Building Societies Act , 1989

(c) any reference to an officer, employee or agent of a society or other body includes a reference to a person who has been but no longer is an officer, employee or agent of that society or body.

42 Control of advertising.

42.—(1) If, with respect to any building society, the Central Bank considers it expedient to do so, it may give the society a direction in relation to the matter and form of any advertisement or other means of soliciting deposits or subscriptions for shares in the society or in relation to the matter and form of any advertisement relating to any service provided or business being undertaken by the society and may direct the society to withdraw an advertisement or to cease advertising.

(2) Without prejudice to the generality of subsection (1), a direction under this section may do all or any of the following—

(a) prohibit the issue by the society of advertisements of all descriptions or any specified description,

(b) require the society to modify advertisements of a specified description in a specified manner,

(c) prohibit the issue by the society of any advertisements which are, or are substantially, repetitions of a specified advertisement,

(d) require the society to withdraw any specified advertisement or any advertisement of a specified description, or

(e) require the society to include specified information in any advertisement to be published by it or on its behalf or in any statement to the public to be made by it or on its behalf.

(3) In this section—

(a) “advertisement” includes every form of recommendation of any matter to which this section relates, including in particular the display or publication of any such matter by way of leaflet, notice, circular, pamphlet, brochure, photograph, film, video, sound broadcasting, television, electronic communication or personal canvassing and references to the issue of advertisements shall be construed accordingly; and

(b) “specified” means specified in a direction under this section.

43 Power of Court to prohibit certain contraventions of Act.

43.—(1) Where, on an application made in a summary manner by the Central Bank, the Court is of the opinion that there has occurred or is occurring—

(a) a contravention of this Act,

(b) a failure to comply with a condition imposed in relation to an authorisation by virtue of section 17, or with a direction under section 40 or 42, or

(c) a failure to comply with a condition imposed on an approval under section 36 to exercise an adoptable power,

the Court may, by order, prohibit the continuance of the contravention or failure by the person or persons concerned, or in the case of paragraph (c), require the cessation of the exercise of the adoptable power.

(2) The Court when considering the application may make such interim or interlocutory order as it considers appropriate.

(3) The foregoing provisions of this section are without prejudice to the general functions of the Central Bank.

(4) Where the Court is satisfied, because of the nature or circumstances of the case or otherwise in the interests of justice, that it is desirable, the whole or any part of proceedings under this section may be held otherwise than in public.

44 Disclosure of information.

44.—(1) A person, who at the commencement of this section is, or at any time thereafter is appointed, Governor, or a Director, officer or servant of the Central Bank, or who is employed by the Bank in any other capacity, shall not disclose, during his term of office or employment or at any time thereafter, any information concerning the business of any building society or any of its subsidiaries or other associated bodies which may come to his knowledge by virtue of his office or employment unless such disclosure is to enable the Bank to carry out its functions.

(2) The provisions as to non-disclosure contained in subsection (1) shall not apply to any disclosure—

(a) required by a court in connection with any criminal proceedings,

(b) made with the consent of the person to whom the information relates and, where not the same person, of the person from whom that information was obtained,

(c) where the Central Bank is acting or has acted in the capacity of an agent for a person, made to the person in respect of that capacity,

(d) where the Bank considers it necessary for the common good, made to any person charged by law with the supervision of financial institutions (whether or not entitled to take money on deposit from the public) and who, in the opinion of the Bank, has obligations duly imposed in respect of non-disclosure of information and corresponding to obligations under this section,

(e) made to an authority in a foreign jurisdiction duly authorised to exercise functions in that jurisdiction which correspond to the functions of the Bank under this Part and section 17 and which, in the opinion of the Bank, has obligations duly imposed in respect of non-disclosure of information and corresponding to obligations under this section,

(f) made to any institution of the European Communities for the purpose of the State's membership of any of those Communities,

(g) in the form of a summary or collection of information so framed as not to enable information relating to any particular body or person to be ascertained from it,

(h) which, in the opinion of the Bank, is necessary for the protection of the funds of shareholders in or depositors with a building society or to safeguard the interests of the Bank,

(i) made to the Minister, for the purposes of his functions in relation to the national housing programme.

(3) After the commencement of this section, every person who is appointed as Governor, or a Director, officer or servant of the Central Bank, or who is employed by the Bank in any other capacity, shall—

(a) before entering into the office or employment, be informed by the Bank of his obligations under this section, and

(b) acknowledge that he has been so informed and understands his obligations,

in such manner as the Bank shall determine.

(4) A person who contravenes subsection (1) shall be guilty of an offence and shall be liable—

(a) on summary conviction to a fine not exceeding £1,000 or, at the discretion of the court, to imprisonment for a term not exceeding 12 months, or to both, or

(b) on conviction on indictment to a fine not exceeding £25,000 or, at the discretion of the court, to imprisonment for a term not exceeding 5 years, or to both.

(5) In any proceedings for an offence under this section, it shall not be necessary to prove that the provisions of subsection (2) do not apply and the onus of proving that any of those provisions do apply shall be on the person seeking to avail himself thereof.

45 Appointment of inspector and calling of special meeting.

45.—(1) Where—

(a) an application is made to the Central Bank by not less than one-tenth of the total number of members of a building society entitled to vote pursuant to section 69 (1) (a) or 200 such members, whichever is the lesser; or

(b) the Central Bank is of the opinion that an investigation should be held into the affairs of a society or that the affairs of the society call for consideration by a meeting of the members of the society;

the Bank, as it thinks proper, may appoint one or more inspectors to investigate the affairs of the society and, where necessary, any subsidiary or other associated body and to report thereon in such manner as it directs, or may call a special meeting of the society.

(2) The Central Bank may, either on the same or on different occasions, both appoint an inspector and call a meeting under subsection (1).

(3) (a) An application under this section shall be supported by such evidence as the Central Bank may direct, for the purposes of showing that the applicants have good reason for requiring the investigation to be made or the meeting to be called and that they are not actuated by malicious motives in their application.

(b) Such notice of the application shall be given to the society and, in a case where the investigation is to extend to its affairs also, to the subsidiary or associated body of the society, as the Central Bank may direct.

(c) The Central Bank may require the applicants to give security for payment of the costs of the investigation or meeting before the inspector is appointed or the meeting is called subject, in the case of the costs of an investigation, to an amount not exceeding £200,000.

(d) As regards the expenses of and incidental to the investigation or meeting, the expenses shall be defrayed by the applicants or out of the funds of the society or by the members or officers or former members or officers of the society in such proportions as the Central Bank may direct but, in the case of an investigation (in whichever way instituted), the expenses may be defrayed in the first instance by the Bank but without prejudice to its rights to contribution under section 46.

(4) (a) The Central Bank may give such directions as it thinks fit in relation to the calling, holding and conduct of a meeting held under this section (including the time and place of the meeting and the matters to be discussed and determined at the meeting).

(b) The Central Bank shall appoint a person to be chairman of the meeting.

(c) The meeting shall have all the powers of a meeting called according to the rules of the society.

(d) This subsection shall have effect notwithstanding anything in the rules of the society.

(5) Before appointing an inspector or calling a meeting under this section the Central Bank may, if it is of the opinion that it would not be prejudicial to the interests of members or creditors, notify the society in writing of the action which it proposes to take and of the grounds on which it proposes to take it and, in such a case, the society shall, within 14 days of the receipt of the notification, be entitled to give to the Bank an explanatory statement in writing.

(6) Where an inspector appointed under this section thinks it necessary for the purposes of his investigation to investigate also the affairs of any other society or any body corporate which is or has at any relevant time been a subsidiary of, or associated with, the first-mentioned society, he shall, with the approval of the Central Bank, have power to do so, and shall report on the affairs of the other society or body corporate so far as he thinks the results of his investigation thereof are relevant to the investigation of the affairs of the first-mentioned society.

46 Provisions supplemental to section 45.

46.—(1) It shall be the duty—

(a) of all officers, members and agents of a society or other body the affairs of which are being investigated under section 45, and

(b) of any other person who the inspector considers is or may be in possession of any information concerning the affairs of the society or body,

to produce to him all books, accounts, deeds, records or other documents of, or relating to, the society or body which are in their power, possession or procurement, to attend before the inspector when required to do so and otherwise to give to him all assistance in connection with the investigation which they are reasonably able to give.

