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Litigation - Estate agent entitled to commission
29 November 2011
On 21st November 2011 the High Court found that an estate agent was entitled to commission on finding a purchaser for a property despite completion not taking place.
The estate agent Claimant agreed to act as sole agent for the Defendant owner on a 2.5 million pound sale. The Claimant introduced a purchaser, who signed contracts but failed to complete because (it is believed) lack of funds. The property was eventually sold, without the Claimant's involvement, to a developer. The Claimant sued for its commission. The Defendants argued that (i) it was an express term of the agency contract that any purchaser would be a cash buyer; (ii) that the Claimant stated that the buyer had "money to invest" and this induced them to enter the contract; and (iii) the provision for payment of commission on exchange of contracts was unfair.
The Court preferred the Claimant's evidence over that of the Defendant as to the alleged express term. It considered it unlikely such express term was included in the contract particularly on a 2.5 million pound sale. Further, the representation (if any) could amount to no more than an indication that the purchaser was interested in purchasing the property and in any event, no right in law arose because the Claimant was not a party to the sale contract; and all the Claimant had to do to become entitled to commission was introduce a buyer who entered a contract for sale. It was not necessary to consider the question of fairness of that provision.
The Claimant succeeded in its claim.
Foxtons Ltd -v- (1) Desmond O'Reardon (2) Diana O'Reardon [2011] EWHC 2946 (QB)
Should you wish to discuss any claim, whether you are claiming or defending, please feel free to contact our Litigation Team for a free exploratory discussion.
Andrew Petchey, Partner, Litigation Team, Howell Jones solicitors
