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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Day Morris Associates v Voyce & Anor [2003] EWCA Civ 189 (26 February 2003) URL: https://www.bailii.org/ew/cases/EWCA/Civ/2003/189.html Cite as: [2003] EWCA Civ 189 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM HIS HONOUR JUDGE
HALLGARTEN Q.C
Strand, London, WC2A 2LL | ||
B e f o r e :
and
MRS JUSTICE BLACK
____________________
DAY MORRIS ASSOCIATES | Appellant | |
- and - | ||
VOYCE AND ANR | Respondent |
____________________
Smith Bernal Wordwave Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
Mr M Warwick (instructed by Messrs Alexander Marks & Co) for the Respondent
____________________
AS APPROVED BY THE COURT
Crown Copyright ©
Mrs Justice Black
The facts
"Further to our telephone conversation yesterday, we write to confirm that our applicants …will be inspecting your property this evening at 7.30. We have mentioned that the property is not on the open market yet, but we'd expect to be quoting somewhere in the region of £700-£720,000 subject to contract.
Whilst writing we would like to confirm our agreement that should they purchase your property, then our fees will be calculated at the rate of 2.5% of the sale price plus VAT."
"We write to confirm and thank you for your kind instructions to sell your above mentioned property. We note that the price we are to quote is £700,000, subject to contract."
"You will be liable to pay remuneration to us at the rate of 2.5% + VAT if at any time unconditional contracts for the sale of the property are exchanged:-
1. With a purchaser introduced by us during the period of our sole agency or with whom we had negotiations about the property during that period: OR
2. [purchaser introduced by another agent]."
"It seems to me that any attempt to reel Mrs Voyce in might have resulted in her relinquishing what seems to have been only a lightly embedded hook."
"I am not satisfied that those terms were really understood as applying".
"I do not think that [the letter of 18 July] was sent without Mrs Voyce having agreed broadly to what was set out in the first paragraph, always subject to the agents accepting the circumstance that there was a high risk that instructions would be withdrawn."
and
"the agents regarded the exercise as essentially an extension of that undertaken in late May"
and
"I believe it was always implicit that, in the event of a sale by Mrs Voyce to a purchaser introduced by the agents, commission would be payable, and whether under the 18th July letter or the 28th June letter, it matters not."
"The property had never been put formally on the market and she had never signed any contract. To some extent it was tentative, in the hope of getting the business."
"as to the question of whether Mr Claydon was telling the truth, the answer, I think, is that he was probably telling a half-truth. He was in a difficult position, and it seems to me that he was embarrassed by the situation, with a witness summons hanging over his head, and thus was anxious to play down the role that the claimant had been conducting."
The grounds of appeal
The procedural complaint
The substantive ground
(a) He did not consider that a contract had been formed on the terms set out in the letter of 18th July 2000.
(b) However, it was implicit that in the event of a sale to a purchaser introduced by the agents, commission would be payable.
(c) This state of affairs may have arisen either from the 28th June letter or the 18th July letter: he did not think it mattered which.
(d) It was subject to the proviso that the sale that would trigger the commission was a sale "by" Mrs Voyce. By this, the Judge meant that the sale was "within Mrs Voyce's power" and one in relation to which she had a choice.
"In my view, commission could only be attracted in relation to a sale in which the claimant [there is some doubt as to whether the Judge may in fact have meant to say Mrs Voyce rather than the claimant here but this is far from clear] retained a genuine involvement. In my view, once the 30th October court order was agreed, there was no longer a relevant causative connection between the claimant's introduction and Mr Voyce's sale to Miss Lee. The choice of the purchaser was entirely out of Mrs Voyce's hands. As a matter of analysis, it seems to me that the position is not really different from what would have been the case had Mr Voyce sold to X at arm's length and X had within a short period resold to Miss Lee. That is an obvious example of the causative link being broken and, in my view, that extreme example illustrates the true position here; namely, that there can be no claim for commission in relation to a sale to a purchaser when Mrs Voyce was left with no choice in the matter at all."
