Skip to main content
The Agricultural Credit Corporation Act
This is an unofficial archived version of The Agricultural Credit Corporation Act
as enacted by SM 1987-88, c. 9 on July 17, 1987.

R.S.M. 1987, c. A10

The Agricultural Credit Corporation Act

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

Definitions.

1(1)

In this Act

"approved lending institution" means a lending institution approved by the Lieutenant Governor in Council for the purpose of making loans under Part IV; ("institution de prêt agréée")

"borrower" means a person to whom a loan is made by the corporation or to whom a guaranteed loan is made by a bank or approved lending institution under Part IV; ("emprunteur")

"corporation" means The Manitoba Agricultural Credit Corporation; ("Société")

"directors" means the directors of the corporation; ("administrateurs")

"farmer" means, subject to subsection (2),

(a) an individual whose principal occupation is farming or who is a part-time farmer, or

(b) a corporation, including a co-operative corporation, the purposes of which include farming and the majority in number and value of shares thereof are held by individuals whose principal occupation is farming; ("exploitant agricole")

"farming" includes the growing of cereal crops, the growing of vegetable or special crops other than cereal crops, stock raising or stock keeping, dairying, poultry raising, apiculture, and fur ranching; ("exploitation agricole")

"guaranteed loan" means a loan to a farmer made in accordance with and guaranteed under Part IV; ("prêt garanti")

"livestock" means horses, cattle, sheep, swine, goats, live poultry, bees and fur breeding stock; ("animaux de ferme")

"manager" means the manager of the corporation; ("directeur")

"minister" means the member of the Executive Council charged by the Lieutenant Governor in Council with the administration of this Act; ("ministre")

"part-time farmer" means part-time farmer as defined in the regulations. ("exploitant agricole à temps partiel")

Determination of farmer.

1(2)

The corporation shall determine who is a farmer for the purposes of this Act.

PART I

ORGANIZATION OF CORPORATION

Corporation continued.

2

The Manitoba Agricultural Credit Corporation is continued as a body corporate.

Members of corporation.

3

The persons who are from time to time members of the board of directors of the corporation comprise the corporation.

Alternate name.

4

The corporation may also be known by and use the name: "The Manitoba Agricultural Credit and Development Corporation", and may carry on business, enter into contracts, execute documents, sue and be sued under that name.

Objects.

5

The objects of the corporation are to provide credit facilities for farmers, to assist farmers in obtaining credit and to assist in development of farms in the province.

Board of directors.

6

The Lieutenant Governor in Council shall appoint a board of directors of the corporation consisting of five persons, two of whom shall be representatives of recognized farm organizations and three of whom may be members of the civil service of the Government of Manitoba.

Chairman and vice-chairman.

7(1)

The Lieutenant Governor in Council shall appoint one director as chairman of the board of directors and one director as vice-chairman.

Duties of vice-chairman.

7(2)

Where the chairman of the board of directors is absent or unable to act, or where he requests the vice-chairman to act for him, the vice-chairman shall act as, and have all the powers, authority and duties of the chairman.

Term of office of director.

8(1)

Subject to subsection (3), unless he sooner dies, resigns, or is removed from office, or unless he is appointed for a shorter term, each director shall hold office for three years from the date of his appointment and thereafter until his successor is appointed.

Filling of vacancies.

8(2)

Where a director dies, resigns, or is removed from office prior to the expiration of his term of office, any person appointed to fill the vacancy so created, unless he sooner dies, resigns, or is removed from office, or unless he is appointed for a shorter time, shall hold office for the remainder of the term of office of the person in whose place he is appointed, and thereafter until his successor is appointed.

Re-appointment

8(3)

A director whose term of office has expired is eligible for re-appointment.

Remuneration of directors.

9

The corporation shall pay each director such reasonable travelling and out-of-pocket expenses necessarily incurred by him in discharging his duties, and such remuneration as may be fixed by the Lieutenant Governor in Council.

Quorum.

10

Three directors constitute a quorum at meetings of the board of directors.

Rules of procedure.

11

The directors may adopt rules governing the procedure of the board of directors.

Appointment of manager.

12

Subject to the approval of the Lieutenant Governor in Council, the corporation may appoint a manager who may be one of the directors of the corporation.

PART II

FINANCES OF CORPORATION

Payment of administration costs.

13(1)

The corporation shall apply the revenues derived by it from its operations in payment firstly of the cost of administration, including salaries of officers and employees and remuneration of directors.

Payment of interest to government.

13(2)

After payment of the costs of administration, the corporation shall apply the remaining balance of the revenues, so far as they are sufficient, in payment of interest on the advances made to it under section 17 and not repaid, at such rate as may be fixed from time to time by the Lieutenant Governor in Council.

Reserve fund.

14(1)

Subject to subsection (2), after payment of costs of administration and interest as provided in section 13, the balance, if any, of the revenue shall be retained by the corporation and placed in a reserve to be used as working capital.

Payment of excess reserve to government.

14(2)

Where the amount in the reserve established under subsection (1) exceeds 20% of the amount of principal moneys advanced and remaining owing and unpaid under loans made, the corporation shall pay the excess to the minister charged with the administration of The Financial Administration Act, as he may require, to be deposited by him in the trust and special division of the Consolidated Fund and used for the benefit of the corporation.

Investment of surplus moneys.

15(1)

The corporation shall pay to the minister charged with the administration of The Financial Administration Act, for investment for the corporation, moneys in any reserve established under section 14 and such additional moneys as are not immediately required for the purposes of the corporation and are available for investment.

Disposal of invested moneys.

15(2)

Moneys paid under subsection (1) for investment shall form part of the trust and special division of the Consolidated Fund and may be invested in accordance with The Financial Administration Act, and the interest earnings thereon shall be credited to the account of the corporation in the trust and special division of the Consolidated Fund.

Repayment to corporation.

15(3)

Any earnings, either alone or with the principal sum invested for the corporation under this section, or any part thereof, shall be paid over to the corporation by the minister charged with the administration of The Financial Administration Act on the request of the board.

Deficiency in revenues.

16

If, in any fiscal year of the corporation, the revenues thereof together with the amount, if any, in any reserve established under section 14, are insufficient to pay the costs of administration, the amount of the deficiency may be paid from and out of the Consolidated Fund with moneys authorized by an Act of the Legislature to be so paid and applied; and no interest shall be charged to the corporation in respect of that fiscal year on the advances made to it under section 17 and not repaid.

Advances to corporation.

17

With the approval of the Lieutenant Governor in Council, and subject to such conditions as the Lieutenant Governor in Council may approve, there may be advanced to the corporation from and out of the Consolidated Fund, with moneys authorized by an Act of the Legislature to be paid and applied for the purposes of this Act, such moneys as it requires from time to time for the purposes of achieving its objects.

Loans by government.

18(1)

To the extent permitted by any Act of the Legislature, the Lieutenant Governor in Council may authorize the raising by way of loan, in the manner provided in The Financial Administration Act, of such sums as the Lieutenant Governor in Council may deem requisite for any of the purposes of the corporation under this Act; and any such sums may be advanced to and paid over by the government to the corporation and shall be repaid by it to the government at such times and on such terms as the Lieutenant Governor in Council may direct, together with interest thereon as provided in subsection (2).

Fixing of rate of interest.

18(2)

Where an advance is made to the corporation under subsection (1), the Lieutenant Governor in Council shall fix the rate of interest that shall be paid by the corporation on the sums so advanced, or on the balance thereof remaining from time to time outstanding and not repaid, during such period as is fixed by the Lieutenant Governor in Council; and after the expiry of that period, the minister charged with the administration of The Financial Administration Act shall, by an order in writing, fix, and alter from time to time, as may be required, the rate of interest that shall be paid by the corporation on the sums so advanced, or on the balance thereof as aforesaid, during any one or more subsequent periods that may be stated in any such order.

Power of corporation to borrow and issue securities.

