New South Wales Consolidated Acts

CO-OPERATIVES ACT 1992 - SECT 81

81 Repayment of shares on expulsion

(1) When a member is expelled from a co-operative in accordance with its rules, the co-operative is to repay to the member the amount paid up on the shares held by the member at the date of expulsion, less any amount owed by the member to the co-operative at the date of expulsion under the rules of the co-operative or any contract or otherwise.

(2) If the balance sheet of the co-operative last issued before the expulsion of a member of the co-operative disclosed a loss or deficiency, there is to be a proportionate reduction in the capital to be repaid to the member.

(3) That reduction is to be by an amount that bears to the amount of the loss or deficiency so disclosed the same proportion as the number of shares held by the member bore to the total number of shares held by all members of the co-operative as at the date of expulsion of the member.

(4) Payment of any amount due to a member under this section is to be made at such time as may be determined by the board of the co-operative, but not later than 12 months after the date of expulsion.

(4A) However, if the board considers that repayment within 12 months would adversely affect the financial position of the co-operative, or the former member consents in writing:

(a) the board may defer payment until a later time determined by the board, or

(b) the co-operative may appropriate the amount as a donation to the co-operative, but only if the former member consents in writing to the donation.

(4B) If payment is deferred, the amount owing to the former member must be applied as follows:

(a) if the co-operative is a deposit-taking co-operative-the co-operative may apply the amount as a deposit by the former member with the co-operative (subject to the requirements of section 135 as to interest on the deposit and to the requirements of section 136),

(b) the co-operative may allot or issue debentures or CCUs of the co-operative to the former member in satisfaction of the amount.

(5) Shares in respect of which capital has been repaid are to be cancelled.