1. Rules and Regulations. The rules and regulations contained in this By-law are made in pursuance of the powers contained in the Act to Incorporate The Canadian Bankers' Association, 63 and 64 Vict. chap 93 (1900), and shall be adopted by, and shall be the rules and regulations governing all clearing houses now existing and established, or that may be hereafter established in Canada.

2. Every clearing house throughout Canada shall forward to the secretary-treasurer the usual weekly, monthly and yearly returns, and shall furnish such additional returns as the association may require from time to time.

The following are the rules and regu'ations respecting Clearing Houses:

1. Formation and Admission of Members.

(a) The Chartered Banks doing business in any city or town, or such of them as may desire to do so, may form themselves into a Clearing House. The Montreal City and District Savings Bank, located in Montreal, may be admitted to the privileges of the Montreal Clearing House.

(b) Chartered Banks thereafter establishing offices in such city or town may be admitted to the Clearing House as members thereof by receiving the affirmative vote of three-fourths of the members, certifying assent to the constitution, by-laws, rules and regulations, and by subscribing to all agreements in the same manner as the original members.

(c) The Assistant Receiver-General of the Dominion of Canada, located at any Clearing House point, may be admitted to the privileges of the Clearing House, but he shall have no voice in Us management.

2. Objects.

(a) The objects of the Clearing House shall be the facilitating at one place and at one time of the daily exchanges between the several members, the settlement of the balances resulting from such exchange and the promotion of the Interests of the members and the maintenance of conservative banking through wise and intelligent co-operation.

(b) The Clearing House shall not either directly or indirectly be used as a means of obtaining payment of any item, charge or claim disputed, or objected to. It is expressly agreed that any member receiving exchanges through the Clearing House shall have the same rights to return any item, and to refuse to credit any sum which it would have had were the exchanges made directly between the members concerned, instead of through the Clearing House, and nothing in these or any future rules, and nothing done, or omitted to be done thereunder, and no failure to comply therewith shall deprive a member of any rights it might have possessed had such rules not been made, to return any item or refuse to credit any sum; and payment through the Clearing House of any item, charge or claim shall not deprive a member of any right to recover back the amount so paid.

3. Meetings.

(a) The Annual General Meeting of the Members shall be convened for the election of officers, the Board of Management, the hearing of yearly reports, and for such other business as may be brought before it. The meeting shall be held on such day and at such time and place as the members may fix by by-law. A fine of five dollars shall be imposed by the Clearing House on any member failing to be represented at an Annual Meeting.

(b) Special General Meetings may be convened by the Chairman or Vice-Chairman, whenever it may be deemed necessary, or on the written requisition of at least three members.

(c) Special General Meetings may be convened by the Chairman or Vice-Chairman, on (the written requisition of any member on giving fifteen days' notice.

4. Votes of Members.

(a) Each member may be represented at all general meetings by one or more of its principal officers and shall be entitled to one vote.

(b) At all general meetings a quorum for the transaction of business shall consist of a majority of the whole number of members.

5. Board of Management.

(a) At every annual meeting of the members there shall be elected by ballot a Board of Management which shall hold office until the next Annual Meeting after its election, or until its successor is appointed.

The Board of Management shall consist of the Chairman, Vice-Chairman, and a Committee, all of whom shall be chosen from among the resident General Managers, and Assistant General Managers, the Managers and Acting Managers of the main offices of the various members. The number of members of such board and the quorum thereof shall be fixed by by-law.

(b) In the absence of any person having a seat on the Board of Management, he may be represented by another officer of the member of which he is an officer.

(c) Meetings of the Board of Management may be held at such times as the members of such Board may determine. A special meeting shall be called by the Secretary-Treasurer on the written requisition of at least three members of the Clearing House for the consideration of any matter submitted by it, of which meeting twenty-four hours' notice shall be given, but if such meeting is for action under Rules 15 or 16, it will be called immediately.

(d) The Board of Management shall have power from time to time to appoint an officer to act as Manager of the Clearing House and to remove him from office, and to fix his remuneration and the terms of his engagement.

(e) The Board of Management shall secure suitable rooms for the Clearing House, and provide proper books, stationery, furniture, and whatever else may be necessary for the convenient transaction of business. It shall also deal with the expenses of the Clearing House, make assessments on the members for their share of the expenses, and exercise general control over Clearing House affairs.

(f) If a vacancy occur in the Board of Management the remaining members thereof shall have the power to fill such vacancy.