PART 12Security Certificates, Registers and Transfers (continued)
Marginal note:Agent or mandatary
187 A cooperative may appoint an agent or mandatary to maintain securities registers on its behalf.
- 1998, c. 1, s. 187
- 2011, c. 21, s. 91(E)
188 The registration of the issue or transfer of an investment share in a securities register maintained by the cooperative is complete and valid registration for all purposes.
189 Subject to sections 51, 53 and 61, a cooperative or a trustee as defined in section 266 may treat the person whose name appears on the securities register as the owner of a security as its owner for all purposes.
Marginal note:Proof of ownership
190 If a cooperative restricts the right to transfer its investment shares, the cooperative may, despite section 189, treat a person as the registered holder of a security if the person provides the cooperative with evidence that reasonably meets the requirements of the cooperative that the person is
(a) the heir of a deceased security holder, or the fiduciary of the estate or succession of a deceased security holder, or of a registered security holder who is a minor, an incapable person or a missing person; or
(b) a liquidator of, or a trustee in bankruptcy for, a registered security holder.
- 1998, c. 1, s. 190
- 2018, c. 8, s. 66
Marginal note:Proof of ownership
191 A cooperative must treat a person, other than one described in section 190, as being entitled to exercise the rights and privileges attached to a security if the person provides proof that the person has acquired ownership of the security by operation of law or has legal authority to exercise the rights and privileges.
Marginal note:Joint owners
192 If satisfactory proof of the death of a joint holder of a security is provided to a cooperative, it may treat any surviving joint holders as the owner of the security.
Marginal note:Duties of cooperative
193 A cooperative is not required to inquire into the existence of, or see to the performance of, any duty owed to a third person by a registered holder or a person who may be treated as a registered holder of a security.
194 If an individual who is less than 18 years of age exercises a right of ownership in a security of a cooperative, no subsequent repudiation or avoidance or, in Quebec, annulment or reduction of obligations is effective against the cooperative.
- 1998, c. 1, s. 194
- 2011, c. 21, s. 92
Marginal note:Deceased owner
195 (1) Subject to any applicable law relating to the collection of taxes, a person who is an heir or a fiduciary of an estate or succession of a deceased security holder is entitled to become the registered holder or to designate a registered holder if the person deposits the following information with the cooperative or its transfer agent, together with any reasonable assurances that the cooperative may require:
(a) the security certificate or, in default of one, a document proving that the deceased was the security holder;
(b) a document proving the death of the security holder; and
(c) a document proving that the heir or fiduciary has the right under the law of the place in which the deceased was domiciled immediately before their death to deal with the security.
(2) A security certificate referred to in paragraph (1)(a) must be endorsed
Marginal note:Right of cooperative
(3) Deposit of the documents required by subsection (1) empowers a cooperative or its transfer agent to record in a securities register the transmission of a security from the deceased holder to the heir or fiduciary or to any person that the heir or fiduciary may designate and to treat the person who becomes a registered holder as the owner of the securities.
196 (1) Subject to this section, the provisions of this Part that validate a security or compel its issue or reissue do not apply if the validation, issue or reissue of a security would result in overissue.
Marginal note:Identical security
(2) The person who is entitled to a validation or issue may, if there has been an overissue and if a valid security that is similar in all respects to the security involved in the overissue is reasonably available for purchase, compel the issuer to purchase and deliver that security against the surrender of the security that the person holds.
Marginal note:If identical security not available
(3) If a valid security that is similar in all respects to the security involved in the overissue is not reasonably available for purchase, the person who is entitled to the validation or issue may recover from the issuer an amount equal to the price the last purchaser for value paid for the invalid security.
Marginal note:Increase in capital
(4) The overissued securities are valid from the date they were issued only if the issuer increases the number of its authorized securities to a number equal to or greater than the number of securities previously authorized plus the number of the securities overissued.
197 Sections 147 to 149 and 152 do not apply to a payment or purchase by an issuer under section 196.
Marginal note:Rules of action
198 The following rules apply in an action on a security:
(a) each signature on the security certificate or in a necessary endorsement is admitted unless specifically denied in the pleadings;
(b) a signature on the security is presumed to be genuine and authorized but, if the effectiveness of the signature is in issue, the burden of establishing that it is genuine and authorized is on the party claiming under the signature;
(c) if a signature is admitted or established, production of a certificate entitles the holder to recover on it unless the other party establishes a defence or defect going to the validity of the security; and
(d) if the other party establishes the defence or defect, the plaintiff has the burden of establishing that the defect is ineffective against the plaintiff or some other person under whom the claim is made.
Marginal note:Delivery of securities
(2) Subsection (1) is subject to any agreement to the contrary, to the provisions of this Act, of any other applicable Act of Parliament, of any applicable Act of the legislature of a province or of any applicable regulation made under any such Act or to any applicable stock exchange rule.
- 1998, c. 1, s. 199
- 2018, c. 8, s. 67
Marginal note:Incorporation by reference
200 (1) The terms of a security include those stated on the security and those incorporated by reference to another instrument or act, Act of Parliament or the legislature of a province, regulation, rule or order to the extent that the incorporated terms do not conflict with those stated on the security.
Marginal note:Purchaser without notice
(2) Subsection (1) applies to a good faith purchaser but the incorporation by reference is itself not notice of a defect to the purchaser even if the security expressly states that a person accepting it admits that notice.
- 1998, c. 1, s. 200
- 2011, c. 21, s. 93(E)
Marginal note:Validity of security
201 A security is valid in the hands of a good faith purchaser.
202 Subject to section 205, the fact that a security is not genuine is a complete defence even against a good faith purchaser.
203 All other defences of an issuer, including non-delivery and conditional delivery of a security, are ineffective against a good faith purchaser.
Marginal note:Deemed notice
Marginal note:Stale security
(2) A security becomes stale if
(a) the purchaser takes the security more than two years after
(b) the payment of money or the delivery of securities is required in order to present or surrender the security, the money or securities are available on the day for the payment or delivery and the purchaser takes the security more than one year after that day.
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