Modernizing the Credit Unions and Caisses Populaires Act

PART XV
DISSOLUTION, AMALGAMATION, OTHER FUNDAMENTAL CHANGES

Definition

      296. In this Part,

"contributory" means a person who is liable to contribute to the property of a credit union in the event of the credit union being wound up under this Act.  1994, c. 11, s. 296.

DISSOLUTION

Dissolution where no assets

      297. (1) A credit union that has no assets and no liabilities may, if authorized by a special resolution of the members, apply to the Superintendent for an order dissolving the credit union.  1994, c. 11, s. 297 (1); 1997, c. 28, s. 53.

Same

     (2) The Superintendent, if he or she receives an application under subsection (1) and is satisfied that a dissolution of the credit union is appropriate, may issue an order dissolving the credit union.  1994, c. 11, s. 297 (2); 1997, c. 28, s. 53.

Same

     (3) A credit union in respect of which an order is issued under subsection (2) ceases to exist on the day stated in the order.  1994, c. 11, s. 297 (3).

Voluntary winding up

      298. (1) The members of a credit union may, by special resolution passed at a general meeting called for that purpose, require the credit union to be wound up voluntarily.

If more than one class of shares

     (2)  If the credit union has more than one class of issued shares, the special resolution referred to in subsection (1) shall be in the form of a special resolution passed by the holders of each class of shares. 

Appointment of liquidator

      (3) At the meeting passing the special resolution, the members shall appoint a person as liquidator of the estate and effects of the credit union for the purpose of winding up its affairs and distributing its property.

Who can be liquidator

      (4) Only the following may be appointed as a liquidator under this section:

  1. The Corporation.
  2. A licensed trustee in bankruptcy.

Remuneration and expenses of liquidator

      (5) The remuneration of the liquidator and the costs, charges and expenses of the winding up shall be determined in accordance with the following:

  1. If the liquidator is the Corporation, the remuneration and costs, charges and expenses shall be as set by the Corporation as of the day the resolution is passed.
  2. If the liquidator is a licensed trustee in bankruptcy, the remuneration and costs, charges and expenses shall be as set out in the appointment of the liquidator.

Publication of notice of winding-up

      (6) The liquidator shall,

         (a)    file a copy of the resolution under subsection (1) and the appointment under subsection (3) with the Superintendent within ten days after the resolution has been passed;

         (b)    publish a notice of the resolution and the appointment in The Ontario Gazette within twenty days after the resolution has been passed; and

         (c)    publish a notice of the resolution and the appointment in a newspaper having a general circulation in the locality where the head office of the credit union is located.

Vacancy in office of liquidator

      (7) The following apply if a vacancy occurs, by death, resignation or otherwise, in the office of a liquidator appointed under this section:

  1. The members of the credit union, by a majority of the votes cast at a general meeting called for that purpose, may appoint a person to fill the vacancy.
  2. If the members fail to appoint a person under paragraph 1, the Superintendent shall appoint a person to fill the vacancy.

Same

      (8) Repeal

Removal of liquidator

      (9) Unless the liquidator is the Corporation, the members of the credit union may, by a majority of the votes cast at a general meeting called for that purpose, remove a liquidator appointed under this section and appoint a replacement.

Start of winding-up

      (10) Repeal

Credit union to cease business

      (11) From the time the resolution under subsection (1) is passed, the credit union shall cease to carry on its business, except in so far as is, in the opinion of the liquidator, required for the beneficial winding-up of the credit union, but the corporate state and all the corporate powers of the credit union, despite anything to the contrary in the charter of the credit union, continue until the affairs of the credit union are wound up.

Corporate powers continue

      (12) Repeal

No proceeding against credit union without leave

      (13) After the resolution under subsection (1) is passed, no suit, action or other proceeding shall be proceeded with or commenced against the credit union, except with the leave of the court and subject to such terms as the court imposes.

Attachments, etc. void

      (13.1) Every attachment, sequestration, distress or execution put in force against the estate or effects of the credit union after the passing of the resolution under subsection (1) is void.

Liquidator to take custody

      (14) Upon appointment, the liquidator shall take custody and control of all property, rights and privileges of the credit union or to which the credit union appears to be entitled and shall take all necessary steps to wind up the credit union. 1994, c. 11, s. 298 9-14.

Statement of assets and liabilities

      (15) Within sixty days after being appointed, the liquidator shall prepare a statement of the assets and liabilities of the credit union as of the start of the winding up and file the statement with the Superintendent.

List of contributories and calls

      (16) Upon a voluntary winding-up, the liquidator,

         (a)    shall settle the list of contributories; and

         (b)    may, before having ascertained the sufficiency of the property of the credit union, call on any of the contributories for the time being settled on the list of contributories, to the extent of their liability, to pay any sum that the liquidator considers necessary to satisfy the liabilities of the credit union, and the costs, charges and expenses of winding up and for the adjustment of the rights of the contributories among themselves.

Same

      (17) The list of contributories settled by the liquidator under clause 16 (a) is admissible in evidence as proof, in the absence of evidence to the contrary, of the liability of the persons named in the list as contributories.

Meetings of credit union during winding-up

      (18) The liquidator may, during the continuance of the voluntary winding-up, call general meetings of the members of the credit union for the purpose of obtaining their approval by resolution or for any other purpose as the liquidator thinks fit.

Arrangements with creditors

      (19) The liquidator, with the approval of a resolution of the members of the credit union passed in general meeting, may make such compromise or other arrangement as the liquidator thinks expedient with any creditor or person claiming to be a creditor or having or alleging that the person has a claim, present or future, certain or contingent, liquidated or unliquidated, against the credit union or whereby the credit union may be rendered liable.

Power to compromise with debtors and contributors

      (20) The liquidator may , with the approval of a resolution of the members of the credit union passed in general meeting, compromise all debts and liabilities capable of resulting in debts and all claims, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist between the credit union and any contributory, alleged contributory or other debtor or person who may be liable to the credit union and all questions in any way relating to or affecting the property of the credit union, or the winding up of the credit union upon the receipt of the sums payable at such times and generally upon such conditions as are agreed, and the liquidator may take any security for the discharge of the debts or liabilities and give a complete discharge in respect of them.  1994, c. 11, s. 298 16-20.

Account to be made by liquidator

      (21) The liquidator shall make up an account , in a form approved by the Superintendent showing the manner in which the winding-up has been conducted and the property disposed of.  1994, c. 11, s. 298 (21); 1997, c. 19, s. 5 (4); 1999, c. 12, Sched. I, s. 2 (7).

Same

      (22) After the account is made up, the liquidator shall call a general meeting of the members and shareholders of the credit union for the purpose of having the account laid before them and hearing any explanation that may be given by the liquidator.

Calling meeting

      (23) The liquidator shall call the meeting in the manner set out in the credit union's articles or by-laws.  1994, c. 11, s. 298 22, 23.

Extension of time

      (24) The Superintendent may, by order in writing, extend the time for filing any documents required to be filed under this section if the Superintendent is satisfied that an extension is appropriate.  1994, c. 11, s. 298 (24); 1997, c. 28, s. 53.

Notice and dissolution

      299. (1) Following the meeting called under subsection 298 (22), the liquidator shall,

         (a)    within ten days after the meeting, file a notice with the Superintendent stating that the meeting was held and its date; and

        (b)    forthwith after filing the notice under clause (a), publish a notice in The Ontario Gazette setting out the date that the meeting was held and the date, proposed by the liquidator, for the dissolution of the credit union.

Restriction on dissolution date

      (2) The date proposed by the liquidator for the dissolution of the credit union must be at least three months after the date that the meeting called under subsection 298 (22) was held.

