d-7 - Act respecting municipal debts and loans

Updated to 18 December 2003

This document has official status.

chapter D-7

Act respecting municipal debts and loans

1988, c. 84, s. 579.

DIVISION I TERM OF MUNICIPAL DEBTS

1. The term for repayment of a loan effected by a municipality may not exceed 40 years nor the useful life of the property that the proceeds of the loan enable the municipality to acquire, repair, restore or build.

R. S. 1964, c. 171, s. 1; 1977, c. 5, s. 14; 1984, c. 38, s. 145; 1992, c. 54, s. 68; 1994, c. 33, s. 45; 1996, c. 2, s. 622; 1999, c. 43, s. 13; 2003, c. 19, s. 183.

2. A municipality may, by resolution, issue bonds, notes or other securities for shorter terms than the term originally fixed, and may establish a sinking-fund at a rate based on the term of the loan, provided that each issue subsequent to the first one be only for all or part of the balance of the loan.

Notwithstanding section 1 or any general law or special Act, when new bonds or new notes or other securities are issued to pay all or part of the balance of a loan the securities for which were issued for shorter terms than the term originally fixed, the municipality may, by resolution, extend such term by a maximum of twelve months at the time of each issue of new bonds or new notes or other securities.

A municipality may also, if authorized by a by-law requiring no other approval than that of the Minister of Municipal Affairs, Sports and Recreation, borrow the necessary sums of money to meet the cost of printing and sale of the bonds, notes or other securities of a subsequent issue contemplated in the second paragraph.

Where it is necessary to provide for the payment, before maturity, of bonds, notes or other securities authorized by a loan by-law, a municipality may, within six months preceding the maturity date of such negotiable instruments, borrow, by way of a new issue of bonds, notes or other securities made pursuant to the same loan by-law, the sums necessary for the payment less the sums already paid for that purpose into a sinking-fund. The reimbursement period applicable to the anticipated loan shall be extended by the number of unexpired days in the reimbursement period applicable to the previous loan.

Notwithstanding any general law or special Act, this section applies to every body the loans of which must be approved by the Minister of Municipal Affairs, Sports and Recreation.

The council of a local municipality with a population of 100,000 or more may, by by-law, delegate to the treasurer the exercise of the powers granted under the first, second and fourth paragraphs.

R. S. 1964, c. 171, s. 2; 1966-67, c. 54, s. 1; 1973, c. 33, s. 1; 1977, c. 5, s. 14; 1983, c. 57, s. 105; 1984, c. 38, s. 145; 1987, c. 42, s. 9; 1999, c. 31, s. 13; 1999, c. 43, s. 13; 2003, c. 19, s. 184, s. 250.

DIVISION II CONSOLIDATION OF MUNICIPAL DEBTS

3. A municipality may, by a by-law requiring only the approval of the Minister of Municipal Affairs, Sports and Recreation, borrow to make up a deficit, in accordance with the Act governing the municipality.

R. S. 1964, c. 171, s. 3; 1973, c. 33, s. 2; 1977, c. 5, s. 14; 1984, c. 38, s. 146; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

DIVISION III PAYMENT OF MUNICIPAL LOANS BY ANNUITIES

4. Any municipality, in a by-law authorizing any loan which it may lawfully make under the law by which it is governed, may stipulate that it will repay such loan by annuities extending over a term of not more than that authorized by law.

R. S. 1964, c. 171, s. 4.

5. Such annuities shall include the interest and the portion of the capital which is to be annually paid to extinguish the debt at the time agreed upon.

R. S. 1964, c. 171, s. 5.

6. Any such municipality may, for the payment of such annuities, issue debentures payable every six months or every year until the loan is extinguished.

R. S. 1964, c. 171, s. 6.

DIVISION IV APPLICATION OF MONEYS REALIZED FROM MUNICIPAL LOANS

7. The moneys realized from a loan made by any municipality shall be applied exclusively to the purposes for which they are intended. If they exceed the amount required for such purposes, the excess may be applied to other purposes specified in a subsequent by-law, approved in the same manner as a loan by-law in accordance with the Act governing the municipality.

