The plaintiffs sought leave under s. 138.8 of the Securities Act and certification under the Class Proceedings Act for a proposed securities class action.
The plaintiffs alleged that the defendants misrepresented the company's ability to maintain its dividend, causing shareholders and debenture-holders to sustain losses when the dividend was cut.
The court dismissed the leave motion, finding no reasonable possibility that the secondary market misrepresentation claims would succeed at trial, as the defendants' statements were based on a genuine belief in their growth strategy at the time.
The court also dismissed the certification motion, holding that a class proceeding was not the preferable procedure for the remaining common law negligent misrepresentation claims, which require individualized proof of reliance.
