CITATION: Sawh v. Ontario Securities Commission, 2013 ONSC 4018

DIVISIONAL COURT FILE NO.: 416/12

DATE: 20130612

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Molloy, Swinton and Sachs JJ.

BETWEEN:

SANJI SAWH and VLAD TRKULJA

Appellants

– and –

ONTARIO SECURITIES COMMISSION

Respondent

Janice Wright and Greg Temelini, for the Appellants

Swapna Chandra, for the Respondent

HEARD at Toronto: May 14, 2013

Sachs J.:

REASONS FOR DECISION

Overview

[1] Both Appellants worked in the securities industry from the mid-1990s until 2010. In 2003 they founded Investment House of Canada (“IHOC”), a mutual fund and exempt market dealer. IHOC was a member of the Mutual Fund Dealers’ Association (“MFDA”), which is a self-regulatory organization (“SRO”) recognized by the Ontario Securities Commission (“the Commission”) under s. 21.1(1) of the Securities Act, R.S.O. 1990, c. S.5.

[2] Following an investigation into IHOC by the MFDA, the MFDA issued a Notice of Hearing in 2009 for a disciplinary proceeding in relation to 13 allegations of violations of the MFDA Rules, By-laws or Policies. A settlement negotiation ensued as a result of which a settlement agreement (“the Settlement Agreement”) was entered into. The Settlement Agreement involved the resignation of IHOC from the MFDA as well as its winding down. It also involved admissions on the part of the Appellants regarding 11 contraventions of the MFDA Rules, By-laws or Policies. The Settlement Agreement was approved by a hearing panel of the MFDA.

[3] A formal consequence of the IHOC’s suspension from the MFDA was the suspension of the registration of both the Appellants as dealing representatives of mutual fund dealers. Six weeks after the Settlement Agreement, the Appellants applied to have their registrations as dealing representatives reinstated. The Deputy Director of the Commission denied their request and the Appellants requested a review of the Deputy Director’s decision. After an oral hearing de novo that extended over six days before two commissioners, the Commission applied the criteria for registration found in ss. 27(1) and (2) of the Securities Act and concluded that the Appellants lacked the requisite proficiency and integrity to be registered as dealing representatives of a mutual fund dealer and that the reinstatement of their registrations would be otherwise objectionable.

[4] This is an appeal from that decision. Central to the Appellants’ position on this appeal is their argument that the decision of the Commission undermined the coherence of the securities regulatory regime by not according sufficient deference to the Settlement Agreement that was approved by the MFDA. According to the Appellants, the Settlement Agreement contemplated that both Appellants would be able to reinstate their registrations as dealer representatives of a mutual fund dealer.

[5] For the reasons that follow I would dismiss the appeal. Fundamental to my decision is the fact that the Commission has not delegated decisions about registration to the MFDA and that the MFDA made no findings on the issues that the Commission had to decide when it declined to reinstate the Appellants’ registrations.

Jurisdiction and Standard of Review

[6] Section 9 of the Securities Act provides that a person directly affected by a final decision of the Commission may appeal to the Divisional Court. Under s. 9(5) the court is authorized to direct the Commission to make any decision or do any act within its authority that the court considers proper.

[7] Both parties agree that the Commission’s decision in this case is subject to review on the standard of reasonableness: Taub v. Investment Dealers Association of Canada, 2009 ONCA 628, 98 O.R. (3d) 169.

The Legal Relationship Between the Commission and the MFDA

The Securities Act and Recognition of an SRO

[8] The Commission’s statutory mandate expressly includes the power to recognize and oversee SROs in the Province of Ontario where it is satisfied that to do so would be in the public interest. The Commission’s authority to recognize an SRO is contained in s. 21.1(1) of the Securities Act, which states:

The Commission may, on the application of a self-regulatory organization, recognize the self-regulatory organization if the Commission is satisfied that to do so would be in the public interest.

[9] There are two recognized SROs that operate on the national level: the MFDA and the Investment Industry Regulatory Organization of Canada (“IIROC.”) Both SROs derive their jurisdiction from the contract with their members and from being recognized by the provincial securities commissions. Broadly speaking, the SROs prescribe codes of conduct and business practices for their members and may discipline their members through the imposition of monetary penalties and/or the permanent or temporary suspension of their membership in the SRO.

