Royle v Property Direct P/L

[2010] QDC 265

DISTRICT COURT OF QUEENSLAND

CITATION:

Royle v Property Direct P/L [2010] QDC 265

PARTIES:

SHANE ROYLE
(Plaintiff)

v

PROPERTY DIRECT PTY LTD
(Defendant)

FILE NO/S:

BD2672 of 2006

DIVISION:

Civil jurisdiction

PROCEEDING:

Trial

ORIGINATING COURT:

Brisbane

DELIVERED ON:

4 June 2010

DELIVERED AT:

Brisbane

HEARING DATES:

18, 19 and 20 August and 30 September 2009

JUDGE:

Devereaux SC, DCJ

ORDER:

1. The defendant pay the plaintiff the sum of $62,961, being the judgment amount of $47,879 plus interest at 9% over 3½ years, $15,082
2. The defendant pay the plaintiff’s costs excluding any amount paid to expert witnesses.

CATCHWORDS:

CONTRACT – TERMS AND PARTIES – CONSTRUCTION RULES – Evidence of context – where plaintiff claims final instalment of commissions as real estate agent and sales manager in off-the-plan sales – whether plaintiff available to perform settlement duties

Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451

COUNSEL:

KC Kelso for plaintiff
PA Looney for defendant

SOLICITORS:

Michael Drummond Lawyer for plaintiff
Shand Taylor Lawyers for defendant

1. Mr Royle, the plaintiff, claims for unpaid commissions that he says are owed under an employment agreement.  The defendant, Property Direct Pty Ltd (Property Direct), says it was entitled to adjust outstanding commissions, as provided for by the agreement, because the plaintiff was not available to carry out certain duties under the agreement as sales manager and as an agent.

1. The issue is whether Mr Royle was available at settlement and fully available to attend to settlement matters, as those terms are used in the parties’ remuneration agreements.  He says he was so available but that Property Direct prevented him from carrying out his tasks.

The parties and their agreements

1. Property Direct is a real estate agency which specialises in selling off the plan projects.  Relevantly, it was contracted to sell and market the Aurora residential development situated at 420 Queen Street, Brisbane (Aurora).

1. Mr Royle entered into a written contract of employment with Property Direct on 30 September 2001.  By that contract, relevantly:

(a)            The employer was required to pay each employee commission as                    notified in writing from time to time for each project and the   employer retained the right to vary the commission rate payable   from time to time (clause 4);

(b)            The employee was required to carry out duties of a real estate    salesperson in the employer’s business in accordance with   directions given by the employer (clause 5.1);

(c)            The employee undertook not to be placed in the position where a   conflict of interest may arise (clause 5.2);

(d)            The employee acknowledged that information regarding clients and   the business interests, operations and affairs of the employer   were confidential and belonged to the employer (clause 10).

1. Aurora was to be the largest such development in Brisbane.  It was twice as big as any such project Property Direct had been involved in marketing. 

1. Typically, some years would pass between the execution of a contract to buy and sell an apartment in a project and the settlement of the contract.  In respect of each development which it was engaged to market and sell, Property Direct would enter into a further written arrangement with the sales manager and each of the sales agents working on that development that was specific to the development. These documents supplemented the employment agreements and were known by the parties as ‘remuneration agreements’.

1. In respect of Aurora, the anticipated period from selling to settlement was 4 years.  On 17 May 2002, Mr Royle entered into a remuneration agreement as sales agent and a separate remuneration agreement for his role as sales manager.

1. The terms of the remuneration agreement in respect of the sales manager’s role included:

2.For your role as Sales Display Manager an override of 0.25% of purchase price will be paid on your sales and all sales from your Property Direct Sales Team where Property Direct is the Agent and received 3.5% commission. This payment will be in line with the APH payment at settlement (Refer to Item 4 of the agreement).

3.This override is for taking complete responsibility for all facets in the sales display and attending to settlements of these sales. Should the sales display manager not be fully available to attend to settlement matters, then Property Direct reserves the right to adjust final commissions.

1. The terms of the remuneration agreement in respect of the sales agent’s role included:

2.All unconditional sales will be paid at a gross commission rate of 1.5% of sale price. Of the total 1.5% commission, payment will be as follows; 0.625% will be paid at unconditional status and an additional 0.225% will be paid upon construction finance being approved and the balance 0.65% payable at settlement. (Refer Item 4 of the Agreement).

3.          Payment will be in line with APH payment to Property Direct.

4.Property Direct reserves the right to adjust final commissions should the agent not be available at settlement to attend his or her AURORA Clients.

