Practitioners advising on whether solicitations constitute invitations to the public should note that approaching individuals, even strangers, does not of itself constitute an invitation to the public; the invitation must be general in character and capable of acceptance by any member of the public.
Later decisions that cite Lee v Evans
LEE v. EVANS [1964] HCA 65; (1964) 112 CLR 276
Business Names
High Court of Australia
Barwick C.J.(1), Kitto(2), Taylor(3), Windeyer(4) and Owen(5) JJ.
CATCHWORDS
Business Names - Prohibition of use of or reference to business name in invitation to the public to deposit money with or lend money to proprietor of the business name - "Invitation to the public" - Invitation to two individuals as members of the public - Registration of Business Names Act, 1928-1961 (S.A.), s. 4a.
HEARING
Adelaide, 1964, September 22;DECISION
November 5.2. Section 4a (1) of the Registration of Business Names Act, 1928- 1961 provides: - " (1) Notwithstanding any other provision of this Act, where a firm, individual or corporation carrying on business in South Australia under a business-name is registered or required to be registered under this Act in relation to that business-name, no person shall use or make reference to that business-name in any invitation to the public, or in any advertisement inviting the public, to deposit money with or lend money to that firm, individual or corporation. Penalty: Five hundred pounds." (at p279)
3. The evidence given before the magistrate by Owen Claude Broadbent and his
son John Noel Broadbent, both of whom were pastoralists
and who were both seen
at Whyalla by the appellant at the same time, established that the appellant,
being theretofore unknown to
either of them, introduced himself as having some
connexion with a man named Galpin who, he said, was a timber getter,
principally
taking out redgum sleepers from areas along the Murray, and that
he, the appellant, was trying to form a timber business, "Chowilla
Timber
Supplies", into a company having sufficient members and size to be brought
"into the Stock Exchange". The appellant asked
them whether they would put
money into the company by taking shares in it. Ultimately the Broadbents
agreed and each signed a cheque,
one for 200 Pounds and one for 100 Pounds,
made out in favour of Chowilla Timber Supplies, that name being inserted in
each cheque
by the appellant. Owen Claude Broadbent said that the appellant
represented that there would be a profit to him of ten per cent,
and, if he
did not "go the five years", eight per cent. The Broadbents said that in
exchange for their money they expected to receive
shares in the Chowilla
Timber Company. The appellant gave the Broadbents receipts which specified the
200 Pounds and the 100 Pounds
respectively as being "investment in full in
above firm", the above firm being Chowilla Timber Supply Co. Later, letters
each dated
14th August, were written to the Broadbents in the following terms:
-
"Dear Sir,
We have pleasure in thanking you for your investment of 100 Pounds,
in the above company (i.e. Chowilla Timber Supply Co.), interest
payable quarterly, at the rate of ten per cent per annum.
As explained by our representative, your next interest payment
will be posted to you at the end of September". (at p279)
4. These letters were rejected by the magistrate but admitted by the Full
Court, and although not included in the appeal books,
copies of the letter to
Owen Claude Broadbent were supplied to this Court during argument. (at p279)
5. Evidence was given by two other persons named Tuckwell, whom the appellant interviewed on 30th July 1963, and with whom he discussed the investment of money, suggesting the Chowilla Timber Supply Co. as a suitable investment. He persuaded these people to authorize him to dispose of their units in certain unit trust companies and arranged with them to return with the proceeds of the sale of these units, when they would determine how much they wished to invest. These proposals, however, miscarried, due, it would seem, to the intervention of the officers of the unit trusts concerned. (at p280)
6. In answer to a police officer on 12th September 1963 the appellant agreed that he had asked Tuckwells to invest in the Chowilla Timber Supply Co.; and that he did tell Owen Claude Broadbent that if he invested money for five years in the Chowilla Timber Supply Co. he would receive ten per cent per annum paid quarterly, and that he had told him that if he took his money out before five years there would be an adjustment of the interest rate. He agreed that he had visited the Broadbents for the purpose of inviting them to "invest" money with the Chowilla Timber Supply Co. He also answered the following question, "How many people have you visited in this State to raise money for the Chowilla Timber Supply Co.?" with the answer, "I would not know, but about thirty-five families have invested a total of about 26,000 Pounds and they came from all over the State". He was not asked the direct question whether he had invited the Broadbents or, for that matter, any other persons, to lend money to or deposit money with the Chowilla Timber Supply Co. or to or with himself. (at p280)
