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Her Majesty, by and with the advice and consent of the Legislative Assembly of New Brunswick, enacts as follows:

I

INTERPRETATION AND APPLICATION

Definitions

1(1)In this Act

“advance” means value received, within the meaning of subsection (3), by the borrower or lessee; (avance)

“APR” means the annual percentage rate calculated in accordance with the regulations; (TAP)

“borrower” means an individual who has entered into, or who is negotiating to enter into, a credit agreement under which the individual receives or is to receive credit from a credit grantor, and includes(emprunteur)

(a) a credit card holder, and

(b) for the purposes of subsections (3), (4) and (5), except paragraphs (3)(b) and (h), a lessee,

but does not include a guarantor;

“brokerage fee” means an amount that a borrower pays or agrees to pay to a credit broker for the credit broker’s services in arranging, negotiating or facilitating or attempting to arrange, negotiate or facilitate an extension of credit to the borrower, and includes an amount that is(frais de courtage)

(a) deducted from the value received or to be received by a borrower in connection with a credit agreement, and

(b) paid to the credit broker by the credit grantor;

“business day” means a day on which a credit grantor is open for business; (jour ouvrable)

“cash customer” means a person who buys a product and who provides full payment for the product at or before the time of its receipt; (consommateur payant comptant)

“cash price” , in relation to a product, means(prix au comptant)

(a) for a sale to a borrower by a credit grantor, or by an associate of the credit grantor, who sells the product to cash customers in the ordinary course of business,

(i) an amount that fairly represents the price at which the credit grantor, or the associate of the credit grantor, sells the product to cash customers, or

(ii) if the credit grantor, or the associate of the credit grantor, and the borrower agree on a lower price, that lower price,

(b) for a sale to which paragraph (a) does not apply, the price agreed on by the credit grantor, or by the associate of the credit grantor, and the borrower, or

(c) for an advertisement published by or on behalf of a credit grantor, the price at which the product is currently offered by the credit grantor, or by an associate of the credit grantor, to cash customers or, if the credit grantor, or an associate of the credit grantor, does not currently offer the product to cash customers, the price stated in the advertisement,

and, for the purpose of determining the amount advanced under a credit agreement, includes taxes and any other charges payable by a cash customer;

“cash value” , in relation to leased goods, means(valeur au comptant)

(a) if the lessor sells like goods to cash customers in the ordinary course of business,

(i) a value that fairly represents the price at which the lessor sells the like goods to cash customers, or

(ii) if the lessor and lessee agree on a lower value, that value, or

(b) if the lessor does not sell like goods to cash customers in the ordinary course of business,

(i) the lessor’s reasonable estimate of the price at which cash customers would buy the leased goods, or

(ii) if the lessor and lessee agree on a lower value, that value;

“common-law partner” , with respect to a particular time, means a person who cohabits in a conjugal relationship with another person at that time and who has so cohabited with that person for a continuous period of at least 2 years; (conjoint de fait)

“Court” means The Court of Queen’s Bench of New Brunswick; (Cour)

“credit agreement” means an agreement under which credit is extended and includes(convention de crédit)

(a) an agreement in relation to

(i) a loan of money,

(ii) a credit sale,

(iii) a line of credit, or

(iv) a credit card,

(b) a renewal of or an amendment to an agreement referred to in paragraph (a), and

(c) for the purposes of subsections (3), (4) and (5), except paragraph (3)(h), a lease;

“credit broker” means a person who, for compensation, arranges, negotiates or facilitates or attempts to arrange, negotiate or facilitate an extension of credit from a credit grantor to a borrower; (courtier en crédit)

“credit card” means a card or other device that can be used to obtain advances under a credit agreement for open credit; (carte de crédit)

“credit card holder” means an individual who is a borrower in relation to a credit card; (titulaire d’une carte de crédit)

“credit card issuer” means a person who is a credit grantor in relation to a credit card; (émetteur d’une carte de crédit)

“credit grantor” means(prêteur)

(a) a person who has entered into, or who is negotiating to enter into, a credit agreement under which the person extends or is to extend credit to a borrower if

(i) the borrower has entered into or is to enter into the credit agreement primarily for the personal, family or household purposes of the borrower,

(ii) the credit is not in respect of the sale of goods intended for resale, and

(iii) the credit is for $100 or more, or

(b) an assignee of the original credit grantor’s rights under a credit agreement, if the borrower has been given notice of the assignment, and

includes

(c) a credit card issuer, and

(d) for the purposes of subsections (3), (4) and (5), except paragraphs (3)(b) and (g), a lessor;

“credit sale” means the sale of a product in which the purchase of the product is financed by the seller or manufacturer of the product or by an associate of the seller or manufacturer of the product, but does not include such a sale if(vente à crédit)

(a) the credit agreement in relation to the sale requires that the full amount of the sale price of the product be paid in a single payment within a specified period after a written invoice or statement of account is delivered to the buyer,

(b) the sale is unconditionally interest-free during the period referred to in paragraph (a),

(c) the sale is unsecured, apart from any lien on the product that may arise by operation of law,

(d) the sale is not assigned in the ordinary course of the credit grantor’s business otherwise than as security, and

(e) the sale does not provide for any non-interest finance charges;

“default charge” means a charge imposed on a borrower or lessee who fails to make a payment as it comes due under a credit agreement or lease or who fails to comply with any other obligation under a credit agreement or lease, but does not include interest on an overdue payment; (frais de défaut de paiement)

“fixed credit” means credit extended under a credit agreement that is not for open credit; (crédit fixe)

“floating rate” means an interest rate that bears a specified mathematical relationship to an index rate, and includes an interest rate that(taux variable)

(a) is subject to a minimum or maximum, or

(b) is determined at the beginning of a period and applies throughout the period, regardless of changes in the index rate during the period;

“grace period” means a period during which interest accrues but will be forgiven if the borrower satisfies conditions specified in the credit agreement; (délai de grâce)

“high-ratio mortgage” means high-ratio mortgage as defined in the regulations; (prêt hypothécaire à proportion élevée)

“index rate” means a rate that, in accordance with the terms of a credit agreement, is made available to a borrower, at least weekly,(taux indiciel)

(a) in a written publication that has general circulation in New Brunswick, or

(b) in some other manner that can reasonably be expected to make the rate available to the borrower;

“initial disclosure statement” means, in relation to a credit agreement or lease, the disclosure statement for that credit agreement or lease that is required to be delivered to the borrower or lessee under section 16; (document d’information initial)

“interest” means a charge that accrues over time and is determined by applying a rate to an amount owing under a credit agreement or lease; (intérêt)

“interest-free period” means a period following the making of an advance during which interest does not accrue on the advance; (période sans intérêt)

“lease” means an agreement for the hire of goods if the agreement(bail)

(a) is for a fixed term of 4 months or more,

(b) is for an indefinite term or is renewed automatically until one of the parties takes positive steps to terminate it, or

(c) is a residual obligation lease as defined in section 47, and

includes an amendment to such an agreement, but does not include an agreement or an amendment to an agreement for the hire of goods in connection with a residential tenancy agreement;

“lessee” means an individual who has entered into, or who is negotiating to enter into, a lease under which the individual hires or is to hire goods from a lessor; (preneur à bail)

“lessor” means(bailleur)

(a) a person who has entered into, or who is negotiating to enter into, a lease under which the person leases or is to lease goods to a lessee if the lessee has entered into or is to enter into the lease primarily for the personal, family or household purposes of the lessee, or

(b) an assignee of the original lessor’s rights under a lease, if the lessee has been given notice of the assignment;

“Minister” means the Minister of Justice and Consumer Affairs and includes any person designated by the Minister to act on the Minister’s behalf; (Ministre)

“mortgage loan” means mortgage loan as defined in the regulations; (prêt hypothécaire)

“non-interest finance charge” means any charge that a borrower is required to pay in connection with a credit agreement, other than(frais financiers autres que l’intérêt)

(a) interest,

(b) a prepayment charge,

(c) a default charge,

(d) a charge for an optional service,

(e) an expense, charge or fee referred to in paragraph (3)(f), (g) or (h) or in regulations under paragraph (3)(i), or

(f) in the case of a credit sale, any charge that would also be payable by a cash customer;

“open credit” means credit extended under a credit agreement if the credit agreement(crédit à découvert)

(a) anticipates multiple advances that are to be made when requested by the borrower in accordance with the credit agreement, and

(b) does not establish the total amount to be advanced to the borrower under the credit agreement, although it may impose a credit limit;

“optional service” means a service that is offered to a borrower or lessee in connection with a credit agreement or lease and that the borrower or lessee does not have to accept in order to enter into the credit agreement or lease; (service facultatif)

“outstanding balance” means the total amount owing at any particular time under a credit agreement; (solde impayé)

“payment” means value given, within the meaning of subsection (5), by the borrower or lessee; (versement)

“payment period” means one of the intervals into which the term of a credit agreement or lease is divided for the purpose of determining the amount of and timing of payments; (période de paiement)

“periodic payment” means the payment that, under a credit agreement or lease, is to be made in respect of each payment period; (versement périodique)

“product” means goods or services, but does not include the extension of credit; (produit)

“publish” means make public in any manner, including by or through any media; (publier)

“scheduled-payments credit agreement” means a credit agreement for fixed credit under which the amount advanced is to be repaid in accordance with a specified schedule of payments, which schedule of payments may be subject to adjustment to accommodate contingencies, including changes in the interest rate; (convention de crédit à remboursement à échéances fixes)

“security interest” means any interest in property that secures the borrower’s obligations under a credit agreement; (sûreté)

“term” means,(durée)

(a) in relation to the duration of a credit agreement, the period between the first advance and the last payment anticipated by the credit agreement, or

(b) in relation to the duration of a lease, the period during which the lessee is entitled to retain possession of the leased goods;

“total cost of credit” means the amount determined by calculating, subject to the conditions and assumptions contained in the regulations, the difference between(coût total du crédit)

(a) the value given or to be given, within the meaning of subsection (5), by the borrower in connection with a credit agreement, and

(b) the value received or to be received, within the meaning of subsection (3), by the borrower in connection with a credit agreement,

disregarding the possibility of prepayment or default.

