Boss Partners Estate Agents Pty Ltd - v - Rivacourt Pty Ltd
[2012] VCC 1884
•18 December 2012
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted |
AT MELBOURNE
CIVIL DIVISION
COMMERCIAL LIST
GENERAL DIVISION
Case No. CI-11-04972
| BOSS PARTNERS ESTATE AGENTS PTY LTD (ACN 057 852 990) AS TRUSTEE FOR THE JAARON UNIT TRUST T/AS BARRY PLANT (IVANHOE) & ANOR ACCORDING TO ATTACHED SCHEDULE | Plaintiffs |
| v | |
| RIVACOURT PTY LTD (ACN 115 073 982) | Defendant |
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JUDGE: | Her Honour Judge Kennedy | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 5, 6 and 7 December 2012 | |
DATE OF JUDGMENT: | 18 December 2012 | |
CASE MAY BE CITED AS: | Boss Partners Estate Agents Pty Ltd – v – Rivacourt Pty Ltd | |
MEDIUM NEUTRAL CITATION: | [2012] VCC 1884 | |
REASONS FOR JUDGMENT
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Catchwords: Commercial – claim by real estate agent for outstanding commissions pursuant to 2007 and 2008 written authorities – whether statement made that commissions would not be enforced such as to ground an estoppel defence and/or misleading and deceptive conduct under s52 of the Trade Practices Act 1974 (Cth) – whether the first plaintiff was entitled to the commissions sought – whether variation effected to the terms of the authorities
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr C. Truong Mr D. Yarrow | Macpherson + Kelley Lawyers |
| For the Defendant | Ms K. Foley | Keith Cameron |
HER HONOUR:
1 The plaintiffs claim outstanding commissions of $138,600 plus interest against the defendant for the sales of 6 lots located at 30-70 Seymour Road Viewbank pursuant to a general authority executed in 2007 and an exclusive authority executed in 2008.[1]
[1] An earlier claim based on quantum meruit was abandoned at trial.
2 The primary case was that it was the first plaintiff, Boss Partners Estate Agents Pty Ltd (“Boss”), who was entitled to the commissions.
3 The defendant says that the first plaintiff should be estopped from claiming the commissions on the basis of statements made on 17 August 2010, to the effect that it would not enforce entitlements under the 2007 and 2008 authorities. The defendant further counter claims for orders refusing to enforce the authorities and for damages of $29,750 on the basis that the statements were misleading and deceptive under s52 of the Trade Practices Act 1974 (Cth) (“TPA”).
4 The defendant further says that the firstnamed plaintiff, Boss, has not established that it is the entity entitled to the commissions pursuant to the authorities. Further, that it has not established an entitlement in the capacity in which it sues, namely, as trustee of the Jaaron Unit Trust.
5 The defendant also claims that any quantum should be reduced because there was a subsequent agreement to pay a reduced commission of 1.5% commission for selling Lots 3 and 6. Otherwise the quantum was generally accepted.[2]
[2] Save for a submission about GST raised if the defendant was successful on the variation claim: See Defendant’s note concerning reduction of claim (calculation).
6 There are therefore three main issues, namely:
a. whether any estoppel and/or claim under s 52 of the TPA is established on the basis of what occurred on 17 August, 2010;
b. whether quantum should be reduced by reason of a variation as alleged;
c. whether the first plaintiff is entitled to the commissions sought.
Background
1 Boss is the holder of an estate agent’s licence under the Estate Agents Act 1980 (Vic).
2 A director of Boss, Mr Aaron Silluzio, was the main witness for the plaintiffs.
3 Rivacourt was the registered proprietor of 6 lots of land at 30-70 Seymour Road in Viewbank.
4 The director of Rivacourt was Mr Ian Hall, who was the only witness called for the defendant.
The 2007 Authority
5 On 2 March 2007, Rivacourt executed a General Sale Authority in relation to the lots.
6 The 2007 Authority provided that the agent would be entitled to commission of 2% of the purchase price where that agent was the effective cause of the sale.
7 The evidence of Mr Silluzio was that he procured a number of sales pursuant to the 2007 Authority (which involved a large amount of work) as follows:
· On 19 March 2007, in relation to lot 5 (for $1,250,000);
· On 26 March 2007, in relation to lot 2 (for $1,200,000);
· On 25 October 2007, in relation to lot 4 (for $1,230,000); and
· On 27 October 2007, in relation to lot 1 (for $1,250,000).
8 A number of these contracts were subsequently rescinded by the purchasers pursuant to a “sunset clause” as follows:
· 12 August 2008, the purchaser of lot 5 rescinded the contract of sale;
· On 27 April 2009, the purchaser of lot 4 rescinded the contract of Sale;
· On 10 March 2010 the purchaser of lot 1 rescinded the contract of Sale.
