Third

Session, 46th General Assembly

Elizabeth II, 2010

BILL 34

AN ACT TO AMEND THE

MORTGAGE

BROKERS ACT

Received and Read the First Time ...................................................................................................

Second Reading .................................................................................................................................

Committee ............................................................................................................................................

Third Reading .....................................................................................................................................

Royal Assent ......................................................................................................................................

HONOURABLE

HARRY HARDING

Minister

of Government Services

Ordered

to be printed by the Honourable House of Assembly

EXPLANATORY NOTES

This Bill would amend the Mortgage Brokers Act to

clarify that the Registrar of

Mortgage Brokers may delegate his or her powers and functions to the Deputy Registrar

of Mortgage Brokers;

add a provision to the Act to

allow the registrar to appoint persons to conduct examinations under the Act,

and to authorize those examinations where required to determine compliance with

the Act and the regulations;

expand the scope of search and

seizure provisions to include the authority to enter and search private

dwellings and seize documents and other items;

provide authority for a person

appointed by the registrar to summon and enforce the attendance of a person and

to compel that person to testify, and to summon and compel a person or company

to produce documents and other things in the context of an examination or

investigation under the Act;

provide authority for a judge

to issue a production order requiring a person, other than a person who is the

subject of an investigation, to produce documents in his or her possession

concerning a violation of the Act or the regulations;

provide authority for the registrar

to issue an order of protection requiring a person or company having funds on

deposit or under its control not to disburse or use the money until the order

is lifted;

make it an offence to obstruct

or interfere with a lawful investigation or examination;

increase penalties that the

court may impose;

provide authority for a judge

to order restitution where the Act or the regulations have been violated; and

set a 2 year limitation period

for prosecutions under the Act.

A BILL

AN ACT TO AMEND THE MORTGAGE

BROKERS ACT

Analysis

S.3 Amdt.

Registrar

S.6.1 Added

Examination

S.7 R&S

Investigation

Ss.7.1 to 7.3 Added

7.1 Powers of examiner or investigator

7.2 Production order

7.3 Protection order

5. S.14 R&S

Offence

6. S.15 R&S

Limitation period

Be it enacted by the Lieutenant-Governor and

House of Assembly in Legislative Session convened, as follows:

RSNL1990 cM-18 as

amended

1. Subsection 3(2) of the Mortgage Brokers Act is repealed and the following substituted:

(2) The Lieutenant-Governor in Council may

appoint a Deputy Registrar of Mortgage Brokers

(

a) to act in place of the registrar in his or her

absence or incapacity; and

(

b) to exercise the powers and perform the duties

of the registrar under this Act or the regulations that may be assigned by the

registrar.

2. The Act is amended by adding immediately after

section 6 the following:

Examination

6.1

(1) The

registrar may appoint persons to conduct examinations under this Act.

(2) Where it is reasonably necessary to ensure

compliance with this Act or the regulations, a person appointed by the registrar

under subsection (1) may, for the purpose of conducting an examination, at reasonable

times enter the premises of a mortgage broker and

(

a) require the production of books, records or

other documents applicable to the operations of that mortgage broker under this

Act or the regulations and may examine those books, records or documents or

remove them for the purpose of making copies of them;

(

b) interview employees of a mortgage broker to

determine if the mortgage broker is complying with this Act and the regulations;

and

(

c) inquire into all matters relating to the

operations of the mortgage broker under this Act and the regulations.

(3) A mortgage broker whose premises is entered

under subsection (1) and a person found there shall give the person conducting

the examination reasonable help to enable that person to carry out his or her

duties and functions under this Act and shall provide the information that he

or she may reasonably require.

(4) Where a person conducting an examination under

subsection (1) removes books, records or other documents under paragraph (1)(a),

he or she shall give to the person from whom those items were taken a receipt

for those items and shall immediately make copies of those items and return the

originals to the person who was given the receipt.

(5) The registrar may require the annual

examination of a mortgage broker under this

section or more frequent

examinations where he or she considers it necessary.

Section 7 of the Act is repealed and the

following substituted:

Investigation

(1) The

registrar may appoint persons to conduct investigations under this Act.

(2) Where a person appointed under subsection

(1) or subsection 6.1(1) believes on reasonable grounds that a person is contravening

or has contravened this Act or the regulations, that person may, with a warrant

issued under subsection (3), enter those premises and seize anything that may

provide evidence of the contravention.