Associates

1(2)For the purposes of this Act and the regulations, two persons are associates of each other if

(a) one of them is the spouse, common-law partner, parent, child, sibling or business partner of the other person, or

(b) one of them is a body corporate and a sufficient number of shares to elect a majority of the body corporate’s directors are beneficially owned, directly or indirectly, by

(i) the other person,

(ii) one or more associates of the other person, or

(iii) the other person and one or more associates of the other person.

Value received and value given

1(3)Subject to subsection (4), the following constitute value received or to be received by a borrower in connection with a credit agreement:

(a) money transferred or to be transferred by the credit grantor to the borrower or to the order of the borrower;

(b) in the case of a credit agreement other than a lease, the cash price of a product purchased or to be purchased by the borrower from the credit grantor or an associate of the credit grantor;

(c) in the case of a lease, the cash value of goods leased or to be leased by the lessee from the lessor;

(d) the amount of a pre-existing monetary obligation of the borrower that is paid, discharged or consolidated or is to be paid, discharged or consolidated by the credit grantor;

(e) the amount of money obtained or to be obtained or the cash price of a product obtained or to be obtained through the use of a credit card;

(f) charges for any of the following expenses, if the credit grantor has incurred or is to incur the expense for the purpose of arranging, documenting, insuring or securing the credit agreement and then charges the expense to the borrower:

(i) fees paid to a third party to record or register a document or information in, or to obtain a document or information from, a public registry of interests in real or personal property;

(ii) fees for professional services required for the purpose of confirming the value, condition, location or conformity to law of property that serves as security for the credit agreement, if the borrower is given a report signed by the person providing the professional services and may give the report to third persons;

(iii) premiums for insurance that protects the credit grantor against the borrower’s default on a high-ratio mortgage;

(iv) premiums for, in the case of a credit agreement other than a lease, casualty insurance on the subject matter of a security interest, if the borrower is a beneficiary of the insurance and the insured amount is the full insurable value of the subject matter;

(v) premiums for, in the case of a lease, casualty insurance on leased goods, if the lessee is a beneficiary of the insurance and the insured amount is the full insurable value of the leased goods;

(vi) premiums for any insurance provided or paid for by the credit grantor in connection with the credit agreement if the insurance is optional; and

(vii) application fees for insurance referred to in subparagraph (iii);

(g) fees for services provided or to be provided by the credit grantor to maintain a tax account on a high-ratio mortgage;

(h) charges for shares in a credit union that a borrower must buy as a condition of entering into a credit agreement with the credit union; and

(i) any other thing prescribed by regulation.

Value received and value given

1(4)The following do not constitute value received or to be received by a borrower in connection with a credit agreement unless they relate to an optional service, to an expense, charge or fee referred to in paragraph (3)(f), (g) or (h), or to a thing prescribed for the purposes of paragraph (3)(i):

(a) insurance provided or paid for or to be provided or paid for by the credit grantor in connection with the credit agreement;

(b) money paid or to be paid, an expense incurred or to be incurred, or anything done or to be done by the credit grantor for the purpose of arranging, documenting, securing, administering or renewing the credit agreement; and

(c) any other thing prescribed by regulation.

Value received and value given

1(5)The following constitute value given or to be given by a borrower in connection with a credit agreement:

(a) money or property transferred or to be transferred from the borrower to the credit grantor for any purpose in connection with the credit agreement;

(b) money or property transferred or to be transferred from the borrower to a person other than the credit grantor in respect of a charge for services that the credit grantor requires the borrower to obtain or pay for in connection with the credit agreement, unless the charge

(i) is for an expense to which paragraph (3)(f) or regulations under paragraph (3)(i) would have applied if the expense had been incurred initially by the credit grantor and then charged by the credit grantor to the borrower,

(ii) is for services provided by a lawyer chosen by the borrower, or

(iii) is for title insurance provided by an insurer chosen by the borrower; and

(c) any other thing prescribed by regulation.

Value received and value given

1(6)Notwithstanding subsections (3) and (5), amounts paid into or out of a tax account for a mortgage loan are not included when calculating the APR and total cost of credit.

2006, c.16, s.47

Statement of purpose for entering into credit agreement or lease

2A person may rely on a statement made by an individual in a credit agreement, lease or other document regarding the purpose for which the individual has entered into or is to enter into a credit agreement or lease if

(a) the statement is signed by the individual, and

(b) the person believes in good faith that the statement is true.

Application of Parts III to VII

3(1)A duty, in respect of a credit agreement, imposed on a credit grantor under Part III, V or VI or a right, benefit or protection, in respect of a credit agreement, granted to a borrower or credit grantor under Part III, V or VI applies in respect of any credit agreement entered into or to be entered into by the credit grantor in the ordinary course of carrying on a business on or after the commencement of this Act.

3(2)A duty, in respect of a credit agreement, imposed on a credit grantor or credit broker under Part IV applies in respect of any credit agreement that is entered into or to be entered into by the credit grantor on or after the commencement of this Act and that is arranged by a credit broker.

3(3)A duty, in respect of a lease, imposed on a lessor under Part III or VII or a right, benefit or protection, in respect of a lease, granted to a lessee or lessor under Part III or VII applies in respect of any lease entered into or to be entered into by the lessor in the ordinary course of carrying on a business on or after the commencement of this Act.

Waiver of rights under this Act or the regulations

4Any waiver or release by a person of the person’s rights, benefits or protections under this Act or the regulations is void except to the extent that the waiver or release is expressly permitted by this Act or the regulations.

Other remedies not precluded

5Any remedy under this Act is in addition to and does not derogate from any other legal, equitable or statutory remedy.

II

REGISTRATION

Mandatory registration

6(1)No credit grantor shall act as such in the ordinary course of carrying on a business unless the credit grantor is registered under this Part or is exempted from the application of this Part by regulation.

6(2)No lessor shall act as such in the ordinary course of carrying on a business unless the lessor is registered under this Part or is exempted from the application of this Part by regulation.

6(3)No credit broker shall act as such in the ordinary course of carrying on a business unless the credit broker is registered under this Part or is exempted from the application of this Part by regulation.

6(4)No person shall publish or cause to be published any statement or representation that the person is registered under this Part.

Application for registration

7(1)The Minister may register under this Part a credit grantor, lessor or credit broker who submits an application for registration and who meets the requirements for registration under this Part and the regulations.

7(2)An application for registration shall be made to the Minister on a form provided by the Minister and shall be accompanied by

(a) in the case of a credit grantor, copies of all documents used by the credit grantor in relation to the extension of credit,

(b) in the case of a lessor, copies of all documents used by the lessor in relation to the leasing of goods,

(c) in the case of a credit broker, copies of all documents used by the credit broker in relation to arranging, negotiating or facilitating or attempting to arrange, negotiate or facilitate an extension of credit,

(d) any other information or document that the Minister may require or that is prescribed by regulation, and

(e) the fee prescribed by regulation.

7(3)The Minister may refuse to register under this Part a credit grantor, lessor or credit broker who fails to meet the requirements for registration under this Part and the regulations.

Effect of withdrawal, suspension or cancellation of registration

8(1)The registration of a credit grantor remains in effect for the period of time prescribed by regulation unless the registration is withdrawn by the credit grantor, or is suspended or cancelled by the Minister, in which case, at the time of the withdrawal, suspension or cancellation, the registration ceases to have effect and the credit grantor ceases to be registered under this Part.

8(2)Notwithstanding subsection (1), a credit grantor whose registration has been withdrawn, suspended or cancelled may, if the credit grantor does not extend any new credit, continue to collect accounts receivable owing to the credit grantor at the time of the withdrawal, suspension or cancellation and, for that purpose, may renew credit agreements and otherwise deal with credit transactions originating before the withdrawal, suspension or cancellation.

8(3)The registration of a lessor remains in effect for the period of time prescribed by regulation unless the registration is withdrawn by the lessor, or is suspended or cancelled by the Minister, in which case, at the time of the withdrawal, suspension or cancellation, the registration ceases to have effect and the lessor ceases to be registered under this Part.

