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Chapter 3
Provisions as to debentures
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Liability of trustees for debenture holders
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104. (1) Subject to the provisions of this section, the following provision shall be void, namely, any provision contained—
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(a) in a trust deed for securing an issue of debentures, or
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(b) in any contract with the holders of debentures secured by a trust deed,
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in so far as it would have the effect of exempting a trustee of it from, or indemnifying him or her against, liability for breach of trust where he or she fails to show the degree of care and diligence required of him or her as trustee, having regard to the provisions of the trust deed conferring on him or her any powers, authorities or discretions.
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(2) Subsection (1) shall not invalidate—
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(a) any release otherwise validly given in respect of anything done or omitted to be done by a trustee before the giving of the release, or
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(b) any provision enabling such a release to be given—
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(i) on the agreement to the provision of a majority of not less than three-fourths in value of the debenture holders present and voting in person or, where proxies are permitted, by proxy at a meeting summoned for the purpose, and
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(ii) either with respect to specific acts or omissions or on the trustee dying or ceasing to act.
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