19(1)

Subject to the approval of the Lieutenant Governor in Council, and to subsection (2), the corporation may

(a) raise money by way of loan on the credit of the corporation;

(b) limit or increase the amount to be raised; and

(c) issue notes, bonds, debentures, or other securities of the corporation;

for the purposes of the corporation; and, through the minister charged with the administration of The Financial Administration Act, who shall be its agent in that behalf, it may

(d) sell or otherwise dispose of the notes, bonds, debentures, or securities, for such sums, and at such prices as are deemed expedient;

(e) raise money by way of loan on any such securities;

(f) pledge or hypothecate any such securities as collateral securities; and

(g) do any of those things.

Limitation on borrowing powers.

19(2)

The powers conferred on the corporation under subsection (1) may be exercised only

(a) for the repayment of any expenditure made, or that may be made, by the government for the purposes provided for in this Act, or for the repayment, refunding, or renewal, of the whole or part of any loan or advance made by the government to the corporation or of notes, bonds, debentures, or other securities issued by the corporation; or

(b) in cases to which clause (a) does not apply, only to the extent permitted by this Act or any other Act of the Legislature.

Reissue of pledged securities.

19(3)

Where securities have been pledged or hypothecated by the corporation as security for a loan, and the loan has been paid off, the securities shall not thereby be extinguished, but shall be still alive, and may be reissued and sold or pledged as if the former pledging had not taken place.

Form of securities.

19(4)

The notes, bonds, debentures, and other securities, the issue of which is authorized under subsection (1), shall be in such form, and shall bear such rates of interest, and shall be payable as to principal, interest, and premium, if any, at such times and places, in the currencies of such countries or in such units of monetary value, in such amounts, and in such manner in all respects, as the Lieutenant Governor in Council may determine.

Execution of securities.

19(5)

The notes, bonds, debentures, and other securities, the issue of which is authorized under subsection (1), shall bear the seal of the corporation which may be impressed thereon or may be engraved, lithographed, printed, or otherwise mechanically reproduced thereon, and, together with any coupons attached thereto, shall bear the manual, engraved, lithographed, printed, or otherwise mechanically reproduced, signatures of the chairman or vice-chairman of the board of directors of the corporation and of the treasurer of the corporation; and any such mechanically reproduced seal and signatures shall, for all purposes, be valid and binding upon the corporation if the note, bond, debenture, or other security bearing it, or to which the coupon bearing it is attached, is countersigned by an officer appointed by the corporation for that purpose, notwithstanding that the person whose signature is so reproduced may not have held office at the date of the notes, bonds, debentures, or other securities or at the date of the delivery thereof and notwithstanding that the person who holds any such office at the time when any such signature is affixed is not the person who holds that office at the date of the notes, bonds, debentures, or other securities or at the date of the delivery thereof.

Proof that issue of securities is necessary.

19(6)

A recital or declaration, in the resolution or minutes of the board, authorizing the issue or sale of notes, bonds, debentures, or other securities, to the effect that the amount of notes, bonds, debentures, or other securities, so authorized is necessary to realize the net sum authorized or required to be raised by way of loan, is conclusive evidence of that fact.

Power of government to guarantee.

20(1)

The government may, on such terms as may be approved by the Lieutenant Governor in Council, guarantee the payment of the principal, interest, and premium, if any, of any notes, bonds, debentures, or other securities issued by the corporation; and the form and manner of the guarantee shall be as may be approved by the Lieutenant Governor in Council.

Signing of guarantees.

20(2)

The guarantee shall be signed by such member of the Executive Council, or such other officer or officers of the government, as may be designated by the Lieutenant Governor in Council; and, upon being signed, the government is liable for the payment of the principal, interest, and premium, if any, of the notes, bonds, debentures, or other securities, guaranteed according to the tenor thereof; and, in the hands of the holder of the notes, bonds, debentures, or other securities of the corporation, the guarantee so signed is conclusive evidence that compliance has been made with the terms of this section.

