sent to the credit union, holders of shares of a class other than common or surplus shares, their agents and legal representatives may examine the records referred to in clause 19(1)(e) during the usual business hours of the credit union and may, upon payment of a reasonable fee, receive from the credit union a copy of the shareholders register.
20(4) The affidavit required pursuant to subsection (2) or (3) shall
(a) state the name and address of the applicant;
(b) be made by a director or officer of the body corporate if the applicant is a body corporate; and
(c) state that the register will not be used by any person except in connection with matters relating to the affairs of the credit union.
20(5) A person who uses a register for purposes not related to the affairs of the credit union is guilty of an offence and liable on summary conviction to a fine not exceeding $5,000. or to imprisonment for a term not exceeding 6 months or to both.
Examination of members register at meetings
20(6) A credit union shall make available, and a member may examine, the members register at any meeting of members.
Directors right to examine records
20(7) The directors of a credit union or the duly authorized representative of the board of directors may examine the records referred to in clause 19(1)(f) at all reasonable times at no charge.
Registrar's right to examine records
20(8) The Registrar shall have the right to inspect the records referred to in subsection 19(1) at all reasonable times.
21(1) All registers and other records required by this Act to be prepared and maintained may be in a bound or loose-leaf form or in a photographic film form, or may be entered or recorded by any system of mechanical or electronic data processing or any other information storage device that is capable of reproducing any required information in intelligible written form within a reasonable time.
21(2) A credit union and its agents shall take reasonable precautions to
(a) prevent loss or destruction of;
(b) prevent falsification of entries in;
(c) facilitate detection and correction of inaccuracies in;
the registers and other records required by this Act to be prepared and maintained.
22 An instrument or agreement executed on behalf of a credit union by a director, an officer or an agent of the credit union is not invalid merely because a corporate seal is not affixed thereto.
PART V
CAPITALIZATION AND OPERATING STANDARDS
23(1) Common shares in a credit union shall have an issue price fixed by the articles, but the issue price shall not, in any event, be less than $5. each.
23(2) A credit union is not limited as to the number of common shares it may issue.
23(3) A member of a credit union shall purchase at least one fully paid common share.
24 Where a credit union is incorporated prior to the commencement of this Act, an issued share of the credit union is deemed, for purposes of this Act, to be a common share.
Shares other than common shares
25(1) In addition to common shares, the articles of a credit union may provide for the issuance of more than one class of shares, including surplus shares, and if the articles so provide, there shall be set out therein the maximum number of shares in each class other than common and surplus shares that the credit union is entitled to issue, the total consideration to be paid for each such class of shares, and the rights, privileges, restrictions, conditions, including dividends, attached to the shares of each such class.
25(2) Common shares shall rank behind all other classes of shares issued by the credit union and holders of common shares shall not, upon the winding-up or liquidation of a credit union, be entitled to redeem in whole or in part, any common shares until the amounts outstanding on all other classes of shares have been paid in full.
25(3) The Registrar may not permit a credit union to create a class of shares, other than common shares, if, in the opinion of the Registrar, the issuance of such shares would
(a) not be consistent with the objects of a credit union generally; or
(b) not be in the financial interests of the credit union; or
(c) increase the risk of a claim upon the guarantee corporation.
26(1) A credit union is not required to issue share certificates for common or surplus shares.
26(2) Repealed, S.M. 1996, c. 28, s. 14.
27(1) A share shall not be issued until the consideration for the share is fully paid in money, or in property or past services that is not less in value than the fair equivalent of the money that the credit union would have received if the share had been issued for money.
Promissory note not consideration
27(2) A credit union shall not issue a share if the proposed consideration for such share consists, in whole or in part, of a promissory note or a promise to pay.
28(1) A credit union's board of directors may allocate some or all of any surplus arising from the credit union's operations in a fiscal year as a patronage refund among its members, after
(a) providing for all known liabilities;
(b) allowing for doubtful accounts;
(c) making such other provisions as are required by this Act and the regulations; and
(d) providing for payment of dividends, if any, on all classes of shares.
Member's share of patronage refund
28(1.1) Each member shall be entitled to a share of a patronage refund allocated to members proportionate to the business he or she does with or through the credit union in the fiscal year, as computed by the directors at a rate they fix by resolution.
28(2) The directors shall compute the amount of the business done by a member with a credit union in a fiscal year in relation to the services rendered
(a) by the credit union on behalf of or to the member; or
(b) by the member on behalf of or to the credit union;
with appropriate differences for the different classes, grades or qualities of the services.
Members' and associates' rates
28(3) The rate that the directors fix for calculation of a member's share of a patronage refund must be equal to or greater than the rate fixed for associates.
S.M. 1996, c. 28, s. 15; S.M. 2004, c. 29, s. 8.
Use of patronage refund or dividend to purchase surplus shares
29(1) A credit union may provide in its by-laws that, in a fiscal year, part or all of a patronage refund or common or surplus share dividend credited to a member shall be applied to purchase surplus shares of the credit union for the member, up to the maximum number specified in the by-laws.
29(2) and (3) Repealed, S.M. 1996, c. 28, s. 16.
S.M. 1996, c. 28, s. 16; S.M. 2004, c. 29, s. 9.
