LETTERS TO THE EDITOR — `Unfounded’ conclusions in Seabright

It is most unfortunate that Ian Booth would comment upon a case which is so complex and so obviously out of his league (“Judge finds in Seabright’s favor,” T.N.M., April 5, 1993).

Mr. Booth’s conclusion that “drill results appear to be merely future estimates that need not be disclosed as material changes” is wrong. As any lawyer knows, courts take the stated law and review the facts of the case before them to determine whether the case falls within the law. In one of the most exhaustive and diligent reviews of the facts that I have ever read, Mr. Justice Merlin Nunn takes the facts of the Seabright case and reviews them in light of the law, not against some statement of fancy. Mr. Booth neglects to refer to Section 1(d) of the Ontario Securities Act and National Policy 40 on timely disclosure which section and policy statement define “material fact,” “material changes,” and “material information.” Contrary to Mr. Booth’s bold and unfounded conclusion, Mr. Justice Merlin Nunn considered the salient facts and found that there was no material change at the relevant time.

The point is (that) what constitutes a material change is something that has to be decided by a company with its advisers in light of all the information available to them at the time and in regard to all the information which had been previously disclosed.

Justice Merlin Nunn found, as a matter of fact, that at the stage that Westminer sought to acquire Seabright, Seabright was still testing to determine the appropriate means of mining.

Given the public record and the statements made publicly by Seabright, Westminer could have got, and in fact had, enough information to put them on notice to ask questions (at the bare minimum). This they did not do and they were found to be reckless.

In other words, enough information was available to the “giant” to evaluate fully a decision to acquire Seabright. Westminer had the expertise to appreciate fully the significance of the exploration and bulk-sampling programs and their results. It is clear from the facts that their haste to acquire Seabright at bargain basement prices during Christmas, 1987, was Westminer’s downfall.

Nancy Ripley-Hood, Solicitor

Nova Scotia Dept. of

Natural Resources