Registration Authority Not Delegated to the MFDA

[10] Section 21.5(1) of the Securities Act authorizes the Commission to delegate to the SROs the Director’s discretion to grant or refuse a registration application. The Commission has delegated the Director’s discretion to grant or refuse a registration application to IIROC. No such delegation has been made to the MFDA. Accordingly, s. 6(c) of the MFDA Recognition Order expressly requires member firms to confirm to the MFDA that persons it wishes to “sponsor, employ or associate with as an individual approved person” are properly registered with the Commission.

Requirements to Deal in Securities in Ontario

[11] In Ontario persons or companies who wish to trade in securities must be registered with the Commission pursuant to the Securities Act. In respect of mutual funds, people who are registered with the Commission must also be approved by a “sponsoring firm” who is a registered member of the MFDA. An individual who is registered with a sponsoring firm that is a registered dealer is known as a “dealing representative.”

[12] A dealing representative of a registered mutual fund dealer is said to be a “dealing representative in the category of mutual fund dealer.” Dealing representatives of a registered exempt market dealer (“EMD”) are described as dealing representatives in the category of exempt market dealer. The Appellants sought registration as dealing representatives in the category of mutual fund dealer and not in the EMD category.

The Securities Act and the Role of the Commission

[13] Section 1.1 sets out the purposes of the Securities Act. They are:

(a) to provide protection to investors from unfair, improper or fraudulent practices; and

(b) to foster fair and efficient capital markets and confidence in capital markets.

[14] The Supreme Court of Canada has described the Commission as having a “very wide discretion” to “intervene in activities related to the Ontario capital markets when it is in the public interest to do so”: Committee for the Equal Treatment of Asbestos Minority Shareholders v. Ontario (Securities Commission), 2001 SCC 37, [2001] 2 S.C.R. 132, at para. 39.

The Law on Registration: Determining Suitability

[15] Subsections 27(1) and (2) of the Securities Act set out the factors that are to be considered by the Director in exercising his or her discretion to grant or refuse an application for registration:

27. (1) On receipt of an application by a person or company and all information, material and fees required by the Director and the regulations, the Director shall register the person or company, reinstate the registration of the person or company or amend the registration of the person or company, unless it appears to the Director,

(a) that, in the case of a person or company applying for registration, reinstatement of registration or an amendment to a registration, the person or company is not suitable for registration under this Act; or

(b) that the proposed registration, reinstatement of registration or amendment to registration is otherwise objectionable.

(2) In considering for the purposes of subsection (1) whether a person or company is not suitable for registration, the Director shall consider,

(a) whether the person or company has satisfied,

(i) the requirements prescribed in the regulations relating to proficiency, solvency and integrity, and

(ii) such other requirements for registration, reinstatement of registration or an amendment to a registration, as the case may be, as may be prescribed by the regulations; and

(b) such other factors as the Director considers relevant.

[16] Subsection 27(2) establishes three suitability criteria: proficiency, solvency and integrity. At issue on this appeal are the Appellants’ proficiency and integrity. As well, the Commission found that the reinstatement of the Appellants’ registration was “otherwise objectionable” within the meaning of s. 27(1) (b).

The MFDA Proceedings

[17] The Appellants were the founders, owners, directors and officers of IHOC. As part of IHOC’s business, the Appellants were selling exempt market securities that were not the subject of normal filing requirements such as a prospectus. As normal safeguards are not in place, these securities can only be sold to a narrow and defined class of investors. Determining whether an individual qualifies to invest or whether the investment is suitable for the individual is an important obligation of an EMD.

[18] Two of the exempt market securities sold through IHOC were Golden Gate Funds LP (“Golden Gate”) and Alterra Preferred Equity Real Estate Limited Partnership and Alterra Preferred Equity Fund Real Estate Limited Partnership (“Alterra”). The principal of Golden Gate admitted to having perpetrated a fraud through Golden Gate and Alterra was found to have misappropriated funds. Almost all of the Alterra securites were sold through IHOC.

[19] On November 30, 2009, after conducting three compliance reviews, the MFDA issued a Notice commencing proceedings against IHOC and the Appellants. On April 8, 2010, MFDA staff entered into the Settlement Agreement with the Appellants and IHOC. As part of the Settlement Agreement, the Appellants admitted to a number of violations of the MFDA By-laws, Rules and Policies, including selling exempt products to clients without ensuring that they were suitable for those clients, selling exempt products to clients without ensuring that the clients qualified as accredited investors, allowing the sale of exempt products to clients without having conducted reasonable due diligence on the nature of the products to determine if they were suitable for sale to the clients, and conducting negotiations with Alterra and Golden Gate to sell a significant portion of IHOC to them while they were selling their products to clients who did not know of the proposed acquisitions. None of the allegations against the Appellants suggested that they were guilty of fraud, misappropriation or “high pressure sale tactics.”

