NEWFOUNDLAND REGULATION 84/00

CNR 1114/96
as amended

1. (1) Section 2 of the Private Training Institutions Regulations is amended by adding immediately after paragraph (a) the following:

(a.1) "campus" means

(i) a single premise at which one or more courses of study are provided by a private training institution, or

(ii) 2 or more premises at which courses of study are provided by a private training institution and which the superintendent considers, due to the proximity of the premises, to be a campus;

(2) Paragraph 2(b) of the regulations is repealed.

(3) Paragraph 2(g) of the regulations is repealed and the following substituted:

(g) "diploma" means a document awarded to candidates who successfully complete a post-secondary education course of study of at least 12 weeks or 360 instructional hours duration and which certifies the number of institutional hours of that course of study;

(4) Section 2 of the regulations is amended by adding immediately after paragraph (j) the following:

(j.1) "security" means a surety bond or irrevocable letter of credit or, in the discretion of the minister, a combination of a surety bond and an irrevocable letter of credit, which is of full force and effect for the purpose of

(i) securing performance of student contracts entered into by the operator, and

(ii) fulfilling obligations imposed by these regulations

from a surety company or financial institution acceptable to the minister;

(5) Paragraph 2(k) of the regulations is amended by deleting the number "13" and substituting the number "12" and by deleting the word "and" at the end of that paragraph.

(6) Section 2 of the regulations is amended by adding immediately after paragraph (k) the following:

(k.1) "tuition fees" includes money paid by sponsors or third parties on behalf of a student; and

2. (1) Section 4 of the regulations is amended by adding immediately after subsection (1.1) the following:

(1.2) Notwithstanding subsection (1.1), the superintendent shall, every 3 years from the approval of a course of study under that subsection, review every course of study of an institution based on the criteria prescribed by paragraphs (1.1)(a) to (e) and make those requirements that he or she considers necessary.

(1.3) Notwithstanding subsections (1.1) and (1.2), the superintendent may, in his or her discretion, undertake an assessment of any approved course of study offered by a private training institution at any time.

(2) Paragraph 4(2)(f) of the regulations is amended by deleting the phrase "a security bond" and substituting the phrase "the security".

(3) Paragraph 4(4)(a) of the regulations is repealed and the following substituted:

(a) the security or evidence of the continuation of that security as required under subsection 10(1); and

3. Subsection 5(4) of the regulations is repealed and the following substituted:

(4) The registration of a private training institution may be cancelled

(a) upon request in writing of the registrant in the form prescribed by the minister;

(b) where a keeper or operator of a private training institution ceases to operate the institution; or

4. Section 10 of the regulations is repealed and the following substituted:

Security

10. (1) In this section and in sections 10.01 and 10.02, "train-out" means a course of study undertaken by a student at a private training institution in substitution for a course of study the student was undertaking but had not finished at a private training institution that has closed or no longer offers the course of study.

(2) A private training institution shall obtain security in the minimum amount of $50,000 or 15% of the institution's total tuition revenue to the nearest $1,000 from the previous academic year, whichever is greater.

(3) The maximum amount for the security

(a) as of January 1, 1999 shall be $100,000;

(b) as of January 1, 2000 shall be $125,000; and

(4) Subsections (2) and (3) shall apply to a private training institution upon registration, re-registration or reinstatement of that private training institution.

(5) An applicant for one or more licences to provide one or more courses of study shall submit separate security for each campus at which the applicant intends to provide a course of study.

(6) Where the minister accepts as security a combination of a surety bond and an irrevocable letter of credit and that security is forfeited, the total amount of both the surety bond and the irrevocable letter of credit shall be distributed according to these regulations.

(7) For the purpose of claims referred to in subsection (9) every security shall continue in force and shall remain on deposit for a period of 2 years following the cancellation of the registration or the security.

(8) Where the security or the registration has been cancelled and the security has not been forfeited, the minister may,

(a) 2 years following the cancellation of the registration to which the security relates; or

(b) 2 years after the cancellation of the security,

deliver the security to the person bound under it and to the person who deposited that security.

(9) The security referred to in subsection (2) and (3) is forfeited and the amount of the security becomes due and payable as a debt to the Crown and the minister may call upon the surety company or financial institution to satisfy

(a) an amount owing to a student

(i) where a keeper or operator of a private training institution fails to make the repayment of fees to a student prescribed by sections 17 and 18,

(ii) where a registrant has been convicted of

(A) an offence under the Act, or

(B) an offence involving fraud or theft or conspiracy to commit an offence involving fraud or theft under the Criminal Code and where the conviction has become final,

(iii) where proceedings by or in respect of a registrant have been taken under the Bankruptcy Act (Canada) either by way of assignment or by petition or where proceedings have been taken by way of winding-up and in the case of a petition a receiving order under the Bankruptcy Act (Canada) or a winding up order has been made and the order has become final, or

(iv) where during the 2 year period referred to subsection (7) the minister receives notice in writing of a claim against the registrant by or on behalf of a student in respect of a course of study or a contract for a course of study together with evidence satisfactory to the minister as to the validity of the claim or that legal proceedings have been commenced against the registrant; and

(b) an amount paid by the minister or the corporation to facilitate train-out of students of a closed private training institution including

(i) money paid to other private training or educational institutions to replace tuition fees paid by a student to a private training institution for which services were not received before the closure of the institution or cancellation of the security or the registration, and

(ii) money paid to other private training or educational institutions for costs incurred by those institutions to complete student training which was interrupted or terminated as a result of the closure of a private training institution.

