Building Societies Act, 1989

Supplemental provisions relating to memorandum and rules.

11.—(1) The provisions of the memorandum and rules of a building society, as read with the provisions of this Act and such regulations made thereunder as are in force for the time being, are binding upon—

(a) the society, every member and officer of the society; and

(b) all persons claiming on account of a member or under the rules;

and all such members, officers, and persons shall be taken to have notice of those provisions.

(2) The Central Bank may, in the interests of the orderly and proper regulation of building societies, by regulation—

(a) make further provision as respects the form and content of the memorandum and such provision may amend, extend or rescind any provision of Part I of the Second Schedule ;

(b) prescribe rules in respect of any of the matters in Part II of the Second Schedule or any of the following matters as respects housing loans or loans of the type referred to in section 6 (2) (a)

(i) the prohibiting or restricting of the charging of redemption fees;

(ii) the making available to a member to whom a loan is to be made of the report made under section 25 relating to the value of the security for the loan;

(iii) removing or restricting the right of a society to require a member to effect and keep effected insurance on the security for a loan with an insurer directed by the society or through the agency of the society or of any intermediary directed by the society;

(iv) precluding or restricting a society from requiring a member to pay its costs of legal investigation of title to the security;

(v) the arranging by a society through an insurer or intermediary nominated by it for the provision of mortgage protection insurance.

(3) Rules prescribed under subsection (2) (b) shall, with effect from one month after the commencement of the regulations, be part of the rules of any society to which they are declared to be applicable by the regulations, notwithstanding any provision of the rules of the society.

(4) Where the memorandum of a society registered before the commencement of regulations under subsection (2) (a) is not, in the opinion of the Central Bank, in accordance with any regulations under that subsection the Bank shall notify the society of its opinion within 6 months after the commencement of the regulations and in such a case the society shall forthwith take all necessary action to alter its memorandum accordingly within such time as the Bank may direct.

(5) If a society fails to comply with a notification by the Central Bank under subsection (4) the powers conferred on the Bank by section 40 shall become exercisable in relation to the society or the Bank may apply to have the society wound up under section 109 .

(6) A society shall supply to any person requiring them a copy of its memorandum and rules for such fee as may, from time to time, be fixed by the Central Bank.

(7) In this section “redemption fee” means, in relation to a loan, any sum in addition to principal and any interest due on such principal (without regard to the fact of the redemption of the loan) at the time of redemption of the whole or part of the loan.