Co-operative Societies Act (Act No. 28 of 1999)

3. Co-operative prmdvk:s

4. Cru,formily to cn-operat ive prineiple.s PAP.TU

5. Registrar of cn-opt--.rative srxietie:; &. Ceifuicru.e ofRegistr.JT

7. Power to rduse dq:::uments

8. Verificati n of d{x-.umenl s

9. ApphcatioA forn:gistration HJ. Content ofhy-fa.ws n. EUet:\.l'Jfb)l-faws i 2. Conditions for registration i 3. Registration of societies

14. Etfoct of certificate on reg isu:aiiOJl 15. f'ruha1iouary :il:1cie1ies 16, Citpad.ty lllld Pf\1-Vers i 7. Rr..-gisteitd office.

18. Mainlenaȣ:e of mandatory records

19. Acct$s to records

20. Suspension and cancd!ation of regislri\tion

21. Secl n. PrerW,gfatr;1t.im-, 1:00\J;!.,;:ls PARTiq Mm.w~1!P AND M;,x,;rn,Gs 2 3. Appiicatimt and qualification for membership

24. Joint accoimts

25. Membership fees and membership :re11ister 26, Liability of past aml present members

27. Withdn1.wru of membership

28. Tenninatlonofmetnbetshi:p by B<l!Ud

19. Tennwatim, ofmembe{shlp by members

30. Suspension of membe1llbip

31. Appeal 19% No. 28 l Co-operative Societies Act { 1999. l2. Re-admittance

33. Voungrights

34. Rep~entatives of~ber wl10 is Mt a-n individual

35. Voting_vrooedore 36. l'llllt.-e of meetings

37. J\f.emben; not to exercise rights until due paymen\

38. Fm\ Stmeral meet.mg.

39. Annual general meetmgs

40. Sptciiai meeting;! 4 L .Meeting called by Registrar · 42.. Rcsl'>ltation in lieu Gfm~ing

43. Noticco(meetings 44. fixinB reoord date

45. QuoruIU

46. Del:t:ptes

41. Proposals

48. Pow-er\omak.eby-law~

49. Eff-ecti11cdav:ofla.w PARTlV MANAO'liMllNT

50. Board-of dirt:ctors Sl. Officers

52. Provi~onal directon 'M.\d el~ted <lil"ed~ts 53. {lowers of Boud

54. Committees:,genctall:,i 55. ienw:eof.committees generally S6. Credi\ committee

51. Dutumofcredit c:runmittee

58. Approval ofloans

59. Credit committee reports

60. 'Removal ofmemberofcred-1t cornmitte.e. 6\. Remol{e.(ofmemberofc:.redi(~»mniiaeeby Board

62. Superyisozy committee (:i3. l)uties ofSupetVisory committee

64. Removal ofmember of snpervisocy ~mmittee by eomm,uee

65. Clerics

66. Misappropriation etc fi1. Mectingt

68. Removalofmemberofsllpffl'.isoryoommiUee

69. El~tion.of directors

70. Tenureoldi.recU>rs

71. Bormwmgpuw~ofBae.r<l.

72. Valicli.tyofaetsofdirecton, andoffirm

73. Indernmfw.ation ofdirecton,

74. Duty of careof4irectorsaud officers

75. Ambit of ifu-ector's duty 199 No. 28] Co~operalive Societies Act {' 1999.

76. Liability of directors

77. Misuse of confidential infonnation

78. Material contracts

79. M(..'ciings of directors generally &O. Meetings by lelephoneetc. g l Attendance al meetings S2. Inaugural meeting of directors

83. Director ceasing to hold office &4. Removal of directors

85. Notice of change in directors

86. Declaration by directors and officers

87. Bonding

88. Remuneration of directors

89. Remuneration of officers and employees PARTV FINANCING

90. Shares

91. Share capital

92. Issue of shares

93. Alteration of authorised capital

94. Limitation on purchase of shares

95. Transfer of shares generally

96. Transfer of shares of member of unsound mind

97. Transfer of shares or interest on death of member

98. Restriction on transfer of shares

99. Conditions for transfer of shares IOO. Powerofnomination PARTVI BuslNESS OF SocmrY !OJ. Marketing of produce through the society I02. Creation of charge in favor of society

103. Execution and registration of charge

104. Claims unaffected by charge

105. Prior claims in favour of society l 06. Enforcement of charge

107. Assignment of charge

108. Bond as additional security for loan

109. Lien on shares

110. Deductions applied to loans and shares

111. Purchase of shares

112. Prohibition on purchase of shares

113. Compulsory sale of shares 200 No. 28] C:o..operative.Societies Act [ 1999. PARTVD PROPERTY AND FUNDB Of SoclETY 114. lnvestmentoffWlds

115. Loan by society I 16. Prohibited loans

117. Receipt of loans and deposits

118. Receipt of deposits from minors I J9. Reserve Fund liquidity reserve and adequacy of capital

120. DevelopmentFwi.d J21. Pension Fund

122. Charitable contributions

123. Dividend or bonus PARTVIIl I;1NANC1Al, D1scL05URE AND Aumr

124. Annual fmancial statements

125. Approval offinancial statements

126. Furnishing financial statements

127. Auditor's qualifications

128. Disqualifying auditor

129. Appointmentofauditor

130. Cessationofoffice

131. Removalofauditor

132. Filling vacancy of auditor

133. Registrar appointed auditor

134. Auditor's right to notice

135. Requirednotice

136. Auditor's rightto comment I 37. Examination by auditor

138. Auditor'srightto inspect

139. Error or mis-statement

140. Privilegeofauditor

141. Annual end special returns PARTJX REcoNSTRUCTION OF Socrn·ni;s

142. Methods of reconstruction

143. Conversion . 144. Effectofcertificateofn:gistration

145. Amalgamation of societies

146. Tnmsferofassetsofsocieties

147. Claims of objecting creditors

148. Divisionofsociety

149. Effect ofregistration ofnew societies 201 No. 28] Co-operative Societies Act ( 1999. PARTX RF..cEJV.:Rs ANa REcslVER-MANAGllRs

1SO. Receiver appointed by Registrar

151. Func1ionsofreceiver

152. Functions of receiver-manager l S3. Cessation ofBoard's powers

154. Receiver's duly ) 55, Directions by court

156. Di:rectionsbyRegistrar

157. Required actions of rer:-e.iver PARTXI D1SOOL.UTION l 58, Dissolution by tnembers l 59. Notice of dissolutio11 by members

160. Dissolution by Registrar

161. Dissolution for failure to account for business ttansacted

162. DissolutionbyCoW't

163. Revivalofdissoh•edsociety l 64. Appointment ofliquidator l 65. Comm.en£cment ofliquidation

166. Ces-sationofbUsiness

167. General provisions respecting liquidators I68. Duties of liquida(or

169. Powersofliquidator

170. Limitation on liability of liquidator

171. Costsofliqui~tion

172. Closureofliquidation

173. Custody of records

174. Remunerationofliquidator

175. Continuation of actions

176. Unknown claitnants or members I 77. Power of Registrar to surchrtrge l 78. Appeal aeainst surcharge 179, Applic11tionofPartXI PARTXIl INVESTIGATIONS

180. Examination 13\. Investigations.

182. Courtorder

183. Powersofinspector

184. Hearing in camera · }85. Incriminating statements ····1~solute privilege resp~ting statements 202 No. 28] Co-operative Socie1ies Act f I 999. J>ARTXlll Dis:rvrns J87. SettkJlltmi of disputes l 88. Cooperative Societies Appeal 'fribunal

189. Case stated on question oflaw

190. Enforcement of awardanil recovery of1oan f>ARTXIV Spi;:c1Al..12en SocnmEs l 9J . Intetpretation and application Division A : Credil Union l 92. Restrictions

193. Liquid as1.1ets l94. Allowaroces

195. Loan approval 1%. Security for lo3t!S 197. loan limits

198. Reporting loans

199. Interest on loans

200. Deposits 2m . Credit union and trusts Division J3 : Consumers' Societies and Ho11.ring Societie~

202. Restrictions on d.ireclorship

203. Relationship with members

204. By-laws

205. Amcr1dment ofby-laws

206. No interest onsh.attca}Yl\a\

207. Right to possession tem'.i\\a\ed

208. Abandoned goods Division C: l11d11stria! Societie;s 20'i. Membership 2 lO. By-laws 21 I. Res!.riction on registration

212. Bonus based on labour

213. Employees may be directors PART.XV ArExBoDY

214. Establishment and consti.tv.ti.Qu of apex body. 11 S.. F·unctions

216. Offu:ers

217. Consultation by Regisrmr 203 No. 28] Co-operative Societies Act r 1999. PART}{VI

218. Corrupt practices and bribery

219. Falsely obtaining property of society

220. Failure to c:.omply\\~tli Act

221. Dealing in property subject to charge

222. Offences with respect to reports 223, Contrnvention of Act

224. Use of words "credit union" or "co-operative"

225. Order to comply

226. Limitation

227. Preservation of civil remedy XVII MiscELLANEOUS 228. lnteipretation

229. Execution and filing

230. Waiverofnotice

231. Certificate of society

232. Copies of docmnents

233. Alteration

234. Corrections

235. Exemption from stamp duty and taxes

236. Limitation ofjurisdiction

237. Proofofentries in books and documents

238. Regulations xvm TRANSITIONA!,

239. Thefonner Act

240. Existing directors and officers 24 L Existing societies

242. Repeal and savings 205 No. 28] Co-operative Societies Act [ 1999. l AssEm (L.S.J PEARLEITE LOUISY, Governor-General. 7th September, 1999. SAINT LUCIA No. 28 of 1999 AN An to make new provision with respect to the registration, supervision and management of certain societies, the members of which have a common bond of philosophy and socio-economic objectives and for related puq,oses. ( 11th September, 1999 J BE IT ENACTED by the Queen's Most Excellent Maje!'lty, by and with the advice and consent ofthe House of Assembly and the Senate of Saint Lucia, and by the authority of the same, as follows: 206 No. 28 J Co-operative Societies Act J 1999. PARTl PRELIMINARY Short Tttle.