7. The magistrate found that the appellant on 12th August 1963 at Whyalla invited both the Broadbents to invest in the Chowilla Timber Supply Co. of which he was, in fact, the sole proprietor. He found it proved beyond reasonable doubt that the appellant both used and made reference to the business name Chowilla Timber Supply Co. "in an oral invitation to Owen Claude Broadbent and John Noel Broadbent at Whyalla on 12th August, 1963, to deposit money with and lend money to Chowilla Timber Supply Company, that is, to himself". The magistrate seems to have been prepared to make this finding because, as he says, "Under the circumstances the invitation to invest seems to me to come within the terms 'to deposit money' and also 'to lend money' as that was all that could take place at that stage. . . . no shares were issued . . . and interest appears to have been paid". I take this to be a reference by the magistrate to the fact that, at the date of the invitation to invest, the company in which the shares were to be taken had yet to be formed and that an indefinite delay might occur in its formation. He may well also have had in mind that there probably were references made by the appellant at the time of the interview to the payment of interest meantime. He seems also to have thought that the circumstances that no shares had, in fact, been issued and that interest was, in fact, subsequently paid supported his view that the invitation was of the kind he was prepared to find. (at p281)
8. The magistrate was of opinion, however, that because of the nature of the charge and its particulars, there could not be a conviction unless he was satisfied beyond reasonable doubt that the oral invitation made to the Broadbents at Whyalla on 12th August 1963 was an invitation to the public. In the result, he was not prepared so to find. He held that the invitation to the Broadbents on 12th August was not an invitation to the public generally and was not capable of being acted upon by any member of the public. Accordingly, he dismissed the complaint. (at p281)
9. The informant appealed to the Full Court of the Supreme Court against this dismissal. The Full Court reversed the magistrate, holding that the evidence left its members with no doubt that the invitation to the Broadbents was given to them "as members of the public" and that it was therefore an invitation to the public within the meaning of s. 4a (1) of the Registration of Business Names Act, 1928-1961. Their Honours were of the opinion that "an invitation to the public cannot mean anything but an invitation to members of the public" (1964) SASR, at p 214 and that "it is sufficient" (i.e. to satisfy the statute) "if the invitation is given to the individual as a member of the public" (1964) SASR, at p 216 (at p281)
10. No point was raised before the Full Court and no point is taken in the notice of appeal to this Court that the magistrate ought not to have found that the invitation to the Broadbents was an invitation to lend money to or to deposit money with either the Chowilla Timber Supply Co. or the appellant. The magistrate's finding appears to have been accepted on the footing that although the invitation to the Broadbents was not, in terms, an invitation to deposit or to lend money, such an invitation was implied in the invitation to invest in the circumstances in which that invitation was given. (at p281)
11. The question remains as to whether there was an invitation to the public in connexion with which the appellant on 12th August 1963 made use of or reference to the business name Chowilla Timber Supply Co. It is plain from the particulars of the charge that the case against the appellant was that the invitation to the public was oral and that it was to be found in his conversation with the Broadbents on 12th August 1963. It may be conceded that it may be possible to establish an invitation to the public by proving a series of particular invitations to individuals over so wide a field and in such circumstances or terms as to lead to the inference that an invitation to the public is being made. But apart from the precise form and limiting effect of the charge and of its particulars, such a case could not have been made on the facts of the present case. There was evidence that the appellant invited the Tuckwells to invest in the company but there was no material such as might have justified the magistrate in the case of the Broadbents in inferring, that an invitation to lend money to or to deposit it with the firm or the appellant was involved in his conversation with the Tuckwells. There was, in addition, the admission of the appellant to the police officer that spread over some period of twelve months, a period of which the terminal points were not specified, a number of families upon his solicitation had invested a large sum of money in the Chowilla Timber Supply Co. But there was no material to warrant the conclusion that any or all of this money was obtained in circumstances in which an invitation to lend money or to deposit money had been given. The case therefore stands on the evidence, as it did on the particulars, solely on the oral invitation to the Broadbents given on 12th August 1963. In this connexion, there was some evidence that the Broadbents had been chosen for approach by the appellant because they were shareholders of South Australian Perpetual Forests and, therefore, persons likely to be interested in a timber milling or timber supplying company. (at p282)
12. The section creating the offence with which the appellant was charged was inserted in the Registration of Business Names Act, 1925-1955 by s. 3 of No. 38 of 1961, an Act to amend the Registration of Business Names Act, 1928-1955. The Court is permitted to know that during 1959, 1960 and continuing into 1961 there had been in the community a great increase in public solicitation, principally by advertisement, of the deposit of money either at call or for short terms, and also of the lending of money for longer terms, at rates of interest considerably greater than the then current bank deposit rates. The evident purpose of the amending legislation was to prevent public solicitation to lend or to deposit money by persons, including corporations, trading under business names, without the disclosure of the identity of the person (including a corporation) who was in truth the intended depositee or borrower. The amending section sought to achieve this result by prohibiting the use of a business name in connexion with an invitation to the public to lend or to deposit money. The essentials of the offence which the amending section thus creates are (1) that there shall be an invitation to lend or deposit money to the proprietor of the business carried on under the business name and (2) that such invitation should be an invitation to the public. Thus both the precise nature of the invitation and its public character must be shown. (at p283)
13. It has been submitted to us in substance that the offence is committed whenever a business name which is or ought to be registered under the Registration of Business Names Act is used or referred to in connexion with an invitation to lend or deposit money to or with the firm of that name or its proprietor or proprietors given to any member of the public unless that individual stands in some existing relationship to the invitor or to that firm, or to its proprietor or proprietors, which is the reason for the selection of that individual as an invitee. In other words it is said that the amending section precludes the use of a business name in or in connexion with any invitation to lend to or deposit money with the firm or the proprietor or proprietors which does not arise out of some particular relationship between the person to whom the invitation is issued and the person extending it, or perhaps with the firm or its proprietor or proprietors. This in reality is, in my opinion, what the Full Court decided. But with great respect this is not, in my opinion, the meaning of the amending section. (at p283)
14. The Full Court's reasoning begins with the proposition that the expression "to the public" must take its particular significance from the context in which it is used because it is not an expression of a fixed and universal meaning. So much may be granted and is a good reason for not attempting any general pronouncement as to its signification. Taking a dictionary meaning of "the public" as referring to the community in the aggregate, and therefore as signifying the members of the community, the Court concluded that an invitation would not satisfy the amending section unless some member or members of the public were actually invited. This is, in my view, an equivocal statement. With every respect I am unable to agree with it, if it means that an invitation which is of its nature an invitation to the public must be shown to have reached some specific individual or individuals. Equally, I must disagree if it means that when an invitation has reached some individual or individuals in no other capacity than that of a member or members of the community it is by that very circumstance an invitation to the public. It must be conceded that an announcement which is not an advertisement within the meaning of the amending section, but which in form constitutes an invitation to the public at large, must be published in some fashion if there is to be an invitation to the public: but being published, the use of the business name in association with it either at or subsequently to its publication would constitute an offence under the amending section, although no particular person was shown to have seen or to have received the invitation the announcement conveyed. But the Full Court meant, it seems to me, that upon some member of the public being invited, as such, i.e. for no other reason than that he was one of the general mass of citizens, what I might call the public element of the offence was provided. (at p284)
15. The Full Court in arriving at this view largely relied upon Nash v. Lynde reported in the Court of Appeal (1928) 2 KB 93 and in the House of Lords (1929) AC 158 and, indeed, adopted a paraphrase of a passage from the judgment of Lord Hailsham L.C. in that case (1929) AC, at p 164 But in Nash v. Lynde (1928) 2 KB 93; (1929) AC 158 the question was whether a prospectus, which had been found to be in its nature an invitation to the public to subscribe for or to purchase shares, had been "issued" within the meaning of s. 81 of the English Companies (Consolidation) Act, 1908. The contest was as to whether the issue to be in breach of that section must be an issue to the public generally or whether its issue to any member of the public as an invitation to take shares was sufficient. It was decided that the latter was the correct position. Nash v. Lynde (1928) 2 KB 93; (1929) AC 158 was not a case in which the basis for concluding that there was an invitation to the public had to be found in the nature of the publication or issue of the prospectus. Although a convenient word it might be better not to use the word publication in this context, but to speak only of issue. (at p284)
