Canada Cooperatives Act (S.C. 1998, c. 1)

Corporate Seal

Marginal note:Corporate seal

• 34 (1) A cooperative may but need not adopt a corporate seal and may change a corporate seal that is adopted.

• Marginal note:Validity of unsealed documents

  (2) A document executed or, in Quebec, signed on behalf of a cooperative is not invalid merely because a corporate seal is not affixed to it.

PART 5Membership

Conditions for Membership

Marginal note:By-laws govern

35 Subject to this Act and any provision in the articles, membership in a cooperative is governed by its by-laws.

Marginal note:Application for membership

• 36 (1) No person may be admitted to membership in a cooperative until

  • (a) the person has applied for membership in writing;

  • (b) the application has been approved by the directors; and

  • (c) the person has complied with the membership provisions required by the by-laws, including subscribing for any minimum number of membership shares, paying any minimum amount on account of the subscription price of the shares or paying any minimum amount on account of a member loan.

• Marginal note:Effective date of membership

  (2) If all the conditions set out in subsection (1) have been met within six months after the date on which the cooperative receives the application for membership, the directors may make the admission of the member into membership effective as of the date of the application or as of any date after that date but before the end of the six months.

Marginal note:Right to vote

• 37 (1) Subject to subsection (2) and subsection 7(3), a member has one vote on all matters to be decided by the members.

• Marginal note:Delegates

  (2) If the by-laws provide that the voting rights of a member are vested in one or more delegates to be elected or appointed by the members, the delegates so elected or appointed may exercise all or any of those rights.

• Marginal note:When delegation permitted by by-laws

  (3) When in this Act reference is made to a meeting of members and the cooperative has a by-law providing for the appointment of delegates, a reference in this Act to a meeting of members is to be construed as a reference to a meeting of delegates.

Marginal note:Members under eighteen years of age

• 38 (1) Subject to the by-laws, a person less than eighteen years of age may be admitted to membership in a cooperative and may vote at meetings of the cooperative.

• Marginal note:Minors

  (2) The articles and by-laws of a cooperative, and any unanimous agreement, are binding on a member who is less than eighteen years of age.

Withdrawal from Membership

Marginal note:Withdrawal of membership

• 39 (1) Unless the by-laws provide otherwise, this section applies to the voluntary withdrawal of a member from membership in a cooperative.

• Marginal note:Written notice

  (2) A member may withdraw from membership in a cooperative by written notice to the cooperative. Any such withdrawal is effective on the later of the date stated in the notice and the date on which the cooperative receives the notice.

• Marginal note:Redemption of membership shares and repayment of amounts owing on withdrawal

  (3) Subject to section 149, the cooperative must, no later than one year after the effective date of a notice of withdrawal, redeem all membership shares held by the withdrawing member at the redemption price determined in accordance with section 146 and repay to the member all member loans, all other amounts held to the member’s credit and all amounts outstanding on loans made to the cooperative by the member, together with any interest accrued on those amounts up to the date of the payment.

• Marginal note:Redemption and repayment more than one year after withdrawal

  (4) Despite subsection (3), if the directors determine that the redemption of membership shares, or the repayment of membership loans, of a withdrawing member would adversely affect the financial well-being of the cooperative, the directors may direct that the redemption and repayment referred to in subsection (3) take place after the end of the one year period.

• Marginal note:Withdrawal not to have certain effects

  (5) Unless the directors determine otherwise,

  • (a) the withdrawal of a member from the cooperative does not release the member from any debt or obligation to the cooperative or contract with the cooperative; and

  • (b) the cooperative need not, despite subsection (3), repay to the member amounts outstanding on loans made to the cooperative that have a fixed maturity date until that date has arrived.

Termination of Membership

Marginal note:Termination of membership by directors

• 40 (1) This section sets out the rights and procedures that apply to termination of membership. The by-laws of a cooperative may derogate from this section, but only in respect of the manner in which the membership of members may be terminated.

• Marginal note:Special resolution of directors

  (2) The directors may by special resolution order the termination of the membership of a member but, if the cooperative is in breach of section 149 — or if making the payment referred to in subsection (7) would put the cooperative in breach of section 149 — the termination is not effective until the cooperative is no longer in breach.

• Marginal note:Written notice

  (3) Not more than ten days after the date on which a special resolution is made, the secretary of the cooperative must give written notice to the member of the termination and the reasons for it. Subject to subsections (4) and (5), the effective date of the termination is the later of the date specified in the written notice and thirty days after the member receives the notice.

• Marginal note:Appeal

  (4) A member whose membership has been terminated may appeal from the decision of the directors to the next meeting of members by giving written notice to the secretary of the member’s intention to appeal no later than thirty days after receiving notice of the special resolution.

• Marginal note:Effect of notice of appeal

  (5) If a member gives a notice of appeal, the effect of the special resolution is suspended until the vote of the members under subsection (6).