30(1) A credit union shall not make any payment to purchase or redeem shares issued by it if there are reasonable grounds for believing that
(a) the credit union is, or would thereby be, unable to pay its liabilities as they become due; or
(b) the realizable value of the credit union's assets is, or would thereby be, less than the aggregate of
(i) its liabilities, and
(ii) the amount that would, at that time, be required to pay the holders of equity, that have a right to be paid, on a redemption, repayment or in a liquidation, rateably with or prior to the holders of the equity to be purchased, redeemed or repaid.
30(2) Subject to subsection (1), no shares issued by a credit union may be redeemed or purchased at a price exceeding the issue price.
Dividends on common or surplus shares
31 Subject to subsection 32(1), a credit union may declare and pay such dividends upon its outstanding common or surplus shares as may be established by a resolution of the directors.
32(1) A credit union shall not pay out a dividend on shares or pay out a patronage refund, if there are reasonable grounds for believing that
(a) the credit union is, or would thereby be, unable to pay its liabilities as they become due; or
(b) the realizable value of the credit union's assets is, or would thereby be, less than the aggregate of its liabilities and its capital other than retained surplus; or
(c) the capital of the credit union is, or would thereby be, less than the prescribed amount.
32(2) If, but for clause (1)(c), a credit union would be able to make any payments referred to in subsection (1), the guarantee corporation may authorize any payments referred to in that subsection on such terms and conditions as it considers appropriate.
Limitation on holding of shares
33 Unless the by-laws of a credit union otherwise provide, no person shall hold more than 10% of the total number of issued shares of any class of the credit union's capital stock.
34 Repealed.
35(1) All shares in a credit union shall be non-voting except in the case of a class vote as provided for in subsection (2).
35(2) The holders of shares of a class other than common or surplus shares are, unless the articles otherwise provide in the case of an amendment referred to in clauses (a), (b), and (e), entitled to vote separately as a class upon a proposal to amend the articles to
(a) increase or decrease any maximum number of authorized shares of the class, or increase any maximum number of authorized shares of any other class having rights or privileges equal or superior to the shares of that class; or
(b) effect an exchange, reclassification or cancellation of all or part of the shares of the class; or
(c) add, change or remove the rights, privileges, restrictions or conditions attached to the shares of the class and, without limiting the generality of the foregoing,
(i) remove or change prejudicially any rights to accrued dividends or rights to cumulative dividends, or
(ii) add, remove or change prejudicially any redemption rights, or
(iii) reduce or remove any dividend preference or liquidation preference, or
(iv) add, remove or change prejudicially any conversion privileges, options, voting, transfer or pre-emptive rights, or rights to acquire securities of a corporation, or sinking fund provisions; or
(d) increase the rights or privileges of any other class of shares having rights or privileges equal or superior to the shares of that class; or
(e) create a new class of shares equal or superior to the shares of that class; or
(f) make any class of shares having rights or privileges inferior to the shares of that class equal or superior to the shares of that class; or
(g) effect an exchange or create a right of exchange of all or part of the shares of another class into the shares of that class; or
(h) constrain the issue or transfer of the shares of the class or extend or remove the constraint.
36 Subject to this Act, a member is not responsible for any act, default or liability whatsoever of the credit union or for any engagement, claim, payment, loss, injury, transaction, matter or thing whatsoever relating to or connected with the credit union.
37 Nothing in this Act curtails, abridges or defeats any remedy for the recovery
(a) from the borrower of money loaned by a credit union in contravention of this Act or the regulations; and
(b) from the member of any amount withdrawn in excess of the amount standing to the member's credit in its deposit accounts.
38 Repealed.
39 In the event that a deposit account contains less than a prescribed amount and no business has been transacted in connection with such account over a prescribed period, the credit union shall be entitled to deal with such account in a prescribed manner.
Members right to withdraw deposits
40(1) A member shall be entitled to the balance remaining in any deposit account maintained by the member at the credit union together with any accrued interest at any time during normal business hours of the credit union.
Notice of intention to withdraw shares or deposits
40(2) A credit union may, in its sole discretion, require up to 90 days notice in writing of a member's intention to withdraw deposits or to redeem any shares.
40(3) The directors of a credit union may extend the notice period referred to in subsection (2) but shall inform the members in writing as to the actual notice period required.
40(4) Subsections (2) and (3) do not apply in those circumstances where a member has placed deposits with a credit union for a stated term or in an account on which a bill of exchange payable on demand may be drawn.
40.1(1) A credit union shall not impose undue pressure on or coerce a member to obtain a product or service from the credit union as a condition for obtaining another product or service from it.
40.1(2) Despite subsection (1), a credit union may offer a product or service to members on more favourable terms if the member obtains it with another product or service than if the member obtains it alone.
41(1) Except where the credit union is itself the trustee, a credit union is not bound to see to the execution of any trust, whether express, implied or constructive, to which any share or deposits are subject, and where such an account is subject to a trust of which the credit union has notice, the cheque, bill of exchange, withdrawal slip, or receipt of the person
(a) in whose name the account stands; or
(b) who is according to the document creating the trust entitled to deal therewith;
is, notwithstanding any such trust, sufficient authorization and a valid and binding discharge of the credit union, and the credit union is not bound to see to the application of any money paid upon or with respect to any such cheque, bill of exchange, withdrawal slip or receipt.
Non-application of trust moneys
41(2) Unless the instrument of trust permits, moneys on deposit in a credit union held by a trustee in trust for a named beneficiary, or otherwise, may not be charged to secure a loan or obligation.