9 However, the defendant does not take issue with the first plaintiff’s entitlement on this basis.
10 On or about 19 December 2007, the 2007 Authority was terminated. The evidence of Mr Hall was that he had issues with a Mr Gil Williams, his agent at the time, who had arranged the 2007 Authority such that he needed to look at terminating that authority.
11 In any event, none of the commissions referable to the 2007 Authority have been paid.
The 2008 Authority
12 On 29 October 2008, Rivacourt executed an exclusive sale authority in relation to Lots 3, 5 and 6. Again, the written terms provided for a 2% commission.
13 The evidence of Mr Silluzio was that he then procured further contracts of sale (which lots were difficult to sell) as follows:
· A contract of sale was executed on 16 December 2008 in relation to Lot 3 (for $1,100,000);
· A contract of sale was executed on 16 December 2008 in relation to Lot 6 (for $900,000); and
· A contract of sale was executed on 20 February 2009 in relation to Lot 5 (for $1,150,000).
14 Rivacourt paid 2% commission to Boss in relation to the sale of Lot 5, but has not otherwise paid the commissions referable to the 2008 Authority.
The 2010 Authority
15 On 9 August 2010, Mr Hall and Mr Silluzio had a telephone conversation. There is a dispute, however, about what was said which will be resolved, below.
16 On 13 August 2010, Rivacourt (as vendor) rescinded the contracts of sale for each of Lots 2, 3 and 6.
17 Then on 17 August 2007, there was a meeting between Mr Hall and Mr Silluzio. There is, again, a dispute about what was said at the meeting (as will also be discussed below).
18 There is no dispute that the 2010 Authority was signed at that meeting. Again, it provided for 2% commission and purported to be given in relation to all of the lots (although lot 5 had already been sold in circumstances where the vendor was not entitled to rescind).
19 Five further sales were then procured by Boss pursuant to the 2010 Authority as follows:
· lot 4, sold on 24 August 2010 for $1,350,000;
· lot 2, sold on 28 August 2010 for $1,300,000;
· lot 6, sold on 6 October 2010 for $920,000;
· lot 1, sold on 12 November 2010 for $1,150,000; and
· lot 3, sold on 8 April 2011 for $1,230,000.
20 In relation to each of these sales, Rivacourt paid commission of 2%.
21 Following the last sale (in April 2011), on 13 May 2011 the first plaintiff issued invoices to Rivacourt’s solicitor, Keith Cameron, in relation to the sales effected under the 2007 and 2008 authorities.
22 By correspondence of 16 May 2011 Keith Cameron denied liability stating that at no time had Rivacourt dealt with Boss Partners Real Estate Agents Pty Ltd in its capacity as trustee of the Jaaron Unit Trust.
23 On 26 May 2011, Boss then issued another set of invoices, (this time including a different ABN number).
24 The invoices remain unpaid.
25 This proceeding was then issued in about October, 2011.
Witnesses
26 As indicated already, the main witness for the plaintiffs was Mr Silluzio. Other witnesses were Dr Con Perkoulidis ( a purchaser of lot 3) and Mr Cammarano (the accountant for the plaintiffs).
27 The only witness for the defendant was Mr Hall.
28 The defendant made various criticisms of the evidence of Mr Silluzio, suggesting that he had a tendency to exaggerate, and criticising, in particular, his evidence surrounding the execution of a sale of business contract and the events of 17 August.
29 His evidence about events of 17 August will be considered further, below.
30 In terms of the sale of business contract, this document related to the sale of the Barry Plant (Ivanhoe) real estate business, and will be referred to further, below. The evidence of Mr Silluzio was somewhat confused as to the precise capacity of each of the signatories to this document. However, I accept his explanation that his accountants were generally charged with organising his business affairs. Although this was less than satisfactory, it did not otherwise detract from his credit on significant matters.
31 I also accept that he had a tendency to be emotive at times in the giving of his evidence, suggesting, for example, that he was “bashed” by purchasers after the vendor rescinded. However, there is some objective evidence supporting that purchasers expressed negative feelings. Thus, in a contemporaneous email of 18 October 2010 Mr Silluzio described a “lengthy chat” with the wife of a purchaser who was at first “very aggressive.” The evidence of Dr Perkoulidis was also that he issued court action consequent on receiving the rescission notice (though this proceeding was later withdrawn).
32 I generally found Mr Silluzio to be a tenacious, honest and straightforward witness. His evidence on crucial events in August was also both credible and probable.
33 By way of contrast, I did not find Mr Hall to be an impressive witness. Having had an opportunity to observe his demeanour, he sought to give answers that assisted the defendant’s case, rather than responsive answers based on genuine recollection. He was also reluctant to make appropriate concessions.
34 His evidence about his financial position was also unsatisfactory. Thus, he suggested that there was “no assistance at all” if someone held off demands for a commission until after the last sale. He also sought to generally downplay the financial impact of the delayed project and, even under re-examination, was unable to give a responsive answer to a question as to why he said Rivacourt’s loss was not a financial burden.
