Government of Canada / Gouvernement du Canada
Symbol of the Government of Canada

Search

Trust and Loan Companies Act (S.C. 1991, c. 45)

Act current to 2022-09-22 and last amended on 2022-06-23. Previous Versions

PART VCapital Structure (continued)

Security Certificates and Transfers (continued)

Marginal note:Right to reclaim possession

  •  (1) A person against whom the transfer of a security is wrongful for any reason, including the person’s incapacity, may, against anyone except a bona fide purchaser,

    • (a) reclaim possession of the security or obtain possession of any new security evidencing all or part of the same rights; or

    • (b) claim damages.

  • Marginal note:Recovery where unauthorized endorsement

    (2) If the transfer of a security is wrongful by reason of an unauthorized endorsement, the owner may reclaim possession of the security or a new security even from a bona fide purchaser if the ineffectiveness of the purported endorsement is asserted against the purchaser under section 120.

  • Marginal note:Remedies

    (3) The right to reclaim possession of a security may be specially enforced, its transfer may be restrained and the security may be impounded pending litigation.

Marginal note:Right to requisites for registration

  •  (1) Unless otherwise agreed, a transferor shall, on demand, supply a purchaser with proof of the transferor’s authority to transfer a security or with any other requisite that is necessary to obtain registration of the transfer of a security, but if the transfer is not for value, it is not necessary for a transferor to prove authority to transfer unless the purchaser pays the reasonable and necessary costs of the proof and transfer.

  • Marginal note:Rescission of transfer

    (2) If a transferor fails to comply with a demand under subsection (1) within a reasonable time, the purchaser may reject or rescind the transfer.

Marginal note:Seizure of security

 No seizure of a security or other interest evidenced thereby is effective until the person making the seizure obtains possession of the security.

Marginal note:No conversion if good faith delivery

 An agent or bailee who in good faith, including observance of reasonable commercial standards if the agent or bailee is in the business of buying, selling or otherwise dealing with securities of a company, has received securities and sold, pledged or delivered them according to the instructions of the agent’s or bailee’s principal is not liable for conversion or for participation in breach of fiduciary duty even though the principal has no right to dispose of the securities.

Marginal note:Duty to register transfer

  •  (1) Subject to Part VII, where a security in registered form is presented for transfer, the issuer shall register the transfer if

    • (a) the security is endorsed by an appropriate person;

    • (b) reasonable assurance is given that the endorsement is genuine and effective;

    • (c) the issuer has no duty to inquire into adverse claims or has discharged any such duty;

    • (d) all applicable laws relating to the collection of taxes have been complied with;

    • (e) the transfer is rightful or is to a bona fide purchaser; and

    • (f) the fee, if any, referred to in subsection 88(2) has been paid.

  • Marginal note:Liability for delay

    (2) Where an issuer has a duty to register a transfer of a security, the issuer is liable to the person presenting it for registration for any loss resulting from any unreasonable delay in registration or from the failure or refusal to register the transfer.

Marginal note:Assurance of endorsements

  •  (1) An issuer may require an assurance that each necessary endorsement on a security is genuine and effective by requiring a guarantee of the signature of the person endorsing the security and by requiring

    • (a) if the endorsement is by an agent, reasonable assurance of authority to sign;

    • (b) if the endorsement is by a fiduciary, evidence of appointment or incumbency;

    • (c) if there is more than one fiduciary, reasonable assurance that all who are required to sign have done so; and

    • (d) in any other case, assurance that corresponds as closely as practicable to the foregoing.

  • Definition of guarantee of the signature

    (2) For the purposes of subsection (1), guarantee of the signature means a guarantee signed by or on behalf of a person whom the issuer believes, on reasonable grounds, to be a responsible person.

  • Marginal note:Standards

    (3) An issuer may adopt reasonable standards to determine responsible persons for the purposes of subsection (2).

  • Definition of evidence of appointment or incumbency

    (4) For the purposes of paragraph (1)(b), evidence of appointment or incumbency means

    • (a) in the case of a fiduciary appointed by a court and referred to in subsection 99(1), a copy of the certified court order referred to in subsection 99(1) and dated not earlier than sixty days before the day a security is presented for transfer; or

    • (b) in the case of any other fiduciary, a copy of a document showing the appointment or other evidence believed by the issuer to be appropriate.

