An Act to enable Banks in any part of Canada to use Notes of the Dominion instead of issuing Notes of their own

CAP. XLVI.

An Act to enable Banks in any part of Canada to use Notes of the Dominion instead of issuing Notes of their own.

[Assented to 22nd May, 1668.]

Preamble.

Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

Governor in in Council may arrange with Banks for surrender of power to issue notes.1. The Governor in Council may enter into arrangements with all or any of the Chartered Banks in this Dominion for the surrender, on or before the first day of June, one thousand eight hundred and seventy, of their power to issue notes;—Compensation to be paid.and in compensation for such surrender, an annual sum not exceeding five per cent upon the amount of its circulation, as established with respect to any Bank in the Province of Quebec or Ontario, by the monthly return upon the thirtieth day of April, one thousand eight hundred and sixty-six, and with respect to any Bank in Nova Scotia or New Brunswick, and to any Bank in the late province of Canada, incorporated since the said last mentioned day,—in such manner as the Governor in Council may deem satisfactory, shall be payable by the Dominion to each Bank so surrendering its power of issue and redeeming its notes in circulation, until the expiration of its charter, or such other period as Parliament may appoint; Exchange of Govt. securities for Provincial Notes.and the Receiver General Exchange of shall receive any Provincial Debentures or other government securities now held by any such Bank in compliance with the requirements of its charter, in exchange for Notes of the Dominion; and shall also pay to such Bank one half the estimated cost of its unissued notes.

Surrender may be gradual or immediate.2. In entering into any such arrangement as aforesaid with any Bank, the Governor in Council may provide either for the immediate or the gradual surrender of its power to issue notes, such gradual surrender not extending over a period of more than twelve months; Exchange of certain Debentures for Dominion Notes.but in such case the exchange of Dominion Notes for such Debentures and government securities as aforesaid, held by the Bank under the requirements of its charter, shall be made only in equal proportion to the amount of its notes actually redeemed and withdrawn from circulation, as shewn by its monthly returns.

No obligation to hod debentures after surrender.3. From the date of any such arrangement with any Bank, it shall no longer be bound to hold any Provincial Debentures or other government securities which it may be now required by law to hold.

Weekly returns to the Auditor; and payment of compensation, half yearly.4. Every Bank so surrendering its power to issue notes shall made a weekly return to the Auditor of its notes redeemed to and withdrawn from circulation, and of those still outstanding, and the compensation hereinbefore authorized shall be paid to it half yearly in proportion to the amount so redeemed and withdrawn, computed on the average of the weekly returns for the half year, until the amount redeemed is equal to nine-tenths of its circulation on the thirtieth day of April, one thousand eight hundred and sixty-six, when it shall be entitled to compensation on the full amount thereof.

Powers of Governor in Council in making arrangement with any Bank.5. The powers of the Governor in Council in making an arrangement with any Bank for the surrender of its power to issue notes, shall extend to any provisions which may be deemed expedient respecting the redemption of the notes of such Bank, or the right of reissuing any such notes during the period agreed upon for the gradual redemption thereof, and generally to all provisions which the Governor in Council may deem expedient to the convenient working of this Act, and not inconsistent with the enactments contained in it, subject, nevertheless, to the arrangements already made under the authority of the Act of the late Province of Canada hereinafter mentioned; and any Order in Council for giving effect to such provisions shall have the force of law.

Power to resume right of issue.6. Any Bank which may have surrendered its power to issue notes, may resume such power after giving at least three months notice in writing to the Receiver General, and publishing such notice during the like period in the Canada Gazette; Consequence of resumptionbut such Bank shall, from the expiration of such notice, cease to receive compensation on its notes withdrawn from circulation, and shall pay back to the Receiver General any sum it has received from him in Dominion notes in exchange for Provincial Debentures or other Government securities, which shall then be redelivered to the Bank, and the Bank shall be bound to hold the amount of Provincial Debentures or other securities required by its charter, before it shall resume the issue of notes.

As to rights on renewal of charters. 7. No Bank surrendering its power to issue notes shall thereby be deprived of its claim to any privilege or power which shall be granted to other Banks on the renewal of their charters, in the year one thousand eight hundred and seventy.