R. S. 1964, c. 171, s. 7; 1973, c. 33, s. 3; 1984, c. 38, s. 147; 1996, c. 2, s. 635.

8. Any excess referred to in section 7 may also be applied to the following purposes:

(1)  the redemption before maturity of bonds issued at the time of the loan, as the case may be, in accordance with Division VII;

(2)  the payment of amounts due annually at maturity to repay the loan, in capital and interest;

(3)  the reduction of the balance of the loan, if the bonds, notes or other securities have been issued for shorter terms than the term originally fixed, in accordance with section 2, or the payment of expenditures caused by the issue of new bonds, or new notes or other securities to pay such balance.

If the loan is entirely repaid and an excess remains, the excess shall be paid into the general fund of the municipality.

If a sum is used for the purposes of subparagraph 2 of the first paragraph, the rate of the tax imposed to pay the amounts due at maturity, and for which the sum is used, is reduced so that the anticipated revenues from that tax are equal to the balance payable after the application of subparagraph 2 of the first paragraph.

The resolution or by-law under which the municipality exercises a power under this section does not require any approval.

R. S. 1964, c. 171, s. 8; 1973, c. 33, s. 4; 1977, c. 5, s. 14; 1984, c. 38, s. 147; 1992, c. 27, s. 66; 1996, c. 2, s. 635.

9. Every member of the council who, either verbally or in writing, by his vote or tacitly, authorizes the misapplication of such money, shall be personally responsible towards the municipality for all sums thus illegally diverted from the use for which they are intended.

R. S. 1964, c. 171, s. 9; 1990, c. 4, s. 381; 1996, c. 2, s. 635.

10. Such responsibility shall be joint and several, and shall apply to the secretary-treasurer or other officer who causes any such illegal diversion of moneys, or takes any part therein.

R. S. 1964, c. 171, s. 10.

11. The action to recover such moneys may likewise be taken by any ratepayer or by the Minister of Municipal Affairs, Sports and Recreation.

R. S. 1964, c. 171, s. 11; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

DIVISION V SPECIAL PROVISIONS RESPECTING NEGOTIABLE INSTRUMENTS ISSUED BY MUNICIPALITIES

1995, c. 34, s. 70.

12. Every bond of a municipality shall, before its delivery, bear a certificate of the Minister of Municipal Affairs, Sports and Recreation, or of a person specially authorized by him, establishing that the by-law or resolution authorizing its issue has received every required approval.

Every bond of a municipality bearing the certificate contemplated in the first paragraph is valid, and its validity shall not be contested for any cause whatsoever.

This section also applies to every other negotiable instrument the reimbursement of which must be effected in foreign currency.

Notwithstanding any general law or special Act, this section applies to every body the loans of which must be approved by the Minister of Municipal Affairs, Sports and Recreation.

R. S. 1964, c. 171, s. 12; 1973, c. 33, s. 5; 1976, c. 52, s. 18; 1977, c. 5, s. 14; 1984, c. 38, s. 148; 1995, c. 34, s. 71; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

12.1. The certificate mentioned in section 12 may be issued under a facsimile of the signature of the Minister or of the authorized person. However, the presumption of validity set out in the said section shall not apply, where the certificate is issued under a facsimile of the signature, unless the bonds bear the manual signature of the authorized member of the council, or of the officer or financial agent mandated by the municipality.

1994, c. 33, s. 46.

12.2. A note of $100,000 or more or a note issued following a call for tenders may bear the certificate mentioned in section 12.

1995, c. 34, s. 72.

12.3. The incontestability set out in section 12 applies to every note even where it does not bear the certificate mentioned in that section.

1995, c. 34, s. 72.

13. (Repealed).

R. S. 1964, c. 171, s. 13; 1996, c. 27, s. 147; 1997, c. 53, s. 38.

14. All salaries and fees established by or recovered under such regulations shall form part of the Consolidated Revenue Fund of Québec.

R. S. 1964, c. 171, s. 14; 1990, c. 4, s. 382.

DIVISION VI LOANS IN FOREIGN CURRENCY AND INSTRUMENTS AND CONTRACTS OF A FINANCIAL NATURE

1992, c. 18, s. 3.

15. When a municipality wishes to contract a loan from a money market other than the Canadian market or which is to be repaid in whole or in part in foreign currency, such municipality must previously be authorized to do so by the Minister of Finance and the Minister of Municipal Affairs, Sports and Recreation. Furthermore, the execution of any registration formality allowing access to a money market other than the Canadian market and any negotiation in respect of a loan contemplated in this paragraph must previously be authorized by the Minister ofFinance and the Minister of Municipal Affairs, Sports and Recreation.

