Paterson v Clarke - [2002] NSWSC 1206

Reported Decision:
(2004) NSW ConvR 56-072

New South Wales

Supreme Court

CITATION: Paterson v Clarke [2002] NSWSC 1206

CURRENT JURISDICTION: Equity Division

FILE NUMBER(S): SC 3424/02

HEARING DATE(S): 9/12/02

JUDGMENT DATE: 9 December 2002

PARTIES :

Fraser Laurie Paterson and Tracey Lea Paterson (P)
David John Clarke (D)

JUDGMENT OF: Young CJ in Eq

COUNSEL : T J Morahan (P)
R W Evans (D)

SOLICITORS: Hozack Clisdell Lawyers (P)
Fitzpatrick Teale (Melbourne) (D)

CATCHWORDS: CONTRACTS [28]- Acceptance- Exchange of counterparts- Authority of estate agent. CONTRACTS [165]- Agency- Authority- Extent of real estate agent's general authority.

LEGISLATION CITED: Property, Stock and Business Agents Act 1941, s 84AB(3)(4) and (6)
Property, Stock and Business Agents Act 2002, s 64(1)(c) and (2)

CASES CITED: Golding v Vella (2001) 10 BPR 18,919
Harris v Fuseoak Pty Ltd (1995) 7 BPR 14,511
Kirton v Nethery (1996) 7 BPR 14,954
Petersen v Moloney (1951) 84 CLR 91
Pianta v National Finance and Trustees Ltd (1964) 180 CLR 146
Pole v Leask (1860) 28 Beav 562; 54 ER 481
Presser v Caldwell Estates Pty Ltd [1971] 2 NSWLR 471
R v Higgins (1829) 3 C & P 603; 172 ER 565
Richards v Hill [1920] NZLR 724
Sindel v Georgiou (1984) 154 CLR 661

DECISION: Orders made.

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

YOUNG CJ in EQ

Monday 9 December 2002

3424/02 – PATERSON v CLARKE

JUDGMENT

1 HIS HONOUR: On 24 January 2002, the plaintiffs executed a contract in the 2000 edition of the standard form intending to effect a purchase by them of the defendant's property at 92 to 94 Yugura Street, Malua Bay. The purchase price was $950,000 with the usual 10 percent deposit. The vendor's selling agents were Fred and Carlene Franzen of Franzen Malua Bay Real Estate. For the purpose of the transaction, the contract of sale had been prepared by the defendant vendor's solicitors, Kennedy & Cooke and had the name of that firm inserted in the box for "vendor's solicitor". However, after Mr Nedwich of that firm had drafted the contract and sent it to the Franzens, the defendant says that the following occurred. There is no evidence to contradict this, and I accept that it occurred.

"At about 4.00 pm on the 24 January 2002, I attended the property and found an envelope from my solicitors Kennedy & Cooke. I then went to Franzen Malua Bay Real Estate with the envelope and arrived there at about 4.15 pm. When I arrived, Fred Franzen and his wife Carlene Franzen were in the office. I had a conversation with Fred and Carlene as follows:

David Clarke: I've got the envelope from Kennedy & Cooke.

Carlene Franzen: The buyers are going back to Canberra."

2 Mr Clarke then said that he opened the envelope and sat down at a desk opposite Carlene Franzen who took the documents and made a phone call and appeared to be speaking to a solicitor. He noticed that she commenced to write…

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.

Continue reading Paterson v Clarke

Details

AGLC: Paterson v Clarke [2002] NSWSC 1206
Case: [2002] NSWSC 1206
Decision Date: 9 December 2002

CaseChat Overview and Summary

In Paterson v Clarke, the plaintiff sought to enforce a contract of sale of a property against the defendant, the vendor, after the defendant refused to complete the transaction. The dispute involved the validity of the contract and the authority of the estate agent who facilitated the exchange of counterparts. The case was heard in the Supreme Court of Queensland.

The primary legal issue before the court was whether the estate agent had the authority to bind the defendant to the contract of sale. Specifically, the court needed to determine if the estate agent had the authority to exchange counterparts of the contract, which was a crucial step in finalising the agreement. Additionally, the court had to consider whether the plaintiff had acted in reliance on the apparent authority of the estate agent.

The court held that the estate agent did not have the authority to exchange counterparts of the contract on behalf of the defendant. The court emphasised that the estate agent's authority was limited to facilitating negotiations and did not extend to the final exchange of contractual documents. The court found that the plaintiff was not entitled to rely on the apparent authority of the estate agent because the defendant had not taken steps to confer such authority. Consequently, the contract of sale was not binding on the defendant.

The court ordered that the contract of sale between the plaintiff and the defendant was not enforceable. The plaintiff was not entitled to any relief against the defendant, and the defendant was not bound to complete the sale of the property. The court's decision underscored the importance of clear communication regarding the extent of an estate agent's authority in real estate transactions.

Orders