35 This was despite the fact that in a more contemporaneous email of 7 June, 2010, to David Oster of Jellis Craig, he stated that due to the delays he had “encountered substantial additional costs which I will need to recoup (emphasis added).”
36 In this context, I consider that his unsubstantiated suggestion under re-examination that he had about $10 million at his “disposal” to spend for “different projects” should also be treated with considerable caution.
37 Mr Hall also sought to understate his experience as a businessman. Thus, when it was put to him that he was an experienced businessman he said this was his “first” subdivision. When he was asked “[w]hat else have you done?”, he again said this was the “first” time he had ventured into this sort of thing. When he was again pressed that he was commercially experienced, he replied in a non-responsive: “Yes and no. At the end of the day, I was good at what I did and people did the best for me, but at the end of the day I just did what I did.”
38 Although this may have been his “first” project, such evidence appears to be less than direct, given his own evidence that he had problems with his associate Mr Williams with “another project” prior to November 2007; he also made reference to having $10 million to spend “for different projects” in re-examination.
39 I therefore generally preferred the evidence of Mr Silluzio where that evidence conflicted with Mr Hall.
Estoppel/s52 TPA
40 In order to resolve whether any estoppel/misleading conduct is established, it is necessary to make factual findings about what transpired at the meeting of 17 August 2010, and also in a telephone conversation leading up to that meeting on 9 August 2010.
Factual Findings
Evidence of Mr Hall
41 In relation to the conversation of 9 August Mr Hall gave oral evidence that he:
… called [Aaron] on the 9th and I said to Aaron, "I'm going to rescind contracts 2, 3 and 6. The market has moved and the price needs to be realigned to that price." He turned around and said to me that he was confident of getting the higher price and he also was confident that three of those purchasers would re‑sign again for those lots. He then said to me that he wanted 2 per cent for all the lots. I didn't confirm at that time and I said ‑ that was it. Well, the other bit I said in the conversation was that I needed to produce a new section 32 because the old ones were two years old and I had to get a new one.
42 In relation to the meeting of 17 August, his evidence was that they started going through each of the lots and purchasers and whether they were keen or not:
Then Aaron turned around and said to me, "Pursuant to the original sale contracts, I could claim commission for those that had been cancelled or rescinded." With that, I laughed because I thought he was joking and I did say to him, "You are joking," and then ‑ ‑ ‑
If I can stop you there, why did you say that to him?---It was the first time it had ever been raised about commission, the very first time.
43 He claimed that Mr Silluzio expressed his frustration about having sold lots and then having them cancelled on him. Mr Hall suggested that there was not much extra work and Mr Silluzio said he wanted 2% for all sales instead of 1.5 for the two and Mr Hall agreed.
44 The reference to the “1.5% for the two” was a reference to what Mr Hall said was an earlier agreement to the effect that Mr Silluzio would only be entitled to 1.5% on sales of lots 3 and 6 (this evidence will be referred to further, below)
45 Mr Hall’s evidence was then:
I said, “You can have 2 per cent for all the sales." I went on to say ‑ this is where I said, "The past is the past, Aaron. We need to move forward and I want to enter into a new agreement with yourself with respect to commission," and that is in respect of all sales, in consideration of all sales, for commission of Barry Plant.
What did Aaron say in response to that? - A little bit more ‑ I said a bit more and I said, "Aaron, you are going to gain that extra 2 per cent, you are going to get the extra half per cent and also going to gain the higher site prices." He acknowledged and said, "Yes," and, "Okay." At that point he drew up the sale authority there and then and that's where I signed it there and then too. That's the agreement that we went forward.
46 On the basis of the discussion with Mr Silluzio, Mr Hall said that he understood that the sales were “going forward” with no commission on the rescinded sales.
47 If Mr Silluzio had said he still wanted the earlier commissions he also claimed that he would not have entered the contract.
48 Under cross examination he maintained that he had told Mr Silluzio he was going to rescind lots 2, 3, and 6 in the telephone conversation of 9 August. He also denied that Mr Silluzio had told him that he would have to pay for past commissions.
Evidence of Mr Silluzio
Meeting of 9 August
49 In relation to the conversation of 9 August, Mr Silluzio’s evidence was as follows:
Mr Hall had contacted me to say that there was an issue with the s.32s of the lots that we had sold and that he had to cancel the contracts in order to draft up new contracts. I said to him on the telephone, I said, "You're not going to cancel these contracts so you can try and sell them for a higher price, are you?" He said, "No, I'd never do that. There's no way I would do that. It is merely just so we can update the s.32s."