8(4)Notwithstanding subsection (3), a lessor whose registration has been withdrawn, suspended or cancelled may, if the lessor does not enter into any new leases, continue to collect accounts receivable owing to the lessor at the time of the withdrawal, suspension or cancellation and, for that purpose, may renew leases and otherwise deal with lease transactions originating before the withdrawal, suspension or cancellation.

8(5)The registration of a credit broker remains in effect for the period of time prescribed by regulation unless the registration is withdrawn by the credit broker, or is suspended or cancelled by the Minister, in which case, at the time of the withdrawal, suspension or cancellation, the registration ceases to have effect and the credit broker ceases to be registered under this Part.

8(6)Notwithstanding subsection (5), a credit broker whose registration has been withdrawn, suspended or cancelled may, if the credit broker does not arrange, negotiate or facilitate or attempt to arrange, negotiate or facilitate an extension of new credit, collect accounts receivable owing to the credit broker at the time of the withdrawal, suspension or cancellation, and, for that purpose, may deal with brokerage transactions originating before the withdrawal, suspension or cancellation.

Terms and conditions on registration

9(1)The Minister may, in accordance with the regulations, impose terms and conditions on the registration of a credit grantor, lessor or credit broker or on the suspension or cancellation of the registration of a credit grantor, lessor or credit broker.

9(2)In addition to any terms and conditions imposed in accordance with the regulations, the Minister may impose such terms and conditions as the Minister considers appropriate on the registration of a credit grantor, lessor or credit broker or on the suspension or cancellation of the registration of a credit grantor, lessor or credit broker.

Documents to be provided to the Minister

10(1)A credit grantor shall provide to the Minister

(a) immediately after an amendment is made to a document required to be provided to the Minister under paragraph 7(2)(a), a copy of the amended document, and

(b) upon the request of the Minister, a copy of any document that is used in relation to the extension of credit.

10(2)A lessor shall provide to the Minister

(a) immediately after an amendment is made to a document required to be provided to the Minister under paragraph 7(2)(b), a copy of the amended document, and

(b) upon the request of the Minister, a copy of any document that is used in relation to the leasing of goods.

10(3)A credit broker shall provide to the Minister

(a) immediately after an amendment is made to a document required to be provided to the Minister under paragraph 7(2)(c), a copy of the amended document, and

(b) upon the request of the Minister, a copy of any document that is used in relation to arranging, negotiating or facilitating or attempting to arrange, negotiate or facilitate an extension of credit.

Suspension or cancellation of registration

11(1)Subject to subsection (3), the Minister may suspend or cancel the registration of a credit grantor, lessor or credit broker

(a) if the credit grantor, lessor or credit broker has failed to comply with any term or condition under which the registration was granted,

(b) if, in the opinion of the Minister, the credit grantor, lessor or credit broker has violated or has failed to comply with any provision of this Act or the regulations or any order or direction given under this Act or the regulations, or

(c) if the Minister considers it to be in the public interest to suspend or cancel the registration.

11(2)Where a credit grantor, lessor or credit broker has more than one branch office in New Brunswick, the Minister may suspend or cancel the registration of the credit grantor, lessor or credit broker with respect to one or more of the branch offices instead of suspending or cancelling the registration with respect to all of the branch offices.

11(3)The Minister shall not suspend for a period of more than 30 days or cancel the registration of a credit grantor, lessor or credit broker without giving the credit grantor, lessor or credit broker an opportunity to be heard.

Appeals

12(1)A credit grantor, lessor or credit broker may appeal a decision made under section 7 or 11 by way of Notice of Application to a judge of the Court.

12(2)The Notice of Application shall be filed with the clerk of the Court within 30 days after the date of the decision.

12(3)A Notice of Application under subsection (1) shall be served by the credit grantor, lessor or credit broker on the Minister in accordance with the Rules of Court.

12(4)After the Minister has been served under subsection (3), the Minister shall forthwith deliver to the clerk of the Court for the judicial district in which the appeal is to be heard all documents in the Minister’s possession that are relevant to the appeal.

12(5)An appeal under subsection (1) stays the operation of the decision in respect of which the appeal is made.

12(6)To the extent that they are not inconsistent with this section, the Rules of Court apply to an appeal under this section.

Mandatory cancellation of registration

13The Minister shall cancel the registration of a credit grantor, lessor or credit broker

(a) if the Minister is satisfied that the credit grantor, lessor or credit broker is deceased,

(b) if the Minister is satisfied that a body corporate that is the credit grantor, lessor or credit broker has been dissolved, or

(c) if the credit grantor, lessor or credit broker has become bankrupt.

Notice of cancellation of registration

14The Minister shall cancel the registration of a credit grantor, lessor or credit broker by giving notice of the cancellation in The Royal Gazette.

Address for service and membership of partnership

15(1)In addition to providing the information referred to in subsection 7(2), a credit grantor, lessor or credit broker who applies for registration shall state in the application an address for service for the credit grantor, lessor or credit broker in New Brunswick.

15(2)Every credit grantor, lessor or credit broker required to be registered under this Part shall within 5 days after any change in the address for service of the credit grantor, lessor or credit broker give the Minister notice of the change and state the new address for service in New Brunswick.

15(3)Where a credit grantor, lessor or credit broker required to be registered under this Part is a partnership, the credit grantor, lessor or credit broker shall, within 5 days after any change in the membership of the partnership give notice of the change to the Minister and state the details of the change in membership.

III

GENERAL DISCLOSURE REQUIREMENTS AND
RIGHTS OF BORROWERS AND LESSEES

Delivery of initial disclosure statement

16(1)Subject to subsection (3), a credit grantor shall deliver the initial disclosure statement for a credit agreement to the borrower before the earlier of

(a) the date on which the borrower enters into the credit agreement, and

(b) the date on which the borrower makes any payment in connection with the credit agreement.

16(2)A lessor shall deliver the initial disclosure statement for a lease to the lessee before the earlier of

(a) the date on which the lessee enters into the lease, and

(b) the date on which the lessee makes any payment in connection with the lease.

16(3)A credit grantor shall deliver the initial disclosure statement for a credit agreement in relation to a mortgage loan to the borrower at least 2 business days before the earlier of

(a) the date on which the borrower incurs any obligation to the credit grantor in connection with the credit agreement, other than an obligation in respect of an expense, charge or fee referred to in paragraph 1(3)(f) or prescribed by regulation, and

(b) the date on which the borrower makes any payment to the credit grantor in connection with the credit agreement, other than a payment in respect of an expense, charge or fee referred to in paragraph 1(3)(f) or prescribed by regulation.

16(4)The borrower under a credit agreement referred to in subsection (3) may, in accordance with the regulations, waive the time period referred to in that subsection, and, in that event, the credit grantor shall deliver the initial disclosure statement for the credit agreement in relation to the mortgage loan on or before the earlier of the dates referred to in paragraphs (3)(a) and (b).

Disclosure in advertisements

17Where a credit grantor or lessor who publishes an advertisement or on whose behalf an advertisement is published is, as a result of disclosing certain information in the advertisement, required under this Act to include additional information in the advertisement, the credit grantor or lessor shall ensure that,

(a) if the information that is required to be included is the APR, the APR is disclosed at least as prominently as is the information that necessitated the inclusion of the APR, and

(b) the additional information to be included is disclosed in a conspicuous manner.

Form of disclosure statements and statements of account

18(1)A credit grantor or lessor who is required to provide a disclosure statement or a statement of account under this Act shall ensure that the statement

(a) is in writing, or, with the consent of the borrower or lessee, in any other form that allows the borrower or lessee to retain the statement for future reference,

(b) contains the information required under this Act, and

(c) expresses the information referred to in paragraph (b) clearly, concisely, in a logical order and in a manner that is likely to bring the information to the attention of the borrower or lessee.

18(2)A disclosure statement or a statement of account may be a separate document or part of another document.

Delivery of documents by credit grantors or lessors

19(1)Where a credit grantor or lessor is required under this Act to deliver a disclosure statement, statement of account, notice or other document to a borrower or lessee, any of the following methods may be used:

(a) personal delivery;

(b) ordinary mail;

(c) registered mail;

(d) prepaid courier;

(e) telephone transmission producing a facsimile; or

(f) with the consent of the borrower or lessee, any other method that allows the borrower or lessee to retain the disclosure statement, statement of account, notice or other document for future reference.

19(2)Where there is more than one borrower under a credit agreement or more than one lessee under a lease, the credit grantor or lessor may, with the consent of all the borrowers or lessees, deliver a disclosure statement, statement of account, notice or other document to any one of the borrowers or lessees.

19(3)Subsection (2) does not apply to a notice or other document prescribed by regulation.

19(4)Where the consent referred to in subsection (2) is given and delivery of a disclosure statement, statement of account, notice or other document is made to one of the borrowers under the credit agreement or one of the lessees under the lease, any other borrower under the credit agreement or any other lessee under the lease may request a separate disclosure statement, statement of account, notice or other document, and the credit grantor or lessor shall provide it free of charge within 30 days after the request.

Estimates and assumptions

20A credit grantor or lessor may base information disclosed under this Act, whether in a disclosure statement, statement of account, advertisement or otherwise, on an estimate or assumption if

(a) the disclosure depends on information that is not ascertainable by the credit grantor or lessor at the time of disclosure, and

(b) the estimate or assumption is reasonable and is clearly identified as an estimate or assumption.

Borrower or lessee may choose insurer

21(1)A borrower or lessee who is required by a credit grantor or lessor to purchase insurance may purchase it from any insurer authorized to provide that type of insurance in New Brunswick, except that the credit grantor or lessor may, on reasonable grounds, disapprove an insurer selected by the borrower or lessee.

21(2)A credit grantor or lessor who offers to provide or to arrange insurance referred to in subsection (1) shall, at the time of the offer, clearly disclose to the borrower or lessee in writing that the borrower or lessee may, subject to subsection (1), purchase the required insurance through an insurance agent and from an insurer of the borrower’s or lessee’s choice.

Borrower or lessee may cancel optional services

22(1)A borrower or lessee may cancel an optional service of a continuing nature that is provided by the credit grantor or lessor or an associate of the credit grantor or lessor by giving 30 days’ notice, or such shorter period of notice as is provided for by the agreement under which the service is provided.

22(2)A borrower or lessee who cancels an optional service under subsection (1)

(a) is not liable for charges relating to any portion of the service that has not been provided at the time of cancellation, and

(b) is entitled to a refund of any amount already paid for those charges.

Prepayment

23(1)This section does not apply in respect of credit agreements in relation to mortgage loans.

23(2)A borrower is entitled to prepay the outstanding balance of a credit agreement at any time without any prepayment charge or penalty.

23(3)Where a borrower prepays the outstanding balance of a credit agreement for fixed credit, the credit grantor shall refund or credit the borrower with a portion of any non-interest finance charges paid by the borrower or added to the outstanding balance.

23(4)The portion of each non-interest finance charge that shall be refunded or credited to the borrower under subsection (3) shall be calculated in accordance with the regulations.

23(5)A borrower is entitled, on any scheduled payment date, or at least monthly, to prepay a portion of the outstanding balance of a credit agreement for fixed credit, without any prepayment charge or penalty, but, in that event, is not entitled to a refund or credit in respect of any non-interest finance charges.

Default charges

24(1)A credit grantor or lessor shall not impose by a credit agreement or lease any default charges other than the following:

(a) reasonable charges in respect of legal costs incurred in collecting or attempting to collect a payment;

(b) reasonable charges in respect of costs, including legal costs, incurred in realizing a security interest or protecting the subject matter of a security interest after the borrower has defaulted under a credit agreement; and

(c) reasonable charges that reflect the costs incurred by the credit grantor or lessor because a cheque or other payment instrument given by the borrower or lessee to the credit grantor or lessor was dishonoured.

24(2)For the purposes of paragraphs (1)(a) and (b), reasonable charges include solicitor and client costs.

24(3)A borrower or lessee is not liable for any default charge other than a default charge imposed under paragraphs (1)(a) to (c).

Invitation to defer payment

25(1)Where a credit grantor or lessor invites a borrower or lessee to defer making a payment that would otherwise be due under a credit agreement or lease, the credit grantor or lessor shall clearly disclose in the invitation whether or not interest will accrue on the unpaid amount during the period during which payment is deferred.

25(2)Where an invitation referred to in subsection (1) does not state whether or not interest will accrue on the unpaid amount during the period during which payment is deferred, the credit grantor or lessor shall be deemed to waive the interest that would otherwise accrue during the period.

IV

CREDIT BROKERS

Credit brokers and non-business credit grantors

26(1)This section applies where a credit broker arranges a credit agreement involving a credit grantor who does not enter into the credit agreement in the ordinary course of carrying on a business.

26(2)Sections 16, 18, 19, 20, 32, 33, 34, 35, 36, 37, 41 and 42 apply with the necessary modifications to a credit broker.

26(3)Notwithstanding subsection (2), the references to “credit grantor” in paragraphs 16(3)(a) and (b), 32(1)(u), 36(3)(c), 41(1)(i) and 42(2)(b) shall continue to be read as “credit grantor” and the reference to “whether or not the credit grantor is willing” in subsection 36(1) shall continue to be read as “whether or not the credit grantor is willing”.

26(4)For the purposes of subsection (2), the reference to “credit grantor” in subsection 1(1) in the definition “business day” shall be read as “credit broker” and the reference in subsection 36(2) to “credit grantor who is willing to renew a credit agreement in relation to a mortgage loan shall” shall be read as “credit broker shall, if the credit grantor is willing to renew a credit agreement in relation to a mortgage loan,”.

26(5)Where the borrower pays or is required to pay a brokerage fee, the credit broker shall ensure that the initial disclosure statement for the credit agreement, in addition to containing any other information required under this Act to be disclosed in an initial disclosure statement for the credit agreement,

(a) states the amount of the brokerage fee, and

(b) accounts for the brokerage fee in the APR and the total cost of credit.

Credit brokers and business credit grantors

27(1)This section applies where a credit broker arranges a credit agreement involving a credit grantor who enters into the credit agreement in the ordinary course of carrying on a business.

27(2)Where the credit grantor deducts a brokerage fee from the value received or to be received by the borrower in connection with the credit agreement, the credit grantor shall ensure that the initial disclosure statement for the credit agreement, in addition to containing any other information required under this Act to be disclosed in an initial disclosure statement for the credit agreement,

(a) states the amount of the brokerage fee, and

(b) accounts for the brokerage fee in the APR and the total cost of credit.

27(3)Where the credit broker takes a loan application from the borrower and forwards it to the credit grantor, the credit broker shall deliver to the borrower a disclosure statement for the credit agreement containing

(a) the information referred to in paragraphs (2)(a) and (b), and

(b) any other information that is required under this Act to be disclosed in an initial disclosure statement for the credit agreement.

27(4)Section 16 applies with the necessary modifications to a disclosure statement under subsection (3).

27(5)Notwithstanding subsection (4), the references to “credit grantor” in paragraphs 16(3)(a) and (b) shall continue to be read as “credit grantor”.

27(6)For the purposes of subsection (4), the reference to “credit grantor” in subsection 1(1) in the definition “business day” shall be read as “credit broker”.

27(7)Where the credit broker is required to deliver a disclosure statement under subsection (3), the credit grantor may adopt the disclosure statement as its initial disclosure statement.

27(8)Subject to subsection (9), section 16 does not apply to a credit grantor who adopts a disclosure statement as its initial disclosure statement under subsection (7).

27(9)A credit grantor who adopts a disclosure statement as its initial disclosure statement under subsection (7) shall ensure that the disclosure statement contains the information required under this Act to be disclosed in an initial disclosure statement for the credit agreement.

V

FIXED CREDIT

Application of Part

28This Part applies in respect of credit agreements for fixed credit.

Credit sales

29Where a credit agreement is in relation to a credit sale, the credit grantor shall ensure that the credit agreement is a scheduled-payments credit agreement.

Advertising for fixed credit

30(1)This section applies in respect of advertisements that

(a) offer fixed credit, and

(b) state the interest rate or amount of any payment.

30(2)A credit grantor shall ensure that an advertisement that is published by or on behalf of the credit grantor states

(a) the APR, and

(b) the term.

30(3)In addition to complying with subsection (2), the credit grantor shall ensure that

(a) an advertisement for a credit sale of a specifically identified product states the cash price of the product, and

(b) an advertisement for a credit sale of a specifically identified product in connection with which any non-interest finance charge is payable states

(i) the cash price of the product, and

(ii) the total cost of credit.

30(4)Notwithstanding paragraph (3)(b), an advertisement on radio, television, a billboard or another medium with similar time or space limitations need not state the total cost of credit.

30(5)Where any of the information required to be disclosed under subsection (2) or (3) would not be the same for all credit agreements to which the advertisement relates, the credit grantor shall ensure that the information is for a representative transaction and is identified as being for a representative transaction.

30(6)For the purposes of subsection (5), a transaction is a representative transaction if its terms are typical of the terms of the credit agreements to which the advertisement relates.

Advertising interest-free periods

31(1)A credit grantor shall ensure that an advertisement that is published by or on behalf of the credit grantor and that states or implies that no interest is payable for a certain period in respect of a transaction under a credit agreement, states whether

(a) the transaction is unconditionally interest-free during the period, or

(b) interest accrues during the period but will be forgiven under certain conditions.

31(2)If interest accrues during the period but will be forgiven under certain conditions, the credit grantor shall ensure that the advertisement also states

(a) the conditions, and

(b) the APR for the period, assuming the conditions are not met.

31(3)An advertisement referred to in subsection (1) that does not contain the information required to be disclosed under paragraph (1)(b) and subsection (2) shall be deemed to represent that the transaction is unconditionally interest-free during the relevant period.