Deferral of date by court

      (3) At any time before the credit union is dissolved, the court may, on the application of the liquidator or any other interested person, make an order deferring the date on which the dissolution of the credit union is to take effect to a date fixed in the order.

Dissolution

     3.1 The credit union is dissolved on the date proposed by the liquidator unless the court makes an order under subsection 3), in which case the credit union is dissolved on the date fixed in the order.

Dissolution order

     (4) Despite anything in this Act, the court, at any time after the affairs of the credit union have been fully wound up may, on the application of the liquidator or any other interested person, make an order dissolving it, and it is dissolved on the date fixed in the order.  1994, c. 11, s. 299 2-4.

Winding up by court order

      300. (1) A credit union may be wound up by order of the court if,

         (a)    the members, by a special resolution passed at a general meeting called for that purpose, authorize an application to be made to the court to wind up the credit union;

         (b)    proceedings have been started to wind up the credit union voluntarily and it appears to the court that it is in the interest of contributories and creditors that the proceedings should be continued under the supervision of the court;

         (c)    it is proved to the satisfaction of the court that the credit union, though it may be solvent, cannot by reason of its liabilities continue its business and that it is advisable to wind it up; or

         (d)    in the opinion of the court it is just and equitable for some reason other than the bankruptcy or insolvency of the credit union that it should be wound up.  1994, c. 11, s. 300 (1).

If more than one class of shares

      (1.1) If the credit union has more than one class of issued shares, the special resolution referred to in clause 1 (a) shall be in the form of a special resolution passed by the holders of each class of shares.

Who may apply

      (2) A winding-up order may be made upon the application of,

         (a)    the credit union;

         (b)    a member of a credit union;

         (b.1)    a creditor having a claim of $5,000 or more;

         (c)    if the credit union is being wound up voluntarily, the liquidator or a contributor;

         (d)    the Superintendent; or

        (e)    the Corporation.  1994, c. 11, s. 300 (2); 1997, c. 28, s. 53.

Notice to credit union

      (3) Except if the application is made by the credit union, four days notice of the application must be given to the credit union.  1994, c. 11, s. 300 (3).

Notice to Superintendent

      (4) Except if the application is made by the Superintendent, four days notice of the application must be given to the Superintendent.  1994, c. 11, s. 300 (4); 1997, c. 28, s. 53.

Notice to Corporation

      (4.1) Except if the application is made by the Corporation, four days notice of the application must be given to the Corporation.

Power of court

      (5) The court may,

         (a)    make the order applied for;

         (b)    dismiss the application with or without costs;

         (c)    adjourn the hearing conditionally or unconditionally;

         (d)    make an interim or such other order as it considers appropriate; or

         (e)    refer the proceedings for the winding-up to an officer of the court for inquiry and report and authorize the officer to exercise such powers of the court as are necessary for the reference.

Appointment of liquidator

      (6) The court making the winding-up order may appoint one or more persons as liquidator of the estate and effects of the credit union for the purpose of winding up its affairs and distributing its property.

Remuneration

      (7) The court may at any time fix the remuneration of the liquidator and the costs, charges and expenses of the winding-up.

Vacancy

      (8) If a liquidator who is appointed by the court dies or resigns or the office becomes vacant for any reason, the court may fill the vacancy.

Removal

      (9) The court may, by order for cause, remove a liquidator appointed by it and appoint another liquidator in the stead of the removed liquidator.  1994, c. 11, s. 300 5-9.

Notice of appointment

      (10) A liquidator appointed by the court must,

         (a)    forthwith after the appointment, give notice to the Superintendent and the Corporation of the court order respecting the winding-up; and

         (b)    publish notice of the appointment in The Ontario Gazette.  1994, c. 11, s. 300 (0); 1997, c. 28, s. 53.

Start of winding-up

      (11) Repeal

Proceedings in winding-up after order

      (12) If a winding-up order has been made by the court, proceedings for the winding up of the credit union must be taken in the same manner and with the like consequences as are provided for a voluntary winding-up, except that,

         (a)    the list of contributories shall be settled by the court unless it has been settled by the liquidator before the winding-up order; and

         (b)    all proceedings in the winding-up are subject to the order and direction of the court.

Review by court

      (13) If the list of contributories has been settled by the liquidator before the winding-up order, it is subject to review by the court.

Meeting of members may be ordered

      (14) If a winding-up order has been made by the court, the court may direct meetings of the members of the credit union to be called, held and conducted in such manner as the court thinks fit for the purpose of ascertaining their wishes, and may appoint a person to act as chair of the meeting and to report the results of it to the court.

Order for delivery of property

      (15) If a winding-up order has been made by the court, the court may require any contributory for the time being settled on the list of contributories, or any director, employee, trustee, receiver, banker, agent or officer of the credit union, to pay, deliver, convey, surrender or transfer forthwith, or within such time as the court directs, to the liquidator any money, books, papers, registers and other records record, document, estate or effects that are in any such person's hands and to which the credit union is apparently entitled.

Inspection of documents and records

      (16) If a winding-up order is made by the court, the court may make an order for the inspection of the books, papers, registers and other records records and documents of the credit union by its creditors and contributories, and any documents and records records and documents in the possession of the credit union may be inspected in conformity with the order.

No proceeding against credit union without leave

      (17) After a winding-up order is made, no suit, action or other proceeding shall be proceeded with or commenced against the credit union, except with the leave of the court and subject to such terms as the court imposes.

      (17.1) Every attachment, sequestration, distress or execution put in force against the estate or effects of a credit union after a winding-up order is made is void.

Provision for discharge of liquidator and distribution by the court

      (18) If the realization and distribution of the property of a credit union being wound up under an order of the court has proceeded so far that, in the opinion of the court it is expedient that the liquidator should be discharged and that the property of the credit union remaining in the liquidator's hands can be better realized and distributed by the court, the court may make an order discharging the liquidator and for payment, delivery and transfer into court, or to such officer or person as the court directs, of such property, and it shall be realized and distributed by or under the direction of the court among the persons entitled thereto in the same way as nearly as may be as if the distribution were being made by the liquidator and the court may make an order directing how the documents and records records and documents of the credit union and of the liquidator are to be disposed of, and may order that they be deposited in court or otherwise dealt with as the court considers appropriate.

Order for dissolution

      (19) The court at any time after the affairs of the credit union have been fully wound up may, upon the application of the liquidator or any other interested person, make an order dissolving it, and it is dissolved on the date fixed in the order.  1994, c. 11, s. 300 12-19.

Notice to Superintendent

      (20) The person on whose application the order was made shall, within ten days after it was made, file with the Superintendent a certified copy of the order and the Superintendent shall cause notice of the dissolution to be given in The Ontario Gazette.  1994, c. 11, s. 300 (20); 1997, c. 28, s. 53.

Dissolution by Superintendent

     301. (1) The Superintendent , after the credit union has been given an opportunity to be heard by the Superintendent, may, by order, dissolve a credit union if he or she is satisfied that,

         (a)    its incorporation was obtained by fraud or mistake;

         (b)    it exists for an illegal purpose;

         (c)    the number of its members is reduced to fewer than twenty;

         (d)    it is not carrying on business or is not in operation; or

         (e)    it has contravened this Act or the regulations.  1994, c. 11, s. 301 (1); 1997, c. 28, s. 53.

Procedural rules

    (1.1) Section 240.1 applies with respect to an order under this section.

Appeal to Tribunal

    (1.2) The credit union that is subject to an order under this section may appeal the order to the Tribunal in accordance with section 240.4.

Order for dissolution Appointment of liquidator

    (2) If necessary, the Superintendent shall appoint a liquidator to carry out the dissolution. 1994, c. 11, s. 301 (2); 1997, c. 28, s. 53.