(2) The inspector may examine on oath the officers, members and agents of the society or other body being investigated and any such person as is mentioned in subsection (1) in relation to its affairs and may administer an oath accordingly.

(3) If an inspector has reasonable grounds for believing that a director or past director of the society whose affairs the inspector is investigating maintains or has maintained a bank account of any description, whether alone or jointly with another person and whether in the State or elsewhere, into or out of which there has been paid—

(a) any money which has resulted from or been used in the financing of any transaction, arrangement or agreement particulars of which were not included in the register of certain transactions and arrangements as required by section 59; or

(b) any money which has been in any way connected with any act or omission, or series of acts or omissions, which on the part of that director constituted misconduct (whether fraudulent or not) towards that society or its members;

the inspector may require the director or past director to produce to him all documents in the director's possession, or under his control, relating to that bank account and in this subsection “bank account” includes an account with any person exempt by virtue of section 7 (4) of the Act of 1971 from the requirement of holding a licence under section 9 of that Act.

(4) If any officer, member or agent of the society or other body or any such person as is mentioned in subsection (1) refuses to produce to the inspector any book or document which it is his duty under this section to produce, refuses to attend before the inspector when required to do so, or refuses to answer any question put to him by the inspector with respect to the affairs of the society, or other body, as the case may be, he shall be guilty of an offence.

(5) Nothing in this section—

(a) shall compel the production by a barrister or solicitor of a document or material containing a privileged communication made by him or to him in that capacity or the furnishing of information contained in a privileged communication so made, or

(b) shall require the disclosure by a bank or a building society of any information as to the affairs of any of its customers other than the society or body the affairs of which are being investigated.

(6) In this section any reference to officers or to agents shall include past as well as present officers and agents, as the case may be, and “agents”, in relation to a society or other body, shall include the bankers, accountants, solicitors, auditors and the financial and other advisors of the society or other body.

(7) The Central Bank shall be entitled to be repaid the expenses of the investigation defrayed by it under section 45 (3) (d) as follows, that is to say—

(a) by the applicants for the investigation to such extent (if any) as the Bank may direct;

(b) by any body whose affairs were the subject of the investigation to such extent (if any) as the Bank may direct; or

(c) by a person convicted of an offence in proceedings instituted as a result of the investigation to such extent (if any) as the court by or before which he was convicted may order; and a person liable under any one of paragraphs (a) to (c) is entitled to contribution from any other person liable under the same paragraph according to the amount of their respective liabilities under it.

47 Inspectors' reports and proceedings thereon.

47.—(1) An inspector appointed under section 45 may, and shall if the Central Bank so requires, make an interim report to the Bank and, on conclusion of the investigation, shall make a final report to the Bank, but he may at any time in the course of the investigation, without making an interim report, inform the Bank of matters coming to his knowledge as a result of the investigation.

(2) The Central Bank shall—

(a) forward a copy of any report made by an inspector under this section to the Minister, and the Minister for Finance;

(b) if it thinks fit, furnish a copy thereof to the society and its auditors;

(c) if it thinks fit, furnish a copy thereof, on request and on payment of such fee as it may fix, to any other person who is a member of the society or of any other body corporate dealt with in the report by virtue of section 45 or whose interests as a creditor of the society or of any such other body corporate appear to the Bank to be affected;

(d) if it thinks fit, at the request of the applicants for the investigation, furnish a copy to them on payment of such fee as may be fixed by the Bank.

(3) The Minister may lay the report under subsection (1) before each House of the Oireachtas and such publication shall be privileged and a report not so laid may be printed and published by the Central Bank.

(4) (a) Where it appears to the Central Bank that any person has, in relation to the society or any body corporate the affairs of which have been investigated under section 45, been guilty of any offence for which he is criminally liable, the Bank shall refer the matter to the Director of Public Prosecutions.

(b) Where the Director of Public Prosecutions institutes proceedings consequent on the receipt by him of a report under paragraph (a), it shall be the duty of all officers, members and agents of the society or any body corporate (other than the defendants in the proceedings) to give him all assistance in connection with the prosecution which they are reasonably able to give.

(5) Where it appears to the Central Bank after consideration of an inspector's report under subsection (1) that it is expedient to do so it may, unless the society is being wound up by the Court, petition the Court for an order to wind up the society under section 109.

(6) Where it appears to the Central Bank after consideration of an inspector's report under subsection (1) that proceedings ought in the public interest to be brought by the society for damages, in respect of any fraud, misfeasance or other misconduct in connection with the promotion or formation of the society or the management of its affairs, or for the recovery of any property misapplied or wrongfully retained, the Bank may itself bring proceedings for that purpose in the name of the society.

(7) The Central Bank may indemnify the society against any costs or expenses incurred by it in, or in connection with, any proceedings brought under subsection (6).

(8) A copy of any report of an inspector appointed under section 45 shall be admissible in any legal proceedings as evidence of the opinion of the inspector in relation to any matter contained in the report.

PART V Management of Building Societies

48 Directors.

48.—(1) A building society shall have at least 3 directors.

(2) A society shall not have as a director a body corporate.

(3) The directors shall appoint from among their number a chairman of the board of directors.

(4) The chairman of the board of directors shall not also be the chief executive of the society except with the consent of the Central Bank.

49 Chief executive and secretary.

49.—(1) A building society shall have—

(a) a chief executive who, either alone or jointly with one or more other officers of the society, shall be responsible, under the immediate authority of the board of directors, for the conduct of the business of the society; and

(b) a secretary.

(2) The offices of chief executive and secretary may not be held by the same person except with the consent of the Central Bank.

(3) The chief executive and the secretary of a society shall be appointed by the board of directors of the society who shall take all reasonable steps to ensure that the persons appointed are persons who have the knowledge and experience to discharge the functions of those offices.

(4) The board of directors of a society shall give to the Central Bank prior notice of a proposal to appoint a person as chief executive stating the person's full name and address, the date on which he is to take office and such other information as the Bank may require and the Bank shall record the person's name and the date on which he begins to hold office in the public file of the society.

(5) Where a person ceases to hold office as chief executive the board shall, as soon as may be, give notice of that fact to the Central Bank which shall record it in the public file of the society.

(6) Anything required or authorised to be done by or in respect of the chief executive or secretary may, if the office is vacant or there is for any other reason no chief executive or secretary capable of acting, be done by or in respect of any deputy or assistant chief executive or secretary, as the case may be, or if there is no deputy or assistant capable of acting, by or in respect of any officer of the society authorised generally or specially for that purpose by the directors.

(7) Where the chief executive is also a director he may be referred to as the managing director.

50 Directors: appointment and retirement.

50.—(1) Subject to subsections (11) and (16), the directors of a building society must be elected to office either—

(a) at an annual general meeting of the society, or

(b) by postal ballot conducted during the period of 3 months preceding the date on which the annual general meeting is held,

as the rules provide.

(2) Where subsection (1) (a) applies and the number of candidates for the office of director exceeds the number of vacancies, the election of directors shall be by poll.

(3) The persons entitled to vote in an election of directors are those members of the society who in accordance with section 69 and under the rules are entitled to vote on an ordinary resolution.

(4) A person entitled to vote in an election of directors cannot be required to cast all or any of his votes.

(5) A person who is not a member of a society may, if its rules so provide, be a director.

(6) The rules of a society may impose, as a condition of a person's eligibility to be or to be nominated for election as a director of the society, a requirement that he shall hold beneficially shares in the society not less in value than the amount specified by the rules, but the maximum holding that may be required shall not exceed £500, or such other amount as may be substituted for it in regulations made by the Central Bank.

(7) The rules of a society shall not require, as conditions of the validity of a person's nomination for election as a director, that—

(a) more than 20 members join in nominating him;

(b) a nominating member be a member for more than 2 years before the date of the nomination or hold, or have at any time during that period held, shares in the society to a value greater than £250; or

(c) more than £250 be deposited with the society in connection with his candidature.

(8) The rules of a society shall not impose, as conditions of the validity of a person's nomination for election as a director, conditions in relation to matters other than those in subsections (6) and (7) except as may be approved by the Central Bank as being reasonable.

(9) The Central Bank may, by regulation, substitute for the number, the maximum period of membership, the maximum value of shares, and the maximum amount of the deposit referred to in subsection (7), such other number, period, value, or amount as it thinks appropriate.