Initial disclosure statement for fixed credit

32(1)A credit grantor shall ensure that the initial disclosure statement for a scheduled-payments credit agreement contains the following information:

(a) the effective date of the statement;

(b) for a credit sale, a description of the product;

(c) the outstanding balance as of the effective date of the statement, taking into account every payment made by the borrower on or before the effective date of the statement;

(d) the nature and amount of each advance, charge or payment taken into account in the outstanding balance disclosed under paragraph (c);

(e) the term;

(f) the amortization period if it is longer than the term;

(g) the date on which interest begins to accrue and the details of any grace period;

(h) the annual interest rate and the circumstances under which interest will be compounded;

(i) if the annual interest rate may change during the term,

(i) the initial annual interest rate and the compounding period,

(ii) the method of determining the annual interest rate at any time, and

(iii) unless the amount of scheduled payments is adjusted automatically to account for changes in the annual interest rate, the lowest annual interest rate, based on the initial outstanding balance, at which the payments would not cover the interest that would accrue between payments;

(j) the nature and amount of any charges, other than interest, that are not disclosed under paragraph (d) but that will become payable by the borrower in connection with the credit agreement;

(k) the amount and timing of any advances to be made after the effective date of the disclosure statement;

(l) the amount and timing of any payments to be made after the effective date of the disclosure statement;

(m) the total of all advances made or to be made in connection with the credit agreement;

(n) the total of all payments to be made in connection with the credit agreement;

(o) the total cost of credit;

(p) the APR;

(q) the nature of any default charges provided for by the credit agreement;

(r) a description of the subject matter of any security interest;

(s) for a credit agreement in relation to a mortgage loan, a statement of the conditions, if any, under which the borrower may make prepayments, and any charge for prepayment;

(t) for a credit agreement other than a credit agreement in relation to a mortgage loan, a statement that

(i) the borrower is entitled to prepay the outstanding balance at any time without any prepayment charge or penalty, and

(ii) the borrower is entitled to prepay a portion of the outstanding balance on any scheduled payment date, or at least monthly, without any prepayment charge or penalty;

(u) the nature, amount and timing of charges for any optional services purchased by the borrower that are payable to or through the credit grantor; and

(v) the conditions under which the borrower may terminate services referred to in paragraph (u).

32(2)A credit grantor shall ensure that the initial disclosure statement for a credit agreement that is not a scheduled-payments credit agreement

(a) contains the information referred to in paragraphs (1)(a) to (d), (g) to (j), (m) and (p) to (v), and

(b) either states the circumstances under which the outstanding balance, or any portion of it, must be paid or specifies the provisions of the credit agreement that describe those circumstances.

Disclosure regarding changes in interest rate

33(1)Where the interest rate under a credit agreement is a floating rate, the credit grantor shall, at least once every 12 months, deliver to the borrower a disclosure statement for the credit agreement containing the following information:

(a) the period covered by the statement, which period shall run from the date of the disclosure statement most recently delivered to the borrower under this section or section 32;

(b) the annual interest rate at the beginning and end of the period covered by the statement;

(c) the outstanding balance at the beginning and end of the period covered by the statement; and

(d) for a scheduled-payments credit agreement, the amount and timing of all remaining payments based on the annual interest rate that applies at the end of the period covered by the statement.

33(2)Where the interest rate under a credit agreement is not a floating rate but is nevertheless subject to change, the credit grantor shall, within 30 days after the date on which the annual interest rate is increased by 1% or more over the rate most recently disclosed to the borrower, deliver to the borrower a disclosure statement for the credit agreement containing the following information:

(a) the date of the statement;

(b) the new annual interest rate and the date on which the new rate took effect; and

(c) the timing and new amount of any payments to be made after the date referred to in paragraph (b).

Disclosure regarding increases in outstanding principal

34(1)Within 30 days after an increase in the outstanding principal under a scheduled-payments credit agreement, the credit grantor shall deliver to the borrower a notice in writing where

(a) the outstanding principal increases because of

(i) the compounding of interest on a missed or late payment, or

(ii) the imposition of a default charge, and

(b) as a result of the increase in the outstanding principal, the total amount of the payments that the borrower is scheduled to make over a payment period will not cover the interest that accrues during the payment period.

34(2)A notice referred to in subsection (1) shall specify

(a) that the outstanding principal has increased and why the outstanding principal has increased,

(b) that, because of the increase in the outstanding principal, the subsequent scheduled payments will not cover the interest that will accrue in each payment period, and

(c) what the outstanding balance will be at the end of the term if the amount of subsequent scheduled payments is not adjusted.

Disclosure regarding amendment

35(1)This section does not apply to changes effected by a renewed agreement to which section 36 or 37 applies.

35(2)If a credit agreement is amended, the credit grantor shall, within 30 days after the amendment is made, deliver to the borrower a supplementary disclosure statement that meets the requirements of subsection (3).

35(3)A supplementary disclosure statement referred to in subsection (2) shall set out the information that, as a result of the amendment to the credit agreement, is changed from the initial disclosure statement but need not repeat any information that is unchanged from the initial disclosure statement.

35(4)Where an amendment consists only of a revision to the schedule of payments, a supplementary disclosure statement referred to in subsection (2) need not state any change in the APR or any decrease in the total cost of credit or total payments.

Disclosure regarding renewals of credit agreements in relation to mortgage loans

36(1)Where the amortization period for a mortgage loan under a scheduled-payments credit agreement is longer than the term of the credit agreement, the credit grantor shall, at least 21 days before the end of the term, deliver to the borrower a written notice stating whether or not the credit grantor is willing to renew the credit agreement in relation to the mortgage loan for a further term.

36(2)A credit grantor who is willing to renew a credit agreement in relation to a mortgage loan shall include with the notice referred to in subsection (1) a disclosure statement for the renewed agreement that contains the following information and is based on the assumption that the borrower will make all payments that are due under the original credit agreement in relation to the mortgage loan:

(a) the effective date of the renewed agreement;

(b) the outstanding balance as of the effective date of the renewed agreement;

(c) the nature and amount of any non-interest finance charges that are payable in connection with the renewed agreement;

(d) the term;

(e) the relevant interest rate information referred to in paragraph 32(1)(h) or (i);

(f) the APR;

(g) the amount and timing of all payments to be made in connection with the renewed agreement;

(h) the total of all payments to be made in connection with the renewed agreement;

(i) the total cost of credit;

(j) the amortization period; and

(k) a statement of the conditions, if any, under which the borrower may make prepayments, and any charge for prepayment.

36(3)Where a credit agreement in relation to a mortgage loan is to be renewed, and the credit grantor does not, at least 21 days before the effective date of the renewed agreement, deliver to the borrower a disclosure statement that reflects the terms of the renewed agreement,

(a) the credit grantor shall, on or before the effective date of the renewed agreement, deliver to the borrower a disclosure statement that reflects the terms of the renewed agreement,

(b) the borrower is entitled to prepay the outstanding balance of the renewed agreement without penalty at any time within 21 days after receiving the disclosure statement referred to in paragraph (a), and

(c) the borrower, on exercising the right referred to in paragraph (b), is entitled to a refund by the credit grantor of any non-interest finance charges imposed in connection with the renewed agreement.

36(4)Subsection (3) does not apply if a credit grantor delivers to the borrower a disclosure statement for the renewed agreement at least 21 days before the effective date of the renewed agreement, and the disclosure statement does not reflect the terms of the renewed agreement for any of the following reasons:

(a) the outstanding balance on the effective date of the renewed agreement differs from what was stated in the disclosure statement because of one or more missed, late, early or extra payments;

(b) the interest rate under the renewed agreement is lower than the interest rate stated in the disclosure statement; or

(c) the amortization period or frequency of payments under the renewed agreement differs from what was stated in the disclosure statement.

36(5)If subsection (4) applies, the credit grantor shall, within 30 days after the effective date of the renewed agreement, deliver to the borrower a revised disclosure statement that reflects the terms of the renewed agreement.

Disclosure regarding renewals of credit agreements not in relation to mortgage loans

37Where a credit agreement, other than a credit agreement in relation to a mortgage loan, is renewed, the credit grantor shall deliver to the borrower on or before the effective date of the renewed agreement a disclosure statement containing the information referred to in paragraphs 36(2)(a) to (k).

VI

OPEN CREDIT

Application of Part

38This Part applies in respect of credit agreements for open credit.

Advertising for open credit

39(1)A credit grantor shall ensure that an advertisement that is published by or on behalf of the credit grantor and that gives any specific information about the cost of open credit that is not in relation to a credit card states the APR for the open credit.

39(2)A credit card issuer shall ensure that an advertisement that is published by or on behalf of the credit card issuer and that gives any specific information about the cost of open credit that is in relation to a credit card states

(a) the current annual interest rate for the open credit, and

(b) any initial or periodic non-interest finance charges for the open credit.

Advertising interest-free periods

40(1)A credit grantor shall ensure that an advertisement that is published by or on behalf of the credit grantor and that states or implies that no interest is payable for a certain period in respect of a transaction under a credit agreement states whether

(a) the transaction is unconditionally interest-free during the period, or

(b) interest accrues during the period but will be forgiven under certain conditions.

40(2)If interest accrues during the period but will be forgiven under certain conditions, the credit grantor shall ensure that the advertisement also states

(a) the conditions, and

(b) the annual interest rate for the period, assuming the conditions are not met.

40(3)An advertisement referred to in subsection (1) that does contain the information required to be disclosed under paragraph (1)(b) and subsection (2) shall be deemed to represent that the transaction is unconditionally interest-free during the relevant period.