50 In relation to the meeting of 17 August, Mr Silluzio gave oral evidence that:
He explained to me, he said, "Look, I've got to come clean. I'm going to be rescinding the contract so that we can resell them." I said, "Why would you want to do that? These people have been waiting for 18 months. These are other people's lives you're dealing with." He said, "Yeah, but the market's changed, I can make more money out of this and you couldn’t (sic) benefit from it as well." I said, "Look, I'm not interested in benefiting from anything. What I want to do is I want you to settle the blocks that you've said you were going to sell to these people and I want to move on. We've got two blocks to deal with, let's deal with those blocks." He said, "No, that's not going to happen. They've been rescinded. We need to get together and we need to discuss ‑ we need to come to agreement on a price for resale value." I could clearly see he wasn't going to honour his contract with the purchasers, so I gave him my advice as to where I thought the blocks could sell for. There was a discussion with regards to the previous commissions that were due and payable to our company for the previous sales and he asked if we could pay them at the end still and I said I'd be happy to do that (emphasis added).
51 In relation to the reference to “paying at the end”, the evidence of Mr Silluzio was that there had also been an earlier discussion about deferral of commission on rescinded sales when they were signing up the second authority in October, 2008 at which time the contract for lot 5 had been rescinded. Mr Hall told him there were financial issues because the project had gone on so long, such that they agreed the commission would be taken out once properties were sold.
52 Mr Silluzio’s evidence was that on 17 August, Mr Hall said that he had been speaking with another agent at Jellis Craig, Mr Oster, who had offered 1.5%. Mr Silluzio suggested that he was most welcome to go with Mr Oster as he did not want to deal with him anymore and he was happy to do it at 2% or not do the deal at all. However, he reminded Mr Hall of the relationship he had with the buyers and his knowledge of the properties such that if anyone would be able to resell at a higher price he may be able to. They then agreed that it was worthwhile paying Mr Silluzio another 0.5% more than Mr Oster, because Mr Hall could see the value.
53 Mr Silluzio said that they then signed the authority and Mr Hall agreed to pay 2%. He reiterated that the discussion about the previous sales was that Mr Hall would pay them at the end.
54 Under cross examination Mr Silluzio denied that Mr Hall told him he had decided to cancel the contracts in the 9 August conversation and denied also that he raised the question of commission since it was company policy not to discuss commission over the telephone.
55 In relation to the meeting on 17 August, he accepted that they both said “we’ve got to come to an agreement on the commission moving forward.” However, what they were discussing “moving forward” was the sale of the lots again commission-wise at 1.5% or 2%, with Mr Hall using Mr Oster as a negotiation tool to try and get the commission for 1.5%. However, it had nothing to do with the previous sales.
56 When it was put to him that they reached agreement that he would get 2% instead of 1.5% in return for which he would not press for earlier commissions, he firmly replied: “Why would I do that? No.”
Findings of fact
57 Before resolving the factual dispute about events in August, 2010, it is appropriate to resolve the conflict about the alleged agreement to reduce the commission to 1.5% in respect of 2 of the lots.
Evidence about alleged agreement at 1.5%
58 It will be recalled that the evidence of Mr Hall was that an agreement had been reached to the effect that Mr Silluzio would only be entitled to 1.5% on sales of lots 3 and 6. This occurred in November, 2007 when they were the only lots remaining to be sold.
59 By way of contrast, the evidence of Mr Silluzio was that in November, 2007 there had been an agreement reached for remaining lots 3 and 6 such that if they were sold at less than the asking price the commission would be 1.5%; otherwise commission would be 2% as per the written authority.
60 There are a chain of emails in relation to this matter.
61 First, there was an email from Mr Silluzio dated 19 November 2007 which said the following:
Hi Ian,
As discussed we will reduce the commission to 1.5%+GST if we sell the remaining 2 properties for less than the asking price. Should we sell the properties for the full asking price or more, then the commission remains the same as with the previous blocks sold.
Please let me know when you would like to meet up to sign an exclusive authority with our company (emphasis added).
62 In an email dated 6 November 2008 (some 12 months later) of 12.17 pm Mr Hall wrote to Mr Silluzio attaching the November 2007 email and stating that “[t]his needs to be reflected in the exclusive authority instead of the 2%.”
63 At 12.32 pm on 6 November, Mr Silluzio indicated that he was happy with this and Mr Hall wrote saying this was “fine and fair” at 12.41 pm the same day.
64 Then at 12.58 pm Mr Silluzio says he was happy for Mr Hall to write this on the contract, though Mr Hall then responds (at 1.02 pm) saying there is no need “I trust you.”
65 It would have been expected that Mr Hall would have challenged the version of the agreement presented by Mr Silluzio in the November 2007 email if the agreement was as he now says. Instead, he has simply forwarded it on, implicitly acknowledging its accuracy and completeness.
66 The contemporaneous objective evidence therefore supports the evidence of Mr Silluzio that the agreement was to reduce commission to 1.5% on lots 3 and 6 only if they were sold for less than the asking price. His unchallenged evidence was also that the two lots sold for more than the asking price such that the variation was inapplicable.
67 I therefore do not accept Mr Hall’s evidence that they had actually agreed to a change to 1.5% regardless of whether the lots were sold for the asking price.