  • Marginal note:Standards

    (5) An issuer may adopt reasonable standards with respect to evidence referred to in paragraph (4)(b).

  • Marginal note:No notice to issuer

    (6) An issuer is deemed not to have notice of the contents of any document referred to in subsection (4) that is obtained by the issuer except to the extent that the contents relate directly to appointment or incumbency.

Marginal note:Notice from additional documentation

 If an issuer, in relation to a transfer, demands assurance other than an assurance specified in subsection 130(1) and obtains a copy of a will, trust or partnership agreement or a by-law or similar document, the issuer is deemed to have notice of all matters contained therein affecting the transfer.

Marginal note:Limited duty of inquiry

  •  (1) An issuer to whom a security is presented for registration has a duty to inquire into adverse claims if

    • (a) the issuer receives written notice of an adverse claim at a time and in a manner that provides the issuer with a reasonable opportunity to act on it before the issue of a new, reissued or re-registered security and the notice discloses the name and address of the claimant, the registered owner and the issue of which the security is a part; or

    • (b) the issuer is deemed to have notice of an adverse claim from a document that it obtained under section 131.

  • Marginal note:Discharge of duty

    (2) An issuer may discharge a duty of inquiry by any reasonable means, including notifying an adverse claimant by registered mail sent to the address provided by the adverse claimant or, if no such address has been provided, to the adverse claimant’s residence or regular place of business, that a security has been presented for registration of transfer by a named person and that the transfer will be registered unless, within thirty days after the date of mailing of the notice, either

    • (a) the issuer is served with a restraining order or other order of a court, or

    • (b) the issuer is provided with an indemnity bond sufficient in the issuer’s judgment to protect the issuer and any registrar, transfer agent or other agent of the issuer from any loss that may be incurred by any of them as a result of complying with the adverse claim.

Marginal note:Inquiry into adverse claims

 Unless an issuer is deemed to have notice of an adverse claim from a document that it obtained under section 131 or has received notice of an adverse claim under subsection 132(1), if a security presented for registration is endorsed by the appropriate person, the issuer has no duty to inquire into adverse claims and, in particular,

  • (a) an issuer registering a security in the name of a person who is a fiduciary or who is described as a fiduciary is not bound to inquire into the existence, extent or correct description of the fiduciary relationship and thereafter the issuer may assume without inquiry that the newly registered owner continues to be the fiduciary until the issuer receives written notice that the fiduciary is no longer acting as such with respect to the particular security;

  • (b) an issuer registering a transfer on an endorsement by a fiduciary has no duty to inquire into whether the transfer is made in compliance with the document or with the law of the jurisdiction governing the fiduciary relationship; and

  • (c) an issuer is deemed not to have notice of the contents of any court record or any registered document even if the record or document is in the issuer’s possession and even if the transfer is made on the endorsement of a fiduciary to the fiduciary specifically or to the fiduciary’s nominee.

Marginal note:Duration of notice of adverse claim

 A written notice of adverse claim received by an issuer is effective for twelve months after the day it was received unless the notice is renewed in writing.

Marginal note:Limitation on issuer’s liability

  •  (1) Except as otherwise provided in any applicable law relating to the collection of taxes, an issuer is not liable to the owner or any other person who incurs a loss as a result of the registration of a transfer of a security if

    • (a) the necessary endorsements were on or with the security; and

    • (b) the issuer had no duty to inquire into adverse claims or had discharged any such duty.

  • Marginal note:Duty of issuer on default

    (2) If an issuer has registered a transfer of a security to a person not entitled to it, the issuer shall on demand deliver a like security to the owner unless

    • (a) the issuer is not liable by virtue of subsection (1);

    • (b) the owner is precluded by subsection 136(1) from asserting any claim; or

    • (c) the delivery would result in over-issue in respect of which section 100 applies.

Marginal note:Lost or stolen security

  •  (1) Where a security has been lost, apparently destroyed or wrongfully taken, and the owner fails to notify the issuer of that fact by giving the issuer written notice of the owner’s adverse claim within a reasonable time after the owner knows of the loss, destruction or taking, then, if the issuer has registered a transfer of the security before receiving the notice, the owner is precluded from asserting against the issuer any claim to a new security.

  • Marginal note:Duty to issue new security

    (2) Where the owner of a security claims that the security has been lost, destroyed or wrongfully taken, the issuer shall issue a new security in place of the original security if the owner

    • (a) so requests before the issuer has notice that the security has been acquired by a bona fide purchaser;

    • (b) provides the issuer with a sufficient indemnity bond; and

    • (c) satisfies any other reasonable requirements imposed by the issuer.