(10) A director, other than a director who is also the chief executive of a society, shall retire from office not later than the end of the third annual general meeting of the society following the date of his election, subject to any provision in this Act or in the rules of the society for his earlier retirement and such director shall be eligible for election without nomination, subject to the rules.

(11) If the rules of a society so provide, the directors for the time being may co-opt as director to fill any vacancy on the board of directors any person who—

(a) appears to them to be fit and proper to be a director, and

(b) is not disqualified under section 64 to be a director of a building society,

not being a person who, having stood for election as a director at any election held within the preceding 16 months, was not elected as a director.

(12) A person who is co-opted under subsection (11) shall cease to hold office at the end of the next annual general meeting following his appointment, but a general meeting shall be disregarded for the purposes of this subsection if the closing date for the nomination of candidates falls before the date of the co-opted director's appointment, but he shall retire as a co-opted director at the next annual general meeting following that which is disregarded and shall be eligible for election without nomination, subject to the rules.

(13) Where in an election of directors there is a poll, whether conducted at a meeting or by way of postal ballot, the papers issued by the society for the purposes of or relating to the poll shall—

(a) show with equal prominence the name of each candidate, and

(b) arrange the names alphabetically in the order of the surnames, or if there are 2 or more candidates bearing the same surname, in the alphabetical order of their other names together with such information as will distinguish such candidates.

(14) The acts of a director shall be valid notwithstanding any defects which may afterwards be discovered in his appointment or qualification.

(15) A society shall notify the Central Bank—

(a) of all valid nominations of persons for election as directors, as soon as possible after the closing date for nominations; and

(b) of the proposed co-option of persons as directors at least 14 days before the date of the appointment;

giving in each case the information referred to in section 66 (1) and such other information as the Bank may require.

(16) The persons mentioned in section 10 (2) or a majority of them may appoint as directors to hold office until the conclusion of the first annual general meeting persons not disqualified under section 64.

(17) In this section, “ordinary resolution”, means a resolution which will be effective without being passed as a special resolution or a conversion resolution.

51 Directors: supplementary provisions as to elections, etc.

51.—(1) A building society shall give notice of the latest date for the receipt of nominations for election as a director in either of the following ways—

(a) by publishing it in at least 2 daily newspapers published in the State and circulating in the area in which the chief office of the society is situated and such notice shall be published not earlier than 42 days before such date; or

(b) by sending it, not earlier than the date on which notices are issued for the preceding year's annual general meeting to all members who would at the date of the notice be entitled to notice of an election of directors,

as the rules provide, and in either case the notice shall be published or sent, as the case may be, not later than 21 days before the latest date for the receipt of nominations.

(2) If a duly nominated candidate for election as a director of a society furnishes the society with an election address of not more than 300 words before the closing date for nominations, then, subject to subsection (3)—

(a) it shall be the duty of the society, at its expense, to send a copy of the address to each member of the society who is entitled to notice of the election; and

(b) each member's copy shall be sent in the same manner and, so far as practicable, at the same time as the notice of the meeting at which the election is to be conducted or the ballot papers are sent out, as the case may be;

but failure to comply with a requirement of this subsection shall not of itself invalidate the election.

(3) Subsection (2) does not require a society to send copies of an address to members of the society in any case where—

(a) the contents of the address would be likely to diminish substantially public confidence in the society, or

(b) the rights conferred by that subsection are being abused to seek needless publicity for defamatory matter or for frivolous or vexatious purposes,

and that subsection shall not be taken to confer any rights on members, or to impose any duties on a society, in respect of an address which does not relate directly to the affairs of the society.

(4) Where the society refuses, or proposes to refuse, to circulate an election address, the society shall, within 7 days after the receipt of the address, notify the member who furnished it of such refusal and the grounds for the refusal and the said member may, within 7 days of the refusal, refer the refusal to the Central Bank who may direct the society to comply with the request subject to such conditions as the Bank may require.

(5) (a) The person appointed under the rules of a society to supervise the conduct of an election of directors shall prepare and submit to the Central Bank a report on the conduct of the election—

(i) stating whether in his opinion the election was conducted in accordance with the provisions of this Act, regulations made thereunder and the rules and otherwise with fairness and integrity;

(ii) containing details of the number of proxy instruments received, the number declared invalid categorised by cause of invalidation and the number of votes attributable to valid instruments; and

(iii) containing such other information as may be required by the Bank.

(b) The Central Bank may, as it thinks proper, disclose some or all of the contents of a report under paragraph (a) to a duly nominated candidate.

(6) A society shall retain for a period of one year from the date of the election all ballot papers and all its documents and records relating to an election of directors.

(7) The Central Bank may, following consideration of the report made to it under subsection (5), if it thinks proper, apply to the Court for an order setting aside the result of an election of directors and directing the society to hold another election.

(8) An employee, other than an officer, of a society, not being himself a candidate, who, at the place of his employment or of a meeting of the society, solicits support for a candidate for election as a director or invites a member of the society to appoint as his proxy any particular person to vote in an election shall be guilty of an offence and shall be liable on conviction to a fine not exceeding £300.

52 Connected persons.

52.—(1) For the purposes of this Part, a person is connected with a director of a building society if, but only if, he is—

(a) that director's spouse, parent, brother, sister or child; or

(b) a body corporate with which the director is associated; or

(c) a person acting in his capacity as the trustee (other than as trustee under an employees' share scheme or a pension scheme) of any trust the beneficiaries of which include the director, his spouse or any of his children or a body corporate with which he is associated or the terms of which confer a power on the trustees that may be exercised for the benefit of the director, his spouse or any of his children or any such body corporate; or

(d) a person acting in his capacity as partner of that director or of any person who, by virtue of paragraph (a), (b) or (c) is connected with that director;

unless that person is also a director of the society.

(2) A director of a society is associated with a body corporate if he and his spouse, parent, brother, sister or child or a person acting in his capacity as trustee of any trust the beneficiaries of which include the director, his spouse or any of his children between them either—

(a) own at least one-fifth of that body's equity share capital within the meaning of the Companies Act, 1963, or

(b) are entitled to exercise or control the exercise of more than one-fifth of the voting power of that body at any general meeting.

(3) In subsection (1) “child” includes a step-child and “son”, “daughter” and “parent” shall be construed accordingly.

53 Disclosure by directors of interests in contracts.

53.—(1) It shall be the duty of a director of a building society who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the society to declare the nature of his interest at a meeting of the directors of the society.

(2) In a case of a proposed contract, the declaration shall be made—

(a) at the meeting of the directors at which the question of entering into the contract is first considered; or

(b) if the director was not at the date of that meeting interested in the proposed contract, at the next meeting of the directors held after he becomes so interested.

(3) Where the director becomes interested in a contract after it is made, the declaration shall be made at the first meeting of the directors held after the director becomes so interested.

(4) If the contract is not one that will be considered at a meeting of the directors, the declaration shall be made as soon as may be.

(5) Subject to subsection (6), for the purposes of this section, a general notice given to the directors of a society by a director to the effect that—

(a) he is a member of a specified company or firm and is to be regarded as interested in any contract which may, after the date of the notice, be made with that company or firm; or

(b) he is to be regarded as interested in any contract which may after the date of the notice be made with a specified person who is connected with him,

shall be deemed to be sufficient declaration of interest in relation to any such contract.

(6) A notice under subsection (5) shall not be of effect unless either it is given at a meeting of the directors or the director takes reasonable steps to secure that it is brought up and read at the next meeting of the directors after it is given.

(7) A copy of every declaration made and notice given under this section shall, within 3 days (not including a Saturday, a Sunday or a public holiday) after being made or given, be entered in a register kept for the purpose and this register shall be open for inspection without charge by any officer, auditor or member of the society at the chief office of the society and shall be available at every general meeting of the society, and at any meeting of the directors if any director so requests in sufficient time to enable the register to be available at the meeting.

(8) The provisions of this section apply in relation to any transaction or arrangement as they apply to a contract and, for the purposes of this section, a transaction or arrangement of a kind described in section 57 made by a society for a director of the society or a person connected with such a director shall, if it would not otherwise be so treated (and whether or not prohibited by that section), be treated as a transaction or arrangement in which that director is interested.

(9) Nothing in this section shall affect the operation of any rule of law restricting directors of a society from having any interest in contracts with the society.

