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The Supreme Court of British Columbia has rejected a proposed legal challenge from a former financial advisor facing enforcement proceedings by the B.C. Securities Commission (BCSC).

The challenge argued that exercising the regulator’s investigative powers violated solicitor-client privilege.

In 2022, the BCSC issued a notice of hearing against Jean Andre Lamarche — a former rep who was last registered in 2013 — alleging that he violated securities law by trading and advising clients without being registered.

Those allegations have not been proven.

In the meantime, Lamarche filed an action arguing that a provision of the Securities Act — which a BCSC investigator used to request phone records — is unconstitutional. He also argued his rights under the Charter of Rights and Freedoms were violated.

The BCSC asked the court to stay Lamarche’s constitutional claims and strike his claims for damages on the basis that the action is premature, given the ongoing enforcement proceeding before the commission.

The regulator argued the privacy issues could be raised during its enforcement hearing, and that Lamarche “should not be permitted to take an end run around the commission proceedings by launching a pre-emptive collateral attack,” according to the decision.

Lamarche opposed the regulator’s application, arguing there were exceptional circumstances that justify early intervention, the decision said.

The court sided with the BCSC.

“While the plaintiff may well have a case, I am not satisfied that the case is so strong as to render it exceptional,” the decision said. “Rather, like other Charter challenges to the Securities Act and other legislation throughout the country, a first instance decision should come from the relevant [regulator].”

The court ruled that addressing the constitutional issues in court before the BCSC hearing could fragment the proceedings and waste legal resources. The court stayed the constitutional claims, saying “the administrative process should be allowed to run its course.”

The court also struck Lamarche’s claim for damages under privacy legislation, citing the regulator’s statutory immunity for acts done in good faith, and the lack of a reasonable claim for damages.