Interim Claims Procedure

  •  (1) A lessor may make an interim claim to the Minister for loss, calculated in accordance with subsection 44(7), sustained as a result of a lessee’s default on a capital lease, if the lessor has taken all of the measures described in subsection 43(3) that are applicable and either

    • (a) paragraph 43(3)(b) applies but the guarantee or suretyship has not been fully realized; or

    • (b) paragraph 43(3)(d) applies but the compromise settlement has not been fully implemented.

  • (2) The Minister shall pay the interim claim as if the lessor had fully realized the guarantee or suretyship at the time the interim claim was made or fully implemented the compromise settlement.

  • (3) Subsections 44(2) to (11) apply, with such modifications as the circumstances require, to an interim claim.

  • (4) If, after the interim claim is paid, the lessor, by realizing the guarantee or suretyship or fully implementing the compromise settlement, recovers 100% of the guarantee or suretyship or compromise settlement, the lessor shall so notify the Minister and the interim claim is deemed to be a final claim.

  • (5) If, after the interim claim is paid, the lessor, by realizing the guarantee or suretyship or fully implementing the compromise settlement, recovers less than 100% of the guarantee or suretyship or compromise settlement, the lessor may make a final claim under section 44 for the difference.

Subrogation

 If the Minister pays a lessor for loss sustained as a result of a lessee’s default on a capital lease, Her Majesty is subrogated, from the payment of the final claim, to the rights of the lessor, up to the amount paid by the Minister.

Audit or Examination

  •  (1) The Minister may, after giving at least 21 days notice in writing to a lessor, conduct an audit or examination of the lessor’s documents, records and books of account to verify that these Regulations are being complied with in respect of a capital lease, including that the lessor has acted in accordance with the due diligence requirements referred to in section 19 in respect of the approval and administration of the capital lease and that the documents submitted to the Minister in respect of the lessor are accurate and complete.

  • (2) The Minister is authorized to designate persons to carry out audits or examinations under these Regulations. A person designated by the Minister may, at any reasonable time, consult the lessor’s documents, records and books of account in respect of a capital lease.

  • (3) Every lessor shall, for the purpose of an audit or examination under these Regulations, give all reasonable assistance to any person designated by the Minister to carry out the audit or examination, provide access to all relevant sites, answer, orally or in writing, all questions relating to the subject-matter of the audit or examination and provide all information and documents in their possession and all copies required for the purpose of the audit or examination. The designated person shall not remove the documents or copies from the relevant sites without the permission of the lessor.

  • (4) The Minister shall provide the lessor with a copy of the report of the audit or examination within 21 days after the report is completed.

  • (5) If a lessor refuses or intentionally fails to comply with any requirement of this section, the Minister may notify the lessor in writing that the Minister is not liable under these Regulations to make any payment to the lessor for any loss sustained as a result of a lessee’s default on any capital lease entered into by the lessor.

  • SOR/2006-272, s. 9(E).

Evaluation of Regulations

 The Minister may request the lessor or the lessee to provide any information or documentation related to the capital lease for the purpose of evaluating these Regulations.

Cessation of Effect

 These Regulations shall cease to have effect on April 1, 2007.

Coming into Force

  •  (1) Subject to subsection (2), these Regulations come into force on April 1, 2002.

  • (2) The definition lessor in subsection 1(1), and sections 17 and 18 come into force on the day on which these Regulations are registered.

 
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