Initial disclosure statement for open credit

41(1)A credit grantor shall ensure that the initial disclosure statement for a credit agreement contains the following information:

(a) the effective date of the statement;

(b) the credit limit;

(c) the minimum periodic payment or the method of determining the minimum periodic payment;

(d) the initial annual interest rate and the compounding period;

(e) if the annual interest rate may change, the method of determining the annual interest rate at any time;

(f) the date on which interest begins to accrue on advances or different types of advances and the details of any grace period;

(g) the nature and amount, or the method of determining the amount, of any non-interest finance charges that may become payable by the borrower in connection with the credit agreement;

(h) for open credit that is not in relation to a credit card, the APR;

(i) the nature, amount and timing of charges for any optional services purchased by the borrower that are payable to or through the credit grantor and the conditions under which the borrower may terminate the services;

(j) a description of the subject matter of any security interest;

(k) the nature of any default charges provided for by the credit agreement;

(l) how often the borrower will receive statements of account; and

(m) a telephone number in accordance with subsection 42(3).

41(2)A credit grantor does not violate subsection (1) by reason only of failing to ensure that the credit limit referred to in paragraph (1)(b) is contained in the initial disclosure statement if the credit grantor ensures that the credit limit is disclosed

(a) in the first statement of account delivered to the borrower, or

(b) in a separate statement delivered to the borrower on or before the date on which the borrower receives the first statement of account.

41(3)A credit grantor does not violate subsection (1) by reason only of failing to ensure that information that relates to a specific transaction under the credit agreement or that information referred to in paragraph (1)(i) about optional services is contained in the initial disclosure statement if the credit grantor ensures that the information is disclosed in a separate document delivered to the borrower before the transaction occurs or the optional services are provided.

Statement of account

42(1)Subject to subsection (2), the credit grantor shall deliver to the borrower, at least monthly, a statement of account that contains the following information:

(a) the period covered by the statement, which period shall run from the date of the first advance or, if a statement of account has been delivered under this section, from the date of the statement of account most recently delivered to the borrower;

(b) the outstanding balance at the beginning of the period covered by the statement;

(c) the amount, description and posting date of each transaction or charge added to the outstanding balance during the period covered by the statement;

(d) the amount and posting date of each payment or credit subtracted from the outstanding balance during the period covered by the statement;

(e) the annual interest rate or rates in effect during the period covered by the statement or any part of the period;

(f) the total of all amounts added to the outstanding balance during the period covered by the statement;

(g) the total of all amounts subtracted from the outstanding balance during the period covered by the statement;

(h) the outstanding balance at the end of the period covered by the statement;

(i) the credit limit;

(j) the minimum payment;

(k) the due date for payment;

(l) the amount that the borrower must pay on or before the due date in order to take advantage of a grace period;

(m) the borrower’s rights and obligations regarding the correction of billing errors; and

(n) a telephone number in accordance with subsection (3).

42(2)A credit grantor is not required to send a statement of account to a borrower at the end of any period during which there has been no advance or payment if

(a) the outstanding balance at the end of the period is zero, or

(b) the borrower is in default under the credit agreement and the credit grantor has

(i) demanded payment of the outstanding balance, and

(ii) notified the borrower that the privilege of obtaining advances under the credit agreement has been cancelled or suspended due to the default.

42(3)The credit grantor shall, for the purposes of paragraphs (1)(n) and 41(1)(m),

(a) provide a telephone number that the borrower can call to obtain information about the borrower’s account during the credit grantor’s normal business hours without incurring any charges for the call, and

(b) the credit grantor shall ensure that the information is available at the telephone number during those hours.

42(4)A transaction is sufficiently described for the purposes of paragraph (1)(c) if the description in the statement of account, along with any transaction record included with the statement of account or made available to the borrower at the time of the transaction, can reasonably be expected to enable the borrower to verify the transaction.

Credit card may only be issued on application

43A credit card issuer shall not issue, deliver or cause to be delivered a credit card to an individual who has not applied for the card unless the credit card that is issued to the individual is to replace or renew a credit card that was applied for and issued to that individual.

Application for credit card

44(1)A credit card issuer shall ensure that the application form for a credit card contains the following information respecting the credit agreement in relation to the credit card:

(a) if the interest rate under the credit agreement is not a floating rate, the annual interest rate;

(b) if the interest rate under the credit agreement is a floating rate, the index rate and the relationship between the index rate and the annual interest rate;

(c) the details of any grace period;

(d) the nature and amount of any non-interest finance charges that are payable or may become payable by the credit card holder; and

(e) the date as of which the information referred to in paragraphs (a) to (d) is current.

44(2)A credit card issuer does not violate subsection (1) by reason only of failing to ensure that the application form contains the information referred to in paragraphs (1)(a) to (e) if the application form states a telephone number that the individual may call during the credit card issuer’s normal business hours, without incurring any charges for the call, to obtain the information referred to in paragraphs (1)(a) to (e), and the credit card issuer ensures that

(a) the categories of the information available at the telephone number for the purposes of this subsection appear on the application form, and

(b) the information referred to in paragraphs (1)(a) to (e) is available at the telephone number during the credit card issuer’s normal business hours.

44(3)Where a credit card issuer communicates directly with an individual, whether in person or by mail, telephone or any electronic means, for the purpose of inviting the individual to apply for a credit card, the credit card issuer shall disclose in the communication the information referred to in paragraphs (1)(a) to (e).

44(4)A credit card issuer does not violate subsection (3) by reason only of failing to disclose the information referred to in paragraphs (1)(a) to (e) if, in the communication, the credit card issuer discloses a telephone number that the individual may call during the credit card issuer’s normal business hours, without incurring any charges for the call, to obtain the information referred to in paragraphs (1)(a) to (e), and the credit card issuer ensures that

(a) the categories of the information available at the telephone number for the purposes of this subsection are disclosed to the individual in the communication, and

(b) the information referred to in paragraphs (1)(a) to (e) is available at the telephone number during the credit card issuer’s normal business hours.

44(5)Notwithstanding subsections (2) and (4), where an individual applies for a credit card in person, by telephone or by any electronic means, the credit card issuer shall disclose the information referred to in paragraphs (1)(a) to (e) when the individual makes the application.

44(6)An individual who applies for a credit card without signing an application form shall be deemed, on using the credit card for the first time, to have entered into a credit agreement in relation to the credit card.

44(7)Nothing in this section relieves the credit card issuer of the requirement to deliver an initial disclosure statement referred to in sections 16, 41 and 45.

Additional disclosure for credit card

45(1)In addition to the information required to be disclosed under section 41,

(a) a credit card issuer shall ensure that the initial disclosure statement for a credit agreement in relation to a credit card states the credit card holder’s maximum liability for unauthorized use of the credit card if the credit card is lost or stolen, and

(b) if a credit card holder is required under the credit agreement to pay the outstanding balance on receiving each statement of account, a credit card issuer shall ensure that the initial disclosure statement for the credit agreement in relation to the credit card states

(i) that the outstanding balance is payable on receipt of each statement of account,

(ii) the period after receipt of a statement of account within which the credit card holder must pay the outstanding balance in order to avoid being in default under the agreement, and

(iii) the annual interest rate that will apply to any amount that is not paid when due.

45(2)The credit card issuer shall notify the credit card holder of any change in the information disclosed in the initial disclosure statement for the credit agreement in relation to the credit card,

(a) in the case of any of the following changes, in the next statement of account following the change or in a document that is given to the credit card holder with the next statement of account:

(i) a change in the credit limit;

(ii) a decrease in the interest rate or the amount of any other charge;

(iii) an increase in the length of an interest-free period or grace period; or

(iv) a change in a floating rate, or

(b) in the case of any other change, at least 30 days before the date that the change takes effect.

Liability of credit card holder

46(1)A credit card holder who has, orally or in writing, reported a lost or stolen credit card, or the unauthorized use of the credit card or credit card number, to the credit card issuer is not liable for any debt incurred through the use of that credit card or credit card number after the credit card issuer receives the report.

46(2)The maximum total liability of a credit card holder arising from unauthorized use of a lost or stolen credit card before the credit card issuer receives notice under subsection (1) is the lesser of

(a) $50, and

(b) the maximum amount set by the credit agreement in relation to the credit card.

46(3)Subsection (2) does not apply to the use of a credit card in conjunction with a personal identification number at a device commonly referred to as an automated teller machine or ATM.