41(3) Where a member of a credit union dies and there is no executor of a will of the deceased member or administrator of the estate of the deceased member, the credit union may, upon receipt of an affidavit or such other proof of death or proof of claim as may be required by the credit union, pay a prescribed amount out of moneys standing to the credit of the deceased member to the person who appears to be entitled to the amount of the deceased member's interest and payment made under this section releases the credit union from any further liability with respect to the moneys so paid.
42(1) Subject to the regulations, a credit union shall establish loan policies governing all its lending activities.
42(1.1) A credit union may, in accordance with its loan policies and the regulations,
(a) make loans to its members, including directors, officers and employees;
(b) participate in a loan to a member of another credit union incorporated in Manitoba or of a caisse populaire incorporated in Manitoba, if it has entered into a written agreement for that purpose with each other credit union and each caisse populaire participating in the loan; and
(c) acquire from
(i) another credit union incorporated in Manitoba its interest in a loan made to a member of the other credit union, or
(ii) a caisse populaire incorporated in Manitoba its interest in a loan made to a member of the caisse populaire.
42(2) Subject to section 49, a credit union may by by-law permit its members to repay loans, in whole or in part, on any day on which the office of the credit union is open for business.
S.M. 1996, c. 28, s. 22; S.M. 2004, c. 29, s. 11.
43 Repealed.
44(1) Notwithstanding anything in this Act to the contrary, a credit union has a lien on the deposits and shares of a member or other person to whose credit the deposits and shares stand in the records of the credit union together with interest or dividends thereon for any indebtedness due or accruing due to it by the member or other person or for any obligation in respect of the indebtedness, and the deposits and shares may not be withdrawn or redeemed unless the credit union consents.
Application of deposits and shares
44(2) A credit union may apply the deposits and shares, and interest or dividends thereon on which it has a lien to any indebtedness in default or to any obligation in respect of the indebtedness without notice to any person, and the exercise of the lien by application of the deposits, shares, interest and dividends does not constitute a realization of a security interest within the meaning of any other Act.
44(3) For purposes of subsection (2) an indebtedness shall be deemed to be in default where:
(a) an amount of the principal or interest is not paid on the date upon which it becomes due and payable; or
(b) there has been a failure to observe or perform any obligation relating to the indebtedness.
45 No officer or employee of a credit union shall permit a withdrawal of funds from a deposit account of a member where the funds in such account are not sufficient to cover the withdrawal, except as may be prescribed.
46(1) To meet withdrawals from deposit accounts, every credit union shall establish and maintain liquidity reserves as prescribed.
46(2) All investments made by a credit union for purpose of meeting liquidity reserve requirements shall be made in financial instruments as prescribed.
46(3) A credit union may only make investments, other than investments made for the purpose of maintaining liquidity reserves, as may be prescribed.
Allowance for doubtful accounts
47 A credit union shall establish and maintain an allowance for doubtful accounts as prescribed.
48(1) A credit union shall, in addition to the allowance provided for in section 47, establish and maintain a level of capital as prescribed.
48(2) Repealed, S.M. 1996, c. 28, s. 24.
S.M. 1987-88, c. 66, s. 6; S.M. 1996, c. 28, s. 24.
49 A credit union shall match the term and return of its investments and loans with the term and return of member deposits in the credit union as prescribed.
50 Subject to this Act and the regulations, a credit union shall maintain such types and minimum levels of insurance and bonding coverage as may be determined from time to time by the guarantee corporation.
51(1) Where the returns required to be filed by a credit union disclose, or where the Registrar otherwise learns that the stated value of the assets of a credit union are greater than their realizable value, the Registrar may require the credit union to take such steps as the Registrar deems appropriate to ensure that the financial position of the credit union is accurately reflected in the records of the credit union.
Registrar prohibiting deposits or payments
51(2) Where it appears to the Registrar that the realizable value of the assets of a credit union are less than the aggregate of its liabilities and its capital other than retained surplus and common shares, the Registrar may prohibit the credit union from taking deposits or making payments to its members, or the Registrar may limit those payments for such period as the Registrar considers necessary to protect the interest of the members, and the Registrar may take such other action as the Registrar considers necessary for the protection of or in the interest of the members.
PART V.1
SECURITY ISSUES
51.1 The Securities Act
(a) applies to the issue or sale by a credit union of its securities if they may be issued or sold to the public; and
(b) does not apply to
(i) the issue or sale of surplus shares by a credit union,
(ii) the issue or sale by a credit union of its securities if only credit union members are eligible to own the securities and the issue or sale is restricted to members, or
(iii) deposits in a credit union.
Application of sections 51.2 to 51.4
51.1.1 Sections 51.2 to 51.4
(a) apply to a credit union's issue or sale of its securities if The Securities Act does not apply; and
(b) do not apply to
(i) the issue or sale of surplus shares by a credit union,
(ii) a credit union's issue or sale of securities if The Securities Act applies, and
(iii) deposits in a credit union.
S.M. 1996, c. 28, s. 27; S.M. 2004, c. 29, s. 12.
51.2(1) Before a credit union issues or sells shares or other securities, it shall
(a) send the Registrar an offering statement that
(i) is in a form approved by the Registrar,
(ii) fully, truly and plainly discloses all material facts relating to the shares or securities and the purposes for which the funds to be raised by their issue or sale are to be used,
(iii) complies as to content with, and is otherwise in accordance with, this Act and the regulations, and
(iv) is accompanied by any documents, reports and other material required by this Act and the regulations; and
(b) obtain a receipt for the offering statement.
