In a precedent-setting decision released today, a panel of the Alberta Securities Commission has concluded that interests in land as sold by The Land Development Company Inc. and Phil Archer are investment contracts, and are therefore securities under the Alberta Securities Act.

The commission has also found that by selling these interests to members of the public, The Land Development Company Inc. and Archer as president, traded in securities without being registered or filing a prospectus.

This matter brought an important legal issue that has not been previously determined in Canada before the ASC. “While there is a plethora of American and Canadian case law on the subject of what constitutes an ‘investment contract’, the case law is not easily reconciled and none cited involves facts exactly like those in this case,” said the panel in their decision.

The panel also concluded that this case is unusual in that “there is a need to address how these types of investments can be brought into compliance with the Act, which is probably more urgent than the need to address what orders, if any, ought to be made.”

The hearing will reconvene at a later date to consider what orders should be made in the public interest. A copy of the Decision is available at www.albertasecurities.com.

The Land Development Company Inc., under principal Phil Archer, sold undivided interests in Bearspaw Ranche Estates and Bearspaw Ridge between 1999 and 2000.