1. This Act may be cited as the Co"()perative Societies Act, l 999. Jnte~bltion. 2.-- ( J) In this Act "articles'' means the articles of association of a societv that are . submitted to the Registrar with an application for the registration of the society; ~ ''board" means the Board of Djrectors or other directing body (by whatever name called) to which the management of the affairs of a society is entrusted; "bonus" means a share of the profits of a registered society divided among its members in proportion to the volume of business done with the society from which the profits of the society were derived; "by-laws" means the registered by-laws made by a society pursuant to this Act and includes a registered amendment of such by-laws; "co-operative" or "co-operative society" means a body corporate registered underthis Act which consists of a group of people, small or large, with a commitment to joint action on the basis of democracy and self-help in order to secure a service or economic arrangement that is both socially desirable and beneficial. to all taking part; "Court" means the High Court of Justice; "Credit Union" means a registered society whose objects and services include the promotion of thrift and the creation of a source ofcredit for its members for provident and productive purposes; «director" means a member of the board who is elected in accordance ,vith section 69; "dividend'' means a share of the profits of a registered ~ciety divided among its members in proportion to the share capital held by them; "member" includes a pe.rson or registered society joining in the appJication for the registration of a society, and a person or registered society admitted to mem.bersltip after registration in accordance with ~is Act and the by-laws; "minor" means an individual under the .age of sixteen yea.(S; 207 No. 28] Co-operative S<JCieties Act { 1999. '·nationa1 league'' or '·National Council" means the apex body for · registered societies established for the purposes of section · 214; · . . . . "officer" includes a director, secretary, treasurer, or other person empowered under the regulations or by-laws to give directions in regard to the business of a registered society; '·society" means a co~opcrative society and includes a society registered under this Act; (2) This Act applies to societies which are registered under this Act or deemed, by virtue of section 241, to be registered under this Act. Ct>·OJ)f'nltiYe p.riJJclp!i,s.

3. For the purposes of this Act, a society confonns to CO-Qperative principles where ~ (a) except in the case of a secondary or tertiary society no member or delegate has more than one vote; (b) no member or dele_gate is entitled to vote by proxy; (c) its business is carried on primarily for the benefit of its members; (d) its membership is voluntary and available without any artificial restriction or any unlawful basis ofdiscrimination, to any person who can use its services and is willing to accept the responsibility of membership; (e) the rate of dividends on share capital that it pays does not exceed the rate pre.scribed in the Regulations; (/) any surplus or savings arising out of its operation is - (i) used to develop its business; (ii) used to provide or improve common services to members; (iii) used for the payment of dividends on share capital; (iv) distributed among members in proportion to their patronage with the society; (v) used to educate its members, officers. employees or the general public in the principles and techniques of economic and democratic co~peration; and (vi) distributed for non-profit, charitable, benevolent or cultural purposes; (g) cooperation with other societies is pun;ued; (h) it provides for continuing membership education. 208 No . .28) Co~operative Societies Act ·[ 1999, Conformity t11 oo-operiitive principles. . . ,, , ~.:.·A society regi~tered_ ·under this Act _$hall, while it is so registered, confonn to the co-operative principles set out in section 3. "PARTII ADMINisTAATION Registrar of co-opiirativ.e societies. S. -(I) There shall be a Registrar of co-operative societies who shall have such professional, administrative and other staff as are necessary to assist him in the execution of his duties and in the exercise of his powers-under this Act. (2) The Registrar shall be responsible for the: .(a) registration of all societies; (b) supervision of all societies; (c) stimulation of community awareness; (d) initiation and encouragement of organised activities for the development of societies; (e) maintenance of ad.equate and re\iab\e records; (t) management of the Department of Co-operatives. · ·(3) The Registrar may, in writing, delegate any of-his functions specified-in subsection (2) to a suitably qualified member of his staff or to any other quaJified person or body of persons connected with co-operatives and any function so delegated shall be performed in such manner as the Registrar directs. (4) Nothing in subsection (3) shall ·authorise the ·Registrar to. delegate the power of delegation that is· conferred on him by th!!t subsection. Certificaw of Registrar.

6. - (1) The Registrar may furnish a person with a certificate stating tbat- la) a document required to be sent to '\he RegisttaI bas 01 bas not been received by him; (b) a name, whether-that of a society or not, was or was not on the register; (c) aname1 whether.thatofasocietyornot,-wasorwasnoton the register on a stated date. (2) When this Act requires or authorises the Registrar to issue a certificate or to certify any fact, the Registrar or other person delegated by him shall sign the certificate or the certification. 209 No. 28] Co-operative Societies Act 11999. (3) The signamre required pursuant to subsection (2) may be printed or mechanically reproduced on the certificate or certification. (4) A certificate or certification mentioned in subsection (2) is admissible in evidence as conclusive proof of the facts stated in the certificate or certification wlthout proof to ihe office or signature of the person purporting to have signed the certificate or certification. Power to refuse documents.

7. -(I) TI1e Registrar may refuse to receive, file or register any document that in his opinion - (a) contains any matrer contraiy to law; (b) has not, by reason ofany omission or error in description, been properly completed; (c) does not comply with the requirements of this Act; (d) contains any error, alteration or erasure; (e) is not legible; or (/) is not durable. (2) The Registrar may request in respect of a document refused pursuant to subsection (I) ~ · (a) that it be amended or completed and resubmitted, or (b} that a new document be submitted in its place. Verification ofdccumen1s. · 8. Where this Act or Regulations under this Act requires that a document or information contained in a document is to be submitted to the Registrar, the Registrar may require verification of the document or information contained in the document by affidavit or otherwise. Application for registration.

9. - (1) No society may commence or continue business unless it is registered in accordance with this Act. (2) Subject to subsection (3) an application for registration under this Act mustbe submitted to the Registrar in the prescribed fonn and in such manner as he determines. (3) An application for registration under this Act mustbe signed by at least- (a) fifty persons in the case of a Credit Union; (b) five persons in the case of a Workers Society; (c) twenty-five persons in the case of a Consumer Society. (d) ten persons in the case of a Housing Society;· 210 No. 28] Co-operative Societies Ac1 I 1999. (e) ten persons in the case of an Agricultural Society: and (j) ten persons in the case of other societies not specified in paragraphs (a) to (e). (4) An application must be accompanied by - (a) three copies of the proposed by~laws of the society: (b) the prescribed application fee; and (c) such other information in respect of the society as the Registrar requires. Content Qf by-laws. 10. ~ (l) A registered society shall include in its by-laws provisions respecting - {a) conditions of membership, including - (i) the rights of joint members, if any; (ii) the qualification for membership and the withdrawal of members and transfer of membership: (iii) the amount of the membership fee and the annual fee, if any, to be paid by members: (iv) the conditions on which membership ceases or may be tem1inated, the disposition that may be made on cessation or termination of a member's interest and the detennination of the value of the member's interest; and (v) the minimum value of shares that may be held by each member; · (b) subject to this Act, voting rights and the rights of making,. amending and repealing by-laws, the right of members to vote by ballot and the manner, form and effect of mtes at meetings; (c) directors, officers and membership of the committees of directors, (i) their qualifications, terms of office and removal, (ii) the filling of vacancies, and (iii) their powers and duties; (d) the address of the registered society; (e} the distribution of the property of the society on dissolution of the society; (fJ the borrowing powers of the society and the procedure for exercising those powers: and 211 No, 28 J Co~operative Societies Act f 1999. (g) any matters, in addition to those set out in paragraphs (a) to (f) that the members consider necessruy or desirable. (2) Subject to subsection (3 ), where the by-laws require a greater number of votes of directors or members than that required by this Act to effect any action, the by-laws shaJl prevail. •(3) The by-laws may not require a greater number of votes of members to remove a director than the number required for a special resolution. Efild 1Jf by-li;wa. l J. The by-Jaws of a society when registered bind the society and its members to the same extent as if they - (a) had been signed and sealed by the society and by every member; and (b) contained covenants o.n the part of each member and the legal representative of each member to obseive the by-laws. Candfflvmforl'egtstt'llfion.

12. -(J}Nosocietymay be registered, or having been registered~ continue to be registered under this Act - (a) unless its membership consists - (i) in the case of financial co-operatives, of not less than fifty mcmbe.rs, and (H} .in the case of any other co.operative of not less than five members; (b) unless it is considered to be economically viable by the Registrar and has provision for equity capital expansion and continuous business growth~ (c) unless subject to subsection (2), its membership consists solely of members of a school, club, or cultural organisation who are aU under the age of sixteen years: · (d} unless th.ere is confomity among its membership, none of whom is another society, with all the \XJ-operative principles as set out in section 3; (e) unless the word "co--operative" or "C;edit Union"' fonns part of the name of each such society, and a society whose membe1:Ship falls within the description contained in paragraph (c) the words 'junior co--c:,perative'1 fonns part of the name of suclt society: 212 No. 28 'J Co-opera(ive Societies Act { 1999. (f} unless the word "limited" is the la.st word of the name of a society to be registered with limited liability; (g) if the name of the society is identical with tl1at of anotlier registered society or which so nearly resembles that name as to be Iikely to misiead the members of the pub(ic as to its idenfay: (};) unkss it has and maintains an address to whic,h aJJ notices and- communications may be sent; (i) unless its by~iaws are in oonfomrity with this Act; (j) unless, within a reasonable time after the issue of the" certificate of registration, the society paints or affixes its registered name in letters that are easily leg1ble in a conspicuous position on the. e;-..'terior of the, place where the business of the society is carrie.d on, and in the case of a society registered under section (5, its registered name bears the words "Probationary Society". (2) Notwithstanding anything contained in paragraph (c) of subsectJOJl (1), the Registmr may register as a junior co-operative a society the substantial majority of whose members are under the age of sixteen years. (3) In the detem1inatian of the viability of a society the Registrar may have regard to ,__ {a) the demand for the proposed services, (b) the capital base of the society, and (c) the membership size and potential of the society. R~t:hltnrffup (>_f 8<,d~es.

13. - (l) When the Registrar is satisfied that the application is made in accordance with this Act, he shall, within three months of the receipt ()f the application, register the society and its by-laws and issue that society with a certificate of registration in the prescribed form. (2) The name under lVhich a society 1s registered under this Act-- (o) shall be published in the Gazt!lle; and (b) shall be noted i11 the register to be known as the "Register of Societies" and which shaU be kept at the office of the Registrar, (3) Where the Registrar refuses to register a society he shall give the applicant reasons in writing for the refusal_ 213 No. 28 J Co-operative Societies Act 11999. (4) The names of all societies that arc registered under this Act shall be entered in the Register of Societies. Effeu of certificate on regutration.