Every municipality may empower any person it designates to apply for an authorization provided for in the first paragraph.

Whenever such authorization has been given and the municipality has contracted a loan by complying with the legislative provisions governing it in that respect and that the Act, by-law or resolution authorizing the loan limits the amount thereof, such amount shall be deemed to be the nominal value of the bonds or other securities issued in connection with such loan, regardless of any premium that may be payable on redemption and regardless of the fact that such bonds or other securities may be sold at a premium or discount; and the loan shall be deemed to have been authorized in both foreign and Canadian currency, notwithstanding any difference in value existing between them at the time of the loan or after the same has been effected.

Notwithstanding any provision of a general law or special Act, a loan referred to in the first paragraph requires no authorization by the Minister of Municipal Affairs, Sports and Recreation other than the authorizations provided for in that paragraph, and no subsequent approval by that Minister.

R. S. 1964, c. 171, s. 15; 1972, c. 60, s. 36; 1977, c. 5, s. 14; 1982, c. 63, s. 188; 1984, c. 27, s. 59; 1988, c. 84, s. 580; 1995, c. 34, s. 73; 1996, c. 2, s. 623; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

15.1. The Government may, by regulation, determine the nature and the form of the information to be given to the Minister of Finance and to the Minister of Municipal Affairs, Sports and Recreation, for the purposes of the carrying out of the first paragraph of section 15, as well as the time when the information must be given.

Such a regulation comes into force on the date of its publication in the Gazette officielle du Québec or on any later date fixed therein.

1982, c. 63, s. 189; 1988, c. 84, s. 581; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

15.2. Where a municipality effects a loan in a foreign country, it may elect domicile in that country or elsewhere, for the purposes of receiving a notice or proceeding respecting that loan.

In the same circumstances, the municipality may order that the securities issued by it or the contracts entered into by it in a foreign country for the purposes of the loan be governed by the law of that country, provided that the statutes of Québec respecting municipal loans are complied with.

1982, c. 63, s. 189; 1996, c. 2, s. 635.

15.3. A municipality may, with the authorizations required by law for the exercise of its borrowing power, conclude any currency exchange agreement or interest rate exchange agreement or terminate such an agreement according to its terms.

1992, c. 18, s. 4.

15.4. In addition to the powers granted to it under section 15.3, a municipality may, with the authorizations required by law for the exercise of its borrowing power, enter into transactions in respect of instruments or contracts of a financial nature which the Government may determine for one or several municipalities or for a category of municipalities.

1992, c. 18, s. 4.

15.5. Transactions carried out within the framework of a program established by a municipality and approved by the Government are not subject to the authorizations required by sections 15.3 and 15.4 where the program establishes the principal compulsory characteristics of the transactions and limits the financial commitments which may result from them.

1992, c. 18, s. 4.

15.6. The Government may, in respect of those instruments and contracts of a financial nature which it determines and in respect of currency exchange agreements or interest rate exchange agreements, exempt one or several municipalities or a category of municipalities, with or without conditions, from the obligation to obtain the authorizations required by sections 15.3 and 15.4.

1992, c. 18, s. 4.

15.7. For the purposes of sections 15.3 to 15.6, “instruments or contracts of a financial nature” means any financial instrument or contract whose object is the management of financial risks, in particular currency exchange agreements, interest rate exchange agreements, options and futures contracts.

1992, c. 18, s. 4.

DIVISION VII LOANS REDEEMABLE BY ANTICIPATION

16. (Repealed).

R. S. 1964, c. 171, s. 16; 1972, c. 60, s. 37; 1977, c. 5, s. 14; 1988, c. 84, s. 582; 1996, c. 2, s. 624.

17. It is, and always has been, lawful for any municipality to stipulate, in a procedure it is authorized to adopt for the effecting of a loan, that the bonds or debentures issued shall be redeemable, before their respective dates of maturity, at the times and upon the conditions determined in such procedure and at a price not lower than their face value. The right of redemption must be mentioned on the bonds or debentures, otherwise it cannot be exercised against the will of the holders.

