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OFFENCES AND ENFORCEMENT - Procedure - Powers of the court

Tuesday, July 21, 2020 @ 5:54 AM  


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Appeal by the Financial and Consumer Services Commission from a decision by the Financial and Consumer Services Tribunal. For the previous 11 years, the Commission pursued an investigation and formal allegations against Emond and Drapeau with respect to wrongdoing related to promotion and sale of investments and securities. The delay resulted from Drapeau’s conduct and complacency on the part of the Tribunal in acquiescing to adjournments. In 2016, the Tribunal ruled on its motion, finding that the delay in adjudicating the merits caused it to lose jurisdiction. In 2017, the Court of Appeal set the ruling aside and remitted the matter to the Tribunal for determination on the merits. No such determination occurred, and another lengthy adjournment resulted due to a conflict of interest involving a Tribunal member. When the matter resumed, the Tribunal brought its own motion asking the parties to address the effect of s. 190 of the Securities Act. The Tribunal found that, pursuant to s. 190, it lost jurisdiction after two years lapsed following the filing of the formal allegations without there having been a determination on the merits. The Commission appealed.

HELD: Appeal allowed. The subsequent repeal of s. 190 obviated the need for detailed analysis of the Tribunal’s errors. The purpose of s. 190 was to preserve jurisdiction over a registrant whose registration had been expired or cancelled. It followed that any limitation period under s. 190 would apply to the activities of someone qua registrant and not to prohibit orders or exercise of powers under other provisions against anyone for having otherwise violated the Act. The normal remedy was to remit the matter to the Tribunal for determination on the merits. However, both the ongoing delay after 2017 and the inordinate overall delay made it inappropriate to do anything but stay further proceedings before the Tribunal. The various forms of prejudice the Tribunal identified in 2016 not only remained but were exacerbated by the year-long delay in constituting a panel to hear the matter in the French language, offending the community’s sense of fairness in a province where linguistic rights were statutorily and constitutionally guaranteed.

New Brunswick (Financial and Consumer Services Commission) v. Emond, [2020] N.B.J. No. 132, New Brunswick Court of Appeal, J.C.M. Richard C.J.N.B., K.A. Quigg and B.L. Baird JJ.A., June 18, 2020. Digest No. TLD-July202020003