George et al. v. Dominick Corporation of Canada

George et al. v. Dominick Corporation of Canada

The appeal is dismissed: the alleged misrepresentation and negligence were not proven to be material or inducive, and the broker validly and reasonably closed out the short positions; clause 7 of the Customer’s Agreement expressly authorized the broker to close out marginal accounts or extinguish indebtedness for its protection.

Citation
[1973] SCR 97
Parties
Plaintiff/appellant: David George; Plaintiff/appellant: Louis Miklovic; Defendant/respondent: Dominick Corporation of Canada
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
29 June 1972
Procedural Posture
Civil Appeal (securities) / On Appeal to the Supreme Court of Canada From the British Columbia Court of Appeal
Outcome
Appeal dismissed with costs
Legal Topics
Short Sales, Margin Requirements, Broker’s Power to Close Out Accounts, Rescission, Damages
Source Language
English
Securities Law Contract Law Tort — Negligence Misrepresentation Short Sales Margin Requirements Broker’s Power to Close Out Accounts Rescission +1 more

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Parties

David George

Plaintiff/appellant

Louis Miklovic

Plaintiff/appellant

Dominick Corporation of Canada

Defendant/respondent

Procedural Posture

Civil Appeal (securities) / On Appeal to the Supreme Court of Canada From the British Columbia Court of Appeal

Legal Issues

  1. 1 Whether the broker made a material misrepresentation or was negligent regarding margin requirements
  2. 2 Whether the broker was justified in closing out customers' short positions on January 23, 1968
  3. 3 Whether clause 7 of the customer agreement authorized summary closing out without notice

Ratio Decidendi

The appeal is dismissed: the alleged misrepresentation and negligence were not proven to be material or inducive, and the broker validly and reasonably closed out the short positions; clause 7 of the Customer’s Agreement expressly authorized the broker to close out marginal accounts or extinguish indebtedness for its protection.

Court Disposition

Appeal dismissed with costs

Orders

  • Appeal dismissed with costs to the respondent