Acts and Regulations

S-5.5 - Securities Act

Section 151
Disposition versions

Full text
Liability for misrepresentation in advertising or sales literature
2012, c.31, s.10
151(1)Where advertising or sales literature that is disseminated in connection with a trade of securities contains a misrepresentation, a purchaser who purchases securities referred to in that advertising or sales literature shall be deemed to have relied on that misrepresentation if it was a misrepresentation at the time of purchase and has a right of action for damages against
(a) the issuer or a selling security holder on whose behalf the trade is made,
(b) where a prospectus is used in connection with the trade, every underwriter that is in a contractual relationship with the issuer or selling security holder on whose behalf the distribution is made,
(c) every promoter or director of the issuer or selling security holder, as the case may be, at the time the advertising or sales literature was disseminated, and
(d) every person who at the time the advertising or sales literature was disseminated, sells securities on behalf of the issuer or selling security holder with respect to which the advertising or sales literature was disseminated.
151(2)Subsection (1) applies to trades of securities pursuant to
(a) a prospectus,
(b) an exemption from section 71 that is provided for under the regulations or in an order made by the Commission under section 80, or
(c) a decision of the Commission or the Tribunal.
151(3)Where a purchaser referred to in subsection (1) purchased the securities from a person referred to in paragraph (1)(a) or (b) or from another underwriter of the securities, the purchaser may elect to exercise a right of rescission against that person or underwriter, in which case the purchaser shall have no right of action for damages against the person or underwriter.
151(4)No person is liable under subsection (1) or (3) if the person proves that the purchaser purchased the securities with knowledge of the misrepresentation.
151(5)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) if the person proves
(a) that the advertising or sales literature was disseminated without the person’s knowledge or consent and that, on becoming aware of its dissemination, the person gave reasonable general notice that it was so disseminated,
(b) that, after the dissemination of the advertising or sales literature and before the purchase of the securities by the purchaser, on becoming aware of any misrepresentation in the advertising or sales literature the person withdrew the person’s consent to it and gave reasonable general notice of the withdrawal and the reason for the withdrawal, or
(c) that, with respect to a false statement purporting to be a statement made by an official person or contained in what purports to be a copy of, or an extract from, a public official document, it was a correct and fair representation of the statement or copy of, or extract from, the document, and the person had reasonable grounds to believe and did believe that the statement was true.
151(6)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature purporting to be made on the person’s own authority as an expert or purporting to be a copy of, or an extract from, the person’s own report, opinion or statement as an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(7)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature not purporting to be made on the authority of an expert and not purporting to be a copy of or, an extract from, a report, opinion or statement of an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(8)A person referred to in paragraph (1)(d) is not liable under subsection (1) or (3) if that person can establish that the person cannot reasonably be expected to have had knowledge that the advertising or sales literature was disseminated or contained a misrepresentation.
151(9)No underwriter is liable for more than the total public offering price represented by the portion of the distribution underwritten by the underwriter.
151(10)In an action for damages under subsection (1), the defendant is not liable for all or any portion of the damages that the defendant proves do not represent the depreciation in value of the securities as a result of the misrepresentation relied on.
151(11)All or any one or more of the persons referred to in subsection (1) or (3) are jointly and severally liable, and every person who becomes liable to make any payment under this section may recover a contribution from any person who, if sued separately, would have been liable to make the same payment unless the court rules that, in all the circumstances of the case, to permit recovery of the contribution would not be just and equitable.
151(12)In no case shall the amount recoverable under this section exceed the price at which the securities were offered to the public.
151(13)The right of action for rescission or damages conferred by this section is in addition to and without derogation from any other right the purchaser may have at law.
2007, c.38, s.161; 2012, c.31, s.11; 2013, c.31, s.36
Liability for misrepresentation in advertising or sales literature
2012, c.31, s.10
151(1)Where advertising or sales literature that is disseminated in connection with a trade of securities contains a misrepresentation, a purchaser who purchases securities referred to in that advertising or sales literature shall be deemed to have relied on that misrepresentation if it was a misrepresentation at the time of purchase and has a right of action for damages against
(a) the issuer or a selling security holder on whose behalf the trade is made,
(b) where a prospectus is used in connection with the trade, every underwriter that is in a contractual relationship with the issuer or selling security holder on whose behalf the distribution is made,
(c) every promoter or director of the issuer or selling security holder, as the case may be, at the time the advertising or sales literature was disseminated, and
(d) every person who at the time the advertising or sales literature was disseminated, sells securities on behalf of the issuer or selling security holder with respect to which the advertising or sales literature was disseminated.
151(2)Subsection (1) applies to trades of securities pursuant to
(a) a prospectus,
(b) an exemption from section 71 that is provided for under the regulations or in an order made by the Commission under section 80, or
(c) a decision of the Commission.
