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Canada Not-for-profit Corporations Act (S.C. 2009, c. 23)

Act current to 2019-11-19 and last amended on 2018-05-01. Previous Versions

PART 7Trust Indentures (continued)

Marginal note:Contents of declaration, etc.

 Evidence of compliance as required by section 108 shall consist of a statutory declaration or certificate made by a director or an officer of the issuer, the guarantor or, in Quebec, the surety stating that the conditions referred to in that section have been complied with. If compliance with any of those conditions is subject to review by legal counsel, evidence of compliance also includes an opinion of legal counsel that those conditions have been complied with. If compliance with any of those conditions is subject to review by an auditor or accountant, evidence of compliance also includes an opinion or report of the public accountant of the issuer, guarantor or surety, or any other accountant that the trustee selects, that those conditions have been complied with.

Marginal note:Further evidence of compliance

 The evidence of compliance referred to in section 109 shall include a statement by the person giving the evidence

  • (a) declaring that they have read and understand the conditions of the trust indenture referred to in section 108;

  • (b) describing the nature and scope of the examination or investigation on which the statutory declaration, certificate, opinion or report is based; and

  • (c) declaring that they have made the examination or investigation that they believe necessary to enable them to make their statutory declaration, certificate, opinion or report.

Marginal note:Trustee may require evidence of compliance

  •  (1) On the demand of a trustee, the issuer, the guarantor or, in Quebec, the surety of debt obligations issued under a trust indenture shall provide the trustee with evidence in any form that the trustee may require for compliance with any condition relating to any action required or permitted to be taken by the issuer, guarantor or surety under the trust indenture.

  • Marginal note:Certificate of compliance

    (2) At least once in each prescribed period beginning on the date of the trust indenture and at any other time on the demand of a trustee, the issuer, the guarantor or, in Quebec, the surety of debt obligations issued under a trust indenture shall provide the trustee with

    • (a) a certificate that the issuer, the guarantor or, in Quebec, the surety has complied with all requirements contained in the trust indenture that, if not complied with, would, with the giving of notice, lapse of time or otherwise, constitute an event of default; or

    • (b) a certificate of the particulars of any failure to comply with the requirements.

Marginal note:Notice of default

 The trustee shall give notice to the holders of debt obligations issued under a trust indenture of every event of default arising under the trust indenture and continuing at the time the notice is given, unless the trustee reasonably believes that it is in the best interests of the holders of the debt obligations to withhold the notice and so informs in writing the issuer, the guarantor or, in Quebec, the surety. The notice shall be given within the prescribed period.

Marginal note:Duties of trustee

 A trustee in exercising their powers and discharging their duties shall

  • (a) act honestly and in good faith with a view to the best interests of the holders of the debt obligations issued under the trust indenture; and

  • (b) exercise the care, diligence and skill of a reasonably prudent trustee.

Marginal note:Reliance on statements

 Despite section 113, a trustee is not liable if they rely in good faith on statements contained in a statutory declaration, certificate, opinion or report that complies with this Act or the trust indenture.

Marginal note:No exculpation

 No term of a trust indenture or of any agreement between a trustee and the holders of debt obligations issued under the trust indenture or between the trustee and the issuer, the guarantor or, in Quebec, the surety shall operate so as to relieve a trustee from the duties imposed on the trustee by section 113.

PART 8Receivers, Receiver-managers and Sequestrators

Marginal note:Functions of receiver or sequestrator

 A receiver or sequestrator of any property of a corporation may, subject to the rights of secured creditors, receive the income from the property, pay the liabilities connected with the property and realize the security interest of those on behalf of whom the receiver or sequestrator is appointed, but, except to the extent permitted by a court, the receiver or sequestrator may not carry on the activities of the corporation.

Marginal note:Functions of receiver-manager

 A receiver-manager of the corporation may carry on any activities of the corporation to protect the security interest of those on behalf of whom the receiver-manager is appointed.

Marginal note:Directors’ powers cease

 If a receiver-manager or sequestrator is appointed by a court or under an instrument or act, the powers of the directors of the corporation that a receiver-manager or sequestrator is authorized to exercise may not be exercised by the directors until the receiver-manager or sequestrator is discharged.

Marginal note:Duty to act

 A receiver, receiver-manager or sequestrator appointed by a court shall act in accordance with the orders of the court.

Marginal note:Duty under instrument or act

 A receiver, receiver-manager or sequestrator appointed under an instrument or act shall act in accordance with that instrument or act and any order of a court made under section 122.

Marginal note:Duty of care

 A receiver, receiver-manager or sequestrator of a corporation appointed under an instrument or act shall

  • (a) act honestly and in good faith; and

  • (b) deal with any property of the corporation in their possession or control in a commercially reasonable manner.

Marginal note:Orders given by court

 On the application of a receiver, receiver-manager or sequestrator, whether appointed by a court or under an instrument or act, or of any interested person, a court may make

  • (a) an order appointing, replacing or discharging a receiver, receiver-manager or sequestrator and approving their accounts;

  • (b) an order determining the notice to be given to any interested person or dispensing with notice to any person;

  • (c) an order fixing the remuneration of the receiver, receiver-manager or sequestrator;

  • (d) an order requiring the receiver, receiver-manager or sequestrator, or a person by or on behalf of whom the receiver, receiver-manager or sequestrator is appointed, to make good any default in connection with the receiver’s, receiver-manager’s or sequestrator’s custody or management of the property and activities of the corporation, or relieving the receiver, receiver-manager or sequestrator, or a person by or on behalf of whom the receiver, receiver-manager or sequestrator was appointed, from any default on any terms that the court thinks fit;

  • (e) an order confirming any act of the receiver, receiver-manager or sequestrator;

  • (f) an order giving directions on any matter relating to the duties of the receiver, receiver-manager or sequestrator; and

  • (g) any other order that it thinks fit.

Marginal note:Duties of receiver and receiver-manager

 A receiver or receiver-manager shall

  • (a) immediately notify the Director of their appointment and discharge;

  • (b) take into their custody and control the property of the corporation in accordance with the court order, instrument or act under which they are appointed;

  • (c) open and maintain a bank account in their name as receiver or receiver-manager of the corporation for the money of the corporation coming under their control;

  • (d) keep detailed accounts of all transactions carried out as receiver or receiver-manager;

  • (e) keep accounts of their administration that shall be available during usual business hours for inspection by the directors of the corporation;

  • (f) prepare at least once in every prescribed period after the date of their appointment financial statements of their administration as far as is practicable in the form required by section 172; and

  • (g) on completion of their duties, render a final account of their administration in the form adopted for interim accounts under paragraph (f).

PART 9Directors and Officers

Marginal note:Duty to manage or supervise management

 Subject to this Act, the articles and any unanimous member agreement, the directors shall manage or supervise the management of the activities and affairs of a corporation.

Marginal note:Number of directors

 A corporation shall have one or more directors, but a soliciting corporation shall not have fewer than three directors, at least two of whom are not officers or employees of the corporation or its affiliates.

Marginal note:Qualifications of directors

  •  (1) The following persons are disqualified from being a director of a corporation:

    • (a) anyone who is less than 18 years of age;

    • (b) anyone who is incapable;

    • (c) a person who is not an individual; and

    • (d) a person who has the status of a bankrupt.

  • Marginal note:Membership

    (2) Unless the by-laws otherwise provide, a director of a corporation is not required to be a member of the corporation.

  • Marginal note:No alternate directors

    (3) No person shall act for an absent director at a meeting of directors.

  • 2009, c. 23, s. 126
  • 2018, c. 8, s. 100
 
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