Case Summary: Marlin Investments v. Canaccord

Issues

This case [B.C. Court of Appeal, September 25, 2014] addresses (1) the "know your client" (KYC) standard in the context of KYC forms, (2) off-setting investment gains to reduce losses in damage quantification and (3) contributory negligence of a vulnerable (geriatric) client, all in the context of the market crash of 2008.

Key Facts

This was a civil claim for investment losses brought by an elderly (around age 80 at the relevant time) and long-retired former investment professional. The investment program in issue involved a complex options strategy that was very successful until it fell victim to the market crash of 2008. Prior to the crash the client had earned over $90,000 from the strategy, but in 2008, lost over $300,000. The evidence was that the client signed KYC forms indicating that he had income and substantial assets, whereas he had neither (he was retired and was trying to claw his way back to financial health after past losses).