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Unclaimed moneys.

With interest.

Governor in Council may order pay

CHAPTER XXI.

PAYMENTS TO THE MINISTER UPON WINDING-UP.

115. If, in the event of the winding-up of the business of the bank in insolvency, or under any general winding-up Act, or otherwise, any moneys payable by the liquidator, either to shareholders or depositors, remain unclaimed,—

(a) for the period of three years from the date of suspension of payment by the bank; or,

(b) for a like period from the commencement of the windingup of such business; or,

(c) until the final winding-up of such business, if the business is finally wound up before the expiration of the said three years;

such moneys and all interest thereon shall, notwithstanding any statute of limitations or other Act relating to prescription, be paid to the Minister, to be held by him subject to all rightful claims on behalf of any person other than the bank.

2. If a claim to any moneys so paid is thereafter established to the satisfaction of the Treasury Board, the Governor in Counment to per- cil shall, on the report of the Treasury Board, direct payment son' entitled. thereof to be made to the person entitled thereto, together with interest on the principal sum thereof, at the rate of three per centum per annum, for a period not exceeding six years from the date of payment thereof to the Minister as aforesaid: ProIvided that no such interest shall be paid or payable on such principal sum, unless interest thereon was payable by the bank paying the same to the Minister.

Interest.

Bank discharged.

3. Upon payment to the Minister as herein provided, the bank and its assets shall be held to be discharged from further liability for the amounts so paid. 53 V., c. 31, s. 88.

See notes to sec. 114.

By sec. 126 the liability of the bank, under any law, custom Sec. 115. or agreement, to repay moneys deposited with it and interest, if any, and to pay dividends declared and payable on its capital stock, shall continue, notwithstanding any statute of limitations, or any enactment or law relating to prescription. Hence the necessity for this section.

The sections providing for the insolvency of a bank are sec. 125 et seq. As to the application to a bank of the provisions of the Dominion Winding-up Act, see Chapter XXIV., infra.

assets.

116. Upon the winding-up of a bank in insolvency or under Circulation outstanding any general winding-up Act, or otherwise, the assignees, liqui- at distribudators, directors, or other officials in charge of such winding-up, tion of shall, before the final distribution of the assets, or within three years from the commencement of the suspension of payment by the bank, whichever shall first happen, pay over to the Minister a sum, out of the assets of the bank, equal to the amount then outstanding of the notes intended for circulation issued by the bank.

relieved.

2. Upon such payment being made, the bank and its assets Bank shall be relieved from all further liability in respect of such outstanding notes.

redeem.

3. The sum so paid shall be held by the Minister and applied Minister to for the purpose of redeeming, whenever presented, such outstanding notes, without interest. 53 V., c. 31, s. 88.

This section is designed to guard against the charging of the Bank Circulation Redemption Fund with the payment of the notes of an insolvent bank which are presented after the liquidator has distributed the assets. This safeguard is necessary because by sec. 64 the principle is laid down that every bank note, once in circulation, shall be redeemable, no matter how long it may be outstanding. An incidental result of the section is that an insolvent bank is deprived of the profit, if any, derived from the loss or destruction of outstanding bank notes. As to the payment of interest on the notes of a bank which has suspended payment and when such notes cease to bear interest, see sec. 65.

notes of insolvent

bank

Sec. 116. Cf. sec. 158 of the Winding-up Act which provides that the Outstanding liquidators shall ascertain as nearly as possible the amount of notes of the bank intended for circulation and actually outstanding, and shall reserve dividends on any part of the said amount in respect of which claims are not filed, until the expiration of at least two years after the date of the winding-up order, or until the last dividend, if such last dividend is not made until after the experation of the said time. And further (by sub-sec. 2) that if claims are not filed and dividends applied for in respect of any part of the said amount before the period by this section limited, the dividends so reserved shall form the last or part of the last dividend.

CHAPTER XXII.

THE CURATOR.

Owing to the establishment in 1890 of the Bank Circulation Redemption Fund (secs. 64 et seq.) every chartered bank now has an interest in seeing that the affairs of a bank which has suspended payment shall be properly managed and that proper measures are taken for the redemption of the outstanding notes of such bank. The Canadian Bankers' Association, formerly existing as an unincorporated society, was incorporated in 1900 (see Chapter XXVII.), as a suitable medium for the necessary supervision. Power is given to the Association by the next following sections of the Act to appoint a curator in the event of the suspension of payment by a bank. The powers and duties of the curator are governed by these sections and also by "bylaws, rules and regulations" made by the Association in pursuance of the further authority conferred upon it by sec. 124 (see end of this chapter where the by-laws passed by the Association on this subject are set out).

-117. The Association, shall, if a bank suspends payment in Association to appoint. specie or Dominion notes of any of its liabilities as they accrue, forthwith appoint a curator to supervise the affairs of such bank.

2. The Association may at any time remove the curator, and Removal. may appoint another person to act in his stead. 63-64 V., c. 26,

s. 24.

The "Association" is defined by sec. 2 to mean the Canadian Bankers' Association.

ment to be

118. The appointment of the curator shall be made in the Appointmanner provided for in the by-law of the Association made in under by-law that behalf as hereinafter provided.

of Associa

tion.

Sec. 118.

If no bylaw.

Powers and duties of curator.

Idem.

Idem.

Officers and clerks to assist curator.

No act of directors

2. If there is no such by-law the appointment shall be made in writing by the president of the Association, or by the person acting as president. 63-64 V., c. 26, s. 25.

The by-law referred to is made in pursuance of sec. 124, and is set out below.

119. The curator shall assume supervision of the affairs of the bank, and of all necessary arrangements for the payment of the notes of the bank issued for circulation, and, at the time of his appointment, outstanding and in circulation.

2. The curator shall generally have all powers and shall take all steps and do all things necessary or expedient to protect the rights and interests of the creditors and shareholders of the bank, and to conserve and ensure the proper disposition, according to law, of the assets of the bank; and, for the purposes of this section, he shall have free and full access to all books, accounts, documents and papers of the bank.

3. The curator shall continue to supervise the affairs of the bank until he is removed from office, or until the bank resumes business, or until a liquidator is duly appointed to wind up the business of the bank. 63-64 V., c. 26, s. 26.

A bank which has suspended payment is forbidden by sec. 61 to issue or re-issue its notes payable to bearer on demand and intended for circulation until it resumes business with the consent in writing of the curator or, having resumed business without such consent, until it is authorized by the Treasury Board to issue or re-issue such notes.

120. The president, vice-president, directors, general manager, managers, clerks and officers of the bank shall give and afford to the curator all such information and assistance as he requires in the discharge of his duties. 63-64 V., c. 26, s. 27.

121. No by-law, regulation, resolution or act, touching the valid unless affairs or management of the bank, passed, made or done by the approved by directors during the time the curator is in charge of the bank,

curator.

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