16. It seems to me that the judgment of Scrutton L.J., in that case (1928) 2 KB, at p 102 does not clearly distinguish between two radically different situations, namely that which arises where an invitation, not in its terms or nature an invitation to the public, becomes such by reason of the circumstances of its issue, (or perhaps here one might properly say publication) and that which arises where an invitation which is in terms or of its nature an invitation to the public is issued, and the circumstances of that issue are examined to determine whether it constitutes an issue in the relevant sense. I find nothing in the judgments of the House of Lords in that case to lead me to think that any of their Lordships endorsed the passage of the judgment of Scrutton L.J. which the Full Court cites from the report in the King's Bench (1928) 2 KB, at p 102 in the sense in which it is read by the Full Court. The contrasting positions are summarily put by Lord Buckmaster where he says: "A document is not a prospectus unless it is an invitation to the public, but if it satisfied this condition it is not the less a prospectus because it is issued to a defined class of the public" (1929) AC, at p 171 Viscount Sumner said of the prospectus that whilst "No particular numbers are prescribed" i.e. in the definition of "the public" in the English Companies (Consolidation) Act, 1908, "Anything from two to infinity may serve: perhaps even one, if he is intended to be the first of a series of subscribers, but makes further proceedings needless by himself subscribing the whole. The point is that the offer is such as to be open to any one who brings his money and applies in due form, whether the prospectus was addressed to him on behalf of the company or not" (1929) AC, at p 169 It is true that Viscount Sumner was of the view that the "issue" within the meaning of s. 81, even of a prospectus which, was itself an invitation to the public, must be an issue to the public and in the passage quoted he may have been treating the case as one in which the nature as an invitation to the public was to be derived from the circumstances of its issue. But, in my opinion, this does not detract from his view as to what was necessary to make the offer an invitation to the public. In this respect what he says is not, in my opinion, inconsistent with the judgment of Swinfen Eady J. in In re South of England Natural Gas and Petroleum Co. Ltd. (1911) 1 Ch 573 That was a case in which his Lordship concluded that there was an invitation to the public, although the issue of the prospectus was not indiscriminate. I do not regard this case as an instance of an invitation which is shown to be an invitation to the public by the circumstances of its issue but rather as a case where an invitation to the public does not cease to be such because it is given a restricted or selective issue. As I have already indicated an invitation which is not ex facie an invitation to the public can be found to be such an invitation because of the nature of the authorized distribution it was given. In such a case the party accountable for its issue would be liable to have the extent of the circulation he had authorized taken into account. See in this connexion Sherwell v. Combined Incandescent Mantles Syndicate (Ltd.) (1907) 23 T.L.R. 482, at p. 483. But whether the question is whether the invitation is ex facie an invitation to the public or whether an invitation has become an invitation to the public by reason of the nature or extent of its issue, the basic concept is that the invitation, though maybe not universal, is general; that it is an invitation to all and sundry of some segment of the community at large. This does not mean that it must be an invitation to all the public either everywhere, or in any particular community. How large a section of the public must be addressed in a general invitation for it to be an invitation to the public in the relevant connexion must depend on the context of each particular enactment and the circumstances of each case. But within that sufficient area of the community the invitation must be general in the sense spoken of by Viscount Sumner in Nash v. Lynde (1929) AC, at p 169, by Warrington J. in Sherwell's Case (1907) 23 TLR, at p 483, "An offer of shares to anyone who should choose to come in", and by Jordan C.J. in Ex parte Lovell; Re Buckley (1938) 38 SR (NSW) 153, at p 159; 55 WN 63, at p 65, "made to the public generally and capable therefore of being acted upon by any member of the public". That those to whose hands such an invitation is intended to come, also stand in some special relationship to the invitor, will not prevent the invitation being an invitation to the public. See In re South of England Natural Gas and Petroleum Company, Ltd. (1911) 1 Ch 573 In my opinion Nash v. Lynde (1928) 2 KB 93; (1929) AC 158 lends no support to the proposition that an invitation to a single individual as a member of the public in the sense that he stands in no special relationship to the invitor is an invitation to the public within the meaning of the amending section. Here the invitation was made to the Broadbents alone. It was not made to anyone else, nor was it capable of being acted upon by anyone else. It was not general but particular to them. Though it would seem that the Broadbents may have been chosen as recipients of the invitation because of their supposed special interest in timber raising or timber selling activities, I find it unnecessary in this case to base any conclusion wholly or partly upon that circumstance. For the purposes of my judgment the Broadbents were merely individuals in the general mass of citizens. (at p286)
