Acts and Regulations

84-137 - Debentures

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Current to 1 January 2024
NEW BRUNSWICK
REGULATION 84-137
under the
Standard Forms of Conveyances Act
(O.C. 84-484)
Filed June 20, 1984
Under section 2 of the Standard Forms of Conveyances Act, the Lieutenant-Governor in Council makes the following Regulation:
1This Regulation may be cited as the Debentures Regulation - Standard Forms of Conveyances Act.
2This Regulation does not apply to conveyances of land by deed, quit claim deed, transfer, easement, right-of-way, licence, option, right of first refusal, agreement for the sale or purchase of land, boundary line agreement, party wall agreement, expropriation, Crown grant, lease, renewal of lease, surrender of lease, mortgage, collateral mortgage, postponement of mortgage, postponement of debenture, trust deed or other instrument to secure bonds or debenture stock of a corporation, discharge of mortgage, discharge of debenture, partial discharge of mortgage, partial discharge of debenture, assignment of mortgage, assignment of debenture, notice of crystallization, assignment of lease, agreement amending a registered instrument, Order in Council, Act of the Parliament of Canada or Act of a Provincial Legislature.
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3(1)Subject to subsection (2), a debenture which contains a mortgage or other charge of land shall be in the appropriate form set out in Schedule A and the heading is part of the form.
3(2)A debenture which does not contain a charge of land registered under the Land Titles Act shall not be registered under that Act.
3(3)Directions printed in italics are not part of a form.
3(4)Words and directions which are underscored are not part of a form and are inserted for guidance.
3(5)Parts of a form that are enclosed in parentheses are optional.
3(6)The forms set out in Schedule A may be modified as required to provide for execution by more than one person.
3(7)Information required to be included in a form set out in Schedule A may be attached as a schedule thereto.
4When used in a debenture, words that are set out in Column One of Schedule B and distinguished by a letter therein have the same effect as if the words set out in Column Two of Schedule B and distinguished by the same letter were used in the debenture.
4.1(1)When words which are other parts of speech or tenses of words set out in Column One of Schedule B and distinguished by a letter therein are used in a debenture, those words which are other parts of speech or tenses
(a) have meanings corresponding to the meanings of the words set out in Column One of Schedule B, and
(b) have the same effect as if the corresponding parts of speech or tenses of the words set out in Column Two of Schedule B and distinguished by the same letter were used in that debenture.
4.1(2)Subsection (1) shall be deemed to have come into force
(a) with respect to debentures in Form 56 prescribed under the Land Titles Act, on July 9, 1984; and
(b) in all other respects, on October 15, 1984.
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5(1)A covenant or condition set out in Column One of Schedule C and distinguished by a number therein may be included in any debenture as may be applicable in the circumstances, by the inclusion of the covenant or condition set out in Column One of Schedule C together with its distinguishing number, and if so included, the debenture has the same effect as if it contained the covenant or condition set out in Column Two of Schedule C distinguished by the same number.
5(2)A debenture may contain any covenant or condition, whether or not the covenant or condition is otherwise provided for in this Regulation.
5(3)Where a debenture contains covenants and conditions which are set out in a document which is on file in a Registry Office or a Land Titles Office and are included in the debenture by reference to the number by which the document has been filed, the document shall be filed in every Registry Office or Land Titles Office where the debenture is registered.
5(4)Except as between the parties thereto, where a debenture in Form A56 contains covenants and conditions which are set out in an agreement which is neither registered nor on file in a Registry Office, and a conflict exists between that part of the debenture which is registered or on file and the agreement which is not, the terms of that part of the debenture which is registered or on file shall prevail.