"I decide the matter against the agents on the narrow ground that at the time that the sale was effected, it was something which was no longer within Mrs Voyce's power; the choice of purchaser was entirely Mr Voyce's."
Contract on terms of 18 July letter?
a) against the background of the dealings that there had been between Mrs Voyce and the agents prior to the letter being sent
and
b) in the light of the precise nature of the terms that were being offered.
i) It was an unusual feature that the agents were dealing with only one of two joint owners of the property and were doing so in the context of divorce proceedings.
ii) It was understood that Mrs Voyce was undecided about whether to sell the property or whether her husband would buy her out, and it was the agents' suggestion that until she decided she could invite potential purchasers to view on the basis that it might come on to the market in due course.
iii) Mrs Voyce was still undecided about what would happen to the property at the time the 18th July letter was sent as can be seen from the Judge's finding that even at the beginning of September 2000 there was no question of there being a final decision to sell.
iv) The agents were deliberately keeping things fluid for fear of frightening Mrs Voyce off.
v) On the other hand, although the Judge was not satisfied that the terms of the July letter were "really understood as applying", he concluded that things changed between the introduction of the couple at the end of June on the terms of the letter of 28th June and the 18th July with Mrs Voyce agreeing a marketing decision with Mr Day which went beyond that one-off introduction. Further, he concluded that she must have given instructions to sell the property as recorded in the first paragraph of the 18th July letter.
i) It seems to me that part of the difficulty in this case has arisen from the considerable debate that there was over whether the property was or was not "formally" on the market and whether the agents were "formally instructed". These terms do not in themselves tell one anything about the contractual arrangement between the parties although they may, I suppose, contain a pointer towards its possible elements. As the Judge observed, the fact that a property has only been on the market "informally" does not mean that there will not be commission to pay if a sale eventuates. Whether there is or is not depends on the terms actually agreed between the agent and the client. Mr Claydon saying that the property had never formally been put on the market did not therefore reveal a lot, if anything, about the agents' view of the terms of their engagement.
ii) It seems to me that Mr Charlton QC's analysis of the ambiguous passage of the judgment in which the Judge deals with Mr Claydon's comments is correct. The Judge (who appears to have heard oral evidence from Mr Claydon) seems not to have seen Mr Claydon's comments to Mr Rutter as a wholly accurate description of how the agents saw the position between themselves and Mrs Voyce. He thought that Mr Claydon told only a half truth to Mr Rutter about the arrangements in relation to the property because he was anxious to play down the role the agents had been conducting. On that finding, the note is in no way fatal to the agents' case that a contract had been made on the 18th July letter. Equally, I do not consider that the Judge's later finding that what Mr Claydon said revealed that the agents regarded the exercise as essentially an extension of that undertaken in late May (by which he must have meant late June) presented an obstacle either when it is recalled that the Judge also found that the 18th July letter simply spelled out in slightly greater detail what was already set out in the agents' letter of 28th June, .
iii) There was another piece of evidence, contained in a letter written on 14th September 2000 by Mr Meek of Day Morris to Mr Rutter which was material to the issue of how the agents themselves saw things. Mr Meek was writing in connection with a request that he value the property for the ancillary relief proceedings. He had been asked about a valuation fee and said in his letter: "We would only charge [a] fee should our agency instructions be withdrawn without a commission being realised by us.". The Judge accepted that Mr Meek was giving a truthful account so far as he could and it therefore follows that Mr Meek, at least, saw his firm as having agency instructions.
The alternative submissions
Lord Justice Sedley :
Order: Appeal allowed.
Judge's order to be set aside and substituted for a judgment debt of £17,000 plus VAT as claimant's estate agents fees (total of £19,975.00).
Counsel to provide agreed minute of order.
Leave to appeal to the House of Lords refused.
(Order does not form part of the approve judgment)