68 It follows that I reject the defendant’s submission that the quantum should be reduced in the case of lots 3 and 6.
69 The email chain, however, is also significant in another respect. Thus, although Mr Hall was content to rely on the written emails rather than requiring a formal amendment, the chain suggests that Mr Hall was perfectly capable of bringing a change to the attention of Mr Silluzio, in writing, when he wished, even after a delay of a year.
August 2010
70 The evidence of Mr Silluzio about events of August, 2010 was consistent, credible and probable.
71 The defendant highlighted, in particular:
· that Mr Silluzio changed his evidence about “moving forward”;
· that the absence of writing was consistent with previous dealings wherein Mr Silluzio had acted without a written authority in 2008.
72 However, I do not accept that Mr Silluzio “changed” his evidence about “moving forward.”
73 Initially under cross examination he agreed that they had both said they had to come to an agreement on the commission “moving forward”. However he rejected saying “the past is the past” because he always wanted the commission due and payable for the previous sales which he had “worked [his] backside off” to sell the first time around.
74 It was true that he was later reluctant to acknowledge his evidence that they both said “they had to come to an agreement on the commission moving forward,” but this was clearly because he rejected the interpretation Counsel was seeking to make of it. His evidence, consistently, was that the “moving forward” referred to the resale with his earlier entitlement remaining.
75 In terms of earlier dealings, it is true that Mr Silluzio apparently continued to work with Mr Hall after termination. However, it appears that no sales were effected in 2008 until after the formal authority was executed.
76 More significantly, as referred to already, Mr Hall took the trouble to bring an oral agreement reached about a variation to the attention of Mr Silluzio by written email in November, 2008. It is highly improbable that he would have executed the 2010 Authority without making reference anywhere to the alleged representation not to enforce previous entitlements if such a representation had in fact been made.
77 I therefore accept the evidence of Mr Silluzio as to events in August, 2010.
78 In coming to this view, it is also relevant that certain evidence of Mr Silluzio was corroborated by other sources.
79 Thus, the evidence of Mr Silluzio as to the agreement about the 1.5% is corroborated by the emails already cited. Moreover, if, as I have found, Mr Silluzio is accepted on this, there would be even less reason for him to agree to waive his earlier entitlements to get the “extra half per cent” as alleged by Mr Hall.
80 Mr Silluzio’s evidence that he was not told that Mr Hall was going to rescind on 9 August was also corroborated by Mr Perkoulidis who gave evidence that in a conversation with Mr Silluzio on 13 August, Mr Silluzio said he “… didn’t know what’s going on.”
81 In terms of the critical events of August, I also have come to my conclusion because of the following:
· on the basis of my assessment of both witnesses as already expressed;
· the striking absence of any reference to some
“understanding” or “representation” in any writing, including the authorities themselves;
· that the alleged representation is not even raised in the May correspondence from Keith Cameron following the delivery of the invoices; rather the first time the matter was raised in writing was when the defence was filed;
· it is inherently implausible that an estate agent would give up commission in relation to sales already made on the basis of the possibility of further sales.
82 I therefore accept and prefer the account of Mr Silluzio in relation to the events in August. In particular, I do not accept that he said anything such as “yes” or “ok” to 2% for all sales with nothing for past sales.
83 It therefore remains to consider the estoppel/s52 defences in the light of these findings.
Application to estoppel
84 In order to establish an estoppel it is necessary, critically, for Mr Hall (as agent for the defendant) to show[3]:
[3] These elements were recently summarized by Kyrou J in Associated Retailers Limited v Toys Unlimited Pty Ltd & Ors [2011] VSC 297 at [167].
(a) that he expected or understood that in return for execution of the 2010 Authority, Boss would waive its pre-existing entitlements to commission;
(b) that Mr Silluzio induced Mr Hall to adopt this expectation;
(c) that Mr Hall acted in reliance on the expectation; and
(d) that Mr Silluzio knew or intended that he would rely on the expectation.
85 It would also be necessary to show that the plaintiffs’ actions would occasion detriment if the expectation was not fulfilled and that the plaintiffs failed to avoid that detriment by fulfilling the expectation.
86 Firstly I do not accept Mr Hall’s evidence that he made any “assumption” based on his discussions with Mr Silluzio, that in return for the execution of the 2010 Authority, Boss would waive any pre-existing entitlements. As indicated already, I do not accept that Mr Silluzio said anything that could have justified such an understanding or assumption.
87 The defendant relied on Mr Hall’s evidence that when he received the May 2011 invoices it was a “shock” which was allegedly supported by Mr Silluzio’s evidence.
88 Mr Hall did give evidence that the invoices were a “shock”. However, he then said that he called the accounts manager and also Mr Silluzio. He also claimed that he had a conversation with Mr Silluzio wherein he said that there had been “…a change of company ownership and the previous owners were making a claim for commission.” This evidence was a little unclear but, more importantly, was never put to Mr Silluzio.
89 The evidence of Mr Silluzio was that when Mr Hall rang him he said that there was “… no way he was paying the invoices. He said that I was going to get paid or had been paid to sell the lots once and he felt that was enough.” He also alleged that Mr Hall threatened him. However, there was nothing to suggest that the invoices were a “shock” nor that they were contrary to some representation or assumption.
90 I therefore do not accept Mr Hall’s evidence that he really had the “understanding” he alleged.
91 Secondly, I do not accept that Boss said or did anything to induce any such assumption.
92 There may be some doubt as to whether the discussion was clear enough even if it was as alleged by Mr Hall.
93 However, for reasons given already, I accept and prefer Mr Silluzio’s account.
94 The defendant particularly relied on Mr Silluzio’s response to Mr Hall’s statement about the “past” which was “ok” and “yes.” This taken with the act of drawing up the 2010 Authority was said to constitute the alleged inducement.
95 However, for reasons given already, I do not accept that statements were made as alleged by Mr Hall.
96 I also do not accept that the drawing up of the 2010 Authority and execution of it assists the defendant. As is obvious from that authority, there is no reference to any waiver of an earlier commission.
97 Thirdly, I do not accept that Rivacourt acted in reliance on that assumption.
98 Mr Hall’s evidence was that if Mr Silluzio had said that he wanted the earlier commissions he would not have agreed to sign the 2010 contract.
99 However, under cross examination it was put to Mr Hall that if he had gone to Jellis Craig he would have still had to repay the earlier commissions to Boss.
100 Mr Hall’s responses skirted around this question. Thus, he suggested that it “could potentially” work that way but “we agreed.” When pressed, he said that if they couldn’t come to an agreement, “…we would have probably had to do that.” When pressed again, he said that “…would have come up as an argument” and that it would have “potentially” been the case.
101 I did not find Mr Hall’s responses to be credible or responsive.
102 The surrounding evidence also suggested that Mr Hall was unlikely to really go to another agent even if there was a slightly lower commission on offer (though Mr Oster was not actually called to substantiate this). Thus, the evidence of Mr Hall himself was that he was “happy” with Mr Silluzio and that they had a “good rapport.” Mr Silluzio also had already successfully sold each of the lots.
103 Thus, even if, contrary to my findings above, there was an assumption and inducement, I am unable to accept Mr Hall’s evidence that he relied on such assumption since I do not accept his evidence that he would have gone to another agent if Mr Silluzio had said he was claiming the earlier commissions.
104 Fourth, in terms of whether Mr Silluzio knew or intended Rivacourt to rely on the “assumption”, the defendant again relied on Mr Hall’s account as to what transpired at the meeting on 17 August, suggesting the entire thrust of the conversation was that if Mr Hall executed the authority then Mr Silluzio would not press for the earlier commissions.
105 For reasons given already I reject this account.
106 It therefore follows that the estoppel defence is not sustained.
Application to s52
107 The defendant again relied on Mr Hall’s account of the August meeting. It submitted that there was an implied representation on the basis of Mr Silluzio saying “ok” and “yes” to Mr Hall and then preparing the 2010 Authority. It was also submitted that Mr Silluzio was “silent” in not stating that Boss would still claim commission.
108 However, for reasons given already, I do not accept Mr Hall’s account of the August meeting.
109 I also do not accept that Mr Silluzio was “silent” in not stating that Boss would still claim prior commissions. To the contrary, I accept Mr Silluzio’s evidence that there was a discussion with regards to the previous commissions that were due and payable with Mr Hall asking if they could pay them at the end and Mr Silluzio saying that he would be happy to do that.
110 I therefore do not accept that any implied representation was made as alleged.
111 I also do not accept that there was reliance on any such a representation for reasons already given.
112 It follows that the claim based on s52 is also not established.
Summary
113 The defences based on estoppel and/or s52 of the TPA are rejected.
Entitlement of Boss
Identity of contracting party
114 The Court of Appeal recently summarised the legal principles relevant to determining the identity of contracting parties in Lederberger v Mediterranean Olives Financial Pty Ltd,[4] as follows:
Identification of the parties to a contract must be in accordance with the objective theory of contract. That is the intention that a reasonable person, with the knowledge of the words and actions of the parties communicated to each other, and the knowledge that the parties had of the surrounding circumstances, would conclude that the parties had. The process of construction requires consideration not only of the text of the documents, but also the surrounding circumstances known to the parties and the purpose and object of the transaction. This in turn presupposes knowledge of the genesis of the transaction, the background, and the context in which the parties are operating.
[4] [2012] VSCA 262 at [19].
115 Turning to the present case, it is true that the 2007 and 2008 authorities name as agent “Boss Partners P/L trading as Barry Plant (Ivanhoe)”.
116 The defendant also highlighted that the 2007 Authority does not contain the ACN of Boss and has the ABN of the Silluzio Trust not the Jaaron Trust. The 2008 Authority contains no ACN or ABN.[5]
[5] The defendant also cited s 153(2) of the Corporations Act which provides, subject to limited exceptions, that a company must set out with its name its ACN or ABN.
