Eric Meserve Houghton v Timothy Ernest Corbett Saunders, Samuel John Magill, John Michael Feeney, Craig Edgeworth Horrocks, Peter David Hunter, Peter Thomas and Joan Withers, and Credit Suisse Private Equity Inc, and Credit Suisse First Boston Asian Me - SC 135/2016

A  The appeal in relation to the fourth and fifth respondents is dismissed.
B  The appeal in relation to the first, second and third respondents is allowed to the limited extent described below.
C  The Court of Appeal’s finding that the forecast of revenue for the financial year ended 30 June 2004 (the untrue statement) was, at the time of allotment of the shares offered for subscription in the Feltex prospectus, an untrue statement for the purposes of s 56 of the Securities Act 1978, is upheld.
D  The Court of Appeal’s findings that the untrue statement did not give rise to liability under s 56 of the Securities Act 1978 and was not in breach of s 9 of the Fair Trading Act 1986 are set aside.
E  We find that the untrue statement was in breach of s 9 of the Fair Trading Act 1986.
F  The questions of whether plaintiffs represented by the appellant: (i) invested on the faith of the prospectus in terms of s 56 of the Securities Act 1978 and, if so; (ii) suffered any loss by reason of the untrue statement in terms of s 56 of the Securities Act 1978 and, if so, the quantum of such loss; and (iii) are entitled to any remedy under the Fair Trading Act 1986 are left for resolution by the High Court at the stage 2 hearing.
G  In all other respects, the appeal in relation to the first to third respondents is dismissed.
H  Costs in this Court and the Courts below are reserved. Submissions on costs should be filed and served according to the following timetable: (i) Appellant: 20 working days after the date of this judgment. (ii) First to third respondents: 10 working days after the appellant’s submissions are filed. (iii) Fourth and fifth respondents: 10 working days after the first to third respondents’ submissions are filed. (iv) Appellant in reply: 10 working days after the fourth and fifth respondents’ submissions are filed.
15 August 2018
_________________________________
A The first to third respondents must pay the appellant costs of $30,000 plus usual disbursements.
B Costs in the High Court should be reconsidered by that Court in light of this Court’s judgment in Houghton v Saunders [2018] NZSC 74 and this judgment.
C Costs in the Court of Appeal should be determined in light of this Court’ s judgment in Houghton v Saunders [2018] NZSC 74 and this judgment if the agreement between the parties as to costs in that Court expressly or impliedly allows for such a determination to occur.
22 November 2018