British Columbia’s appeal court has rejected a proposed constitutional challenge to a provision of the British Columbia Securities Commission’s (BCSC) investigative powers, along with a bid to require extensive disclosure from the regulator to witnesses.
The legal challenge stemmed from an investigation order issued by the BCSC in 2018, which required Ranvir Brar and Harjit Gahunia to attend an interview with the regulator. They were considered witnesses rather than targets of the investigation.
Yet, after they failed to attend their scheduled interviews in 2021, the BCSC began contempt proceedings against them. In response, they argued that the provision of securities law used to compel them to provide evidence was unconstitutional.
They also sought extensive disclosure from the regulator detailing all of the information that the BCSC had compiled in the investigation.
In June 2023, the constitutional challenge and the disclosure application were dismissed in a decision by the Supreme Court of British Columbia.
On Tuesday, the Court of Appeal for British Columbia upheld that ruling.
In its decision, the appeal court said Brar and Gahunia argued that the provision empowering the BCSC to compel evidence from witnesses violated the Charter of Rights and Freedoms “because the court would merely be ‘rubber stamping’ an investigator’s decision to seek contempt and the provision thereby ‘trampled on judicial independence.'”
However, the appeal court sided with the Supreme Court judge, who found that very similar provisions of the Securities Act have already “withstood constitutional scrutiny,” adding “the chambers judge was correct when she decided that she was bound by the Supreme Court of Canada precedent.”
The court also upheld the chambers judge’s decision to reject arguments that the provision was unconstitutionally vague and overly broad because it allows the BCSC to apply for a contempt order without first issuing a compliance order.
The lower court concluded that the provision was not too vague, or too broad, and the appeal court agreed with that ruling.
The appeal court also found that there was no error in the decision dismissing the disclosure application.
“The appellants’ argument on this issue is misconceived and devoid of merit. The chambers judge was right to decline to make the broad disclosure order the appellants sought,” the court said in its decision.
“The chambers judge considered the status of the appellants as witnesses, the state of the investigation (ongoing), that the appellants were not the targets of the investigation, and the obligation of the investigator to maintain confidentiality of an ongoing investigation. Significantly, she considered relevance — the appellants had all of the material relevant to them. There is nothing to the submission that the chambers judge erred in her refusal to grant the vast disclosure order sought,” it concluded.