Canada Student Loans Regulations (SOR/93-392)

• 28.1 (1) If a claim for loss is not payable by the Minister pursuant to section 7 of the Act but an event described in subsection 28(1) has occurred, the amount of the loss payable pursuant to section 7.1 of the Act shall, subject to this section and section 28.2, be determined in accordance with subsection 28(4) where, in any consolidated guaranteed student loan agreement or any other guaranteed student loan agreement entered into under these Regulations,

  • (a) the rate of interest provided in the agreement,

    • (i) for the period described in subsection 14(1) or (2) or subsection 16.3(1) or (2), as the case may be, and for the class of loans identified therein, exceeds the maximum annual rate of interest prescribed by that subsection that was in effect during that period, or

    • (ii) for the period described in subsection 15(1) or (2), as the case may be, and for the class of loans identified therein, exceeds the maximum annual rate of interest prescribed by that subsection that was in effect on the day on which the agreement was entered into;

  • (b) the principal amount provided in the guaranteed student loan agreement does not equal the principal amount determined in accordance with the Act and any regulations made thereunder; or

  • (c) the amount of the instalments to be made by the borrower provided in the agreement would either result in an overpayment or not pay the loan in full by the terms thereof.

• (2) Where subsection (1) applies, the lender shall complete any calculations or recalculations under this section that are requested by the Minister.

• (3) For the purposes of subsection (1), the unpaid balance of the principal amount of the loan referred to in paragraph 28(4)(a) is the lesser of

  • (a) the unpaid balance of the principal amount of the loan calculated as if the event referred to in subsection (1) had not occurred, and

  • (b) the unpaid balance of the principal amount of the loan calculated in accordance with the guaranteed student loan agreement.

• (4) For the purposes of subsection (1), the rate of interest required for the calculation set out in paragraph 28(4)(b) shall be the lesser of

  • (a) the rate of interest provided in the guaranteed student loan agreement, and

  • (b) the rate of interest determined in accordance with subsection 15(1) or (2), as the case may be, in effect on the day on which the guaranteed student loan agreement was entered into.

• (5) The Minister shall not make a payment under section 7.1 of the Act unless the absolute value of the difference between the amount determined in accordance with paragraph (3)(b) and the amount determined in accordance with paragraph (3)(a) is less than or equal to $250.

• 28.11 (1) If a lender has two or more claims for loss each of which is a claim for loss that could be made in accordance with section 28 or 28.1, instead of making the claims individually, the lender may group the claims together and submit them to the Minister in an electronic format acceptable to the Minister.

• (2) If the claims are submitted in that way, the documentation required under subsection 28(5) to substantiate the claims is not required to be submitted with the claims.

• (3) After receiving the claims, the Minister shall compare the information contained in the claims with the information in the Minister's files.

• (4) The Minister may decide not to accept a claim that cannot be verified by that comparison. If a claim is not accepted, the Minister shall notify the lender that the claim has not been accepted and shall tell the lender why the claim has not been accepted.

• (5) After setting aside the claims that are not accepted, the Minister may pay the lender the remaining claims. The payment is to be considered an advance payment, subject to being adjusted after those remaining claims are audited.

• (6) The Minister shall choose a sample of those remaining claims and shall request the lender to provide the Minister with the documentation required under subsection 28(5) to substantiate the claims in the sample. In that request, the Minister shall set out the time within which the documentation shall be provided.

• (7) If the documentation required to substantiate a claim is not provided to the Minister within the requested time, the Minister may decide not to accept the claim.

• (8) If a claim in the sample is not substantiated by the documentation that is provided to the Minister or if a claim fails to meet any other requirement of these Regulations, the Minister may decide not to accept the claim.

• (9) If the Minister is of the opinion that too many of the claims in the sample are not substantiated by the documentation that is provided to the Minister or fail to meet any other requirement of these Regulations, the Minister may decide not to accept any of the claims that were the subject of the lender's request for payment.

• (10) If the Minister decides under subsection (7), (8) or (9) not to accept a claim, the Minister shall notify the lender that the claim has not been accepted and shall tell the lender why the claim has not been accepted. On the day that the notification is sent to the lender, the advance payment made by the Minister to the lender in respect of the claim becomes a debt due to Her Majesty.

• (11) After the audit is concluded, if the Minister finds that an amount remains owing to the lender in respect of the claims that have been accepted, the Minister may pay that amount to the lender. If, on the other hand, the Minister finds that the advance payment made to the lender in respect of the claims that have been accepted is more than the amount to which the lender was entitled in respect of those claims, the Minister shall notify the lender that the advance payment in respect of those claims was excessive and shall tell the lender why it was excessive. On the day that the notification is sent to the lender, the amount of the excess becomes a debt due to Her Majesty.

• 28.12 (1) If the Minister decides under subsection 28.11(4) not to accept a claim for loss, the claim may be resubmitted to the Minister in accordance with subsection 28(1) or 28.1(1) or section 28.11.

• (2) If the Minister decides under subsection 28.11(7), (8) or (9) not to accept a claim for loss, the claim may be resubmitted to the Minister only in accordance with subsection 28(1) or 28.1(1).