54 Contracts of employment of directors.

54.—(1) A building society shall not incorporate in any agreement a term to which this section applies unless the term is first approved by a resolution of the society in general meeting.

(2) This section applies to any term by which a director's employment with the society of which he is a director is to continue, or may be continued, otherwise than at the instance of the society, (whether under the original agreement or under a new agreement entered into in pursuance of the original agreement) for a period exceeding 5 years during which the employment—

(a) cannot be terminated by the society by notice, or

(b) can be so terminated only in specified circumstances.

(3) In any case where—

(a) a person is or is to be employed with a society under an agreement which cannot be terminated by the society by notice or can be so terminated only in specified circumstances, and

(b) more than 6 months before the expiration of the period for which he is or is to be so employed, the society enters into a further agreement (otherwise than in pursuance of a right conferred by or by virtue of the original agreement on the other party thereto) under which he is to be employed with the society,

subsection (2) shall apply as if to the period for which he is to be employed under that further agreement there were added a further period equal to the unexpired period of the original agreement.

(4) A resolution of a society approving a term to which this section applies shall not be passed at a general meeting of the society unless a written memorandum setting out the proposed agreement incorporating the term is available for inspection by members of the society both—

(a) at its chief office during the period of 15 days expiring on the date of the meeting, and

(b) at the meeting itself.

(5) A term incorporated in an agreement in contravention of this section shall to the extent that it contravenes this section be void and that agreement and, in a case where subsection (3) applies, the original agreement shall be deemed to contain a term entitling the society to terminate it at any time by the giving of reasonable notice.

(6) In this section, “employment” includes employment under a contract for services.

55 Inspection of directors' service contracts.

55.—(1) Subject to this section, a building society shall keep at its chief office a register containing—

(a) in the case of each director who has a contract of service with the society, a copy of that contract if in writing;

(b) in the case of each director whose contract of service with the society is not in writing, a written memorandum setting out the terms of that contract;

(c) in the case of a director who has a contract of service with a subsidiary of the society, a copy of that contract or, if it is not in writing, a written memorandum setting out its terms.

(2) Subsection (1) shall not apply in relation to a director's contract of service with the society or with a subsidiary of the society if that contract required him to work wholly or mainly outside the State, but the society shall keep at its chief office a memorandum—

(a) in the case of a contract of service with the society, setting out the name of the director and the provisions of the contract relating to its duration;

(b) in the case of a contract of service with a subsidiary of the society, setting out the name of the director, the name and place of incorporation of the subsidiary and the provisions of the contract relating to its duration.

(3) Every copy and memorandum required to be kept by subsections (1) and (2) shall, during business hours (subject to such reasonable restrictions as the society may in general meeting impose, so that not less than 2 hours in each day be allowed for inspection), be open to the inspection of any member of the society without charge.

(4) If default is made in complying with subsection (1) or (2) or if an inspection required under subsection (3) is refused, the society and every officer of the society who is in default shall be liable on summary conviction to a fine not exceeding £1,000, and, for continued contraventions, to a daily default fine not exceeding £50.

(5) Subsections (1) and (2) shall apply to a variation of a director's contract of service with a society and a contract of service with a subsidiary of a society as it applies to the contract.

(6) This section shall not require to be kept a copy of, or memorandum setting out the terms of, a contract or a copy of, or memorandum setting out the terms of, a variation of a contract at a time at which the unexpired portion of the term for which the contract is to be in force is less than 3 years or at a time at which the contract can, within the next ensuing 3 years, be terminated by the society without payment of compensation.

56 Substantial property transactions involving directors and connected persons.

56.—(1) A building society shall not enter into an arrangement—

(a) whereby a director of the society or a person connected with such a director acquires or is to acquire one or more non-cash assets of the requisite value from the society; or

(b) whereby the society acquires or is to acquire one or more non-cash assets of the requisite value from such a director or a person so connected;

unless the arrangement is first approved by a resolution of the society in general meeting.

(2) For the purposes of this section a non-cash asset is of the requisite value if at the time the arrangement in question is entered into its value is not less than £50,000 or, in the case of a society with reserves of less than £500,000, is not less than 10 per cent. of the reserves.

(3) In this section “non-cash asset” means any property or interest in property other than cash and for this purpose “cash” includes foreign currency; and a reference to the acquisition of a non-cash asset includes a reference to the creation or extinction of an estate or interest in, or a right over, any property and also a reference to the discharge of any person's liability other than a liability for a liquidated sum.

(4) An arrangement entered into by a society in contravention of this section and any transaction entered into in pursuance of the arrangement (whether by the society or any other person) shall be voidable at the instance of the society unless—

(a) restitution of any money or any other asset which is the subject matter of the arrangement or transaction is no longer possible or the society has been indemnified in pursuance of subsection (5) (b) by any other person for the loss or damage suffered by it;

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person who is not a party to the arrangement or transaction would be affected by its avoidance; or

(c) the arrangement is, within a reasonable period, affirmed by the society in general meeting.

(5) Without prejudice to any liability imposed otherwise than by this subsection, but subject to subsection (6), where an arrangement is entered into with a society by a director of the society or a person connected with him in contravention of this section, that director and the person so connected, and any other director of the society who authorised the arrangement or any transaction entered into in pursuance of such an arrangement, shall (whether or not it has been avoided in pursuance of subsection (4)) be liable—

(a) to account to the society for any gain which he had made directly or indirectly by the arrangement or transaction; and

(b) jointly and severally with any other person liable under this subsection, to indemnify the society for any loss or damage resulting from the arrangement or transaction.

(6) Where an arrangement is entered into by a society and a person connected with a director of the society in contravention of this section, that director shall not be liable under subsection (5) if he shows that he took all reasonable steps to secure the society's compliance with this section and, in any case, a person so connected and any such other director as is mentioned in that subsection shall not be so liable if he shows that, at the time the arrangement was entered into, he did not know the relevant circumstances constituting the contravention.

57 Restrictions on loans etc. to directors and connected persons.

57.—(1) Subject to this section, a building society shall not—

(a) make a loan to a director or a person connected with a director of the society;

(b) dispose of property by way of lease or hire to a director or a person connected with a director of the society;

(c) make a payment on behalf of a director or a person connected with a director of the society in connection with the provision of any services under Part III;

(d) enter into any guarantee or provide any security which is incidental to or connected with any such loan, disposal of property or payment; or

(e) take part in any arrangement whereby—

(i) another person enters into a transaction which if it had been entered into by the society would have contravened any of paragraphs (a) to (d), and

(ii) that other person, in pursuance of the arrangement, has obtained or is to obtain any benefit from the society or a subsidiary of the society.

(2) Subsection (1) (a) does not apply to—

(a) any loan the amount of which when aggregated with any other relevant loans does not exceed £2,500;

(b) any loan made in the ordinary course of the society's business, the amount of which is not greater, and the terms on which it is made are not more favourable, than it is reasonable to expect the society to have offered to a person of the same financial standing but not connected with the society;

(c) any loan, the amount of which, when aggregated with any other relevant loans, does not exceed £50,000 made for or towards the purchase or improvement of a house used or to be used as the director's only or main residence and provided that loans of that description and on similar terms are ordinarily made to employees of the society.

(3) Subsection (1) (b) does not apply to any lease or hiring of property—

(a) the value of which when aggregated with the value of any other relevant leases or hirings does not exceed £5,000;

(b) which is made in the ordinary course of the society's business and is on terms not more favourable than it is reasonable to expect the society to have offered to a person unconnected with the society.

(4) Subsection (1) (c) does not apply to any payment—

(a) amounting, when aggregated with any other relevant payments, to no more than £1,000 in respect of which the person on whose behalf it is made is under an obligation to reimburse the society within a period not exceeding 2 months beginning with the date of the payment; or

(b) of an amount not greater and on other terms not more favourable than it is reasonable to expect the society to have offered to a person of the same financial standing but not connected with the society.

(5) Subject to compliance with the requirements of subsection (6), subsection (1) does not preclude a society from doing anything to provide a director with funds to meet expenditure incurred or to be incurred by him for the purposes of the society or for the purpose of enabling him properly to perform his duties as a director of the society nor does it preclude the society from doing anything to enable a director to avoid incurring such expenditure.

