This is an individual assignment. Please remember that marks will be deducted for serious errors of spelling and grammar. Do not cut and paste your answer. Explain the law in your own words as if to a client who has lost money and wonders whether she has any remedy.

TASK: Review the facts of Hercules Management v Ernst Young (1997) 2 S.C.R. 165. This case has been said to relieve auditors of most responsibility for negligence. Since the case was decided, the Enron scandal forced governments in both the U.S. and Canada to revisit the issues of corporate governance. The Ontario Securities Act has been amended in an attempt to increase investor confidence in the markets. Review the legislation, in particular Part XXIII.1, Civil Liability for Secondary Market Disclosure, and discuss how a similar fact situation to that of Hercules Management would be resolved today. Your answer must include references to the relevant sections of the Act. You should compare and contrast the requirements of a successful lawsuit in tort and under the Act. This will include addressing the issues of duty of care, breach of standard, causation and loss. You should also consider the burden of proof the plaintiff bears in order to begin a lawsuit; the relevance of proportionate liability and liability caps; the issue of costs; You should also explain any defences open to the defendant. If a defendant is found liable, what would be the financial consequences? Finally you must discuss whether, in your informed opinion, these changes are sufficient to deal with the problem of negligent misrepresentation.