17. In my opinion the invitation to the Broadbents was not an invitation to the public within the meaning of s. 4a (1) of the Registration of Business Names Act, 1928-1961 and the magistrate was right in refusing to find that there was any such invitation. The appeal should be allowed. (at p286)
KITTO J. As regards the construction of s. 4a (1) of the Registration of Business Names Act, 1928-1961 (S.A.), I am of opinion that the magistrate was right in holding that the expression "invitation to the public" means an invitation made to the public generally and capable therefore of being acted upon by any member of the public. This appears to me to be the natural meaning of the words, and I see nothing in the context to require or justify the adoption of any other meaning. I regard the conclusion as strongly supported by observations of Warrington J. in Sherwell v. Combined Incandescent Mantles Syndicate (1907) 23 TLR 482, at p 483, of Scrutton LJ in Lynde v. Nash (1928) 2 KB 93, at p 102, of Eve J. in the latter case (1928) 2 KB, at p 116, of Viscount Sumner in the same case on appeal, Nash v. Lynde (1929) AC 158, at p 169, and of Jordan C.J. in Ex parte Lovell; Re Buckley (1938) 38 SR (NSW) 153, at p 159; 55 WN 63, at p 65 (at p287)
2. I am not intending to hold, however, that the size of the immediate audience is necessarily conclusive of the question whether the invitation is an invitation to the public. That is a question of the true scope of the invitation. While it may be answered conclusively in one case by the terms in which the invitation was expressed, it may require in another case a consideration both of the words in which it was expressed and of the circumstances in which they were used. I see no reason to doubt that the statement of an invitation even to one person only may be seen, when considered in the light of all the circumstances, to be part of, even though only the first step in, the communication of the invitation to the public generally, so that if the lone hearer were to tell some stranger of it the stranger would be right in treating it as open to acceptance by him no less than by the hearer. But, with great respect to the learned Judges of the Supreme Court, I think it is going to far to say that proof of an invitation given to a person as a member of the public is necessarily proof of an invitation to the public. If a person, wishing to obtain a loan, makes his request to a stranger whom he picks at random in the street, it remains, I think, a question of fact whether his invitation is to the public or to the selected individual only. In many cases the answer may be easy, but that does not mean that the question is not there to be answered; and in considering the answer the distinction must not be overlooked between the case of an invitation which itself is open to acceptance by any member of the public who may be interested and the case of an invitation which itself is open to acceptance by a specific individual only but, if declined by him, is likely to be followed by similar invitations to other specific individuals in succession until an acceptor is found. The first of these is a case of an invitation to the public; the second, in my opinion, is not. (at p287)
3. Construing the section correctly, as I think he did, the magistrate nevertheless dismissed the complaint because the evidence did not satisfy him beyond reasonable doubt that the invitation which the appellant made to the two Broadbents was an invitation to the public, though he considered that it was, within the meaning of the section, an invitation both to deposit money and to lend money and that it was made to the Broadbents as members of the public. Since the appeal to the Supreme Court was an appeal upon fact as well as law, it is for us to consider, if we think that the Supreme Court's decision proceeded upon a view of the section which should not be upheld, whether we for our part are satisfied beyond reasonable doubt that the offence charged was proved. (at p288)
4. The appellant concedes, and I see no reason to doubt, that every element of the offence charged was proved, subject only to the question whether the invitation was an invitation to the public. Upon that question the magistrate's lack of the requisite satisfaction remained after careful consideration of the evidence given by the witnesses in the case, all of whom had been called by the prosecution. Had the appellant been convicted, I should not have been prepared to hold that there was no evidence to support the conviction. Moreover, if the account given by the witness O.C. Broadbent of his conversations with the appellant, as appearing from the transcript of evidence, were to be accepted as completely accurate I should myself have thought that the offence was proved beyond reasonable doubt. According to that witness the appellant made it very clear, in the course of the invitation in question, that he was engaged in trying to get a sufficient number of people to contribute money for the purpose of forming a company to take over his business and of getting the company listed on the Stock Exchange. His theme, according to the record of the evidence, was that "he was wanting more investors to form a public company". Assuming that what the appellant said to the witness was correctly recounted by the latter, the proper inference seems to me to be that the appellant wanted as many people as possible to lend him money, for which they would get shares if and when the proposed company should be formed and on which interest would begin to accrue at once, and that although he was putting the invitation to the Broadbents as people who he had reason to think might be interested in a timber investment it was a general invitation and was in course of being brought to the attention of as many potential acceptors as possible. (at p288)
