Newham Business Brokers Pty Ltd v ACN 120 452 744 Pty Ltd and Anor (Civil Dispute)

Newham Business Brokers Pty Ltd, the applicant, filed a complaint against ACN 120 452 744 Pty Ltd and another, the respondents, in the Federal Circuit Court. The applicant sought the payment of a commission under a contract dated 8 April 2015. The dispute centred around the commission that the applicant was due from the sale of a business, which was brokered by the applicant and subsequently purchased by a third party. The crux of the matter was whether the applicant was entitled to the commission despite an assignment of the business brokering agreement to another broker.

The central legal issue before the court was whether the assignment of the business brokering agreement to another broker, who then effectively introduced the purchaser to the vendor, entitled the applicant to the commission. The applicant argued that despite the assignment, they were still entitled to the commission because they were the original agent who introduced the purchaser to the vendor. The respondents contended that the assignment of the contract meant that the new broker was entitled to the commission.

The court determined that the applicant was entitled to the commission despite the assignment of the business brokering agreement. The court found that the assignment did not deprive the applicant of their right to the commission because the applicant was the original agent who introduced the purchaser to the vendor. The court held that the assignment did not ‘effectively introduce’ the purchaser to the vendor. The court emphasised that the assignment was an ‘absolute assignment’ of the contractual right to receive commission, and therefore, the original agent was still entitled to the commission. The court ordered that the respondents pay the applicant the commission payable under their contract dated 8 April 2015. The matter was listed for directions on 31 March 2020 at 10:30am.