51.2(2) A credit union shall send the Registrar an amending statement if there is a material change in the facts set out in an offering or amending statement previously sent to the Registrar, whether the change occurs before or after the credit union receives a receipt. The statement shall fully, truly and plainly state the details of the change and be sent within 30 days after the change occurs or the credit union becomes aware of it.
Revised offering statements — voluntary
51.2(3) Instead of an amending statement, a credit union may send the Registrar a revised offering statement that contains all material changes of fact that have occurred since the offering statement was sent.
Revised offering statements — mandatory
51.2(4) The Registrar may require a credit union to send the Registrar a revised offering statement when there is a material change of the facts set out in the offering statement, or an amending statement or revised offering statement, and the Registrar considers that an amending statement is not appropriate. Within 30 days after the Registrar requires it, the credit union shall send the Registrar a revised offering statement that contains all material changes of fact that have occurred since the offering statement was sent.
Shares must not be sold after material change
51.2(5) When there is a material change in the facts set out in an offering, amending or revised offering statement, the credit union shall immediately cease issuing or selling the shares or securities that the statement relates to. The credit union shall not issue or sell any more of the shares or securities until it sends the Registrar an amending statement or revised offering statement about the change, and receives a receipt.
S.M. 1996, c. 28, s. 27; S.M. 2004, c. 29, s. 13.
51.3(1) The Registrar may issue a receipt for an offering statement, amending statement or revised offering statement, unless the Registrar believes that
(a) the statement or a document required to be sent with the statement
(i) does not comply in a substantial respect with a requirement of this Act or the regulations,
(ii) contains an assertion, promise, estimate or forecast that is misleading or false, or
(iii) conceals or omits to state a material fact;
(b) the proceeds from the issue or sale of the shares or securities described in the statement that are to be paid to the credit union are, together with its other resources, insufficient to accomplish the purpose of the issue or sale stated in the offering statement;
(c) the credit union has paid or given or intends to pay or give an unconscionable consideration for promotional purposes or for the acquisition of property;
(d) the credit union has not entered into an escrow or pooling agreement that the Registrar considers necessary or advisable; or
(e) the credit union has not entered into an agreement that the Registrar considers necessary or advisable to provide for holding the proceeds payable to the credit union from the issue or sale of the shares or securities in trust pending the distribution of the shares or securities.
51.3(2) The Registrar shall not refuse to issue a receipt for an offering statement, amending statement or revised offering statement sent by a credit union under section 51.2 without making a ruling or order and giving the credit union an opportunity to be heard before making it.
S.M. 1996, c. 28, s. 27; S.M. 2004, c. 29, s. 14.
Exception from application of sections 51.2 and 51.3
51.3.1 Sections 51.2 and 51.3 do not apply to a credit union's issue or sale of shares or other securities if the issue or sale is exempted from the application of those sections by the regulations or by an order of the Registrar.
Registrar may stop issue or sale of shares
51.3.2(1) The Registrar may order a credit union to stop issuing or selling its shares or other securities if
(a) subsection 51.2(1) requires that an offering statement relating to the securities be sent to the Registrar; and
(b) the Registrar thinks that any of the circumstances described in clauses 51.3(1)(a) to (e) exist in respect of the securities or their issue or sale.
51.3.2(2) Without delay after making the order, the Registrar shall give notice of it to
(a) the credit union; and
(b) an agent of the credit union who is acting in connection with the issue or sale of the shares or securities if the credit union has informed the Registrar about the agency relationship.
51.3.2(3) The Registrar shall not make the order without first giving the credit union an opportunity to be heard about it.
51.3.2(4) Despite subsection (3), if the Registrar thinks that the time required for a hearing may be prejudicial to the public interest, he or she may make an order under subsection (1) that expires 15 days after it is made.
Obligation to provide offering statement
51.3.3(1) A credit union shall not sell a share or security to which section 51.2 applies unless, before the sale, the credit union or its agent provides the purchaser with
(a) a copy of the latest offering statement for the share or security that the Registrar has issued a receipt for; and
(b) any amending statements that the Registrar has issued receipts for in relation to the latest offering statement.
51.3.3(2) The purchaser of a share or security of a credit union may cancel the purchase by notifying the credit union or the agent who sold the share or security. The notification must
(a) state in writing that the purchaser does not intend to be bound by the sale;
(b) be sent by fax, mail or delivery; and
(c) be received by the credit union or agent no later than 48 hours, excluding Saturdays and holidays, after the later of
(i) the time of the purchase, and
(ii) the time the purchaser receives the statements that subsection (1) requires the credit union to provide.
51.4(1) A copy of a statement for which the Registrar has issued a receipt under section 51.3 shall be open to inspection by any person
(a) at the offices of the Registrar; and
(b) during normal business hours, at the registered office of the credit union.
51.4(2) Any person may take extracts from any statement open to inspection under subsection (1).
PART V.2
SHARE CERTIFICATES, MEMBERSHIPS AND TRANSFERS
51.5 Shares in the capital stock of a credit union and memberships in a credit union are personal estate and are transferable in such manner and subject to such conditions and restrictions as are contained in this Act and the regulations and in the articles and by-laws of the credit union.