Discharge of liability under guarantee.

20(3)

The government may discharge the liability arising from a guarantee given under this section out of the Consolidated Fund, or out of the proceeds of securities of the government issued and sold for the purpose.

Signature of member of Executive Council.

20(4)

The signature of the member of the Executive Council, or of any other officer or officers, for which provision is made in subsection (2), may be engraved, lithographed, printed, or otherwise mechanically reproduced, and the mechanically reproduced signature of that person shall be conclusively deemed, for all purposes, to be the signature of that person and is binding upon the government, notwithstanding that the person whose signature is so reproduced may not have held office at the date of the notes, bonds, debentures, or other securities, or at the date of the delivery thereof, and notwithstanding that the person who holds the office at the time when the signature is affixed is not the person who holds that office at the date of the notes, bonds, debentures, or other securities, or at the date of the delivery thereof.

Authority to raise loans in other currencies.

21

Where this Act, or any other Act, authorizes the corporation to borrow or raise by way of loan, a specific or maximum number of dollars by the issue and sale of notes, bonds, debentures, or other securities, if the amount of the loan is raised, in whole or in part, by the issue and sale of notes, bonds, debentures, or other securities payable in the currency of any country other than Canada or in units of monetary value, the Act authorizes the raising of an equivalent amount in that other currency or unit of monetary value calculated in accordance with the nominal rate of exchange between the Canadian dollar and that currency or unit of monetary value on the business day next preceding the day on which the Lieutenant Governor in Council authorizes the issue of the notes, bonds, debentures, or other securities, as that nominal rate is determined by any bank in Canada; and subsection 67(2) of The Financial Administration Act applies thereto with such modifications as the circumstances require.

Administration of funds.

22(1)

The corporation shall dispose of, and carefully administer, the moneys advanced to it under this Act and shall account to the minister, from time to time, as he may require, for the due expenditure and administration of the moneys.

Audit of accounts.

22(2)

The accounts of the corporation shall be examined, checked and audited by the Provincial Auditor from time to time and at least annually.

Fiscal year.

22(3)

The fiscal year of the corporation is the period of 12 months beginning on April 1 in each year and ending on March 31 in the next succeeding year.

PART III

DIRECT LOANS

Authority for loans and lines of credit.

23

In accordance with, and subject to, the regulations, the corporation may make loans and provide a complete line of credit to a farmer to assist the farmer

(a) to diversify his farming operation: or

(b) to carry on or improve a farming operation; or

(c) to relocate on new land where he will be better able to carry on a farming operation; or (d) to establish or develop a farming operation that will assist other farmers in their farming operations.

Security.

24

In accordance with, and subject to, the regulations, the corporation shall take security to secure repayment of each loan made by it or payment of any line of credit provided by it.

Floating charges.

25

The corporation may take as security, in whole or in part for a loan, a specific or floating mortgage or charge of or on the chattels of a borrower to secure specific loans or loans arranged as continuous or revolving lines of credit where advances may be made and repaid in whole or in part and advanced again from time to time.

PART IV

GUARANTEED LOANS

Payment of guarantees.

26(1)

Subject to this Part, the corporation shall pay to a bank or to an approved lending institution the amount of loss sustained by it as a result of a guaranteed loan under this Part, if

(a) the loan made by the bank or approved lending institution to the borrower was made in accordance with this Act and subject to the terms and conditions prescribed in the regulations;

(b) the loan was made pursuant to an application, assigned by the borrower, in the form and containing the information prescribed by the regulations;

(c) a responsible officer of the bank or of the approved lending institution certified that he had scrutinized and checked the application for the loan with the care required of him by the bank or the approved lending institution in the conduct of its ordinary business:

(d) the principal amount of the loan did not, at the time of making the loan, together with the amount owing on other guaranteed loans of which the bank or the approved lending institution has knowledge, exceeds the amount prescribed by the regulations:

(e) the loan was repayable as provided in the regulations;

(f) the rate of interest on the loan did not exceed the rate prescribed by the regulations; and

(g) the loan was approved by the corporation, in the manner prescribed in the regulations.

