October 17, 2011

Royds Client Christie + Co wins Court of Appeal case on Estate Agency commissions

Christie + Co the UK’s leading specialist business transfer agents has succeeded in its claim for commission following the sale of The York Hotel, Weston Super Mare, to a private purchaser introduced by Christie + Co back in May 2008.  In a Judgment handed down in the Court of Appeal yesterday, Thursday, 13th October 2011 the decision of the Bristol County Court to dismiss the claim was overruled and the commission together with costs awarded to Christie + Co.  A copy of the Judgment of the Court of Appeal is available on Court of Appeal Judgment.

Christie + Co introduced a potential buyer to the sellers, RAOBGLE Trust Corporation (“The Buffs”) during the period of its sole selling rights agency.  The Buffs terminated the agreement, however, Mr K (the prospective purchaser) maintained his interest.  His cousin, Mr P purchased the property on 12th May 2008.  At trial Mr K and Mr P both gave evidence that they had each contributed to the purchase price and that the purchase was made on behalf of a partnership.  As a result Christie + Co claimed its commission for having introduced the purchaser, Mr K who was one of the partners.  The Buffs disputed the claim on the basis that the contracting purchaser was an individual and not a partnership in which Mr K had any interest and so Christie + Co had not made the “effective introduction”.

The case came on for trial in the Bristol County Court on 11th May when the Judge drew negative inferences from what he considered a lack of supporting documentation for the evidence given by Mr K and Mr P.  He dismissed the claim.

Christie + Co went to the Court of Appeal to challenge the Judge’s findings of fact.  Appeals on fact are notoriously difficult to bring, as the higher Courts are usually reluctant to interfere with findings of fact of a trial Judge.

In a leading Judgment given by Lord Justice Rixx, the Court of Appeal held that far from there being “absolutely no evidence about a partnership” there was “a considerable amount of contemporary and documentary evidence” in support of the claim.

The Appeal was also opposed on questions of law.  Lawyers for the Buffs argued that the interpretation of “purchaser” was too wide however the Court of Appeal gave approval to the broad definition adopted in an earlier Christie + Co case Christie Owen & Davies Plc and that contrary to the submissions of the Defendant, there was evidence of the creation of the partnership consistent with the decision of the House of Lords in Khan v Miah.

The Appeal was allowed. Christie + Co awarded its commission plus interest, and the Defendants ordered to pay costs, on the indemnity basis from 14th April 2011.

Stephen Welfare, Litigation Partner at Royds commented: There are many instances where people will attempt to avoid paying commercial and residential estate agents and business transfer agents fees.  It is gratifying that in this case our client eventually succeeded where the facts showed they had and the seller had, from the outset, sought to evade the commission when in knowledge of all the facts.  I would hope that this Judgment affords some comfort and encouragement to those businesses who earn commission on a sole selling rights basis.”

Notes for editors – telephone/email contact details for Stephen Welfare:
Stephen Welfare
Email Stephen Welfare    
Direct dial telephone:  020 7842 1426
Fax:  020 7583 2034
Stephen Welfare is a partner at Royds LLP Solicitors, a long established 16 partner city law practice well known for its commercial, retail, property, employment and commercial litigation practices.  The firm also provides the BJA’s ‘Copywatch’ intellectual property service.  T: 020 7583 2222.
The information in this article refers to the law at the date the article was written and is provided for general information purposes only.  It should not be applied to specific circumstances without prior consultation with a solicitor.
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