Coolangatta Property Pty Ltd t/as LJ Hooker Murwillumbah v Emily Dyason [2011] NSWSC 884

Supreme Court New South Wales

Medium Neutral Citation: Coolangatta Property Pty Ltd t/as LJ Hooker Murwillumbah v Emily Dyason [2011] NSWSC 884 Hearing dates: 15 August 2011 Decision date: 15 August 2011 Before: Ball J Decision: 1.Judgment in the sum of $12,375 plus interest. 2.The defendant pay the plaintiff's costs of the proceedings. Catchwords: AGENCY - real estate agent - whether entitled to commission - whether statement of claim for commission served - whether "introduced" for purposes of agency - held in favour of agent Legislation Cited: Property, Stock and Business Agents Act 2002 Cases Cited: Big Brother Movement Ltd v Richard Stanton and Sons Pty Ltd [1989] ANZ ConvR 153 Oades v Ewart [1961] NSWR 45 Category: Principal judgment Parties: Coolangatta Property Pty Ltd t/as LJ Hooker Murwillumbah (Plaintiff) Emily Dyason (Defendant) Representation: H Altan (Plaintiff) No Appearance (Defendant) S+P Lawyers (Plaintiff) No Appearance (Defendant) File Number(s): 2010/37720

EX TEMPORE Judgment 1In these proceedings the plaintiff, Coolangatta Property, a real estate agent, seeks to recover commission of $12,375 in relation to the sale of a property owned by the defendant, Ms Dyason, in Tumbulgum, in northern New South Wales. The proceedings were originally commenced in the Local Court but were transferred to this court because objection was taken to the Local Court's jurisdiction on the basis that Ms Dyason lives overseas. Subsequently, on 23 July 2010, an order for substituted service on Ms Dyason was made by this court. 2On 25 October 2010, the solicitors for Ms Dyason filed a defence, although subsequently, on 4 April 2011, those solicitors filed a Notice of Intention to Cease Acting. Since that time, Ms Dyason has been represented in these proceedings by her father, Mr Dyason. Mr Dyason did appear today, However, when I indicated to him that, if the court were to give permission for him to act for his daughter, the court had power to make an order against him personally in relation to costs, he withdrew. In those circumstances, the plaintiff proceeded on an ex parte basis. 3Ms Dyason entered into an Exclusive Agency Agreement with Coolangatta Property on or about 5 September 2008 for the sale of her property. Clause 1 of that agreement provides: In consideration of the Agent promising to use their best endeavours to sell the subject Property, the Principal hereby grants to the Agent exclusive selling rights of the Property for a period from 1/9/2008 to 31/1/2009 inclusive now called the "Exclusive Agency Period". Clause 3.i provides: The Exclusive Agent shall be entitled to a fee of 3.3% (GST incl.) if during the Exclusive Agency Period the Property is sold either: (a) by the Agent; (b) by any other agent; or (c) by the Principal. Clause 3.ii provides: The Agent shall be entitled to a fee at the agreed amount if at any time following the expiration of the Exclusive Agency Period the Principal enters into a Contract for the Sale of the Property to a purchaser effectively introduced to the Principal or the Property during the Exclusive Agency Period by the Agent, by any other agent or by the Principal. Clause 3.vi provides: The fee to which the Agent is entitled should be due and payable on completion of the sale or upon demand if the sale is not completed owing to the default of the Principal after the parties have entered into a binding contract or if after the making of the contract the Principal and the purchaser mutually agree not to proceed with the contract. 4Ms Dyason's father objected to Ms Dyason selling the property. It appears that he had contributed to the mortgage payments and took the view that Ms Dyason should retain the property for her daughter. However, Mr Dyason was unsuccessful in persuading his daughter not to proceed with the sale and, on 13 January 2009, a company controlled by him and known as IIB Australia Pty Ltd made an offer through Coolangatta Property to purchase the property for $375,000. Ms Dyason accepted that offer and her acceptance was communicated to Mr Dyason on 15 January 2009. IIB paid a deposit of $37,500 at about that time and contracts were exchanged on 12 February 2009. 5Subsequently, on 20 February 2009, Coolangatta Property was advised that the sale was withdrawn. That happened as a result of an agreement reached by Ms Dyason and her father. Ms Dyason informed Coolangatta Property in her email dated 20 February 2009 that in withdrawing the property for sale the costs would be paid by her father. Subsequently, on 25 February 2009, IIB and Ms Dyason entered into a deed by which each of them agreed to release the other from their obligations arising under the contract that they had exchanged. 