Guarantees of individual lender loans.

26(2)

The corporation shall pay to an individual lender the amount of loss sustained by the lender as a result of a guaranteed loan under this Part if

(a) the loan was made for any of the purposes set out in section 27;

(b) the loan was made in accordance with the regulations.

Cl. 28(b) and secs. 29 & 30 apply.

26(3)

The provisions of clause 28(b) and sections 29 and 30 apply with the necessary changes to a loan made under subsection (2).

Limitation on guarantees.

27

Notwithstanding section 26, the corporation shall not underwrite or guarantee any loan of a bank or approved lending institution to a borrower that is not for any or all of the following purposes and no other:

(a) the erection, making of additions to, and other improvements of farm houses and other farm buildings situated on land owned by the borrower;

(b) the clearing, breaking, draining, or fencing, of land, or the effecting thereon of other improvements of a permanent nature that, in the opinion of the manager, will tend to increase the productive value of the land or promote conservation of the soil thereof;

(c) the consolidating of outstanding liabilities incurred for productive agricultural purposes;

(d) the purchase of livestock;

(e) the purchase of agricultural implements and farm machinery;

(f) such other purposes related to the establishment, development and operation of a farm unit of the borrower as are approved by the directors.

Guarantee unenforceable under certain conditions.

28

Notwithstanding section 26, and notwithstanding the guarantee or approval of a loan by the corporation, the corporation shall not be required to pay the loss of a bank or approved lending institution as a result of a guaranteed loan unless

(a) the bank or approved lending institution has taken all measures and procedures prescribed by the regulations to enforce collection of the guaranteed loan; and

(b) the bank or approved lending institution has done or neglected to do no act or thing whereby the liability of the borrower is affected or released.

Effect of change of terms.

29

Except as otherwise provided in this Act or the regulations, unless the written approval of the corporation is first obtained, any alteration or revision in the terms or conditions of a guaranteed loan, or any extension of time for repayment or performance of the covenants thereunder, renders the obligation of the corporation to guarantee payment null and void.

Subrogation.

30(1)

Where payment is made by the corporation to a bank or approved lending institution under this Part in respect of any loss sustained by the bank or approved lending institution as a result of a guaranteed loan, the bank or approved lending institution shall execute a receipt in favour of the corporation in the form prescribed by the regulations, and the corporation is thereupon subrogated in and to all the rights of the bank or approved lending institution in respect of the guaranteed loan; and, without limiting the generality of the foregoing, all rights and powers of the bank or approved lending institution in respect of the guaranteed loan and in respect of any judgment in respect thereof obtained by the bank or approved lending institution, and in respect of any security taken by the bank or approved lending institution for the repayment thereof, thereupon are vested in the corporation, and the corporation is entitled to exercise all rights and privileges that the bank or approved lending institution had or might exercise in respect of the guaranteed loan, judgment or security, and to commence or continue any action or proceeding in respect thereof, and to execute any document necessary by way of release, transfer, sale or assignment thereof, or in any way to realize thereon.

Form of receipt.

30(2)

A document purporting to be a receipt executed under subsection (1), in the form prescribed by the regulations and purporting to be signed on behalf of a bank or approved lending institution, is evidence of the payment by the corporation to the bank or approved lending institution under this Part in respect of the guaranteed loan therein mentioned, and of the execution of the said document on behalf of the bank or approved lending institution.

PART V

GENERAL

Regulations.