[20] As part of the Settlement Agreement, IHOC was suspended from the MFDA and wound down. The Appellants were each fined $10,000.00 and prohibited from acting in the capacity of a branch manager, compliance officer or ultimate designated person for a period of three years. On June 29, 2010, a Hearing Panel of the MFDA issued reasons accepting the Settlement Agreement, finding that the “centrepiece of the agreement” was the immediate suspension of IHOC from the MFDA, which would “enhance investor protection and strengthen public confidence in the MFDA.” With respect to the Appellants the panel found, among other things, that “if they work in the securities industry it will only be as employees and subject to the review and control of others.” The panel articulated that they were aware of the principle that they should not lightly interfere with a negotiated settlement.

The Proceedings Before the Commission

[21] On May 18, 2010, Commission Staff received applications from the Appellants to have their registrations as dealing representatives reinstated in the categories of MFD and EMD. They did so on the basis that their applications were sponsored by a member of the MFDA, MGI Financial (“MGI”). After IHOC was wound down, a significant portion of its client files and accounts were transferred to MGI.

[22] Commission Staff refused the Appellants’ applications for reinstatement. The matter proceeded to an Opportunity to be Heard hearing, where the Appellants only sought reinstatement in the MFD category. On January 25, 2011, the Deputy Director of the Commission denied their applications.

[23] The Appellants requested a hearing and a review of the Deputy Director’s decision. The Commission held a hearing de novo and determined that Commission Staff bore the onus of establishing that the Appellants were not suitable to have their registrations reinstated or that the proposed registrations were “otherwise objectionable.”

[24] During the course of the six-day hearing before the Commission, the Appellants both testified. They also called five witnesses, four of whom were former clients of IHOC. Commission staff called three former IHOC clients. On August 1, 2012, the Commission issued a 68-page decision in which it detailed the evidence it had heard and gave its reasons for refusing to grant the Appellants’ applications for reinstatement of their registrations.

The Commission’s Decision

[25] The Commission’s decision focuses on three main questions: (1) whether the Appellants were unsuitable for registration based on lack of proficiency; (2) whether the Appellants were unsuitable on the basis of lack of integrity; and (3) whether the reinstatement of the Appellants would be otherwise objectionable.

Proficiency

[26] The Commission found that while at IHOC, the Appellants failed to meet their obligations to ensure that their investors met the criteria to be an accredited investor for exempt products. It was troubled by the failure to question the information received from clients about their financial status, even where there were clear indications of the need to do so.

[27] The Commission also found that during the hearing both Appellants continued to demonstrate a lack of understanding of the impropriety of their past behaviour, which caused it to conclude that at the time of the hearing the Appellants did not fully understand their obligations. The Commission acknowledged that it heard evidence from witnesses who were sold products by the Appellants and met the requirements to be accredited, and also that the Appellants had declined to sell a product to an investor when it was inappropriate to do so. However, the Commission’s concern was about the Appellants’ ability to consistently discharge their obligations in the future.

[28] Directly connected to the concern about ensuring that the investors they dealt with met the criteria for investing in exempt products was a finding by the Commission that the Appellants failed to discharge their obligation to obtain know-your-client (“KYC”) information about their clients’ financial circumstances. It also found that at the hearing the Appellants continued to demonstrate a lack of understanding of the importance of this obligation, an obligation that is an essential part of the proficiency requirement for a dealer representative who only sells mutual funds.

[29] The Commission found that the Appellants did not exercise due diligence to know the products that they were selling and to explain the risks of those products to their clients. It also found that at the hearing the Appellants failed to demonstrate that they understood these shortcomings, which just raised further questions about their proficiency for registration. In this regard the Commission stated the following: “In light of the fact that the know-your-product requirement is now more significant to current regulatory obligations, we do not believe that the [Appellants] will be able to discharge these responsibilities appropriately if their registrations are reinstated” (para. 251).