R. S. 1964, c. 171, s. 17; 1988, c. 84, s. 583; 1996, c. 2, s. 635.

18. The bonds or debentures thus redeemable may, at the will of the municipality, be redeemed by anticipation at any interest maturity date by complying with the conditions determined at the time of their issue and, in all cases, by giving notice once in the Gazette officielle du Québec not less than 30 days, nor more than 60 days before the date of redemption, and by posting up or publishing such notice in the manner prescribed for the public notices of such municipality.

The same notice must, within the same time, be sent by registered or certified mail to the last known address of every registered holder of a bond or debenture ordered to be redeemed.

R. S. 1964, c. 171, s. 18; 1975, c. 83, s. 84; 1996, c. 2, s. 635; 1999, c. 40, s. 103.

19. Any bond or debenture, the redemption whereof is ordered in conformity with the hereinabove mentioned provisions, shall cease to bear interest from the date of redemption determined in the notices if, at such date, the required sum was available at the place of payment.

R. S. 1964, c. 171, s. 19.

20. A municipality may, by a by-law requiring only the approval of the Minister of Municipal Affairs, Sports and Recreation, effect any loan required for redemption under this division.

The amount of such loans shall not exceed the face value of the bonds or debentures to be redeemed.

R. S. 1964, c. 171, s. 20; 1977, c. 5, s. 14; 1981, c. 27, s. 22; 1984, c. 38, s. 149; 1988, c. 84, s. 584; 1996, c. 2, s. 635; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

DIVISION VIII PERSONAL GUARANTEE PROHIBITED

21. In this division:

(1)  (paragraph repealed);

(2)  the word “officer” means any member of a municipal council and likewise includes every officer or employee of a municipality.

R. S. 1964, c. 171, s. 21; 1972, c. 60, s. 38; 1977, c. 5, s. 14; 1988, c. 84, s. 585; 1996, c. 2, s. 625.

22. No officer of a municipality shall, subject to nullity, become guarantor or make himself personally responsible, directly or indirectly, for such municipality.

Every agreement or undertaking contrary to the provisions of this section shall be without effect.

R. S. 1964, c. 171, s. 22; 1999, c. 40, s. 103.

DIVISION VIII.1 BONDS ISSUED UNDER SPECIAL CONDITIONS AND REPLACEMENT OF BONDS

1997, c. 53, s. 39.

22.1. A municipality may, on the conditions determined by the Minister of Municipal Affairs, Sports and Recreation and within a framework approved by the Government, issue bonds using a procedure different from the procedure prescribed in a provision of an Act or regulation applicable to municipal bonds, or substitute such bonds for all or any portion of bonds issued otherwise.

1997, c. 53, s. 39; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

22.2. A municipality may, on the conditions determined by the Minister of Municipal Affairs, Sports and Recreation, substitute a bond issued using a procedure prescribed in a legislative or regulatory provision other than section 22.1 applicable to the municipality, for several bonds issued using that procedure.

1997, c. 53, s. 39; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

DIVISION IX REGISTRATION OF DEBENTURES

23. Every municipality shall keep a register for the registration of the debentures issued for borrowing purposes.

R. S. 1964, c. 171, s. 23; 1972, c. 60, s. 39; 1977, c. 5, s. 14; 1988, c. 84, s. 586; 1996, c. 2, s. 635.

24. The clerk, secretary or secretary-treasurer of the municipality shall enter in such register, upon the request of the original holder or of any transferee of a debenture issued by the municipality, his name and address, the amount, the date of issue and the number of such debenture, as well as the date of the registration.

He shall also, under his signature, enter on the debenture itself the name and address of the person in favour of whom it is registered, as well as the date of such registration.

R. S. 1964, c. 171, s. 24; 1996, c. 2, s. 635.

25. The entry in such register of the name of the last person appearing therein as holder or transferee of a debenture shall constitute evidence of his right of ownership of such debenture until proof to the contrary.

Such register may be examined by any person applying therefor, during the office hours of the municipality.

R. S. 1964, c. 171, s. 25; 1996, c. 2, s. 635.

25.1. Every municipality may enter into an agreement by which it entrusts to a person the responsibility of keeping the register provided for in section 23.

The agreement must designate the person responsible for performing the duties which are imposed by sections 24 and 25 on the clerk, the secretary or the secretary-treasurer of the municipality, as the case may be.