14. - (l) Except for a society that is deemed to be registered under this Act a society comes into existence on the date shown on its certificate of registration. (2) A certificate of registration issued by the Registrar to a society is condusive proof that the society named in the certificate is registered under this Act and has complied with all the requi remcnts of registration under this Act Probationary ~ocleties.

15. - (l) If the Registrar is satisfied that a society which has submitted an application for registration should not be registered as a registered society, he may register such society for a period not ·. exceeding twelve months. (2) A society registered under subsection (I) shall be tem1ed a "probationary society" and shall be subject to such conditions as the Registrar may impose. (3) If the Registrar is satisfied that a probationary society has made sufficient progress in complying with the conditions imposed on the society, he may register the probationary society as a registered society. (4) If the Registrar is not satisfied that a probationary society has made sufficient progress in complying with the conditions imposed on that society, he may extend the probationary period for a further period not exceeding twelve months, or cancel the registration. (5) If at the end of the second year the Registrar is satisfied that a probationary society has made sufficient progress in complying with the conditions imposed on that society, he may register that society as a registered society; otherwise he shall cancel the registration. Capacity and powers. 16. :._ ( l) The registrn_.tion of a society renders it a body corporate, and subject to this Act and its by-laws it has the capacity, rights, powers and privileges of an individual. (2) A society shall not carry on any business or exercise any power that it is prohibited by its by-laws or any written law from C311Ying on or exercising nor shall a society exercise any of its powers in a manner contrary to its by-laws. 214 No. 28 l C'o~operative ,\'ocieties Act I t 999. (3) No person is affected by, or presumed to have notice or knowledge of, the- contents of a document concerning a society by reason only that the document has been filed with the Registrar or is available for inspection at any office of the society. {4) Subject to the approval of the Registrar and unless the societies have agreed in writing no person shall be a member of more than one registered society whose primary object is to grant loans to its members. Rtgistered Ofl\l'e.

17. - ( l) A society must at all times establish and maintain a registered office and the address of such office must be specified in the by-laws. (2) The directors of a society may change the address of the registered office. (3) The Registrar must be informed of any such change of address within one month of such change. Mail\tem,.nct, ofmandatory rec<,nb.

18. - (I) Every society shall have its certificate of registration pennanently displayed at its registered office. (2) Without prejudice to subsection (l), there shall be made available at all reasonable times at the registered office of the society - (a) a copy of this Act and any regulations made thereunder; (b) a copy of the by-laws of the society; (c) the registe-r of members; (d) all minutes of meetings of members and resolutions of members; (e) copies of all notices of directors and notices of change bf directors; (j) a register of its directors setting out the names, addresses and occupations of all persons who are or have been directors of the society with the dates on which each person became or ceased to be a director; (g) a copy of every certificate issued to it by the Registrar; (h) a copy of every order of the Registrar relating to the society; and (f) all minutes of meetings of director.; and committees. 215 No. 28 l ('o-operarive Societies Act l i 999. 19, - (J) The Registrar may, dming the nonnaJ business hours of the society, examine any of the records specified in section 18 (2). (2) Members of a society, their agents and their legal representatives may, during the normal business hours of tl1c society, examine any of the records specified in section 18 (2) (a) to (h). (3) A society shall give to any person specified in subsections (l) and (2) access to any record specified in section IS (2), during normal office hours of the society, Smpen.sion iu,d canc.ella:tion of r.-gbh·11tion. 20, - (I) Subject to this Act, the Registrar may by order in writing suspend the registration of a society if he. is satisfied that - (a) the society is in breach of any condition of registration; (b) the society is in breach of any requirement of section 3 or 12 of this Act; (c) the society or any officer failed or refused to comply with any obligation imposed by, or any requirement of this Act, the regulations or by-laws; (d) any return notice orotherdocumentorfee required by this Act or the regulations to be submitted to the Registrar has not been received by him. (2) The Registrar may by order in writing cancel the registration of any registered society if- (a) at any time it is proved that the number of members has been reduced to less than the number required for the registration of the society; ( b) it is proved that the registration has been obtained by fraud or mistake; but a cancellation under paragraph (a) sha1l not apply to a society which includes among its members one or more registered societies. (3) An order under subsection (1) or (2) shall take efrect from the date of the order. (4) No suspension or cancellation may be made by the Registrar until he has given the society a chance to be heard; and a suspension shall not exceed twelve months. (5) Where after a period of suspension a society bas not rectified the circumstances leading to its suspension, the Registrar may cancel the registration of that society. 216 No.28] Co-operative Societies Act [ 1999. (6) Where the registration of a society is cancelled by order under this section or any other section the society shall, except for the purpose of winding up, cease to exist as a body corporate from the date on which the order takes effect Seal

21. -(l) The Board may by resolution - (a) adopt a corporate seal; or (b) change the corporate seal adopted pursuant to paragraph (a). (2) An instrument of agreement executed on behalf of a society by a director, an officer or an agent of the society is not invalid merely because a corporate seal is not affixed to it. Pre-registration ronfracts.

22. - ( I ) Except as provided in this section, a person who enters into a written contract in the name of or on behalf of a societv before it comes into existence is personally bound by the contract and 'is entitled to the benefits of the contract ·(2) Within a reasonable time after a society comes into existence, it may, by any action or conduct signifying its intention to be bound thereby. adopt a written contract made in its name oron its behalf, before it came into existence . . (3) .Where a society adopts a contract under subsection (2) ·(a) the society is bound by the contract and is entitled to the benefits thereof as if the society had been in existence at the · date of the contract and had been a party to it; and (b) ·a person who purported to act in the name of the society or 6n its behalf ceases except as provided in subsection (4) to be bound by or entitled to the benefits of the contract. .. (4) Except as provided in subsection (5), whether or not a written contract made before the coming into existence of a society is adopted by the society, a party to the contract may apply to a court for an order fixing the obligations under the contract as joint or joint and several, or apportioning liability between the society and a person who purported to act in the name of the society or on its behalf; and the court may upon the application make any order it thinks fit. (5) If expressly so provided in the written contract, a person who purported to act for or on behalf of the society before it came into existence is not in any event bound by the contract or entitled to the benefits of the contract. 217 No. 28] Co-operative Societies Act ! 1999, PART III Mm11mRRs1m• AND M1mrINos Application and qWlllflcatlon for mtmbershlp. . 23. -:-- (l) An application for membership of a society must be to submitted the Board in such fonn as the Board approves. · (2) ln order to quaJjfy for the membership of a society, a person, other than a registered society, (a) shall be a citizen or a resident of Saint Lucia; (6) shaH not be an undischarged bankrupt; (c) shall not be of unsound mind: and (d) shall be sixteen years of age or over. (3) The Board shall cause each applicant fur membership to be notified in writing that his application has been approved or disapproved. (4) No society shall without permission of the Registrar register as a member a person who is a member of another society whose primary object is to grant loans to its members, neither shall a registered society become a member of another registered society of the same type. Joint a1:counts..

24. Subject to the by-laws, where individuals have separate and independent membership in a society,joint accounts may be held. iHem~p f;,esqd mendta11itlp ~ter.

25. - (1) No person shall exercise the rights of membership of a society unless and Wttil he has paid the prescribed membership fee and has .satisfied any other requirement which may be prescribed by the by-laws. (2) A registered society shall keep a register of members in which shaU be recorded - (a) the names and addresses of members; and (b) the date on which each member became a member and the date, if any, on which he ceased to be a member. llshWjy ofp,ut and pn.llQlt ,ne,nb~n.

26. - ( 1) Subject to this Act, the liability of a current mcm bcr of a society is limited to the paid shares and the unpaid amount of subscription for shares. (2) The liability of a past member or the estate of a deceased member for debts of a society as they existed on the date on \Vhi ch sucb member ceased to be a member or died shall continue. for a p-:riod of two years after the cessation of membership or death. 218 No. 28 J Co-operattve Societies Act { }999. Withdral'II al ofmember.ihip. Z7. ~ (l) A member of a society may at any time withdraw from membership of such a society in such maJ1ner as may be prescribe-d by the by-laws or regulations. (2) Withdrawal of membership from a society may be by written notice addressed to the Board. (3) Withdrawal of membership of a society does not affect any existing liability of the member to the society. 'ferrnlnatlon ofmembenhip by Board.

28. - (1) Subject to the by-laws, the Board may, by at least two-thirds vote of the directors present at a meeting called for that purpose, order the terrnination of membership of a member ofa society. (2) Where the Board terminates the membership of a member pursuant to this section - (a) the Board shall (i) within a period of one year, purchase from the member at par value all shares in the society held by the member, and (ii) pay to the member all amounts held to his credit, together with any interest accrued on those amounts and the amount outstanding on loans made to the society by the member with any interest accrued on those amounts~ (iii) request the member to settle all debts due to the society within a reasonable period; (b) the secretary of the society shall, within ten days from the date on which the mder is made, notify the member of the order; .and (c) the member may appeal the order made under subsection (I) to the next general meeting of the society by giving written notice of his intention to appeal to the secretary within thirty days from the date he received notice of the order pursuant to paragraph (b), (3) Where the member appeals pursuilllt to paragraph (c) of subsection (2) a majority, or any greater percentage that may be specified in the by-laws, ofthe members present at the general meeting shall confinn or rescind the order. (4) Where the address ofa member whose membership is ordered to be terminated pursuant to subsection ( l) is unknown to the society after aU reasonable efforts have been made to ascertain his address for the puipose of making payment to him of all amounts held to his credit, the society shall transfer those amounts to its Reserve Fund. 219 No. 28 l Co-operative ,.\'ocieties Act l 1999. (5) Where any amounts arc transferred pursuant to subsection {4), the society shall pay those amounts to the person entitled to them on proof of his claim that i.s satisfactory to the society. {6) Where a society transfers amounts held to the credit of a member pursuant to subsection (4). it shall immediately submit to the Registrar a return showing - (a) the member's name: (b) the member's last knovm address; and (c) the amounts transferred. Tennim1tiol'l efmembel'llhi.p by 111emb11T<1.

29. Members may tenninate the membership of a member where, (a) the member has received at least ten days notice of the general meeting at which his membership is to be considered: and ( b) the termination is approved by a majority or at least two~thirds of the members who (i) are present at the general meeting, and (ii) cast votes on the resolution. SusJWJUion of membenhip.