51.6 Subject to this Act and in the absence of any provision to the contrary in the articles or by-laws of a credit union, shares in the capital stock of the credit union may be allotted at such times, in such manner and to such persons or class of persons as the directors may from time to time by resolution determine.
51.7(1) Subject to subsection (6), every shareholder of a credit union is, upon request and without payment, entitled to a certificate, signed by the proper officer or officers of the credit union, stating the number of shares held by him and the amount paid up thereon; but, in respect of a share or shares held jointly by two or more persons, the credit union is not bound to issue more than one certificate, and delivery of a certificate for a share to one of two or more joint shareholders is sufficient delivery to all.
51.7(2) A credit union may by by-law provide that the signatures of the officer or officers designated to sign share certificates may be engraved, lithographed or otherwise mechanically reproduced on the certificates, and in that event, subject to the by-law, share certificates so signed are deemed to have been manually signed by that officer or officers and are as valid to all intents and purposes as if they had been manually signed.
Certificates as evidence of title
51.7(3) A share certificate is evidence of the title of the shareholder to the shares mentioned in it.
Particulars of issue on share certificate
51.7(4) Where a credit union has more than one class of shares,
(a) the preferences, rights, conditions, restrictions, limitations or prohibitions attaching to any class of shares shall be stated in legible characters
(i) on every share certificate representing that class of shares, or
(ii) by a writing permanently attached to the share certificate; or
(b) there shall be inscribed on each share certificate representing a particular class of shares, in legible characters, a statement that there are preferences, rights, conditions, restrictions, limitations or prohibitions attached to the class of shares and that the full text thereof is obtainable on request and without fee from the secretary of the credit union.
Furnishing text of particulars
51.7(5) Where the statement referred to in clause (4)(b) is inscribed on share certificates of a credit union, the secretary of the credit union shall furnish to any shareholder, on request and without fee, the full text of any preferences, rights, conditions, restrictions, limitations or prohibitions attached to the class of shares mentioned.
51.7(6) The by-laws may provide that a credit union is not required to issue share certificates, and in that case
(a) the shareholders register kept by the credit union under clause 19(1)(e) is prima facie proof of the number of shares held by each shareholder; and
(b) the credit union shall, if requested in writing by a shareholder, provide a statement to the shareholder showing the shareholder's interest in the credit union.
S.M. 1996, c. 28, s. 27; S.M. 2004, c. 29, s. 16.
Transfers of shares or memberships
51.8 No transfer of a share or membership in a credit union is valid for any purpose
(a) unless a written application for membership by the transferee has been approved and the transfer has been authorized by a resolution of the directors of the credit union or by a person authorized by a resolution of the directors to approve applications and transfers of that kind; and
(b) until notification of any approval given under clause (a) has been sent to the transferee and the transferee's name has been entered on the members register;
save only as exhibiting the rights of the parties thereto towards each other.
Dealings with registered holder
51.9(1) Before the presentment for registration of the transfer of a share or other security in registered form, a credit union or a trustee under a trust indenture may treat as the absolute owner of the security the registered holder in whose name the security is registered in a members or securities register, as if that person had full legal capacity and authority to exercise all rights of ownership irrespective of
(a) any knowledge or notice to the contrary, except that obtained by virtue of documents demanded by the credit union or trustee; or
(b) any description in its records or on the security certificate indicating
(i) a pledge, a representative or a fiduciary relationship, or
(ii) a reference to any other instrument, or
(iii) the rights of any other person.
Constructive registered holder
51.9(2) Notwithstanding subsection (1), a credit union shall treat a person as a registered holder entitled to exercise all the rights of the security holder he or she represents, if the person furnishes evidence satisfactory to the credit union that he or she is
(a) the executor, administrator, heir or legal representative of the heirs of the estate of a deceased registered holder; or
(b) a guardian, committee or trustee representing a registered holder who is an infant, an incompetent person or a missing person; or
(c) a liquidator of, or a trustee in bankruptcy for, a registered holder.
51.9(3) If a person upon whom the ownership of a security devolves by operation of law, other than a person described in subsection (2), furnishes proof of his or her authority to exercise rights or privileges in respect of a security of the credit union that is not registered in his or her name, the credit union shall treat the person as entitled to exercise those rights or privileges.
51.9(4) A credit union is not required to inquire into the existence of, or see to the performance or observance of, any duty owed to a third person by a registered holder of any of its securities or by anyone whom it treats, as permitted or required by this section, as the owner or registered holder thereof.
51.9(5) If an infant exercises any rights of ownership in the securities of a credit union, no subsequent repudiation or avoidance of that exercise is effective against the credit union.
51.9(6) A credit union may treat as the owners of a security the survivors of the joint holders of the security if it receives proof satisfactory to it of the death of any of the joint holders.
51.9(7) Subject to any applicable law relating to the collection of taxes, a person referred to in clause (2)(a) is entitled to become a registered holder, or to designate a registered holder, if he or she deposits with the credit union or its transfer agent
(a) the original grant of probate or of letters of administration, or a copy thereof certified to be a true copy by
(i) the court that granted the probate or letters of administration, or
(ii) a trust company incorporated under the laws of Canada or a province, or
(iii) a lawyer or notary acting on behalf of the person; or
(b) in the case of transmission by notarial will in the Province of Quebec, a copy authenticated pursuant to the laws of that Province;
together with
(c) an affidavit or declaration of transmission made by the person, stating particulars of the transmission; and
(d) the security certificate that was owned by the deceased holder, endorsed by the person and accompanied by any assurance the credit union may require that the endorsement is genuine and effective.