5(5)Where a debenture in Form A56 contains covenants and conditions which are set out in an agreement which is neither registered nor on file in a Registry Office, an amendment to the agreement is void as against a third party unless notice of the amendment is registered in the Registry Office or unless the third party has actual notice of the amendment.
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6In any debenture made pursuant to this Regulation,
(a) where the context so requires, words importing the singular include the plural and words importing the plural include the singular, and words importing the masculine include the feminine and neuter genders and words importing the feminine include the masculine and neuter genders and words importing the neuter gender include the masculine and feminine genders;
(b) the term “corporation” includes the successors and assigns of the corporation, unless expressly stated to the contrary;
(c) the term “lender” includes the heirs, executors, administrators, successors and assigns of the lender, unless expressly stated to the contrary;
(d) all covenants, conditions, liabilities and obligations entered into or imposed upon a corporation shall be construed to be jointly and severally binding upon each of them and upon their successors and assigns, unless expressly stated to the contrary;
(e) all covenants, conditions, liabilities and obligations entered into or imposed upon a lender shall be construed to be jointly and severally binding upon each of them and upon their heirs, executors, administrators, successors and assigns, unless expressly stated to the contrary; and
(f) all covenants, conditions, liabilities and obligations entered into or imposed upon a guarantor shall be construed to be jointly and severally binding upon each of them and upon their heirs, executors, administrators, successors and assigns, unless expressly stated to the contrary.
7(1)Subject to this section, unless it is prepared in book form for deposit, a debenture shall be printed or typewritten on good quality white paper, 8.5 inches by 11 inches (22.6 cm by 27.94 cm) or 8.5 inches by 14 inches (22.6 cm by 35.6 cm), with a margin of not less than 1 inch (2.5 cm) on the top and left side of the page and, if printed on the reverse thereof, a margin of not less than one inch (2.5 cm) on the top and right side of the page, and shall be of sufficient clarity to permit photocopying or other reproduction.
7(2)Subsection (1) applies to all attachments to instruments referred to therein other than plans, instruments issued by a court, instruments and documents requiring registration under the Bankruptcy Act (Canada), instruments and documents prepared in book form for deposit and such other attached instruments and documents as, in the opinion of the registrar, are suitable for acceptance in a form other than that prescribed in subsection (1).
7(3)If an instrument is to be filed or registered under the Act by submitting a digitally scanned image of the instrument, the digitally scanned image shall be of sufficient clarity to be readable when reproduced.
7(4)If an instrument with a crimped or raised seal affixed to it is to be filed or registered under the Act by submitting a digitally scanned image of the instrument, the seal must be darkened or otherwise sufficiently enhanced so that the seal may be identified.
7(5)A registrar may refuse to file or register an instrument,
(a) with respect to a digitally scanned image of an instrument referred to in subsection (3), if the instrument is not of sufficient clarity to be readable by the registrar when reproduced, or
(b) with respect to a digitally scanned image of an instrument referred to in subsection (4), if the seal cannot be identified by the registrar.
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8This Regulation comes into force
(a) with respect to debentures in Form 56 prescribed under the Land Titles Act, on July 9, 1984; and
(b) in all other respects, on October 15, 1984.
Form A56
Form 56
DEBENTURE
Land Titles Act, S.N.B. 1981, c.L-1.1, s.26.1
Standard Forms of Conveyances Act, S.N.B. 1980, c.S-12.2, s.2
THIS FORM IS PRESCRIBED UNDER THE
GENERAL REGULATION - LAND TITLES ACT
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SCHEDULE B
Column One
Column Two
a.
lands and premises
a.  
real and immoveable property, including leasehold lands, but excepting and reserving the last day of any term of any lease, verbal or written, or any agreement therefor,  
 