VII

LEASE OF GOODS

Definitions

47In this Part

“assumed residual payment” means,(versement résiduel présumé)

(a) in the case of an option lease under which the option price at the end of the term is less than the estimated residual value, the option price, and

(b) in any other case, the sum of the estimated residual value and of any amount that the lessee will be required to pay in the ordinary course of events at the end of the term;

“capitalized amount” means the amount calculated by(montant capitalisé)

(a) adding

(i) the cash value of the leased goods, and

(ii) the amount of any other advances made to the lessee at or before the beginning of the term, and

(b) subtracting from the amount calculated under paragraph (a) the total amount of all payments made by the lessee at or before the beginning of the term, other than

(i) any refundable security deposit, or

(ii) any periodic payment;

“estimated residual cash payment” means the amount that the lessee will be required to pay to the lessor at the end of the term of a residual obligation lease if the realizable value of the leased goods at the end of the term equals their estimated residual value; (versement résiduel estimatif en espèces)

“estimated residual value” means the lessor’s reasonable estimate of the wholesale value of the leased goods at the end of the term as estimated by the lessor at the time the lease was entered into; (valeur résiduelle estimative)

“implicit finance charge” means the amount calculated, subject to the conditions and assumptions contained in the regulations, by(frais de financement implicites)

(a) adding

(i) all non-refundable payments required to be made by the lessee at or before the beginning of, or during, the term, and

(ii) the assumed residual payment, and

(b) subtracting from the amount calculated under paragraph (a) the total amount of the advances received by the lessee;

“option lease” means a lease that gives the lessee the right to acquire title to or retain permanent possession of the leased goods by making a payment in addition to the payments required under the lease or by satisfying other specified conditions; (bail avec option)

“option price” means the amount of the additional payment that the lessee must make in order to exercise the option under an option lease; (prix de l’option)

“realizable value” , in relation to leased goods, means the actual value of the leased goods at the end of the term and is calculated in accordance with the regulations; (valeur marchande)

“residual obligation lease” means a lease under which the lessee will be required at the end of the term to pay the lessor an amount based wholly or partly on the difference, if any, between the estimated residual value and the realizable value of the leased goods; (bail à obligation résiduelle)

“total lease cost” means the total of any non-refundable payments that the lessee will be required to make in the ordinary course of events. (coût total du bail)

Advertisement for lease

48(1)A lessor shall ensure that an advertisement that is published by or on behalf of the lessor and that gives specific information about the cost of a lease contains the following information respecting the lease:

(a) that the transaction is a lease;

(b) the term;

(c) the nature and amount of any payments that are payable by a lessee at or before the beginning of the term;

(d) the amount, timing and number of the periodic payments;

(e) the nature and amount of any other payments that are payable by a lessee in the ordinary course of events;

(f) the APR; and

(g) the limitations, if any, imposed in accordance with the regulations regarding extra charges that may be charged based on usage of the leased goods.

48(2)Notwithstanding subsection (1), a lessor shall ensure than an advertisement on radio, television, a billboard or another medium with similar time or space limitations that gives any specific information about the cost of a lease

(a) contains the information referred to in paragraphs (1)(a) to (d) and (f), or

(b) contains the information referred to in paragraphs (1)(a), (c) and (d) and states

(i) a telephone number at which the information referred to in paragraphs (1)(b) and (f) is available during the lessor’s normal business hours and may be obtained without incurring any charges for the call, or

(ii) a reference to a written publication having general circulation in the area and containing the information referred to in paragraphs (1)(b) and (f).

48(3)Where any of the information required to be disclosed under subsection (1) would not be the same for all leases to which the advertisement relates, the lessor shall ensure that the information is for a representative transaction and is identified as being for a representative transaction.

48(4)For the purposes of subsection (3), a transaction is a representative transaction if its terms are typical of the terms of the leases to which the advertisement relates.

Initial disclosure statement for lease

49(1)A lessor shall ensure that the initial disclosure statement for a lease contains the following information:

(a) the effective date of the statement;

(b) that the transaction is a lease;

(c) a description of the leased goods;

(d) the term;

(e) the cash value of the leased goods;

(f) the nature and amount of any other advance received, and of each charge incurred, by the lessee in connection with the lease at or before the beginning of the term;

(g) the nature and amount of each payment made by the lessee at or before the beginning of the term;

(h) the capitalized amount;

(i) the amount, timing and number of the periodic payments;

(j) the estimated residual value of the leased goods;

(k) for an option lease,

(i) how and when the option may be exercised,

(ii) the option price if the option is exercised at the end of the term, and

(iii) the method of determining the option price if the option is exercised before the end of the term;

(l) for a residual obligation lease,

(i) the estimated residual cash payment, and

(ii) a statement that the lessee’s maximum liability at the end of the term is the sum of

(A) the estimated residual cash payment, and

(B) the estimated residual value less the realizable value of the leased goods;

(m) the circumstances, if any, under which the lessee or the lessor may terminate the lease before the end of the term and the amount, or the method of determining the amount, of any payment that the lessee will be required to make on early termination of the lease;

(n) if there are circumstances under which the lessee will be required to make a payment in connection with the lease and if that payment is not required to be disclosed under paragraphs (a) to (m),

(i) the circumstances, and

(ii) the amount of the payment or the method of determining the amount;

(o) the implicit finance charge;

(p) the APR; and

(q) the total lease cost.

49(2)The circumstances referred to in paragraph (1)(n) include unreasonable wear or excess use of the leased goods.

Disclosure regarding amendment

50(1)If a lease is amended, the lessor shall, within 30 days after the amendment is made, deliver to the lessee a supplementary disclosure statement that meets the requirements of subsection (2).

50(2)A supplementary disclosure statement referred to in subsection (1) shall set out the information that, as a result of the amendment to the lease, is changed from the initial disclosure statement but need not repeat any information that is unchanged from the initial disclosure statement.

50(3)Where an amendment consists only of a revision to the schedule of payments, a supplementary disclosure statement referred to in subsection (1) need not state any change in the APR or any decrease in the implicit finance charge or the total lease cost.

Maximum liability under residual obligation lease

51The lessee’s maximum liability at the end of the term of a residual obligation lease after returning the leased goods to the lessor shall be calculated in accordance with the regulations.

VIII

INVESTIGATIONS AND INSPECTIONS

Investigations

52The Minister may investigate complaints, made to the Minister in writing, regarding a credit grantor, lessor or credit broker acting as such in the ordinary course of carrying on a business.

Inspections

53(1)The Minister may, during normal business hours, enter upon the business premises of a credit grantor and may inspect any book, record, account or document that, in the opinion of the Minister, relates or may relate to the extension of credit.

53(2)During an inspection under subsection (1), a credit grantor shall produce for inspection any book, record, account or document referred to in subsection (1).

53(3)The Minister may, during normal business hours, enter upon the business premises of a lessor and may inspect any book, record, account or document that, in the opinion of the Minister, relates or may relate to the leasing of goods.

53(4)During an inspection under subsection (3), the lessor shall produce for inspection any book, record, account or document referred to in subsection (3).

53(5)The Minister may, during normal business hours, enter upon the business premises of a credit broker and may inspect any book, record, account or document that, in the opinion of the Minster, relates or may relate to arranging, negotiating or facilitating or attempting to arrange, negotiate or facilitate an extension of credit.

53(6)During an inspection under subsection (5), the credit broker shall produce for inspection any book, record, account or document referred to in subsection (5).

53(7)During an inspection, the Minister may, after giving the credit grantor, lessor or credit broker a receipt to that effect, remove any book, record, account or document in order to examine it or to make a copy or extract of it or any part of it.

53(8)Where the Minister removes any book, record, account or document under subsection (7), the Minister shall, on the request of the credit grantor, lessor or credit broker, and without charge, furnish the credit grantor, lessor or credit broker with a copy of the book, record, account or document.

53(9)A copy or extract of any book, record, account or document related to an inspection and purporting to be certified by the Minister, is admissible in evidence and is proof, in the absence of evidence to the contrary, of the original without proof of the appointment, authority or signature of the Minister.

IX

OFFENCES AND PENALTIES

Offences and penalties

54(1)A person who violates or fails to comply with any provision of the regulations commits an offence punishable under Part II of the Provincial Offences Procedure Act as a category B offence.

54(2)A person who violates or fails to comply with a provision of this Act that is listed in Column I of Schedule A commits an offence.

54(3)For the purposes of Part II of the Provincial Offences Procedure Act, each offence listed in Column I of Schedule A is punishable as an offence of the category listed beside it in Column II of Schedule A.

Limitation period

55A prosecution of an offence under this Act or the regulations shall be commenced within 3 years after the date on which the offence was, or is alleged to have been, committed.

Prosecution of an offence under section 43

56In a prosecution of an offence under section 43, the following is prima facie proof that the credit card issuer issued the credit card to the individual named in the information:

(a) evidence that the name of the accused credit card issuer appears on the face of a credit card alleged to have been issued to the individual named in the information; and

(b) evidence that the name appearing on the face of the credit card as the name of the individual to whom it was issued is the same name as the individual alleged in the information to have been issued the credit card.

Certificate evidence

57(1)A certificate purporting to be signed by a person designated by the Minister and containing the following statements is, without proof of the appointment, authority or signature of the person who has signed the certificate, admissible in evidence, and is, in the absence of evidence to the contrary, proof of the facts stated in the certificate:

(a) that a credit grantor, lessor or credit broker is registered or is not registered under Part II of this Act;

(b) that the registration of a credit grantor, lessor or credit broker under Part II of this Act is suspended or cancelled; or

(c) that a credit grantor, lessor or credit broker has provided or has failed to provide any document required to be provided to the Minister under this Act or the regulations.

57(2)A certificate referred to in subsection (1) shall not be received in evidence unless the party intending to produce it has given the person against whom it is to be produced reasonable notice of the intention, together with a copy of the certificate.

57(3)A person against whom a certificate referred to subsection (1) is produced may, with leave of the court, require the attendance of the person who signed the certificate for the purposes of cross-examination.