Liquidation

      (3) The liquidator, if one is appointed, shall proceed to wind up the credit union and subsections 298 (11) to 24) and 299  (1) apply thereto, except that no approval of the members of the credit union is required.  1994, c. 11, s. 301 (3).

Publishing order

      (4) The Superintendent shall publish notice of the dissolution in The Ontario Gazette.  1994, c. 11, s. 301 (4); 1997, c. 28, s. 53.

Modification with respect to leagues

 (5) For the purposes of the application of clause 1) c) to a league under section 243, the reference to "twenty" in clause 1) c) shall be deemed to be a reference to "ten".

Liability of members and shareholders to creditors

      302. (1) Despite the dissolution of a credit union, each of the members or shareholders among whom its property has been distributed other than the refunds of deposits, remains liable to its creditors to the extent of the amount received by the member or shareholder upon the distribution, and an action in a court of competent jurisdiction to enforce such liability may be brought against the member or shareholder.  1994, c. 11, s. 302 (1); 2002, c. 24, Sched. B, s. 32.

Action against one member or shareholder as representing a class

      (2) If there are several members or classes of shareholders, the court may permit an action to be brought against one or more members or one or more shareholders of each class of shareholders as representatives of the class of members or shareholders and, if the plaintiff establishes the plaintiff's claim as creditor, may make an order of reference and add as parties in the referee's office all such members or shareholders of each class of shareholders as are found, and the referee shall determine the amount that each should contribute towards the plaintiff's claim and may direct payment of the sums so determined.  1994, c. 11, s. 302 (2).

Forfeiture of undisposed property

      303. Subject to section 302, any real or personal property of a credit union that has not been disposed of at the date of its dissolution is forfeit to the Crown in right of Ontario.  1994, c. 11, s. 303.

Responsibilities of liquidator

      304. Upon a winding-up of a credit union,

         (a)    the liquidator shall apply the property of the credit union in satisfaction of all its debts, obligations and liabilities, and, subject thereto, shall distribute any remaining property rateably among the members or shareholders according to their rights and interests in the credit union;

         (b)    in distributing the property of the credit union, debts due to the employees of the credit union for services performed due at the commencement of the winding-up or within one month before, not exceeding three months wages and accumulated sickness benefits or vacation pay accrued for not more than twelve months, shall be paid in priority to the claims of the ordinary creditors, and such persons shall rank as ordinary creditors for any additional amount of their claims for wages;

         (c)    all the powers of the board of a credit union being wound up cease upon the appointment of a liquidator except to the extent that the liquidator may permit the continuance of these powers for the purpose of assisting the winding-up proceedings.  1994, c. 11, s. 304.

Distribution of property

      305. Section 53 of the Trustee Act applies with necessary modifications to liquidators.  1994, c. 11, s. 305.

Payment of costs and expenses

      306. The costs, charges and expenses of the winding-up including the remuneration of the liquidator are payable out of the property of the credit union in priority to all other claims.  1994, c. 11, s. 306.

Powers of liquidator

      307. (1) A liquidator may,

         (a)    bring or defend any action, suit or prosecution, or other legal proceedings, civil or criminal, in the name and on behalf of the credit union;

         (b)    carry on the business of the credit union so far as may be necessary for the beneficial winding up of the credit union;

         (c)    sell the real and personal property of the credit union by public auction or private sale;

         (d)    borrow money on behalf of the credit union as may be necessary for the winding up of the credit union;

         (e)    draw, accept, make and endorse any bill of exchange or promissory note in the name and on behalf of the credit union;

          (f)    raise upon the security of the property of the credit union such money as may be required;

         (g)    take out in the liquidator's official name, letters of administration of the estate of any deceased contributory and in that official name, do any other act that may be necessary for obtaining payment of any money due from a contributory or from his or her estate that cannot conveniently be done in the name of the credit union;

         (h)    do and perform all acts and other things and execute under the corporate seal or otherwise all documents in the name and on behalf of the credit union as may be necessary for winding up the affairs of the credit union and distributing its property;

          (i)    engage the services of a solicitor to assist in the performance of the liquidator's duty;

          (j)    employ an agent to do any business that the liquidator is unable to do directly;

         (k)    claim and, where necessary, prove any claim against the estate of a contributory for any debt or liability to the credit union;

          (l)    receive dividends in the distribution of an estate of a contributory in respect of any debt or liability mentioned in clause (k);

       (m)    compromise all calls, and liabilities to call, debts and liabilities capable of or resulting in debts, and all claims, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or alleged as subsisting between the credit union and any other person;

         (n)    do and execute all such other things as are necessary for winding up the affairs of the credit union and distributing its property.

Bills of exchange deemed drawn in the course of business

      (2) The execution, endorsement or making of all agreements, contracts, bills of exchange or other documents by a liquidator on behalf of a credit union has the same effect with respect to the rights and liabilities of the credit union as if the agreements, contracts or bills of exchange or other documents had been executed, endorsed or made by or on behalf of the credit union in the course of carrying on its business.  1994, c. 11, s. 307 1, 2.

Where approval required

      (3) The liquidator shall not exercise power granted under clause (1) (a), (d), (f), (m) or (n),

         (a)    in the case of a voluntary winding-up or a liquidator appointed by the Superintendent under section 301, unless the liquidator has obtained the approval in writing of the Superintendent; or

         (b)    in the case of a winding-up by order of the court, unless the liquidator has obtained the approval of the court.  1994, c. 11, s. 307 (3); 1997, c. 28, s. 53.

Exception

      (4) Clause 3 (a) does not apply where the Corporation is the liquidator.

Notice of liability of contributory

      (5) The liability of a contributory is a debt accruing due from the contributory at the time when the contributory's liability commenced, but payable at the time when calls are made for enforcing the liability.

Who liable in case of death

      (6) If a contributory dies before or after he or she is placed on the list of contributories, his or her personal representative, in administering the estate of the contributory, is liable to contribute to the property of the credit union in discharge of the liability of the deceased contributory and shall be a contributory accordingly.

Examination of persons as to estate

      (7) The court may, at any time after the commencement of the winding-up, summon to appear before the court or liquidator, any director, manager, employee or officer of the credit union, or any other person known or suspected to have possession of any of the estate or effects of the credit union, or alleged to be indebted to the credit union, or any person whom the court thinks capable of giving information concerning the dealings, estate or effects of the credit union.

Damages against delinquent directors, etc.

      (8) If, in the course of the winding-up of a credit union, it appears that a person who has taken part in the formation or promotion of the credit union or any past or present director, manager, officer, employee, liquidator or receiver of the credit union has misapplied or retained in the person's own hands, or become liable or accountable for money of the credit union, or has committed any misfeasance or breach of trust in relation to the credit union, the court may, on the application of a creditor, member, director, liquidator, or contributory, inquire into the conduct of that person and order the person to restore the money so misapplied or retained, or for which the person has become liable or accountable together with interest at such rate as the court considers just or to contribute such sum to the property of the credit union by way of compensation in respect of the misapplication, retention, misfeasance or breach of trust as the court considers just.  1994, c. 11, s. 307 4-8.

Disposal of records

      (9) If a credit union has been wound up under this Act and is about to be dissolved, the books, registers and other records and papers records and documents of the credit union and of the liquidator may be disposed of in such manner as,

         (a)    the Superintendent may order specify, in the case of voluntary winding up or a liquidator appointed by the Superintendent under section 301; or

         (b)    the court may order in the case of winding up under court order.  1994, c. 11, s. 307 (9); 1997, c. 28, s. 53.

Retention of records by custodian

9.1) A person who has been granted custody of the records and documents under subsection (9) shall keep them available for production for six years following the date of the dissolution of the credit union or until the expiration of such other period as may be specified by the Superintendent or ordered by the court under subsection (9).