b.  
undertaking  
b.  
undertaking, property and assets, for the time being, both real and personal, movable and immovable, of every nature and kind, now or hereafter owned or acquired, wherever situate, including its franchises, goodwill and uncalled capital, but excepting and reserving the last day of any term of any lease, verbal or written, or any agreement therefor,  
SCHEDULE C
Column One
Column Two
1001.
The corporation may deal with the charged property in the ordinary course of its business, provided that no encumbrance is created to rank in priority to the security hereunder.
1001.  
Until the security becomes enforceable, the corporation may dispose of or deal with the subject matter of the floating charge in the ordinary course of its business and for the purpose of carrying on the business provided that the corporation will not, without the prior written consent of the lender, create, assume or have outstanding, except to the lender, any mortgage, charge or other encumbrance on any part of the charged property ranking or purporting to rank or capable of being enforced in priority to or pari passu with the security hereunder, other than any mortgage, lien or other encumbrance upon property, created or assumed to secure all or any part of the funds required for the purchase of such property or any extension or renewal or replacement thereof upon the same property if the principal amount of the indebtedness secured thereby is not increased, or any inchoate liens for taxes or assessments by public authorities.  
 
1002.  
On default of payment by the corporation the security is enforceable.  
1002.  
In the event that the corporation makes default in the payment of principal or interest hereunder the security shall become enforceable.    
 
1002.1  
The security is enforceable upon any default by the corporation.
1002.1
The principal, interest and any other money hereby secured shall become immediately payable and the security hereby constituted shall become enforceable in each and every one of the events following:  
 
(a)if the corporation makes default in the payment  of principal when it becomes due and payable,  
 
(b)if the corporation makes default in the payment of interest when it becomes due and payable,  
 
(c)if the corporation becomes insolvent or bankrupt or subject to the provisions of the Winding-up Act or the Bankruptcy Act, or goes into liquidation, either voluntary or under an order of a court of competent jurisdiction, or makes a general assignment for the benefit of its creditors or otherwise acknowledges its insolvency,
 
(d)if an encumbrancer takes possession of any part of the property of the corporation, or if any process of execution is levied or enforced upon or against any part of the property of the corporation, provided that such process is not in good faith disputed by the corporation and in that event provided further that non-payment shall not in any way impair the security hereunder,
 
(e)if the corporation fails to pay taxes, rates, charges, rents payable on leasehold property or other charges of a like nature, whether governmental or otherwise, assessed or payable in respect of any property of the corporation (if the property is essential to efficient operation), provided that such charge is not in good faith disputed by the corporation,  
 
(f)if the corporation fails to observe and perform any of the covenants in any lease, licence, concession or agreement whereby any property or right of the corporation (if such property or right is essential to efficient operation) may become liable to forfeiture,  
 
(g)if the corporation defaults in observing or performing any other covenant or condition of this debenture on its part to be observed or performed,  
 
(h)if the corporation ceases or threatens to cease to carry on its business or if the corporation commits or threatens to commit any act of bankruptcy,  
 
(i)if the corporation defaults in the payment of any indebtedness or liability to the lender, whether secured hereunder or not, when it becomes due and payable.  
 
1003.  
The lender may waive any default by the corporation.
1003.
The lender may waive any default by the corporation in the observance or performance of any covenant or condition required to be observed or performed by the corporation under the terms of this debenture, provided always that no act or omission of the lender shall extend to or be taken in any manner whatsoever to affect any subsequent default.  
 
1004.  
When the security becomes enforceable the lender may
1004.
When the security becomes enforceable, the lender has the following remedies:  
 
(a)enter into possession,  
(a)entry into possession,  
 
(b)apply to the court for the appointment of a receiver,  
(b)proceedings in any court of competent jurisdiction for the appointment of a receiver (which term includes a receiver and manager) of all or any part of the charged property,  
 
(c)sell the charged property,  
(c)proceedings in any court of competent jurisdiction for sale of all or any part of the charged property,  
 
(d)file claims in any proceeding relating to the corporation,  
(d)filing of proofs of claim and other documents to establish its claims in any proceeding relative to the corporation,  
 
(e)appoint a receiver, or  
(e)appointment by instrument in writing of a receiver of all or any part of the charged property and removal or replacement from time to time of any such receiver, or  
 
(f)do anything else permitted by law.  
(f)any other remedy or proceeding authorized or permitted hereby or by law or equity.  
 
Such remedies may be exercised from time to time separately or in combination and are in addition to and not in substitution for any other rights of the lender however created.  
 
