Decision in brief: Bridging Finance Inc, Enforcement Proceeding, Motions to stay the proceeding, June 21, 2023
In this enforcement proceeding, OSC staff alleges that David and Natasha Sharpe and the other respondents committed fraud. The Sharpes want the Tribunal to stay (permanently end) this proceeding because of what they say was an abuse of process. They say that the abuse of process arises from OSC staff providing confidential documents in the OSC’s court application to appoint a receiver over Bridging’s assets. The Sharpes say that the OSC first had to get permission from the Tribunal. See the March 30, 2022 reasons for the Tribunal’s earlier decision agreeing with the Sharpes on that point.
The Tribunal decided not to stay the proceeding. A stay is a drastic remedy, and the Sharpes have not shown that continuing the hearing will harm their right to a fair hearing or the integrity of the justice system. The possibility that witnesses may see the confidential documents before testifying will not harm the Sharpes’ right to a fair hearing. At the hearing, the Sharpes will be able to ask witnesses if they saw the confidential documents and whether having done so affected their testimony in any way. Continuing the hearing will not harm the integrity of the justice system. What the Sharpes are concerned about happened in the court application and not in this proceeding. There is no evidence that the OSC or its staff acted in bad faith toward the Sharpes.
The OSC included the confidential documents in the court application based on a mistaken interpretation of the Ontario Securities Act. At the time, the Act allowed OSC staff to use confidential documents in a proceeding before the Tribunal. The Act has since been amended to allow the OSC to use confidential documents in a court application like the application to appoint a receiver. The public interest in holding the hearing, which deals with extremely grave allegations, overrides the interests in favour of granting a stay.