1995, c. 34, s. 74.

26. Any municipality may, by resolution, before issuing debentures for the purposes of a loan repayable in foreign currency, authorize a person whom it designates to keep, outside Québec, in its place and stead, a register to be used for recording the names and addresses of the original holders or of the transferees of such debentures, the amount, date of issue and serial numbers of such debentures and the date when the entry is made in the register.

Sections 23 to 25 do not apply in the case provided for in this section.

1968, c. 50, s. 1; 1972, c. 60, s. 40; 1976, c. 39, s. 11; 1977, c. 5, s. 14; 1984, c. 38, s. 150; 1988, c. 84, s. 587; 1996, c. 2, s. 635.

26.1. (Repealed).

1981, c. 27, s. 23; 1988, c. 84, s. 588.

DIVISION X TRANSFER OF DEBENTURES

27. Any debenture payable to bearer may be transferred by delivery.

Any debenture payable to any person designated therein, or to any person or order, may be transferred by endorsement or delivery.

R. S. 1964, c. 171, s. 26; 1983, c. 57, s. 106.

28. Where a debenture is registered in the name of a person under Division IX, it may be transferred only if the registration is corrected so that the name of the transferee is specified thereon or so that it is indicated that the debenture is payable to bearer.

That condition is added to the transfer procedure mentioned in section 27.

R. S. 1964, c. 171, s. 27; 1983, c. 57, s. 106.

29. Any transfer carried out in accordance with section 27, or section 28 where such is the case, shall vest the property of the debenture in the transferee and entitle him to take an action thereupon in his own name.

In any such action, it is not necessary to set forth or to prove the mode by which a person became the holder of the debenture, or to set forth or to prove the notices, by-laws, or other proceedings under or by virtue of which the debenture was issued. It shall be sufficient to describe the plaintiff or applicant as the holder of the debenture alleging the general endorsement or the registration required by sections 27 and 28, if any, and shortly to state its legal effect and purport, and to make proof accordingly.

R. S. 1964, c. 171, s. 28; 1983, c. 57, s. 106.

30. Subject to the provisions of section 547 of the Cities and Towns Act (chapter C-19), regarding a sinking fund, in the case of municipalities subject thereto, any debenture issued by any municipality shall be valid and recoverable to the full amount thereof, notwithstanding its negotiation by such municipality at a rate less than par, and shall not be impeachable for such reason in the hands of a holder of value.

R. S. 1964, c. 171, s. 29; 1996, c. 2, s. 626.

31. Where the interest for one year or more on a debenture, or the principal of one of a series of debentures, issued under a loan by-law, has been paid by the municipality which has issued such debentures, the by-law authorizing such issue, and the debentures issued thereunder, shall thereupon become valid and binding upon such municipality.

R. S. 1964, c. 171, s. 30; 1996, c. 2, s. 627.

32. (Repealed).

R. S. 1964, c. 171, s. 31; 1996, c. 2, s. 628.

33. (Repealed).

R. S. 1964, c. 171, s. 32; 1990, c. 4, s. 383; 1992, c. 61, s. 260; 1996, c. 2, s. 628.

DIVISION XI SINKING FUNDS

34. When the principal of a loan contracted, or of bonds issued, by a municipality is repayable by annuity instalments or by a series of consecutive and yearly instalments covering the whole term of the loan or of the bond issue, the moneys set aside each year for the sinking fund shall be sufficient to meet each instalment, and shall be used for such purpose at each date on which an instalment becomes due.

When such principal is repayable otherwise, the moneys intended for the sinking fund shall be sufficient every year, with the interest accrued thereon, to pay the whole of the capital at maturity, and shall be deposited every year in the office of the Minister of Finance, at Québec, and so much of said deposit as may be required shall be used to meet instalments, if any, at the dates on which they respectively fall due.

R. S. 1964, c. 171, s. 33; 1996, c. 2, s. 629.

35. The Government, upon the report of the Minister of Municipal Affairs, Sports and Recreation to the effect that it is advisable and in the interest of the municipality that the sinking-fund be deposited elsewhere than in the office of the Minister of Finance, or be otherwise invested, may authorize that the sinking-fund required to redeem an issue of bonds made, or to repay a loan contracted, by that municipality, be deposited elsewhere than in the office of the Minister of Finance or be otherwise invested.

