THE CORPORATIONS LAW

CHAPTER 6D - FUNDRAISING

PART 6D.3 - PROHIBITIONS, LIABILITIES AND REMEDIES

Division 1 - Prohibitions and liabilities

SECTION 729   RIGHT TO RECOVER FOR LOSS OR DAMAGE RESULTING FROM CONTRAVENTION  

729(1)  Right to compensation.  

A person who suffers loss or damage because an offer of securities under a disclosure document contravenes subsection 728(1) may recover the amount of the loss or damage from a person referred to in the following table if the loss or damage is one that the table makes the person liable for. This is so even if the person did not commit, and was not involved in, the contravention.

--------------------------------------------------------
People liable on disclosure document         [operative]
--------------------------------------------------------
   These people . . .         are liable for loss or
                              damage caused by. . .
--------------------------------------------------------
 1 the person making the      any contravention of
   offer                      subsection 728(1) in
                              relation to the disclosure
                              document
--------------------------------------------------------
 2 each director of the       any contravention of
   body making the offer      subsection 728(1) in
   if the offer is made by    relation to the
   a body                     disclosure document
--------------------------------------------------------
 3 a person named in the      any contravention of
   disclosure document        subsection 728(1) in
   with their consent as a    relation to the disclosure
   proposed director of       document
   the body whose
   securities are being
   offered
--------------------------------------------------------
 4 an underwriter (but not    any contravention of
   a sub-underwriter) to      subsection 728(1) in
   the issue or sale named    relation to the disclosure
   in the disclosure          document
   document with their
   consent
--------------------------------------------------------
 5 a person named in the      the inclusion of the 
   disclosure document        statement in the
   with their consent as      disclosure document
   having made a
   statement:

   (a) that is included in
       the disclosure
       document: or

  (b) on which a statement
      made in the disclosure
      document is based
--------------------------------------------------------
 6 a person who               that contravention
   contravenes, or is
   involved in the
   contravention of,
   subsection 728(1)
--------------------------------------------------------
          

Note:

Item 2 - director includes a shadow director (see section 9).

729(2)  [Deemed reliance]  

A person who acquires securities as a result of an offer that was accompanied by a profile statement is taken to have acquired the securities in reliance on both the profile statement and the prospectus for the offer.

729(3)  [Time limit for cause of action]  

An action under subsection (1) may begin at any time within 6 years after the day on which the cause of action arose.

729(4)  [Other law]  

This Part does not affect any liability that a person has under any other law.

Note:

Conduct that contravenes subsection 728(1) is expressly excluded from the operation of section 995.