• Marginal note:Resolution of members

  (6) If a member appeals the termination of membership, a vote of members must be taken at the next meeting of members as to whether the member’s membership should be terminated as of the effective date referred to in subsection (3). The vote is by majority of the members present at the meeting, unless a greater proportion is specified in the articles, the by-laws or a unanimous agreement.

• Marginal note:Effect of termination of membership

  (7) Subject to section 149, if a member’s membership is terminated, a cooperative must, no later than one year after the date of the special resolution, redeem all membership shares held by the member at the redemption price determined in accordance with section 146, and repay to the member all member loans and all other amounts held to the member’s credit and all amounts outstanding on loans made to the cooperative by the member, together with any interest accrued on those amounts up to the date of the payment.

• Marginal note:Termination of membership not to have certain effects

  (8) Unless the directors determine otherwise, the termination of the membership of a member does not release the member from any debt or obligation to the cooperative or contract with the cooperative.

• Marginal note:If address of member unknown

  (9) If the address of a member whose membership has been terminated by the directors is unknown to the cooperative after all reasonable efforts have been made to ascertain it and two years have elapsed since the effective date referred to in subsection (3), the cooperative must transfer all amounts owing under subsection (7) to a reserve fund, but those amounts do not, despite subsection (7), include any interest that would have accrued after the end of the two years.

• Marginal note:Amounts paid to entitled persons

  (10) If any amounts are transferred to a reserve fund under subsection (9), the cooperative must pay those amounts to any person who, no later than ten years after the transfer, shows evidence of entitlement satisfactory to the cooperative. If no person appears to show that evidence within the ten years, the amounts become the property of the cooperative.

Limitation

Marginal note:Limitation on by-law

41 No by-law governing the withdrawal of a member from membership or the termination of the membership of a member may authorize a redemption of membership shares or member loans in contravention of section 149.

Termination of Membership by Members

Marginal note:Termination by members

42 Unless the by-laws provide otherwise, the membership of a member may be terminated by a special resolution of the members. Section 40 applies, with any modifications that the circumstances require, to a termination by the members.

Other Terminations

Marginal note:Termination of inactive membership

• 43 (1) A cooperative may, by written notice to a member, terminate the membership if the member

  • (a) is a body corporate and winding-up proceedings have commenced with respect to it; or

  • (b) failed, during a period of two consecutive years, to transact any business with the cooperative.

• Marginal note:Provisions not to apply

  (2) Section 40, other than subsections 40(7) to (10), does not apply to a termination under this section.

Marginal note:Non-profit housing cooperatives

44 If the membership of a person in a non-profit housing cooperative is terminated, any right of the person to possession or occupancy of residential premises acquired by virtue of membership in the cooperative is subject to Part 20.

Marginal note:Re-admission

45 A person whose membership has been terminated under section 40 or 42 may be re-admitted to membership only by special resolution of the members.

Marginal note:Transfer

46 No transfer of a membership, a member loan or a membership share in a cooperative is valid for any purpose unless it is approved by the directors and the transferee has otherwise complied with the articles and by-laws of the cooperative and, if applicable, become a party to a unanimous agreement.

Marginal note:If membership too low

47 If the membership of a cooperative is reduced to a number less than the number of members required for incorporation, and if after thirty days notice remains at less than that number, the Director may require the cooperative

• (a) to apply for a certificate of continuance under the Canada Business Corporations Act, if it was incorporated with membership capital; or

• (b) to be liquidated or dissolved under Part 17.

PART 6Corporate Governance

Meetings

Marginal note:Place of members’ meetings

• 48 (1) Meetings of the members of a cooperative are to be held at the place in Canada provided for in the by-laws or, in the absence of such a provision, at any place in Canada that the directors may determine.

• Marginal note:Place of shareholders’ meetings

  (2) Meetings of the shareholders must be held at the place set out in the articles. If the articles do not set out such a place, the meetings are to be held at the place in Canada that the directors determine, unless all the shareholders entitled to vote at the meeting agree that the meeting is to be held at another place that is not in Canada.

• Marginal note:Participation in meeting by electronic means

  (3) Unless the by-laws provide otherwise, a member or shareholder may participate in a meeting of the cooperative, in accordance with the regulations, if any, by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting, if the cooperative makes available such a communication facility.

• Marginal note:Meeting held by electronic means

  (3.1) If the directors of a cooperative, or any other person, call a meeting of the cooperative pursuant to this Act, those directors or that person, as the case may be, may determine that the meeting shall be held, in accordance with the regulations, if any, entirely by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting, if the by-laws so provide.

• Marginal note:Presence

  (4) A person participating in a meeting referred to in subsection (3) is deemed to be present at the meeting.

Marginal note:Calling members’ meetings

• 49 (1) After holding the organizational meeting referred to in section 82, the directors must call a meeting of the members without delay.

• Marginal note:Business at first meeting

  (2) The members, at their first meeting, must

  • (a) adopt by-laws for the cooperative;

  • (b) elect directors in accordance with subsection 81(3); and

  • (c) subject to subsection 254(1), appoint an auditor to hold office until the close of the first annual meeting of members.