(6) The following are the requirements referred to in subsection (5)—

(a) the things must either be done with the prior approval of the society given at a general meeting at which the requisite matters are disclosed or be done on condition that, if the approval of the society is not so given at the next annual general meeting, the loan is to be repaid, or any other liability arising under the transaction is to be discharged, within 6 months from the conclusion of that meeting; and

(b) the amount provided, when aggregated with any other relevant provision of funds, does not exceed £10,000.

(7) The following are the requisite matters which must be disclosed for the purposes of subsection (6) above—

(a) the purpose of the expenditure incurred or to be incurred, or which would otherwise be incurred, by the director;

(b) the amount of the funds to be provided by the society; and

(c) the extent of the society's liability under any transaction which is or is connected with the thing in question.

(8) A transaction or arrangement falling within subsection (1) is, for the purposes of this Part, made for a person if—

(a) in the case of a loan, disposal or payment within paragraph (a), (b) or (c) of subsection (1), it is made, in the case of paragraph (a) or (b) to him or, in the case of paragraph (c), on his behalf;

(b) in the case of a guarantee or security within paragraph (d), it is made as an incident of or in connection with a loan or disposal to him or a payment on his behalf; or

(c) in the case of an arrangement within paragraph (e), the transaction to which the arrangement relates was made for him.

(9) In this section—

“relevant”, in relation to a transaction of a description falling within paragraph (a), (b) or (c) of subsection (1), means an outstanding or, in the case of a lease or hiring, current transaction of that description (whether entered into by, or by arrangement with, the society), not being one authorised by any other authorising provision;

“authorising provision” and “authorised”, in relation to a transaction of a description falling within paragraph (a), (b) or (c) of subsection (1), mean respectively any provision of subsection (2), (3) or (4) or constituted by subsection (5) and any transaction or thing done to which that paragraph does not apply or which is not precluded from being done by virtue of that provision;

“outstanding”, in relation to loans, means outstanding in respect of any principal or interest and, in relation to the provision of funds subject to a condition for repayment or discharge of any other liability, means unpaid or undischarged to any extent;

“provision of funds” includes anything else which, by virtue of subsection (5), a society is not precluded from doing by subsection (1).

58 Sanctions for breach of section 57.

58.—(1) Where a building society enters into a transaction or arrangement contravening section 57 the transaction or arrangement shall be voidable at the instance of the society unless—

(a) restitution of any money or any other asset which is the subject matter of the arrangement or transaction is no longer possible, or the society has been indemnified in pursuance of subsection (2) (b) for the loss or damage suffered by it; or

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person other than the person for whom the transaction or arrangement was made would be affected by its avoidance.

(2) Without prejudice to any liability imposed otherwise than by this subsection but subject to subsection (3), where a transaction or arrangement contravening section 57 is made by a society for a director of the society or a person connected with such a director that director and the person so connected and any other director of the society who authorised the transaction or arrangement (whether or not it has been avoided in pursuance of subsection (1) is liable—

(a) to account to the society for any gain which he has made directly or indirectly by the transaction or arrangement; and

(b) jointly and severally with any other person liable under this subsection, to indemnify the society for any loss or damage resulting from the transaction or arrangement.

(3) Where a transaction or arrangement contravening section 57 is entered into by a society and a person connected with a director of the society, that director shall not be liable under subsection (2) if he shows that he took all reasonable steps to secure the society's compliance with that section and, in any case, a person so connected and any such other director as is mentioned in subsection (2) shall not be liable if he shows that, at the time the transaction or arrangement was entered into, he did not know the circumstances constituting the contravention.

(4) An officer of a society who authorises or permits the society to enter into a transaction or arrangement knowing or having reasonable cause to believe that the society was thereby contravening section 57 shall be guilty of an offence.

(5) A society which enters into a transaction or arrangement contravening section 57 for one of its directors shall be guilty of an offence unless it shows that, at the time the transaction or arrangement was entered into, it did not know the circumstances constituting the contravention.

(6) A person who procures a society to enter into a transaction or arrangement knowing or having reasonable cause to believe that the society was thereby contravening section 57 shall be guilty of an offence.

59 Records of loans etc. falling within section 57.

59.—(1) A building society shall maintain a register containing a copy of every subsisting transaction or arrangement (other than a transaction or arrangement excepted by subsection (6)) falling within section 57 (1) made for a director or a person connected with a director of the society during the current financial year or any of the preceding 10 financial years, but excluding years prior to 1989.

(2) In the case of a transaction or arrangement which is not in writing, there shall be kept in the register a written memorandum setting out its terms.

(3) A society shall make available for inspection by members—

(a) at its chief office during the period of 15 days expiring on the date of its annual general meeting, and

(b) at the annual general meeting,

a statement containing the requisite particulars of the transactions and arrangements falling within section 57 (1) which were included in the register under subsection (1) at any time during the last complete financial year preceding the meeting.

(4) Two copies of the statement required to be so made available to members shall be sent by the society to the Central Bank (together with the auditor's report as required by subsection (8)) not later than the date on which the statement is required to be first made available to members and the Bank shall keep one of them in the public file of the society.

(5) A copy of the latest statement required to be so made available shall also be sent by the society, on demand and on payment of a fee which may be specified by the Central Bank, to any member of the society.

(6) There are excepted from the obligations imposed by this section on a society with respect to a financial year all transactions or arrangements made or subsisting during that year for a person who was at any time during that year a director of the society or was connected with a director of the society if the aggregate of the values of each transaction or arrangement made for that person and of each agreement for such a transaction or arrangement, less the amount (if any) by which the value of those transactions or arrangements has been reduced, did not exceed £1,000 at any time during that year.

(7) The “requisite particulars” of a transactions or arrangement required by subsection (3) are such particulars of the terms of the transaction or arrangement, as may be specified from time to time by the Central Bank.

(8) It shall be the duty of the auditors of a society to examine the statement required under subsection (3) before it is made available to the members of the society and to make a report to the members on the statement; and the report shall be annexed to the statement before it is made available.

(9) A report under subsection (8) shall state whether in the opinion of the auditors the statement contains the particulars required under subsection (7) and, where their opinion is that it does not, they shall include in the report, so far as they are reasonably able to do so, a statement giving the required particulars.

60 Record and disclosure of certain business.

60.—(1) Where, at anytime during a financial year of a building society, a person both is an officer of a society and is, or is a director of or a partner in, a business associate of the society, this section shall apply as respects that year to the society in relation to the relevant service provided to the society by the business associate.

(2) A person is a “business associate” of a society in any financial year of the society if that person—

(a) carries on a business which consists of or includes the provision of relevant services,

(b) provides relevant services during that year to the society, and

(c) is not a subsidiary of the society.

(3) Subject to this section, a society shall maintain at its chief office a register containing the particulars required by subsection (4) in relation to every business associate of the society.

(4) The particulars referred to in subsection (3) are the aggregate amount of fees paid to the business associate by the society or on its behalf in respect of each of the relevant services in the last complete financial year and each of the 5 financial years preceding that year but excluding years prior to the year 1989.

(5) The following are “relevant services” for the purposes of this section—

(a) conveyancing services,

(b) surveying and valuing land or other property,

(c) arranging for the provision of insurance against loss of or damage to property or on human life,

(d) advertising or public relations services, and

(e) any other services as may be specified as relevant services by the Central Bank from time to time.

(6) Where a business associate of a society provides the society with services which are relevant services by virtue of subsection (5), any administrative services provided to the society by the business associate are also relevant services.

(7) No particulars of the business of a business associate of a society need be kept in the register provided for by subsection (3) as respects any financial year of the society in which the volume of the business of which the particulars referred to in subsection (3) are required did not exceed £5,000 or such other sum as may be specified from time to time by the Central Bank.

(8) A society shall make available for inspection by members at its chief office during the period of 15 days expiring on the date of its annual general meeting and at the annual general meeting, a statement containing the particulars required to be kept in the register as respects the last complete financial year preceding the meeting.

(9) Two copies of the statement required to be so made available to members shall be sent by the society to the Central Bank not later than the date on which the statement is required to be first made available to members and the Bank shall keep one of them in the public file of the society.

(10) A copy of the statement required to be so made available shall also be sent, on demand and on payment of such fee as may be specified by the Central Bank, to any member of the society.