[30] The Appellants argued before the Commission that their failures to meet the proficiency criteria in the past were isolated incidents. However, the Commission rejected this characterization at para. 254:

In light of the direct evidence from the [Appellants] themselves about their approach to suitability, the MFDA Compliance Examinations and the [Appellants’] demonstrated failure to understand the need to conduct due diligence on complex products, we take the view that these failures reflect an absence of appropriate judgment expected in the circumstances rather than isolated failures.

Integrity

[31] With respect to the integrity criterion, the Commission heard evidence about the Appellants’ failure to disclose to clients the fact that they were in discussions with Alterra and Golden Gate about selling them a significant equity interest in IHOC. These discussions were ongoing while the Appellants were selling clients Alterra and Golden Gate products. The Commission found that these circumstances raised a conflict of interest concern that the Appellants failed to “disclose or otherwise manage.” This behaviour did not meet the “high standards of fitness and business conduct to ensure honest and responsible conduct by market participants” encompassed by the integrity criterion (para. 284).

[32] The Commission also found that at the hearing the Appellants continued to deny that there was a need to disclose or otherwise manage this conflict or potential conflict of interest and concluded that this denial prevented it from finding that the Appellants “will address conflicts of interest in accordance with the integrity requirements of registration in the future” (para. 284).

[33] With respect to the Appellant Sawh, the Commission made a specific finding that his testimony before it on one aspect of this issue was not credible because of what it found to be a prior inconsistent statement. This added to its “discomfort about his integrity to be registered” (para. 284).

Otherwise Objectionable

[34] In dealing with the question of whether the Appellants’ reinstatement was otherwise objectionable, the Commission focused on two areas of the evidence: the Appellants’ conduct since the MFDA Settlement and the Appellants’ responses to questions about the MFDA Settlement.

[35] With respect to the first area, the Commission found that since the MFDA Settlement, the Appellants held themselves out on a website for another organization that they owned in a way that was misleading as to what type of investments they were registered to sell. While steps were taken to correct these statements, the fact remained that the statements were on the website from at least March 14, 2011 until April 5, 2011. This, according to the Commission, showed a lack of care on the part of the Appellants that added to its “discomfort about their ability to conduct themselves in accordance with the requirements of regulated activity” (para. 296).

[36] The Commission “also ha[d] concerns about the [Appellants’] forthrightness in their disclosure to their former clients, with whom they maintained a professional relationship following the MFDA Settlement, about what activities they were licensed to carry out” (para. 297).

[37] The Commission determined that when questioned about their admissions in the MFDA Settlement, the Appellants “admitted to failures of an administrative nature only rather than acknowledging their failures of judgment” (para. 301), and that without a demonstrated understanding of their “previous shortcomings” the Commission could have no assurance that the Appellants would “behave differently in the future” (para. 309). The Commission further observed that “[t]he focus of testimony at the Hearing and Review was to minimize transgressions and to refuse to take responsibility for the admissions in the MFDA Settlement Agreement” (para. 310).

Conclusion

[38] For the above reasons, the Commission determined that the Appellants lacked the requisite proficiency and integrity to be registered as dealing representatives of a mutual fund dealer. It also found that their reinstatements would be otherwise objectionable.

[39] In doing so the Commission acknowledged that prior to their involvement with IHOC the Appellants had no regulatory history and that they were no longer seeking to sell the kind of products to which their difficulties at IHOC related. However, even if the Appellants are only selling mutual funds, they are still required to do such things as keep accurate and current KYC information on clients, not recommend investments that are unsuitable to the risk tolerance of clients and disclose conflicts of interests.

[40] The Commission considered the fact that the Appellants were asking for reinstatement on the basis that “MGI would be closely monitoring and supervising them.” However, it found that the Appellants provided no details as to how their arrangement with MGI would address the Commission’s suitability and objectionability concerns (para. 314).

Analysis

[41] The Appellants’ main submission on this appeal is that the Commission unreasonably conducted a “hearing and review” of the MFDA’s decision and came to a different result without properly explaining why. According to the Appellants, not only does the Commission’s decision create an unfairness to the Appellants by violating their reasonable expectations, it also undermines the integrity of the regulatory regime in place in the securities industry in Ontario.

[42] In making this submission the Appellants point to the fact that the conduct that the Commission reviewed was almost exclusively conduct that had already been fully investigated by the MFDA. Yet, the MFDA did not impose a sanction barring the Appellants from reapplying for reinstatement of their registrations. By refusing to reinstate the Appellants’ registrations “the Commission departed from its own established practice and application of legal principles concerning deference owed to determinations made by expert SROs such as the MFDA” (Appellants’ Factum, para. 37).