151(3)Where a purchaser referred to in subsection (1) purchased the securities from a person referred to in paragraph (1)(a) or (b) or from another underwriter of the securities, the purchaser may elect to exercise a right of rescission against that person or underwriter, in which case the purchaser shall have no right of action for damages against the person or underwriter.
151(4)No person is liable under subsection (1) or (3) if the person proves that the purchaser purchased the securities with knowledge of the misrepresentation.
151(5)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) if the person proves
(a) that the advertising or sales literature was disseminated without the person’s knowledge or consent and that, on becoming aware of its dissemination, the person gave reasonable general notice that it was so disseminated,
(b) that, after the dissemination of the advertising or sales literature and before the purchase of the securities by the purchaser, on becoming aware of any misrepresentation in the advertising or sales literature the person withdrew the person’s consent to it and gave reasonable general notice of the withdrawal and the reason for the withdrawal, or
(c) that, with respect to a false statement purporting to be a statement made by an official person or contained in what purports to be a copy of, or an extract from, a public official document, it was a correct and fair representation of the statement or copy of, or extract from, the document, and the person had reasonable grounds to believe and did believe that the statement was true.
151(6)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature purporting to be made on the person’s own authority as an expert or purporting to be a copy of, or an extract from, the person’s own report, opinion or statement as an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(7)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature not purporting to be made on the authority of an expert and not purporting to be a copy of or, an extract from, a report, opinion or statement of an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(8)A person referred to in paragraph (1)(d) is not liable under subsection (1) or (3) if that person can establish that the person cannot reasonably be expected to have had knowledge that the advertising or sales literature was disseminated or contained a misrepresentation.
151(9)No underwriter is liable for more than the total public offering price represented by the portion of the distribution underwritten by the underwriter.
151(10)In an action for damages under subsection (1), the defendant is not liable for all or any portion of the damages that the defendant proves do not represent the depreciation in value of the securities as a result of the misrepresentation relied on.
151(11)All or any one or more of the persons referred to in subsection (1) or (3) are jointly and severally liable, and every person who becomes liable to make any payment under this section may recover a contribution from any person who, if sued separately, would have been liable to make the same payment unless the court rules that, in all the circumstances of the case, to permit recovery of the contribution would not be just and equitable.
151(12)In no case shall the amount recoverable under this section exceed the price at which the securities were offered to the public.
151(13)The right of action for rescission or damages conferred by this section is in addition to and without derogation from any other right the purchaser may have at law.
2007, c.38, s.161; 2012, c.31, s.11
Liability for misrepresentation in advertising or sales literature
151(1)Where advertising or sales literature that is disseminated in connection with a trade of securities contains a misrepresentation, a purchaser who purchases securities referred to in that advertising or sales literature shall be deemed to have relied on that misrepresentation if it was a misrepresentation at the time of purchase and has a right of action for damages against
(a) the issuer or a selling security holder on whose behalf the trade is made,
(b) where a prospectus is used in connection with the trade, every underwriter that is in a contractual relationship with the issuer or selling security holder on whose behalf the distribution is made,
(c) every promoter or director of the issuer or selling security holder, as the case may be, at the time the advertising or sales literature was disseminated, and
(d) every person who at the time the advertising or sales literature was disseminated, sells securities on behalf of the issuer or selling security holder with respect to which the advertising or sales literature was disseminated.
151(2)Subsection (1) applies to trades of securities pursuant to
(a) a prospectus,
(b) an exemption from section 71 that is provided for under the regulations or in an order made by the Commission under section 80, or
(c) a decision of the Commission.
151(3)Where a purchaser referred to in subsection (1) purchased the securities from a person referred to in paragraph (1)(a) or (b) or from another underwriter of the securities, the purchaser may elect to exercise a right of rescission against that person or underwriter, in which case the purchaser shall have no right of action for damages against the person or underwriter.
151(4)No person is liable under subsection (1) or (3) if the person proves that the purchaser purchased the securities with knowledge of the misrepresentation.
151(5)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) if the person proves
(a) that the advertising or sales literature was disseminated without the person’s knowledge or consent and that, on becoming aware of its dissemination, the person gave reasonable general notice that it was so disseminated,
(b) that, after the dissemination of the advertising or sales literature and before the purchase of the securities by the purchaser, on becoming aware of any misrepresentation in the advertising or sales literature the person withdrew the person’s consent to it and gave reasonable general notice of the withdrawal and the reason for the withdrawal, or
(c) that, with respect to a false statement purporting to be a statement made by an official person or contained in what purports to be a copy of, or an extract from, a public official document, it was a correct and fair representation of the statement or copy of, or extract from, the document, and the person had reasonable grounds to believe and did believe that the statement was true.