61 Particulars of directors' salaries etc. to be given in accounts.

61.—Section 191 of the Act of 1963 shall, subject to any necessary modifications, apply as if the society were a company.

62 Prohibition of tax-free payments.

62.—(1) It shall not be lawful for a society to pay a director remuneration (whether as director or otherwise) free of income tax or otherwise calculated by reference to or varying with the amount of his income tax or to or with the rate of income tax.

(2) Any provision in a society's rules or in any contract or in any resolution of a society or a society's directors, for payment to a director of remuneration as in subsection (1) shall have effect as if it provided for payment, as a gross sum subject to income tax, of the net sum for which it actually provides.

(3) In this section “remuneration” includes emoluments within the meaning of section 191 of the Act of 1963.

63 Directors' names on business letters.

63.—(1) A society shall in all business letters on or in which the society's name appears and which are sent by the society to any person state in legible characters in relation to every director his present surname together with his present forename (or the initials of that forename) and any former names.

(2) If special circumstances exist which render it in the opinion of the Central Bank expedient that such an exemption should be granted, the Bank may, subject to such conditions as it may think fit, grant exemption from the obligations imposed by this section.

64 Disqualification of certain persons from acting as directors or auditors of or managing building societies.

64.—(1) A person who has been adjudicated bankrupt and whose bankruptcy still subsists or who has been convicted of an indictable offence in relation to a building society or involving fraud or dishonesty or against whom a disqualification order has been made shall not be qualified to be appointed or act as an officer, auditor, receiver, liquidator or to be in any way, whether directly or indirectly, concerned with or to take part in the promotion, formation, direction or management of a society.

(2) (a) Where the court is satisfied in any proceedings or as a result of an application under this section that—

(i) a person has been guilty, while a promoter, officer, auditor, receiver or liquidator of a society, of any fraud in relation to the society, its members or creditors; or

(ii) a person has been guilty, while a promoter, officer, auditor, receiver or liquidator of a society of any breach of his duty as such promoter, officer, auditor, receiver or liquidator; or

(iii) the conduct of any person as promoter, officer, auditor, receiver or liquidator of a society makes him unfit to be concerned in the management of a society; or

(iv) in consequence of a report of inspectors appointed by the Central Bank under this Act the conduct of any person makes him unfit to be concerned in the management of a society; or

(v) a person has been persistently in default in relation to the relevant requirements;

the court may, of its own motion, or as a result of the application, make a disqualification order against such a person for such period as it sees fit.

(b) In paragraph (a) “the court” means the High Court except in relation to a disqualification order made by a court of its own motion under paragraph (a) (i), (ii), (iii), or (v) in which case it includes any court.

(3) (a) For the purposes of subsection (2) (a) (v) the fact that a person has been persistently in default in relation to the relevant requirements may (without prejudice to its proof in any other manner) be conclusively proved by showing that in the 5 years ending with the date of the application he had been adjudged guilty (whether or not on the same occasion) of 3 or more defaults in relation to those requirements.

(b) A person shall be adjudged guilty of a default in relation to a relevant requirement for the purposes of this subsection if he is convicted of any offence consisting of a contravention of a relevant requirement.

(4) In this section “disqualification order” means an order made under subsection (2) or section 184 of the Act of 1963.

(5) An application under subsection (2) may be made by the Director of Public Prosecutions or the Central Bank.

(6) An application under paragraph (a) (i), (ii) or (iii) of subsection (2) may be made by any member, officer, auditor, receiver, liquidator or creditor of any society in relation to which the person who is the subject of the application—

(a) has been or is acting or is proposing to or being proposed to act as officer, auditor, receiver or liquidator, or

(b) has been or is concerned or taking part, or is proposing to be concerned or take part, in the promotion, formation, direction or management of a society,

and where the application is made by a member or creditor of the society, the Court may require security for all or some of the costs of the application.

(7) Where it is intended to make an application under subsection (2) in respect of any person, the applicant shall give not less than 10 days' notice of his intention to that person.

(8) Any person who is disqualified by virtue of this section may apply to the Court for relief, either in whole or in part, from that disqualification and the Court may, if it deems it just and equitable to do so, grant such relief on whatever terms and conditions it sees fit.

(9) A disqualification order may be made on grounds which are or include matters other than criminal convictions notwithstanding that the person in respect of whom the order is to be made may be criminally liable in respect of those matters.

(10) Whenever a person holding an office in a society becomes ineligible by virtue of this section to hold office, he shall forthwith cease to hold that office and the vacancy shall be deemed to be a casual vacancy and may be filled in the manner provided for such a vacancy in the rules of the society.

(11) A person who is disqualified by virtue of subsection (1) from holding any position in relation to a society and permits his name to be put forward for election or appointment to that position shall be guilty of an offence.

(12) Any person who in relation to any society, acts in a manner or capacity which, by virtue of being disqualified under subsection (1), he is prohibited from doing shall be guilty of an offence.

(13) In this section “relevant requirement” means any provision of this Act which requires or required any return, account or other document to be given or sent to, or notice of any matter to be given to the Central Bank.

65 Register of members.

65.—(1) Every building society shall keep a register of the names and addresses of its members.

(2) The register shall be kept at the chief office of the society or, with the consent in writing of the Central Bank, at one or more offices of the society other than its chief office.

(3) Every society having more than 50 members shall, unless the register is in such a form as to constitute an index, keep an index of the names of the members of the society and shall, within 14 days after the date on which any alteration is made in the register of members, make any necessary alteration in the index, and the index shall at all times be kept at the same place as the register of members.

(4) (a) A member of a society may, for the purpose of communicating with other members on a subject relating to its affairs, request the board of directors of the society to transmit to those other members such information as he requests and where the board, having regard to the interests of members as a whole and to any other relevant circumstances, is satisfied that the request is made in good faith, it shall comply with the request.

(b) Where the society complies with a request under paragraph (a) the applicant shall be liable for any costs incurred by the society in complying with the request and the society may require the applicant to give security for payment of costs.

(5) In the event of the refusal of a society to comply with a request under subsection (4), it shall notify the member who made the request of the grounds for such refusal and the member may refer the refusal to the Central Bank.

(6) A decision on a request under subsection (4) shall be notified to the member who made the request within a period of one month after the day on which the request is received by the society.

(7) Where an applicant makes a reference to the Central Bank under subsection (5), the Bank may, as it thinks proper, having heard any representations made by the society, direct the society to comply with the request subject to such limitations or conditions (including conditions relating to the nature of the information to be given, and to arrangements for payment of costs) as the Bank may think fit.

(8) At any time when a society has had its authorisation revoked under section 40 any 10 members of the society shall have the right to obtain from the register kept under subsection (1) the names and addresses of members of the society for the purpose of communicating with them on a subject relating to the affairs of the society.

66 Register of directors, etc.

66.—(1) Every building society shall keep at its chief office or, with the consent in writing of the Central Bank, at one or more of the offices of the society other than its chief office a register containing the following particulars relating to each director, the chief executive and the secretary of the society—

(a) his present surname and forenames and any former names and, in the case of a person known by a title different from his “surname”, that title;

(b) his usual residential address;

(c) his place and date of birth;

(d) his nationality;

(e) in the case of a director, his business occupation (if any); and

(f) particulars of any other directorships of bodies corporate, whether incorporated in the State or elsewhere, held by him or which have been held by him within the preceding 5 years.

(2) (a) A society shall within the appropriate period referred to in paragraph (b), send to the Central Bank a return in such form as it may require of the particulars contained in a register under this section and a notification of any change in the register, together with the date of such change.

(b) The periods mentioned in paragraph (a) are—

(i) in the case of the return, 14 days from the commencement of this section where a society is incorporated before such commencement, and 14 days from the date of appointment of the first directors where a society is incorporated after such commencement; and

(ii) in the case of a change, 14 days from the change.

(3) Any member of a society or any other person may require a copy of the register, or of any part thereof on payment of such fee as the Central Bank may fix, and the society shall cause any copy so required to be sent to the person within a period of 10 days after the day on which the request for the copy is received by the society.

(4) A register under this section shall be open to inspection by any member free of charge, and by any other person on payment of such fee as the Central Bank may fix, subject to such reasonable restrictions as the society concerned may impose at a general meeting, but so that not less than 2 hours in each business day be allowed for inspection.

PART VI Meetings, Resolutions, Voting, etc.

