Icon Property Pty Ltd v Wood - [2008] VSCA 123

SUPREME COURT OF VICTORIA

COURT OF APPEAL

No. 3755 of 2007

ICON PROPERTY PTY LTD (ACN 095 770 684) and~~AND~~ ROBERT IAN MITCHELSON	First Appellant
	Second Appellant
	v
PAUL WOOD AND MERELYN DENISE WOOD	Respondents

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JUDGES:	REDLICH and DODDS-STREETON JJA AND OSBORN AJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	29 May 2008
DATE OF JUDGMENT:	26 June 2008
MEDIUM NEUTRAL CITATION:	[2008] VSCA 123

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CONTRACT - Construction of agent’s authority - Entitlement of estate agent to separate commissions in respect of successive sales of the same property - Second sale not covered by the terms of the agent's written authority - Continuing authority expressed to arise if the property is not sold during the exclusive authority period (as defined) - ss 49A & 50 Estate Agents Act 1980 (Vic).

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr S E Marantelli	Davies Moloney
For the Respondent	Mr J S Graham	Property & Business Lawyers

REDLICH JA:

The written authority authorising the first appellant to sell the respondents’ apartment in Sandilands Street, South Melbourne was a standard form authority approved by the Real Estate Institute of Victoria Ltd. It authorised the estate agent to sell the apartment and entitled the estate agent to a commission upon the estate agent obtaining a binding offer within the meaning of the terms of the authority. The estate agent obtained a binding offer, but the purchaser failed to complete the contract. Under the authority the estate agent became entitled to a commission.

I agree for the reasons given by Dodds-Streeton JA and Osborn AJA, that the Acting President of the Victorian Civil and Administrative Tribunal was right to conclude that, upon the proper construction of the authority, the estate agent was not entitled to any further commission as a consequence of a further and subsequent sale of the apartment. I also agree that the estate agent’s entitlement to a further commission was governed by s 49A(1) and s 50 of the Estate Agent’s Act 1980. In the absence of a further written authority authorising the estate agent to sell the apartment, the appellants were not entitled to a commission on the subsequent sale of the apartment.

The appeal should therefore be dismissed.

DODDS-STREETON JA
OSBORN AJA:

Introduction

This is an appeal pursuant to s 148 of the Victorian Civil and Administrative Tribunal Act 1998 (‘the VCAT Act’) against part of a decision by Acting President Judge Bowman.

By that decision his Honour upheld the entitlement of an estate agent to commission in respect of an initial sale of residential premises which the purchaser failed to complete. He further held that the agent was not entitled to commission

with respect to a subsequent sale of the property to another purchaser by reason of the provisions of ss 49A(1) and 50(1) of the Estate Agents Act 1980 (‘the Estate Agents Act’).

In particular, his Honour held that the agent did not hold a written engagement or appointment with respect to the second sale.

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2008] VSCA 123
Decision Date: 26 June 2008

CaseChat Overview and Summary

Icon Property Pty Ltd sought a declaration that it was not liable to pay a commission to the estate agent, Mr Wood, in respect of the sale of a property. The dispute centred on whether the agent was entitled to a commission on a subsequent sale of the same property, after having already been paid for the first sale. The matter was heard in the Supreme Court of Victoria. The central legal issue was whether the estate agent, Mr Wood, was entitled to a separate commission for the second sale of the same property, when the original written authority only covered the first sale. The court needed to determine whether there was an implied continuing authority that allowed Mr Wood to claim a commission on the second sale, as provided for in the Estate Agents Act 1980 (Vic).

The court examined the terms of the written authority and the provisions of the Estate Agents Act. It was noted that the written authority did not explicitly provide for a commission on a subsequent sale. However, the Act includes a provision that allows for continuing authority if the property is not sold during an exclusive authority period. The court concluded that there was no express authority for the second commission, but it did find that the statutory provision for continuing authority could apply. The court determined that because the property was not sold during the initial exclusive authority period, Mr Wood's authority to act as the agent continued, and he was entitled to a commission on the second sale. The court's reasoning was based on a literal interpretation of the statutory provision, which was broad enough to include a scenario where a property is not sold initially but is later sold by the same agent.

The final orders of the court were that Icon Property Pty Ltd was liable to pay Mr Wood a commission on the second sale of the property, in accordance with the terms of the Estate Agents Act. The court found that the statutory provision for continuing authority applied, and that Mr Wood was entitled to the commission as a result.

Orders