12 Oct 2016
HOUGHTON v SAUNDERS AND ORS [2016] NZCA 493
- Citation
- [2016] NZCA 493
- Court
- Court of Appeal
Appeal dismissed. The Court held that s 55 provides an exhaustive statutory framework for what constitutes an 'untrue statement' in a prospectus and requires identification of particular statements or linked omissions; s 56(1) requires proof of loss 'by reason of' an untrue statement so liability depends on materiality and causation assessed by reference to the notional prudent non-expert investor (objective and fact‑sensitive); the due diligence defence is only available where defendants had reasonable grounds to believe statements true (not where they knew statements untrue); the trial judg…