Lawrence E. Thacker

The applicants, a lawyer and his law firm, sought judicial review to prohibit the Ontario Securities Commission from continuing proceedings against the lawyer under s. 127(1) of the Securities Act.

The Commission alleged the lawyer made misleading statements in a letter during a prospectus review.

The applicants and the Law Society of Upper Canada argued the Commission lacked jurisdiction to discipline lawyers acting in a professional capacity, asserting such power belonged exclusively to the Law Society and that the Commission's exercise of it violated the independence of the bar.

The Divisional Court dismissed the application, finding that s. 127(1) applies to lawyers and that the Commission's public interest jurisdiction to control its processes does not usurp the Law Society's role or infringe the rule of law.

The appellants appealed a decision certifying a class action regarding the Bre-X gold mine fraud.

The motion judge had restricted the common issues to conspiracy and fraud, declining to certify negligent misrepresentation as a common issue, and limited the class to shareholders who held shares on the date the possible fraud was publicly disclosed.

The Divisional Court dismissed the appeal, agreeing that negligent misrepresentation claims require individual inquiries into reliance and causation, making a class action not the preferable procedure for those claims.

The court also upheld the temporal restriction on the class, as shareholders who sold before the disclosure date could not have suffered losses caused by the misrepresentations.