The issue of “materiality was recently considered by the Supreme Court of Canada in Sharbern Holding Inc. v. Vancouver Airport Centre Ltd. (2011).
The important aspects of the test for materiality are considered from the perspective of a reasonable purchaser and appear to be as follows:
- Materiality is determined objectively
- an omitted fact is material if there is a substantial likelihood that it would have been considered important
- an omitted fact is material if there is a substantial likelihood that its disclosure would have significantly altered the total mix of information made available
- the proof required is a substantial likelihood it would have assumed actual significance
- materiality involves the application of a legal standard to particular facts.
- it is a fact-specific inquiry, to be determined on a case-by-case basis
So, all in all, for something to be considered material it must be:
2) in the total mix of information, and
3) have assumed actual significance,
4) on the basis of the facts.
If that is the case, then it will likely meet the threshold for materiality as established by the Supreme Court of Canada.
Brian Madigan LL.B., Broker