30. TI1e Board of a registered society may by notice in writing suspend a member for a period not exceeding three months if they are satisfied that he is guilty of stated misconduct. Appeid.

31. - (l) Subject to subsection (2), where a person's membership is terminated pursuant to section 28 or 29, he may appeal the tennination to the Registrar in the prescribed manner, and the Registrar shall confim1 or set aside the resolution tenninating the membership. · (2) No person whose membership is terminated for failure to pay fees, assessments, rent or occupancy char:res or to fulfil other financial obligations to the society is eligible to appeal the termination to the Registrar pursuant to subsection ( 1). (3) Where a person appeals the terminatkn of his membership pursuant to section 28 (2) (c) or this section, notwithstanding the resolution terminating his membership, he cor.tinues to be a member until the termination of his membership is confirmed by the meeting of members pursuant to section 28 (3} or by the Registrar pursuant to this section, as the case may be. 220 No. 28] Co-operarive Societie1> Act r 1999. Re-mimittance.

32. A pe,son whose membership is terminated pursuant to section 28 or 29, may be re-admitted to membership only by a two-thirds majority vote of members µresent and voting at a general meeting. Vottng .rights. 33. -- (1} A society that is a member of another society shall exercise its voting tights in that other s-ociety through one of its members duly appointed in tliat behalf. (2) Delegates eJected in accordance with the by-laws ofa society may, unless otherw-ise provided in the by-laws; exercise at annual an:U special meetings of the society all the powers of members, and in such cases all references in thfa Act to the exercise of powers by members shall be deemed to include the exercise of powers by deJegates. Reyresentattve ofmemb,,r who& n<1t mi Jndivldmd . . 34. - {l) Where .a registered society is a member of another registered society, the latter society shall recognize any individua{ authorized by a resolution of the directors of the fonner society to represent it at meetings of the latter society. (2) An individual. authorized pursuant to subsection (1) may exercise, on behalf of the society, all the powers of that society as if it were an individual member, Voling prooe,:lme.

35. - (I) Subject to the by-laws, members shall vote (a) by a show of hands, or {b) where the majority of the members entitled to vot.e at a meeting so demands, by secret ballot. . . (2} The chairman of the meeting has the right to vote, and in the event of a tie he is entitled to a second or casting vote. ' . (3) .Subject to th1s Act and by~Jaws, a majority oft.he members vvbo an are present and cast votes at a meeting shall decide questions. • Place of mee\ing.

36. General meetings of members must be held iu Sa.int Lucia, {a) at the place provided in the by-laws, or (h) where the by-laws contain no provision, at the plac.e determined by the Board. Memb~rs Mt to exercise rights 1.1nti! due pa.ymtnl.

37. No member of a registered society shall exercise the rights of a member unJe.ss he has made such payment to the society in re-spect of membership or acquired such interest in the society as are prescribed by the regulations or b~--laws. 221 No. 281 Co-operative Societies Act . ( 19Y9. . First r•»enil meeting. 38. _,.,... .(l) This section does not apply to a society continued pursuant to this Act. {2) Within two months of the date of its registration, a society shall hold a general meeting at which all members are entitled to be present and to vote. (3) Notwithstanding subsection (Z}~ where the Board applies to the Registrar, he may extend tbe time for holding the general. meeting. (4) The business at the general meeting mentioned i.n subsection (2) must include. {a) the adoption of the by-Jaws; (b) the adoption of fonns of share certificates and records of the society; {c) the authorizing of the issue of shares; {d) the appointment of an auditor to hold office until the next annual general meeting~ (e) the making of banking arrangements; and (f) the transaction of any other business. Almu'lf 1meaimfflU\&,,

39. - (l) A society shall hold an annual meeting in each year not laterthan three months after the end of the financial year of the societr. (2) Notwithstanding subsection (1) and notwithstanding that the time for holding a general meeting .as required by this section has expired, where the Registrar receives a written request from the Board, he may authorize the society to hold the annual general meeting at any date not later than six months after the end of the financial year of the society ifhe considers it appropriate. · (3) The by-la.ws may provide for holding semi-annual or other periodic meetings. ~meetinp,

40. - (1) The Board :ina..y caU a special meeting ofmembers at any tune. . (2) Subject to- subsection (3), the Board shall caU a special meeting ofthe members on reoeipt of a written request, specifying the purpose of the meeting, from su.ch number of members as may be specified in the by-laws. 222 No.1S l Ce>-operative Societies Act ( 1999. (3) The Board shall caU the special meeting mentioned in subsection (2) within twenty .days of their receipt.of the requestand the special meeting is required to dispose of the specific business.outlined in the request. (4) The Registrar may caU a special meeting of the society - (a) for the purpose of reporting to the members the results of any audit, examination QJ other investigation of the society~s affairs ordered or made by him, or · · (b) where the society fails to hold an annual general meeting in accordance with section 39 (1) or (2), for the purpose of enabling members to secure any infonnation regarding the affairs of the society that they are entitled to receive pursuant to this Act and to deal with any matters affecting the society. MeednJcalled lly ~ -

41. - (1) Where (a) in the opinion of the directors it is impracticable- (i) to call a general meting of members in the manner in which meetings of members may be called, or (ii) ·to conduct a general meeting of members in the manner prescribed in this Act or in the by-laws; or (b) for any reason, in addition to those described in paragraph (a), the Registrar considers appropriate, the Registrar on his own initiative may if be is satisfied that such a meeting is wammtcd in the circumstan®s order a general meeting to be called, held and conducted in any manner that he directs. {2) Notwithstanding subsection {l), the Registrar may order that the quorum required in this Act or the by-laws be varied or dispensed with at a geneial meeting called pursuant to this section. . · (3) A general meeting caUed pursuant to this section is deemed to . bea valid meeting. l\esolatlon ln ll.eu of metdng.

42. - (1) Except where a written statement is submitted by an auditor pumuant to section 136 · (a) a resolution in writing signed by such number of members as · are entitled to vote on that resolution at a general meeting of members as may be specified in the by~laws is as valid as if it bad been passed at a general meeting of the mentbers; and 223 No. 28 I Co-operative Societies Act [ [999: (b) a resolution in wr.itinei dca1 ing with any matter required by this Act to be dealt withatagene.ral meeting ofmembers and signed by all the members entitled to vote at that meeting, {i) satisfies all the requirements of this Act relating to meetings of members, and (ii) subject to subsection (2), is effective from the date specified in the rcsoJution. (2) The effective date of a resolution described in subsection {l) (b) (ii) mu.st not be earlkr than the date on which the first member signed the resolution. (3} A copy of every resolution described in subsection([} must be kept with the minutes of the meetings of members. NOiie;,, ofmeeti11gs. 43, - (I) A society sh.all give at least ten days' notice of any annual or special meeting to its members - (a) by sending the notice by mail to the members, at the addresses given in the register of members, or (!;) by inserting the not1ce in not less than two issues of a newspaper circulating in Saint Lucia and posting the notice in a place that, in the opinion of the di recto~, is prominent and ac.cessiblc to members. {2) Notv.'ithstanding any other provision of this Act, where a society is required to send a st:atement, agreement, proposal or other document to its members with a notice of a meeting and decides to insert the notice of a meeting in a newspaper pursuant to paragraph (1) (b), the society shall, (a) in the notice, infonn the member of the document, giving a description of the document that, in the op.1nion of the. director, is adequate to describe its nature, and (b) make a copy (Jf the document available to any member or dekgate who requests it. (3) The notice of any special meeting must specify the purpose for which the- meeting is being called. (4) The proceedings or the business transacted at a general meeting are deemed not to be invalidated by reason only of the non-receipt by a member of notice of the meeting. Pi;,,;ing record date.

44. -(1) Subject to subsection (2), for the purpose ofdetemiining members 224 No. 28) Co-operative Societies Act f l 999. (a) entitled to receive payment of a bonus or dividend, (b) entitled to participate in a distribution on liquidation, or (c) for any purpose in addition to that described in paragraph (a) or (b), except the right to receive notice of or to vote at a general meeting, the Board may fix in advance a date as the record date for the determination of members. (2) The record date mentioned in subsection (I) is not to precede by more than fifty days the particuiar action to be taken. (3} Subject to subsection (4), for the purpose of detennining members entitled to .receive notice of a general meeting, the Board may fix in advance a date as the record date for the detennination of members. (4) The record date mentioned in subsection (3) is not to precede by more than fifty days nor by less than eleven days the date on which the meeting is to be held. (5) Where the Board does not fix a record date, (a) the record date for the determination of members entitled to receive notice of a general meeting is (i) the close ofbusines$ 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 members for any purpose other than that described in paragraph (a) is deemed to be at dose of business on the day on which the Board passes a resolution relating to that purpose. · Quorum

45. - (1) Subject to subsection (2), the quorum at any annual general or special meeting of members is that fixed in the by-la,vs. • (2} Except where all the members are directors, the number of members present at an annual, general or special meeting must not be less than the number of directors plus three. (3) Subject to the by~laws, where a quorum is present at the opening of a general meeting of members the members present may proceed with the business of the meeting. (4) Where a quorum is not present one hour ajter the time fixed for the commencement of a general meeting of members, the members present may adjourn the meeting to a time and place to be determined by the Board but not later than thirty days after the date of the ~ioumed meeting but may not transact any other business. 225 No. 28] Co-operative Societies Act { 1999. (.5) 1f at the ,econvened meeting there is no quorum the members present constjtute a quorum ,and may proc.eed with the.meeting. Delegates.

46. - (I) Where the by•laws of a society provide for the nomination and appointment of delegates to a general meeting (a) the delegates shall exercise the powers of membership at any annual or special meeting; and ·· (b) reference irt this Act with respectto the exercise_ofany power mentioned' in paragraph (a) shall be coustrued as a reference to delegates. . . · (2) Tue members who elect delegates may, at a sp~dal meeting called for the purpose or .at any annual meeting, . .: . , · (a) remove the delegates in any manner -provid,~c;l for in the by•laws; · (b) notwithstanding subsection (1). amend tl\e by~laws to eliminate the nomination and appointment of delegates. Propouls.