R. S. 1964, c. 171, s. 34; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

36. A municipality which has effected a loan for which a sinking fund must be created under the laws governing the same, or which has issued bonds, shall, within the 30 days immediately following the completion of the loan, or the delivery of the bonds, make to the Minister of Finance a report, under the oath of office of the mayor and that of the secretary-treasurer or clerk.

Such report shall set forth:

(1)  the particulars of the by-law or resolution under which the loan was contracted or the bonds were issued;

(2)  the amount of the loan or of the bonds, the amount of each instalment, if any, the maturity dates and the places of payment of the principal;

(3)  the date of the completion of the loan or of the delivery of the bonds, the name of the lender or purchaser, and the net amount received by the municipality out of the money borrowed or out of the sale of the bonds.

Such report shall be accompanied by a certified copy of the by-law or resolution, as the case may be.

R. S. 1964, c. 171, s. 35; 1972, c. 60, s. 41; 1977, c. 5, s. 14; 1988, c. 84, s. 589; 1996, c. 2, s. 630.

37. The moneys deposited in conformity with this division shall bear interest, compounded yearly, from the date of their deposit, at a rate which the Government may fix from time to time and which shall not be less than one and one-half per cent per annum nor more than three and one-half per cent per annum.

At maturity of the loan or of the bonds, such moneys, together with the interest accrued, shall be paid over, by the Ministère des Finances, to the order of the bank or banks where the loan or the bonds are payable.

R. S. 1964, c. 171, s. 36; 1966-67, c. 54, s. 2; 1977, c. 5, s. 14.

38. The moneys deposited in conformity with this division and the interest accrued thereon shall be unseizable, save and except in execution of a final judgment from a competent court rendered in favor of the lender, or of one or more of the bondholders, for whose benefit the sinking fund has been created.

The moneys seized shall be distributed rateably amongst all the holders of the bonds.

R. S. 1964, c. 171, s. 37.

39. The moneys deposited with the Minister of Finance in conformity with this division, may be invested in stock or bonds of Canada or of a Province, in public securities of the United Kingdom or of the United States of America, or in the stock or bonds of any municipality or school board in Québec or of the Comité de gestion de la taxe scolaire de l’île de Montréal.

R. S. 1964, c. 171, s. 38; 1996, c. 2, s. 631; 2002, c. 75, s. 33.

40. Sections 10 to 16 of the Deposit Act (chapter D-5) shall apply to this division.

R. S. 1964, c. 171, s. 39; 1970, c. 17, s. 101.

41. The Government may make such regulations as it may deem proper, concerning the formalities to be followed in connection with this division. It may also establish a tariff of duties and fees payable by the interested municipalities, in connection with the deposits and their reimbursement.

R. S. 1964, c. 171, s. 40; 1996, c. 2, s. 635.

42. The mayor, secretary-treasurer or clerk of a municipality who refuses or neglects to comply with the provisions of section 36 or with the regulations made under section 41, or who gives false or obviously insufficient information, shall be liable to a fine of not less than $50, nor more than $500.

R. S. 1964, c. 171, s. 41; 1972, c. 60, s. 42; 1977, c. 5, s. 14; 1988, c. 84, s. 590.

43. All provisions of law inconsistent with those enacted by this division shall be construed so as to give to this division its full force and effect.

R. S. 1964, c. 171, s. 42.

44. (Repealed).

R. S. 1964, c. 171, s. 43; 1981, c. 27, s. 24; 1988, c. 84, s. 591.

45. Any provision in any special Act to the contrary notwithstanding, any local municipality which has contracted a loan by an issue of bonds, without the by-law authorizing such loan making provision for the collection of a sinking fund, may, by by-law, impose a special tax for the purpose of creating a sinking fund to repay such loan at maturity.

No by-law passed under this section shall be submitted to the approval of the qualified voters, but must be approved by the Government.

The sinking fund collected under any by-law passed under the authority of this section, must be deposited in the office of the Minister of Finance in conformity with the provisions of sections 34 to 42.

R. S. 1964, c. 171, s. 44; 1987, c. 57, s. 794; 1996, c. 2, s. 632.

46. Whenever a municipality has contracted a loan, with respect to which it is bound to invest a sinking fund, it may use such sinking fund to redeem the bonds issued by it for such loan, provided that the interest on the debentures so redeemed be in future employed in the same manner as the sinking fund.