  • Marginal note:Duty to register transfer

    (3) If, after the issue of a new security under subsection (2), a bona fide purchaser of the original security presents the original security for registration of transfer, the issuer shall register the transfer unless registration would result in over-issue in respect of which section 100 applies.

  • Marginal note:Right of issuer to recover

    (4) In addition to the rights that an issuer has by reason of an indemnity bond, the issuer may recover the new security issued under subsection (2) from the person to whom it was issued or any person taking under that person other than a bona fide purchaser.

Marginal note:Authenticating agent’s duty

 An authenticating trustee, registrar, transfer agent or other agent of an issuer has, in respect of the issue, registration of transfer and cancellation of a security of the issuer,

  • (a) a duty to the issuer to exercise good faith and reasonable diligence; and

  • (b) the same obligations to the holder or owner of a security and the same rights, privileges and immunities as the issuer.

Marginal note:Notice to agent

 Notice to an authenticating trustee, registrar, transfer agent or other agent of an issuer is notice to the issuer in respect of the functions performed by the agent.

PART VICorporate Governance

Shareholders

Marginal note:Place of meetings

  •  (1) Meetings of shareholders of a company shall be held at the place within Canada provided for in the by-laws of the company or, in the absence of any such provision, at the place within Canada that the directors determine.

  • Marginal note:Participation by electronic means

    (2) Unless the by-laws provide otherwise, any person who is entitled to attend a meeting of shareholders may participate in the meeting 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 company makes one available. A person who is participating in a meeting by one of those means is deemed for the purposes of this Act to be present at the meeting.

  • Marginal note:Regulations

    (3) The Governor in Council may make regulations respecting the manner of and conditions for participating in a meeting by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting.

  • 1991, c. 45, s. 139
  • 2005, c. 54, s. 381

Marginal note:Calling meetings

  •  (1) The directors of a company

    • (a) shall, after the meeting called pursuant to subsection 50(1), call the first annual meeting of shareholders of the company, which meeting must be held not later than six months after the end of the first financial year of the company, and subsequently call an annual meeting of shareholders, which meeting must be held not later than six months after the end of each financial year; and

    • (b) may at any time call a special meeting of shareholders.

  • Marginal note:Order to delay calling annual meeting

    (2) Despite subsection (1), the company may apply to the court for an order extending the time for calling an annual meeting.

  • Marginal note:Obligation to notify Superintendent

    (3) The company shall give notice of the application to the Superintendent before any hearing concerning the application and shall provide the Superintendent with a copy of any order that is issued.

  • Marginal note:Superintendent’s right to appear

    (4) The Superintendent is entitled to appear and be heard in person or by counsel at any hearing concerning the application.

  • Marginal note:Authority to fix record date

    (5) The directors may in advance fix a record date, that is within the prescribed period, for the determination of shareholders for any purpose, including for a determination of which shareholders are entitled to

    • (a) receive payment of a dividend;

    • (b) participate in a liquidation distribution;

    • (c) receive notice of a meeting of shareholders; or

    • (d) vote at a meeting of shareholders.

  • Marginal note:Determination of record date

    (6) If no record date is fixed,

    • (a) the record date for the determination of shareholders who are entitled to receive notice of a meeting of shareholders is

      • (i) at the close of business on the day immediately preceding the day on which the notice is given, or

      • (ii) if no notice is given, the day on which the meeting is held; and

    • (b) the record date for the determination of shareholders for any other purpose, other than to establish a shareholder’s right to vote, is at the close of business on the day on which the directors pass a resolution in respect of that purpose.

  • Marginal note:Notice of record date

    (7) If a record date is fixed and unless notice of the record date is waived in writing by every holder of a share of the class or series affected whose name is set out in the securities register at the close of business on the day on which the directors fix the record date, notice of the record date shall be given within the prescribed period by

    • (a) advertisement in a newspaper in general circulation in the place where the company’s head office is situated and in each place in Canada where the company has a transfer agent or where a transfer of its shares may be recorded; and

    • (b) written notice to each stock exchange in Canada on which the company’s shares are listed for trading.

  • 1991, c. 45, s. 140
  • 2005, c. 54, s. 382
 
Date modified: