(1) This section applies where:

(a)

a securities adviser contravenes section 849 or 851 in relation to a securities recommendation to a person (in this section called the client ); and

(b)

the client, in reliance on the recommendation, does, or omits to do, a particular act; and

(c)

it is reasonable, having regard to the recommendation and all other relevant circumstances, for the client to do, or omit to do, as the case may be, that act in reliance on the recommendation; and

(d)

the client suffers loss or damage as a result of that act or omission.

(2) Subject to subsections (3) and (4), the securities adviser is liable to pay damages to the client in respect of that loss or damage. (3) In the case of a contravention of section 849, the securities adviser is not so liable if it is proved that a reasonable person in the client's circumstances could be expected to have done, or omitted to do, as the case may be, that act in reliance on the recommendation even if the securities adviser had complied with that section in relation to the recommendation. (4) In the case of a contravention of section 851, the securities adviser is not so liable if it is proved that the recommendation was, in all the circumstances, appropriate having regard to the information that, when making the recommendation, the securities adviser had about the client's investment objectives, financial situation and particular needs.