Regulations

      (10) The Lieutenant Governor in Council may make regulations respecting the procedure to be followed in a winding-up, and, unless otherwise provided by this Act or by those regulations, the practice and procedure in a winding-up under the Winding-up and Restructuring Act Canada applies.  1994, c. 11, s. 307 (10).

Notice of winding-up proceedings

      308. If proceedings are taken under the Winding-up and Restructuring Act Canada in respect of a credit union, the secretary of the credit union shall send notice of the proceedings to the Superintendent by registered mail.  1994, c. 11, s. 308; 1997, c. 28, s. 53.

Security interests remaining after dissolution

      308.1 (1) If a credit union is dissolved without discharging a security interest given to the credit union, the Corporation may discharge that security interest or do anything else, in relation to that security interest, that the credit union could have done had it not been dissolved.

Clarification with respect to real property

      308.1 (2) For greater certainty, and without limiting what other security interests subsection (1) applies to, subsection (1) applies to liens, charges and mortgages or any other security interest in real property.

Amalgamations

Amalgamation of credit unions

      309. (1) Any two or more credit unions may amalgamate and continue as one credit union.

Amalgamation agreement

      (2) The credit unions proposing to amalgamate must enter into an agreement for the amalgamation prescribing the conditions of the amalgamation, the mode of carrying the amalgamation into effect, and, in particular, the agreement must set out the following:

           1.    The name corporate name of the amalgamated credit union.

           2.    The limitation on membership in the amalgamated credit union.

           3.    The name in full, callings and places of residence of the first directors of the amalgamated credit union.

           4.    The time and manner of election of subsequent directors of the amalgamated credit union.

           5.    The manner of converting the share capital of each of the amalgamating credit unions into that of the amalgamated credit union.

           6.    If any membership shares of one of the credit unions are not to be converted into membership shares of the amalgamated credit union, the amount of money or securities that the members are to receive in addition or instead of membership shares of the amalgamated credit union.

           7.    If any shares of one of the credit unions 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 the shares are to receive in addition or instead of shares or other securities of the amalgamated credit union.

           8.    The manner of payment of money instead of the issue of fractional shares of the amalgamated credit union or of any other body corporate that are to be issued in the amalgamation.

           9.    Such other details as are necessary to perfect the amalgamation and to provide for the subsequent management and operation of the amalgamated credit union.

         10.    The proposed effective date of the amalgamation.  1994, c. 11, s. 309 1, 2.

Filing of agreement

      (3) Within one month after the agreement is signed, the parties must file with the Superintendent, in triplicate, true copies of the amalgamation agreement and pay the fee established by the Minister. 1994, c. 11, s. 309 (3); 1997, c. 28, s. 53.

Approvals required

      (4) The agreement is subject to the approval of the Superintendent and to adoption by special resolutions of the members of each of the amalgamating credit unions, passed at meetings called for the purpose of considering the agreement.

If more than one class of shares

     (4.1)  If the credit union has more than one class of issued shares, each special resolution referred to in subsection (4) shall be in the form of a special resolution passed by the holders of each class of shares.

Refusal of approval to be by order

     (4.2)  If the Superintendent refuses to approve the agreement, the Superintendent shall do so by order.

Procedural rules

     (4.3)  Section 240.1 applies with respect to an order under subsection 4.2.

Appeal to Tribunal

     (4.4)  The credit union that is subject to an order under subsection 4.2 may appeal the order to the Tribunal in accordance with section 240.4.

Meeting

      (5) The meeting to approve the amalgamation must be held within one month after the approval of the Superintendent is given.  1994, c. 11, s. 309 (5); 1997, c. 28, s. 53.

Certification

      (6) If the amalgamation is approved, that fact must be certified upon the agreement by the secretary of each of the amalgamating credit unions.  1994, c. 11, s. 309 (6).

Extension of time

      (7) The Superintendent may extend the time within which the meeting to approve the amalgamation must be held if there are reasonable grounds for doing so.  1994, c. 11, s. 309 (7); 1997, c. 28, s. 53.

Application for certificate

      (8) If the agreement is adopted, the amalgamating credit unions may apply jointly for a certificate of amalgamation by submitting an application to the Superintendent together with articles of amalgamation.

Certificate of amalgamation

      (8.1) The Superintendent may, in his or her discretion, issue a certificate of amalgamation which shall set out the effective date of the amalgamation.

Grounds for refusing certificate

      (8.2) Subsection 16 (2) applies, with necessary modifications, with respect to the issue of a certificate of amalgamation.

Amalgamation and effects

      (9) On and after the effective date of the amalgamation,

         (a)    the amalgamating credit unions are amalgamated and are continued as one credit union under the name corporate name set out in the certificate;

         (b)    the amalgamated credit union possesses all the property, rights, privileges and franchises and is subject to all the liabilities, contracts, disabilities and debts of each of the amalgamating credit unions; and

         (c)    the articles of amalgamation shall be deemed to be the articles of incorporation of the amalgamated credit union and the certificate of amalgamation shall be deemed to be the certificate of incorporation of the amalgamated credit union.  1999, c. 12, Sched. I, s. 2 (8).

Notice

      (10) The Minister The Superintendentshall publish notice of the issue of the certificate of amalgamation in The Ontario Gazette.  1994, c. 11, s. 309 (10).

Statement of assets and liabilities

    (11) The amalgamated credit union shall file with the Superintendent, within 60 days after the effective date of the amalgamation, a statement of the assets and liabilities of the amalgamated credit union as of the date of the certificate.

Amalgamation of credit unions under administration

      310. (1)  If a credit union is under the administration of the Corporation, the Corporation may require the credit union to enter into an amalgamation agreement or do anything else under section 309.

Application of s. 309

    (2)  If the Corporation requires a credit union under the administration of the Corporation to enter into an amalgamation agreement under section 309, the following apply with respect to the application of section 309:

                        i)    protect the interests of the depositors or members of the credit unions being amalgamated; and

                       ii)    promote the financial security and integrity of the amalgamated credit union.

Reorganization

Articles of amendment

      311. (1) A credit union may from time to time amend its articles of incorporation to,

       (a)    limit its business or powers or otherwise vary its business or powers;

        (b)    change its name corporate name; or

      (c)    add, change or remove any provision that,

                     (i)    is authorized by this Act to be set out in the articles, or

                    (ii)    could be subject to a by-law of the credit union.

Authorization

      (2) An amendment under subsection (1) must be authorized by special resolution of members and such further authorization as the by-laws provide.  1994, c. 11, s. 311.

Class vote

      312. (1) The holders of shares of a class or of a series are entitled to vote separately as a class or series on a proposal to amend the articles to,

         (a)    increase or decrease any maximum number of authorized shares of that class, or increase any maximum number of authorized shares of a class having rights or privileges equal or superior to the shares of that class;

         (b)    effect an exchange, reclassification or cancellation of all or part of the shares of that class;

         (c)    add, change or remove the rights, privileges, restrictions or conditions attached to the shares of that class and, without limiting the generality of the foregoing,

                        i)    prejudicially remove or change rights to accrued dividends or rights to cumulative dividends,

                       ii)    prejudicially add, remove, or change redemption rights,

                     iii)    reduce or remove a dividend preference or a liquidation preference, or

                      iv)    prejudicially add, remove or change conversion privileges, options, voting, transfer or pre-emptive rights, or rights to acquire securities of the credit union;

         (d)    increase the rights or privileges of any class of shares having rights or privileges equal or superior to the shares of that class;

         (e)    create a new class of shares equal or superior to the shares of that class;

          (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.

Exception

      (2) Subsection (1) does not apply to membership shares.

Same

      (3) Subsection (1) does not apply in the case of amendments to the articles referred to in clause (1)(a), (b) or (e) if the articles so provide.

