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17 1989

BUILDING SOCIETIES ACT, 1989

PART XII

Winding up, etc.

Winding up.

109. —(1) Subject to this section, a building society may be wound up in accordance with the Companies Acts and accordingly those Acts shall, subject to any necessary modifications, apply as if the society were a company limited by shares.

(2) In the application of the Companies Acts to the winding up of a society—

(a) a reference to “the registrar of companies” in the Act of 1963 shall be construed as a reference to the Central Bank,

(b) a reference to “the articles of association” in the Act of 1963 shall be construed as a reference to the rules of a society,

(c) a reference to “a special resolution” in the Act of 1963 shall be construed as a reference to a special resolution of a society within the meaning of this Act, and

(d) “secretary” in section 224 of the Act of 1963 shall be construed as the chief executive of a society.

(3) A society may be wound up by the Court if—

(a) the society has by special resolution resolved that the society be wound up by the Court,

(b) the number of members is reduced below 10 or the number of directors below 3,

(c) the society, being a society registered as a building society under this Act or the repealed enactments, has not been granted an authorisation and more than one year has expired since it was so registered,

(d) the society is unable to pay its debts,

(e) the society has had its authorisation revoked under section 40 , or

(f) the Court is of opinion that it is just and equitable that the society should be wound up.

(4) (a) A petition for the winding up of a society may, notwithstanding anything in section 215 of the Act of 1963, be presented by the Central Bank.

(b) Sections 213 and 215 (a) and (d) and 296 of the Act of 1963 shall not apply to the winding up of a society.

(5) Notwithstanding anything in sections 217, 234, 256, 280 and 298 of the Act of 1963, an application to the Court under any of those sections may be made by the Central Bank.

(6) The winding up of a society shall not bar the right of the Central Bank to have it wound up by the Court.

(7) Notice of any resolution or application for the winding up of a society shall be given to the Central Bank.

(8) Part X of the Act of 1963 shall not apply to a society and, notwithstanding anything in that or any other Act, a society may not be wound up except in accordance with this section.

(9) Where a society is being wound up, a person to whom a loan has been made by the society under a mortgage or other security shall not be liable to pay the amount payable in respect of the loan except at the time or times and subject (as may be appropriate) to the conditions set out in the mortgage or other security.

(10) The liquidator in the exercise of his powers under section 231 (2) (a) of the Act of 1963 shall not dispose of any of the society's assests secured by mortgage of freehold or leasehold estate or interest on terms as respects the loans other than terms which the Court is satisfied are just and equitable and which the borrowers would have been reasonably entitled to expect if the society had not been wound up.

(11) The Central Bank may appoint one or more officers of the Bank or other representatives who shall be entitled to—

(a) attend any meeting of creditors of a society, and

(b) be a member of any committee of inspection appointed under section 233 or 268 of the Act of 1963.

(12) An officer or representative of the Central Bank appointed to be a member of a committee of inspection shall not be removed from office without the consent of the Bank and shall not be counted in computing any minimum or maximum number of members of such committee specified in any enactment.

(13) Where the winding up of a society commences within one year after the society has changed its name, the former name as well as the existing name shall appear on all notices and advertisements relating to the winding up.

Cancellation of registration.

110. —(1) The Central Bank shall cancel the registration of a building society that has been—

(a) dissolved by virtue of section 95 or 96 ,

(b) wound up under section 109 and dissolved, or

(c) converted into a public limited company under Part XI .

(2) Where the Central Bank is satisfied, with respect to a society—

(a) that a certificate of incorporation has been obtained for the society by fraud or mistake and that the society is not an authorised society,

(b) that the society has ceased to function, or

(c) that the society has failed to comply with section 124 (5),

the Bank may cancel the registration of the society.

(3) Without prejudice to subsection (2), the Central Bank may, if it thinks fit, cancel the registration of a society at the society's request, evidenced in such manner as the Bank may direct.

