Finnis v Real Estate Now Pty Ltd

[2013] QCATA 150

CITATION: Finnis & Anor v Real Estate Now Pty Ltd [2013] QCATA 150

PARTIES:	Lloyd Peter Finnis Marion Helena Finnis (Applicants/Appellants)
v
Real Estate Now Pty Ltd (Respondent)

APPLICATION NUMBER: APL443-12

MATTER TYPE: Appeals

HEARING DATE: On the papers

HEARD AT: Brisbane

DECISION OF: Mr C Brabazon QC, Member

DELIVERED ON: 13 May 2013

DELIVERED AT: Brisbane

ORDERS MADE:

1.    Allow the appeal against the adjudicator’s order of 9 October 2012.

2.    Set aside that order.

3.    Order that the respondent pay $10,000 to the appellants.

CATCHWORDS:

APPEAL – form of agents’ appointment – commission – not payable by vendors.

Property Agents and Motor Dealers Act 2000 (Qld), s133, s 134 and s 140

APPEARANCES and REPRESENTATION (if any):

APPELLANT:	Mr Lloyd Finnis
RESPONDENT:	Mr M Mergard

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).

REASONS FOR DECISION

1. Mr and Mrs Finnis sold a commercial property to Mr and Mrs Hiscock. Their agent was Real Estate Now Pty Ltd, in Bundaberg.

2. There is a dispute about the payment of the agent’s commission. It has not been paid. The agent wants to recover it – $12,879.00 would be the usual statutory amount. The solicitor for the vendors says that no commission is payable.

3. The dispute came before a Magistrate, sitting as a QCAT Adjudicator. The parties were not legally represented. Mr Mark Mergard, a real estate agent, and Mr Lloyd Finnis appeared.

4. The agency holds $10,000, paid as the deposit. Mr Mergard said that the agency would be quite happy to settle for that amount.

5. The Adjudicator found that the agent and Mr Finnis had discussed the payment of commission, and that the agent had been “instrumental in the sale of the property”. The two men knew each other well. At the hearing they told the Adjudicator that they were friends. They had a discussion about the amount of commission. Mr Mergard said that Mr Finnis agreed to pay commission. Mr Finnis remembered talking about the commission.

6. The Adjudicator was told that a “Form 21A” or “commission form” had not been signed, and given to the purchasers. He accepted that submission, which is now not contested by Mr Mergard. He then decided that the agency should be paid the $10,000, but not the further $2,897.50, because of that “oversight and omission”.

7. Mr Finnis now appeals against that decision. He submits that he and his wife are not obliged to pay any commission. He asks for payment of the $10,000 held in the agent’s trust account.

8. The Property Agents and Motor Dealers Act 2000 has strict requirements about the appointment of agents:

   (a)A real estate agent must not act for a client, unless there is first an appointment in writing – s 133(1).

   (b)The form of appointment must be in the approved form – s 134(1).

   (c)An appointment that is not in the approved form is ineffective from the time it is made – s 134(3).

   (d)An agent cannot sue for commission, if there is no proper appointment – s 140.

9. Clause 30 of the contract of sale said this –

   Appointment of agent

   In the absence of any specific appointment, the vendor by executing this contract confirms the appointment of the vendor’s agent … as the agent of the vendor to introduce a buyer.

10. It is clear that the agent did not comply with the requirements of the Act. He knew about the statutory requirements but forgot about them on this occasion.

11. Mr and Mrs Finnis made a complaint to the Office of Fair Trading. A breach of the Act was found, and “appropriate enforcement action was taken against the license …”.

12. The Adjudicator saw a copy of the Office of Fair Trading letter. He accepted that the requirements of the Act had not been followed. Mr Mergard now concedes that.

13. The requirements of the Act, set out above, are mandatory. The Adjudicator was in error, in finding that $10,000 was payable. The only conclusion is that the agency is not entitled to recover any commission. The law is quite clear. The Adjudicator, and this Tribunal, have no choice, or discretion, to decide that the purchasers should pay any commission.

14. Condition 30, set out above, is not sufficient to overcome the requirements of the Act. That appointment is not in the approved form.

15. Mr Mergard will be surprised and disappointed by the response of Mr Finnis, with whom he had a friendly relationship. Mr Finnis has taken advantage of his slip, to avoid a payment which he expected to pay. However, the law is clear – the agent is not entitled to recover the commission.

16. This is the order that has to be made:

    (a)Allow the appeal against the adjudicator’s order of 9 October 2012.

    (b)Set aside that order.

    (c)Order that the respondent pay $10,000 to the appellants.