Provision is made in the Bank Act (sub-section 3 of Section 88) for the sale of goods, in case the bank finds it necessary to realize on its security, owing to the non-payment of the debt. A distinction is made between products of the forest and other goods. For the former the law requires that thirty days' notice should be given the pledger; if it concerns other goods, only ten days' notice of the time and place of sale is required. In both cases, however, the sale must be by public auction and after due advertising in at least two local papers. In the Province of Quebec one of the papers must be in French. If, however, the consent in writing of the pledger had been obtained the above procedure is unnecessary, and the sale can be proceeded with at convenience. (Figure 50.)
There are four penalties in the Bank Act which refer particularly to Sections 86-90. These are set forth in Sections 141-2-3-4. A bank is subject to a fine if it takes security for a pre-existing debt, or fails to comply with the requirements of the act in connection with the sale of goods in case of the default of the borrower. It is an indictable offense for any person to make a false statement in any warehouse receipt or pledge, or alienate any part of the bank's security under such pledge. The two latter clauses should be printed on the warehouse receipt or otherwise brought to the attention of those interested.