PJC Business

F RAUD AND N EGLIGENT M ISREPRESENTATION

PJC 105.14

PJC 105.14 Question on Defenses to Violation of Texas Securities Act—Factual Misrepresentation If you answered “Yes” to Question ______ [ 105.12 ], then answer the follow ing question. Otherwise, do not answer the following question. QUESTION ______ Do you find that Paul Payne knew, by the time of the [ purchase/sale ], of the untruth or omission found by you in your answer to Question ______ [ 105.12 ]? Answer “Yes” or “No.” Answer: _______________ COMMENT When to use. PJC 105.14 submits one of the two affirmative defenses to liability for a securities violation. See Tex. Gov’t Code §§4008.052, 4008.053 (formerly Tex. Rev. Civ. Stat. art. 581–33A(2), 33B); Sterling Trust Co. v. Adderley , 168 S.W.3d 835, 843 (Tex. 2005); Williams v. Khalaf , 802 S.W.2d 651, 656 n.3 (Tex. 1990). PJC 105.15 submits the other defense. An affirmative answer to either question is a defense to lia bility. See Sterling Trust Co. , 168 S.W.3d at 843. Broad-form submission. PJC 105.14 is a broad-form question designed to be accompanied by one or more appropriate instructions. Tex. R. Civ. P. 277 requires that “the court shall, whenever feasible, submit the cause upon broad-form questions.” Tex. R. Civ. P. 277; see Thota v. Young , 366 S.W.3d 678, 689 (Tex. 2012) (rule 277’s use of “whenever feasible” mandates broad-form submission in any or every instance in which it is capable of being accomplished).

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