Regulatory Investigations: Applying "Jarvis" In The Securities Context

1) INTRODUCTION

In R v. Jarvis,¹ the Supreme Court of Canada set out the test for determining when Charter rights are engaged in the context of a regulatory investigation conducted by regulatory officials. Writing for the Court, Iaccobucci and Major JJ. stated that evidence may be validly compelled using statutory inquiry or inspection² powers as long as the "predominant purpose" of the inquiry is not "penal liability".³ Once the predominant purpose of the inquiry or inspection is penal liability, an adversarial relationship between the state and the individual crystallizes and the "Rubicon" or "point of no return" has been crossed.⁴ In such instances, the "full panoply" of Charter rights is available to the individual, requiring the regulator to cease using regulatory compulsion powers and to make use of criminal investigative tools, such as search warrants.⁵ Among the Charter rights most often at issue in the case of regulatory investigations are the