5. But the basic assumption is not warranted, for O.C. Broadbent's evidence appeared to the magistrate who heard it to contain "a certain amount of confusion as to just what was said". The same is true, though to a lesser extent, of the evidence of the son, J. N. Broadbent. The magistrate did not doubt the honesty of either, but, where the only witnesses who can depose to the making of an oral invitation, though they be honest, have given the magistrate who tried the case an impression of confusion on the crucial question, namely what exactly was said, and the magistrate in the end has not been satisfied beyond reasonable doubt by that evidence that the invitation really was an invitation to the public in the relevant sense, I do not see how a court of appeal can be so satisfied by a mere reading of the transcript of those witnesses' evidence. (at p289)
6. It is true that a police constable gave evidence, which the magistrate accepted, as to a conversation he had with the defendant a month after the date charged, from which it is clear that the appellant expressly or impliedly admitted both that he had told O.C. Broadbent that he was "going round to various people getting them to invest", and also that thirty-five families, being some only of the people he had visited, had invested a total of about 26,000 Pounds in the Chowilla Timber Supply Company. But that is consistent with the appellant's having made to each of the persons he visited an invitation which could not be construed as an invitation to the public. (at p289)
7. On the whole of the material before us I have come to the conclusion that the case is not one in which the decision of the primary tribunal of fact should be reversed. (at p289)
8. I would therefore allow the appeal and restore the magistrate's order. (at p289)
TAYLOR J. The question we are called upon to consider in this appeal is whether upon the evidence in the case it can be said that an invitation extended to Owen Claud Broadbent and John Noel Broadbent to deposit moneys with or lend money to the appellant was, in the language of s. 4a (1) of the Registration of Business Names Act, 1928-1961, an invitation to the public. The magistrate before whom the complaint came in the first instance was of the opinion that it was not, but upon appeal to the Supreme Court the contrary view was taken and the appellant was then convicted. This decision, it seems to me, rests upon the proposition that an invitation to any member of the public, "as a member of the public", constitutes an invitation to the public. (at p289)
2. With respect to the views of the members of the Full Court I am of the opinion that this broad proposition should be rejected for it takes no account of the character of the invitation which, it seems to me, is the critical question in this case. It is true that the Full Court entertained the view that the invitation to the Broadbents "was an incident in the course of a campaign to raise money from the public" (1964) SASR, at p 216 but there was quite insufficient evidence to establish the nature or character of any invitation extended to any other member of the public. Indeed, it is only proper to say that this question was not the subject of any real inquiry before the magistrate. Consequently, as I see it, the real question before us is simply whether the invitation to the Broadbents can, in the circumstances, be characterized as an invitation to the public. (at p290)
3. It is unnecessary to re-state the facts which have already been fully set out by the Chief Justice but two things must be borne in mind. The first is that it is common ground that the invitation which was proved by the evidence was communicated to the Broadbents alone, and the second, that the Chief Justice has observed, and I agree with him, that this invitation "was not general but particular to them". I mention these matters because I think it is necessary to draw a distinction between the essential character of the invitation and the manner of its communication or publication and it is the former element and not the latter which is ultimately of critical importance in the case. With this distinction in mind I add that in a case where the invitation is in essence an invitation to the public generally it is of no consequence whether it is communicated or published to one or many members of the public whilst in other cases the invitation may be so communicated or so published as to make the invitation, so published or communicated, an invitation to the public. (at p290)
