The Credit Unions and Caisses Populaires Act

S.M. 1986-87, c. 5

The Credit Unions and Caisses Populaires Act

(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

Definitions.

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 as set out in the charter by-laws or the Act, in a credit union or central; ("associé")

"auditor" includes a partnership of auditors; ("vérificateur")

"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" )

"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 CCSM or Fédération; ("centrale")

"charter by-law" means a by-law of a credit union or central that requires the approval of the Registrar; ("règlement constitutif')

"court" means the Court of Queen's Bench; ("Tribunal")

"credit union" includes, as the context may require, a "caisse populaire"; ("caisses populaire")

"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 charter 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 a person occupying the position of director of a credit union or central; ("administrateur")

"Fédération" means La Fédération des Caisses Populaires du Manitoba Inc.; ("Fédération")

"Fonds de sécurité" means Le Fonds de sécurité des Caisses Populaires; ("Fonds de sécurité")

"fund" means The Stabilization Fund or Le Fonds de sécurité, as the context may require; ("fonds")

"guarantee fund" means those moneys collected and administered by a fund for the purpose of protecting deposits in a credit union; ("fonds de garantie")

"immediate family" means the spouse, 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 charter 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 fund; ("dirigeant")

"ordinary by-law" means a by-law of a credit union other than a charter by-law; ("règlement administratif ordinaire")

"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")

"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 fund taken by a creditor to secure payment of a debt or performance of any other obligation of the credit union, central or fund, 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")

"Stabilization Fund" means The Credit Union Stabilization Fund; ("Stabilization Fund")

"subsidiary" means a body corporate in which a credit union or central has a majority of the voting shares; ("filiale")

"system" means

(i) CCSM, the Stabilization Fund and those credit unions assigned to them, or

(ii) Fédération, Fonds de sécurité and the caisses populaires assigned to them, as the context may require. ("système")

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 that meet the needs of their members and to provide for the direction and democratic control of such services 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 that meet the needs of their members and to provide for the direction and democratic control of such services by French-speaking residents of Manitoba.

Application of Act.

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 fund heretofore incorporated under similar legislation of the province in force before the coming into force of this Act.

Inconsistent provisions.

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

Application for incorporation.

5(1)

Any 10 or more individuals, no one of whom

(a) is less than 18 years of age; or

(b) has the status of a bankrupt; may apply for incorporation as a credit union by sending to the Registrar, in duplicate, articles of incorporation, a notice of registered office in the prescribed form, and the proposed charter by-laws.

Model forms.

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 and charter by-laws for the use of credit unions.

Articles of incorporation.

6(1)

Articles of incorporation shall follow the prescribed form and shall set out, in respect of the proposed credit union,

(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 charter by-laws.

Consent of first director.

6(3)

The articles shall have attached thereto, in the prescribed form, the consent of a first director who is not an incorporator.

Charter by-laws.

6(4)

The charter 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; the mode of holding meetings and the quorum thereat; the rights of voting and of making, repealing or amending by-laws; the right of members to vote by ballot or mail or both; and the manner, form and effect of votes at 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) the incorporation and ownership of subsidiary companies by the credit union;

(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 charter by-laws.

Filing of articles and charter by- laws.

7

The Registrar may accept for filing and approval any articles and charter by-laws 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 fund, and

(iv) the proposed bond of association, if any, is not objectionable;

(b) the articles are in compliance with the provisions of this Act; and

(c) the Registrar approves the charter by-laws.

Certificate of incorporation.

8

Upon acceptance for filing and approval of the articles and charter by-laws, the Registrar shall issue a certificate of incorporation in accordance with section 228.

Effect of certificate.

9

A credit union comes into existence on the date shown in the certificate of incorporation.

Name of credit union.

10(1)

Every credit union which is a member of CCSM and assigned to the Stabilization Fund, shall include the words "credit union" as part of its name and the word "Limited" or the abbreviation "Ltd. " shall be the last word of the name of such credit union.

Name of Caisse Populaire.

10(2)

Every caisse populaire which is a member of La Fédération and assigned to Le Fonds de sécurité shall include the words "caisse populaire" as part of its name and the word "Limitée" or the abbreviation "Ltée" shall be the last word of the name of such caisse populaire.

Name in any language form.

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.

Publication of name.

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.

Other name.

10(5)

Subject to section 12 and The Business Names Registration Act, a credit union may carry on business under or identify itself by a name other than its full legal name, provided that the words "credit union" or "caisse populaire", as the case may be, are included in such name.

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.

Exception.

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 fund or central to which this Act applies.

Reservation of name.

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.

Prohibited names.

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.

Undertaking not carried out.

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.

Directing change of name.

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.

Revoking a 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.

Change of name.

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.

Application to court

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

Capacity of a credit union.

14(1)

A credit union has the capacity and, subject to this Act, the rights, powers and privileges of a natural person.

Extra-territorial capacity.

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.

Powers of a credit union.

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.

Restricted business or powers.

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.

Rights preserved.

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.

No constructive notice.

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 charter by-laws.

16(2)

A member of a credit union is deemed to have notice and knowledge of the contents of the articles and charter 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, charter by-laws or ordinary 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

Registered office.

18(1)

A credit union shall at all times have a registered office, which shall be the principal place of business of the credit union, in the location within Manitoba specified in its articles.

Change of address.

18(2)

The directors of a credit union shall establish and may change the address of the registered office in the location specified in the articles.

Notice of registered office.

18(3)

A credit union shall send to the Registrar, within 15 days of any change, a notice in prescribed form, of any change of address of its registered office.

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 clause 114(1)(b).

Branch offices.

18(5)

A credit union may establish or relocate branch offices of the credit union as may be prescribed.

Records.

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.

Exception.

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 (l) 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.

Rescind order.

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.

Members register.

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.

Shareholders 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.

Affidavit.

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.

Offence.

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.

Form of records.

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.

Precautions.

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.

Corporate seal.

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

Common shares.

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.

Number of common shares.

23(2)

A credit union is not limited as to the number of common shares it may issue.

Common shares per member.

23(3)

A member of a credit union shall purchase and hold only one fully paid common share, unless the charter by-laws of the credit union permit or require members to purchase and hold more than one fully paid common share.

Transitional.

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.

Priority.

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.

Restriction.

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 fund.

No share certificates.

26(1)

A credit union is not required to issue share certificates for common or surplus shares.

Share certificates.

26(2)

Part VI of The Cooperatives Act applies, with the necessary changes, to the issuance of share certificates for shares of a credit union other than common or surplus shares.

Consideration.

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.

Patronage refund.

28(1)

After providing for all known liabilities, making allowance for doubtful accounts, and making such other provisions as are required by this Act and the regulations and after providing for payment of dividends, if any, on all classes of shares, the directors of a credit union may allocate, as a patronage refund among, and credit to, its members any surplus arising from the operations of the credit union in each fiscal year, and each member shall be entitled to a share thereof proportionate to the business done by that member with or through the credit union in that fiscal year as computed by the directors at a rate prescribed by them and approved by the members of the credit union at a general meeting thereof.

Computation of business done.

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.

Use of patronage refund or dividend for purchase of surplus shares.

29(1)

A credit union may in its charter bylaws provide that in each fiscal year of the credit union, the whole of any patronage refund or common or surplus share dividend credited to a member or such part thereof as may be set out in the charter by-laws of the credit union, shall be applied to purchase, on behalf of the member, surplus shares of the credit union, up to such number as may be specified in the charter by-laws.

Use of patronage refund or dividend for loan.

29(2)

A credit union may, in its charter by-laws, require its members to lend to it the whole, or such part as may be specified in the charter by-laws, of the patronage refunds or common or surplus share dividends to which the members may become entitled in any fiscal year, and the charter by-laws shall provide the terms upon which the loans are made including the method of their repayment and the rate of interest, if any, thereon.

Priority.

29(3)

Loans made to a credit union pursuant to subsection (2) shall, with respect to the repayment of capital, in the event of a winding-up or dissolution of a credit union, rank ahead of the common shares of the credit union.

Redemption or repayment.

30(1)

A credit union shall not make any payment to purchase or redeem shares issued by it or repay any loan of patronage refunds, or common or surplus share dividends, 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.

Restriction.

30(2)

Subject to subsection (1), no shares issued by a credit union, or any loan of patronage refunds or share dividends may be redeemed or paid out at a price or an amount exceeding the issue price or the amount lent to the credit union, as the case may be.

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 the directors and confirmed at a general meeting of members of the credit union.

Restriction.

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 equity other than retained surplus; or

(c) the equity of the credit union is, or would thereby be, less than the prescribed amount.

Exception.

32(2)

If, but for clause (1)(c), a credit union would be able to make any payments referred to in subsection (1), the Registrar may upon recommendation of the fund authorize any payments referred to in subsection (1) upon such terms and conditions as the Registrar deems advisable.

Limitation on holding of shares.

33

Unless the charter by-laws otherwise provide, no person shall hold more than 10% of the total number of issued shares of any class comprising the capital of the credit union.

Non application Securities Act.

34(1)

Subject to subsection (2), The Securities Act does not apply to the distribution of any securities by a credit union, including shares of, and deposits in, a credit union.

Application of Part XVI of The Cooperatives Act

34(2)

Part XVI of The Cooperatives Act applies, with the necessary changes, to the distribution of any securities by a credit union except for common and surplus shares of, loan of a patronage refund to and deposits in a credit union.

Non voting shares.

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).

Class vote.

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.

Limit of liability.

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.

Remedy preserved.

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.

Trust indentures.

38

Part VII of The Cooperatives Act applies, with the necessary changes, to the issue of debt obligations by a credit union.

Unclaimed balances.

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.

Extension of notice period.

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.

Exception.

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.

Trust funds.

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.

Payment on death.

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.

Loans.

42(1)

A credit union shall establish loan policies governing all lending activities of the credit union as prescribed and may, in accordance with such loan policies and the regulations, make loans to its members, including directors, officers and employees.

Right to repay.

42(2)

Subject to section 49, a credit union may, in its charter by- laws, 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.

Material deposits.

43

A credit union shall report to the central the existence of any deposit in excess of a prescribed amount.

Lien on deposits and shares.

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.

Default

44(3)

For purposes of subsection (2) an indebtedness shall be deemed to be in default where:

(a) ah 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.

Restrictions on overdrafts.

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.

Liquidity.

46(1)

To meet withdrawals from deposit accounts, every credit union shall establish and maintain liquidity reserves as prescribed.

Liquidity investments.

46(2)

All investments made by a credit union for purpose of meeting liquidity reserve requirements shall be made in financial instruments as prescribed.

Investments generally.

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.

Equity.

48(1)

A credit union shall, in addition to the allowance provided for in section 47, establish and maintain a level of equity as prescribed.

Equity defined.

48(2)

For purposes of this Part, the equity of a credit union shall include

(a) the value of the consideration paid for all shares issued by a credit union; and

(b) the value of the consideration paid for any other securities issued by the credit union that are

(i) not subject to the guarantee of the fund, and

(ii) not repayable by the credit union within one year, and which shall include the amount of any loan by a member of a patronage refund or dividend; and

(c) the retained surplus or accumulated deficit of a credit union.

Matching.

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.

Insurance.

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 fund.

Adjustments.

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 equity 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 VI

MEMBERSHIP

Members.

52(1)

The membership of a credit union consists of its incorporators and those persons whose applications for membership are accepted by the directors in accordance with the provisions of this Act, the regulations, the articles and charter 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.

Persons under 18.

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.

Restriction.

52(4)

No credit union may be a member of another credit union.

Common bond.

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.

Leaving 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.

Associates.

54(1)

No credit union shall permit persons to become associates of a credit union, unless

(a) the credit union has provided for associate status in its articles;

(b) the credit union has enacted a charter by-law pursuant to clause 6(4)(a); and

(c) the central to which the credit union is assigned has enacted a charter by-law which permits persons to become associates of credit unions within its system.

Number of associates.

54(2)

At no time shall the number of associates exceed 1/4 of the number of members of the credit union.

Restriction.

54(3)

No credit union may be an associate of another credit union.

Rights of associate.

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.

Termination of membership.

55(1)

Unless the charter 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.

Notice to 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.

Notice of termination.

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.

Appeal to meeting of members.

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).

Decision of meeting.

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.

Appeal to Registrar.

55(7)

Subject to subsection (8), a person the termination of whose membership is confirmed by a meeting of members under subsection (5) or whose membership has been terminated by a meeting of members under subsection (6), may appeal the termination to the Registrar as prescribed, and the Registrar may confirm or set aside the resolution terminating the membership.

Exception.

55(8)

No person whose membership is terminated for failure to fulfill financial obligations to the credit union may appeal the termination to the Registrar under subsection (7).

Membership continues.

55(9)

A person who in accordance with subsection (4) or (7) 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) or by the Registrar under subsection (7), as the case may be.

Re-admittance.

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.

Non application.

55(11)

This section does not apply to associates.

Withdrawal.

56(1)

A member may withdraw from a credit union on such terms and conditions as this Act, the articles or the charter 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.

Remedy preserved.

57

Withdrawal from or termination of membership in a credit union does not release a person from any liability to the credit union.

Power to enact by-laws.

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 ordinary by-laws or charter by-laws in respect of those matters authorized or required by any provision of this Act.

Enactment

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.

Effective date of charter by-laws.

58(3)

A charter by-law, amendment or repeal thereof, is effective upon the approval of the Registrar or, in the event that the charter by-laws have been pre-cleared, upon enactment of the charter by-law by the credit union.

Effective date of ordinary by-laws.

58(4)

The enactment, amendment or repeal of an ordinary by-law is effective on, from and after the date of the members' approval.

Pre-clearance of charter by-laws.

58(5)

At the option of the credit union, a charter by-law and any amendment or repeal thereof may be submitted to the Registrar for approval prior to the adoption thereof by the members of the credit union, and

(a) the charter by-law must be adopted by the members of the credit union within 30 days of receipt of the approval of the Registrar; and

(b) a certified copy of the adopted charter by-law must be filed with the Registrar within 30 days of its adoption by the members of the credit union.

Failure to file on a timely basis.

58(6)

If a credit union fails to comply with the requirements of subsection (5), the charter by-law, amendment or repeal is void.

Members bound by articles and charter by-laws.

59

The articles and charter by- laws of a credit union bind the credit union and its members.

Place of meetings.

60

Meetings of the members of a credit union shall be held at the place within Manitoba provided in the charter by-laws or, in the absence of that provision, at the place within Manitoba that the directors may determine.

Calling meetings.

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.

Record date.

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.

Notice of meeting.

63(1)

Notice of the time and place of a meeting of members shall be given in accordance with the provisions of the charter by-laws or, in the absence of those provisions, shall be given not less than 14 days nor more than 30 days before the meeting to each member entitled to vote at the meeting, and to the auditor of the credit union.

Adjournment.

63(2)

Where a meeting of members is adjourned for less than 7 days, it is not necessary, unless the charter by-laws otherwise provide, to give notice of the adjourned meeting other than by announcement at the earliest meeting that is adjourned.

Notice of adjourned meeting.

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.

Business.

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 charter bylaws to be transacted at an annual meeting; is deemed to be special business.

Notice of 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.

Waiver of notice.

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.

Member proposal.

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.

Notice of 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.

Supporting statement.

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.

Nominations for directors.

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 charter by-laws of the credit union, but this subsection does not prevent nominations being made at any meeting of members.

Non-compliance.

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 prior to notice being given for the 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.

Immunity.

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.

Notice of refusal.

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.

Member application to court

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.

Registrar entitled to notice.

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.

Quorum.

66(1)

Unless the charter by-laws otherwise provide, a number of members equal to the number of directors plus 5, constitutes a quorum.

Opening quorum sufficient.

66(2)

If a quorum is present at the opening of a meeting of members, the members present may, unless the charter by-laws otherwise provide, proceed with the business of the meeting, notwithstanding that a quorum is not present throughout the meeting.

Adjournment.

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.

Non application.

66(4)

This section does not apply to associates.

Voting eligibility.

67(1)

A member of a credit union, 18 years of age or over, may vote at a meeting of members.

One member one vote.

67(2)

Subject to the provisions of subsection (1) and subsection 35(2), a member of a credit union has only one vote on any question that may be voted on at a meeting of the credit union.

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.

Powers of representative.

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.

Proxy.

69(1)

Unless the charter 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 charter 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.

Non application.

69(3)

This section does not apply to associates.

Joint membership.

70

A credit union may, in its charter 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.

Mail ballot

71

A credit union may, by charter by-law, establish procedures to permit members to vote by mail ballot.

Executors and administrators.

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.

Method of voting.

73(1)

Unless the charter 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.

Time for demanding ballot

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.

Members calling meetings.

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 charter 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.

Form of 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.

Directors calling meeting.

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).

Member calling meeting.

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.

Procedure.

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 charter by-laws.

Reimbursement.

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.

Meeting called by Registrar.

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 charter 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 of members of the credit union duly called and conducted.

Varying quorum.

75(2)

Without restricting the generality of subsection (1), the Registrar may order that the quorum required by the Act or the charter by-laws be varied or dispensed with at a meeting called, held and conducted pursuant to this section.

PART VII

DIRECTORS AND OFFICERS

Power to manage.

76(1)

The directors shall

(a) exercise the powers of the credit union directly, or indirectly through the employees and agents of the credit union; and

(b) direct the management of the business and affairs of the credit union.

Number of directors.

76(2)

The credit union may, by charter by-law, establish a fixed number, or a minimum and maximum number, of directors but in no event shall the number of directors be less than 5.

Qualifications of directors.

77

Any citizen of Canada who is 18 years of age, a member of the credit union and satisfies the requirements set out in the charter by-laws of the credit union except

(a) an undischarged bankrupt; or

(b) an employee of a credit union, a central or a fund; or

(c) an auditor, or a member of the auditor's firm, of that credit union; or

(d) the solicitor of that credit union; or

(e) a civil servant whose official duties are concerned with the affairs of credit unions; may be a director of the credit union.

Terms of office of first directors.

78(1)

Each director named in the articles holds office from the issue of the certificate of incorporation until the first meeting of members.

Election of directors.

78(2)

The members of a credit union shall, by ordinary resolution at the first meeting of the members and at each succeeding annual meeting of the members at which an election of directors is required, elect directors to hold office for a term established in the charter by-laws, which term shall not exceed 3 years.

Election of district directors.

78(3)

Notwithstanding the provisions of subsection (2) the charter by-laws of a credit union may provide the manner in which members of a credit union elect directors for a district at a district meeting.

Staggered terms.

78(4)

It is not necessary that all directors elected at a meeting of members hold office for the same term.

No stated terms.

78(5)

A director not elected for an expressly stated term ceases to hold office at the close of the first annual meeting of members following that director's election.

Incumbent directors.

78(6)

Notwithstanding anything in this section to the contrary, if directors are not elected at a meeting of the members, the incumbent directors continue in office until their successors are elected.

Ceasing to hold office.

79(1)

A director of a credit union ceases to hold office when he

(a) dies or resigns; or

(b) is removed from office in accordance with section 80; or

(c) becomes disqualified under section 77.

Effective date of resignation.

79(2)

The resignation of a director becomes effective at the time a written resignation is received by the credit union, or at the time specified in the resignation, whichever is later.

Removal of directors.

80(1)

The members of a credit union may, by ordinary resolution, at a special meeting remove any director from office.

Vacancy.

80(2)

A vacancy created by the removal of a director from office may be filled at the meeting of the members at which the director is removed or, if not so filled, may be filled under section 82.

Statement of director.

81(1)

A director who

(a) resigns; or

(b) receives a notice or otherwise learns of a meeting of members called for the purpose of removing him or her from office; or

(c) receives a notice or otherwise learns of a meeting of directors or members at which another person is to be appointed or elected to fill the office of director in his or her stead, whether because of his or her resignation or removal or because his or her term of office has expired or is about to expire; is entitled to submit to the credit union a written statement giving the reasons for the resignation or for opposing any action or resolution proposed for the purposes described in clauses (b) and (c).

Circulating statement

81(2)

A credit union shall forthwith send a copy of the statement referred to in subsection (1) to every member and to the Registrar.

Immunity.

81(3)

No credit union or person acting on its behalf incurs any liability by reason only of circulating a statement in compliance with subsection (2).

Filling vacancy.

82(1)

Subject to subsection (4), a quorum of directors may fill any vacancy among the directors, except a vacancy resulting from an increase in, or the members' failure to elect, the fixed or minimum number of directors.

Quorum may exercise powers.

82(2)

If a meeting of the members fails, for any reason, to elect the fixed or minimum number of directors, the directors elected at that meeting may exercise all the powers of directors if the number of directors so elected constitutes a quorum.

Calling meeting.

82(3)

If there is a failure to elect the fixed or minimum number of directors at a meeting of members, the directors then in office shall forthwith call a meeting of members to fill the vacancy and, if they fail to call a meeting or if there are no directors then in office, the meeting may be called by any member.

Members filling vacancy.

82(4)

The articles or charter by-laws may provide that a vacancy among the directors shall be filled only by a vote of the members.

Ratification.

82(5)

If a vacancy among the directors is filled pursuant to subsection (1), the appointment shall be ratified at the next meeting of members.

Notice of change of directors.

83(1)

Within 15 days after a change of directors occurs, a credit union shall send to the Registrar a notice in the prescribed form setting out the change, and the Registrar shall file the notice.

Application to court.

83(2)

Any interested person or the Registrar may apply to the court for an order requiring a credit union to comply with subsection (1), and upon the application the court may make the order and any further order it thinks fit.

Effect of notice.

83(3)

A director named in the articles or in a notice sent by the credit union to the Registrar pursuant to subsection (1) and filed by the Registrar is presumed for the purposes of this Act to be a director of the credit union referred to in the notice.

Meeting of directors.

84(1)

Unless the articles or charter by-laws otherwise provide, the directors of a credit union may meet at such place and upon such notice as the directors may determine.

Quorum.

84(2)

Unless the articles or charter by-laws otherwise provide, a majority of the directors constitutes a quorum at any meeting of directors and, notwithstanding any vacancy among the directors, a quorum of directors may exercise all the powers of the directors.

Notice of meeting.

84(3)

Unless the charter by-laws otherwise provide, a notice of a meeting of directors need not specify any matter that is to be dealt with at the meeting except

(a) any question or matter requiring the approval of the members; or

(b) the filling of a vacancy among the directors; or

(c) the issuance or redemption of any securities of the credit union other than common shares; or

(d) the approval of any financial statements of a kind referred to in section 98.

Waiver of notice.

84(4)

A director may in any manner waive notice of a meeting of directors and attendance of a director at a meeting of directors is a waiver of notice of the meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting was not lawfully called.

Adjournment

84(5)

Notice of an adjourned meeting of directors is not required to be given if the time and place of the adjourned meeting is announced at the original meeting.

Participation by telephone.

84(6)

Subject to the charter by-laws, a director may, if all the directors of the credit union consent, participate in a meeting of directors or of a committee of directors by means of such telephone or other communications facilities as permit all persons participating in the meeting to hear each other, and a director participating in the meeting by such means is deemed for the purposes of this Act to be present at that meeting.

Delegation.

85(1)

The directors of a credit union may appoint from their number a committee of directors and delegate to that committee any of the powers of the directors.

Authority of directors.

85(2)

Notwithstanding subsection (1), no committee of directors has authority to

(a) submit to the members any question or matter requiring approval of the members; or

(b) fill a vacancy among the directors; or

(c) issue or redeem securities, except in the manner and on the terms authorized by the directors; or

(d) approve any financial statement of a kind referred to in section 98.

Validity of act of directors and officers.

86

An act of a director or officer is valid, notwithstanding any irregularity in the election of or appointment or any defect in the qualifications of the director.

Resolution in lieu of meeting.

87(1)

A resolution in writing, signed by all the directors entitled to vote on that resolution at a meeting of directors or a committee of directors

(a) satisfies all requirements of this Act relating to meetings of directors or meetings of committees of directors, as the case may be;

(b) is as valid as if it had been passed at a meeting of directors or of a committee of directors, as the case may be; and

(c) is effective from the date specified in the resolution, which shall not be prior to the date on which the first director signed the resolution.

Filing resolution.

87(2)

A copy of every resolution referred to in subsection (1) shall be kept with the minutes of the proceedings of the directors or committee of directors, as the case may be.

Liability of directors.

88(1)

Directors of a credit union who vote for or consent to a resolution authorizing a payment contrary to sections 30 and 32, or the payment of an indemnity contrary to section 96, are jointly and severally liable to restore to the credit union any amount so distributed or paid and not otherwise recovered by the credit union.

Liability for loans.

88(2)

Where a loan or advance is made by a credit union to any member thereof in violation of this Act or the regulations, the person receiving the loan or advance and all directors and other officers and members of committees of the credit union who, with knowledge of the violation, make or approve the loan or advance, are jointly and severally liable to the credit union for the unpaid balance of the loan or advance with interest.

Contribution.

88(3)

A director, officer, or member of a committee, who satisfies a judgment rendered under this section or pursuant to The Payment of Wages Act is entitled to contribution from all other persons who, by virtue of this Act or The Payment of Wages Act, are also liable.

Recovery.

88(4)

A director, officer, or member of a committee who is liable under subsection (1) or (2) may apply to the court for an order compelling a member or other recipient to pay any money or deliver any property to the director, officer or member of a committee that was improperly paid or distributed to the member or other recipient.

Limitations.

88(5)

Any action to enforce a liability imposed by subsections (1) and (2) may not be commenced after 2 years from the date of the resolution authorizing the thing complained of.

Payment of Wages Act to apply.

89

The Payment of Wages Act applies to credit unions and their directors and officers.

Duty of directors to report.

90

Where any director of a credit union becomes aware that

(a) the credit union is unable to make any lawful payment it is required to make, except with the result that

(i) the credit union would after that payment be unable to pay its liabilities as they become due, or

(ii) the realizable value of the credit union's assets would thereby be less than the aggregate of its liabilities and the capital account of all classes of shares of the credit union other than common shares; or

(b) the credit union is financially unsound or conducting its affairs in a manner that tends to increase the risk of a claim upon the fund; the director shall within 7 days give written notice thereof to the Registrar.

Definition.

91(1)

Without in any way limiting those matters which may be considered to be material in nature a "material contract" in this section includes a contract of any kind made by a credit union under which it

(a) employs a person as a full time employee, or

(b) retains the service of a person otherwise than as an employee, or

(c) disposes of or acquires property whether by sale, purchase, lease or otherwise, for consideration that exceeds $5,000. in value.

Interest in contracts of relatives.

91(2)

A director or officer shall be deemed to have a material interest in any material contract in which any of the following persons is a party or in which they have a material interest:

(a) the spouse of the director or officer; or

(b) the parent, child, grandparent, grandchild, brother or sister of the director or officer or of the spouse of the director or officer; or

(c) the spouse of any person mentioned in clause (b).

Interest in contracts of others.

91(3)

A director or officer shall be deemed to have a material interest in any material contract involving another person where the director or officer is

(a) a creditor of that person for a debt that is in excess of $5,000.; or

(b) a guarantor of the debts of that person in an amount that is in excess of $5,000.; or

(c) the owner or beneficial owner of not less than 20% of the issued shares of any class of shares of that person; or

(d) a partner of that person; or

(e) a member along with that person in any association; or

(f) a director or officer of that person.

Officer defined.

91(4)

In this section "officer" includes a committee member, general manager, or agent of a credit union.

Exceptions.

91(5)

For purposes of this section, a material contract does not include

(a) an arrangement by way of security for money lent to or obligations undertaken by a director, officer or employee of the credit union for the benefit of the credit union; or

(b) a contract relating primarily to the remuneration of directors, or officers of the credit union; or

(c) a contract for indemnity or insurance under section 96; or

(d) loans made to directors, officers or employees in the ordinary course of the credit union's business and in compliance with the Act and the regulations, the charter by-laws, and the loan policies of the credit union.

Disclosure.

91(6)

A director or officer of a credit union who

(a) is a party to a material contract or proposed material contract with the credit union; or

(b) has a material interest in a contract or proposed contract between a person and the credit union; shall be deemed to have a conflict of interest with the credit union and shall disclose in writing to the credit union and request to have entered in the minutes of meetings of directors, the nature and extent of the interest and shall not participate in any vote conducted by the directors or of a committee of the credit union relating to the material contract or proposed material contract.

Time of disclosure for director or officer.

91(7)

A director or officer shall make the disclosure required by subsection (6) forthwith upon the director or officer becoming aware of the conflict of interest.

Continuing disclosure.

91(8)

For the purposes of this section, general notice to the directors by a director or officer, declaring that he or she is a director or officer of or is to be regarded as having a material interest in any contract made with a person, is a sufficient declaration of interest in relation to any contracts so made.

Avoidance standards.

91(9)

A contract or transaction in which a director or officer has a conflict of interest, is neither void nor voidable by reason only of that conflict of interest or by reason only that a director with a conflict of interest is present at or is counted to determine the presence of a quorum of a meeting of directors or a committee of directors that authorized the contract or transaction, if the director or officer disclosed the conflict of interest in accordance with this section, did not participate in the vote to authorize such contract or transaction, and the contract or transaction was approved by the directors or the members and it was reasonable and fair to the credit union at the time it was approved.

Approval by members.

91(10)

When a director votes on a resolution in which the director has declared a conflict of interest, the contract or transaction that is the subject of the resolution will only be valid if it is approved by not less than 2/3 of the votes cast by the members at a special meeting of the credit union.

Application to court.

91(11)

Where a director or officer of a credit union fails to disclose a conflict of interest in accordance with this section or participates in a vote which is not subsequently ratified by the members, the court may, upon the application of the credit union or a member of the credit union, set aside the contract or transaction on such terms as it sees fit.

Failure to disclose.

91(12)

Any director or officer of a credit union who, without reasonable cause, fails to disclose a conflict of interest in accordance with this section is guilty of an offence and liable on summary conviction to a fine not exceeding $5,000., and such director or officer, on conviction, shall cease to hold office and shall not be eligible for election as a director or for appointment as an officer of a credit union for a period of 5 years after the date of the conviction.

Officers.

92

Subject to the articles and charter by-laws,

(a) the directors may designate the officers of the credit union, elect or appoint as officers persons of full capacity, specify their duties and delegate to them powers to manage the business and affairs of the credit union except powers to

(i) submit to the members any question matter requiring the approval of the members, or

(ii) fill a vacancy among the directors, or

(iii) issue or redeem securities, except in the manner and on the terms authorized by the directors, or

(iv) approve any financial statements of a kind referred to in section 98;

(b) the directors may elect or appoint committees and delegate powers, duties and responsibilities to them, except powers to do anything referred to in clause (a);

(c) a director may become an officer of the credit union and may become a member of a committee; and

(d) 2 or more offices of the credit union may be held by the same person.

Remuneration.

93

Subject to the articles and the by-laws, the directors of a credit union may fix the remuneration of the directors, officers, committee members, delegates and employees of the credit union.

Duty of care of directors and officers.

94(1)

Every director and officer of a credit union, in exercising the powers and discharging the duties of a director or officer shall

(a) act honestly and in good faith with the view to the best interest of the credit union; and

(b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

Duty to comply.

94(2)

Every director and officer of a credit union shall comply with this Act and the regulations, and the articles and charter by-laws of the credit union.

No exculpation.

94(3)

No provision in a contract, the articles, the by-laws or a resolution relieves a director or officer from the duty to act in accordance with this Act and the regulations or relieves the director or officer from liability for a breach thereof.

Interpretation.

94(4)

This section is in addition to and not a derogation of any other enactment or rule of law relating to the duty or liability of directors or officers of a credit union.

Dissent.

95(1)

A director who is present at a meeting of directors is deemed to have consented to any resolution passed or action taken thereat, unless the director

(a) requests that the director's dissent be or the dissent is entered in the minutes of the meeting; or

(b) sends a written dissent to the secretary of the meeting before the meeting is adjourned; or

(c) sends a dissent by registered mail to the registered office of the credit union immediately after the meeting is adjourned.

Loss of right to dissent

95(2)

A director who votes for or consents to a resolution is not entitled to dissent under subsection (1).

Dissent of absent director.

95(3)

A director who was not present at a meeting at which a resolution was passed or action taken is deemed to have consented thereto, unless within 7 days after becoming aware of the resolution the director

(a) causes his or her dissent to be placed with the minutes of the meeting; or

(b) sends a dissent by registered mail it to the registered office of the credit union.

Reliance of statements.

95(4)

A director who relies in good faith upon (a) financial statements of the credit union represented by an officer of the credit union represented by an officer or the auditor of the credit union to reflect fairly the financial condition of the credit union; or

(b) the report of a lawyer, accountant, engineer, appraiser or any other person whose profession lends credibility to any statement made by him or her; is not liable under section 88.

Indemnification.

96(1)

Except in the case of an action by or on behalf of the credit union or body corporate to procure a judgment in its favour, or by or on behalf of the Registrar or the fund under section 208, in which case the approval of the court must first be obtained, a credit union may indemnify a director or officer of the credit union or a person who acts or acted at the credit union's request as a director or officer of a body corporate of which the credit union is or was a member, shareholder or creditor, and his or her heirs and legal representatives, against all costs, charges and expenses, including any amount paid to settle an action or satisfy a judgment, reasonably incurred by him or her in respect of any civil, criminal or administrative action or proceeding to which he or she is made a party by reason of being or having been a director or officer of the credit union or body corporate, if the director or officer

(a) acted honestly and in good faith with a view to the best interests of the credit union; and

(b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, had reasonable grounds for believing the conduct was lawful.

Right to indemnity.

96(2)

Notwithstanding anything in this section, a person referred to in subsection (1) is entitled to indemnity from the credit union in respect of all costs, charges and expenses reasonably incurred in connection with the defence of any civil, criminal or administrative action or proceeding to which that person is made a party by reason of being or having been a director or officer of a credit union or body corporate if the person seeking indemnity

(a) was substantially successful on the merits in defence of the action or proceeding; and

(b) fulfills the conditions set out in clauses (1)(a) and (b).

Insurance for directors and officers.

96(3)

A credit union may purchase and maintain insurance for the benefit of any person referred to in subsection (1) against any liability incurred by that person

(a) as a director or officer of the credit union except where the liability relates to the failure of that person to act honestly and in good faith with a view to the best interests of the credit union; and

(b) as a director or officer of another body corporate where he acts or acted in that capacity at the credit union's request except where the liability relates to the failure to act honestly and in good faith with a view to the best interests of the body corporate.

Application to court.

96(4)

A credit union or a person referred to in subsection (1) may apply to the court for an order approving an indemnity under this section, and the court may so order and make any further order it thinks fit.

Notice to Registrar.

96(5)

An applicant under subsection (4) shall give the Registrar and the fund notice of the application, and the Registrar and the fund are entitled to appear and be heard in person or by counsel.

Other notice.

96(6)

Upon an application under subsection (4), the court may order notice to be given to any interested person and that person is entitled to appear and be heard in person or by counsel.

PART VIII

RETURNS AND FINANCIAL DISCLOSURE

Returns.

97(1)

Every credit union shall, on or before June 30th in each year, complete and file a return with the Registrar showing, as at March 31st of that year,

(a) the name of the credit union;

(b) the address of the registered office of the credit union, giving the street and number on the street;

(c) the date when the latest annual meeting of the members of the credit union was held;

(d) the names, principal occupations and addresses of the directors of the credit union, giving the street and number on the street;

(e) the names and addresses of the officers including the manager, of the credit union, giving the street and number on the street; and

(f) such other information relating to the credit union as may be required by this Act and the Registrar.

Certification.

97(2)

The return shall be in a form prescribed by the Registrar and shall be signed and the contents thereof certified to be true by a director or officer of the credit union.

Other returns.

97(3)

In addition to the return required under subsection (1), the Registrar may require a credit union to file within a set time a return containing such other information as the Registrar considers necessary.

Fees.

97(4)

The regulations may prescribe a filing fee payable by a credit union to the Registrar upon the filing of a return under this section, and additional fees for late filing.

Annual financial statements.

98(1)

At each annual meeting of members of a credit union, the directors shall place before the members,

(a) financial statements, as prescribed, for the period that began on the date the credit union came into existence and ended not more than 4 months before the annual meeting, or if the credit union has completed a financial year the period that began immediately after the end of the last completed financial year and ended not more than 4 months before the annual meeting;

(b) the report of the auditor; and

(c) any further information respecting the financial position of the credit union and the results of its operations required by this Act or the regulations or the articles or charter by-laws of the credit union.

Directors' and officers' disclosure.

98(2)

At each annual meeting of members of a credit union, the directors shall disclose

(a) the aggregate amount of remuneration paid to all directors;

(b) the aggregate amount paid to all directors as reimbursement for expenses incurred on credit union business; and

(c) the details of any loans made to directors or officers and to any persons in whom directors or officers have a material interest, which do not conform to the credit union's ordinary lending practices for members who are not directors or officers.

Condition precedent to issue.

99

A credit union shall not issue, publish or circulate copies of the financial statements referred to in section 98, unless the financial statements are

(a) approved by the directors, and the approval is evidenced by the signatures of 2 or more of the directors on the statements; and

(b) accompanied by the report of the auditor of the credit union.

Request for documents.

100

A credit union shall, at any time on the request of a member, make available to that member a copy of the documents referred to in section 98.

Submission to Registrar and fund.

101(1)

A credit union shall, before each annual meeting of members, send a copy of the documents referred to in section 98 to the Registrar and to the fund.

Submission to fund.

101(2)

A credit union shall, at all times, upon request, provide to the fund such other information which the fund may reasonably require to enable the fund to discharge its responsibilities under the Act.

Appointment of auditor.

102(1)

At each annual meeting of a credit union the members of the credit union shall appoint, from a list of approved auditors prepared by the fund, auditors for the credit union.

Annual audit.

102(2)

The auditor of a credit union shall conduct, on an annual basis, the audit of a credit union and shall make such inquiries as are necessary in the auditor's opinion to enable the auditor to report on the financial status of the credit union.

Disqualification of auditor.

102(3)

Subject to subsection (7), a person who is not independent of the credit union or of the directors or officers of the credit union is disqualified from being an auditor of a credit union.

Independence.

102(4)

For the purposes of this section,

(a) independence is a question of fact;

(b) a person is deemed not to be independent of the credit union if that person or his or her business partner

(i) is a business partner, director, officer or employee of the credit union or of any director, officer or employee of the credit union, or

(ii) is indebted to the credit union at the time an audit is performed.

Duty to resign.

102(5)

An auditor who becomes disqualified under this section shall, subject to subsection (7), resign forthwith after becoming aware of the disqualification.

Disqualification order.

102(6)

Notwithstanding subsection (7), any interested person may apply to the court for an order declaring an auditor to be disqualified under this section and the office of auditor to be vacant.

Exemption order.

102(7)

Any interested person may apply to the Registrar for an order exempting an auditor from disqualification under this section, and the Registrar may, if satisfied that an exemption would not unfairly prejudice the members, make an exemption order on such terms as the Registrar thinks fit, and may make the order with retroactive effect.

Ceasing to hold office.

103(1)

An auditor of a credit union ceases to hold office on

(a) death or resignation; or

(b) removal from office pursuant to subsection 102(6) or 104(1).

Effective date of resignation.

103(2)

A resignation of an auditor becomes effective at the time a written resignation is sent to the credit union, or at the time specified in the resignation, whichever is later.

Removal of auditor.

104(1)

The members of a credit union may, at a special meeting, remove from office and replace any auditor appointed by them.

Notice of meeting.

104(2)

Notice of a meeting called for the purpose of removing an auditor from office shall be given to the fund and the fund is entitled to be represented and be heard at such meeting.

Filling vacancy.

105(1)

Subject to subsection (3), the directors shall forthwith fill any vacancy in the office of auditor.

Calling meeting.

105(2)

If there is not a quorum of directors, the directors then in office shall, within 21 days after a vacancy in the office of auditor occurs, call a special meeting of members to fill the vacancy and, if they fail to call a meeting or if there are no directors, the meeting may be called by any member.

Members filling vacancy.

105(3)

The charter by-laws of a credit union may provide that a vacancy in the office of auditor shall only be filled by a vote of the members.

Unexpired term.

105(4)

An auditor appointed to fill a vacancy holds office for the unexpired term of his predecessor.

Court appointed auditor.

106

If a credit union does not have an auditor, the court may, upon the application of a member or the Registrar, appoint and fix the remuneration of an auditor and the auditor so appointed holds office until an auditor is appointed by the members.

Right to attend meeting.

107(1)

The auditor of a credit union is entitled to receive notice of every meeting of members and of the audit committee and to attend and be heard thereat on matters relating to the auditor's duties.

Duty to attend meeting.

107(2)

Where a director or member of a credit union gives written notice, not less than 10 days before a meeting of members, to the auditor or a former auditor of the credit union, the auditor or former auditor shall attend the meeting at the expense of the credit union and answer questions relating to the auditor's or former auditor's duties as auditor of the credit union.

Notice to credit union.

107(3)

A director or member who gives a notice under subsection (2) shall send concurrently a copy of the notice to the credit union.

Offence.

107(4)

An auditor or former auditor of a credit union who fails without reasonable cause to comply with subsection (2) is guilty of an offence and liable on summary conviction to a fine not exceeding $5,000. or imprisonment for a term not exceeding 6 months, or to both.

Statement of auditor.

108(1)

An auditor who

(a) resigns; or

(b) receives a notice or otherwise learns of a meeting of members called for the purpose of removing that auditor from office; or

(c) receives a notice or otherwise learns of a meeting of directors or members at which another person is to be appointed to fill the office of auditor, whether because of the resignation or removal of the incumbent auditor or because the auditor's term of office has expired or is about to expire; is entitled to submit to the credit union a written statement giving the reasons for the resignation or opposing any proposed action or resolution.

Circulating statement.

108(2)

The credit union shall forthwith send a copy of the statement referred to in subsection (1) to every member entitled to receive notice of any meeting referred to in subsection 107(1) and to the fund.

Replacing auditor.

108(3)

No person shall accept an appointment or consent to be appointed as an auditor of a credit union to replace an auditor who has resigned, been removed or whose term has expired or is about to expire until that person has requested and received from that auditor a written statement of the circumstances and the reason why, the auditor is to be replaced.

Exception.

108(4)

Notwithstanding subsection (3), a person otherwise qualified may accept an appointment or consent to be appointed as auditor of a credit union if, within 15 days after making the request referred to in that subsection, no reply is received.

Effect of non-compliance.

108(5)

Unless subsection (4) applies, the appointment of an auditor of a credit union of a person who has not complied with subsection (3) is void.

Report to fund.

109(1)

The fund may require the auditor to report to it upon the adequacy of the procedure adopted by the credit union for the safety of the creditors and members of the credit union and as to the sufficiency of the auditor's own procedure in auditing the affairs of the credit union.

Scope of audit.

109(2)

The Registrar may, upon request of the fund, enlarge or extend the scope of the audit or direct any other or particular examination to be made or procedure to be established in any particular case as, in the Registrar's opinion, the public interest may require.

Right to information.

110(1)

Upon the demand of an auditor of a credit union, the present or former directors, officers, committee members, employees or agents of the credit union or its subsidiary shall furnish such

(a) information and explanations; and

(b) access to records, documents, books, accounts and vouchers of the credit union; as are, in the opinion of the auditor, necessary to enable the auditor to make the examination and report required under section 98 and as the directors, officers, committee members, employees or agents are reasonably able to furnish.

Information from subsidiaries.

110(2)

Upon the demand of the auditor of a credit union, the directors of the credit union shall obtain from the present or former directors, officers, employees and agents of any subsidiary of the credit union and furnish to the auditor any information or explanations that the present or former directors, officers, employees and agents of the subsidiary are reasonably able to furnish and that, in the opinion of the auditor, is necessary to enable the auditor to make the examination or report required under section 98.

Audit committee.

111(1)

A credit union may and, if so prescribed or if the charter by-laws so require, shall have an audit committee composed of not less than 3 directors of the credit union, a majority of whom are not officers of the credit union.

Directors to act as audit committee.

111(2)

If the credit union is not, pursuant to the regulations or the charter by-laws, required to establish an audit committee then the directors of the credit union shall perform the functions and duties of the audit committee.

Duty of committee.