31

For the purpose of carrying out the provisions of this Act according to their intent, the board of directors, with the approval of the Lieutenant Governor in Council, may make such regulations as are ancillary thereto and are not inconsistent therewith; and every regulation made under, and in accordance with the authority granted by, this section has the force of law; and, without restricting the generality of the foregoing, the directors may, with the approval of the Lieutenant Governor in Council, make regulations,

(a) prescribing classes of loans that may be made under Part III or Part IV or classes of credit that may be provided under Part III;

(b) prescribing qualifications of persons eligible for any class of loans or credit;

(c) respecting the method of applying for any class of loan or credit, and prescribing the form of application for any class of loan or credit;

(d) prescribing conditions subject to which any class of loan or credit shall be made or provided under this Act;

(e) providing the maximum or minimum amounts that may be loaned on various classes of loans or allowed in various classes of credit under this Act;

(f) prescribing the security required for various classes of loans or credit under this Act and the form of the security;

(g) fixing the rate of interest, or the maximum or minimum rates of interest, payable on any class of loans or credit made or provided under this Act or prescribing the manner or fixing the rate of interest to be paid thereon;

(h) prescribing the terms and conditions under which a bank or approved lending institution may, in the event of actual or impending default in payment of a guaranteed loan, and notwithstanding anything contained in Part III, alter or revise, with the approval of the borrower, by way of extension of time, or otherwise, any of the terms of the loan or any agreement in connection therewith, without affecting the liability of the corporation in respect of its guarantee under this Act;

(i) in the event of default in the repayment of a guaranteed loan, prescribing the measures to be taken and the procedures to be followed by a bank or approved lending institution for the collection of the amount of the guaranteed loan outstanding and the realization of any and all security held by the bank or approved lending institution;

(j) prescribing the proofs of loss required by the corporation and the method of determination of the amount of the loss sustained by a bank or approved lending institution;

(k) prescribing the steps to be taken by a bank or approved lending institution on behalf of the corporation to effect collection from the borrower of any moneys paid out by the corporation to the bank or approved lending institution in respect of a guaranteed loan, and providing that, in the event of neglect by the bank or approved lending institution to take such steps, the amount of the payment may be recovered by the corporation;

(l) requiring reports to be made periodically to the corporation by a bank or approved lending institution in respect of guaranteed loans made by it;

(m) providing, as a condition of the guarantee by the corporation of a guaranteed loan, for inspection of the property offered as security by the borrower, and for inspection of the security documents of the bank or approved lending institution in respect of a guaranteed loan and prescribing the amount and terms of insurance coverage on the property mortgaged as security for the guaranteed loan;

(n) prescribing the maximum amount payable by the corporation by way of guarantee under this Act to a bank or approved lending institution in respect of the total amount of the guaranteed loans of a bank or approved lending institution;

(o) defining who is a part-time farmer for the purposes of this Act;

(p) prescribing terms and conditions for guaranteeing loans made by individual lenders under subsection 26(2) including any of the procedures which may be prescribed for a bank or approved lending institution under clauses (h) to (m).

Acquiring real property.

32

Subject to the approval of the Lieutenant Governor in Council, the corporation may

(a) acquire by lease or purchase, real property required by it for its purposes;

(b) acquire by lease or purchase, real property for the purpose of assisting in the relocation of farming operations or for the purpose of assembling land to assist in the development of economic units;

(c) develop any real property acquired by it for any of its purposes and erect thereon buildings and structures that the corporation deems necessary for its purposes;

(d) enter into leases or agreements with the minister on behalf of the government, or with any other person, respecting the use and occupancy of buildings and structures of the corporation for agricultural programs and services; and

(e) sell, lease, or otherwise dispose of, any real property acquired by it.

Agreements with Canada.

33

The minister, for and on behalf of the government, may, with the approval of the Lieutenant Governor in Council, enter into agreements with the Government of Canada, whereby the Government of Canada will make available to the Government of Manitoba moneys to be used for the purposes of this Act or will assist the government, or the corporation, in achieving the purposes and objects of the corporation.

Annual report.

34

Not later than September 30 in each year, the corporation shall submit to the minister a report of its operations during the fiscal year ending on March 31 in that year, and the minister shall lay the report before the assembly, if it is then in session, and if it is not then in session, at the next ensuing session thereof.

Part XXIV of Corporations Act not to apply.

35

Part XXIV of The Corporations Act does not apply to the corporation; and where any provision of this Act conflicts with any provision of The Corporations Act, the provision of this Act prevails.