Right limited

      (4) Subject to subsection (3), the holders of a series of shares of a class are entitled to vote separately as a series under subsection (1) if that series is affected by an addition or amendment to the articles in a manner different from other shares of the same class.

Right to vote

      (5) Subsections (1) and (4) apply whether or not the shares of a class otherwise carry the right to vote.  1994, c. 11, s. 312.

Required documentation

      313. The credit union must deliver to the Superintendent, within six months sixty days after the special resolution has been confirmed by its members and affected shareholders, articles of amendment in duplicate, signed by two officers, or by one director and one officer, of the credit union and verified by affidavit of one of the officers or directors signing the articles of amendment, setting out,

         (a)    the name corporate name of the credit union;

         (b)    a certified copy of the special resolution;

         (c)    that the amendment has been duly confirmed and authorized; and

         (d)    the date of the confirmation of the special resolution by the members and affected shareholders.  1994, c. 11, s. 313; 1997, c. 28, s. 53.

Certificate of amendment

      314. (1) If the articles of amendment conform to law, the Superintendent shall, when all fees established by the Minister have been paid,

         (a)    endorse on each duplicate of the articles of amendment the word "Filed/Déposé" and the day, month and year of the filing thereof;

         (b)    file one of the duplicates in the Superintendent's office; and

         (c)    issue to the credit union or its agent a certificate of amendment to which the Superintendent shall affix the other duplicate.  1994, c. 11, s. 314 (1); 1997, c. 19, s. 5 (5); 1997, c. 28, s. 53.

Effect of certificate

      (2) The amendment becomes effective upon the date set out in the certificate of amendment and the articles of incorporation are amended accordingly.  1994, c. 11, s. 314 (2).

Restatement of articles

      315. (1) Subject to subsections (2) and (3), a credit union may at any time restate its amended articles of incorporation.  1994, c. 11, s. 315 (1).

Filing of restatement

      (2) The credit union shall deliver to the Superintendent the restated articles in duplicate, signed by two officers, or by one director and one officer, of the credit union and verified by affidavit of one of the officers or directors signing the restated articles, setting out,

        (a)    all the provisions that are then set out in the original articles of incorporation as amended; and

        (b)    a statement that the restated articles correctly set out, without change, the corresponding provisions of the original articles as amended.  1994, c. 11, s. 315 (2); 1997, c. 28, s. 53.

Certificate of restatement

      (3) If the restated articles of incorporation conform to law, the Superintendent shall, when all fees established by the Minister have been paid,

        (a)    endorse on each duplicate of the restated articles the word "Filed/Déposé" and the day, month and year of the filing thereof;

        (b)    file one of the duplicates in the Superintendent's office; and

       (c)    issue to the credit union or its agent a restated certificate of incorporation to which the Superintendent shall affix the other duplicate.  1994, c. 11, s. 315 (3); 1997, c. 19, s. 5 (5); 1997, c. 28, s. 53.

Effect of certificate

      (4) The restated articles of incorporation become effective upon the date set out in the restated certificate and supersede the original articles of incorporation and all amendments to them.  1994, c. 11, s. 315 (4).

CONTINUING AS OR CEASING TO BE AN ONTARIO CREDIT UNION

Continuance as an Ontario credit union

      316. (1) A body corporate incorporated under the laws of another jurisdiction in Canada other than Ontario or under another Ontario Act may, if authorized by the laws of that other jurisdiction or under that other Ontario Act, apply to the Superintendent for a certificate of continuance.

Authorization

      (2) If a body corporate has shareholders, the application must be authorized by a special resolution of the shareholders.

Articles of continuance, etc.

      (3) Articles of continuance shall be sent to the Superintendent together with a copy of the special resolution required under subsection (2) and any other prescribed documents.

Requirements for articles

      (4) The articles of continuance shall make any amendments to the original or restated articles of incorporation, articles of amalgamation, letters patent, supplementary letters patent, a special Act and any other instrument by which the body corporate was incorporated and any amendments thereto necessary to make the articles of continuance conform to the laws of Ontario, and may make such other amendments as would be permitted under this Act if the body corporate were incorporated under this Act, provided that at least the same shareholder approval has been obtained for such other amendments as would have been required if the body corporate were incorporated under this Act.

Issue of certificate of continuance

     (5) Upon receipt of the articles of continuance and the other required documents, the Superintendent may, subject to any prescribed conditions, issue a certificate of continuance on such terms and subject to such limitations and conditions as the Superintendent considers proper.

Grounds for refusing certificate

      (6) Subsection 16 (2) applies, with necessary modifications, with respect to the issue of a certificate of continuance.

Effect of certificate

      (7) The articles of continuance become effective on the date set out in the certificate of continuance and, as of that date,

    (a)  the body corporate is continued as a credit union under this Act as though it had been incorporated under this Act;

    (b)  the articles of continuance are deemed to be the articles of incorporation of the continued credit union; and

    (c)  the certificate of continuance is deemed to be the certificate of incorporation of the credit union.

Copy of certificate to other jurisdiction, etc.

      (8)  The Superintendent shall send a copy of the certificate of continuance,

    (a) to the appropriate official or public body for the jurisdiction in which the body corporate was incorporated; or

    (b) if the body corporate was incorporated under another Ontario Act, to the appropriate official or public body for the other Ontario Act.

Rights, liabilities, etc., preserved

      (9)  If a body corporate is continued as a credit union under this Act,

    (a) the credit union possesses all the property, rights, privileges and franchises and is subject to all the liabilities, including civil, criminal and quasi-criminal, and all contracts, disabilities and debts of the body corporate;

    (b) a conviction against, or ruling, order or judgment in favour of or against, the body corporate may be enforced by or against the credit union; and

    (c) the credit union shall be deemed to be the party plaintiff or the party defendant, as the case may be, in any civil action commenced by or against the body corporate.

Notice

      (10)  The Superintendent shall publish notice of the issue of the certificate of continuance in The Ontario Gazette.

Transition - outstanding debt and assets, etc.

      (11)  The Superintendent may, by order, allow a continued credit union to,

    (a) have outstanding debt obligations which are not authorized by this Act if the debt obligations were outstanding at the time the application for the certificate of continuance was made, for such period and under such conditions as the Superintendent may order;

    (b) hold assets, including loans, that a credit union is not otherwise permitted by this Act to hold if the assets were held at the time the application for the certificate of continuance was made, for such period and under such conditions as the Superintendent may order;

    (c) acquire and hold assets, including loans, that a credit union is not otherwise permitted by this Act to acquire or hold if the body corporate continued as the credit union was obliged, at the time the application for the certificate of continuance was made, to acquire those assets, for such period and under such conditions as the Superintendent may order.

Limits on transition period

      (12)  The following apply with respect to a period mentioned in clause (11) (a), (b) or (c):

    1. The period may not exceed the prescribed maximum period.

    2. The Superintendent may extend the period but only for a further period that does not exceed the prescribed maximum extension period.

Transfer to another jurisdiction

      316.1 (1) A credit union may, if it has been issued a certificate of approval of continuance under this section, apply to the appropriate official or public body of another jurisdiction in Canada requesting that the credit union be continued as if it had been incorporated under the laws of that other jurisdiction.

Application for certificate of approval

       (2) A credit union may apply to the Superintendent for a certificate of approval of continuance.

Authorization

       (3) An application must be authorized by a special resolution of the members of the credit union.

If more than one class of shares

       (4)  If the credit union has more than one class of issued shares, the special resolution referred to in subsection (3) shall be in the form of a special resolution passed by the holders of each class of shares.

Issue of certificate of approval

       (5)  The Superintendent may, subject to any prescribed conditions, issue a certificate of approval of continuance if the Superintendent is satisfied as to the following:

       1  If the credit union is to be continued as a deposit-taking institution, the deposits held by the institution will be insured or guaranteed by the deposit insurer or similar entity for the jurisdiction under whose laws the credit union is to be continued.