47. - ( 1) A member who is entitled io vote at an annual meeting.of members ma:_v · : ·· (o) submjt to the sodefy notice of anymalter that he_ p:ropose,s to raise at the meeting; and (b) discuss at the meeting any matter with respect to .which he · would have·been entitled to submit apropos.a\. . · (2) Where a member submits a proposal and requests the directors of the society to send the proposal with the no~ce of the_ meeting at which die p-roposaJ is to ·be presented or make. the proposal available to aU membm;s entitled to attend and vote at that meeting, the society shall comply. . .. ,. . . . . (3) Wh~re a member submits a proposal.and reque~s the society to include in or attach to the notice. (a) a s1atement by the member ofnot more than iwo hundred words in support of the. proposal, and ·· (b) the name and address ofthe member, the society ~~aU comply. (4) A society is not required to comply with subsections (2~ and ·t3) where . . (a) the proposal is not submitted to the socjety at least forty~{jvc days before the anniversary date of the previous anriu~ .general meeting of members; 226 No. 28 J Co-operative Societies Act 11999. (b) in the opinion of the directors, the proposal is submitted by the member primarily for the purpose of (i) enforcing a personal claim or redressing a personal grievance, (ii) promoting general economic, political, racial, religious, social or similar causes: (c) the society, at the member's request, included a proposal in a notice of a meeting of members held within two years preceding the receipt of the proposal submitted pursuant to subsection ( 1), and the membe:r fajJed to present tlic proposal at the meeting; (d) substantially the same proposal was submitted to members in the notice of a meeting of members held within two years preceding the receipt of the members request, and the proposal was defeated; (e) in the opinion of the directors, the rights conferred bv this section are being abused to secure publicity. (5) A member who requests that the proposal and any statement be sent ,vith the notice of the meeting at which the proposal is to be pre- sented shall pay the cost of sending the proposal and statement, unless the members present at the meeting provide otherwise by a majority vote. (6) No society and no person acting on behalf of a society shall incur any liability by reason only of circulating a proposal or statement in compliance with this section. (7) Where a society refuses to include a proposal in a notice of·a meeting, the society shall, w·ithin thirty days after receiving the proposal, (a) notif)1 the member submitting the proposal of its intention to omit the proposal from the notice of the meeting, and (b) send to the member a statement of the reasons for the refusal. {8} Where a member claiming to be aggrieved by refusal pursuant to subsection (7) applies to the Registrar. the Registrar may suspend the holding of the meeting to v,,,hich the proposal is sought to be presented and give any directives he considers appropriate. (9) The society or a person claiming to be aggrieved by a proposal may apply for permission for the society to omit the notice of the meeting and, where the Registrar is satisfied that subsection (5) applies, be may give pennission. 227 No. 28] Co-opcrolive Societies Acr , [ 1999. ( .J 0) In ·this section •''proposal" means a· notice .submitted to a society pursuantto subsection (J) (a) .. f"Jwerfo make by-lawi1: . 48.~ (l} Subjec(to this Act and the by4aws.~ the ritetnbers of a society may, at any annual meeting or ariyspecial·meetingcaUed for the purpose, make, amend, repea1, replace or confirm any by-laws, where written notice of the proposed making, amendment, rep-ea], replacement or colifinnation . . . (a) is fmwarded to each member of the society with the notice of the meeting at which the making, amendment, repeal, replacement o.r confinnation is to be considered by a majority of membere present and voting at that meeting; or · {b) is not forwarded to each member of the society with the notice described in paragraph (a) by a three-fourths majc;,rity of members present and voting at the meeting. (2) A member may make a proposal. in the manner provided in section 47. to make, amend, repeal, replace orco.n.finn any by-law. Eff.eclive dale of law.

49. - (l) No by-law has any force or effect until three copies of the by-law, certified to be true copies by the president and secretary of the society, are filed with the Registrar and approved by him. (2) Subject to subsection (3), where a proposed .by-law is certified pursuant to subsection (I) and receives the members' approval required in section 48 (1), the by-law has immediate force and effect. (3) A by-law described in subsection (2) ceases to have any force or effect on the expiration of sixty days aft.er the date of the general meeting in which it is approved by the members, unless, within that sixty day period, the by-law is filed with the Registrar pursuant to subsection (1). (4) Where the Registrar approves a by~law, he shall return to the society one copy ofthe by-law with his approval stamped on the by-Jaw. PARTIV MANAGEMEN'l' Board of directors.

50. - (1) Every society shall be managed by a Board of directors which shall be constituted in accordance with this Act and-the by-laws of the society. 228 No. 28 J Co~operative Societies Act l 1999. (2) The Board shall be. constituted by not less than five nor more than thirteen directors, as specified in the by~laws. (3) The members of a society may amend the by-laws to vary the number of directors, but no amendment to decrease the number of directors shall affect an incumbent director. (4) A person who (a) has been sentenced by a court in any country for an offence involving dishonesty Slid has not received a free pardon for ili~offen~; ' (b) is in default of debt owed to the society or compounds with his creditors; (c) is certified by a medical p,actitioner to be of unsound mind; (d) is or becomes bankrupt; (e) is under the age of eighteen years; (t) is not a member of the society or a duly appointed representative of a member society; (g) is already part of the management of another society of the same type; or (h) is an employee of the Co-cperative Department; shall not constitute part of the management of a society, until his disability is removed, but he may retain his: membership of the society during the period of such disability. (5) For the puiposes of this Part "management" includes (a) a person who holds membership of any committee established by a society; and (b} a person who is employed by the Board. Officers.

51. -(1) Every society (a) is required to have a president, treasurer and a secretary, and (b) may have any officers in addition to those mentioned in paragraph (a) that are provided for in the by~Jaws. (2) Su~ject to the by-laws, (a) the Board may designate the offices of the society, appoint persons as officers, specify the officers duties and delegate powers to manage the business and affairs of the society fur them; and 229 No.28 J Co-operative Societies At'i f 1999, (h) a director may be appointed Jo any office of the society · (3) Subject to the by-laws no person shal} be president or vice- president of a society unless he is a director of tl1c society. · Provisilma1 dircct<irs and elected directori;, 52. ~~ ( l) On the registration of a society. the individuals whose names appear in the application for registrnlion as having been appointed and have consented to act as provisional directors (a) shall have aB the powers and perform the duties of directors; and (/;) shall hold office until the first general meeting (2) At the first general meeting and at every annual general meeting the directors must be elected in accordana: with this Act, the regulations and the by-laws. P{•wers of Bol\fd,

53. Subject to this Act, the regulations and the by-1aws, the Board shall (a) exercise the powers of the society directly, or indirectly through the employees and agents of the society; (b) direct the mallagement of the business and affairs of the societv. Committees gi.,tiera!ly.

54. - (I) Notwithstanding sections 50and 51, the members of the society shall elect a Supervisory Committee which shall perfom1 such duties as are prescribed by the by-laws. (2) Notwithstanding subsection (l), the Board may establish committees for the more efficient management of various aspects of the business or affairs of the Society. (3) A Committee for the purposes of subsection (2) may consi_st of members of the Board and other mem hers of the society. (4) No committee of the Board may -- (a) fill a vacancy among the directors; (b) declare a bonus or dividend.: (c) approve any financial statement of the society; (d) submit to the members any question or matter requiring the approval of members~ or (e) make decisions where the Act or the by-laws require a two- thirds majority or unanimom, vote of the Board. 230 No. 28] Co~operative Societies Act ( 1999. Tenure ()fconunittee~ generally.

55. - (l) Committees appointed pursuant to section 54 (2) shall hold o:ffic.c for a period not exceeding one year. · (2) A member of a committee appointed pursuant to section 54 (2) may be removed by resolution of the society or of the Board, as the case maybe. (3} The removal of a member ofa committee who is a director shall not affect his office as a director. (4) A committee shall (a) fix its quorum at not less than a majority of its members; (b) keep minutes of its proceedings~ (c) submit to the Board at each meeting of the Board or to the annual general meeting of the society, as the case may be, the minutes of the committee's proceedings since the most recent meeting ofthe Board or of the society. Credit committee.

56. - (1) Every credit union shall have a credit committee which shall be elected by its members at the annual general meeting. (2) The members of a credit committee hold office for such tenn as the by-laws provide and until their successors are elected. (3) The credit committee shall consist of the number of members fixed by the by-Jaws, wbicb shalJ beno fewerthan three. (4) No person who is a member of the Board or of the supeivisory committee or who is an employee of the credit union shall be a member of the credit committee. (5) A majority of the credit committee, not jncJuding the secreta.Jy or treasurer, constitutes a quorum. (6) A member entitled to vote at an election of members of the credit committee, if he votes, shall cast at the election a number of votes equa[ to, or less than, the number of members of the credit committee to be elected, and the member shall distribute the votes among the candidates in such manner as he sees fit, but no candidate shall receive more than one vote from each member. (7) Where a vacancy occurs in the credit committee, the Board may fill the vacancy until the next annual meeting of the credit union. 23 l No. 28 I Co-operative Societies Ac1 f 1999. (8) TI1e by~laws of the credit union may provide for the election and retirement of members of the Credit Committee in rotation so that no member of the credit committee shall be elected for a tenn of more than three years but no person may serve as a member of the Credit Committee of a society for more than two consecutive tenns or an aggregate of six successive years. Duties of credit committee.

57. The credit committee shall consider aJl applications for loans and may make recommendations to the Board in respect of the applications and petfonn such duties as are prescribed by this Act, the regulations and the by-laws of the credit union. Approval ofloans.

58. - (I) The Board may, upon such temts and conditions as it specifies, authorize the credit committee to approve loans to members. (2) The credit committee may upon such tenns and conditions as the Board specifies, authorize the treasurer, manager or other employees of the credit union to approve loans to members. (3) Any person authorized by the Board to approve Joans under subsection (I) or (_2) shall submit a written monthly report to the credit committee stating the number ofloan applications received, the number ofloans granted and the security, if any, obtained for such Joans. (4) The responsibilities and duties of any person authorized to approve loans under subsection .(1) are concurrent with the responsibiiities and duties of the credit committee. Credit committee reports.

59. -(1) The credit committee shall (a) meet at least once evezy month; (b) keep minutes of in; meetings; (c) submit a report to the Board stating (i) the number of loan applications received; (ii) the number and category ofloans granted; (iii) the security obtained for the loans granted; (iv) applications denied. and delinquent loans; and (d) submit an annual report on the matters referred to in paragraph (c) to "the annual meeting of the credit union. (2) The membem of a society may, by special resolution in a special meeting called for the purpose, remove a credit committee which fails to comply with paragraph (c) of subsection (1). 232 No, 28} Co-operative Societies Act { l 999, Remo\lal of member of credit committee.

