Wayne Gordon Dodge v Ian Bruce Snow

In the appeal of Wayne Gordon Dodge versus Ian Bruce Snow, the Court of Appeal of New Zealand reviewed the decision of Master Venning, who had found that Mr Snow had an arguable defence to Mr Dodge's claim and denied summary judgment. The appeal centred on the interpretation and application of sections of the Securities Act 1978. The dispute originated from Mr Dodge's purchase of shares in Get Met Titles Ltd, a company where Mr Snow was a director. The crux of the matter was whether the shares were offered to the public without a registered prospectus, which would be a violation of the Act, and if Mr Snow could be held liable for not repaying the consideration within the stipulated period.

The legal issues before the court were whether the advertisement placed by Get Met constituted an offer to the public, if Mr Dodge could be considered a member of the public for the purposes of the offer, and if the shares had been allotted with a view to being offered to the public. The court had to determine if the advertisement was an offer under the Act, if Mr Dodge's relationship with Mr Snow and Get Met qualified him as a member of the public, and if the shares were originally allotted with the intent to be offered to the public. The court's analysis focused on the interpretation of the relevant sections of the Securities Act 1978, particularly sections 2, 3, 6, 33, and 37.

The Court of Appeal concluded that the advertisement could be considered an offer to the public in the form of an invitation to treat, but that the subsequent offers made to Mr Dodge were distinct from the initial offer. The court held that for liability under section 37(6) to arise, there must be a connection between the unlawful offering of the security to the public and the subscription made by Mr Dodge. As Mr Dodge was not aware of the initial offer and it did not play a part in attracting him to the issuer, the court found no breach of section 37(1). Furthermore, the court agreed with Master Venning's finding that it was arguable whether Mr Dodge was a close business associate of Get Met when the shares were offered to him in December 1997. In March 1998, however, Mr Dodge had been actively involved in Get Met's business for several months, making it arguable that he was no longer a member of the public.

The court found that there were factual issues concerning the original allotment of the shares to Mr Snow, and whether they were allotted with the view to being offered to the public. These issues could not be resolved based on the affidavits presented. Consequently, the appeal was dismissed, and the appellant was ordered to pay the respondent's costs, including travel and accommodation expenses for counsel.