51.9(8) Notwithstanding subsection (7), if the laws of the jurisdiction governing the transmission of a security of a deceased holder do not require a grant of probate or of letters of administration in respect of the transmission, the legal representative of the deceased holder is entitled, subject to any applicable law relating to the collection of taxes, to become a registered holder or to designate a registered holder if he or she deposits with the credit union or its transfer agent
(a) the security certificate that was owned by the deceased holder; and
(b) reasonable proof of the governing laws, of the interest of the deceased holder in the security and of the right of the legal representative or the person he or she designates to become the registered holder.
51.9(9) Deposit of the documents required by subsection (7) or (8) empowers a credit union or its transfer agent to record in a members or shareholders securities register the transmission of a security from the deceased holder to a person referred to in clause (2)(a) or to such person as the person referred to in that clause may designate and, thereafter, to treat the person who thus becomes a registered holder as the owner of that security.
PART VI
MEMBERSHIP
52(1) The membership of a credit union consists of its incorporators and those persons whose applications for membership are accepted by the directors, or by a person the directors authorize to approve applications, in accordance with the provisions of this Act, the regulations, the articles and by-laws of the credit union.
Refusal of membership application
52(2) The directors of a credit union may refuse to approve any application for membership where they are satisfied that it is not in the interest of the credit union to approve such application.
52(3) A person under 18 years of age may be accepted as a member of a credit union and shares may be held and moneys received by the credit union in that person's name or in the name of a trustee for that person, if the trustee is a member or is eligible to be a member of the credit union.
52(4) No credit union may be a member of another credit union or caisse populaire.
S.M. 1996, c. 28, s. 28; S.M. 2004, c. 29, s. 17.
53(1) The articles of a credit union may provide that membership in the credit union shall be limited to groups having a bond of association.
53(2) Where the articles of a credit union contain a provision under subsection (1), any member of the credit union who leaves the bond of association may nevertheless retain membership in the credit union and all the rights and privileges of a member.
54(1) A credit union shall not permit a person to become an associate unless its articles permit it to have associates and it has enacted a by-law under clause 6(4)(a).
54(2) At no time shall the number of associates exceed 1/4 of the number of members of the credit union.
54(3) No credit union may be an associate of another credit union.
54(4) Subject to this Act, an associate of a credit union shall have all the rights and privileges, and shall be subject to all of the obligations of a member of a credit union, except that an associate shall not
(a) vote at any meeting of members; and
(b) become an officer or a director of a credit union.
S.M. 1996, c. 28, s. 29; S.M. 2004, c. 29, s. 18.
55(1) Unless the by-laws otherwise provide, the directors by a resolution passed by a majority of not less than 3/4 of the directors at a meeting called to consider the resolution, may terminate the membership of a member.
55(2) The member whose membership is proposed to be terminated by a resolution of the directors under subsection (1) is entitled to at least 7 days notice of the meeting at which the resolution is to be considered, together with a statement of the grounds upon which the membership is proposed to be terminated, and is entitled to appear, either personally, or by or with an agent or counsel, to make submissions at the meeting.
55(3) Within 7 days after the date on which the resolution referred to in subsection (1) is passed by the requisite majority, the credit union shall, in the same manner as that provided for the giving of notice of a meeting of members, notify the person whose membership was terminated of the resolution.
55(4) A person whose membership is terminated under subsection (1) may appeal the decision of the directors at the next meeting of members by sending a notice of appeal to the credit union within 14 days after the date when notice was given under subsection (3).
No right of appeal under subsection (4)
55(4.1) Subsection (4) does not apply to a person whose membership is terminated under subsection (1) if the grounds for termination include causing financial loss to a credit union through fraud or by
(a) issuing illegal negotiable instruments; or
(b) breaching a term or condition of an agreement for the use of electronic services provided by the credit union.
55(5) The meeting of members to which an appeal under subsection (4) is brought shall, by a majority vote, either confirm or set aside the resolution of the directors terminating the membership of a member.
Termination by meeting of members
55(6) A meeting of members may, by special resolution, terminate the membership of a member.
55(7) and (8) Repealed, S.M. 1996, c. 28, s. 30.
55(9) A person who in accordance with subsection (4) appeals a termination of membership shall, notwithstanding the resolution terminating membership, continue to be a member of the credit union until the termination is confirmed by the meeting of members under subsection (5).
55(10) A person whose membership is terminated upon an appeal to, or by special resolution of, a general meeting in accordance with this section shall not again be admitted to membership in the credit union except by special resolution of a general meeting.
55(11) This section does not apply to associates.
55(12) Renumbered as section 55.1.
S.M. 1996, c. 28, s. 30; S.M. 2004, c. 29, s. 19.
Suspension of services to member
55.1 A credit union may at any time suspend its services to a member who has caused financial loss to the credit union through fraud or by
(a) issuing illegal negotiable instruments; or
(b) breaching a term or condition of an agreement for the use of electronic services provided by the credit union.
S.M. 1996, c. 28, s. 30; S.M. 2004, c. 29, s. 19.
56(1) A member may withdraw from a credit union on such terms and conditions as this Act, the articles or the by-laws of the credit union may provide.
