We reverse. See WIPF v. General Discount Corp., 1971, 86 S.D. 148, 192 N.W.2d 727; Hofer v. General Discount Corp., 1971, 86 S.D. 133, 192 N.W.2d 718; State v. Smith, 1970, 85 S.D. 275, 181 N.W.2d 451. For copies of the debentures and certificates, see: Hofer v. General Discount Corp., 86 S.D. at 135-136, 192 N.W.2d at 720.

As a general rule remedial legislation, such as enacted here to protect the unwary buyer, should be liberally construed to effect that purpose. Hofer v. General Discount Corporation, 192 N.W.2d 718 (S.D. 1971). It is the plaintiff's contention that the defendants offered to sell or offered for sale securities to Boehnen in South Dakota; i.e., the defendants solicited Boehnen's business over the telephone from New York. This contention is disputed by the defendants.

The sophistication of a party to a contract is a consideration in contract analysis. See, e.g., Wolken v. Erck, 421 N.W.2d 63, 66 (S.D. 1988); Hofer v. General Discount Corp., 86 S.D. 133, 145, 192 N.W.2d 718, 725 (1971). The Directors, none of whom were familiar with corporate formalities, are unsophisticated investors.

[¶ 8] This case presents a question of first impression in South Dakota. "We start with the proposition that statutes governing the registration and sale of securities are remedial in nature and are designed to protect the unwary buyer and thus should be liberally construed." Hofer v. General Discount Corp., 192 N.W.2d 718, 722 (SD 1971). However, to receive this liberal construction Tschetters must establish that the units they purchased are securities.

This appeal pertains to the sale of unregistered securities in the State of South Dakota and is governed by SDCL ch. 47-31 of the South Dakota Codified Laws. This Court has heretofore ruled on the intent of this chapter, expressing in Hofer v. General Discount Corp., 86 S.D. 133, 139, 192 N.W.2d 718, 722 (1971), that "statutes governing the registration and sale of securities are remedial in nature and are designed to protect the unwary buyer and thus should be liberally construed to effect the purpose for which the statutes were adopted." Here, plaintiffs/Wolkens, as father/son team, purchased ten and one-third shares of VMI stock (stock in a gold mine) in March 1982 for a total purchase price of $124,000.

This is an appeal by General Discount Corporation (General Discount) and William M. Smith (Smith) from a judgment in favor of plaintiff Andrew Z. Wipf in his suit against General Discount, Smith and Andrew Aman. The trial court dismissed the complaint aganist Andrew Aman. The factual background of this case is in many respects similar to that in the case of Hofer v. General Discount Corp., 86 S.D. 133, 192 N.W.2d 718, and we refer to that case for further particulars. Sometime prior to 1960, plaintiff purchased from General Discount certain guaranteed debentures in the principal amount of $7,500, maturing in five years and bearing interest at the rate of 7% per annum.