67 Annual general meeting.

67.—(1) Subject to subsections (2) and (3), a building society shall hold a meeting in the State, in the first 4 months of each financial year, as its annual general meeting (in addition to any other meetings in that year), and shall specify the meeting as such in the notices calling it.

(2) A society need not hold an annual general meeting in the year in which it is incorporated.

(3) The Central Bank may at its discretion, upon application being made to it in writing by a society, fix a longer period than 4 months for the purposes of subsection (1).

(4) Where default is made in complying with subsection (1), the Central Bank may call or direct the calling of an annual general meeting and give such ancillary or consequential directions as it thinks expedient, including directions modifying or supplementing the operation of the rules of the society in relation to the calling, holding and conduct of the meeting.

(5) Notwithstanding anything in the rules of a society, the business which may be dealt with at the annual general meeting may include any resolution (including as special resolution or a conversion resolution).

68 Notice of meetings.

68.—(1) Any provision in the rules of a building society shall be void to the extent that it provides for the calling of a meeting of the society (other than an adjourned meeting) by less than 21 or more than 42 days' notice expiring with the date of the meeting or, if earlier, the date specified by the society, under its rules, as the final date for the receipt of instruments appointing proxies to vote at the meeting.

(2) A meeting of a society called by a shorter notice than 21 days' notice shall be deemed to have been properly called if it is so agreed by the Central Bank on application being made to it in writing by the society.

(3) A society shall give notice of a meeting of the society—

(a) by sending to every person entitled to notice of the meeting a notice in such form as the Central Bank may direct, or

(b) with the consent of the Central Bank given where the Bank considers it proper in the circumstances, by publishing in at least 2 daily newspapers published in the State and circulating in the area in which the chief office of the society is situated a notice in such form as the Bank may direct.

(4) Where notice of a meeting is given in accordance with subsection (3) (b), any other requirement under this Act to send to members with the notice of or in connection with a meeting a proxy instrument, notice or other document shall be satisfied as respects it if either—

(a) it is published along with the notice, or

(b) the notice under subsection (3) (b) states that it may be obtained at all offices of the society during normal office hours,

as the Central Bank may direct.

(5) Notice of a meeting of a society shall be given to every member of the society eligible to vote on the date of the notice and to the Central Bank.

(6) Neither accidental omission to give notice of a meeting of a society to a person entitled to receive notice of the meeting nor the non-receipt by such a person of a notice of such a meeting shall invalidate the proceedings at that meeting.

69 Members' entitlement to vote on resolutions.

69.—(1) Subject to section 16 and this section, the persons entitled to vote on a resolution of a building society are—

(a) on a resolution, other than a conversion resolution, all the members who at the end of the last financial year of the society before the date of the meeting or the postal ballot, as the case may be, had held continuously shares to the value of not less than £100 for the preceding period of 6 months and continue to hold such shares on the voting date; and

(b) on a conversion resolution, all members within the meaning of paragraph (a) and all other persons who were borrowing members within the meaning of section 71 (2) at the end of the last financial year and continue to be so on the voting date.

(2) Subject to subsection (3), any provision in the rules of a society is void to the extent that it would have the effect of restricting the rights conferred by subsection (1) but nothing in this section implies that a society cannot in its rules grant voting rights to members of any description.

(3) On a vote on a resolution, which under this Act will not be effective unless it is passed as a special resolution or a conversion resolution, each member entitled to vote shall have one vote.

(4) In this section “voting date”, with reference to any resolution, means—

(a) the date of the meeting at which the resolution is moved, except where paragraph (b) applies; and

(b) where voting on the resolution is to be conducted by postal ballot, the date which the society specifies as the final date for the receipt of completed ballot papers.

70 Special resolutions.

70.—(1) No resolution of a building society shall be passed as a special resolution unless it is required to be so passed by or under this Act or by the rules of the society.

(2) A resolution of a society shall be a special resolution when it has been passed by a majority of such members of the society as, being entitled to do so—

(a) vote in person or by proxy on a poll on the resolution at a meeting of the society of which notice specifying the intention to move the resolution as a special resolution has been duly given; or

(b) vote in a postal ballot on the resolution of which notice specifying that the resolution will not be effective unless it is passed as a special resolution has been duly given.

(3) The terms of any special resolution before a general meeting of a society may be amended by ordinary resolution moved at the meeting if the chairman of the meeting is satisfied that the terms of the resolution as amended will still be such that adequate notice of the intention to move the resolution can be deemed to have been given.

71 Conversion resolutions.

71.—(1) A resolution of a society shall be a conversion resolution when it has been passed by a majority of such members of the society as, being entitled to do so—

(a) vote in person or by proxy on a poll on the resolution at a meeting of the society of which notice specifying the intention to move the resolution as a conversion resolution has been duly given; or

(b) vote in a postal ballot on the resolution of which notice specifying that the resolution will not be effective unless it is passed as a conversion resolution has been duly given.

(2) For the purposes of this section and Part XI a person is a borrowing member of a society at any time if at that time his indebtedness to the society is in respect of—

(a) a loan, made under the repealed enactments, secured by the mortgage of freehold or leasehold estate or interest in a house, or

(b) a housing loan,

and if, in either case, the amount of his mortgage debt is not less than £500 or such other amount as the Central Bank may, from time to time, prescribe by regulation.

72 Proxies.

72.—(1) A member of a building society who is entitled to attend and vote at a meeting of the society may appoint another person (whether a member of the society or not) as his proxy to attend, speak and, subject to subsection (2), to vote at the meeting instead of him, and may direct the proxy how to vote at the meeting.

(2) A proxy is entitled to vote on a poll but, subject to any provision in the rules of the society, not otherwise.

(3) In every notice calling a meeting of a society there shall appear with reasonable prominence a statement—

(a) that a member entitled to attend and vote may appoint a proxy to attend, speak and vote instead of him;

(b) that the proxy need not be a member of the society; and

(c) that the member may direct the proxy how to vote at the meeting.

(4) Every notice calling a meeting of a society shall have annexed to it one instrument for appointing a proxy for completion by the member if he wishes to appoint a proxy.

(5) Any provision in the rules of a society shall be void to the extent that it would have the effect of requiring the instrument appointing a proxy or any other document necessary to show the validity of, or otherwise relating to the appointment of a proxy to be received by the society or any other person more than 10 days before a meeting or adjourned meeting in order that the appointment may be effective at the meeting or adjourned meeting.

(6) The instrument appointing a proxy shall be in such form as the Central Bank may direct and the Bank may specify as respects a proxy instrument—

(a) matters to be included in or excluded from the instrument, and

(b) the declarations to be made in the instrument by the member appointing a proxy.

(7) Except at the written request of a member, no instrument for the appointment of a proxy shall be issued by a society or at the society's expense apart from the instruments issued under subsection (4).

(8) A society shall keep in a safe place for a period of one year from the date of their receipt all instruments appointing proxies and requests from members under subsection (7).

73 Right to demand a poll.

73.—(1) Any provision in the rules of a building society shall be void in so far as it would have the effect either—

(a) of excluding the right to demand a poll at a meeting of the society on any question other than the election of the chairman of the meeting or the adjournment of the meeting, or

(b) of making ineffective a demand for a poll on any such question which is made by not less than 10 members having the right to vote at the meeting.

(2) The instrument appointing a proxy to vote at a meeting of a society shall be deemed also to confer authority to demand or join in demanding a poll, and, for the purposes of subsection (1), a demand by a person as a proxy for a member or members shall be the same as a demand by the member or members.

74 Members' right to propose and circulate resolutions.

74.—(1) If 25 members, or such lesser number as may be specified in the rules of a building society, who are entitled to vote on a resolution, give notice in writing to the society of their intention to move, or to cause to be moved on their behalf, at an annual general meeting, a resolution (the text of which is included in the notice), other than a conversion resolution, it shall be the duty of the society, subject to subsections (2), (3) and (9)—

(a) to include in the notice of the annual general meeting a notice specifying the intention to move the resolution, or to cause it to be moved on their behalf, at the meeting and, where applicable, the intention to move it as a special resolution; and

(b) at the request of the members intending to move the resolution, or to cause it to be moved on their behalf, to send to each member entitled to receive notice of the meeting a copy of a statement of not more than 300 words with respect to the matter referred to in the resolution.