60. - (I) The members may, by resolution passed by two-thirds of the votes cast at a general meeting called for the purpose, remove a member of the credit committee before the expiration of his term of office, and shafl at that meeting elect another member in place of the first mentioned mcm ber for the unexpired portion of his tenn. {2) The notice calling the meeting of members referred to in subsection (l) shall specifically state that the purpose of the meeting is to remove the member of the credit committee who is named in the notice. (3) The member of the cre.dit committee to be removed under this section has the right to make such representations to the meceting regarding the resolution for his removal as he thinks fit, and may be represented by an attomey-at-law or an agent. Removal of member of cred« commirtec hy I.lolU""d.

61. When a member of the credit committee fails to attend three consecutive meetings without, in the opinion of the Board, having reasonable cause or fails to perform any of the duties allotted to him a..~ a member of the committee, his position on the committee may be declared vacant by the Board which may then appoint a qualified person to fill the vacancy until the next annual meeting of the credit union. Supervi,,1r,v commi!te..,_

62. - (l) Every credit union shall have and where thought advisable a society may have a supervisory committee which shall be elected by its members at the annual general meeting. (2} The members of a .supervisory committee shall hold office for suc.h time as the by-laws provide and until their successors are elected, (3) The supervisory committee shall consist of the number of members fixed by the by-laws, which shall be not fewer than three, (4) No person who is a memberof the board. or credit committee or who is an employee of the credit union or other society shall be a member of the supervisory committee. (5) A majority of the supervisory committee constitutes a quorum. {6) A member entitled to vote at an election of members of the supervisory committee ifhe votes, shall cast a number of votes equal to or less than the number of the members of the supervisory committee to be elected, and the member shall distribute the votes among the candidates in such manner as he sees fit, but no candidate shall receive more than one vote from each member. 233 No. 28] Co-operative Societies Act { 1999. (7) Where a vacancy occurs in the supervisory committee, the supervisory committee may fill the vacancy until the next annual meeting of the credit union or society. (8) The by-laws of the credit union or other society may provide for the election and retirement of members of the supervisory committee in rotation, but in that case no member shall be elected for a term of more than three years, and no person m.ay serve as a member of the Supervisory Committee of a society for more than two consecutive terms or an aggregate of six suc.cessive years. Duties Qf supervisory committee.

63. The supervisoty committee shall examine the books ofthe credit union or other society, confinn the cash instruments, property and securities of the credit union or other society and confinn the deposits of the members and peifonn such other duties as are prescribed by this Act, the regulations and the by-laws of the credit union or other society. Removal of member of supervisory committee.

64. When a member of the supervisory committee fails to attend three consecutive meetings of the committee without, in the opinion of the supervisory committee, having a reasonable auise therefor, or fails to perfonn any of the duties allotted to him as a member of the committee, his position on the committee may be declared vacant by the remaining member5 of the committee who may appoint a qualified penion to fill the vacancy until the next annual meeting of the credit union or other society. C\erka. . 65. The Board may appoint such persons as it considers necessary to assist the supervisoty committee in its duties, and pay those persons such remuneration as it thinks fit. Misapproprir.tio11 etc.

66. - ( 1) When the supervisocy committee is of the opinion that the funds, securities or other property of the credit union or other society have been misappropriated or misdirected, or in the event that the by-laws of the credit union, or other society, this Act or the Regulations have been contravened by the Board, the credit committee or a member of the credit committee or an officer or employee engaged by the Board the supervisory committee shall forthwith infunn the Registrar in writing. (2) The Supervisory Committee shall in consultation with the Board appoint an auditor or some other body to assist in detennining whether any of the funds, securities or other propeny of the credit union or other society have been misappropriated or misdirected and the remuneration of any auditor or other body so appointed shall be determined by· the supervisory committee and paid by the credit union or other society. 234 No. 28] Co-operative ,",'ocieties Act 11999. (3) In the event of a misappropriation or misdirection or a suspected misappropriation or suspected misdirection as referred to in subsection ( l ), the supervisory committee may suspend any member of the Board. (4) The Supervisory Committee shall forthwith request the Board to summon a general meeting of the members to be held within fourteen days after the suspension referred to in subsection (3); and where the Board fails to summon such a meeting the supervisory committee shall summon the meeting within seven days after the expiry of the period of fourteen days. (5) The supervisory committee shall report to the general meeting all the circumstances of any misappropriation or misdirection of funds, securities or other property and the reasons for any suspension. (6) The members of the credit union or other society may, by resolution, dismiss from office any person suspended under subsection (3), and, when the members of the credit union or other society do not dismiss from office a person so suspended, that person shall be reinstated forthwith. Meetings. 67. ~ ( l) The supervisory committee shall meet at least once every month, and shall at each such meeting examine the affairs of the credit union or other society. (2) The supervisory committee shall keep minutes of its meetings and shall, (a) within seven days of each meeting report the results of the' meeting in \vriting to the Board; and (b) submit a written report to the annual meeting of the members. of the credit union or other society. Removal of members of supervisory committee. 68. ~ (1) The members may, by resolution passed by two-thirds of the votes cast at a general meeting duly called for that purpose, remove a member of the supervisory committee before the expiration of his tenn of office, and shall by votes cast at the meeting elect another member in his stead for the unexpired portion of his tenn. (2) The notice calling the meeting of members referred to in subsection ( 1) shall state that the purpose of the meeting is to remove the member of the supervisory committee who is named in the notice. 235 No.28 I Co--operatfve Societie.~· Act [ 1999. (3) The member of the supervisory committee removed under this section has. the right to make representations to the members regardjng the resolution for his removal as he thinks fit, and may be represented by an attomey-aUaw or an agent. _ Election of' di1ec1m,,

69. - ( l) Subject to section 70 and subject to the regulations and the by-laws _ - (a) the election of directors must take place annually at the annua1 general meeting~ (b) the directors hold office until the conclusion of the meeting at which their successors are elected, and are eligible for re-election~ . . _ (c) where the number of nominees exceeds the number of directors to be elected, the election of directors must be by secret ballot; (d) every member has the right to vote for the number of directors to be elected and any ballot that contains the names of more than the number to be elected is void; _ _ (e) wh~re there are vacancies on the Board but the reinaining directors constitute a quorum, the Board .maY appoint a member to fiU any such vacancy; · ,· (I) where there is a vacancy on the Board and there is not a quorum of directors, the remaining directors shaJJ tall a special generaJ meeting for the purpose of electing members to fill any vacancy. (2) Where an election of directors required by this Act;the regulations or the by-laws does not take place at the proper time, the directors then in office shall continue in office until their successors are elected. · ·- · (3) Subject to the by-laws of a society, not the directors may be employees of a society. more than on~-thi~ of (4) Unless a reasonable excuse is receive4 -by the meeting, .no person may be elected a director if he is not present at _the meetiqg at which the election is being conducted, Tenure or directon. . .

70. - ( l) Subject to subsection (2) the directors of a society shall be elected for a term of three years, but no person may serve as a director of a society for more than two consecutive termF or an aggregate of six y~ __ , . (2) A director who has served as a director for two ·consecutive tenns or for an aggregate period of six years as a director and is therefore not qualified to hold office under subsection ( 1), is eligible for re-election as a director at the expiration of one year after leaving office as director. · 236 No. 28] Cowoperative 5,ocieties Act I_ 1999. ,··. (3) After the commencement of this Act, the Boards of all societies shall resign at their next annual general •meeting and new· Boards shall be elected on a rotational basis as follows : · · (a) at least one-third of the directors to serve for I year, . (b} ,.rt least one-third of the direct9rs to serve for 2 years, (c) the remainder of the directors to serve for 3 years, thereafter, each elected director shall serve for a tenn of three years. Borrowing powers of Board.

71. - (1) Subject to the by-laws, the Board may without authorization of the members of a society (a) borrow money on the credit of the society; (b) issue, re-issue, sell or pledge debt obligations of the society; . (c) give:aguarantee on behalf of the society to secure perfom1ance of an obligation of any person; and (d) mortgag~, charge, h.y\)othecat.e, 9ledge or otherwise create a security interest in all or any property of the society, owned or subsequently acquired, to secure any debt obligation of the society. _ · .(2) A sale, lease or exchange of all or substantially all of the property ofa society, other than in the ordinary course of business ofthe society, must be approved by the members in a manner provided in subsection (3) to (7). _ (3) The directors shall send, in the manner provided in section 43, a notice of a special meeting to consider the sale, lease or exchange mentioned in subsection (2) to each member. (4) The notice mentioned in subsection (3) must include or must be acco~panied .by a copy or summary of the agreement of sale, lease or ex<,:hangementiontd in subsection (2). (5) At a.special meeting held pursuant to this section, the members may; by special resolution ~ · · · - (a) authorize the sale, lease or exchange mentioned in subsection ... ·' (2), and . . ·. - . . . (b)..fix _or authoriz~ the directors to fix, any tenns and conditions .· -• - ,o(s.a!-e,Jease or..exchange. · {6)_EacµJt1ember of the society has the right to vote with respect to sale, lease or exchange mentioned in subsection (2). 237 No. 28] C'o-operative ,",'ocieiics Act I t999. (7) A sale. lease or exchange mentioned in subsection (2) is adopted when the mem hers of the society have approved the sale, lease or exchange by a special resolution Validity of acts of directors, and oflfoers.

72. The act of a director or officc.r is valid notwithstanding an irregularity in his election or a defect in his appointment or qualification. Jndemnificalion of directors.

