The Court of Appeal has ruled against Blue Chip investors trying to cancel agreements to buy apartments in Auckland.

When the Blue Chip group of companies collapsed in 2008, hundreds of investors suffered substantial losses.

The case before the Court of Appeal related to investors who, as part of their investments with Blue Chip, signed unconditional agreements to buy apartments in three developments in Auckland.

They bought off the plans on the basis that the apartments would be built with settlement to take place usually 18 to 24 months later, the Court of Appeal said.

Under investment agreements with Blue Chip, the investors were entitled to certain financial returns and other assistance.

The developers involved were not part of the Blue Chip group and when the apartments were built they called on the investors to settle the purchases.

The investors faced difficulties raising the funds and tried to cancel the purchase agreements.

A substantial number of selected investors bought a test case seeking declarations they were entitled to cancel, but the High Court found the investors were not entitled to do so.

Five investors were then selected as test cases for appeals, seeking to bring in the Court of Appeal three new arguments that had not been raised in the High Court.

The Court of Appeal said it had decided the investors should not be permitted to amend their case and advance those arguments.

It found that would have caused serious prejudice to the developers since they had not had the opportunity to counter them with evidence in the High Court.

The Court of Appeal said it was, in any event, not satisfied any of the proposed new arguments had any realistic prospect of success.

It had decided the investment agreements entered into between Blue Chip companies and the investors were not subject to the Securities Act.

Blue Chip had not breached requirements of the Securities Act under which a registered prospectus or authorised advertisement needed to be available for investors in cases where the Act applied, the Court of Appeal said.

It held that even if Blue Chip had breached the Securities Act, the separate purchase agreements between the investors and the developers were not affected.

A formal decision in relation to other investors beyond the five selected as test cases had been reserved, with the issue of court costs reserved for further consideration, the Court of Appeal said.