Terms on withdrawal or termination
56(2) No provisions in respect of terminated or withdrawing members shall affect the provisions of any contract between a terminated or withdrawing member and the credit union, and without restricting the generality of the foregoing, shall not affect the term for which any person has agreed to place deposits with the credit union.
57 Withdrawal from or termination of membership in a credit union does not release a person from any liability to the credit union.
58(1) The members of a credit union may, subject to this Act and the articles of the credit union, at any annual meeting or general meeting called for the purpose, enact, amend, or repeal by-laws in respect of those matters authorized or required by any provision of this Act.
58(2) Any by-law may be enacted, amended or repealed by the members of a credit union
(a) if approved by special resolution of the members; or
(b) if written notice of the proposed enactment, amendment or repeal is forwarded to each member of the credit union with the notice of the meeting at which the enactment, amendment or repeal is to be considered, by a majority of the votes cast at the meeting.
58(3) Repealed, S.M. 1996, c. 28, s. 32.
58(4) The enactment, amendment or repeal of a by-law is effective on, from and after the date of the members' approval.
58(4.1) A credit union shall send
(a) a copy of the by-laws adopted at the first meeting of its members to the Registrar within 30 days after they are adopted;
(b) a copy of any by-law passed subsequently, and any amendment to its by-laws, to the Registrar within 30 days after the by-law is passed or amended; and
(c) a notice of the repeal of any of its by-laws to the Registrar within 30 days after the repeal.
58(5) The Registrar may order a credit union to enact a by-law consistent with, or to amend or repeal a by-law that is inconsistent with, the provisions of this Act, the regulations or the credit union's articles or other provisions of the credit union's by-laws, and the credit union shall enact, amend or repeal the by-law accordingly.
58(6) Repealed, S.M. 1996, c. 28, s. 32.
S.M. 1996, c. 28, s. 32; S.M. 2004, c. 29, s. 20.
Members bound by articles and by-laws
59 The articles and by-laws of a credit union bind the credit union and its members.
60 Meetings of the members of a credit union shall be held at the place within Manitoba provided in the by-laws or, in the absence of that provision, at the place within Manitoba that the directors may determine.
61 The directors of a credit union
(a) shall call an annual meeting of members which shall be held within 4 months after the fiscal year end of the credit union to consider the annual report of the directors, the financial statements, and the auditor's report, to appoint the auditor, to elect directors and such other matters as may properly come before the meeting; and
(b) may at any time call a special meeting of members.
62 The record date for determining which members are entitled to receive notice of a meeting of members shall be at the close of business on the day immediately preceding the day on which the notice is given.
63(1) Notice of the time and place of a meeting of members shall be given in accordance with the provisions of the by-laws or, in the absence of those provisions, shall be given not less than 14 days nor more than 50 days before the meeting to each member entitled to vote at the meeting, and to the auditor of the credit union.
63(2) Where a meeting of members is adjourned for seven days or less, it is not necessary, unless the by-laws otherwise provide, to give notice of the adjourned meeting other than by announcement at the earliest meeting that is adjourned.
63(3) Where a meeting of members is adjourned by one or more adjournments for more than 7 days, notice of the adjourned meeting shall be given in the same way as for an original meeting.
63(4) All business transacted
(a) at a special meeting of members; or
(b) at an annual meeting of members, except consideration of the annual report of the directors, the financial statements, the auditor's report, the election of directors, the reappointment of the incumbent auditor and any other business authorized by the by-laws to be transacted at an annual meeting;
is deemed to be special business.
63(5) The notice of a meeting of members at which special business is to be transacted shall include
(a) a statement of the nature of the business, in sufficient detail to permit the member receiving the notice to form a reasoned judgment thereon; and
(b) the text of any special resolution to be submitted to the meeting or, if the full text is too lengthy for convenient inclusion in the notice, a summary thereof.
S.M. 1996, c. 28, s. 33; S.M. 2004, c. 29, s. 21.
64 A member or any other person entitled to attend a meeting of members may in any manner waive notice of the meeting, and the attendance of the member or other person at the meeting is itself a waiver of notice of the meeting, except where that person attends for the express purpose of objecting to the transaction of any business on the ground that the meeting was not lawfully called.
65(1) A member entitled to vote at a meeting of members may
(a) submit to the credit union notice of any matter that the member proposes to raise at the meeting (hereinafter referred to as a "proposal"); and
(b) discuss at the meeting any matter in respect of which the member would have been entitled to submit a proposal.
65(2) A credit union shall set out any proposal in the notice of the meeting at which the proposal is to be presented.
65(3) If so requested by a member submitting a proposal, the credit union shall include in the notice or attach thereto a statement by the member, of not more than 200 words, in support of the proposal, and the name and address of the member.
65(4) A proposal may include nominations for the election of directors provided that the election of those nominated as directors would conform to the provisions of this Act, the articles and by-laws of the credit union, but this subsection does not prevent nominations being made at any meeting of members.
65(5) A credit union is not required to comply with subsections (2) and (3) if
(a) the proposal is not submitted to the credit union at least 90 days before the first anniversary date of the previous annual meeting of members; or
(b) it clearly appears that the proposal is submitted by the member primarily for the purpose of enforcing a personal claim or redressing a personal grievance against the credit union or its directors, officers, members or other security holders, or primarily for the purpose of promoting general economic, political, racial, religious, social or similar causes; or
(c) the credit union, at the member's request, included a proposal in the notice of meeting of members held within 2 years preceding the receipt of the submission under subsection (1), and the member failed to present the proposal at that meeting; or
(d) substantially the same proposal was submitted to the members in the notice of a meeting of members held within 2 years preceding the receipt of the member's request, and the proposal was defeated; or
(e) the rights conferred by this section are being abused to secure publicity.