111(3)

An audit committee shall review the financial statements of the credit union, shall meet at least annually with the auditor to review the financial performance of the credit union, and shall perform such other functions as may be prescribed.

Calling meeting.

111(4)

The auditor of a credit union or a member of the audit committee may call a meeting of the committee.

Notice of errors.

111(5)

A director or an officer of a credit union shall forthwith upon becoming aware of any error or misstatement in a financial statement that the auditor or a former auditor has reported upon notify the audit committee and the auditor.

Error in financial statements.

111(6)

An auditor or former auditor of a credit union who is notified or becomes aware of an error or misstatement in a financial statement that the auditor has reported upon, shall if in the auditor's opinion the error or misstatement is material, inform each director accordingly.

Duty of directors.

111(7)

Where under subsection (6) the auditor or former auditor informs the directors of an error or misstatement in a financial statement, the directors shall

(a) prepare and issue a revised financial statement; and

(b) otherwise inform the members, the Registrar and the fund.

Offence.

111(8)

Every director and every officer of a credit union who knowingly fails to comply with subsection (5) or (7) is guilty of an offence and is liable on summary conviction to a fine not exceeding $5,000. or to imprisonment for a term not exceeding 6 months, or to both.

Duty of auditor to manager and directors.

112(1)

It is the duty of the auditor to report to the manager, the audit committee and directors of the credit union in writing any transactions or conditions affecting the well-being of the credit union that in the auditor's opinion are not satisfactory and require rectification and, without restricting the generality of this requirement, the auditor shall as occasion requires make a report to the audit committee with respect to

(a) any transactions of the credit union that in the opinion of the auditor have not been within the powers of the credit union; and

(b) any unsound financial practices, transactions, or policies that in the auditor's opinion may contribute to losses by the credit union.

Procedure.

112(2)

An auditor who makes a report under subsection (1), shall transmit it in writing to the manager, audit committee and directors of the credit union and the report shall be presented to the meeting of directors next ensuing after it is received, and it shall be incorporated in the minutes thereof and the auditor shall, at the time of transmitting the report, furnish a copy of the report to the fund.

Qualified privilege.

113

Any oral or written statement or report made under this Act by the auditor of a credit union has qualified privilege.

PART IX

FUNDAMENTAL CHANGES

Amendment of articles.

114(1)

Subject to the approval of the Registrar under section 116, the articles of a credit union may be amended by special resolution of the members to

(a) change its name; or

(b) change the location of the registered office in Manitoba; or

(c) add, change or remove any restriction upon the business that the credit union may carry on; or

(d) change any maximum number of shares that the credit union is authorized to issue and change, if desired, the maximum consideration for which the shares may be issued; or

(e) create new classes of shares; or

(f) change the designation of all or any of its shares, and add, change or remove any rights, privileges, restrictions and conditions, including rights to accrued dividends, in respect of all or any of its shares, whether issued or unissued; or

(g) change the shares of any class, whether issued or unissued, into a different number of shares of the same class or into the same or a different number of shares of other classes; or

(h) add, change or remove restrictions on the transfer of shares; or

(i) add, change or remove any other provision that is permitted by this Act to be set out in the articles.

Clerical errors.

114(2)

The articles of a credit union containing a clerical error may be amended by resolution of the directors or by ordinary resolution of the members to correct the error.

Filing articles of amendment

114(3)

Where the articles of a credit union are amended under this section, articles of amendment shall, within 6 months of the date of the resolution of the members authorizing the amendment, be sent to the Registrar for filing and the Registrar shall refuse to file the articles if not so sent.

Revocation of amending resolution.

114(4)

The directors of a credit union may, if authorized by the members in any resolution effecting an amendment under this section, revoke the resolution before it is acted upon without further approval of the members.

Articles sent to Registrar.

115

Subject to any revocation under subsection 114(4), after an amendment is adopted under subsection 114(1), articles of amendment in prescribed form shall be sent to the Registrar.

Certificate of amendment

116

Upon receiving articles of amendment, the Registrar may, if satisfied that the amendment is advisable and subject to section 127, file the articles and issue a certificate of amendment in accordance with section 228.

Effect of certificate.

117(1)

An amendment becomes effective on the date shown on the certificate of amendment, and the articles are amended accordingly.

Existing rights preserved.

117(2)

No amendment to the articles of a credit union affects any existing cause of action, claim or liability to prosecution in favour of or against the credit union or any of its directors, committee members or officers or any civil, criminal or administrative action or proceeding to which the credit union or any of its directors, committee members, or officers is a party.

Restated articles.

118(1)

The directors may at any time, and shall when so directed by the Registrar, restate the articles of incorporation as amended.

Articles sent to Registrar.

118(2)

Restated articles of incorporation, in prescribed form, shall be sent to the Registrar.

Restated certificate.

118(3)

Upon receipt of restated articles of incorporation, the Registrar shall issue a restated certificate of incorporation in accordance with section 228.

Effect of certificate.

118(4)

Restated articles of incorporation are effective on, from and after the date shown in the restated certificate of incorporation and supersede the original articles of incorporation and all amendments thereto.

Amalgamation.

119(1)

Two or more credit unions may amalgamate and continue as one credit union.

Consent of supervisor.

119(2)

A credit union that is under supervision shall not amalgamate without the consent of its supervisor.

Amalgamation agreement.

120

Credit unions proposing to amalgamate shall enter into an agreement with each other setting out the terms and means of effecting the amalgamation and, in particular, setting out

(a) the provisions that are required to be included in the articles of incorporation;

(b) the address of the registered office of the amalgamated credit union;

(c) the name and address of each proposed director of the amalgamated credit union;

(d) the manner in which the shares of each amalgamating credit union are to be converted into shares or other securities of the amalgamated credit union;

(e) if any shares of an amalgamating credit union are not to be converted into shares or other securities of the amalgamated credit union, the amount of money or securities that the holders of those shares are to receive in addition to or instead of securities of the amalgamated credit union;

(f) the proposed charter by-laws of the amalgamated credit union; and

(g) details of any arrangements necessary to perfect the amalgamation and to provide for the subsequent management and operation of the amalgamated credit union.

Member approval of amalgamation agreement.

121(1)

The directors of each amalgamating credit union shall submit the amalgamation agreement for approval to a meeting of the members thereof.

Notice of meeting.

121(2)

A notice of a meeting of members shall be sent in accordance with section 63 to each member of each amalgamating credit union and shall

(a) include or be accompanied by a copy or summary of the amalgamation agreement; and

(b) state that a member is entitled to dissent in accordance with section 127.

Adoption of agreement.

121(3)

An amalgamation agreement is adopted when the members of each amalgamating credit union have approved the amalgamation by a special resolution.

Termination of agreement.

121(4)

An amalgamation agreement may provide that at any time before the issue of a certificate of amalgamation, the agreement may be terminated by the directors of any of the amalgamating credit unions.

Articles of amalgamation.

122(1)

Subject to subsection 121(4), after an amalgamation has been adopted under section 121, articles of amalgamation in prescribed form shall be sent to the Registrar.

Attached declarations.

122(2)

The articles of amalgamation shall have attached thereto a statutory declaration of a director or an officer of each amalgamating credit union that establishes to the satisfaction of the Registrar that

(a) there are reasonable grounds for believing that

(i) each amalgamating credit union is, and the amalgamated credit union will be, able to pay its liabilities as they become due, and (ii) the realizable value of the assets of the amalgamated credit union upon completion of the amalgamation will not be less than the aggregate of its liabilities and capital account of all shares of the credit union other than common shares; and

(b) there are reasonable grounds for believing that

(i) no creditors and shareholders of the amalgamating credit unions who are not members thereof, will be prejudiced by the amalgamation, or

(ii) adequate notice has been given to all known creditors of the amalgamating credit unions and no creditor objects to the amalgamation otherwise than on grounds that are frivolous or vexatious.

Exemption from declaration.

122(3)

The Registrar may exempt a credit union from the requirements of clause (2)(a) if the fund consents to the amalgamation.

Adequate notice to creditors.

122(4)

For the purposes of subsection (2), adequate notice is given if

(a) a notice in writing is sent to each known creditor having a claim against the credit union that exceeds $1,000.;

(b) a notice is published in The Manitoba Gazette and once in a newspaper published or distributed in a place where each amalgamating credit union has its registered office; and

(c) each notice states that the credit union proposes to amalgamate with one or more specified other credit unions in accordance with this Act unless a creditor of the credit union objects to the amalgamation within 30 days from the date of the notice.

Compulsory amalgamation.

123

Where a credit union which is under supervision is ordered by its supervisor to amalgamate pursuant to section 214, the provisions of section 121 and subsection 122(2) shall not apply to the credit union which is ordered to amalgamate.

Certificate of amalgamation.

124(1)

Upon receiving articles of amalgamation, the Registrar may, if satisfied that the amalgamation is advisable and subject to section 127, file the articles and issue a certificate of amalgamation in accordance with section 228.

Effect of certificate of amalgamation.

124(2)

On the date shown in the certificate of amalgamation,

(a) the amalgamation of the amalgamating credit unions and their continuance as one credit union becomes effective;

(b) the property of each amalgamating credit union continues to be the property of the amalgamated credit union;

(c) the amalgamated credit union continues to be liable for the obligations of each amalgamating credit union;

(d) any existing cause of action, claim or liability to prosecute remains unaffected;

(e) any civil, criminal or administrative action or proceeding pending by or against any of the amalgamating credit unions may be continued by or against the amalgamated credit union;

(f) any conviction against or any ruling, order or judgment in favour of or against any of the amalgamating credit union may be enforced by or against the amalgamated credit union;

(g) the articles of amalgamation are deemed to be the articles of incorporation of the amalgamated credit union and the certificate of amalgamation is deemed to be the certificate of incorporation of the amalgamated credit union;

(h) on the filing of a copy of the certificate of amalgamation, certified as a true copy by the Registrar, in any land titles, registry or other recording office, all the lands, charges on land, estates, properties, real, personal or mixed, charges on personal property, effects, rights, credits, judgments, assignments, choses in action of every description belonging to the amalgamating credit unions are transferred and vested in the amalgamated credit union without further act, conveyance or other deed; and

(i) the members of the amalgamating credit unions become members of the amalgamated credit union and the shares held by them in the amalgamating credit unions become shares in the amalgamated credit union subject to the terms of the amalgamation agreement.

Extraordinary sale, lease or exchange.

125(1)

A sale, lease or exchange of all or substantially all of the property of a credit union, requires the approval of the members in accordance with this section.

Notice of meeting.

125(2)

A notice of a meeting of members shall be sent in accordance with section 63 to each member and shall

(a) include or be accompanied by a copy or summary of the agreement of sale, lease or exchange; and

(b) state that a member is entitled to dissent in accordance with section 127.

Terms and conditions of sale, lease or exchange.

125(3)

At the meeting referred to in subsection (2), the members may by special resolution approve the sale, lease or exchange and may fix or authorize the directors to fix any of the terms and conditions thereof.

Approval of sale, lease or exchange.

125(4)

A sale, lease or exchange referred to in subsection (1) is adopted when the members have approved the sale, lease or exchange.

Termination.

125(5)

The directors of a credit union may, if so authorized by the members approving a proposed sale, lease or exchange and subject to the rights of third parties, abandon the sale, lease or exchange without further approval of the members.

Approval of Registrar.

126(1)

The credit union shall, prior to completion of a sale, lease or exchange referred to in section 125, obtain the approval of the Registrar.

Declaration.

126(2)

An approval shall not be granted under subsection (1) unless the Registrar has received a statutory declaration of a director or officer of the credit union proposing to sell, lease or exchange its property establishing to the satisfaction of the Registrar that there are reasonable grounds for believing that

(a) the sale, lease or exchange of the property will not increase the likelihood of a claim upon the fund;

(b) no creditors, including shareholders of the credit union who are not members, will be prejudiced by the sale, lease or exchange of the property; and

(c) adequate notice has been given to all known creditors of the credit union and no creditor objects to the sale, lease or exchange of the property otherwise than on grounds that are frivolous or vexatious.

Adequate notice to creditors.

126(3)

For the purposes of subsection (2), adequate notice is given if

(a) a notice is published once in The Manitoba Gazette and once in a newspaper published or distributed in the place where the credit union has its registered office; and

(b) each notice states that the credit union proposes to sell, lease or exchange all, or substantially all, of its property, as the case may be, pursuant to section 125, unless a creditor of the credit union objects to the sale, lease or exchange within 30 days from the date of the notice.

Bulk Sales Act

126(4)

The Bulk Sales Act does not apply to a sale, lease or exchange of the property of a credit union.

Right to dissent

127(1)

Subject to sections 128 and 194, a member of a credit union may dissent if the credit union resolves to

(a) change its name; or

(b) amalgamate with another credit union, pursuant to section 121; or

(c) sell, lease or exchange all or substantially all its property under section 125; or

(d) add, change or remove any provision that is set out in the articles.

Objection in writing.

127(2)

A dissenting member shall send to the credit union, at or before any meeting of members at which a resolution referred to in subsection (1) is to be voted on, a written objection to the resolution, but where the dissenting member fails to send the written objection as required the dissenting member does not thereby lose the right to dissent if the credit union failed to give the dissenting member notice of the purpose of the meeting or of the right to dissent.

Notice to members and Registrar.

127(3)

The credit union shall, within 10 days after the members adopt the resolution,

(a) send to each member who has filed an objection under subsection (2) a notice that the resolution has been adopted, but notice is not required to be sent to any member who withdraws an objection; and

(b) send to the Registrar a copy of the resolution and copies of any written objections received by the credit union under subsection (2).

Approval of Registrar.

127(4)

No resolution in respect of which written objection has been sent to the credit union under subsection (2) shall be effective until approved by the Registrar.

Conditions.

127(5)

The Registrar may require as a condition of approval under subsection (4) that a part or all of the indebtedness or other liability of the credit union to the dissenting member be paid or satisfied on such terms as the Registrar may stipulate.

"Reorganization" defined.

128(1)

In this section, "reorganization" means the reorganization of a credit union pursuant to a court order made under

(a) section 194; or

(b) the Bankruptcy Act (Canada), approving a proposal; or

(c) any other Act of the Legislature that affects the rights of the credit union, its members or creditors.

Power of court.

128(2)

Where a credit union is subject to an order referred to in subsection (1), its articles may be amended by the order to effect any change that might lawfully have been made by an amendment under section 114.

Further powers.

128(3)

Where a court makes an order referred to in subsection (1), the court may also

(a) authorize the issue of debt obligations of the credit union and fix the terms thereof; and

(b) appoint directors in place of or in addition to all or any of the directors then in office.

Articles of reorganization.

128(4)

After an order referred to in subsection (1) has been made, articles of reorganization in prescribed form shall be sent to the Registrar.

Certificate of amendment.

128(5)

Upon the receipt of articles of reorganization, the Registrar shall file the articles and issue a certificate of amendment in accordance with section 228.

Effect of certificate of amendment.

128(6)

A reorganization becomes effective on the date shown in the certificate of amendment, and the articles of incorporation are amended accordingly.

No dissent.

128(7)

A member is not entitled to dissent under this section.

Extra-provincial credit unions in Manitoba.

129

A credit union incorporated under the laws of a jurisdiction other than Manitoba may, if so authorized by the laws of that jurisdiction and upon filing with the Registrar such documents and other materials as the Registrar may require, become registered in Manitoba for certain limited purposes approved by the Registrar, but in no case shall the credit union be permitted to carry on in Manitoba the ordinary business of deposits and loans.

Extra-provincial Registration.

130

With the approval of the Registrar a credit union may register to carry on business under the laws of a jurisdiction other than Manitoba.

PART X

DISSOLUTION, LIQUIDATION AND REVIVAL

Dissolution before commencing business.

131(1)

A credit union that has not issued any shares may be dissolved at any time by resolution of all the directors.

Dissolution if no property.

131(2)

A credit union that has no property and no liabilities may be dissolved by special resolution of the members and, where it has issued more than one class of shares, other than surplus shares, by special resolutions of the holders of each class of shares, whether or not they are otherwise entitled to vote.

Dissolution where property disposed of.

131(3)

A credit union that has property or liabilities or both may be dissolved by special resolution of the members and, where it has issued more than one class of shares, other than surplus shares, by special resolutions of the holders of each class of shares if

(a) by the special resolution or resolutions the members and shareholders authorize the directors to cause the credit union to distribute any property and discharge any liabilities; and

(b) the credit union has, pursuant to section 125, sold its property and distributed any residual property and discharged all of its liabilities.

Shareholders not entitled to vote.

131(4)

Notwithstanding subsections (2) and (3), the holders of any class of shares shall not be entitled to vote if, as a result of the dissolution, they would receive all moneys owing to them by the credit union.

Procedure.

131(5)

A credit union which is being dissolved pursuant to this section shall prepare articles of dissolution in accordance with section 133.

Proposing liquidation and dissolution.

132(1)

The directors, or a member, pursuant to section 65, may make a proposal for the voluntary liquidation and dissolution of a credit union.

Notice of meeting.

132(2)

Notice of any meeting of members at which voluntary liquidation and dissolution is to be proposed shall set out the terms thereof.

Members resolution.

132(3)

A credit union may liquidate and dissolve by special resolution of the members and, where the credit union has issued more than one class of shares, other than surplus shares, by special resolution of the holders of each class whether or not they are otherwise entitled to vote.

Shareholders not entitled to vote.

132(4)

Notwithstanding subsection (3), the holders of any class of shares shall not be entitled to vote if, as a result of the dissolution, they would receive all moneys owing to them by the credit union.

Statement of intent to dissolve.

132(5)

A statement of intent to dissolve in prescribed form shall be sent to the Registrar.

Certificate of intent to dissolve.

132(6)

Upon receipt of a statement of intent to dissolve, the Registrar if satisfied that prior to dissolution the credit union will be able to discharge all of its obligations and liabilities shall issue a certificate of intent to dissolve in accordance with section 228.

Effect of certificate.

132(7)

Upon issue of a certificate of intent to dissolve, the credit union shall cease to carry on business except to the extent necessary for the liquidation, but its legal existence continues until the Registrar issues a certificate of dissolution.

Liquidation.

132(8)

After issue of a certificate of intent to dissolve, the credit union shall

(a) immediately cause notice thereof to be sent to each known creditor of the credit union;

(b) forthwith publish notice in the Manitoba Gazette and once in a newspaper published or distributed in the place where the credit union has its registered office and take reasonable steps to give notice thereof in every jurisdiction where the credit union carries on business;

(c) proceed to collect its property, to dispose of properties that are not to be distributed in kind to its members and shareholders, to discharge all its obligations and to do all other acts required to liquidate its business; and

(d) after giving the notice required under clauses (a) and (b) and adequately providing for the payment or discharge of all its obligations, distribute its remaining property, either in money or in kind, in accordance with the provisions of the special resolution authorizing the dissolution.

Revocation.

132(9)

At any time after issue of a certificate of intent to dissolve and before issue of a certificate of dissolution, a certificate of intent to dissolve may be revoked by sending to the Registrar a statement of revocation of intent to dissolve in prescribed form, if the revocation is approved in the same manner as the resolution under subsection (3).

Certificate of revocation of intent to dissolve.

132(10)

Upon receipt of a statement of revocation of intent to dissolve, the Registrar shall issue a certificate of revocation of intent to dissolve in accordance with section 228.

Effect of certificate.

132(11)

On the date shown in the certificate of revocation of intent to dissolve, the revocation is effective and the credit union may continue to carry on its business.

Procedure.

132(12)

If a certificate of intent to dissolve has not been revoked and the credit union has complied with subsection (8), the credit union shall send articles of dissolution in accordance with section 133.

Articles of dissolution.

133(1)

Articles of dissolution in prescribed form shall be sent to the Registrar.

Certificate of dissolution.

133(2)

Upon receipt of articles of dissolution, the Registrar shall issue a certificate of dissolution in prescribed form and in accordance with section 228.

Effect of certificate.

133(3)

The credit union ceases to exist on the date shown in the certificate of dissolution.

Dissolution by Registrar.

134(1)

Subject to subsections (2) and (3),

(a) where a credit union is in default for a period of 2 consecutive years in sending to the Registrar any notice or document required by this Act; or

(b) where the Registrar has reasonable cause to believe that a credit union is not carrying on business or is not in operation; or

(c) where a credit union is in default in sending to the Registrar any fee required by this Act; the Registrar may dissolve the credit union by issuing a certificate of dissolution under this section.

Publication.

134(2)

The Registrar shall not dissolve a credit union under this section until

(a) the credit union has been given 90 days notice of the Registrar's decision to dissolve the credit union; and

(b) a notice has been published in the Manitoba Gazette of the decision to dissolve the credit union not less than 30 days prior to the date the Registrar may dissolve the credit union.

Credit union not in operation.

134(3)

Where a credit union, in writing, notifies the Registrar that it is not carrying on business or is not in operation, clause (2)(a) does not apply and the Registrar may publish a notice in compliance with clause (2)(b).

Certificate of dissolution.

134(4)

Unless the credit union remedies the default or cause to the contrary is shown or an order is made by a court under section 202, the credit union is deemed to be dissolved on the date specified in the notice under clause (2)(b) and the Registrar shall issue a certificate of dissolution pursuant to section 133.

Application to court to liquidate or dissolve.

135(1)

A member or the Registrar may apply to the court for an order to liquidate and dissolve a credit union and if

(a) the court is satisfied that

(i) any act or omission of the credit union effects a result, or

(ii) the business or affairs of the credit union are or have been carried on or conducted in a manner, or

(iii) the powers of the directors of a credit union have been exercised in a manner that is oppressive or unfairly prejudicial to, or unfairly disregards the interests of any security holder, creditor, director or officer; or

(b) the court is satisfied that the credit union is

(i) not fulfilling the purpose of a credit union generally under section 2, or

(ii) not carrying on business in accordance with the restrictions contained in its articles, or

(iii) not organized or operated in accordance with this Act and the regulations, or

(c) it is just and equitable that the credit union should be liquidated and dissolved; the court may order that the credit union be placed under the supervision of a supervisor for the purposes of liquidation and dissolution.

Court order.

135(2)

Upon an application under this section, the court may make such order, in addition to the order under subsection (1), as it thinks fit.

Certificate.

135(3)

Upon receipt of an order under subsection (1), the Registrar shall

(a) publish notice of the order in the Manitoba Gazette, and

(b) issue a certificate of dissolution pursuant to section 228 after

(i) all obligations of the credit union are discharged and all its property distributed or disposed of, and

(ii) the supervisor has rendered a final report to the court.

Custody of records.

136

The fund shall retain custody of the documents and records of any dissolved credit union for a period of 6 years following the effective date of the credit union's dissolution.

"Member" defined.

137(1)

In this section "member" includes the heirs of a member.

Continuation of actions.

137(2)

Notwithstanding the dissolution of a credit union under this Act,

(a) a civil, criminal or administrative action or proceeding commenced by or against the credit union before its dissolution may be continued as if the credit union had not been dissolved;

(b) a civil, criminal or administrative action or proceeding may be brought against the credit union within 2 years after its dissolution as if the credit union had not been dissolved; and

(c) any property that would have been available to satisfy any judgment or order if the credit union had not been dissolved remains available for that purpose.

Service.

137(3)

Service of a document upon a credit union after its dissolution may be effected by serving the document upon a person shown in the most recent notice on the records of the Registrar.

Reimbursement

137(4)

Notwithstanding the dissolution of a credit union, a member or shareholder to whom any of its property has been distributed is liable to any person claiming under subsection (2) to the extent of the amount received by that member or shareholder upon the distribution, and an action to enforce that liability may be brought within 2 years after the date of the dissolution of the credit union.

Representative action.

137(5)

A court may order an action referred to in subsection (4) to be brought against the persons who were members or shareholders as a class, subject to such conditions as the court thinks fit and, if the plaintiffs claim is established the court may refer the proceedings to a referee or other officer of the court who may

(a) add as a party to the proceedings each person who was a member or shareholder found by the plaintiff;

(b) determine, subject to subsection (4) the amount that each person who was a member or shareholder shall contribute towards satisfaction of the plaintiff's claim; and

(c) direct payment of the amounts so determined.

Unknown claimants.

138(1)

Upon the dissolution of a credit union, the portion of the property distributable to a creditor, shareholder or member who cannot be found shall be converted into money and paid to the fund.

Constructive satisfaction.

138(2)

A payment under subsection (1) is deemed to be in satisfaction of the debt to or claim of the creditor, shareholder or member.

Recovery.

138(3)

If at any time it is established that a person is entitled to any moneys paid to the fund under this Act, the fund shall pay such an amount to that person.

Execution of documents after dissolution.

138(4)

If at any time after the dissolution of a credit union, it is established that a person is entitled to receive a document for registration in a land titles office or the Personal Property Registry of the Province of Manitoba duly executed by that credit union, the fund shall execute the document on behalf of the dissolved credit union.

Validity.

138(5)

Any document executed by the fund pursuant to subsection (4) shall be accepted for registration in any land titles office or Personal Property Registry of the Province of Manitoba, as the case may be, if the fund has placed an explanation for its actions upon the document and the fund has otherwise complied with the requirements of the land titles office or the Personal Property Registry.

Vesting in fund.

138(6)

Subject to this section and section 137, property of a credit union that has not been disposed of at the date of its dissolution vests in the fund.

Revival by the Registrar.

139(1)

Where a credit union is dissolved under section 131, 132, or 134, any interested person may apply to the Registrar to have the credit union revived by filing articles of revival in prescribed form.

Revival by court

139(2)

Where a credit union is dissolved on the order of the court, any interested person may apply to the court to have the credit union revived.

Certificate of revival.

140(1)

Upon the receipt of articles of revival in prescribed form, or an order of the court to revive the credit union, the Registrar shall issue a certificate of revival in prescribed form and in accordance with section 228.

Rights preserved.

140(2)

A credit union is revived as a credit union under this Act on the date shown on the certificate of revival, and thereafter the credit union, subject to such reasonable terms as may be imposed by the court or the Registrar and to the rights acquired by any person after its dissolution, has all the rights and privileges and is liable for the obligations that it would have had if it had not been dissolved.

Return of property on revival.

141

If a credit union is revived under section 140, any property other than money that vested in the fund pursuant to section 138 and that has not been disposed of shall be returned to the credit union and there shall be paid to the credit union by the fund

(a) an amount equal to any money received by the fund pursuant to section 138; and

(b) where property other than money vested in the fund pursuant to section 138 and that property has been disposed of, an amount equal to the lesser of

(i) the value of the property at the date it vested in the fund, and

(ii) the amount realized by the fund from the disposition of the property.

PART XI

THE FUNDS

Application.

142(1)

This Part applies to the funds.

Boards continued.

142(2)

The funds are hereby continued as bodies corporate subject to the provisions of this Act and the members of the board and the officers of a fund on the coming into force of this Act continue in office until their successors are appointed or elected.

Effect of continuance.

142(3)

In addition to the provisions of section 233,

(a) a fund

(i) continues to be the owner of its property, and

(ii) continues to be liable for its obligations;

(b) an existing cause of action, claim or liability to prosecution involving a fund is unaffected;

(c) a civil, criminal, or administrative action or proceeding pending by or against a fund may be continued to be prosecuted by or against the fund; and

(d) a conviction against, or ruling, order or judgment in favour of or against a fund may be enforced by or against the fund.

Purposes of a fund.

143

The purposes of a fund are to guarantee the deposits of members of credit unions and to ensure and promote the development of sound financial procedures and controls to protect credit unions against financial losses and, without limiting the generality of the foregoing, a fund shall do such things as are necessary to enable a credit union assigned to it to satisfy the claims of the members of the credit union for withdrawals of deposits.

Powers.

144

Subject to the provisions of this Act and the regulations, a fund may

(a) draw, make, accept, endorse, discount, execute and issue promissory notes, bills of exchange, bills of lading, warrants and negotiable and transferable instruments;

(b) borrow money upon the credit of the fund;

(c) issue, reissue, sell or pledge debt obligations of the fund;

(d) mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the fund, owned or subsequently acquired, to secure any debt obligation of the fund;

(e) determine and fix levies upon credit unions assigned to it, for the purpose of establishing and maintaining a guarantee fund;

(f) acquire the assets and assume the liabilities of any credit union assigned to it that is being wound- up or dissolved;

(g) enter into contracts to guarantee the whole or any part of the issue price of any class of shares of a credit union or any dividends thereon or any debt obligations of the credit union and to determine and fix the fees therefor;

(h) subject to the approval of thé Registrar, invest moneys of the fund in reasonable and proper investments, including, without limiting the generality of the foregoing, in shares and other securities of a central;

(i) become an associate of a central;

(j) establish insurance requirements and arrange group or blanket insurance coverage to be carried by credit unions in amounts that the funds deems adequate;

(k) determine and establish the type and nature of information required to be provided by the credit unions and central within the system to enable it to monitor the performance and financial viability of the system;

(l) enter into an agreement with the Canada Deposit Insurance Corporation, the Government of Canada or of Manitoba, or an agent of the Canada Deposit Insurance Corporation, or of the Government of Canada, or of Manitoba, to extend to the board, loans or policies of insurance that the fund deems adequate to enable it to meet its requirements for liquid funds and for its administration and operation and may, for the purpose of the foregoing, charge all or any of the assets of the fund, and the moneys received or receivable from assessments or fees and the income therefrom;

(m) guarantee or advance loans to a credit union assigned to it that is in financial difficulty and requires assistance to maintain solvency;

(n) make grants to a credit union assigned to it to allow the credit union to meet the claims of its members for withdrawal of deposits;

(o) execute such documents on behalf of a credit union which has been dissolved as may be necessary for registration in any land titles office or Personal Property Registry;

(p) do all other acts and things incidental to and necessary for the fulfilling of its purposes.

Board of a fund.

145

The affairs of a fund shall be administered by a board of 5 members, who shall be appointed by the Lieutenant Governor in Council.

Chairman.

146

The chairman of the board shall be appointed by the Lieutenant Governor in Council, and the board may elect such other officers as it deems advisable.

Qualifications of board members.

147

Any person who is 18 years of age except

(a) an undischarged bankrupt; or

(b) an employee, director or officer of a credit union, central or a fund; or

(c) an auditor of

(i) a credit union which is assigned to that fund,

(ii) that fund,

(iii) the central in that system; or

(d) a solicitor of that fund; may be a board member of a fund.

Term of office.

148

Unless the Lieutenant Governor in Council otherwise orders, members of the board hold office for a term of 3 years commencing from and including the day on which they are appointed, and thereafter until their successors are appointed.

Vacancies.

149

Where a vacancy occurs for any reason in the board of the fund the Lieutenant Governor in Council shall fill the vacancy.

Ceasing to hold office.

150

A member of the board of a fund ceases to hold office upon

(a) death or resignation; or

(b) becoming disqualified from holding the office under section 147; or

(c) being removed from office by the Lieutenant Governor in Council.

Duties of board.

151

The board shall

(a) exercise the powers of the fund directly, or indirectly through the employees and agents of the fund; and

(b) direct the management of the business and affairs of the fund.

Quorum.

152

A majority of the members of the board constitutes a quorum.

By-laws.

153

The board, in order to regulate the business and affairs of the fund, may enact by-laws not contrary to law and amend or repeal any of them, but no by-law and no amendment or repeal thereof is in force, or may be acted upon, unless the approval of the Registrar is obtained and a certified copy is filed with the Registrar.

Records.

154

The board shall keep proper records of the affairs of the fund and shall keep such accounts of its finances as the Registrar may require.

Fiscal year.

155

The fiscal year of a fund ends on December 31st in each year.

Audit.

156

The books and accounts of a fund shall be examined, checked and audited at least once each year by an auditor approved by the Registrar.

Procedure.

157

Part VII and sections 98, 99, 101 to 103, 105, 106, 108 and 110 to 113 apply, with the necessary changes, to a fund.

Assignment.

158

Every credit union shall be assigned to the Stabilization Fund and every caisse populaire shall be assigned to Le Fonds de sécurité.

Levies.

159

Each credit union shall pay to the fund to which it is assigned, the amounts levied by that fund.

Amount of levies.

160(1)

Subject to section 161, a fund shall, at the end of each quarter of its fiscal year, make a levy upon each credit union assigned to it, of a prescribed percentage of the average of the month end aggregates for the months in that quarter of

(a) the amount of deposits with the credit union and accrued interest thereon; and

(b) the amount of outstanding borrowings of the credit union.

Notice of levy.

160(2)

A fund shall send by mail to each credit union assigned to it, prior to the end of each quarter of each fiscal year of the fund, a notice of the percentage on which the levy under subsection (1) for that quarter is to be based and the credit union shall, within one month after the end of the quarter, pay the amount of the levy to the fund.

Extension of time.

160(3)

Notwithstanding subsection (2), a fund may extend the time for payment of any amount levied under this section.

Special assessment

160(4)

Where the board of a fund is of the opinion that the guarantee fund of that fund is, or is about to be, impaired, that fund, by notice in writing, may require each credit union assigned to it to pay, in addition to amounts levied under subsection (1), a special assessment of a prescribed percentage of the aggregate, as of the end of the fiscal year of the fund immediately preceding the date the assessment is made, of

(a) the amount of deposits with the credit union and accrued interest thereon; and

(b) the amount of outstanding borrowings of the credit union.

Only one assessment per year.

160(5)

A fund shall not make more than one assessment under subsection (4) in any year.

Time for payment of assessment

160(6)

Where a fund makes an assessment under subsection (4), each credit union assigned to it shall pay the amount of the assessment calculated on the percentage set out in the notice of assessment within the time specified in the notice of the assessment.

Reduction of levy.

161(1)

Subject to subsection (4), a fund may reduce or refund all or part of the amount levied against a credit union under section 160.

Refund as receipt of credit union.

161(2)

Where a credit union receives a refund under subsection (1), it shall include the amount of the refund in its income in the fiscal year in which it is received.

Continuation of levies.

161(3)

Notwithstanding that a levy against a credit union is reduced or refunded, in whole or in part, a fund may subsequently continue to make prescribed levies against the credit union and collect them.

Restriction on reductions and refunds.

161(4)

At the end of its fiscal year, and before any reduction or refund of a levy is allowed to be made to a credit union, a fund shall credit any surplus in that year and debit any loss in that year to the guarantee fund and shall not reduce any levy or make any refund of a levy to a credit union that would reduce the guarantee fund below an amount to be set out in the by-laws of the fund, which in the opinion of the fund, is necessary to enable it to fulfill its purposes.

Report to Registrar.

162(1)

At the end of each fiscal year, the board of a fund shall report on the administration of that fund to the Registrar and to the credit unions assigned to that fund.

Further report to Registrar.

162(2)

The board of a fund shall report to the Registrar on the administration of that fund at such other times as the Registrar may require.

Advertising.

163

No credit union shall advertise or make representation to the public, with respect to the nature of a fund's guarantee of members' deposits, except in accordance with the policy which the fund may establish from time to time. PART XII THE CENTRALS

Application.

164(1)

This Part applies to centrals.

Application to continue.

164(2)

Forthwith on the coming into force of this Act, the directors of CCSM and Fédération shall apply to the Registrar to be continued under and in conformity with this Act, and the Registrar shall issue to the applicant a certificate continuing it as a body corporate under this Act.

Effect of certificate.

164(3)

On the date shown in the certificate under subsection (2),

(a) the applicant becomes a body corporate to which this Act applies as if it had been incorporated under this Act;

(b) the application is deemed to be the articles of incorporation of the applicant;

(c) the certificate is deemed to be the certificate of incorporation of the applicant;

(d) the charter by-laws of the applicant continue to be its charter by-laws until amended;

(e) the members of the applicant continue to be its members;

(f) the board of directors and officers of the applicant continue to be its directors and officers;

(g) the property of the applicant continues to be its property;

(h) the applicant continues to be liable for its obligations;

(i) an existing cause of action, claim or liability to prosecution is unaffected;

(j) a civil, criminal or administrative action or proceeding pending by or against the applicant may continue to be prosecuted by or against the applicant;

(k) a conviction against, or ruling, order or judgment in favour of or against, the applicant may be enforced by or against the applicant;

(l) a share of the applicant issued before the applicant was continued is deemed to be a common share and is deemed to have been issued in compliance with this Act irrespective of whether the share is fully paid or of any designation, rights, privileges, restrictions or conditions set out on or referred to in the certificate respecting the share but continuance does not deprive a holder of any right or privilege attached to, or relieve the holder of any liability in respect of, an issued share.

Purposes of a central.

165

The purposes of a central are

(a) to receive and manage the liquidity reserves of credit unions;

(b) to develop and provide to credit unions, on a cooperative basis, financial services and any other services the credit unions may require and which, by their nature, can be most effectively provided by a central, including educational, research, and advisory work relating to credit unions and the function of a central;

(c) to promote and develop sound management principles and operating procedures for the benefit of credit unions;

(d) to promote the organization, development and welfare of credit unions in the Province of Manitoba and to encourage co-operation among cooperatives, credit unions and caisses populaires; and

(e) in the case of the Fédération, to develop and provide the services set out in clauses (a), (b), (c) and (d) in the French language and to encourage and promote the use of that language in its system.

Capacity of a central.

166(1)

A central has the capacity, and subject to this Act, the rights, powers and privileges of a natural person.

Extra-territorial capacity.

166(2)

Subject to the approval of the Registrar, a central 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.

Powers of a central.

167(1)

Subject to this Act, it is not necessary for a charter by-law to be passed in order to confer any particular power on a central or its directors.

Restricted business or powers.

167(2)

A central shall not carry on any business or exercise any power which it is restricted by its charter by-laws from carrying on or exercising, nor shall a central exercise any powers in a manner contrary to its charter by-laws.

Rights preserved.

167(3)

No act of a central is invalid by reason only that the act is contrary to its charter by-laws or this Act.

Registered office and records.

168

Part IV of this Act except subsection 18(5), applies, with the necessary changes, to a central.

Common shares.

169(1)

A central is authorized to issue to its members an unlimited number of common shares, which shall have an issue price of $5. each.

Shares per member and associate member.

169(2)

Members and associate members of a central shall be required to purchase and hold such number of shares in a central as may be required by charter by-law.

Shares other than common shares.

170

In addition to common shares, the articles of a central may provide for the issuance to its members and associate members of more than one class of shares, and if the articles so provide, there shall be set out therein the maximum number of shares in each class, other than common shares, that a central 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.

Share certificates.

171

Part VI of The Cooperatives Act applies, with the necessary changes, to the issuance of share certificates for shares of a central.

Patronage refunds.

172

Section 28 applies with the necessary changes to the payment of patronage refunds by a central.

Use of patronage refunds.

173

A central may in its charter by-laws provide that, in each fiscal year of the central, the whole of any patronage refund, credited to a member or associate member or such part thereof as may be prescribed in the charter by-laws, shall be applied to purchase on behalf of the member or associate member additional shares of the central, up to such number, if any, as may be specified in the charter by-laws.

Redemption of shares and payment of dividends.

174

A central shall not pay a dividend on, or redeem, shares if there are reasonable grounds for believing that

(a) the central is, or would thereby be, unable to pay its liabilities as they become due; or

(b) the realizable value of the central'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 shares that have a right to be paid, on a redemption or in a liquidation, rateably with or prior to the holders of the shares to be purchased or redeemed.

Securities.

175

Section 34 applies with the necessary changes to the issuance of securities by a central.

Voting rights.

176

Section 35 applies, with the necessary changes, to all shares issued by a central.

Financial matters.

177

Sections 37, 38, 44 and 48, and subsection 46(2) apply, with the necessary changes, to a central.

Membership in central.

178

Every credit union shall be a member of CCSM and every caisse populaire shall be a member of Fédération.

Associate members.

179(1)

A central may, in its charter by-laws, permit persons who are not credit unions to become associate members of the central upon such terms and conditions as are set out in its charter by-laws.

Rights and privileges of associate members.

179(2)

An associate member of a central shall have only those rights and privileges which are specifically granted to associate members in the charter by-laws of the central.

Establishment of delegate system.

180(1)

The powers of the members of a central shall be vested in delegates to be elected or appointed by the members of the central in such a manner as shall be prescribed in the charter by-laws of the central.

Scope of powers.

180(2)

Delegates elected or appointed pursuant to the charter by-laws of a central shall exercise fully and completely the powers, or any of them, of the members of a central and, as such, a meeting of the delegates of a central shall have the same effect in every way as a meeting of the members of a central.

One delegate one vote.

180(3)

A delegate has only one vote on any question that may be voted on at a meeting of a central.

Limit of Liability.

181

Subject to this Act, a member or associate member is not responsible for any act, default or liability whatsoever of a central or for any engagement, claim, payment, loss, injury, transaction, matter or thing whatsoever relating to or connected with the central.

Adoption of charter by-laws.

182

Section 58 applies, with the necessary changes, to the adoption of charter by-laws by a central.

Registrar's approval.

183

The Registrar shall approve any charter by-law enacted by a central if the Registrar is satisfied that the charter by-law conforms with this Act and is consistent with the purposes of the central.

Charter by-laws.

184

The charter by-laws of a central shall provide for any matter required by this Act to be included and shall provide for such other matters which are applicable including, without limiting the generality of the foregoing

(a) qualifications, conditions and method of applying for and terminating membership or associate membership;

(b) the location of meetings of delegates, the mode of holding meetings and the quorum thereat;

(c) the procedure by which members or delegates call a special meeting of delegates;

(d) the enactment, amendment or repeal of charter by-laws at any annual meeting or general meeting called for that purpose;

(e) the right of delegates to vote by ballot or mail or both, and the manner, form and effect of votes at meetings;

(f) the election, term of office, removal of and filling of vacancies among directors, committee members, and officers, their powers, duties, and remunerations;

(g) the procedure and quorum at meetings of board of directors;

(h) the establishment, maintenance and relocation of a registered office and branch offices for the central wherever so deemed necessary or appropriate;

(i) the establishment of the fiscal year end of the central;

(j) the incorporation and ownership of subsidiary companies by the central;

(k) investment and use of the assets of the central;

(l) the loan of any moneys to its members or associate members;

(m) the borrowing or raising or securing the payment of money;

(n) the charging, hypothecation, mortgaging or pledging the real and personal property of the central;

(o) the issuing of debt obligations by the central; and

(p) all other matters which, by this Act, are required to be dealt with in the charter by-laws of a central.

Members bound by charter by-laws.

185

The charter by-laws of a central bind the central and its members.

Number of directors.

186(1)

A central shall, by charter by-law, establish a fixed number, or a minimum and maximum number of directors for the central.

Power to manage.

186(2)

The directors of a central shall

(a) exercise the powers of the central directly, or indirectly through the employees and the agents of the central; and

(b) direct the management of the business and affairs of the central.

Qualification of directors.

187

Any citizen of Canada who is a delegate of a credit union and 18 years of age except

(a) an undischarged bankrupt; or

(b) an employee, auditor or solicitor of a central or fund; or

(c) a civil servant whose official duties are concerned with the affairs of centrals or credit unions; or

(d) a delegate of a member which fails to comply with the requirements set out in the charter by-laws of the central; may be a director of a central.

Application of other Parts of the Act

188

Parts VII and VIII and sections 114 to 118 and 128 apply, with the necessary changes, to a central.

Information to fund.

189

A central shall, upon request, provide to the fund within its system such information concerning credit unions which the fund may reasonably require to enable the fund to discharge its responsibilities under the Act.

System credit committee.

190

A central shall establish a credit committee as prescribed for the purpose of monitoring the credit granting procedures of credit unions in Manitoba and the credit committee shall perform those duties assigned to it pursuant to the Act and regulations.

PART XIII

REMEDIES, OFFENCES AND PENALTIES

Definitions.

191

In this Part,

"action" means an action under this Act; ("action")

"complainant" means

(i) a member, or

(ii) a registered owner or beneficial owner, or former registered owner or beneficial owner, of a security of a credit union or central, or

(iii) a director or an officer, or a former director or officer, of a credit union, a central or a fund or any of their subsidiaries, or (iv) a creditor, or

(v) the Registrar, or

(vi) a credit union, or

(vii) a central, or

(viii) a fund, or

(ix) any other person who, in the discretion of the court, is a proper person to make an application under this Part. ("plaignant")

Commencing derivative action.

192(1)

Subject to subsection (2), a complainant may apply to the court for leave to bring an action in the name and on behalf of a credit union, or intervene in an action to which the credit union is a party, for the purpose of prosecuting, defending or discontinuing the action on behalf of the credit union.

