Part X Dissolution, Winding Up, Mergers and Transfer of Business

Transfer of business to commercial company

F1102B Protection of interests of beneficiaries in the case of trustee account holders.

1

This section shall have effect (notwithstanding anything to the contrary in the rules of the society) where the terms of the transfer of the business of a building society to its successor include provision for a distribution to be made to its members, and where more than one distribution is provided for, shall have effect in relation to each of them.

2

In this section “distribution” in relation to a society means—

a

a distribution among members of the society of part of the funds of the society or its successor, other than a distribution within section 100(2)(b), or

b

the conferring of rights in relation to shares in the successor on members of the society,

in consideration of the transfer.

3

Subject to the following provisions of this section and section 102C, a trustee account holder shall be treated by the society and its successor as not being disentitled from sharing in the distribution—

a

as such trustee account holder, and

b

also in relation to another account which he may hold as a trustee account holder or in relation to another account which he may hold otherwise than as a trustee account holder,

by reason only of his holding more than one account; and the terms of the transfer of business in question shall comply with this subsection.

4

A trustee account holder shall not be entitled to share in a distribution as such trustee account holder by virtue of any provision of this section if—

a

the society has notified that account holder that he must make, in relation to any account as respects which he is a trustee account holder, a statutory declaration under the M1Statutory Declarations Act 1835 complying with subsection (5); but

b

the trustee account holder does not give the society that declaration before such date as may be specified in the society’s notice to him.

5

A statutory declaration complies with this subsection if the person making it declares in it—

a

that he is a trustee account holder in respect of an account identified in the declaration,

b

the name and address of each beneficiary for whom he holds the account,

c

the reason why it is not reasonably practicable for any beneficiary to act in relation to that account himself, and

d

in a case where section 102D(8) applies, the names and addresses of all the trustee account holders of the account during the period referred to in that subsection.

6

In any case, where in response to a notice under subsection (4) (and within the time specified in that notice), a person gives a society a statutory declaration complying or purporting to comply with subsection (5) that he is a trustee account holder as respects any account he holds with that society then, subject to section 102C, the society and its successor—

a

shall treat him as such an account holder in respect of that account, and

b

shall not be liable to any other person in respect of any distribution to him (whether or not the society makes any enquiry into his eligibility before making the distribution).