65(6) No credit union or person acting on its behalf incurs any liability by reason only of circulating a proposal or statement in compliance with this section.
65(7) Where a credit union refuses to include a proposal in a notice of meeting, the credit union shall within 10 days after receiving the proposal notify the member submitting the proposal of its intention to omit the proposal from the notice and send to the member a statement of the reasons for the refusal.
65(8) Upon the application of a member claiming to be aggrieved by a refusal under subsection (7), the court may restrain the holding of the meeting to which the proposal is sought to be presented and make any further order it thinks fit.
Credit union application to court
65(9) The credit union or any person claiming to be aggrieved by a proposal may apply to the court for an order permitting the credit union to omit the proposal from the notice of meeting, and the court, if it is satisfied that subsection (5) applies, may make the order.
65(10) An applicant under subsection (8) or (9) shall give the Registrar notice of the application, and the Registrar is entitled to appear and be heard in person or by counsel.
66(1) Unless its by-laws otherwise provide, the quorum for members' meetings of a credit union is the number of members that is five more than the number of its directors.
66(2) If a quorum is present at the opening of a meeting of members, the members present may, unless the by-laws otherwise provide, proceed with the business of the meeting, notwithstanding that a quorum is not present throughout the meeting.
66(3) If a quorum is not present at the opening of a meeting of members, the members present may adjourn the meeting to a fixed time and place but may not transact any other business.
66(4) This section does not apply to associates.
S.M. 1996, c. 28, s. 31; S.M. 2004, c. 29, s. 22.
67(1) A member of a credit union who is 18 years of age or more may vote on matters that are submitted to the members for a decision.
67(2) Subject to subsection (1) and subsection 35(2), a member of a credit union has only one vote on a matter that is submitted to the members for a decision.
Representatives of corporations
68(1) Where a body corporate or association is a member of a credit union, the credit union shall recognize an individual authorized by resolution of the directors or governing body of the body corporate or association to represent it at meetings of members of the credit union.
68(2) An individual authorized under subsection (1) may exercise, on behalf of the body corporate or association referred to in that subsection, all the powers the body corporate or association could exercise if it were an individual member.
69(1) Unless the by-laws otherwise provide, no member, other than a member that is a body corporate or association, shall vote by proxy at any meeting of members of a credit union.
Limitations on proxies and representation
69(2) Where the by-laws provide for voting by proxy, no person other than a member of a credit union may be appointed proxy, and
(a) no member may vote more than one proxy;
(b) no member may represent more than one body corporate or association; and
(c) no member may both vote a proxy and represent a body corporate or association;
at a meeting of members of a credit union.
69(3) This section does not apply to associates.
70 A credit union may, in its by-laws, provide that 2 or more individuals may jointly hold a membership in a credit union but that membership is entitled to one vote only.
71(1) Subject to subsection (2), a credit union may, by by-law, establish procedures to permit members to vote by a method other than show of hands or ballot.
71(2) On fundamental changes, within the meaning of Part IX, voting by members shall be by show of hands or ballot at the members' meeting called for that purpose.
S.M. 1996, c. 28, s. 35; S.M. 2004, c. 29, s. 24.
72 Every executor or administrator holding a membership or share in the credit union in the capacity of executor or administrator shall represent that membership or share at meetings of the credit union and may vote as a member or shareholder.
73(1) Unless the by-laws otherwise provide, voting at a meeting of members shall be by show of hands, except where a ballot is demanded by a member entitled to vote at the meeting.
73(2) A member may demand a ballot either before or after any vote by show of hands, and the result of the ballot shall be the decision of the members.
74(1) Twenty-five members who have the right to vote at a meeting sought to be held or such other number of members or percentage of members as the by-laws may provide, may, by written requisition, require the directors to call a special meeting of members for the purposes stated in the requisition.
74(2) The requisition referred to in subsection (1) may consist of several documents of like form each signed by one or more members, and shall state the business to be transacted at the meeting and shall be sent to the registered office of the credit union.
74(3) Upon receiving the requisition referred to in subsection (1), the directors shall call a meeting of members to transact the business stated in the requisition, unless the business of the meeting as stated in the requisition includes a matter described in clauses 65(5)(b) to (e).
74(4) If the directors do not within 30 days after receiving the requisition referred to in subsection (1) call a meeting, any member who signed the requisition may call the meeting.
74(5) A meeting called under this section shall be called as nearly as possible in the manner in which meetings are to be called pursuant to this Act and the by-laws.
74(6) Unless the members otherwise resolve at a meeting called under subsection (4), the credit union shall reimburse the members for the expenses reasonably incurred by them in requisitioning, calling and holding the meeting.
75(1) If, for any reason, it is impracticable to call a meeting of members of a credit union in the manner in which meetings of members may be called, or to conduct the meeting in the manner prescribed by the Act and the by-laws, or if for any other reason the Registrar thinks fit, the Registrar may order a meeting to be called, and direct the manner of conducting the meeting and such meeting is for all purposes a meeting