[43] According to the Appellants the Commission has in the past shown deference to the determinations of the SROs, recognizing that SROs play an essential role in regulating the securities industry in Ontario. The Appellants cited a number of cases where the Commission was conducting reviews of SRO decisions under s. 21.7(1) of the Securities Act and the Commission reiterated that it would not substitute its own views on the issue simply because it might disagree with the SRO or make a different decision on the facts. In doing so the Commission has acknowledged that an overly interventionist approach may result in an unacceptable degree of uncertainty in the regulatory regime.

[44] In this case, according to the Appellants, the MFDA conducted three compliance reviews of IHOC over a number of years. It fully investigated the matters at issue and yet did not insist that the Appellants be barred from registration before settling the matter. In fact, the Settlement Agreement explicitly contemplated that the Appellants would be reinstated and prohibited them from acting in certain capacities for three years. The Settlement Agreement was confirmed by a Hearing Panel of the MFDA who issued reasons for its decision. Yet the Commission, without explanation, went behind the MFDA decision and settlement, held its own hearing and came to a different conclusion on penalty. This was said to be unreasonable.

[45] I agree with the Appellants that the jurisprudence surrounding s. 21.7(1) reviews by the Commission of SRO decisions highlights the importance of deference to the findings of SROs, particularly when those findings concern matters within the SRO’s expertise. However, it is important to recognize that in this case the Commission was not conducting a hearing and review of the MFDA Settlement or the Hearing Panel Decision approving that settlement.

[46] Section 21.7(1) provides that

… a person or company directly affected by, or by the administration of, a direction, decision, order or ruling made under a by-law, rule, regulation, policy, procedure, interpretation or practice of a … recognized self-regulatory organization … may apply to the Commission for a hearing and review of the direction, decision, order or ruling.

[47] In the case at bar, the Commission was exercising its jurisdiction under s. 27(1) of the Securities Act to consider whether the Appellants met the criteria for reinstatement of registration set out in ss. 27(1) and (2). The regulatory scheme in place gives the Commission sole jurisdiction over this area. While the Commission could have delegated this jurisdiction to the MFDA, it did not do so. In exercising its jurisdiction with respect to the Appellants’ applications the Commission explained the distinction between the issues the MFDA considered and its own role on the hearing before it as follows, at para. 311:

Pursuant to section 27 of the Act, it is the responsibility of the Commission to register individual dealing representatives in Ontario. The framework of the registration regime requires a determination by the Commission as to the [Appellants’] suitability to be registered and whether the reinstatement of the [Appellants’] registrations is otherwise objectionable, which is separate from any agreements entered into with the MFDA. [Emphasis added.]

[48] The other fundamental distinction between this case and the cases that were cited to us by the Appellants on the issue of the need for the Commission to show deference to the findings and decisions of the MFDA is that in this case, the MFDA Hearing Panel that approved the MFDA Settlement Agreement made no findings on the issues that the Commission considered. The Hearing Panel did not hear evidence about and make findings as to whether the Appellants were suitable for registration or whether the reinstatement of their registrations would be otherwise objectionable. What it did was consider whether to approve a settlement entered into by the MFDA Staff with the Appellants, a settlement that did not state that the Appellants’ registrations as dealer representatives would be reinstated.

[49] In approving the Settlement Agreement, the MFDA Hearing Panel focused on the fact that it should not “lightly interfere” with settlement agreements and on the fact that when it came to protecting the public,

[t]he centerpiece of the Settlement Agreement is the immediate suspension of the membership of The Investment House in the MFDA until such time as its resignation is accepted. This may be the first time in Canadian securities history that a going concern is wound down as a result of breaches of securities legislation.

The MFDA Penalty Guidelines suggest “suspension or termination in egregious cases”. Thus, the suspension of The Investment House as an MFDA Member is the most severe penalty we can impose. The Investment House will not harm the public anymore. [MFDA Hearing Panel, Reasons for Decision, paras. 20 and 27.]

[50] With respect to whether the Appellants would be able to work in the securities industry in the future, the MFDA Hearing Panel made no findings on this issue. Its only comment was the following:

The fines imposed on Sawh and Trkulja are the minimus [sic] suggested in cases of this kind. However, and as noted above, their reputations have suffered by the public condemnation of their actions. Moreover, for the next three years, if they work in the securities industry it will only be as employees and subject to the review and control of others. [MFDA Hearing Panel, Reasons for Decision, para. 28; emphasis added.]