Notice to Registrar.

192(2)

A complainant under this section shall give the Registrar notice of the application, and the Registrar is entitled to appear and be heard in person or by counsel.

Conditions precedent.

192(3)

No action may be brought and no intervention in an action may be made under subsection (1) unless the court is satisfied that

(a) the complainant has given reasonable notice to the directors of the credit union of the complainant's intention to apply to the court under subsection (1) if the directors of the credit union do not bring and diligently prosecute or defend, or discontinue the action;

(b) the complainant is acting in good faith; and

(c) it appears to be in the interest of the credit union that the action be brought, prosecuted, defended or discontinued, as the case may be.

Powers of court.

193

In an action brought or intervened in under section 192, the court may at any time make any order it thinks fit including, without limiting the generality of the foregoing,

(a) an order authorizing the complainant or any other person to control the conduct of the action;

(b) an order giving directions for the conduct of the action;

(c) an order directing that any amount adjudged payable by the defendant in the action shall be paid, in whole or in part, directly to former and present members or other security holders of the credit union;

(d) an order requiring the credit union to pay reasonable legal fees incurred by the complainant in connection with the action;

(e) an order requiring the credit union to furnish to the complainant or to any other person all material or information relevant to the action including, without limitation,

(i) the financial statements of the credit union,

(ii) the name and address of each member of the credit union, and

(iii) the name and address of each creditor of the credit union, including any creditor with unliquidated, future or contingent claims and any person with whom the credit union has a contract.

Application to court by complainant

194(1)

A complainant may apply to the court for an order under this section.

Grounds.

194(2)

Where, upon an application under subsection (1) with respect to any credit union, central or fund, the court is satisfied that

(a) any act or omission of the credit union, central or fund effects a result; or

(b) the business or affairs of a credit union, central or fund are or have been carried on or conducted in a manner; or

(c) the powers of the directors of a credit union, central or fund are or have been exercised in a manner; that is unlawful, unfairly prejudicial, or that unreasonably disregards the interests of any complainant, the court may make an order to rectify the matters complained of.

Powers of the court.

194(3)

In an application under this section, the court may make any interim or final order it thinks fit including, without limiting the generality of the foregoing,

(a) an order restraining the conduct complained of;

(b) an order placing a credit union or central under supervision pursuant to sections 209 and 210;

(c) an order placing a credit union under supervision pursuant to section 209 for the purpose of liquidation and dissolution;

(d) an order to regulate the affairs of a credit union, central or fund by amending its articles or by-laws as the case may be;

(e) an order directing an issue or exchange of securities;

(f) in the case of a credit union or a central, an order appointing directors in place of or in addition to all or any of the directors then in office;

(g) an order varying or setting aside a transaction or contract to which a credit union, central or fund is a party, and compensating the credit union, central or fund or any other party to the transaction or contract;

(h) an order directing rectification of the registers or other records of the credit union, central or fund under section 196;

(i) an order directing the fund to permit or accept the reassignment of a credit union to a fund under section 197;

(j) an order requiring the trial of any issue;

(k) an order compensating a complainant or any other person.

Duty of directors.

194(4)

Where an order made under this section directs an amendment of the articles or by-laws of a credit union or central,

(a) in the case of an amendment to the articles, the directors shall forthwith comply with subsection 128(4); and

(b) in the case of an amendment to the by-laws, the directors shall forthwith send to the Registrar the amended by-laws together with a certified copy of the court order; and no other amendment to the articles or by-laws shall be made without consent of the court, until the court otherwise orders.

Exclusion.

194(5)

A member of a credit union is not entitled to dissent under section 127 if an amendment to the articles is effected under this section.

Evidence of member approval not decisive.

195(1)

An application made or an action brought or intervened in under this Part shall not be stayed or dismissed by reason only that it is shown that an alleged breach of a right or duty owed to a credit union or central has been or may be approved by the members thereof, but evidence of approval by the members may be taken into account by the court in making an order under this Part.

Court approval to discontinue.

195(2)

An application made or an action brought or intervened in under this Part shall not be stayed, discontinued, settled or dismissed for want of prosecution without the approval of the court given upon such terms as the court thinks fit and, if the court determines that the interest of any complainant may be substantially affected by the stay, discontinuance, settlement or dismissal, the court may order any party to the application or action to give notice thereof to that complainant.

No security for costs.

195(3)

A complainant is not required to give security for costs in any application made or action brought or intervened in under this Part.

Interim costs.

195(4)

In an application made or an action brought or intervened in under this Part, the court may at any time order the credit union, central or fund to pay to the complainant interim costs including legal fees and disbursements, but the complainant may be held accountable for any interim costs so paid upon final disposition of the application or action.

Application to court to rectify records.

196

Where the name of a person is alleged to be or to have been wrongly registered or retained in, or wrongly deleted or omitted from, the registers or other records of a credit union, central or fund, the credit union, central, fund or a member or other security holder thereof or any complainant may apply to the court for an order that the registers or records be rectified.

Reassignment of affiliation.

197(1)

Upon the application of a credit union, the Registrar may, if satisfied that it does not materially prejudice the interests of the credit union and both systems, permit a credit union to be reassigned from one system to the other.

Notice.

197(2)

Before permitting a credit union to be reassigned from one system to another, the Registrar shall give at least 15 days notice to the fund and central of each system for the purpose of allowing them to make representations to the Registrar with respect to such application.

Conditions.

197(3)

In granting approval pursuant to subsection (1), the Registrar may impose such conditions upon the credit union, the centrals or the funds as the Registrar deems appropriate in order to ensure that the interests of all affected parties are properly protected.

Application to court

197(4)

Where the Registrar grants or refuses to grant approval to a reassignment pursuant to subsection (1) or imposes conditions pursuant to subsection (3), the credit union, a central or a fund may appeal the Registrar's decision to the court.

Notice to Registrar.

197(5)

An applicant under subsection (4) shall give notice to the Registrar of the application and the Registrar is entitled to appear and be heard in person or by counsel.

Powers of court

198

Upon an application under section 196 or 197, the court may make any order it thinks fit including, without limiting the generality of the foregoing,

(a) an order requiring the registers and records of the credit union or central to be rectified;

(b) an order restraining the credit union or central from calling or holding a meeting of members or allocating or paying interest before rectification of the registers or records;

(c) an order determining the right of a party to the proceedings to have that party's name entered or retained in, or deleted or omitted from the registers or records of the credit union or central whether the issue arises between 2 or more members or other security holders or alleged members or security holders, or between the credit union or central and any member or security holder or alleged member or security holder;

(d) an order compensating a party who has incurred a loss by reason of the wrongful entry, retention, deletion or omission;

(e) an order directing or prohibiting a reassignment of a credit union to a system upon such terms and conditions as the court deems appropriate.

Compliance or restraining order.

199

Where a credit union, central or fund, or any director, officer, member, employee, agent, auditor, trustee, or supervisor thereof does not comply with or is acting in breach of

(a) a provision of this Act; or

(b) the regulations; or

(c) the articles or by-laws of the credit union of central; or

(d) an order of the Registrar made under this Act; any complainant may, in addition to any other remedy the complainant has, apply to the court for an order directing compliance with or restraining the action in breach of the provision, articles, by-laws or order and the court may make the order and any further order it thinks fit.

Application for directions.

200

The Registrar may apply to the court for directions in respect of any matter concerning the Registrar's duties under this Act, and upon the application the court may give such directions and make such order as it thinks fit.

Appeal to court of Registrar's decision.

201

Any person may appeal any decision of the Registrar to the court within 30 days from the making of the decision.

Questions of law or fact.

202

An appeal under section 201 may be made in a question of law or fact or both and the court, after hearing the appeal, may

(a) affirm or reverse the decision;

(b) direct the Registrar to make any other decision or order that the Registrar is authorized to make under this Act;

(c) substitute its decision for that of the Registrar.

Review by Registrar.

203

The Registrar

(a) shall review or cause to be reviewed information and returns received from credit unions, centrals, and funds and their directors, officers, committee members or employees;

(b) may inspect and examine the business and affairs of any credit union, central, or fund;

(c) shall be given access to all records, books, accounts, vouchers and other documents; and

(d) may make such inquiries as are necessary to ascertain whether a credit union, central or fund has complied with this Act, the regulations or any order or direction.

Submission to Registrar.

204(1)

For the purposes of the inspection or examination referred to in section 203, a credit union and a central shall prepare and submit to the Registrar such information with respect to its business and affairs, in addition to the returns required under Part VIII, as the Registrar may require.

Power of commissioner to Registrar.

204(2)

Upon any inspection or examination, the Registrar or any person authorized by the Registrar has the powers of a commissioner under Part V of The Manitoba Evidence Act and that Part except section 88 applies to the inquiry as if it were an inquiry under that Act.

Offences respecting reports.

205(1)

A person who makes or assists in making a report, return, notice or other document required by this Act to be sent to the Registrar or to any other person that

(a) contains an untrue statement of a material fact; or

(b) omits to state a material fact required therein or necessary to make a statement contained therein not misleading in the light of the circumstances in which it was made; 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 both.

Liability of director or officer.

205(2)

Where the person guilty of an offence under subsection (1) is a body corporate, then, whether or not the body corporate has been prosecuted or convicted, any director or officer of the body corporate who knowingly authorizes, permits or acquiesces in the offence is also 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 both.

Exception.

205(3)

No person is guilty of an offence under subsection (1) or (2) if the untrue statement or omission was unknown to that person and in the exercise of reasonable diligence could not have been known to that person.

Offence.

206

Every person, who without reasonable cause contravenes a provision of this Act and no other punishment therefor is provided herein, is guilty of an offence and is liable on summary conviction to a fine not exceeding $500.

Order to comply.

207(1)

Where a person is convicted of an offence under this Act, the convicting court may, in addition to any punishment imposed, order the person to comply with the provisions of the Act for the contravention of which that person has been convicted.

Time limited for proceedings.

207(2)

A prosecution for an offence under this Act shall be instituted at any time within 2 years from the time when the subject matter of the complaint arose.

Civil remedy not affected.

207(3)

No civil remedy for an act or omission under this Act is suspended or affected by reason only that the act or omission is an offence under this Act.

Suit at instance of Registrar or fund.

208

Notwithstanding anything in this Part to the contrary, where an action could be brought against a person by a credit union or central for any loss or damage suffered by or any accounting due to the credit union or central by reason of the negligence of the person or the failure of the person to comply with this Act, or with the articles or by-laws of the credit union or central or any orders, directions or notices of the Registrar or the fund,

(a) if the action has not been brought, the Registrar or, in the case of a credit union, the fund may, without leave, bring and maintain the action; or

(b) if the action has been brought, the Registrar or, in the case of a credit union, the fund may apply to the court to be added as a plaintiff and to be given the conduct of the action; and any money recovered by the Registrar or the fund shall be held for the benefit of the credit union or central or, where a grant, loan or advance has been made by the fund, shall be held for the benefit of the fund.

PART XIV

SUPERVISION

Supervision of credit union.

209

Where the Registrar is satisfied that a credit union is carrying on its business in a manner that contravenes the Act or the regulations, or that is financially unsound, including those situations where

(a) a credit union is unable to pay its liabilities as they become due; or

(b) the realizable value of a credit union's assets is less than the aggregate of its liabilities and the capital account of all classes of shares of the credit union, other than common shares; or

(c) a credit union has requested and the fund has determined to give it financial assistance; or

(d) a credit union fails to adhere to the operating standards established pursuant to Part V of this Act; or

(e) a credit union fails to file a report or document required to be filed by this Act within the time fixed for filing by this Act; the Registrar may give notice to the credit union that it is declared to be under the supervision of a supervisor appointed by the Registrar.

Supervision of central.

210

Where the Registrar is satisfied that a central is carrying on its business in a manner that contravenes the Act or the regulations, or that is financially unsound, including those situations where

(a) a central is unable to pay its liabilities as they become due; or

(b) the realizable value of a central's assets is less than the aggregate of its liabilities and the capital account of all classes of sharps of the central; or

(c) a central is unable to meet its obligations to manage the liquidity requirement of its system; or

(d) a central fails to file a report or document required to be filed by this Act within the time fixed for filing by this Act; the Registrar may give notice to the central that it is declared to be under the supervision of a supervisor appointed by the Registrar.

Supervisor of credit union.

211

The supervisor appointed by the Registrar under section 209 shall be a fund.

Supervisor of central.

212

The supervisor appointed by the Registrar under section 210 shall not be a fund.

Term of supervision.

213

Where a credit union or central is declared to be under supervision, the credit union or central shall remain subject to the supervision until

(a) the supervisor applies to the Registrar to have the credit union or central released from supervision; or

(b) it applies in writing to the Registrar, with notice to the supervisor, to be released from supervision, stating reasons in support of its application, and the Registrar approves the application; or

(c) the Registrar by notice to the credit union or central and its supervisor releases the credit union or central from supervision; or

(d) the credit union is liquidated, dissolved or amalgamated; or

(e) in the case of a credit union or central which has been placed under supervision by the court, an order of the court has been made releasing the credit union or central from supervision.

Powers of supervisor.

214(1)

Subject to the approval of the Registrar, or to any order of the court, where a credit union or central has been placed under the supervision of a supervisor, the supervisor may

(a) exercise or cause to be exercised any or all of the powers of the credit union or central;

(b) inspect the affairs of the credit union or central and make inquiries from its officers, directors, committee members, employees and members;

(c) require the credit union or central to correct any practices that in the opinion of the supervisor are contributing to the financial difficulties suffered by the credit union or central or are likely to contribute to the unsound conduct of its affairs;

(d) order the credit union or central and its directors, committee members, officers and employees to refrain from exercising in whole or in part such of the powers of the credit union or central or of its directors, committee members, officers or employees or any of them as may be specified in the order unless approved by the supervisor or the supervisor's authorized agent or employee;

(e) order the credit union or central not to declare or pay interest or dividends, or to restrict the amount of interest or dividends to be paid to a rate or an amount fixed by the supervisor;

(f) carry on, manage and conduct the operations of the credit union or central and in the name of the credit union or central preserve, maintain, realize, dispose of and add to the property of the credit union or central, receive the incomes and revenues of the credit union or central and exercise all the powers of the credit union or central and of its directors, officers, committees and employees;

(g) exclude the directors of the credit union or central and its officers, committee members, employees and agents from the property and business of the credit union;

(h) in the case of a credit union, amalgamate, dissolve, wind-up, liquidate or otherwise dispose of the business of the credit union;

(i) exercise such other powers as may be granted to it by order of the court.

Powers of supervisor on liquidation.

214(2)

Sections 215 and 216 of The Corporations Act apply, with the necessary changes, to a supervisor appointed to liquidate assets of the credit union.

Duty of supervisor to creditors on liquidation.

214(3)

A supervisor shall ensure that the interests of all creditors of a credit union or central are properly and lawfully provided for.