1005.  
The receiver may:  
1005.  
Any receiver appointed by instrument in writing has power to:  
 
(a)take possession of the charged property,  
(a)take possession of, collect and get in all or any part of the charged property and, for that purpose, to take proceedings in the name of the corporation or otherwise,
 
(b)carry on the business of the corporation,  
(b)carry on or concur in carrying on all or any part of the business of the corporation,  
 
(c)make compromises, and  
(c)to make any arrangement or compromise, and  
 
(d)sell the charged property.  
(d)sell or concur in selling all or any part of the charged property without notice and in such manner as may seem advisable to the receiver, and to effect such sale by conveying in the name and on behalf of the corporation or otherwise.  
 
1006.  
The receiver is the agent of the corporation.  
1006.  
The receiver shall for all purposes be deemed to be the agent of the corporation and not of the lender, and the corporation shall be solely responsible for his acts or defaults and for his remuneration.  
 
1007.  
All money received by the receiver shall be paid  
1007.  
All money from time to time received by the receiver shall be applied as follows:  
 
(a)to discharge expenses,  
(a)in discharge of all costs, charges and expenses of or incidental to the exercise of any of the powers of the receiver,  
 
(b)to keep in good standing prior charges,  
(b)in keeping in good standing all charges and liens on the charged property having priority over this debenture,
 
(c)to the receiver,  
(c)in payment of the remuneration and disbursements of the receiver,  
 
(d)to the lender, and  
(d)in payment to the lender of the money payable hereunder, and  
 
(e)lastly, to the corporation.  
(e)lastly, in payment to the corporation of the balance, if any.  
 
1008.  
The corporation shall pay expenses incurred by the lender to recover any payment hereunder.  
1008.  
The corporation agrees to pay to the lender forthwith on demand all costs, charges and expenses, including all legal fees (on a solicitor and client basis), incurred by the lender in connection with the recovery or enforcement of payment of any money owing hereunder whether by realization or otherwise; all such sums shall be secured hereby and shall be added to the principal hereof and bear interest at the rate herein stipulated until paid.  
 
1009.  
This debenture is a negotiable instrument.  
1009.  
This debenture is a negotiable instrument and all rights created hereunder are exercisable by any holder hereof.  
 
1010.  
Notice to the corporation may be given by mail.
1010.
Any notice to the corporation may be given by mailing it to the corporation at the address hereinbefore set out, and any notice so mailed shall be deemed to have been received by the corporation on the next business day following that on which it was so mailed.  
 
1011.  
This debenture may be pledged as collateral security for an operating line of credit.  
1011.  
This debenture may be deposited or pledged by the corporation as collateral security for its indebtedness and liabilities and, when redelivered to the corporation or its nominees, shall be forthwith cancelled; but this debenture shall not be deemed to have been redeemed by reason of the account of the corporation having ceased to be in debit while this debenture was so deposited or pledged and no payment shall reduce the amount owing under this debenture unless specifically appropriated to and noted on this debenture at the time of payment.  
 
1012.  
Where a conflict exists between the English version and the French version of any provision hereof, this debenture shall be construed as if it had been executed entirely in English.  
1012.  
The corporation and the lender mutually covenant and agree that, this debenture having been executed in both English and French, where a conflict exists between the English version and the French version of any provision hereof, the meaning and legal effect of the English version shall prevail.  
 
1012.1  
Where a conflict exists between the English version and the French version of any provision hereof, this debenture shall be construed as if it had been executed entirely in French.  
1012.1  
The corporation and the lender mutually covenant and agree that, this debenture having been executed in both English and French, where a conflict exists between the English version and the French version of any provision hereof, the meaning and legal effect of the French version shall prevail.  
 
1013.  
The corporation shall pay the principal sum, interest and other money due with interest.  
1013.  
The corporation covenants with the lender that the corporation shall pay to the lender the principal sum and interest as hereinbefore set out and all other money payable hereunder; on all arrears of principal, interest and any other sums due to the lender, interest shall be payable at the times and at the interest rate stated, before as well as after maturity, until paid.  
N.B. This Regulation is consolidated to May 15, 2018.