73. - (I) Subject to subsections (2) and (3), a society may indemnif), - (a) a director or officer of the society; (b) a fonner director or officer of the society; (c) a person who acts or has acted at the request of the society as a director or officer of a body corporate of which the society is or \\'as a member or a creditor. against costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by that person with respect to a civil, criminal or administrative action or proceeding to which that person is made a party by reason of his being or having been a director or officer of the society or body corporate. (2) A society may indemnify a director, officer, or other person only where that person (a) acted honestl:,., and in good faith with a view to the best interest of the society: (b) in the case of a criminal, civil or administrative action or proceeding that is enforced by a monetary penalty, had reasonable grounds for believing that the conduct was lawful. (3) No society shall indemnif'.y a director, officer or other person mentioned in subsection ( l) with respect to an action by or on behalf of the society to obtain a judgment in its favour to which that person is made a party by reason of his being or having been a director or an officer of the society, against costs, charges and expenses reasonably incurred by that person in connection with the action unless (a) the society has the approval of the court; and (b) that person fulfills the conditions prescribed in subsection (2). 238 No. 28 l Co-operative S.oci(!lies Ac·t I l999. (4) Notwithstandi_ng subsections O) to (3), a s9ciety shall -indemnify a director. officer or other person mentioned in subsection (I) who has been successful in the defence of a civil, -criminal or administrative action or proceeding to which that person is made a party by reason of his being or having been a director or officer of the society or body corporate against costs, charges and expenses reasonably incurred by that person with respect to the action or proceedings, (5) A society or a director. officer or other person mentioned in subsection (I). may apply to the court for an order approving the indemnity and the court may make the order. • (6) On an application pursuant to subsection (5) the court may order notice to be given to an interested person, and that interested person is entitled to appear and be heard in person or by an attomcy-at- law. Duty of olll'e of direl;tors and officers.

74. Every director and officer of a society in exercising his powers and discharging his duties shall · (a) act honestly and in good faith with a view to the best interests of the society; and (b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. Ambit of director's duty.

75. The provisions of a contract, the by-laws or the circumstances of his appointment do not relieve a director from (a) the duty to act in accordance with this Act and the regulations~ and (b) liability that by virtue of a rule oflaw would othetwise attach to him with respect to negligence, default, breach of duty or breach of trust of which he may be guilty in relation to the society. Liability of directors.

76. - (1) Where directors vote for, consent to a resolution authorizing, or approve by any other means (a) the purchase of shares of another society -contrary to section 94; (b) the payment of a dividend oo shares contrary to section 123~ (c) the payment of a bonus contrary to section 123; 239 No. 28 \ ( 'o-operativc ,",'ocieties Act ( 1999. (d) a loan or guarantee or the giving of financial assistance contrary to section l 15: (e) a payment of an indemnity described in section 73 to a director or a fonncr director, without the approval of the court required by subsection (3) of that section; or (t) an act not consistent with the purpose of the society as set out in its by-laM and with respect to which the society has paid compensation to a person; they are jointly and severally liable to make good any loss or damage suffered by the society. (2) On the application of a director, the court may declare whether or not, having regard to any of the circumstances the court considers appropriate, (a) the society is insolvent; or (b) the payment of a bonus or dividend or the lending of money would make the society insolvent. (3) The liability imposed by subsection (I) is in addition to and not in derogation from a liability imposed on a director by any other enactment or law. (4) For the purpose of this section, a director who is present at a meeting of directors or of a committee is deemed to have cast an affinnative vote, given consent to a resolution or given the approval mentioned in subsection (l), unle:ss, (a) the director's dissent is entered in the minutes of the meeting; or (b) the director's written dissent is (i) delivered to the secretary of the meeting before its adjournment, or (ii) delivered or sent by registered mail to the registered office of the society immediately after the adjournment of the meeting. (5) A director who votes for a resolution mentioned in subsection { i} is not entitled to dissent under subsection (4). (6) Where a director is not present at a meeting of directors or of a committee at which a vote, resolution or approval mentioned in subsection (I) is cast or given, he is deemed to have eati't an affirmative vote, consented to the resolution or given approval, unless, within fourteen days after becoming aware of the proceedings; the director delivers or sends by registered mail his written dissent to the registered office of the society. 240 No. 28 j Co-operative Societies Act [ 1999. (7) On receipt of a written dissent, the secretary of the society shall -- (a) certify on the wiitten dissent the date, time and place it is received. and (b) keep the written dissent in the minutes of the meeting at which the resolution was passed. (8) No action to enforce a liability imposed in subsection (I) is to• be commenced after two years from the date of the meeting at which the vote, resolution or approval was taken or given. (9) In.an action to enforce a liability imposed in subsection (I), the Court may, on the application of the society or a defendant, (a) join as a defendant a person \Vho received a benefit as a result of the resolution complained of: and (b) make the person mentioned in paragraph (a) liable to the society jointly and severally with the directors to the extent of the amount paid to him. ( 10) A director is not liable under subsection ( l) where he (a) proves that he did not know or could not reasonably have known that tl1e act authorized by the resolution was contrary to this Act; (b) relies and acts in good faith (i) on statements of facts represented to him by an officer of the society to be correct, or (ii) on statements contained in a written report or opinion of the auditor of the society or a professional person engaged by the society who is competent to give advice· in respect of the matter. ( 11) A director who is found liable pursuant to subsection ( l) is- entitled to apply to a court for an order compelling a member or other recipient to pay or deliver to the director any money or property that was paid or distributed to the member, or other recipient contrary to section 94, 115 or 123. (12) In connection with an application pursuant to subsection (l l} is and where the court satisfied that it is equitable to do so, it may - (a) order a member or other recipient to pay or deliver to a director any money or property that was paid or distributed to the member or other recipient contrary to section 94, 115 or 123; or 241 No. 28 J Co-operative Societies Act [ 1999. (b) make an order, other than that described in paragraph (a), that it considers appropriate. Misuse of confidential information.

77. A director or an officer, or an associate of a director or an officer, who, in connection with a transaction relating to shares of a society or a debt obligation of a society, makes use of confidential information for the benefit or advantage of himself or an associate that, if generally known, might reasonably be expected to affect materially the value of the share or the debt obligation (a) is liable to compensate any person for a direct loss suffered by the person as a result of the transaction, unless the infonnation was known or reasonably should have been known to the person at the time of the transaction; and (h) is accountable to the society for any direct benefit or advantage received or receivable to him or his associate, as the case may be, as a result of the transaction. Materia 1 contracts.

78. - ( l) Subject to subsection ( I 0), a director or officer of a society who (a) is a party to a material contract or proposed material contract with the society, or (b) is a director or officer of, or has a material interest in, a person who is party to a material contract or proposed material contract with the society, shall disclose in writing to the society, or request to have entered in the minutes of meetings of directors, the nature and extent of his interest. (2) The disclosure required by subsection (l) must be made in the case of a director (a) at the meeting at which a proposed contract is first considered: (b) if the director was not then interested in the proposed contract at the first meeting after he becomes so interested: (c) if the director becomes interested after a contract is made. at the first meeting after he becomes so interested: or (d) if a person who is so interested in a contract become::; a director, at the first meeting after he becomes a dircct(1r 242 No. 28 j Co-operative Societies Act I 1999. (3) A disclosure required by subsection (1) must be made in the case of an officer who is not a director (a) immediately after he becomes aware that the contract or proposed contract is to be cousidcrcd or has been considered at a meeting of the Board; (b) if the officer becomes interested after a contract is made, immediately after he becomes so interested; or (c) where he has an interest in a contract before becoming an officer, immediately after he becomes an officec (4) If a material contract or proposed material contract is one that in the ordinaz}' course of the society's business would not require approval by the directors or members, a director or officer shaII disclose in writing to the society or request to have entered in the minutes of meetings of the Board the nature and extent of his interest after he becomes aware of the contract or proposed contract. (5) A director referred to in subsection ( l) may take part in discussions to consider, or vote on a resolution to approve a contract that he has an interest in, if the contract (a) is an arrangement by way of security for money lent by him to the society or obligations undertaken by him for the benefit of the society or a member of the society: (b) is a contract that relates principally to his remuneration as a director, officer, employee or agent of the society or a member of the society; (c) is a contract for indemnity or insurance pursuant to section 73. (6) Where a director is not entitled to vote at a meeting pursuant to subsection (5) and his presence is required to constitute a quorum at a meeting of directors, a decision of the directors is deemed not to be invalid only by reason of the absence of the director. (7) For the purposes of this section. a general notice to the dfrccto.rs by a director or officer declaring that he is to be regarded as interested in any contract made with that person is a sufficient declaration of interest in relation to any contract made with that person. (8) Where (a) a director or officer discloses his interest in accordance with this section, and 243 No. 28 j Co"operative Sociertes Act I 1999. (6) the contract in which the director or officer has a material interest (i) is approved by the directors or members, and (ii) is reasonable and fair to the societv at the time it was approved, · the material contract is neither void nor voidable by reason only of that relationship or by reason only that a -director with an interest in the contract is present at or is counted to detennine the presence of a quorum at a meeting of the Board or committee that authorized the contract. (9) Where a director or officer of a society fails to disclose his interest in a material contract in accordance witb this section a court may, on the application of a society or a member of the society, set aside the contract on any terms that the court considers appropriate. ( l 0) This section does not require the disclosure of an interest in a contract or transaction that is of a type available to and customarily entered into betv,een the society and its members. lvleetings of directors generally.

79. - (I) Sub_ject to the by-laws, the directors may meet at any place, and on any notice that they consider appropriate. (2) The president (a) may caH a meeting of directors at any time; and (b) on the written request of at least two directors, shall call a meeting within fourteen days of the receipt of the request. (3) A majority of the- directors constitute a quorum at any meeting of directors. (4) Subject to the by-laws, a notice of a meeting of di rectors need not specify the purpose of or other business to be transacted at the meeting. (5) A director may in any manner waive a notice of a meeting of directors. (6) For the purpose of subsection (5), attendance of a director at a meeting of directors is deemed to be a waiver of notice for the meeting, unless the director attends the meeting for tlu. express purpose· of ob_jecting to the transaction of any business ori the ground that the meeting is not lawfully called. (7) Where the time and place of an adjourned meeting is announced at the original meeting, notice of an adjourned meeting of directors is not required to be given. 244 No. 28] Co-operative Societies Act I 1999. Meetings by 1elephone etc.

80. - ( l) Subject to the by-laws, where all the directors consent, a meeting of directors or of a committee may be held by means of - (a) a telephone system; or (b) a communication facility other than a telephone, that permits all persons participating in the meeting to hear and speak to each other, and a person so participating is deemed to be present at that meeting. (2) Unless this Act, the regulations or the by-laws require (J meeting, a resolution of the directors may be passed without a meeting where- (a) all the directors consent to the resolution in writing; and (b) the consent is filed with the minutes of the proceedings of the directors. Attendance 11.t meetings.