4. In the present case there was, in my view, nothing in the character of the invitation extended to the Broadbents to invest it with the character of an invitation to the public and the evidence does not establish any other publication or communication of a like invitation generally. It may be true, as the Full Court said, that the invitation to the Broadbents was "an incident in the course of a campaign to raise money from the public" (1964) SASR, at p 216 but in order for the prosecution to succeed it was necessary to establish not merely that there was an invitation to the public to entrust moneys to the appellant for the purpose of investment but that there was an invitation to the public to deposit money with or lend money to the appellant and, further, that in extending that invitation the appellant used or made reference to the business name in question. To my mind the evidence is insufficient to establish that this occurred and, accordingly, I agree that the appeal should be allowed. (at p290)
WINDEYER J. The substantial question on which this appeal turns is whether what the appellant did amounted to an "invitation to the public" to deposit money with or lend money to Chowilla Timber Supply Co. "Chowilla Timber Supply Co." was merely the registered business name of the appellant. That the appellant had approached a large number of people and collected a considerable sum of money from them is beyond doubt. But at his trial attention became very largely concentrated on his transactions with the two Broadbents. The magistrate, in a careful survey of the evidence as a whole, said of the testimony of the Broadbents that "there is a certain amount of confusion evident as to just what was said. . . . I can well understand this as it seems that Chowilla Sawmills was also brought into the conversation". Cross-examination of these witnesses had been largely directed to establishing that the invitation to them was not to invest in Chowilla Timber Supply Co. but in Chowilla Sawmills: that was the name in which one Galpin carried on a sawmilling business until July 1963 when the appellant became registered in place of Galpin as carrying on that business also. As I read the magistrate's findings, he thought that the mention of both names had caused some confusion. But his conclusion was quite definite. He said: "I think that the defendant's statements to Constable Thompson show conclusively that, although the witnesses mentioned the references which were made by him to Chowilla Sawmills as well as Chowilla Timber Supply Company, the defendant's real purpose was to get them to invest in Chowilla Timber Supply Company and that he invited both of the Broadbents and Mr. and Mrs. Tuckwell to invest in the Chowilla Timber Supply Company of which he was in fact the sole proprietor". This finding was in my opinion justified by the evidence. Neither in the Supreme Court nor in the notice of appeal to this Court was any point taken that the invitation to invest was not an invitation to deposit money. What is said is that there was no invitation to the public to do so. The magistrate found that the invitations the appellant issued to the Broadbents and the Tuckwells were invitations to deposit money with his "company". If the evidence showed that the invitations to those persons occurred in the course of and as incidents in the appellant's canvassing members of the public generally with similar invitations then in my opinion it would support the charge. However the magistrate, I think, was led into a mistake as to the issue he had to decide. The prosecution gave, and then amended, particulars of the charge, with the result that it was alleged that the invitation to the public was "oral and made to Oliver Claud Broadbent and John Noel Broadbent on 12th August 1963". With the particulars in that form - and it was the form the prosecution chose - the magistrate was not unnaturally led to the view that, as he put it: "The question is whether the oral invitation to Oliver Claud Broadbent and John Noel Broadbent at Whyalla on 12th August 1963 was an invitation to the public, which it must have been before there can be a conviction". It was, however, misleading to formulate the question in that way. An invitation to a particular individual cannot, it seems to me, ever be of itself and without more an invitation to the public; but an approach to an individual may occur in the course of an invitation general in character. (at p292)
2. An invitation can be conveyed or communicated to the public in many ways: in writing, by a notice in the press or posted in a public place conveying an invitation to any reader: orally, by an address to a public meeting or an announcement in a public place: by handing leaflets to passers-by in a public street: by circulars sent through the post: by going indiscriminately from house to house repeating the invitation. The essence of an invitation to the public is not in the manner of its communication or in the number of the persons to whom it is communicated. The criteria are rather, are the recipients of the invitation persons chosen at random, members that is of the general public, the public at large, all and sundry: or are they a select group to whom and to whom alone the invitation is addressed, so that if an outsider sought to respond to it he would be told that he was not one of those invited to come in. We were referred to decisions under the Companies Acts concerning the issue of prospectuses offering shares or debentures to the public. The question there is whether a prospectus, which is by definition intended for the public, has been issued as such. For present purposes the cases show only that the question is one of fact and degree. Their effect is summed up, correctly I think, in Palmer's Company Precedents, 16th ed. (1951) Pt 1, p 10, where it is said: "The test seems to be this - is there a sufficiently intimate subsisting connexion between the company or the person making the offer and the persons to whom the offer is made as friends, customers, or otherwise to make the offer a domestic concern. And it is apprehended that the mere fact that an offer is made by circular addressed by name to a number of persons does not of itself take it out of the category of offers to the public". (at p292)