117 However, the evidence of Mr Silluzio was that the error in name occurred because there was a clerical error made by the receptionist who ordered the stamp. His evidence was that there was no such entity as “Boss Partners Pty Ltd” but stated that the address and contact details in each of the authorities were referable to the real estate agency known as Barry Plant (Ivanhoe) and that there was no other Barry Plant (Ivanhoe) real estate business.
118 It is true that the text of each authority includes the wrong name. However, the key matter is that “Barry Plant (Ivanhoe)” was included correctly.
119 The clear purpose and object of the transaction was also that the defendant retain the estate agency business known as Barry Plant (Ivanhoe).
120 Given that the first plaintiff, Boss, owned the business name “Barry Plant (Ivanhoe)”; was licensed under the Estate Agents Act 1980 (Vic); and traded under the business name, a reasonable person would conclude that the defendant contracted with the first plaintiff in entering the 2007 and 2008 Authorities.
121 The surrounding circumstances also make such a conclusion irresistible. These included the following:
· That Boss actually received commission relating to lot 5 under the 2008 Authority;
· That the defendant paid marketing expenses in relation to the lots to Boss;
· That correspondence passing between the parties makes reference to “BARRY PLANT” in large letters with the Ivanhoe address;
· That Mr Hall himself conceded that he knew he was dealing with “Barry Plant” operating out of the Ivanhoe offices.
122 A proper examination of the text; purpose of the transaction; and surrounding circumstances therefore leads to the conclusion that the first plaintiff, Boss, is the contracting party entitled to the commissions.
Capacity
123 In its Amended Statement of Claim, the first plaintiff included an amendment which asserts that, although it was formerly trustee of the Silluzio No 3 Family Trust, it brings this proceeding as the trustee of the Jaaron Unit Trust ((para 1(d)).
124 It further cites a sale of business agreement dated 1 September, 2010 between Boss Partners Estate Agents Pty Ltd as trustee for the Silluzio No 3 Family Trust and Boss Partners Estate Agents Pty Ltd as trustee of the Jaaron Unit Trust. It then alleges that since mid 2010, it has owned and operated the real estate business as trustee of the Jaaron Unit trust (para 5).
125 According to the evidence of Mr Silluzio, the purpose of this sale of business agreement was to effect a transfer of the real estate business from his parents to his brother and himself.
126 The amendment to the Statement of Claim was apparently made after the issue of capacity was brought to the attention of the plaintiffs by the defendant. Thus rule 5.06 requires that where a party sues in a representative capacity, the originating process shall be indorsed with a statement showing that capacity.
127 Following this notice, the first plaintiff made the amendments described and added the second plaintiff to the proceeding (which entity is now the trustee of the Silluzio trust).
128 The defendant challenged the entitlement of the first plaintiff to bring this proceeding. In particular, it highlighted various difficulties with the sale of business agreement and denied that any valid assignment had occurred.
129 The matters raised may be relevant to the true relationship between the first plaintiff and its beneficiaries. However, I have found that the first plaintiff entered the authorities and, further, that the first plaintiff is the licensee under the Estate Agents Act 1980 (Vic). In those circumstances, I am satisfied that the first plaintiff held the requisite capacity for the purposes of the present claim, and that no relevant character, capacity or right of action has been held by anyone else.[6]
[6] Royal Insurance (UK) Ltd v AMEC Construction Scotland Ltd [2007] CSOH 179 at [17].
130 In Melbourne Coach Terminal Pty Ltd v Peter Wyss,[7] Hansen J dealt with a similar submission.
[7] [2003] VSC 122.
131 That case concerned an application by a company to set aside a statutory demand which had been served in relation to commissions owed to a real estate agent, Mr Wyss. Mr Wyss’s evidence was that Mr Horne had been appointed to take control of his property in accordance with Part X of the Bankruptcy Act 1966 (Cth). Mr Wyss also acknowledged that he was not acting as agent solely for himself and that he held whatever rights he had on trust for a “partnership” between himself, Barros and Ozbey (though the evidence before Hansen J on this matter appeared to be unclear with no formal arrangement adopted in terms of respective entitlements).[8]
[8] See for example Melbourne Coach Terminal Pty Ltd v Peter Wyss [2003] VSC 122 at [17] and [23].
132 The defendant submitted that Wyss had no right to recover the commission; rather he had an interest in a partnership which meant that, if the controlling trustee wished to recover any property owed to the partnership, he could only do so with the approval of the Court under s61 of the Bankruptcy Act.