Court direction.

215

A supervisor may apply to the court for direction in the exercise of any of its powers.

Accounting to Registrar.

216

A supervisor appointed by the Registrar shall, upon request of the Registrar and upon discharge, fully account to the Registrar for the supervision of the credit union or central.

Discharge.

217

Unless the Registrar or the court, as the case may be, otherwise orders, within 30 days after completion of the accounting, the supervisor is released from all claims by

(a) the credit union or central or any member or any creditor thereof; or

(b) any person claiming under the credit union or central or a member or creditor thereof; other than claims arising out of fraud or dishonesty.

Temporary supervision.

218(1)

Notwithstanding section 209, a fund may, if the special circumstances of any case so require and upon the grounds of urgency or for other reasons appearing to it to be sufficient, give notice to a credit union that it is declared to be under the temporary supervision of the fund.

Report to Registrar.

218(2)

Where a fund acts under subsection (1), it shall report in writing within 48 hours to the Registrar, and the Registrar shall conduct or cause to be conducted such investigation of the reasons for action by the fund under subsection (1) as the Registrar considers necessary.

Powers.

218(3)

Until otherwise ordered by the Registrar, the fund may do all things and take such actions as are specified in subsection 214(1), except for the powers set forth in clause 214(1)(h).

Action by Registrar.

218(4)

The Registrar shall, within 14 days after the receipt of a report under subsection (2),

(a) release the credit union from the temporary supervision of the fund; or

(b) give notice to the credit union that it is declared to be under supervision pursuant to section 209.

PART XV

GENERAL

Notice to directors and members.

219(1)

A notice or document required by this Act, or by the charter by-laws of a credit union, or central, to be sent to a person entitled to receive notice from the credit union or central may be given in accordance with the charter by-laws or, in the absence of a provision in the charter by-laws, may be sent by prepaid mail addressed to, or may be delivered personally to,

(a) the person at the latest address of the person, as shown in the records of the credit union or central or its transfer agent; and

(b) in the case of a director, at the latest address of the director, as shown in the records of the credit union or central, or in the last notice filed under section 83.

Deemed receipt.

219(2)

A notice or document mailed in accordance with subsection (1) is deemed to have been received by the person entitled to receive notice at the time it would be delivered in the ordinary course of mail, unless there are reasonable grounds for believing that the person did not receive the notice or document at that time or at all.

Undelivered notices.

219(3)

Where a credit union or central mails a notice or document to a person in accordance with subsection (1) and the notice or document is returned on 2 consecutive occasions because the person cannot be found, the credit union or central is not required to send any further notices or documents to the person until the credit union or central is informed, in writing, of that person's new address.

Published notices.

219(4)

Where the charter by-laws of a credit union or central provide for the giving of a notice to members under subsection (1) by insertion of the notice in a newspaper or other publication, the notice is deemed to have been received by the members at the time the publication containing the notice is distributed in the ordinary course.

Posted notices.

219(5)

Where the charter by-laws of a credit union or central provide for the giving of a notice to members under subsection (1) by posting the notice in a specified place or places, the notice is deemed to have been received by the members at the time the notice is posted.

Notice to and service upon a credit union.

220

A notice or document required to be sent to or served upon a credit union or central may be sent by registered mail to the registered office of the credit union or central shown in the last prescribed notice filed with the Registrar and, if so sent, is deemed to have been received or served at the time it would be delivered in the ordinary course of mail, unless there are reasonable grounds for believing that the credit union or central did not receive the notice or document at that time or at all.

Waiver of notice.

221

Where a notice or document is required by this Act to be given or sent, the giving or sending thereof may be waived or the time for the giving or sending thereof may be waived or abridged at any time with the consent in writing of the person entitled thereto.

Certificate of Registrar.

222(1)

Where this Act requires or authorizes the Registrar to issue a certificate or to certify any fact, the certificate shall be signed by the Registrar or by a Deputy Registrar appointed under section 226.

Evidence.

222(2)

A certificate referred to in subsection (1) or a certified copy thereof, when introduced as evidence in any civil, criminal or administrative action or proceeding, is conclusive proof of the facts so certified without proof of the signature or official character of the person appearing to have signed the certificate.

Certificate of credit union.

223(1)

A certificate issued on behalf of a credit union or central, stating any fact that is set out in the articles of a credit union, the charter by-laws, the minutes of the meetings of the directors, a committee of directors, the members, or in a trust indenture or other contract to which the credit union or central is a party may be signed by a director, an officer or a transfer agent of the credit union or central.

Proof.

223(2)

When introduced as evidence in any civil, criminal or administrative action or proceeding,

(a) a certificate of a kind referred to in subsection (1); or

(b) a certified extract from a members register or a securities register of a credit union or central; or

(c) a certified copy of minutes or an extract from minutes of a meeting of members or directors or a committee of directors of a credit union or central; is, in the absence of evidence to the contrary, proof of the facts thereby certified without proof of the signature or official character of the person appearing to have signed the certificate.

Security certificate.

223(3)

An entry in a securities register of, or a security certificate issued by, a credit union or central is, in the absence of evidence to the contrary, proof that the person in whose name the security is registered is the owner of the securities described in the register or in the certificate.

Copies.

224

Where a notice or document is required to be sent to the Registrar under this Act, the Registrar may accept a photostatic or photographic copy thereof.

Proof required by Registrar.

225(1)

The Registrar may require that a document or a fact stated in a document required by this Act to be sent to the Registrar shall be verified in accordance with subsection (2).

Form of proof.

225(2)

A document or fact required by this Act or by the Registrar to be verified may be verified by affidavit or statutory declaration under The Manitoba Evidence Act before any commissioner for oaths or for taking affidavits.

Authentication.

225(3)

The Registrar may require a credit union or central to authenticate a document, and the authentication may be signed by the secretary, or any director or authorized person or by the solicitor for the credit union or central.

Appointment of Registrar.

226(1)

The minister may appoint a Registrar and one or more Deputy Registrars to carry out the duties and exercise the powers of the Registrar under this Act.

Duties.

226(2)

The Registrar shall generally oversee compliance with the provisions of this Act and the regulations so as to ensure the public's interest is protected and to that end shall perform such duties as this Act requires or as may be prescribed.

Regulations.

227(1)

The Lieutenant Governor in Council may make regulations

(a) prescribing any matter required or authorized by this Act to be prescribed;

(b) prescribing the form and content of the charter by-laws;

(c) respecting the names of credit unions and centrals;

(d) prescribing restrictions on the businesses which may be carried on by a credit union;

(e) respecting the establishment of branch offices by a credit union;

(f) respecting the form and content of annual returns, notices and other documents required to be sent to or issued by the Registrar;

(g) requiring the payment of a fee for the filing, examination or copying of any document, or for any action that the Registrar is required or authorized to take under this Act including inspection, audits and investigations, and prescribing the amount of the fee;

(h) respecting the preferences, rights, conditions, restrictions, limitations or prohibitions attaching to shares or classes of shares;

(i) respecting the designation of classes of shares;

(j) prescribing an amount which may be paid upon the death of a member;

(k) respecting conditions, restrictions or limitations on the making of loans or advances of any kind by a credit union;

(l) respecting the establishment of policies for the granting and making of loans or advances of any kind by a credit union;

(m) respecting reviews of outstanding loans of any kind;

(n) prescribing the amount which constitutes a material deposit made by a credit union;

(o) prescribing the circumstances in which a member may be permitted to make overdrafts on deposit accounts of the member and requiring or respecting the establishment of policies of credit unions in respect of overdrafts;

(p) respecting liquidity reserves to be established and maintained;

(q) respecting conditions, restrictions or limitations on the making of investments;

(r) respecting an allowance for doubtful accounts to be established and maintained;

(s) prescribing the level of equity to be established and maintained;

(t) respecting matching under section 49;

(u) respecting insurance to be taken out and maintained by a credit union;

(v) prescribing the manner in which a person may appeal membership termination;

(w) prescribing the fees to be paid for services, searches and other things under this Act and fixing the time and manner of payment thereof;

(x) prescribing the form and content of financial statements;

(y) respecting the establishment of an audit committee;

(z) respecting the manner of selecting and the qualifications of nominees for the board of a fund;

(aa) respecting the establishment of a credit committee;

(bb) prescribing rules for any exemptions permitted by this Act;

(cc) prescribing the circumstances in which the Registrar may waive the payment of fees;

(dd) respecting any matter required for the efficient administration of this Act.

Forms.

227(2)

The Lieutenant Governor in Council may in regulations under subsection (1) provide for the use, with the necessary changes, of forms and statements that are required under Part XVI of The Cooperatives Act.

Fees not fixed in regulations.

227(3)

When no fee is fixed in the regulations for any services performed under this Act, the Minister may fix the fee therefor.

"Statement" defined.

228(1)

In this section, "statement" means a statement of intent to dissolve or statement of revocation of intent to dissolve referred to in section 132.

Filings.

228(2)

Where this Act requires that articles or a statement relating to a credit union be sent to the Registrar, unless otherwise specifically provided herein

(a) 2 duplicate originals of the articles or the statement shall be signed by a director or officer of the credit union or, in the case of articles of incorporation by the incorporators; and

(b) if the articles or statement conform to law and are accompanied by all the required by-laws or other documents and the fees in respect thereof are paid, the Registrar shall, subject, where required by this Act, to being satisfied that it is advisable,

(i) endorse on each of the 2 duplicate originals of the articles or statement the prescribed certificate indicating the date on which the articles or statement become effective,

(ii) file 1 duplicate original of the articles or statement endorsed in accordance with sub-clause (i),

(iii) send the other duplicate original of the articles or statement, endorsed in accordance with sub-clause (i), to the credit union or its representative, and

(iv) publish in the Manitoba Gazette a notice of the issue of the certificate and the date the articles or statement to which it relates become effective.

Effective date.

228(3)

The date indicated on a certificate issued under subsection (2) as the date the articles or statement becomes effective shall not be earlier than the date on which the Registrar received the articles or statement or court order pursuant to which the certificate is issued.

Certificates, searches, etc.

228(4)

The Registrar may furnish any person (a) with a certificate that a credit union or other person has or has not filed with the Registrar a document required to be filed under this Act or any other Act for which this Act was substituted; or

(b) with a certified copy of any document in the custody and control of the Registrar.

Alteration.

229

The Registrar may alter any notice or document, other than an affidavit or statutory declaration, if so authorized by or on behalf of the person who sent the notice or document to the Registrar.

Corrections.

230(1)

Where a certificate or order containing an error is issued by the Registrar, the Registrar shall issue a corrected certificate or order and may

(a) demand the surrender of the certificate or order containing the error; and

(b) request the directors or members of the credit union

(i) to pass resolutions, or

(ii) to send to the Registrar the documents required to comply with this Act, and to take such other steps as the Registrar reasonably requires.

Date of corrected certificate.

230(2)

A certificate or order corrected under subsection (1) shall have effect from the date of the certificate or order it replaces.

Notices.

230(3)

Where a corrected certificate or order issued under subsection (1) materially amends the terms of the original certificate or order, the Registrar shall forthwith give notice of the correction in The Manitoba Gazette.

Inspection.

231(1)

A person who has paid the appropriate fee is entitled during usual business hours to examine the annual returns, notices, articles or charter by-laws of a credit union or central or any order or declaration of the Registrar or court filed with the Registrar.

Copies.

231(2)

The Registrar shall furnish, upon receipt of the appropriate fee, any person with a copy or a certified copy of any document to which reference is made in subsection (1).

Form of records of Registrar.

232(1)

Records required by this Act to be prepared and maintained by the Registrar may be in bound or loose-leaf form or in photographic film form, or may be entered or recorded by any system of mechanical or electronic data processing or by any other information storage device that is capable of reproducing any required information in intelligible written form within a reasonable time.

Obligation to furnish.

232(2)

Where records maintained by the Registrar are prepared and maintained in other than written form,

(a) the Registrar shall furnish any copy required to be furnished under subsection 231(2) in intelligible written form; and

(b) a report reproduced from those records, if it is certified by the Registrar, is admissible in evidence to the same extent as the original records would have been if they had been in written form.

Production of records limitation.

232(3)

The Registrar is not required to produce any document, other than a certificate and attached articles or statement filed under section 228, after 6 years from the date the Registrar receives it.

Continuation of former incorporations, etc.

233(1)

Notwithstanding the repeal of The Credit Unions and Caisses Populaires Act

(a) all articles and licences;

(b) all cancellations, suspensions, proceedings, acts, registrations and things; and

(c) all affidavits, declarations, by-laws, resolutions, regulations and documents; shall be continued under this Act as if they had in fact been granted, issued, imposed, made, taken, done, commenced, filed or passed under this Act.

Saving clause re by-laws, etc.

233(2)

Subject to subsections (3) and (4), where any provision of the articles, by-laws or resolutions of a credit union, central or fund

(a) that was in force immediately prior to the date this Act comes into force; and

(b) that was not unlawful under the law as it was immediately prior to the date this Act comes into force; is inconsistent with the provisions of this Act, that provision is not invalid solely for that reason.

Exception.

233(3)

A provision of the articles, by-laws or resolutions that is referred to in subsection (2) and that contravenes section 94 of this Act is invalid.

2 years to comply.

233(4)

Where a provision of the articles, by-laws or resolutions of a credit union, central or fund is inconsistent with the provisions of this Act, the credit union, central or fund shall file with the Registrar amending articles, by-laws or resolutions that comply with this Act within 2 years of the coming into force of this Act or such longer period as may be prescribed.

Amendments.

233(5)

Any addition or amendment to or deletion from any provision in the letters patent, supplementary letters patent, articles, or by-laws of a credit union, central or fund shall be made in accordance with this Act.

Reference to Act.

233(6)

Any reference in an Act, articles, by-laws or resolutions to The Credit Unions and Caisses Populaires Act, as it existed before the coming into force of this Act, or to any procedure under that Act, shall be deemed to be a reference to this Act and to the equivalent procedure under this Act.

Reference in Continuing Consolidation.

234

This Act may be referred to as chapter C301 in the Continuing Consolidation of the Statutes of Manitoba.

Repeal of former Act.

235

The Credit Unions and Caisses Populaires Act, chapter C300 of the Continuing Consolidation of the Statutes of Manitoba is repealed.

Repeal of CCSM.

236

An Act to Incorporate Co- operative Credit Society of Manitoba Limited, being chapter 105 of the Statutes of Manitoba, 1950 (1st), is deemed to be repealed on the date that the Registrar issues to CCSM a certificate under section 164.

Repeal of Fédération.

237

An Act to provide for the Amalgamation of La Centrale des Caisses Populaires du Manitoba Ltée and La Centrale des Caisses Populaires du Manitoba Credit Union Limited, being chapter 67 of the Statutes of Manitoba, 1977, is deemed to be repealed on the date that the Registrar issues to the Fédération a certificate under section 164.

Commencement of Act

238

This Act comes into force on a day fixed by proclamation.