(10) Where the Crown becomes a creditor or a person in respect of a debt due the Crown arising from the provisions of subsection (9), the minister may take proceedings that he or she considers appropriate under the Bankruptcy Act (Canada), the Judicature Act, the Corporations Act or the Winding-Up Act (Canada) for the appointment of an interim receiver, custodian, trustee, receiver or liquidator.

Distribution of sufficient proceeds

10.01 Where

(a) a judgment based on a claim in respect of a course of study or a contract for a course of study is obtained by a student and filed with the minister; or

(b) the minister or the corporation provides evidence satisfactory to the superintendent as to the validity of a claim

the superintendent may, within 6 months of the forfeiture, pay over the money recovered under the security.

Distribution of insufficient proceeds

10.02 (1) Where the proceeds of the security are insufficient to satisfy the total amount of all claims filed with the minister within the 6 month period from the date of forfeiture mentioned in subsection 10(9), the superintendent shall distribute the proceeds of the security among the claimants as required by this section.

(2) Where the claimants to the proceeds of the security comprise

(a) students referred to in subparagraph 10(9)(a)(i) who are entitled to a repayment of fees under these regulations but whose entitlement did not arise upon the closure of a private training institution;

(b) students referred to in section 10.01 whose claim arose upon the closure of a private training institution and who did not participate in train-out facilitated by the corporation or the minister; or

the proceeds shall be distributed in the following order of priority:

(d) firstly, proceeds shall be distributed proportionally among students based upon

(i) the amount of repayment of fees owing to a student under section 17 or 18 of these regulations for which he or she has obtained judgment, or

(ii) the amount of tuition fees each paid to a private training institution, including an institution that closed prior to the completion of a course of study by the student and an institution whose security or registration has been cancelled, for which he or she has obtained judgment;

(e) secondly, where proceeds remain after distribution under paragraph (d), those proceeds shall be distributed to the minister or the corporation in the amount paid by the minister or the corporation to replace tuition fees paid by a student to a private training institution for services which the student did not receive before the closure of that institution or the cancellation of the security or the registration of the institution;

(f) thirdly, where proceeds remain after distribution under paragraph (e), those proceeds shall be distributed proportionally among students for claims for amounts, other than tuition fees, for which they have obtained judgment; and

(g) finally, where proceeds remain after distribution under paragraph (f), those proceeds shall be paid to the minister or the corporation for costs incurred by the minister or the corporation to facilitate the train-out of the students.

(3) A student who may receive a distribution of proceeds under paragraph (2)(f) shall also include a student who participated in train-out and who obtained judgment for a claim for amounts other than tuition fees.

(4) A claim by a student under paragraph (2)(d) or (f) or subsection (3) shall include reasonable legal expenses incurred by the student to obtain judgment, as determined by the superintendent.

(5) Where proceeds remain after distribution under this section, the remainder shall be paid to the security company or the financial institution from which the security was obtained.

Time limit

10.03 Only judgments of creditors that have become final before the expiration of the 6 month period from the date of forfeiture mentioned in section 10.01 shall be eligible to share in the proceeds of the security.

Payment into court

10.04 Notwithstanding section 10.03, the superintendent may pay to the Trial Division from the proceeds of the security an amount payable under these regulations to a creditor where a judgment has been obtained but has not become final before the expiration of the 6 month period from the date of forfeiture and that amount shall be held in trust for the creditor until the judgment becomes final.

Claims by students

10.05 Sections 10.03 and 10.04 apply to claims by students only.

Payment directly on student loan

10.06 (1) An amount a student is entitled to receive under section 10.01 or 10.02 shall

(a) firstly, be applied against a Newfoundland and Labrador student loan; and

(b) secondly, be applied against any other student loan

which the student has obtained from a financial institution in relation to a course of instruction that the student is unable to complete because of closure of the institution or cancellation of its security or registration.

(2) The superintendent shall pay the amount referred to in subsection (1) directly to the financial institution.

(3) Notwithstanding subsection (1), where a student has received proceeds of security for legal expenses incurred in obtaining a judgment under paragraph 10.02(2)(d), (f) or subsection 10.02(3), those proceeds shall first be paid to satisfy legal expenses allowed under paragraph 10.02(4).

Application of certain provisions

10.07 Paragraph 10(9)(b) and sections 10.1 to 10.6 apply to any security required under the Act and these regulations, including any security forfeited but not distributed at the time of the coming into force of this section.

5. Section 18 of the regulations is amended by adding immediately after subsection (4) the following:

(5) Where a student withdraws from a course of instruction 21 days after the commencement of a semester, a private training institution may impose an administrative fee of 10% of that semester's tuition, to a maximum of $500.

6. Section 26.2 of the regulations is amended by adding immediately after subsection (3) the following:

(4) For the purpose of this section, where tuition fees are included in grant money received by an institution on behalf of a student, the superintendent shall determine that portion of the grant which shall be considered to be tuition fees.

(5) Notwithstanding paragraph 5(4)(c), where a private training institution fails to pay to the corporation the contribution required under this section, the minister may, in his or her discretion, revoke or limit the right of that institution to enrol new students.