R. S. 1964, c. 171, s. 45; 1996, c. 2, s. 635.

47. In each of the following cases, namely:

(1)  whenever a municipality, contracting any loan which it is authorized to make under its charter or the general law, has not provided for the creation of a sinking fund for such loan, whether or not its charter or the general law has authorized the creation of such fund; or

(2)  whenever a municipality which has contracted a loan and has provided for the creation of a sinking fund, has not levied the same at a rate sufficient to form the sinking fund required to repay the said loan at maturity; or has used for other purposes either the whole or any part of the money collected for the sinking fund,

Such municipality may,

(a)  provide, by by-law, for the creation of a sinking fund to repay the loan, at maturity, and for levying upon the taxable immovable property of a tax sufficient for such purpose; or

(b)  provide, by by-law, for the collection, by one or more levies upon all the taxable property in the territory of the municipality, of an amount sufficient to make good the deficit in any sinking fund already accumulated, wholly or in part, but a part of which has been diverted to other uses; or

(c)  borrow, by by-law, for one or other of the purposes mentioned in subparagraphs a and b, in accordance with the provisions applicable to loans by such municipality.

Only a local municipality may exercise the powers provided for in subparagraphs a and b of the second paragraph.

R. S. 1964, c. 171, s. 46; 1996, c. 2, s. 633.

48. The moneys intended for the sinking fund under section 47 shall be subject to the provisions of sections 34 to 42.

R. S. 1964, c. 171, s. 47.

48.1. Notwithstanding any contrary provision in a general law or special Act, a municipality may effect loans, by way of an issue of bonds, up to a sum not exceeding 50% of the annual amounts due and required for its sinking-fund or for the payment of the annual amounts in capital due at maturity in respect of previous loans by means of bonds.

Every by-law ordering loans under this section requires only the approval of the Minister of Municipal Affairs, Sports and Recreation.

No loan under this section may be contracted for a period exceeding 20 years.

1984, c. 38, s. 151; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

DIVISION XII CONVENTIONS WITH CREDITORS OF MUNICIPALITIES

1984, c. 38, s. 152.

49. A municipality may, by by-law, authorize the making of a convention with all its creditors or creditors to whom it is indebted under one or more loan by-laws.

A convention under the first paragraph shall take effect provided it has been ratified by two-thirds of the creditors contemplated in it and the Minister of Municipal Affairs, Sports and Recreation has approved the by-law authorizing it.

The convention shall be binding on all the creditors contemplated in it.

If the by-law authorizing the convention orders a loan for the purposes of this section, it shall require only the approval of the Minister of Municipal Affairs, Sports and Recreation.

R. S. 1964, c. 171, s. 48; 1984, c. 38, s. 152; 1999, c. 43, s. 13; 2003, c. 19, s. 250.

49.1. Where a municipality is indebted to the Government under a loan contracted by the municipality, the Government and the municipality may make a convention in respect of that loan, notwithstanding the by-law that authorized the loan and notwithstanding any provision of a general law or special Act.

1984, c. 38, s. 152.

DIVISION XIII RATE OF INTEREST

50. The Government may fix from time to time the maximum rate of interest that a municipality may pay on a loan, whatever be the Act that governs it and notwithstanding any inconsistent provision of any such Act; such order of the Government shall have effect from the date of its publication in the Gazette officielle du Québec, or from such later date as is fixed therein.

R. S. 1964, c. 171, s. 49; 1966-67, c. 54, s. 3.

51. (Repealed).

1966-67, c. 54, s. 3; 1984, c. 38, s. 153.

DIVISION XIV

This Division ceased to have effect on 17 April 1987.

52. (This section ceased to have effect on 17 April 1987).

1982, c. 21, s. 1; U. K., 1982, c. 11, Sch. B, Part I, s. 33.

FORM

1Repealed.

R. S. 1964, c. 171, form 1; 1996, c. 2, s. 634.

REPEAL SCHEDULE

In accordance with section 17 of the Act respecting the consolidation of the statutes (chapter R-3), chapter 171 of the Revised Statutes, 1964, in force on 31 December 1977, is repealed effective from the coming into force of chapter D-7 of the Revised Statutes.