6In the defence filed on behalf of Ms Dyason three issues are raised. The first is that the plaintiff has not served a statement of claim in compliance with s 36 of the Property, Stock and Business Agents Act 2002. Subsection 36(1) provides: An action or other proceedings cannot be commenced by a licensee for the recovery of remuneration or any sum as reimbursement for expenses until the expiration of 28 days after a statement of claim has been served personally or by post on the person to be charged with the remuneration or expenses. Subsection 36(2) provides: The statement of claim must be in writing, set out the amount claimed and contain details of the services performed by the licensee in respect of which the remuneration or expenses are claimed. 7In Oades v Ewart [1961] NSWR 45 Owen J, when dealing with the predecessor of s 36, which was in similar terms, said at 47: What details are necessary to be set out in any particular case must depend upon the nature of the transaction. His Honour then went on to say: In a case such as the present, I am of opinion that a statement of claim sufficiently details the services performed in respect of which an estate agent claims commission if it identifies the property sold, the vendor and purchaser of the property, the price, and shows how the amount which he claims as commission is made up, namely, by stating the percentage which he charged on the amount of the sale price. He is not required to render something in the nature of a bill of costs setting out his attendances on buyers, his telephone calls, letters and the like because, his right to commission depends upon the fact that he has effected the sale. That is the service which he performs and for which he is entitled to be paid. 8In this case, Coolangatta Property provided Ms Dyason with an invoice describing the relevant property and the claim for commission. It is true that that invoice does not set out the percentage rate at which commission is claimed. However, in circumstances where that rate is clearly set out in the contract, I think that the invoice that was provided to Ms Dyason is sufficient to comply with s 36. 9The second issue raised by the defence filed on behalf of Ms Dyason is that IIB was not "effectively introduced" to Ms Dyason as required by cl 3.ii of the agency agreement. I do not accept that defence. The expression "effectively introduced" in this context means presenting or bringing forth IIB as an entity that might complete the purchase. That was the view taken by Mahoney JA in Big Brother Movement Ltd v Richard Stanton and Sons Pty Ltd [1989] ANZ ConvR 153 at 156-157 in relation to the expression "introducing" in a similar contract. That conclusion is supported by the wording of cl 3.ii which makes it clear that the clause applies even if the purchaser is introduced to the principal or to the property by the principal. 10When read together the clear intent of cls 3.i and 3.ii is that, if the property is sold during the exclusive agency period or if it is sold to someone who was presented by the agent as a potential purchaser during the exclusivity period, then the agent is entitled to its commission. That is what happened in this case. IIB was presented by Coolangatta Property to Ms Dyason as someone who was willing to buy the property within the exclusive agency period. In fact, IIB paid a deposit within that time, although contracts were not exchanged until after the expiration of the exclusive agency period. 11In my opinion that is precisely the type of situation to which cl 3.ii is directed. There can be no question that Coolangatta Property would be entitled to a commission under cl 3.i if exchange had occurred within the exclusive agency period. One of the things cl 3.ii is designed to ensure is that the same result follows if exchange occurs after that period has expired. It seems clear that the clause was designed, among other things, to guard against the possibility that the purchaser and the vendor might collude to defeat the agent's right to a commission by exchanging contracts after the exclusive agency period expired. 12The third issue raised by the defence filed on behalf of Ms Dyason is that the commission is not payable because there was no completed sale. In my opinion, however, cl 3.vi is clear. It provides for the payment of commission where the principal and the purchaser mutually agree not to proceed with the contract. That is what happened in this case. 13It follows from what I have said that none of the defences raised in the defence are made out. In those circumstances, the plaintiff should have judgment for the $12,375, plus interest on that amount calculated from 28 March 2009 to 15 August 2011. The defendant should also pay the plaintiff's costs of the proceedings.