81.-(1) A director ofa society is entitled to receive notice of and to attend and be heard at every general meeting of members. (2) Where a director (a) resigns, (b) receives a notice or otherwise learns of a meeting of members called for the purpose of removing him from office, or (c) receives a notice or otlJerwiseleams ofa meeting of dfrectors or members at which another person is to be appointed or elected to fill his office, whether because of his resignation or removal or because his term of office has expired or is about to expire, he is entitled tQ submit t.o the society a written statement giving the reason for his resignation or the reasons why he opposes any proposed action or resolution. (3) A society shall immediately send a copy of the statement mentioned in subsection (2) to the Registrar and shall make available a copy of the statement to every member. (4) No society or person acting on its behalf incurs any liability by reason only of circulating a director's statement sent in compliance with subsection (3). Inaugural meeting of directors.

82.- (l) Subject to subsection (5), the directors shall hold a meeting within ten working days after the issue of the society's certificate of registration. 245 No. 28] Co--operative Societies Act I I999. (2) Tue directors may, at the meeting mentioned in subsection (I) (a) pas:, resolutions establishing policies of the society; (b) adopt forms of corporate records~ (c) appoint officers; (d) authorize the issue of securities: (e) appoint an auditor to hold office until the first general meeting of the members; (/) make banking or other financial arrangements; (g) appoint authorized signing officers; (h) adopt operating policies; and (i) transact any other business. (3) A director may call the meetiug of directors mentioned in subsection (l) by giving not less than five days' notice of the meeting to each director, stating the time and place of the meeting. (4) The notice mentioned in subsection (3) may be waived where a11 directors are in attendance at that meeting of directors. (5) This section does not apply to a society that is deemed to have been registered under this Act. Director ceasing to ho !d office. 83.~ (l) A director ceases to hold office when he: (a) dies or resigns, (b) is removed in accordance with section 84, or (c) is no longer qualified in accordance with this Act. (2) A resignation of a director becomes effective on (a) the date when the resignation was received; or (b) the date specified in the resignation. Removal of directors.

84. - ( l) Subject to the regulations and by-laws, the mem hers of a society may, by special resolution, remove any director from office. (2) A vacancy created by the removal of a director may be filled at the meeting of the members at which the director is removed or where not so filled, may be filled pursuant to section 69 (1) (e). Notice of change in director.s.

85. - ( 1) Within thirty days after a change is made in its directors, a society shall send to the Registrar a notice in the prescribed fonn setting out the change and the Registrar shall file the notice. 246 No. 28} Co~operative S<>cieJies Act ( 1999. (2) Notwithstanding subsection (0. where a society sends the annual return in accordance with section l41, within thirty days after a change is made in its directors, it is not required to send the notice rellUJred by this section. Decl11rali'>n by Directon, and officers.

86. A society may by resolution passed by a majority of the members at an annual or special meeting require all directors and offieen; to sign annually or at any other time that may be specified in the resolution a declaration relating t.o (a) faithful performance of duties; (6) secrecy of transactions with members; and (c) faithful and loyal support of the society. &nding.

81. The directors may .require that evexy person appointed to an office who receives; manages or handles goods or merchandise or manages or handles the expenditure of money on behalf of the society sball give to the directors, before entering on his. duties as an officer, securlty or a bond in. the prescribed amount. Ju.u,ww-.ation of ~ o n ; .

88.-(l)No director and no member of a committee is entitled to be paid any remuneration in connection with his duties as a director or committee member on beha1f of a society or his attendance at meetings. (2) Directors and membezs of committees may be reirnburned for expenses incuned by reason of the performance of their duties and functions as directc:,rs or members of committees. (3) A society may purchase and maintain insurance fortbe benefit of a director, member of a committee, officer or employee against a liabilii)', loss and damage incuaed by that person while on aduty of the society or on a mission directly related to his duties as; a director, mem- ber of committee, officer or employee. ~ o n of Dft'il:Cff and employaes,

89. Subjett to section 88 and the by-laws, the directors shall fix the salazy of any officers appointed by them and shall approve a scale of remuneration for any employees ~fa s.ociety. PARTV FJNANCING Shares, 90, - (1) A societf may sell shares to its members only, but the snares m.ust have par value fixed by the by-laws. 247 No. 281 Co-operative Societies Act I 1999. (2) Unless a society is required by this Act or any other enactment to limit its number of shares it shall have an unlimited number of shares. (3) A share in a registered society is personal property and a sl1areh0Jder is entitled to an annual statement showing the number of shares that he owns. Shart capital.

91. - A society shaU express its share capita.I in its by-laws as (a) an amount of money divided into a specified number of shares set out in the by-laws~ or · (h) an amount comprising an unlimited number of shares with a specified par value. Issue of Shltfes.

92. - (l) Subject to subsection (2). a society may issue shares at any time and for any consideration that tile directors consider appropriate. (2) Subject to the by-laws. a society shall sell its shares at their par value. (3) No member is liable to a society or its creditors beyond the fully paid shares and the sum remaining unpaid on the member's subscription for shares. (4) No society shall issue a share until it is fully paid (a) in money; or (b) in property that, in the opinion of the directors, is the fair equivalent ofthe money that the society would have received if the share had been issued for money. (5) For the purposes of subsection (4) (b), when detennining whether property is the fair equivalent of a money consideration, the directors may take into account reasonable charges and expenses of organization and reorganization and payment for property reasonably expected to benefit the society. (6) For the purposes of this section "property" does not include a promissory note or a promise to pay. Alteration of authorized capital.

93. - ( l) A society may, by special res0Jut.i9n, amend its by-Jaws to increase or decrease its capital and, for that putpose, may · (a) subdivide any shares; · (b1 consolidate shares jnto shares of a larger par value, but the par value of consolidated shares must not be greater than one hundred dollars; 248 No. 28 I Co-operative Societies Act 11999. (c) cancel any shares that at the date of registration of the by-laws, have not been subscribed for or agreed to be issued and diminish the amount of its capital by the amount of the par value of the shares so cancelled.; (d) extinguish or reduce the liability on any of its shares with re.spect to capital not paid up; - (e) with or without e.),.1.inguishing or reducing liability on any of its shares, cancel any pai.d up capital that is lost or unrepresented by available assets; and (t) with or without extinguishing or reducing liability on any of its shares and either with or without reducing the number of such shares, pay off any paid-up capital that is greater than the requirements of the society. (2} The Registrar may approve a by-law mentioned in subsection ( l) where he is satisfied that (a} the by-law has been made in accordance with this Act; (b) the holders of all shares of the society affected by the by-law have approved the by-law by a special resolution passed by the members at a general meeting called for the purpose; and (c) in the case of a by-Jaw providjng for a reduction in the capital of the society (i) aH creditors who are liable to be affected have been notified of the by-law and have signified their approval~ or (ii) appropriate steps have been taken by the society to· adequately safeguard the interest of its creditors. Limitation on purchase of sharet..

94. - Subject to the approval of the Registrar, only a registered society may purchase more than one-fifth of the shares of another society where (a) the other society is insolvent; (b) the proposed purchase or acquisition would not render the purchasing society insolvent; or (c) the proposed purchase or acquisition would not, in the opinion of the Board, be detrimental to the financial stability of the society. 249 No. 28 J Co-operative Societies Acl [ 1999. Trllllsfer of shares _generally,

95. - (l) A share may be transferred with the approval of the Board to any other member at the option of the transferor, but if the transferee is not a member, he must be approved as a member by the Board, or the general meeting according to the by-laws relating t.o the admission of members before the transfer can be registered; and if the by-laws require a member to hold more than one share, the transferee must acquire by the transfer, or by the transfer and allotment, the number so required to be held before the transfer can be registered. (2) A transfer of shares shall be effected in such form as the Registrar .determines. (3) No transfer of a share shall be valid and effective unless and until such transfer has been registered by the Secretary on the direction of the Board. ( 4) No transfer of a share shall be registered nor shall any claim of the society upon the transferor be affected if made by a member indebted to the registered society ,vithout the written permission of the Board, and until the transfer of a share is registered by the transferee. Transfer of shares of member of unsound mittd. 96. ~ ( 1) Where a member or person claiming through a registered society has become of unsound mind or is incapable of managing his affairs and no committee, receiver or guardian has been appointed, the society may subject to this section and section 95 transfer the share or jnterest of such member to any person nominated by such member for the purposes of section l 00 or may pay to the peISon nominated a sum representing the value of the share or interest of such member ascertained in accordance with subsection (5). (2) Subject to subsection (3 ). if no nominee has been appointed, the society may pay a sum representing the value of the member's share or interest to the Registrar of the Supreme Court. (3) lftbe value of the share or interest does not exceed one hundred dollars the Board may, subject to any conditions it thinks fit. pay the whole or any portion of such sum to the person who appears to have the care of such member or the management of his affairs. (4) All transfers and payments made by a registered society in accordance with this section shall be valid and effective against any demand made upon the society by any person. 250 No. 28] Co-operative Societies Act / 1999. (5) For the purposes of this section and section 94, the value of any share or interest shall be represented by the sum actually paid for that share or interest by the member holding it unless the by-laws of the society otherwise provide; and where the benefits of group insurance have accrued on such share or interest, the value of such benefits shall be the amount actually received by the society on the account of such deceased member. Transfer of share~ ur interest on deatl1 af memhcr.

91. - (I) Where a person has been nominated as beneficiary by a. member in accordance with the by-laws of a society and such nominee is admitted to membership in the society, the society shall within one year ofthc death of the member by whom the nomination wa'> made, transfer the shares or interest of sud1 deceased member to the limit specified in subsection (2) to the nominee. (2) Where no such nominee is admitted to membership in the society or where the deceased member made no such nomination the society shall within one year of the death of such deceased member pay to the nominee or legal personal representative of the deceased member as the case may be, such sum, not exceeding the said limit, representing the value or part thereof of the deceased member's share or interest in the society. (3) Nothing in this section shall be construed as prohibiting a nominee who has been anmitted to membership from electing to receiH: payment representing the value of the deceased member's shares or interest instead of accepting a transfer. Restriction an transfer of shares.

98. - ( l) Subject to this section, the transfer of the shares or interest of amernber or deceased member in the capital of a society shall be subject to such conditions as may be prescribed by or under this Act. (2) No shares or interest or any part thereof in the capital of a society may be transferred unless the transfer is made to a member of the society or to a person whose application for membership has been accepted. Conditions for transfor of ~hare&.

99. - (l) Subject to the by-laws, no transfer of shares in a society is valid for any purpose unless (a) a written application for membership by the transferee is approved and the transfer is authorized by (i) a resolution of the directors; or (ii) a person authorized by a resolution of the directors to approve applications and transfers of that kind, and