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Bank Act (S.C. 1991, c. 46)

Full Document:  

Act current to 2019-08-15 and last amended on 2019-06-21. Previous Versions

PART VICorporate Governance (continued)

Financial Statements and Auditors (continued)

Remedial Actions (continued)

Marginal note:Status of approval

  •  (1) An application made or an action brought or intervened in under subsection 334(1) or section 338 need not be stayed or dismissed by reason only that it is shown that an alleged breach of a right or duty owed to the bank or its subsidiary has been or might be approved by the shareholders or members of the bank, or by the shareholders of the subsidiary, but evidence of approval by the shareholders or the members, as the case may be, may be taken into account by the court in making an order under section 335.

  • Marginal note:Court approval to discontinue

    (2) An application made or an action brought or intervened in under subsection 334(1) or section 338 shall not be stayed, discontinued, settled or dismissed for want of prosecution without the approval of the court given on such terms as the court thinks fit and, if the court determines that the interests of any complainant might be substantially affected by any stay, discontinuance, settlement or dismissal, the court may order any party to the application or action to give notice to the complainant.

  • 1991, c. 46, s. 336
  • 2010, c. 12, s. 2034

Marginal note:No security for costs

  •  (1) A complainant is not required to give security for costs in any application made or any action brought or intervened in under subsection 334(1) or section 338.

  • Marginal note:Interim costs

    (2) In an application made or an action brought or intervened in under subsection 334(1) or section 338, the court may at any time order the bank or its subsidiary to pay to the complainant interim costs, including legal fees and disbursements, but the complainant may be held accountable by the court for those interim costs on final disposition of the application or action.

  • 1991, c. 46, s. 337
  • 2005, c. 54, s. 76(F)

Marginal note:Application to rectify records

  •  (1) If the name of a person is alleged to be or to have been wrongly entered or retained in, or wrongly deleted or omitted from, the securities register, the members register or any other record of a bank, the bank, a security holder of the bank, a member of the bank or any aggrieved person may apply to a court for an order that the register or record be rectified.

  • Marginal note:Notice to Superintendent

    (2) An applicant under this section shall give the Superintendent notice of the application and the Superintendent may appear and be heard in person or by counsel at the hearing of the application.

  • Marginal note:Powers of court

    (3) In connection with an application under this section, the court may make any order it thinks fit including, without limiting the generality of the foregoing,

    • (a) an order requiring the register or other record of the bank to be rectified;

    • (b) an order restraining a bank from calling or holding a meeting of shareholders or members, or paying a dividend or patronage allocation, before the rectification;

    • (c) an order determining the right of a party to the proceedings to have the party’s name entered or retained in, or deleted or omitted from, the register or records of the bank, whether the issue arises between two or more security holders or alleged security holders, or two or more members or alleged members, or between the bank and any security holder or alleged security holder or member or alleged member; and

    • (d) an order compensating a party who has incurred a loss.

  • 1991, c. 46, s. 338
  • 2010, c. 12, s. 2035

Liquidation and Dissolution

Definition of court

 For the purposes of subsections 346(1) and 347(1) and (2), sections 348 to 352, subsection 353(1), sections 355 and 357 to 359, subsections 363(3) and (4) and section 368, court means a court having jurisdiction in the place where the bank has its head office.

Marginal note:Application of subsection (2) and sections 341 to 368

  •  (1) Subsection (2) and sections 341 to 368 do not apply to a bank that is insolvent within the meaning of the Winding-up and Restructuring Act.

  • Marginal note:Staying proceedings on insolvency

    (2) Any proceedings taken under this Part to dissolve or to liquidate and dissolve a bank shall be stayed if the bank is at any time found to be insolvent within the meaning of the Winding-up and Restructuring Act.

  • 1991, c. 46, s. 340
  • 1996, c. 6, s. 167

Marginal note:Returns to Superintendent

 A liquidator appointed under this Part to wind up the business of a bank shall provide the Superintendent with such information relating to the business and affairs of the bank in such form as the Superintendent requires.