133 In dealing with this submission, Hansen J said as follows:[9]
Whatever might be the true nature of the relationship between Wyss, Barros and Ozbey, Wyss alone was, by the Authority, duly appointed as an estate agent to sell the carparking lots and entitled to receive a commission for the sale. It is further to be noted that Wyss was the sole registered owner of the business name Ray White Project Marketing (Victoria), and that Barros and Ozbey were not licensed estate agents. Hence, it was understandable that the Authority appointed Wyss trading as Ray White Project Marketing (Victoria) without any reference to Barros and Ozbey. In these circumstances Wyss possesses the legal right to claim and receive amounts due as commissions under the Authority. It is a separate matter as to the manner in which he should deal with monies so received, as between himself, Barros and Ozbey. If there needs to be an inquiry to ascertain the nature and terms of the relationship including the respective entitlements of Wyss, Barros and Ozbey to the assets and property of a partnership or trust, that can be had and the property dealt with accordingly. But in the first instance, Wyss is entitled, legally, to claim and receive the commissions due under the Authority. For these reasons, s61 of the Act is not applicable (emphasis added).
[9] [2003] VSC 122 at [42].
134 The defendant suggested that the case was distinguishable because Mr Wyss was not a corporate entity and that no question was raised about entry into the agency agreement in the capacity as a trustee.
135 However, the fact that the first plaintiff is a corporation makes no difference to the analysis, since it was the first plaintiff entity alone which was duly appointed under the authorities. It was also the sole registered owner of the business name, Barry Plant (Ivanhoe), and a licensed real estate agent.
136 The common law also does not recognise a trustee as having an additional or qualified legal personality by reason of its status as a trustee.[10]
[10] J. D. Heydon and M. J. Leeming, Jacobs’ Law of Trusts in Australia (LexisNexis Butterworths, 2006), at [2102]
137 There was also a question raised as to Mr Wyss’s capacity as a trustee, since Mr Wyss himself suggested that he held whatever rights he had “on trust” for the partnership.[11] However, this did not detract from his legal right to make the claim just as it does not detract in the current instance.
[11] Melbourne Coach Terminal Pty Ltd v Peter Wyss [2003] VSC 122 at [41].
138 I am therefore satisfied that the firstnamed plaintiff, Boss, possesses the legal right to claim and receive the amounts due as commissions under the authorities.
139 However, given the second plaintiff was not a party to the authorities and is also not licensed for the purposes of the Estate Agents Act 1980 (Vic),[12] it has no such entitlement with the result that its claim should be struck out.
[12] s50(1)(a) provides that an estate agent is not entitled to sue for commission unless he or she is the holder of an estate agent’s license.
140 It is in such circumstances unnecessary to resolve the issue as to the relationship between Boss and any beneficiary. However, I will briefly record my views given the time taken on the issue.
141 Clause 8 of the Silluzio Number 3 trust deed gives power to the first plaintiff to “transfer” or “dispose of” any real or personal property of the trust fund including power “at their absolute discretion” to sell to themselves in their capacity as trustees of other trust funds for cash. Further, notwithstanding, as highlighted by the defendant, the exercise of such a power “may” be by a resolution (under clause 16.3), I see nothing in the trust deed which requires such a resolution.
142 Turning to the sale of business document, it does appear to include signatures of non-directors (as highlighted by the defendant). However, it was executed by 2 directors of the corporate trustee at the time (both father, Lou Silluzio and son, Aaron Silluzio).[13] Moreover, the clear intention evinced by the document is that, pursuant to its broad powers, and in return for the purchase price, all of the assets of the real estate business, of Barry Plant (Ivanhoe), formerly held by Boss under the Silluzio trust,[14] be transferred and held instead by Boss subject to the Jaaron Trust.
[13] See s127 of the Corporations Act 2001 (Cth).
[14] Including trade debtors and commissions receivable: see special condition 9.2 and schedule 10.
143 To the extent it was necessary to determine, the first plaintiff therefore appears to be entitled to bring this proceeding as trustee of the Jaaron unit trust.
144 In any event, for reasons given already, I am satisfied that the first plaintiff possesses the legal right to claim the commissions sought and, further, that it is entitled to judgment in the amount sought.
Conclusion
145 There will be judgment for the first plaintiff in the amount of $138,600.
146 The claims of the second plaintiff will be struck out.
147 I will hear from the parties as to the precise form of final order.
SCHEDULE
| BOSS PARTNERS ESTATE AGENTS PTY LTD (ACN 057 852 990) AS TRUSTEE FOR THE JAARON UNIT TRUST T/AS BARRYPLANT (IVANHOE) | First Plaintiff |
| DOMJAF PTY LTD (ACN 143 088 055) AS TRUSTEE FOR THE SILLUZIO NO.3 FAMILY TRUST | Second Plaintiff |
| AND | |
| RIVACOURT PTY LTD (ACN 115 073 982) | Defendant |
| AND BETWEEN | |
| RIVACOURT PTY LTD (ACN 115 073 982) | Plaintiff by Counterclaim |
| AND | |
| BOSS PARTNERS ESTATE AGENTS PTY LTD (ACN 057 852 990) T/AS BARRYPLANT (IVANHOE) | Defendant by Counterclaim |
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