THE CORPORATIONS LAW

CHAPTER 7 - SECURITIES

PART 7.3 - PARTICIPANTS IN THE SECURITIES INDUSTRY

Division 2 - Agreements with unlicensed persons

Subdivision B - Effect on agreements

SECTION 798   CLIENT MAY GIVE NOTICE OF RESCISSION  

798(1)  (Client may give written notice)  

Subject to this section, the client may, whether before or after completion of the agreement, give to the non-licensee a written notice stating that the client wishes to rescind the agreement.

798(2)  (Notice to be given within reasonable time)  

The client may only give a notice under this section within a reasonable period after becoming aware of the facts entitling the client to give the notice.

798(3)  (When notice may not be given)  

The client is not entitled to give a notice under this section if the client engages in conduct by engaging in which the client would, if the entitlement so to give a notice were a right to rescind the agreement for misrepresentation by the non-licensee, be taken to have affirmed the agreement.

798(4)  (Where non-licensee has informed client of status)  

The client is not entitled to give a notice under this section if, within a reasonable period before the agreement was entered into, the non-licensee informed the client (whether or not in writing) that:

(a)  the non-licensee did not hold a dealers licence; or

(b)  the non-licensee did not hold a dealers licence and did not hold an investment advisers licence;

as the case requires.

798(5)  (Licence suspended)  

If, at a time when a dealers licence or investment advisers licence held by the non-licensee was suspended, the non-licensee informed the client that the licence was suspended, the non-licensee is to be taken for the purposes of subsection (4) to have informed the client at that time that the non-licensee did not hold a dealers licence or investment advisers licence, as the case may be.

798(6)  (Subsections do not limit generality of each other)  

None of subsections (2), (3) and (4) limits the generality of either of the others.

798(7)  (Conditions not affecting right to give notice)  

Subject to this section, the client may give a notice under this section whether or not:

(a)  the notice will result under section 799 in rescission of the agreement; or

(b)  the Court will, if the notice so results, be empowered to make a particular order, or any order at all, under section 800.