Administrative law – Decisions of administrative tribunals – Securities Commission – Director of corporation – Removal – Hearings – Conduct of hearings – Judicial review – Evidence – Procedural requirements and fairness
McLeod v. Alberta Securities Commission,  A.J. No. 939, Alberta Court of Appeal, July 31, 2006, Fraser C.J.A. and Hunt and O’Brien JJ.A
McLeod was the President and a Director and an employee of Flag and Golden Briar, companies listed on the TSX Venture Exchange (the “Exchange”). Miszczuk was a Director of Flag and the Chairman of its Board and a member of its auditing committee. Unsatisfied with McLeod’s response to earlier concerns expressed by the Exchange with the acceptability of McLeod and Miszczuk as Directors and Officers of the companies, the Exchange halted trading in shares of Flag and Golden Briar in 2004. The Exchange informed McLeod and Miszczuk of its decision and informed them that they were entitled to participate in a subsequent review of their acceptability by the Exchange. No oral hearing was held. The Exchange considered a response from McLeod, but received no response from Miszczuk. Both McLeod and Miszczuk were found unsuitable and were informed of the Exchange’s decision by letter. The decisions were stayed pending appeals to the Alberta Securities Commission (the “Commission”).
McLeod and Miszczuk sought to present evidence from themselves and three other witnesses at the appeal. However, the appeal proceeded on the record, without additional evidence from McLeod and Miszczuk save oral testimony to enable the Commission to determine if McLeod and Miszczuk were denied procedural fairness. McLeod and Miszczuk presented lengthy evidence and were examined extensively. The Commission upheld the decisions of the Exchange disqualifying McLeod and Miszczuk from being Directors and Officers of companies listed on the Exchange. McLeod and Miszczuk appealed this decision to the Court.
The Alberta Court of Appeal dismissed the appeal finding that McLeod and Miszczuk had not been denied the opportunity to put forward material testimony. They were fully informed of the case they needed to meet and given a full opportunity to respond. The Court held that the Commission acted reasonably in confirming the sanctions imposed by the Exchange and in concluding that McLeod conducted himself contrary to the Exchange rules and that Miszczuk tolerated such conduct.
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