Recital.8. And whereas by an Act of the Legislature of the late Province of Canada passed in the session held in the twentyninth and thirtieth years of Her Majesty's Reign, and intituled: 29 30 V. c. 10."An Act to provide for the issue of Provincial Notes," the Governor of that Province in Council was empowered to authorize the issue of Provincial Notes for the general purposes of the Province, to the amount of five millions of dollars, and to a further amount not exceeding three millions of dollars for purposes relative to the surrender by all or any of the chartered Banks of the Province of their power to issue notes, under provisions similar to those made in this Act, and it was provided that such notes should be of such denominational values and in such form as the Governor in Council might direct, and be redeemable in specie on presentation at offices to be established at Montreal and Toronto, and at that one of the said places at which they were respectively made payable, and should be a legal tender except at the offices aforesaid: And whereas such Provincial Notes to the amount of five millions of dollars were in pursuance of the said Act issued for the general purposes of the Province, and a further amount for purposes relative to the surrender by the Bank of Montreal of its power to issue notes, and for such other purposes provided for by the aforesaid Act as are specified in the agreement with the said Bank approved of by the Governor in Council; Certain Provincial Notes issued under that Act to be Dominion Notes: redemption, reissue, &c.and Provincial Notes to an amount equal in the whole to eight millions of dollars, were engraved and prepared for issue;—therefore, the Provincial Notes issued or prepared for issue as aforesaid, to an amount, not exceeding in the whole eight millions of dollars, shall be held to be Notes of the Dominion of Canada, and having been or being hereafter issued under the Act above cited or this Act, shall be redeemable in specie on presentation at offices established or to be established at Montreal, Toronto, Halifax and St. John (New Brunswick), and at that one of the said places at which they may be respectively made payable, and being so redeemed may and might be again re-issued for the general purposes of the Dominion, and shall be (as provided by the Act before cited) a legal tender except at the offices at which they are respectively made payable;—Issue of balance not yet issued.and the said eight millions of dollars in such notes, not issued under the provisions of the Act before cited, may be issued as Dominion Notes for the purposes of this Act;

Proviso: as to notes redeemable at Halifax.Provided always, that such of the said Notes as are made payable at Halifax, shall, so long as the currency of Nova Scotia remains such as it now is, be redeemable in that currency, that is, at the rate of one pound sterling, English, for every five dollars of the face value of such notes; and shall be a legal tender in Nova Scotia only;

Proviso: for issue of Dominion Notes instead of Provincial Notes redeemed.And provided also, that instead of re-issuing any such Provincial Notes, the Governor in Council may authorize the issue of Dominion Notes to an amount not exceeding that of the Provincial Notes redeemed, and such Dominion Notes may be of such denominational values and in such form, and signed by such persons and in such manner, by lithograph, printing or otherwise as he may from time to time direct, and such Notes shall be redeemable in specie on presentation at offices to be established at Montreal, Toronto, Halifax and St. John, and at that one of the said places at which they may be respectively made payable, and shall be a legal tender except at the offices at which they are respectively made payable; subject always to the foregoing proviso as to those made payable at Halifax, so long as the currency of Nova Scotia remains unchanged.

Offices for redemption of notes.9. The Governor may in his discretion establish branches of the Receiver General's department in Montreal, Toronto, Halifax and St. John, respectively, for the issue and redemption of Provincial or Dominion notes, or he may make arrangements with any chartered Bank or Banks, for the issue and redemption thereof, and may for such service allow a commission not exceeding one quarter of one per cent, for every three months, upon the average amount of notes in circulation during that period.

Sums to be held in specie for redemption of Provincial or Denomination Notes:10. The sum to be held in specie by the Receiver General for the redemption of Provincial or Dominion notes, shall be twenty per cent, upon the amount thereof in circulation, so long as such amount does not exceed five millions of dollars; for any excess over five millions, twenty-five per cent, of such excess shall be so held; Debentures for any difference between such specie and amount of notes.and Debentures of the late Province of Canada or of the Dominion of Canada, shall be held by the Receiver General, to the full amount by which the specie held as aforesaid fails to cover the whole amount of Provincial or Dominion notes outstanding at any time; and debentures of the Dominion may be issued and delivered to the Receiver General for this purpose; Power of Receiver General.such debentures being so held for securing the redemption of the Provincial or Dominion notes, and the Receiver General having full power to dispose of them, either temporarily or absolutely, for raising funds for that purpose, or for procuring the amounts of specie to be held by him under the provisions of this section.

