Draft:Kerr v Danier Leather Inc: Difference between revisions

Kerr v Danier Leather Inc [2007] 3 S.C.R. 331 , 2007 SCC 44^[1] is a 2007 Supreme Court of Canada decision which speaks to the Business Judgement rule.

Danier made an initial public offering of its shares through a prospectus.  The prospectus contained a forecast that included Danier’s projected results for the fourth quarter of the fiscal year.  An internal company analysis prepared before its public offering closed showed that Danier’s fourth quarter results were lagging behind its forecast.  Danier did not disclose its intra‑quarterly results before closing. 

The appellants therefore brought a class proceeding for prospectus misrepresentation under s. 130(1) of the Ontario Securities Act.  The trial judge found Danier liable for statutory misrepresentation.  He concluded that the prospectus impliedly represented that the forecast was objectively reasonable, both on the date the prospectus was filed and on the date the public offering closed.  The poor fourth quarter results were material facts required by s. 130(1) to be disclosed before closing. 

The implied representation that the forecast was objectively reasonable, though true on the date the prospectus was filed, was false on the closing date. 

The Court of Appeal, however, reversed the trial judgment.

Held:  The appeal should be dismissed.^[1]

Category:Supreme Court of Canada cases
Category:2007 in Canadian case law