       2 If the credit union is to be continued as a body corporate other than a deposit-taking institution, the body corporate will not hold any deposits when it is continued.

Copy of certificate to other jurisdiction

       (6)  The Superintendent shall send a copy of the certificate of approval of continuance to the appropriate official or public body for the jurisdiction under whose laws the credit union is to be continued.

Effect of continuation in other jurisdiction

       (7) When a credit union is continued under the laws of another jurisdiction following the issue of a certificate of approval of continuance, the credit union ceases to be a credit union for the purposes of this Act.

Filing and notice

       (8) A credit union that is continued under the laws of another jurisdiction shall file a copy of the instrument of continuance with the Superintendent and the Superintendent shall publish notice of the continuation in The Ontario Gazette.

Continuation under other Ontario Act

      316.2 (1) A credit union may, if it has been issued a certificate of approval of continuance under this section, apply under another Ontario Act to be continued as if it had been incorporated under that other Act.

Application for certificate of approval

       (2)  A credit union may apply to the Superintendent for a certificate of approval of continuance.

Authorization

       (3)  An application must be authorized by a special resolution of the members of the credit union.

If more than one class of shares

       (4)  If the credit union has more than one class of issued shares, the special resolution referred to in subsection (3) shall be in the form of a special resolution passed by the holders of each class of shares.

Issue of certificate of approval

       (5) The Superintendent may, subject to any prescribed conditions, issue a certificate of approval of continuance if the Superintendent is satisfied that the credit union, when it is continued under that other Ontario Act, will not hold any deposits.

Copy of certificate to other official

       (6) The Superintendent shall send a copy of the certificate of approval of continuance to the appropriate official or public body under the other Ontario Act.

Effect of continuation under other Act

       (7) When a credit union is continued under another Ontario Act following the issue of a certificate of approval of continuance, the credit union ceases to be a credit union for the purposes of this Act.

Filing and notice

       (8) A credit union that is continued under another Ontario Act shall file a copy of the instrument of continuance with the Superintendent and the Superintendent shall publish notice of the continuation in The Ontario Gazette.

PART XVI
REGULATIONS, APPROVAL OF FORMS AND ESTABLISHMENT OF FEES

REGULATION

Regulations: general

      317.  (1)  The Lieutenant Governor in Council may make regulations,

           1.    Repealed:  1997, c. 19, s. 5 (7).

           2.    Repealed:  1997, c. 19, s. 5 (7).

           3.    respecting the holding of first meetings, the notice calling the meeting, the quorum, and the business to be transacted;

           4.    prescribing matters to be shown in financial statements under subsection 213 (1) and the periods to which those matters relate;

           5.    governing credit unions and leagues of credit unions;

           6.    governing the operations and powers of branches of credit unions;

           7.    Repeal

           8.    respecting the management of risk in making loans and investments and in the general management of a credit union's business;

           9.    Repealed:  1997, c. 19, s. 5 (7).

         10.    respecting the records, papers and documents> books, registers and other records and documentsto be retained kept and maintinaed by credit unions and the length of time they are to be retained;

         11.    defining, for the purposes of this Act and the regulations, any word or expression used in this Act that is not defined in the Act;

         12.    prohibiting or restricting the sale by credit unions of a product or service on condition that another product or service is acquired from any person;

         13.    prescribing any matter authorized by this Act to be prescribed by the regulations or referred to as prescribed;

         14.    defining the interests of a credit union in real property and determining the method of valuing those interests;

         15.    regulating the extent to which credit unions are permitted to undertake the business of insurance or prohibiting them from undertaking the business of insurance;

         16.    governing the business of insurance as undertaken by credit unions;

         17.    respecting the relations between credit unions and,

                          i.    entities that undertake the business of insurance, and

                         ii.    insurance agents or insurance brokers;

         17.1   permitting credit unions to undertake fiduciary activities;

         18.    respecting networking arrangements between credit unions and other persons providing products or services to credit unions or its members;

         19.    prohibiting or restricting networking arrangements;

         20.    governing the conduct of credit unions in networking arrangements;

         21.    respecting the protection of members of credit unions and of the public in their dealings with credit unions including the regulating of representations that may be made by credit unions;

         22.    prescribing and regulating,

                          i.    classes of loans, and

                         ii.    Repeal

                       iii.    aggregate and individual lending limits for credit unions and methods of calculating limits;

         23.    prescribing the type and value of security that a credit union must have before making a loan and the method for valuing such security;

         24.    prescribing procedures to be followed by credit unions in dealing with consumer complaints by members or depositors;

         25.    respecting the retention, in Canada, of assets of a credit union;

         26.    requiring the disclosure to borrowers of terms and conditions of loans and mortgages and of interest rates in lending transactions and to depositors, the rate of interest on their accounts and the manner of calculating and paying the interest;

Note: On a day to be named by proclamation of the Lieutenant Governor, paragraph 26 is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule I, subsection 2 (9) and the following substituted:

         26.    requiring the disclosure to depositors of the rate of interest on their accounts and the manner of calculating and paying the interest;

See: 1999, c. 12, Sched. I, ss. 2 (9), 8 (2).

         27.    requiring the bonding of and insurance coverage for directors, officers, agents and employees of the credit union and of property of or held by the credit union;

         28.    governing the use of confidential information by the credit unions , stabilization authorities and the Corporation;

         29.    prescribing the discretionary authorities that may be conferred in proxies and excluding the application of similar provisions in regulations made under Part VIII of the Business Corporations Act;

         30.    authorizing the Corporation to provide services prescribed by the regulations that are ancillary, complementary or similar to services it performs as deposit insurer or stabilization authority to persons, bodies or classes of persons or bodies prescribed by the regulations, and governing the provision of those services. 1994, c. 11, s. 317 (1); 1997, c. 19, s. 5 6, (7); 2002, c. 18, Sched. H, s. 3 (11).

         31.    governing credit unions registered under subsection 332 (4), including providing for provisions of this Act to apply to such credit unions with such modifications as may be specified in the regulations.

Same

      (2)  A regulation made under this Act may,

         a)    be made applicable generally or to a specific credit union, league or class of credit unions or leagues;

         b)    define classes of credit unions, leagues or assets for the purpose of the regulations, including classes that may include only one credit union, league or asset; and

         c)    provide differently for different credit unions, for different classes of credit unions, for different leagues, for different classes of leagues, for different assets or for different classes of assets.  1994, c. 11, s. 317 (2).

Same

      (3)  A regulation may adopt by reference, in whole or in part, with such changes as the Lieutenant Governor in Council considers necessary, any code, standard or guideline, as amended from time to time, whether before or after the regulation is filed, and may require compliance with any code, standard or guideline adopted.  1994, c. 11, s. 317 (3).

Same

      (4)  If an amount or rate is to be prescribed under subsection (1), the regulation may prescribe a method of determining the amount or rate.  1994, c. 11, s. 317 (4).

Regulations: offering statements

      318. The Lieutenant Governor in Council may make regulations,

         a)    Repealed:  1997, c. 19, s. 5 (7).

         b)    specifying the financial statements, reports and other documents that are to be included with an offering statement;

         c)    respecting the disclosure of material facts in relation to securities to be distributed;

         d)    respecting the distribution of an offering statement;

         e)    exempting any class of distributions from the application of sections 75 to 83 82;

          f)    generally, for carrying out the purposes of sections 75 74.1 to 83 82.  1994, c. 11, s. 318; 1997, c. 19, s. 5 (7).