3. That there was an invitation to the public may be proved by proving an invitation to one person, selected to receive it simply because it was thought he might respond to it, and that substantially similar invitations had been made or were to be made to sundry other persons, members in the same sense of the general public. In my opinion there was evidence of that in this case. The appellant admitted that he had been canvassing people to raise money for his "company". The Broadbents gave evidence that he said that he was approaching other people and that if enough people responded by putting in money the company would seek registration on the stock exchange. The magistrate did not convict the appellant because, having formulated the question for himself in the way he did, he was persuaded that certain dicta of Jordan C.J. in Ex parte Lovell; Re Buckley (1938) 38 SR (NSW) 153; 55 WN 63 were in point. In that case the learned Chief Justice of New South Wales was considering a prohibition of share-hawking, that is to say of going "from house to house or from place to place offering shares for subscription to the public or any member of the public". In the course of his judgment he referred to the meaning that in the prospectus cases had been put on the phrase "offer to the public". And he went on to point out that in the prohibition of sharehawking the words were "the public or any member of the public", wider words than "the public", which was the phrase in the prospectus cases. He said: "It is to be noted that the section is not restricted to offers to the public. In the case of provisions which are so restricted, an offer to the public prima facie connotes an offer of the Carlill v. Carbolic Smoke Ball Co. [1892] EWCA Civ 1; (1893) 1 QB 256 type, namely one made to the public generally and capable therefore of being acted upon by any member of the public" (1938) 38 SR (NSW), at p 159; 55 WN, at p 65 But to apply that remark in the way counsel sought to do here is, I consider, a mistake. The denotation of the phrase "any member of the public" was, it had been argued, restricted by its association with the phrase "the public". It was in the course of dispelling that proposition that Jordan C.J. spoke of the prima facie meaning of the words "an offer to the public". His reference to the Smoke Ball Case [1892] EWCA Civ 1; (1893) 1 QB 256 was by way of illustration only. That case was in a somewhat different field from the present because it concerned an offer acceptance of which by any member of the public would create a binding contract. Such an offer must necessarily be uniform and explicit. But an invitation to the public to deposit money may amount to no more than the soliciting in general terms of offers which may or may not be accepted. It is enough if there be an offer to do business, as distinct from an offer to make a contract. However, the distinction does not make the illustration of a public offer that Jordan C.J. gave inapt here. Whether or not the proposal be an offer or an invitation, it cannot be an offer or an invitation to the public if it be addressed only to a particular person. All that Lovell's Case (1938) 38 SR (NSW) 153; 55 WN 63 decided is that an offer to "a member of the public" does not cease to be so because it is not made to the public at large. That has no direct bearing on the facts of this case. (at p294)
4. The question in this appeal is whether the Supreme Court was justified in holding that on the evidence the offence charged was proved. The evidence from which it could be inferred that there was an invitation to the public and that the appellant approached the Broadbents and others in the course of making that invitation was far from full. Nevertheless, without agreeing in all that is said in the judgment of the Supreme Court, I consider that their Honours' conclusion is correct. The evidence does, I think, justify their statements that "it is obvious that these transactions (scil. the invitations to the Broadbents) were incidents in a campaign to raise money according to a settled plan or system" (1964) SASR, at p 212: that the only reason the appellant had for approaching the Broadbents was "the possibility that they might be persuaded to lend him money" (1964) SASR, at p 217: that his doing so was "an incident in the course of a campaign to raise money from the public" (1964) SASR, at p 216 Those statements are not I think inconsistent with any findings of the magistrate as to the facts. As I read what he said, he dismissed the charge because he was led by the form of the particulars into a misapprehension of the issue. (at p294)
5. I would dismiss the appeal. (at p294)
OWEN J. I agree that for the reasons given by Kitto J. the appeal should be allowed. (at p294)
ORDER
Appeal allowed with costs. Order of the Supreme Court set aside and in lieu thereof order that the appeal to the Supreme Court be dismissed with costs.