Cases - Christie Owen & Davies plc v King

Record details

Name

Christie Owen & Davies plc v King

Date

[1998]

Citation

SCLR 786

Keywords

Estate agency - commission

Summary

This is a Scottish case heard in the Court of Session. The agent incorporated the Scottish version of the statutory explanation of the sole selling rights. This is the same as the English with the substitution of the words 'missives ... concluded' for 'contracts ... exchanged' in accordance with the Scottish practice of conveyancing. The relevant clause in the contract of agency was:

'... if unconditional missives for the sale of the property are concluded after the expiry of the period during which we have sole selling rights but to a purchaser who was introduced to you during that period or with whom we had negotiations about the property during that period.'

The vendor (defender) placed a nursing home in the hands of the agent (pursuer) on sole selling rights terms in accordance with the statutory explanation. After 9 months, the vendor terminated the contract of agency. He then sold the nursing home to a company run by 2 men, both of whom had received details of the home from the agent. One of the men had telephoned the vendor soon after he had terminated the agency contract to ask if the property was still on the market. The vendor had not previously known of this man's existence. The agent claimed commission for the sale.

One of the issues in the case was whether the eventual purchaser had been 'introduced to you' during the period of the agency contract. The vendor claimed no such introduction was made. The Court of Session dismissed this pedantic approach. The court observed that the cases (on effective cause) had clearly established that actual introduction of the purchaser to the seller is not necessary. The important thing is that the parties were put together in a business relationship. It was therefore held that a purchaser is within the clause:

'... if it is established that he was introduced to the property or brought into a relationship with it through the actings of the agent. We do not consider that any personal introduction to the defender is required.'

The court observed that, if they were to hold otherwise, an unscrupulous vendor could take unfair advantage where a potential purchaser, having been sent details by the agent, contacts the vendor directly. In such a case, the vendor could terminate the agency then complete the sale. 'The commercial purpose of a clause of this type is to take account of such a temptation and the consequent need for vigilance on the part of the agents.'