Regulations: capital adequacy

      319. The Lieutenant Governor in Council may make regulations,

         a)    regulating the maintenance, by credit unions, of adequate capital and adequate and appropriate forms of liquidity;

         b)    respecting regulatory capital and the total assets of a credit union;

         c)    prescribing phase-in periods for capital adequacy requirements based on a graduated scale;

         d)    adopting by reference any code, standard or guideline in respect of capital adequacy requirements;

         e)    requiring compliance with any regulation, administrative directive, or prescribed requirement, code, standard or guideline.  1994, c. 11, s. 319; 1997, c. 19, s. 5 (7).

Regulations: deposit insurance premiums

      319.1 (1) The Lieutenant Governor in Council may make regulations prescribing how annual premiums are to be determined under paragraph 1 of subsection 276.1 (1).

Same

       (2) A regulation under subsection (1) may prescribe different annual premiums for different credit unions or classes of credit unions.

Limitation

       (3) For the purposes of subsection (2), prescribed classes of credit unions shall be based in part on measurable criteria which relate to the risk posed by the credit union and may be based in part on other factors so long as they are not based on membership in a league.

Regulations: training programs

      320. Repeal

Regulations: audit committee

      321. The Lieutenant Governor in Council may make regulations prescribing the duties and functions powers and duties of audit committees.  1994, c. 11, s. 321.

      321.0.1 (1)  The Lieutenant Governor in Council may make regulations governing the administrative penalties that may be imposed under section 331.2 or 331.3.

Same

       (2)  Without limiting the generality of subsection (1), a regulation governing administrative penalties may,

       (a)  prescribe criteria the Superintendent or Corporation is required or permitted to consider when imposing a penalty under section 331.2 or 331.3;

       (b) authorize the Superintendent or Corporation to determine the amount of a penalty, if the amount of the penalty is not prescribed, and prescribe criteria the Superintendent or Corporation is required or permitted to consider when determining the amount of the penalty;

       (c) establish different penalties or ranges of penalties for different types of contraventions and for different classes of persons and entities;

       (d) authorize a penalty to be levied for each day or part of a day on which a contravention continues;

       (e)  authorize higher penalties for a second or subsequent contravention by a person or entity;

       (f) require that the penalty be paid before a specified deadline or before a deadline specified by the Superintendent or Corporation;

       (g) authorize the imposition of late payment fees respecting penalties that are not paid before the deadline, including graduated late payment fees;

       (h) establish a maximum cumulative penalty payable in respect of a contravention or in respect of contraventions during a specified period.

APPROVAL OF FORMS, ETC.

Forms

      321.1 The Superintendent may approve the use of forms, specify the procedure for the use of the forms, and require their use for any purpose of this Act, and the forms may provide for such information to be furnished as the Superintendent may require.  1997, c. 19, s. 5 (8); 1999, c. 12, Sched. I, s. 2 (10).

Reports

      321.2 The Superintendent may approve the form and contents of any report required to be prepared under this Act or the regulations and the manner of reporting.  1997, c. 19, s. 5 (8); 1999, c. 12, Sched. I, s. 2 (10).

Circulars and proxies

      321.3 The Superintendent may approve the form and content of information circulars and proxies.  1997, c. 19, s. 5 (8); 1999, c. 12, Sched. I, s. 2 (10).

Statements

      321.4 The Superintendent may approve the form and content of an offering statement or a statement of material changes.  1997, c. 19, s. 5 (8); 1999, c. 12, Sched. I, s. 2 (10).

Report on capital adequacy

      321.5 Repeal

ESTABLISHMENT OF FEES

Fees

      321.6 The Minister may establish and charge fees for anything required or permitted to be done by this Act or the regulations.  1997, c. 19, s. 5 (8).

PART XVII
OFFENCE OFFENCES AND ADMINISTRATIVE PENALTIES

OFFFENCES

Offence, general

      322. (1) Every person who contravenes any provision of this Act or the regulations or an order of the Superintendent or the Corporation is guilty of an offence.  1994, c. 11, s. 322 (1); 1997, c. 28, s. 53.

Officers, agents, etc.

      (2) If an entity commits an offence under this Act, every director, officer or agent of the entity who authorized, permitted or acquiesced in the offence is a party to and guilty of the offence and is liable, on summary conviction, to the penalty for the offence whether or not the entity has been prosecuted or convicted.

Penalty

      (3) A person who is guilty of an offence referred to in this section is liable,

         a)    in the case of an entity, on a first conviction to a fine of not more than $100,000 and on each subsequent conviction to a fine of not more than $200,000; and

         b)    in the case of an individual,

                        i)    on a first conviction, to a fine of not more than $100,000 or to imprisonment for not more than two years or both, and

                       ii)    on each subsequent conviction, to a fine of not more than $200,000 or to imprisonment for not more than two years or to both.  1994, c. 11, s. 322 2, 3.

Offences, other

     323. Repeal

Failure to pay Corporation

      (2) A credit union that is in default of payment of any assessment made on it by, or annual premium payable to the deposit insurer or a stabilization authority is guilty of an offence and upon conviction is liable to a fine of not more than $500 for each day the default continues.  1994, c. 11, s. 323 (2).

Failure to pay Ministry or L. G. in C.

      (3) A credit union that is in default of payment of any assessment made on it by the Ministry of Finance or the Lieutenant Governor in Council is guilty of an offence and upon conviction is liable to a fine of not more than $500 for each day the default continues.  1994, c. 11, s. 323 (3); 1997, c. 28, s. 62.

Order to comply

      324. If a person is convicted of an offence under this Act the court making the conviction, in addition to any penalty it may impose, may order that person to comply with the provisions of this Act or the regulations for the contravention of which the person has been convicted.  1994, c. 11, s. 324.

Restitution

      325. If a person is convicted of an offence under this Act, the court making the conviction, may, in addition to any other penalty, order the person convicted to pay compensation or make restitution in relation to the offence to any person suffering a loss because of the offence.  1994, c. 11, s. 325.

Repaying benefits

      326. (1) If a person has been convicted of an offence under this Act, the court may order the convicted person to pay an amount equal to the court's estimation of the amount of any monetary benefits acquired by the convicted person or accruing to the convicted person or to the spouse or a dependant of the person.  1994, c. 11, s. 326 (1); 1999, c. 6, s. 19 (6); 2005, c. 5, s. 18 (6).

Same

      (2) Subsection 1) applies even though the maximum fine has been imposed on the convicted person.  1994, c. 11, s. 326 (2).

Order to comply

      327. (1) If a credit union or any director, officer, employee or agent of a credit union does not comply with any provision of this Act, the regulations, the by-laws of the Corporation orthe articles of incorporation or by-laws of the credit union, the Superintendent, the Corporation or a member or any creditor of the credit union may apply to the court for an order directing the credit union, director, officer, employee or agent to comply with, or restraining the credit union, director, officer, employee or agent from acting in breach of the provision.  1994, c. 11, s. 327 (1); 1997, c. 28, s. 53.

Additional order

      (2) On an application under subsection (1), the court may make the order applied for and such further order it thinks appropriate.  1994, c. 11, s. 327 (2).

Restricted party transaction

      328. Repeal

Effect of contravention

      329. A contravention of a provision of this Act or the regulations does not invalidate a contract entered into in contravention of the provision unless otherwise expressly provided in this Act.  1994, c. 11, s. 329.

Effect of penalty

      330. The fact that a person is subject to or has paid a penalty for an offence under this Act does not relieve that person from any other liability in a civil proceeding.  1994, c. 11, s. 330.

Limitation period

      331. No proceeding for an offence under this Act shall be started more than two years after the facts on which the proceedings are based first came to the knowledge of the Superintendent.  1994, c. 11, s. 331; 1997, c. 28, s. 53.