Simple Liquidation

Marginal note:No property and no liabilities

  •  (1) A bank that has no property and no liabilities may apply to the Minister for letters patent dissolving the bank if it is authorized by

    • (a) in the case of a bank that is not a federal credit union, a special resolution of the shareholders or, if there are no shareholders, by a resolution of all the directors; or

    • (b) in the case of a federal credit union, a special resolution of the members and a separate special resolution of the shareholders, if any.

  • Marginal note:Dissolution by letters patent

    (2) Where the Minister has received an application under subsection (1) and is satisfied that all the circumstances so warrant, the Minister may issue letters patent dissolving the bank.

  • Marginal note:Effect of letters patent

    (3) A bank in respect of which letters patent are issued under subsection (2) ceases to exist on the day stated in the letters patent.

  • 1991, c. 46, s. 342
  • 2010, c. 12, s. 2036

Marginal note:Proposing liquidation

  •  (1) The voluntary liquidation and dissolution of a bank, other than a bank referred to in subsection 342(1),

    • (a) may be proposed by its directors;

    • (b) may, if the bank is not a federal credit union, be initiated by way of a proposal made by a shareholder who is entitled to vote at an annual meeting of shareholders in accordance with sections 143 and 144; or

    • (c) may, if the bank is a federal credit union, be initiated by way of a proposal made by a member in accordance with section 144.1.

  • Marginal note:Terms must be set out

    (2) A notice of any meeting at which the voluntary liquidation and dissolution of a bank is to be proposed must set out the terms of the proposal.

  • 1991, c. 46, s. 343
  • 2010, c. 12, s. 2037

Marginal note:Resolutions

 If the voluntary liquidation and dissolution of a bank is proposed, the bank may apply to the Minister for letters patent dissolving the bank

  • (a) if, in the case of a bank that is not a federal credit union, it is authorized by a special resolution of the shareholders or, if the bank has issued more than one class of shares, by special resolution of each class of shareholders whether or not those shareholders are otherwise entitled to vote; or

  • (b) if, in the case of a federal credit union, it is authorized by a special resolution of the members and, if the federal credit union has issued one or more classes of shares, by separate special resolution of each class of shareholders whether or not those shareholders are otherwise entitled to vote.

  • 1991, c. 46, s. 344
  • 2010, c. 12, s. 2038

Marginal note:Approval of Minister required

  •  (1) No action directed toward the voluntary liquidation and dissolution of a bank shall be taken by a bank, other than as provided in sections 343 and 344, until an application made by the bank pursuant to section 344 has been approved by the Minister.

  • Marginal note:Conditional approval

    (2) Where the Minister is satisfied on the basis of an application made pursuant to section 344 that the circumstances warrant the voluntary liquidation and dissolution of a bank, the Minister may, by order, approve the application.

  • Marginal note:Effect of approval

    (3) Where the Minister has approved an application made pursuant to section 344 with respect to a bank, the bank shall not carry on business except to the extent necessary to complete its voluntary liquidation.

  • Marginal note:Liquidation process

    (4) Where the Minister has approved an application made pursuant to section 344 with respect to a bank, the bank shall

    • (a) cause notice of the approval to be sent to each known claimant against and creditor of the bank;

    • (b) publish notice of the approval once a week for four consecutive weeks in the Canada Gazette and once a week for two consecutive weeks in one or more newspapers in general circulation in each province in which the bank transacted any business within the preceding twelve months;

    • (c) proceed to collect its property, dispose of property that is not to be distributed in kind to its shareholders or members, as the case may be, discharge all its obligations and do all other acts required to liquidate its business; and

    • (d) after giving the notice required under paragraphs (a) and (b) and adequately providing for the payment or discharge of all its obligations, distribute its remaining property, either in money or in kind, among its shareholders, according to their respective rights, or its members, as the case may be.

  • 1991, c. 46, s. 345
  • 2010, c. 12, s. 2039
 
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