28.13 The Minister may at any time request a lender to produce the original documents for any claim for loss filed by the lender.

28.14 [Repealed, SOR/2005-152, s. 2]

• 28.2 (1) Notwithstanding anything in section 28, 28.1 or 28.11, the Minister shall not make a payment under section 7 or 7.1 of the Act if, on or before the applicable day referred to in subsection (2),

  • (a) the borrower has been released from the debt obligation, or any part thereof, resulting from the borrower's guaranteed student loan; or

  • (b) the borrower has a legal defence to an action, whether or not an action has been commenced, on the debt obligation, or any part thereof, resulting from the borrower's guaranteed student loan, or Her Majesty's ability to recover has otherwise been jeopardized.

• (2) For the purposes of subsection (1), the applicable day is

  • (a) the day on which the lender submits its claim for loss under section 28, 28.1 or 28.11, if no previous claim for loss has been submitted; or

  • (b) the day on which the lender submits its claim for loss under section 28.1 or 28.11, if the lender has previously submitted a claim for loss under section 28 before the coming into force of this section and that claim has been rejected by the Minister.

Recoveries

• 29 (1) Where the Minister makes a payment to a lender pursuant to section 7 of the Act in respect of any guaranteed student loan, the lender shall, on behalf of Her Majesty, take such reasonable steps as the Minister may require to collect due payments of principal and interest, to realize on any security and to otherwise effect collection of the loan.

• (2) The Minister may retain the services of any person or organization to take appropriate action on behalf of Her Majesty to collect due payments of principal and interest, to realize on any security and to otherwise effect collection of the loan.

• (3) Any amount collected on behalf of Her Majesty shall be remitted to the Minister.

• (4) The Minister may pay to a lender, pursuant to section 8 of the Act, an amount equal to 20 per cent of any amount collected by the lender on behalf of Her Majesty from a borrower.

Administrative Measures — Prescribed Period

• 29.1 (1) Subject to subsection (2), for the purposes of paragraphs 18.1(1)(a), (c) and (d) of the Act, the prescribed period is as follows:

  • (a) if the amount of assistance awarded in excess of the amount to which the person would have otherwise been entitled is

    • (i) less than $4,000, one year,

    • (ii) $4,000 or more but less than $6,000, two years,

    • (iii) $6,000 or more but less than $8,000, three years,

    • (iv) $8,000 or more but less than $10,000, four years, and

    • (v) $10,000 or more, five years;

  • (b) if the person is not a qualifying student, five years; and

  • (c) if administrative measures have already been taken in respect of the person under section 18.1 of the Act or section 17.1 of the Canada Student Financial Assistance Act, five years.

• (2) If more than one period applies to the person under subsection (1), the prescribed period is the longest applicable period.

Subrogation

• 30 (1) Notwithstanding subsections 28(2) and (5), where, under the Act or these Regulations, the Minister pays to a lender the amount of loss sustained by the lender as a result of a guaranteed student loan, Her Majesty is subrogated in and to all the rights of the lender in respect of the guaranteed student loan and, without limiting the generality of the foregoing, all rights and powers of the lender in respect of

  • (a) the guaranteed student loan,

  • (b) any judgment obtained by the lender in respect of the loan, and

  • (c) any security held by the lender for the repayment of the loan,

  are vested in Her Majesty and Her Majesty is entitled to exercise all the rights, powers and privileges that the lender had or may exercise in respect of the loan, judgment or security, including the right to commence or continue any action or proceeding, to execute any release, transfer, sale or assignment, or in any way collect, realize or enforce the loan, judgment or security.

• (2) Where the Minister pays a claim for loss pursuant to section 7.1 of the Act, the Minister shall be subrogated in and to all the rights of the lender in accordance with subsection (1) to the extent of the amount of the payment made to the lender under that section, including interest accrued and accruing from the applicable day referred to in paragraph 28(4)(b) at the rate of interest determined in accordance with subsection 28.1(4) and the amounts determined in accordance with paragraphs 28(4)(c) and (d).

30.1 [Repealed, SOR/2009-212, s. 18]

30.2 [Repealed, SOR/2009-212, s. 18]

31 and 32 [Repealed, SOR/96-369, s. 27]

Reports to the Minister

• 33 (1) Every lender shall furnish to the Minister

  • (a) within the 30 days next following the last day of March and the last day of July of each year, a report showing the total of all guaranteed student loans made by the lender that are outstanding at the end of those months; and

  • (b) as frequently as the Minister may require, copies of all documents relating to outstanding guaranteed student loans made by the lender.

• (2) The Minister may require an appropriate authority for a province to provide a copy of any document that was issued by or on behalf of that appropriate authority in connection with a guaranteed student loan.

• (3) The Minister may require an appropriate authority for a province, to account to the Minister, during July of each year, in a manner satisfactory to the Minister, for the number of certificates of eligibility that were issued by it during the previous loan year.

• (4) The Minister may require a lender or an appropriate authority for a province to furnish the Minister with any relevant information respecting guaranteed student loans authorized by the appropriate authority.