ADMINISTRATIVE PENALITES

Administrative penalties

      331.1 (1) An administrative penalty may be imposed under section 331.2 or 331.3 for either of the following purposes:

       1. To promote compliance with the requirements established under this Act.

       2. To prevent a person or entity from deriving, directly or indirectly, any economic benefit as a result of contravening a provision of this Act or the regulations.

Same

       (2) An administrative penalty may be imposed alone or in conjunction with any other regulatory measure provided by this Act, including any other order under this Act or the cancellation of deposit insurance under section 274.

Superintendent - administrative penalties

      331.2 (1) If the Superintendent is satisfied that a person or entity is contravening a requirement described in subsection (2), the Superintendent may, by order, impose an administrative penalty on the person or entity in accordance with this section and the regulations.

Requirements for which penalties can be imposed

       (2) The requirements referred to in subsection (1) are the following:

       1. A requirement under subsection 107 (2) to file copies of a by-law.

       2. A requirement, by the Superintendent under subsection 220 (1), to hold a meeting.

       3. A requirement, by the Superintendent under section 225, to provide information.

       4. Such other requirements, as may be prescribed, under provisions of this Act or the regulations.

Opportunity to make submissions

       (3) Before imposing a penalty, the Superintendent shall give the person or entity a reasonable opportunity to make written submissions.

Limitation

       (5)  The Superintendent shall not make an order under this section more than two years after the day the Superintendent became aware of the contravention.

Appeals of administrative orders to Tribunal

       (5)  The person or entity that is subject to an order under this section may appeal the order to the Tribunal in accordance with section 240.4.

Variation on application of s. 240.4

       (6)  The powers of the Tribunal under subsection 240.4 (8) to confirm, vary or revoke an order under this section are subject to the limits, if any, established by the regulations.

Corporation - administrative penalties

      331.3 (1) If the Corporation is satisfied that a person or entity is contravening a requirement described in subsection (2), the Corporation may, by order, impose an administrative penalty on the person or entity in accordance with this section and the regulations.

Requirements for which penalties can be imposed

       (2)  The requirements referred to in subsection (1) are the following:

       1.  A requirement to provide reports to such persons and at such times as required by the Corporation under section 89.

       2. A requirement, by the Corporation under subsection 220 (1), to hold a meeting.

       3. A requirement, by the Corporation under section 225, to provide information.

       4.  A requirement under section 226 to file an annual return or provide information.

       5.  A requirement to pay a special levy under clause 262 (1) (i) or an annual premium determined under section 276.1.

       6.  Such other requirements, as may be prescribed, under provisions of this Act or the regulations.

Opportunity to make submissions

       (3)  Before imposing a penalty, the Corporation shall give the person or entity a reasonable opportunity to make written submissions.

Limitation

       (4)  The Corporation shall not make an order under this section more than two years after the day the Corporation became aware of the contravention.

Appeals of administrative orders to Tribunal

       (5)  The person or entity that is subject to an order under this section may appeal the order to the Tribunal in accordance with section 240.4.

Variation on application of s. 240.4

       (6)  The powers of the Tribunal under subsection 240.4 (8) to confirm, vary or revoke an order under this section are subject to the limits, if any, established by the regulations.

Effect of paying penalty

      331.4 If a person or entity pays the administrative penalty in accordance with the terms of an order under section 331.2 or 331.3 or, if the order is varied on appeal, in accordance with the terms of the varied order, the person or entity cannot be charged with an offence under this Act in respect of the same contravention.

Maximum administrative penalties

      331.5 An administrative penalty imposed under section 331.2 or 331.3 shall not exceed $25,000 or such lesser amount as may be prescribed for the contravention of a requirement specified in the regulations.

Enforcement of administrative penalties

      331.6 (1) If a person or entity fails to pay an administrative penalty imposed under section 331.2 or 331.3 in accordance with the terms of the order imposing the penalty, the person who made the order may file the order with the court and the order may be enforced as if it were an order of the court.

Same

     (2) For the purposes of section 129 of the Courts of Justice Act, the date on which the order is filed with the court shall be deemed to be the date of the order.

Same

     (3)  An administrative penalty that is not paid in accordance with the terms of the order imposing the penalty is a debt due to the Crown and is also enforceable as such.

PART XVIII
MISCELLANEOUS

Extra-provincial credit unions

      332. (1) If the Government of Ontario has entered into an agreement providing for reciprocal rights for credit unions with the government of a province or territory of Canada, a credit union incorporated under the laws of that province or territory may register under this Act for such purposes as are specified in the agreement.  1994, c. 11, s. 332 (1).

Register

      (2) The Superintendent shall maintain the Extra-Provincial Credit Unions Register and shall record in it the names of the credit unions registered and the limited purposes to which they are subject in Ontario.  1994, c. 11, s. 332 (2); 1997, c. 28, s. 53.

Condition precedent to licence

      (3) No credit union that is an extra-provincial corporation within the meaning of the Extra-Provincial Corporations Act shall be licensed under that Act as an extra-provincial corporation unless it has been first registered under this Act by the Superintendent.  1994, c. 11, s. 332 (3); 1997, c. 28, s. 53.

Registration of credit unions to take deposits

      (4) The Superintendent may, subject to any prescribed conditions, register a credit union in the Extra-Provincial Credit Unions Register for the purpose of allowing the credit union to borrow money from the public by receiving deposits and lending or investing such money.

Limitation

      (5) A credit union shall not be registered under subsection (4) unless the deposits taken in Ontario are insured or guaranteed by the deposit insurer or similar entity for the jurisdiction under whose laws the credit union was incorporated.

Special rules for credit unions taking deposits

      (6) The following apply with respect to a credit union registered under subsection (4):

      1. The credit union shall be deemed to be a credit union under this Act for the purposes of the Loan and Trust Corporations Act and such other statutes and regulations as may be prescribed.

      2. This Act shall not apply with respect to a credit union registered under subsection (4), except as provided in the regulations.

     333. Repealed:  1997, c. 28, s. 63.

Initial review

      334. (1)  Within five years after [this section comes into force], the Minister shall appoint one or more persons to review the operation of this Act and the regulations and to make recommendations to the Minister.

Subsequent review

      (2)  The Minister shall, no later than five years after the appointment under subsection (1), appoint one or more persons to conduct a subsequent review and shall, no later than five years after the most recent appointment under this subsection, appoint one or more persons to conduct subsequent reviews.

Public Consultation

      (3) When conducting a review, the appointees shall solicit the views of the public.

Public inspeciton

      (4) The Minister shall make the recommendations of the appointees available to the public.

Delivery of notice

      335. Delivery of any written notice or document for any purpose of this Act, if the mode is not otherwise specified, may be delivered by first class ordinary mail or first class registered mail,

         a)    in the case of a credit union, addressed to it or its chief executive officer at its principal place of business;

         b)    in the case of a director, addressed to the director at his or her address as shown on the records of the Ministry Corporation;

         c)    in the case of the Superintendent, addressed to the Superintendent at his or her office; or

         c.1)    in the case of the Corporation, addressed to the Corporation at its office; or

         d)    in the case of a member, addressed to the member at his or her the member's address as shown in the records of the credit union or by personal delivery to the member at his or her the member's place of employment.  1994, c. 11, s. 335; 1997, c. 28, s. 53.

Existing stabilization funds

      335.1 A stabilization fund established, before this section comes into force, under this Act or a predecessor of this Act shall be maintained as prescribed.

      336.-395.  Omitted amends or repeals other Acts. 1994, c. 11, ss. 336-395.

      396.  Omitted provides for coming into force of provisions of this Act.  1994, c. 11, s. 396.

     397.  Omitted enacts short title of this Act. 1994, c. 11, s. 397.

______________

Goto the top of this page.


Previous - XIV - Deposit Insurance Corporation of Ontario  |  Back to the table of contents