Tribunals are becoming increasingly strict about granting adjournments. Many now address in their rules of procedure the need for parties to be ready to proceed on scheduled dates. Of course, an adjournment will still be available, even when requested at the last minute, where it is needed to permit a registrant to make full answer and defence.
One of the more challenging bases for adjudicating an adjournment request is where new counsel is retained shortly before the hearing. Unprepared counsel can easily render a hearing unfair. Also, tribunals need to be careful not to intrude into privileged solicitor and client communications where previous counsel has recently been discharged. Ontario’s Divisional Court considered these competing factors in Katebian v. Ontario (Securities Commission), 2025 ONSC 3249 (CanLII). Katebian was alleged to have engaged in securities fraud. Katebian requested an adjournment because new counsel had recently been retained with no explanation as to why this change had been made.
In upholding the denial of the adjournment, the Court considered the impact upon all hearing participants, including witnesses. The Court also ventured into the issue of this lack of explanation:
As it was entitled to do, however, the Commission also considered and weighed the appellants’ reasons for being unable to proceed on the scheduled date…. The Commission was clearly skeptical as to why the appellants and their new counsel were in the situation they were in. The Commission noted that: (i) the appellants had been represented throughout, and their original counsel did not advise OSC staff or the Commission until the final interlocutory attendance that he might not appear for them at the hearing; (ii) the appellants gave notice two days later that they intended to appear on their behalf, but offered no reason for this decision; and (iii) two weeks later, they changed their position and decided to be represented, whereupon they retained new counsel rather than reappointing their original counsel, but again offered no reason for doing so. It is clear from the Commission’s reasons that it did not find the reason for the adjournment request to be compelling on the evidence the appellants provided. That assessment was well within the Commission’s discretion.
The Court also considered whether the ability of Katebian to make full answer and defence was prejudiced. It observed that during the first days of the hearing (before a break in the proceedings) much of the evidence was not controversial. The tribunal had also made accommodations to ensure that Katebian’s new counsel was able to cross-examine the witnesses effectively during the first week or that the cross-examination could continue after the break in the hearing.
Katebian also argued that later in the hearing the tribunal had refused to permit counsel to cross-examine a witness on a document that had not been disclosed in advance of the hearing, as required by the rules of procedure. The Court noted that the right of cross-examination in regulatory matters is not as essential as it is in criminal matters. In any event, in the context, no substantial prejudice resulted.
On a more esoteric point involving sanction, the Court also held that a disgorgement order of $8,711,138.00 could be made even though Katebian did not personally obtain that amount in the fraud.
This decision indicates that courts will scrutinize refusals of adjournment to assess whether a registrant’s right to make full answer and defence was actually impaired, especially where the grounds given for the request were not persuasive.