Estate agent – Commission – Sole agency agreement – Claim for commission dismissed on ground that appellant estate agent not the party who introduced purchaser to respondent seller – Appellant advancing alternative claim for same sum in damages for breach of contract consisting of instructing other agent during sole agency period – Whether breach causing appellant to lose chance of selling property – Appeal allowed
In 2006, the respondent instructed a number of estate agents to market a residential property for sale. In November 2006, she decided to instruct the appellant firm. Following discussions between the parties, the appellant sent an email to the respondent purporting to confirm the arrangements agreed between them. The email stated that the appellant would act on a multiple agency basis until the end of 2006, after which it would have sole selling rights. Copies of the appellant’s standard sole agency agreement and multiple agency agreement were attached. The sole agency agreement stated that the respondent was not to market the property for sale privately, or instruct any other agent to market or sell it, during the agency period. It further provided that the respondent would be liable to pay remuneration to the appellant if, at any time, contracts were exchanged on a sale to a purchaser introduced to the property in any way during the agency period. The specified remuneration was a commission of 1.95% of the sale price, plus VAT. The respondent replied to that email in positive terms.
In the event, the respondent continued to instruct another agent after 2006. In January 2007, the eventual purchaser attempted to telephone the appellant regarding the property but, finding the line engaged, left a message and contacted the other agent instead. The appellant attempted to return the purchaser’s call but found the line engaged. The sale was ultimately concluded through the other agent.
The appellant’s claim to recover £10,883 in commission, under the terms of the sole agency agreement, was dismissed in the court below. The deputy district judge found that the email exchange between the parties had resulted in the conclusion of a contract in the terms proposed by the appellant but that, on the authority of Foxtons Ltd v Bicknell [2008] EWCA Civ 419; [2008] 17 EG 163 (CS), the appellant was not entitled to commission since it was not the party who had introduced the purchaser to the purchase. On appeal from that decision, the appellant pursued its alternative claim for damages for breach of contract arising out of the continued appointment of the other agent.
Held: The appeal was allowed.
(1) The two agency agreements attached to the appellant’s email had clearly been put forward not as alternatives but as consecutive arrangements; the text of the email had made that plain. Given the terms of the respondent’s reply, the deputy district judge had been entitled to find that a contract had been made in the terms of that email exchange. It followed that the appellant had had a sole agency.
(2) Once the appellant’s claim for commission had been dismissed, the court below ought to have dealt with its alternative claim for damages for breach of contract. Such a claim was not precluded by the decision in Foxtons. During the period for which the appellant had sole selling rights, it was to be the only party marketing the property. The continued instruction of another agent was a breach of the term that no other agent should be instructed. Given that the appellant had tried to respond to the eventual purchaser’s call by telephoning back immediately, on a balance of probabilities it would have had a chance of selling the property itself but for the respondent’s breach of contract. On the balance of probabilities, that breach had caused the loss of the chance for the appellant to sell the property.
(3) The chance that had been lost was not purely speculative but was a real and substantial chance that had been lost by reason of the breach, given the evidence that the purchaser had been unwaveringly attracted to the property from the point of being introduced to it up until the conclusion of the sale. There was no information on which the court could find that the purchaser’s affection for the property would have been diminished simply by virtue of the appellant’s involvement. Consequently, this was a certain chance and no discount should be afforded for the imponderables involved in any case involving the assessment of chances. The appellant had lost the chance of earning the whole of its commission and was entitled to damages of £10.883.
The parties appeared in person.
