Information as to Mortgages and Charges
Marginal note:Delivery of prescribed particulars
68. (1) In respect of every mortgage or charge created by a company after the 1st day of October 1934, being either
(a) a mortgage or charge for the purpose of securing any issue of debentures,
(b) a mortgage or charge on uncalled share capital of the company,
(c) a floating charge on the undertaking or property of the company,
(d) a mortgage or charge on calls made but not paid, or
(e) a mortgage or charge on goodwill, on any patent or licence under a patent, on any trade mark or on any copyright or licence under a copyright,
the company shall deliver to the Minister the prescribed particulars of the mortgage or charge, and a copy of the instrument, if any, by which the mortgage or charge is created or evidenced, certified by the secretary of the company, or, in the Province of Quebec, a notarial copy of such instrument within thirty days after the date of its creation.
(2) Subsection (1) does not apply to the giving by a company of any warehouse receipt or bill of lading or any security under the provisions of the Bank Act as collateral security for the payment of any debt or liability of the company, nor to a floating charge created by a company on its accounts receivable or any of them after the 1st day of October 1934.
(3) In the case of a mortgage or charge created out of Canada comprising solely property situated outside Canada, it is sufficient if the prescribed particulars and the certified copy of the instrument by which the mortgage or charge is created or evidenced are delivered to the Minister within ninety days after the date on which the instrument or copy could in due course of post and if dispatched with due diligence have been received in Canada.
Marginal note:Property acquired subject to mortgage or charge
(4) Where after the 1st day of October 1934 a company acquires any property that is subject to a mortgage or charge of any such kind that, if it had been created by the company after the acquisition of the property, particulars thereof would have been required to be delivered to the Minister under subsection (1), the company shall deliver to the Minister the prescribed particulars of the mortgage or charge and a copy of the instrument, if any, by which the mortgage or charge is created or evidenced, certified by the secretary of the company, or, in the Province of Quebec, a notarial copy of such instrument, within ninety days after the date on which the acquisition is completed.
Marginal note:Register to be kept by Minister
(5) The Minister shall keep with respect to each company a register in the prescribed form in which shall be entered with respect to every mortgage or charge a copy of which has been delivered to the Minister the date of the mortgage or charge, the amount secured by it, short particulars of the property mortgaged or charged and the names of the mortgagees or persons entitled to the charge or the particulars required to be delivered to the Minister under subsection (6) as the case may be.
(6) Where a series of debentures containing or giving by reference to any other instrument any charge to the benefit of which the debenture holders of that series are entitledpari passu is created by a company, it is sufficient if there are delivered to the Minister within thirty days after the execution of the deed containing the charge or if there is no such deed after the execution of any debentures of the series, the following particulars:
(a) the total amount secured by the whole series;
(b) the date of the covering deed, if any, by which the security is created or defined or if there is no such deed the date of the issuance of the first debenture of the series;
(c) a general description of the property charged; and
(d) the names of the trustees, if any, for the debenture holders;
together with a copy of the covering deed, if any, certified by the secretary of the company under the corporate seal or in the Province of Quebec a notarial copy thereof, or if there is no such deed a copy of one of the debentures of the series certified by the secretary of the company under its corporate seal; and the Minister shall on payment of the prescribed fee enter those particulars in the register.
Marginal note:Rate of commission
(7) Where any commission, allowance, or discount has been paid or made either directly or indirectly by the company to any person in consideration of his subscribing or agreeing to subscribe, whether absolutely or conditionally, for any debentures of the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any such debentures, the particulars required to be delivered for registration under this section shall include particulars as to the amount or rate per cent of the commission, discount, or allowance so paid or made.
Marginal note:Debentures as security
(8) The deposit of any debentures as security for any debt of the company shall not, for the purposes of subsection (7), be treated as the issue of the debentures at a discount.
Marginal note:Failure to comply
(9) Failure to comply with this section does not affect the validity of the mortgage or charge or of the debentures issued, but every director or officer knowingly and wilfully authorizing or permitting such default and the company are liable on summary conviction to a fine not exceeding twenty dollars for every day during which the default continues.
Marginal note:Register to be open to inspection
(10) The register kept in pursuance of this section shall be open to inspection by any person on payment of the prescribed fee.
Marginal note:Copies of instruments to be kept at head office
(11) Every company shall cause a copy of every instrument creating any mortgage or charge particulars of which are required to be delivered to the Minister under this section to be kept at the head office of the company.
- R.S., 1952, c. 53, s. 66.
- Date modified: