McAndrew v Miller Insurance Agency Ltd

• Jurisdiction: Antigua and Barbuda
• Court: Court of Appeal (Antigua and Barbuda)
• Judge: Lewis C.J.,Gordon, J.A.
• Judgment Date: 16 March 1971
• Neutral Citation: AG 1971 CA 2
• Docket Number: Civil Appeal No. 2 of 1970
• Date: 16 March 1971

Court of Appeal

Lewis, C.J.; Gordon, J.A.; Lewis, J.A.

Civil Appeal No. 2 of 1970

Miller Insurance Agency Ltd.

and

McAndrew

Appearances:

C.E. Hewlett for the appellant

C.E. Francis for the respondent

Contract - Agent — Commission Agent.

Facts: The issue was whether the commission agent was entitled to commission. Evidence revealed that C.A. introduced the prospective buyers to the property but they were unable to pay the price. The buyers asked the commission agent to try and arrange a lease with option to buy but he refused and ceased contact with them. The buyers subsequently rented the property.

Held: The sale was due to the final discussions between the vendor and the purchasers. The commission agent's act of introducing the buyers to the property was important but was not the decisive factor in the sale. The commission agent was not entitled to commission. Appeal dismissed.

Lewis C.J.

1 This case concerns a claim by an estate agent for commission on the sale of a property. The facts are set out fully in the judgment which Gordon, J.A. is about to read and I shall only refer to them briefly,

2 There is no dispute about the later which i s applicable. It is well settled, and is correctly stated bar the learned trial judge in his careful judgment. The agent is entitled to his commission on the sale of a property if the relation of buyer and seller is really brought about by his act. He must introduce a ready, willing and able buyer, and his introduction must be the effective cause of or operative factor in bringing about the sale. It is the application of these principles to the facts which, as so often happens, causes difficulty,

3 in March, 1968, the respondent engaged the appellant company, through Porter, its managing director, to sell his property at McKinnon's, agreeing to pay commission, at a rate found by the trial judge to be 2 1/2% of the price, if it arranged the sale. The respondent said he wanted $80,000 to $85,000 for the property.

4 Around July 1968 Porter showed the property to a couple who subsequently married and are referred to in the case as the Wallaces. Wallace says that Porter asked U.S.$32,500; Porter is silent as to how much he asked. The Wallaces, as the judge found, made an offer of U.S.$32,000. This was conditional on their obtaining a loan to finance the purchase, and Porter approached Barclays Bank on their behalf. Porter passed on the offer to the respondent, but, as the judge found, never told him who had made it. After some days the respondent declined the offer saying that he could not accept less than $80,000. Porter told the respondent that if he was sticking to that figure the deal was off in so far as the Wallaees were concerned.

5 Later, the Wallaces contacted a lawyer, Rowan Henry, who incidentally, had also been commissioned to sell the property, and who sent them to the respondent. They rented the property as from 1st September and on 21st November 1968, after further discussions between themselves and Rowan Henry and the respondent, agreed to buy it for $80, 000. The sale was completed with the aid of a loan from Barclays Bank.

6 The learned judge held that Porter had tried to sell the property to the Wallaces but had failed to do so; and that he had not introduced the Wallaces to the respondent and thus had not brought about the relation of buyer and seller; and that in any event the appellant by calling the deal off in so far as the Wallaces were concerned had “terminated the agency” with respect to a sale to them and could not claim commission.

7 These conclusions of the learned judge have been challenged by the appellant. Learned counsel submitted that the acts done by Porter, namely, showing the property to the Wallaces and telling them the name of the owner, passing on their offer to the respondent even without telling him their names, and his approach to Barclays Bank, were sufficient to establish that the appellant; had brought about the relationship of vendor and purchaser between the respondent and the Wallaces; and that the appellant was entitled to its commission notwithstanding that the eventual sale took place without its knowledge and, so to speak, behind its back. He relied upon Green v. Bartlett l4. C.B. (N.S.) 681 and Burchell v. Gowrie and Blockhouse Collieries ltd [1910] A.C.614

8 There may be cases in which the relationship of vendor and purchaser may arise even though the agent does not disclose to his principal the name of the prospective purchaser with whom he is negotiating until the agreement to buy and sell has been reached. Whether this is so or not must depend upon the particular facts of each case. The important question to be answered is always whether those facts establish that the introduction was the operative factor in bringing about the relationship of vendor and purchaser, or, in other words, eras the effective cause of the sale.

9 In the instant case the evidence shows that Porter was firmly of opinion that the respondent could not obtain more than $65,000 for the property, and also that the Wallaces would not pay more than that sum for it. He therefore wrote them off as prospective purchasers and made no effort to obtain a beater offer from them. When they suggested that he explore the possibility of a lease with an option to buy he took no action, and it may well have been this lack of interest that caused them to go to Rowan Henry. They subsequently informed him that they had arranged with the respondent to rent the property, and they went into occupation on September 1st. Thus, at the time when the further discussions between themselves, Rowan Henry and the respondent were taking place the negotiations between Porter and themselves had ceased. The price of $80,000 which they agreed to pay was one which it...