[51] Therefore, the Appellants’ submission that the Commission unreasonably failed to show deference to the MFDA Settlement and Decision approving that settlement ignores the reality that there was nothing to which to show deference. The furthest the MFDA went was to put a three-year restriction on the Appellants’ ability to function in the securities industry if they were in that industry.

[52] The Appellants may have had the expectation that once the MFDA Settlement was approved, there would be no problem with the reinstatement of their registrations. However, the fact that this was their expectation does not make the expectation a reasonable one. First, the MFDA has no jurisdiction over the issue and second, the MFDA made no finding on the issue except to impose conditions if their registrations were reinstated.

[53] The Appellants argue that the Commission’s refusal to reinstate their registrations is punishing them again for conduct for which the MFDA has already penalized them. However, the proceedings before the Commission were not enforcement proceedings and the Commission was not considering whether further sanctions should be imposed on the Appellants for their conduct. Rather, the Commission’s mandate was to decide whether the Appellants met the criteria for registration as dealer representatives of a mutual fund dealer. As put by the Commission in Re Michalik (2007), 30 O.S.C.B. 6717, at para. 51:

Registration is a privilege that is granted to individuals and entities that have demonstrated suitability. No person has the right to be registered. [Emphasis in original; citation omitted.]

[54] In exercising its mandate under s. 27 of the Securities Act, the Commission must be guided by the purposes of the Securities Act, which include protecting the public and fostering confidence in the capital markets. The Commission’s reasons, read as a whole, make it clear that the decision it reached was driven by a consciousness of its role in fulfilling the Act’s purposes, not by a desire to punish the Appellants.

[55] In reaching the decision it did, the Commission reviewed the Appellants’ past conduct, but with a view to deciding whether the Appellants appreciated what they had done, had learned from their mistakes and could be trusted not to engage in the same conduct again. Dealer representatives who do not understand their fundamental obligations pose a risk to the public and undermine confidence in the market.

[56] The Commission was aware that the Appellants were no longer seeking to deal in exempt products, but found that the breaches committed by the Appellants (and which they failed to fully appreciate) were breaches of obligations that were also central to the responsible discharge of the role of dealer representative of a mutual fund dealer (for example, the obligations to know your client, know your product and manage conflicts of interests).

[57] The Appellants relied on a decision made by the Deputy Director of the Commission after the decision under appeal. According to the Appellants, in Re Lawson (2012), 35 O.S.C.B. 8109, the Deputy Director reinstated the registration of an applicant with a more egregious history than theirs. The conflict between the two decisions is said to demonstrate the unreasonableness of the decision under appeal.

[58] With respect to this submission, there can be no suggestion that the Commission unreasonably failed to follow its own precedents because Re Lawson was decided after the decision in question. Second, both the Securities Act and Commission jurisprudence make it clear that the Commission is not bound by a decision of the Director (s. 8(3) of the Securities Act, Re Triax Growth Fund Inc. (2005), 2005 ONSEC 16, 28 O.S.C.B. 10139, at para. 25). Third, there were differences between the Lawson case and the Appellants’. Fourth, in Lawson, a settlement was negotiated with the involvement of both MFDA and Commission Staff. Presumably, unlike with the Appellants, Commission Staff were satisfied that Mr. Lawson had learned from his mistakes and did not pose a risk of repeating those mistakes in the future.

Conclusion

[59] For these reasons I find that the Commission’s decision was reasonable. The reasoning is justifiable, transparent and intelligible and the conclusion reached “falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law”: Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at para. 47. The appeal is, therefore, dismissed. Since the Commission advised us that it was not seeking costs, there will be no order as to costs.

H. Sachs J.

A. Molloy J.

K. Swinton J.

Released: June 12, 2013

CITATION: Sawh v. Ontario Securities Commission, 2013 ONSC 4018

DIVISIONAL COURT FILE NO.: 416/12

DATE: 20130612

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Molloy, Swinton and Sachs JJ.

BETWEEN:

SANJI SAWH and VLAD TRKULJA

Appellants

– and –

ONTARIO SECURITIES COMMISSION

Respondent

REASONS FOR DECISION

Molloy J.

Swinton J.

Sachs J.

Released: June 12, 2013