Marginal note:Transactions effected by entries in records of clearing house

• 8. (1) A transaction related to a depository bill or note recorded by a clearing house, or related to an interest in such a depository bill or note, may be effected by the making of appropriate entries in the records of the clearing house.

• Marginal note:Effect of transactions

  (2) The transaction has the same effect as a delivery of a bill of exchange in bearer form under the Bills of Exchange Act.

• Marginal note:Applicable law

  (3) The transaction, including the time it takes effect, is governed by the laws of the jurisdiction agreed to by the clearing house and its participants.

• Marginal note:Possession

  (4) A participant in whose favour the transaction is effected is deemed to be in possession of the depository bill or note. If the transaction relates to an interest in a depository bill or note, the participant in whose favour the transaction is effected is deemed to be in possession of a depository bill or note representing the interest.

Marginal note:Fungible bulk of depository bills or notes

• 9. (1) Transactions related to like depository bills or notes, or related to interests in like depository bills or notes, may be recorded by a clearing house as part of a fungible bulk and the entries may refer merely to a quantity of like depository bills or notes.

• Marginal note:Entries on net basis

  (2) When there is more than one transaction in depository bills or notes that are part of a fungible bulk, a clearing house may make entries in respect of those transactions on a net basis.

• Marginal note:Fungible bulk

  (3) For the purposes of this section, "fungible bulk" means a bulk of depository bills or notes of which any unit is, by usage of trade, the equivalent of any other unit.

Marginal note:Errors in records

10. Errors in the records of a clearing house do not affect the validity or effect of the entries or the liabilities or obligations of the clearing house to persons adversely affected by the errors.

Marginal note:Liability of acceptor

11. The acceptor of a depository bill is liable to provide the clearing house to which it is payable with funds so that the clearing house can pay, on the depository bill’s due date and in accordance with its terms, the participants who have an interest in the depository bill.

Marginal note:Liability of drawer

12. If a depository bill is dishonoured by the acceptor, the drawer is liable to pay the amount of the depository bill to the clearing house to which it is payable.

Marginal note:Liability of endorser of depository bill

13. If a depository bill is dishonoured by the drawer and acceptor, every endorser is jointly and severally liable to pay the amount of the depository bill to the clearing house to which it is payable.