X

GENERAL AND ADMINISTRATION

False advertising

58The Minister may order the immediate cessation of the use of any advertisement published by or on behalf of a credit grantor, lessor or credit broker which, in the opinion of the Minister,

(a) in the case of a credit grantor, contains false, misleading or deceptive statements relating to the extension of credit,

(b) in the case of a lessor, contains false, misleading or deceptive statements relating to the leasing of goods,

(c) in the case of a credit broker, contains false, misleading or deceptive statements relating to arranging, negotiating or facilitating or attempting to arrange, negotiate or facilitate an extension of credit, or

(d) is in violation of or fails to comply with this Act or the regulations.

Provision of security by credit grantor, lessor or credit broker

59The Minister may require any credit grantor, lessor or credit broker to provide a bond or collateral security in accordance with the regulations.

Assignees

60An assignee of a credit grantor’s rights under a credit agreement or a lessor’s rights under a lease has no greater rights than the assignor and takes subject to any defence that the borrower or lessee would have had against the assignor.

Administration of this Act

61The Minister is responsible for the administration of this Act and may designate persons to act on the Minister’s behalf.

XI

REGULATIONS

Regulations

62The Lieutenant-Governor in Council may make regulations

(a) defining “high-ratio mortgage” and “mortgage loan” for the purposes of this Act, the regulations or both;

(b) respecting the APR, including the calculation of the APR;

(c) respecting the calculation of the realizable value;

(d) respecting the conditions and assumptions to which the calculation of the total cost of credit or implicit finance charge is subject;

(e) for the purposes of paragraph 1(3)(i), prescribing things that constitute value received or to be received;

(f) for the purposes of paragraph 1(4)(c), prescribing things that do not constitute value received or to be received;

(g) for the purposes of paragraph 1(5)(c), prescribing things that constitute value given or to be given;

(h) for the purposes of section 6, exempting a credit grantor, lessor or credit broker or a class of credit grantors, lessors or credit brokers from the application of Part II;

(i) exempting any credit agreement or lease or any class of credit agreements or leases from the application of this Act or the regulations or any provision of this Act or the regulations;

(j) respecting requirements for registration of credit grantors, lessors or credit brokers;

(k) for the purposes of paragraph 7(2)(d), prescribing information or documents to be supplied by applicants for registration;

(l) prescribing fees for the registration of a credit grantor, lessor or credit broker for the purposes of paragraph 7(2)(e) and prescribing fees for other matters or services supplied by the Minister under this Act or the regulations;

(m) for the purposes of section 8, prescribing the period of time during which the registration of a credit grantor, lessor or credit broker remains in effect;

(n) respecting terms and conditions on the registration of a credit grantor, lessor, credit broker or on the suspension or cancellation of the registration of a credit grantor, lessor or credit broker;

(o) respecting the suspension, cancellation or withdrawal of the registration of a credit grantor, lessor or credit broker;

(p) respecting certificates of registration for a credit grantor, lessor or credit broker;

(q) prescribing expenses, charges or fees for the purposes of paragraph 16(3)(a) or (b);

(r) for the purposes of subsection 16(4), respecting the waiver by a borrower of the time period referred to in subsection 16(3), including the terms and conditions on such waiver;

(s) prescribing notices or documents for the purposes of subsection 19(3);

(t) for the purposes of subsection 23(4), respecting the calculation of the portion of each non-interest finance charge that shall be refunded or credited to the borrower;

(u) respecting the limitation of extra charges that may be charged based on usage of leased goods;

(v) for the purposes of section 51, respecting the calculation of the lessee’s maximum liability at the end of the term of a residual obligation lease after returning the leased goods to the lessor;

(w) for the purposes of section 59, respecting any bond or collateral security that the Minister may require to be provided by a credit grantor, lessor or credit broker, including the forfeiture of such bond or collateral security and the disposition of the proceeds of the forfeiture of such bond or collateral security;

(x) respecting communications, contacts, attempted communications or attempted contacts between a credit grantor or lessor and any other person for the purpose of the collection or recovery of a debt owed to a credit grantor by a borrower or to a lessor by a lessee, including prohibiting or limiting such communications, contacts, attempted communications or attempted contacts;

(y) respecting the collection or recovery of a debt owed to a credit grantor by a borrower or to a lessor by a lessee;

(z) respecting the compensation or penalties payable by a lessee on the early termination of a lease;

(aa) respecting the circumstances under which a credit grantor may accelerate payment by the borrower so as to require payment of the outstanding balance of a credit agreement, other than a credit agreement in relation to a mortgage loan;

(bb) respecting forms to be used for the purposes of this Act or the regulations;

(cc) defining any word or expression used but not defined in this Act for the purposes of this Act, the regulations or both;

(dd) generally for the better administration of this Act.

XII

TRANSITIONAL

Registrations under the previous Act

63(1)In this section

“previous Act” means the Cost of Credit Disclosure Act, chapter C-28 of the Revised Statutes, 1973, as it existed immediately before the commencement of this Act, and New Brunswick Regulation 83-180 as that regulation existed immediately before the commencement of this Act. (loi antérieure)

63(2)A registration granted under the previous Act and in effect immediately before the commencement of this Act shall be deemed to be a registration under Part II of this Act, and the registration remains in effect, unless withdrawn, suspended or cancelled under this Act, until such time as the registration would have expired under the previous Act.

Existing credit agreements

64(1)Sections 2, 18, 19, 20, 21, 22, 23, 24, 25, 36, 37, 42 and 46 apply in respect of any credit agreement entered into by a credit grantor in the ordinary course of carrying on a business before the commencement of this Act.

64(2)For the purposes of subsection (1), paragraph 42(1)(a) shall be read as follows:

(a) the period covered by the statement, which period shall run from the commencement of this Act, or if a statement of account has been delivered under this section, from the date of the statement of account most recently delivered to the borrower;

Existing leases

65Sections 2, 21 and 22, paragraphs 24(1)(a) and (c), subsection 24(3) and section 25 apply in respect of any lease entered into by a lessor in the ordinary course of carrying on a business before the commencement of this Act.

XIII

CONSEQUENTIAL AMENDMENTS

Consumer Product Warranty and Liability Act

66Section 20 of the Consumer Product Warranty and Liability Act, chapter C-18.1 of the Acts of New Brunswick, 1978, is repealed and the following is substituted:

20(1)The buyer may reject the product under section 16 notwithstanding that the buyer has granted a security interest in the product to a third person, unless the amount outstanding on the security agreement exceeds any amount that the buyer is entitled to recover from the seller under section 17.

20(2)Where the buyer has granted a security interest in the product to a third person, the seller may exercise the buyer’s rights under section 23 of the Cost of Credit Disclosure Act on behalf of the buyer.

20(3)The buyer is liable to the seller for any payments, except finance charges, that the seller makes under subsection (2) and the seller may treat such payments as a refund of payments to the buyer for the purposes of sections 17 and 18.

Direct Sellers Act

67Subparagraph 9(1)j)(ii) of the French version of Regulation 84-151 under the Direct Sellers Act is amended by striking out “divulgation du coût du crédit conformément à la Loi sur la divulgation du coût du crédit” and substituting “communication du coût du crédit conformément à la Loi sur la communication du coût du crédit”.

XIV

REPEAL

Cost of Credit Disclosure Act

68(1)The Cost of Credit Disclosure Act, chapter C-28 of the Revised Statutes, 1973, is repealed.

68(2)New Brunswick Regulation 83-180 under the Cost of Credit Disclosure Act is repealed.

XV

COMMENCEMENT

Commencement

69This Act or any provision of it comes into force on a day or days to be fixed by proclamation.

SCHEDULE A

Column I Section		Column II Category of Offence
Column I Section		Column II Category of Offence

	6(1)..............		D
	6(2)..............		D
	6(3)..............		D
	6(4)..............		D
	10(1)(a)..............		D
	10(1)(b)..............		D
	10(2)(a)..............		D
	10(2)(b)..............		D
	10(3)(a)..............		D
	10(3)(b)..............		D
	15(2)..............		D
	15(3)..............		D
	16(1)..............		D
	16(2)..............		D
	16(3)..............		D
	17..............		D
	18(1)..............		D
	19(4)..............		D
	21(2)..............		D
	23(3)..............		D
	24(1)..............		D
	26(5)..............		D
	27(2)..............		D
	27(3)..............		D
	27(9)..............		D
	29..............		D
	30(2)..............		D
	30(3)..............		D
	30(5)..............		D
	32(1)..............		D
	32(2)..............		D
	33(1)..............		D
	33(2)..............		D
	34(1)..............		D
	35(2)..............		D
	36(1)..............		D
	36(2)..............		D
	36(3)(a)..............		D
	36(5)..............		D
	37..............		D
	39(1)..............		D
	39(2)..............		D
	41(1)..............		D
	42(1)..............		D
	42(3)..............		D
	43..............		D
	44(1)..............		D
	44(3)..............		D
	44(5)..............		D
	45(1)(a)..............		D
	45(1)(b)..............		D
	45(2)(a)..............		D
	45(2)(b)..............		D
	48(1)..............		D
	48(2)..............		D
	48(3)..............		D
	49(1)..............		D
	50(1)..............		D
	53(2)..............		D
	53(4)..............		D
	53(6)..............		D

N.B. This Act is consolidated to June 22, 2006.

C-28.3 - Cost of Credit Disclosure and Payday Loans Act

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