(1)It shall be lawful for a society to which this Part of this Act applies to create by instrument in writing in favour of a bank a charge (hereinafter referred to as an agricultural charge) on all or any of the property hereinafter specified as security for sums advanced or to be advanced to it or paid or to be paid on its behalf under any guarantee by the bank and interest, commission and charges thereon.
(2)The property which may be affected by such a charge shall be the stocks of merchandise from time to time belonging to and in the possession of the society in pursuance of the objects which it has been formed to carry out.
(3)The principal sum secured by an agricultural charge may be either a specified amount, or a fluctuating amount advanced on current account not exceeding at any one time such amount (if any) as may be specified in the charge, and in the latter case the charge shall mot be deemed to be redeemed by reason only of the current account having ceased to be in debit.
(4)An agricultural charge may be in such form and made upon such conditions as the parties thereto may agree, and cautioners may be made parties thereto.