(2) Subsection (1) does not require a society to send notices of a resolution or copies of a statement to members of the society in any case where—

(a) the contents of the resolution or, as the case may be, the statement would be likely to diminish substantially public confidence in the society;

(b) the rights conferred by subsection (1) are being abused to seek needless publicity for defamatory matter or for frivolous or vexatious purposes; or

(c) if the resolution were passed, the society would be involved in activities likely to be ultra vires;

and that subsection shall not be taken to confer any rights on members, or to impose any duties on a society, in respect of a resolution or statement which does not relate directly to the affairs of the society.

(3) If the rules of a society so provide, subsection (1) does not require notice of a resolution to be given to members of the society if the resolution is in substantially the same terms as any resolution which has been defeated at a meeting or on a postal ballot during the period beginning with the third annual general meeting before the date on which notice of the resolution is given to the society.

(4) Where the society refuses, or proposes to refuse to give notice of a resolution or to send to members a statement submitted under subsection (1), it shall within 14 days after the receipt of the resolution notify the members who submitted it of such refusal and the grounds for the refusal and the said members may within 7 days of the refusal refer the refusal to the Central Bank who may direct the society to circulate the resolution or the statement subject to such conditions as the Bank may require.

(5) No copies of a statement with respect to a resolution shall be sent to members of a society if, on any of the grounds in subsection (2) or (3), the society does not give the notice of the resolution to them required by subsection (1) (a).

(6) Notice of a resolution given under subsection (1) must be given to the society not later than the last day of the financial year of the society preceding the financial year in which is held the annual general meeting at which it is intended to move the resolution and any statement to be sent to members under subsection (1) (b) must also be sent to the society not later than that day.

(7) The notice of a resolution and the copies of a statement required to be sent to members by subsection (1) (a) or (b) shall be sent to them in the same manner and (so far as practicable) at the same time as the notice of the annual general meeting at which the resolution is intended to be moved, and, where it is not practicable for them to be sent at the same time as the notice, they shall be sent as soon as practicable thereafter.

(8) Where notices of a resolution, or copies of a statement in respect of a resolution intended to be moved at a meeting are required to be sent to any persons, the proceedings at the meeting are not invalidated by—

(a) the accidental omission to send a notice or copy to a person entitled to receive one, or

(b) the non-receipt of a notice or copy by such a person.

(9) This section shall not apply to a special resolution where, in the case of a society which, under the repealed enactments, was entitled to issue shares to which voting rights did not attach—

(a) 75 per cent. of the holders of that class of shares, issued before 15 August, 1984, to which voting rights then attached consider that the resolution would, if passed, be unreasonable having regard to their interests;

(b) the shareholders referred to in paragraph (a), in accordance with the rules of the society, refer the question for arbitration and, for this purpose, the rules shall be deemed to be an arbitration agreement within the meaning of the Arbitration Acts, 1954 and 1980; and

(c) the arbitrator finds that the resolution would, if passed, be unreasonable having regard to the interests of the shareholders referred to in paragraph (a).

75 Postal ballots.

75.—(1) The rules of a building society may provide for the voting in an election of directors or on any resolution of the society to be conducted in all or in any particular circumstances by postal ballot; and in this Act “postal ballot”, in relation to an election, or a resolution of the society, means the postal ballot, if any taking place by virtue of those rules in the case of the election or the resolution in question.

(2) Where, under the rules of a society, a postal ballot is to take place, the following provisions of this section have effect.

(3) Notice of a postal ballot shall be given not less than 21 nor more than 42 days before the date which the society specifies as the final date for the receipt of completed ballot papers (referred to in this section as the “voting date”).

(4) Subject to the provisions of this Part, notice of a postal ballot shall be given to every member of the society who would be entitled to vote in the election or on the resolution if the voting date for the election or the resolution fell on the date of the notice.

(5) Notice of a postal ballot shall contain a ballot paper and such other notices relating to the election or resolution, and shall be accompanied by such other documents, as would be required to be given or sent to a member in connection with notice of a meeting, had it been intended to hold the election or vote on the resolution at a meeting instead of by postal ballot with the exception, however, of any notice relating to voting by proxy at a meeting.

(6) Accidental omission to give notice of a postal ballot, or to send any document required by subsection (5) to accompany such a notice, to a person entitled to receive it, or non-receipt of such a notice or document by that person, does not invalidate the postal ballot.

PART VII Accounts and Audit

76 Accounting records, systems of business control and keeping of title deeds.

76.—(1) A building society shall—

(a) cause proper accounting records to be kept on a continuous and consistent basis, and

(b) establish and maintain systems of control of its business and records and systems of inspection and report thereon,

in accordance with this section.

(2) The accounting records of a society shall be such as to—

(a) correctly record and explain the transactions of the society;

(b) disclose, with reasonable accuracy and promptness, the financial position of the society at any time;

(c) enable the directors properly to discharge the duties imposed on them by or under this Act and their functions of direction of the affairs of the society;

(d) enable the society properly to discharge the duties imposed on it by or under this Act; and

(e) enable the accounts of the society to be readily and properly audited.

(3) Without prejudice to the generality of subsection (1) or (2), accounting records kept pursuant to this section shall contain—

(a) entries from day to day of all sums of money received and expended by the society and the matters in respect of which the receipt and expenditure take place;

(b) a record of the assets and liabilities of the society and entries from day to day of every transaction entered into by the society which will or may give rise to liabilities or assets of the society; and

(c) in respect of the provision of services, a record of the services provided and of all the invoices relating thereto.

(4) For the purposes of subsection (1) proper accounting records shall be deemed to be kept if they comply with subsections (2) and (3), and give a true and fair view of the state of affairs of the society and explain its transactions.

(5) The systems of control which are to be established and maintained by a society pursuant to subsection (1) are systems for the control of the conduct of its business as required by or under this Act and in accordance with the decisions of the board of directors and for the control of the accounting and other records of its business and no such systems shall be treated as established or maintained unless there is kept available to the board a detailed statement in writing of the systems as in operation for the time being.

(6) The systems of inspection and report which are to be established and maintained by a society pursuant to subsection (1) are systems of inspection on behalf of, and report to, the board of directors on the operation of the systems of control of the society's business and records as required by subsection (5).

(7) Without prejudice to the generality of subsection (1), the systems of control and of inspection and report must be such as to secure that the society's business is so conducted and its records so kept that—

(a) the information necessary to enable the directors and the society to discharge their duties and functions is sufficiently accurate, and is available with sufficient regularity or at need and with sufficient promptness for these purposes; and

(b) the information obtained by or furnished to the Central Bank is sufficiently accurate for the purposes for which it is obtained and is available as required by the Bank.

(8) The accounting records of a society shall be kept at the chief office of the society or at such other place as the directors think fit and shall at all reasonable times be open to inspection by the directors.

(9) Every record required to be kept under this section shall be preserved by the society for a period of not less than 6 years after the latest date to which it relates.

(10) Where a society has subsidiaries, the society shall also secure that such accounting records are kept and such systems of control and of inspection and report are established and maintained by the society and the subsidiaries as will enable the society to comply with the requirements of this section in relation to the business of the society and those subsidiaries.

(11) Every society shall establish and maintain a system to ensure the safe custody of all documents of title belonging to the society and of deeds relating to property mortgaged to the society.

(12) (a) A society which contravenes this section or a director of a society or a chief executive who fails to take all reasonable steps to secure compliance by the society with this section or has, in the case of a director or chief executive, by his own wilful act been the cause of any default by the society thereunder, shall, in respect of each such failure or act, be guilty of an offence.

(b) In any proceedings under this subsection against a person for an offence of failing to take all reasonable steps to comply with this section it shall be a defence to prove that he had reasonable grounds for believing and did believe that a competent and reliable person was charged with the duty of ensuring such compliance and was in a position to discharge that duty.

77 Annual accounts.

77.—(1) The directors of a building society shall prepare in respect of each financial year of the society—

(a) an income and expenditure account giving a true and fair view of its income and expenditure for that year,

(b) a balance sheet giving a true and fair view of the state of its affairs as at the end of that year, and

(c) a statement of the source and application of funds giving a true and fair view of the manner in which its business has been financed and in which its financial resources have been used during that year,

and each of these shall be in such form and shall contain such particulars as the Central Bank may direct.