(3) A judge of the Provincial Court or the Trial

Division who is satisfied on oath or affirmation that there are reasonable

grounds for believing that a contravention of this Act or the regulations has occurred,

or is occurring, may issue a warrant authorizing the person named in the warrant

to enter the private or public premises, including a dwelling house, and to

(

a) search;

(

b) examine the contents of the premises and make

those inquiries that the person considers necessary; and

(

c) copy, extract, photograph, video, seize and

take away evidence, books and records

for the purpose of investigating the

suspected contravention.

(4) A mortgage broker and the owner or operator of

private or public premises referred to in this

section and a person found there

shall not obstruct the person named in the warrant in its execution.

4. The Act is amended by adding immediately after

section 7 the following:

Powers of examiner

or investigator

7.1

(1) A

person appointed by the registrar to conduct an examination or an investigation

has the same power to summon and enforce the attendance of a person and to

compel him or her to testify on oath or otherwise, and to summon and compel a

person or company to produce documents and other things, that is vested in a

judge of the Trial Division, and the refusal of the person to attend or to

answer questions or of a person or company to produce documents or other things

that are in his, her or its custody or possession makes the person or company liable

to be committed for contempt by a judge of the Trial Division as if in breach

of an order of that court.

(2) A person or company giving evidence under

subsection (1) may be represented by counsel and may claim a privilege to which

the person or company is entitled.

Production order

7.2

(1) A

judge of the Provincial Court or a judge of the Trial Division may order a

person, other than a person who is the subject of an investigation,

(

a) to produce a document or a copy of a document,

certified by affidavit to be a true copy, or to produce data; or

(

b) to prepare a document based on a document or

data already in existence and to produce it.

(2) An order referred to in subsection (1) shall

require the document or data to be produced within the time, at the place and

in the form specified and to be given to a person appointed by the registrar to

perform an investigation or examination under this Act.

(3) A judge may make an order referred to in

subsection (1) where he or she is satisfied on the basis of an application made

in writing on oath or affirmation and without notice that there are reasonable

grounds to believe that

(

a) a person has contravened or is contravening

this Act or the regulations or is suspected to have contravened this Act or the

regulations;

(

b) the document or data will provide evidence

respecting a contravention or suspected contravention of this Act or the regulations;

and

(

c) the person who is subject to the order has

possession or control of the document or data.

(4) An order referred to in subsection (1) may

communication between a lawyer and his or her client.

(5) The order referred to in subsection (1) may be

revoked, renewed or varied.

(6) A copy of a document produced under this

section, on proof by affidavit that it is a true copy, is admissible in

evidence in proceedings under this Act and has the same probative force as the

original document would have if it had been proved in the ordinary way.

(7) Copies of documents produced under this

section are not required to be returned to the person who provided them.

Protection order

7.3

(1) Where

the registrar considers it necessary for the administration of this Act, the registrar

may direct a person, having on deposit or under his or her control or for

safekeeping funds of a person, to retain those funds and to hold them until the

registrar in writing revokes the direction or consents to release a particular

fund from the direction, or until a judge of the Trial Division orders

otherwise.

(2) A direction under subsection (1) that names a

bank or other financial institution shall apply only to a branch of the bank or

other financial institution identified in the direction.

(3) As soon as practicable, and not later than 7

days after a direction is issued under subsection (1), the registrar shall

apply to a judge of the Trial Division to continue the direction or for another

order that the judge considers appropriate.

(4) A direction under subsection (1) may be made

without notice but, in that event, copies of the direction shall be sent

immediately by means that the registrar may determine to all persons named in

the direction.

Section 14 of the Act is repealed and the

following substituted:

Offence

(1) A person shall not interfere with or obstruct a person in

the course of a lawful investigation or examination under this Act or the

regulations.

(2) A person who contravenes a provision of this

Act or the regulations is liable on

summary conviction to a fine of not more

than

(a) $100,000; or

(

b) an amount equal to 3 times the amount obtained

by the person as a result of the offence, whichever is greater,

or to a term of imprisonment of not more

than 2 years, or to both a fine and imprisonment.

(3) Where a person is convicted of an offence

under this Act or the regulations, the court making the conviction may, in

addition to another penalty, order the person convicted to pay compensation or

restitution.

Section 15 of the Act is repealed and the

following substituted:

Limitation period

15. A

prosecution under this Act or the regulations shall not be started more than 2

years from date the offence was discovered by the registrar.

Earl G. Tucker, Queen's Printer