(4) Before cancelling the registration of a society under subsection (2), the Central Bank shall give to the society not less than 2 months' notice, specifying the grounds of the proposed cancellation.

(5) Where the registration of a society is cancelled under subsection (2), the society may within 1 month appeal to the Court and on any such appeal the Court may, if it thinks proper, set aside the cancellation.

(6) Where the registration of a society is cancelled under subsection (2) or (3), then, subject to the right of appeal conferred by subsection (5), the society shall cease to be a building society within the meaning of this Act.

(7) Subsection (6) shall have effect in relation to a society without prejudice to any liability actually incurred by the society and any such liability may be enforced against the society as if the cancellation had not taken place.

(8) As soon as practicable after the cancellation of the registration of a society under this section, the Central Bank shall cause notice thereof to be published in at least 2 daily newspapers published in the State and circulating in the area in which the chief office of the society is situated.

Liability of officers of society to penalty where proper accounting records not kept.

111. —(1) If—

(a) a society that is being wound up and that is unable to pay all of its debts has contravened section 76 , and

(b) the Court considers that such contravention has contributed to the society's inability to pay all of its debts or has resulted in substantial uncertainty as to the assets and liabilities of the society or has substantially impeded the orderly winding up thereof,

every officer of the society who is in default shall be guilty of an offence.

(2) In a prosecution for an offence under this section it shall be a defence for the person charged to show that—

(a) he took all reasonable steps to secure compliance by the society with section 76 , or

(b) he had reasonable grounds for believing and did believe that a competent and reliable person, acting under the supervision or control of a director of the society who has been formally allocated such responsibility, was charged with the duty of ensuring that that section was complied with and was in a position to discharge that duty.

Personal liability of officers of society where proper accounting records not kept.

112. —(1) Subject to subsection (2), if a society that is being wound up and that is unable to pay all of its debts has contravened section 76 , and the Court considers that such contravention has contributed to the society's inability to pay all of its debts or has resulted in substantial uncertainty as to the assets and liabilities of the society or has substantially impeded its orderly winding up the Court, on the application of the liquidator or the Central Bank or any creditor or contributory of the society may, if it thinks it proper to do so, declare that any one or more of the officers and former officers of the society who is or are in default shall be personally liable, without any limitation of liability, for all, or such part as may be specified by the Court, of the debts and other liabilities of the society.

(2) On the hearing of an application under subsection (1), the person bringing the application may himself give evidence or call witnesses.

(3) (a) Where the Court makes a declaration under subsection (1), it may give such directions as it thinks proper for the purpose of giving effect to the declaration and in particular may make provision for making the liability of any such person under the declaration a charge on any debt or obligation due from the society to him, or on any mortgage or any interest in any mortgage on any assets of the society held by or vested in him or any company or other person on his behalf, or any person claiming as assignee from or through the person liable under the declaration or any company or person acting on his behalf, and may from time to time make such further order as may be necessary for the purpose of enforcing any charge imposed under this subsection.

(b) In paragraph (a)assignee” includes any person to whom or in whose favour, by the directions of the person liable, the debt, obligation or mortgage was created, issued or transferred or the interest created, but does not include an assignee for valuable consideration (not including consideration by way of marriage) given in good faith and without notice of any of the matters on the ground of which the declaration is made.

(4) The Court shall not make a declaration under subsection (1) in respect of a person if it considers that—

(a) he took all reasonable steps to secure compliance by the society with section 76 , or

(b) he had reasonable grounds for believing and did believe that a competent and reliable person, acting under the supervision or control of a director who has been formally allocated such responsibility, was charged with the duty of ensuring that this section was complied with and was in a position to discharge that duty.

(5) This section shall have effect notwithstanding that the person concerned may be criminally liable in respect of the matters on the ground of which the declaration is to be made.

(6) In this section “officer”, in relation to a society, includes a person who has been convicted of an offence under section 90 or 120 in relation to a statement concerning the keeping of proper accounting records by the society.