151(6)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature purporting to be made on the person’s own authority as an expert or purporting to be a copy of, or an extract from, the person’s own report, opinion or statement as an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(7)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature not purporting to be made on the authority of an expert and not purporting to be a copy of or, an extract from, a report, opinion or statement of an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(8)A person referred to in paragraph (1)(d) is not liable under subsection (1) or (3) if that person can establish that the person cannot reasonably be expected to have had knowledge that the advertising or sales literature was disseminated or contained a misrepresentation.
151(9)No underwriter is liable for more than the total public offering price represented by the portion of the distribution underwritten by the underwriter.
151(10)In an action for damages under subsection (1), the defendant is not liable for all or any portion of the damages that the defendant proves do not represent the depreciation in value of the securities as a result of the misrepresentation relied on.
151(11)All or any one or more of the persons referred to in subsection (1) or (3) are jointly and severally liable, and every person who becomes liable to make any payment under this section may recover a contribution from any person who, if sued separately, would have been liable to make the same payment unless the court rules that, in all the circumstances of the case, to permit recovery of the contribution would not be just and equitable.
151(12)In no case shall the amount recoverable under this section exceed the price at which the securities were offered to the public.
151(13)The right of action for rescission or damages conferred by this section is in addition to and without derogation from any other right the purchaser may have at law.
2007, c.38, s.161
Liability for misrepresentation in advertising or sales literature
151(1)Where advertising or sales literature that is disseminated in connection with a trade of securities contains a misrepresentation, a purchaser who purchases securities referred to in that advertising or sales literature shall be deemed to have relied on that misrepresentation if it was a misrepresentation at the time of purchase and has a right of action for damages against
(a) the issuer or a selling security holder on whose behalf the trade is made,
(b) where a prospectus is used in connection with the trade, each underwriter of the securities who is required by the regulations to sign a certificate required to be contained in the prospectus,
(c) every promoter or director of the issuer or selling security holder, as the case may be, at the time the advertising or sales literature was disseminated, and
(d) every person who at the time the advertising or sales literature was disseminated, sells securities on behalf of the issuer or selling security holder with respect to which the advertising or sales literature was disseminated.
151(2)Subsection (1) applies to trades of securities pursuant to
(a) a prospectus,
(b) an exemption from section 71 that is provided for under the regulations or in an order made by the Commission under section 80, or
(c) a decision of the Commission.
151(3)Where a purchaser referred to in subsection (1) purchased the securities from a person referred to in paragraph (1)(a) or (b) or from another underwriter of the securities, the purchaser may elect to exercise a right of rescission against that person or underwriter, in which case the purchaser shall have no right of action for damages against the person or underwriter.
151(4)No person is liable under subsection (1) or (3) if the person proves that the purchaser purchased the securities with knowledge of the misrepresentation.
151(5)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) if the person proves
(a) that the advertising or sales literature was disseminated without the person’s knowledge or consent and that, on becoming aware of its dissemination, the person gave reasonable general notice that it was so disseminated,
(b) that, after the dissemination of the advertising or sales literature and before the purchase of the securities by the purchaser, on becoming aware of any misrepresentation in the advertising or sales literature the person withdrew the person’s consent to it and gave reasonable general notice of the withdrawal and the reason for the withdrawal, or
(c) that, with respect to a false statement purporting to be a statement made by an official person or contained in what purports to be a copy of, or an extract from, a public official document, it was a correct and fair representation of the statement or copy of, or extract from, the document, and the person had reasonable grounds to believe and did believe that the statement was true.
151(6)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature purporting to be made on the person’s own authority as an expert or purporting to be a copy of, or an extract from, the person’s own report, opinion or statement as an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(7)No person, other than the issuer or selling security holder, is liable under subsection (1) or (3) with respect to any part of the advertising or sales literature not purporting to be made on the authority of an expert and not purporting to be a copy of or, an extract from, a report, opinion or statement of an expert unless the person
(a) failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or
(b) believed there had been a misrepresentation.
151(8)A person referred to in paragraph (1)(d) is not liable under subsection (1) or (3) if that person can establish that the person cannot reasonably be expected to have had knowledge that the advertising or sales literature was disseminated or contained a misrepresentation.
151(9)No underwriter is liable for more than the total public offering price represented by the portion of the distribution underwritten by the underwriter.
151(10)In an action for damages under subsection (1), the defendant is not liable for all or any portion of the damages that the defendant proves do not represent the depreciation in value of the securities as a result of the misrepresentation relied on.
151(11)All or any one or more of the persons referred to in subsection (1) or (3) are jointly and severally liable, and every person who becomes liable to make any payment under this section may recover a contribution from any person who, if sued separately, would have been liable to make the same payment unless the court rules that, in all the circumstances of the case, to permit recovery of the contribution would not be just and equitable.
151(12)In no case shall the amount recoverable under this section exceed the price at which the securities were offered to the public.
151(13)The right of action for rescission or damages conferred by this section is in addition to and without derogation from any other right the purchaser may have at law.