Commissioners for ascertaining the amount of notes issued and specie and debentures held.11. The Governor in Council shall, from time to time, appoint Commissioners, three for the Province of Ontario, and three for the Province of Quebec, two for Nova Scotia and New Brunswick, with such remuneration as he shall determine, whose duty it shall be to examine on the first Wednesday of every month, or on such other days as may be from time to time directed by the Governor in Council, into the number of Provincial or Dominion notes then issued and outstanding at the Branch Departments of the Receiver General, or the offices of the Banks issuing the same, at Montreal, Toronto, Halifax and St. John, respectively, and also into the amount of specie and debentures then held at the said places respectively for the redemption of such notes; Result of examination to be returned on Oath and published.and upon such examination, the said Commissioners for each of the said Provinces respectively, or any two of them, shall return the result of such examination under oath to the Auditor, who shall publish such return in the next number of the Canada Gazette; and such oath shall be in the following form, or in such other form as may from time to time be directed by order in Council, and if wilfully false shall subject the person taking the same to all the pains and penalties of the crime of perjury:

Form of Oath.

"We, A. B. &c., Commissioners for (the Province of Quebec or as the case may be) make oath and say, that on the day of ⁠A. D., 18   , the Provincial or Dominion notes outstanding and in circulation from (Montreal, or as the case may be) amounted to ⁠ dollars, and the Specie and Provincial or Dominion debentures then held for the redemption of such notes at (Montreal, or as the case may be) amounted to ⁠ dollars in specie and ⁠ dollars in debentures."

Proceeds and expenses of Notes.12. The proceeds of the said Provincial or Dominion notes shall form part of the Consolidated Revenue Fund of Canada, and the expenses lawfully incurred under this Act shall be paid out of the said Fund.

Interpretation.13. The word "specie" in this Act means coin current by law of that one of the Provinces in which any Provincial or Dominion note is made payable, at the rates and subject to the provisions of the law in that behalf, or Bullion of equal value according to its weight and fineness;—and the expression "Provincial Debentures or Government Securities" in the first, second, third and sixth sections of this Act, means and includes any Debentures, which under the charter of the Bank in question may be held by it in compliance with any provision in its charter obliging it to invest a certain portion of its capital in such Debentures or Securities.

Punishment for forging notes, &c.14. If any person engraves or in anywise makes upon any plate whatever, or upon any wood, stone or other material, any note purporting to be a Provincial Note, or a Note of the Dominion of Canada, without the authority of the Minister of Finance, the proof of which shall lie on the party accused; or if any person engraves or makes upon any plate whatever, or upon any wood, stone or other material, any word or words resembling or apparently intended to resemble any subscription subjoined to any Provincial Note, or Note of the Dominion of Canada, without such authority, to be proved as aforesaid; Having plates, &c., in possession.or if any person without such authority, to be proved as aforesaid, uses, or without lawful excuse, to be proved by the party accused, knowingly has in his custody or possession, any plate, wood, stone or other material upon which any such Provincial Note, or Note of the Dominion of Canada, or part thereof, or any word or words resembling or apparently intended to resemble such subscription as aforesaid has been engraved or made; Uttering notes, &c.or if any person without such authority, to be proved as aforesaid, knowingly offers, utters, disposes of or puts off, or without lawful excuse, to be proved as aforesaid, knowingly has in his custody or possession any paper upon which any part of such Provincial Note, or Note of the Dominion of Canada, or any word or words resembling or apparently intended to resemble any such subscription, has been made or printed, every such offender shall be guilty of felony, and on conviction shall be liable to be imprisoned in the penitentiary for any term not less than two years nor more than seven years, or to be imprisoned in any Common Gaol for any term less than two years, in the discretion of the court before which the conviction is had.

Repeal of inconsistent enactments.15. So much of any Act or law in force in this Dominion as may be inconsistent with this Act, is hereby repealed.