Potter v. Nova Scotia Securities Commission, 2006 NSCA 45

• Judge: Bateman, Cromwell and Saunders, JJ.A.
• Court: Court of Appeal of Nova Scotia (Canada)
• Case Date: March 24, 2006
• Jurisdiction: Nova Scotia
• Citations: 2006 NSCA 45;(2006), 246 N.S.R.(2d) 1 (CA)

Potter v. N.S. Securities Comm. (2006), 246 N.S.R.(2d) 1 (CA);

    780 A.P.R. 1

MLB headnote and full text

Temp. Cite: [2006] N.S.R.(2d) TBEd. AP.053

The Nova Scotia Securities Commission (appellant) v. Daniel Potter (respondent)

(CA 256947; 2006 NSCA 45)

Indexed As: Potter v. Nova Scotia Securities Commission

Nova Scotia Court of Appeal

Bateman, Cromwell and Saunders, JJ.A.

April 19, 2006.

Summary:

The Nova Scotia Securities Commission ordered an investigation into the trading in securities of Knowledge House Inc. (KHI). Potter was the president, CEO and chair of the board of KHI. Potter applied for judicial review to quash that investigation. A number of procedural issues arose, including a request by Potter that the Commission file a complete return and a request by the Commission to set aside a notice of examination issued by Potter to one of its investigators.

The Nova Scotia Supreme Court, per Richard, J., in a decision not reported in this series of reports, ordered the Commission to file a return which would include virtually all of the fruits of the investigation in relation to Potter and upheld (with some variation) the notice of examination which Potter had issued to the investigator. The Commission applied for leave to appeal, arguing that the underlying judicial review application was improper and premature and that, as a result, the procedural orders under appeal should not have been made (i.e., the Commission claimed that Potter, ought, in the first instance, to take his complaints about the investigation to it, not to the courts).

The Nova Scotia Court of Appeal agreed with the Commission and, therefore, granted leave to appeal, allowed the appeal and stayed the underlying judicial review application.

Securities Regulation - Topic 1365

Regulatory commissions - Practice - Discovery or examination (incl. request that Commission file complete return) - The Nova Scotia Securities Commission ordered an investigation into the trading in securities of Knowledge House Inc. (KHI) of which Potter was president, CEO and chair of the board - Potter applied for judicial review to quash that investigation - Procedural issues arose, including a request by Potter that the Commission file a complete return - A chambers judge ordered the Commission to file a return - The Commission appealed, arguing that the underlying judicial review application was improper and premature and that, as a result, the procedural orders under appeal should not have been made - The Nova Scotia Court of Appeal allowed the appeal and stayed the underlying judicial review application - The court held that while certiorari was potentially available to review the investigation, this was not a case where the court would exercise its discretion to intervene in the investigation - Rather, this was a case where Potter's complaints about the investigation should in the first instance go to the Commission - See paragraphs 13 to 51.

Securities Regulation - Topic 1381.1

Regulatory commissions - Statutory appeal to courts or judicial review - Time for - [See Securities Regulation - Topic 1365 ].

Cases Noticed:

Psychologist Y v. Board of Examiners in Psychology (N.S.) (2005), 236 N.S.R.(2d) 273; 749 A.P.R. 273 (C.A.), refd to. [para. 16].

Waverley (Village Commissioners) et al. v. Kerr et al. (1994), 129 N.S.R.(2d) 298; 362 A.P.R. 298 (C.A.), refd to. [para. 19].

IMS Health Canada Ltd. v. Information and Privacy Commissioner (2005), 376 A.R. 336; 360 W.A.C. 336 (C.A.), refd to. [para. 23].

Nova Scotia Securities Commission v. W. (1996), 152 N.S.R.(2d) 1; 442 A.P.R. 1 (S.C.), refd to. [para. 33].

Pezim v. British Columbia Securities Commission et al., [1994] 2 S.C.R. 557; 168 N.R. 321; 46 B.C.A.C. 1; 75 W.A.C. 1, refd to. [para. 39].

Pezim v. British Columbia (Superintendent of Brokers) - see Pezim v. British Columbia Securities Commission et al.

British Columbia Securities Commission v. Branch and Levitt, [1995] 2 S.C.R. 3; 180 N.R. 241; 60 B.C.A.C. 1; 99 W.A.C. 1, refd to. [para. 39].

Deloitte & Touche LLP v. Ontario Securities Commission (2002), 159 O.A.C. 257 (C.A.), affd. [2003] 2 S.C.R. 713; 310 N.R. 376; 179 O.A.C. 1, refd to. [para. 41].

Asbestos Corp., Société nationale de l'Amiante and Quebec (Province), Re, [2001] 2 S.C.R. 132; 269 N.R. 311; 146 O.A.C. 201, refd to. [para. 41].

Committee for Equal Treatment of Asbestos Minority Shareholders v. Ontario Securities Commission - see Asbestos Corp., Société nationale de l'Amiante and Quebec (Province), Re.

Cartaway Resources Corp. et al., Re, [2004] 1 S.C.R. 672; 319 N.R. 1; 195 B.C.A.C. 161; 319 W.A.C. 161, refd to. [para. 41].

Schriver v. Securities Act (2006), 239 N.S.R.(2d) 306; 760 A.P.R. 306 (C.A.), refd to. [para. 41].

Nova Scotia Securities Commission v. Schriver - see Schriver v. Securities Act.

Deloitte & Touche LLP v. Ontario Securities Commission (2005), 198 O.A.C. 333 (Div. Ct.), refd to. [para. 44].

Smolensky v. British Columbia Securities Commission (2004), 193 B.C.A.C. 240; 316 W.A.C. 240; 236 D.L.R.(4th) 262 (C.A.), leave to appeal dismissed (2004), 333 N.R. 396; 214 B.C.A.C. 320; 353 W.A.C. 320 (S.C.C.), refd to. [para. 44].

Glover v. Minister of National Revenue (1980), 43 N.R. 273; 113 D.L.R.(3d) 161 (Ont. C.A.), affd. [1981] 2 S.C.R. 561; 43 N.R. 271, refd to. [para. 45].

Glover v. Glover et al. (No. 1) - see Glover v. Minister of National Revenue.

R. v. Snider, [1954] S.C.R. 479, refd to. [para. 45].

Cook v. Washuta (1985), 11 O.A.C. 171; 52 O.R.(2d) 289 (C.A.), refd to. [para. 45].

Cook v. Ip - see Cook v. Washuta.

Swinimer v. Canada (2005), 231 N.S.R.(2d) 129; 733 A.P.R. 129 (S.C.), refd to. [para. 46].

National Bank Financial Ltd. v. Potter et al. (2005), 233 N.S.R.(2d) 123; 739 A.P.R. 123 (S.C.), refd to. [para. 53].

Statutes Noticed:

Securities Act, R.S.N.S. 1989, c. 418, sect. 29A [para. 42].

Authors and Works Noticed:

Brown, Donald J.M., and Evans, John M., Judicial Review of Administrative Action in Canada (2005 Looseleaf Update), paras. 1:2231 [para. 14]; 3:4100 [para. 16].

Mullan, David J., Administrative Law (3rd Ed. 1996), para. 539 [para. 36].

Counsel:

Agnes MacNeil, for the appellant;

Respondent appearing on his own behalf;

Edward Gores, Q.C., for the Attorney General of Nova Scotia.

This application for leave to appeal and appeal were heard in Halifax, Nova Scotia, on March 24, 2006, before Bateman, Cromwell and Saunders, JJ.A., of the Nova Scotia Court of Appeal. Cromwell, J.A., delivered the following reasons for judgment on April 19, 2006.