1. Aurora “came on stream”[1] in May 2002. The contracts for residential units sold by Mr Royle or members of his sales team became unconditional during 2002.[2] Construction finance was approved “in or about 2002 and prior to May 2006”.[3] The contracts settled in about May 2006. 

   [1] 3-13.38

   [2] Amended Statement of Claim, paragraph 3.

   [3] Amended Statement of Claim, paragraph 5.

1. Mr Royle ceased his formal position with Property Direct in the second half of 2002, taking “leave of absence”[4] but remaining “very involved with the company”[5]. He resigned on 14 October 2003.[6] By late 2003, none of the sales agents who had originally been part of the sales team on Aurora were still employed by Property Direct.

   [4] 1-48.45

   [5] 1-48.58

   [6] Exhibit 4

1. After resigning from Property Direct, Mr Royle opened his own business, BCQ Property.  It engaged in “selling projects, selling property”[7], “similar to the nature of what Property Direct was doing”[8].  He was engaged, by the developer, to sell some apartments called sky homes in Aurora.  After a while, he moved his activities to northern New South Wales.

   [7] 1-77.5.

   [8] 1-77.12

1. Mr Royle had purchased two apartments in Aurora and he was living there in May 2006, when he attended pre-settlement inspections for some of those who had bought apartments through his agency, BCQ.  He also attended pre-settlement inspections for some “family and close fiends” who had purchased through Property Direct.[9]

   [9] 1-99.40-60

The cases pleaded and argued

1. It is not expressly pleaded that Mr Royle was available, in the relevant sense, as required, to attend settlement matters.  It is simply pleaded that, the contracts having settled in or about May 2006, Property Direct was obliged to pay the final portion of the commissions owed to Mr Royle under the two remuneration agreements. 

1. Property Direct pleads that it was not obliged to pay the remaining portions because, Mr Royle having ceased to be employed by Property Direct, he was unavailable to attend to the duties which were pre-conditions to settlement.[10] Property Direct made its position known to Mr Royle by a letter dated 21 February 2006.   It included the following:

Regrettably, as you are no longer employed by Property Direct Pty Ltd you cannot represent us through the settlement process. At no time should you contact any Purchasers in the Aurora development in regard to their settlement matters, as this will be seen as a breach of The Privacy Act because you are no longer employed by us and no longer have authority to use any information that was obtained through your employment with us.

[10] Defence, paragraph 7.

1. The letter informed the reader that Property Direct would exercise its right to adjust commissions – reducing each sale commission by $500 and the manager’s override commission by 50%.

1. Mr Royle, through his solicitor, wrote, on 24 February 2006, that his availability was not contingent on his employment status and that he was “available to attend settlement”.[11]

   [11] Exhibit 19

1. In evidence, Mr Beard, the managing director of Property Direct and its principal witness, explained that Mr Royle was excluded from pre-settlement activities because, among other things, “he had set up a competitor company”.[12]  In evidence, Mr Royle said he was available at the relevant time.

   [12] 3-28.5

1. Neither party prosecuted precisely its case as pleaded. Briefly put, the plaintiff argued that he was entitled to the balance of the commissions (which had already accrued) because he had been available, in terms of the agreements, to perform pre-settlement duties.  That in the end he did not do so was the fault of the defendant, who stopped him doing so.  The defendant did not argue that the plaintiff was unavailable (only) because no longer employed, but that given his conflicting interests and the nature of his own business it was not reasonably possible for him to act in either role on behalf of Property Direct.

1. The agreed amounts in dispute are:

Manager override       $ 76,715
  Sales Commission      $ 24,864

Total  $101,579

The meaning of the agreements

1. The effect of the employment agreement and the two remuneration agreements was, relevantly, that sales commission with respect to a sales contract was owing once the contract became unconditional, payable in three stages, and subject to the employer’s reserved ‘right’ to adjust the commission under clause 4 of the remuneration agreement. The manager’s override was in consideration of Mr Royle’s taking complete responsibility for all facets in the sales display and attending to settlements of these sales, payable at settlement subject to the employer’s reserved ‘right’ to adjust the commission under clause 3.

1. Counsel for both parties submitted the meaning of the remuneration agreements is to be determined objectively, by considering their text, the surrounding circumstances known to the parties and the purpose and object of the agreements: Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451

1. An early apparent disagreement between the parties evaporated during the hearing of the claim.  It was common ground by the end that settlement, in the terms available at settlement and fully available to attend to settlement matters, did not refer to the ultimate exchange of documents and money on the date of completion of the contracts.  The terms referred to activities to be undertaken by Property Direct in the months leading up to completion.

Purpose

1. The objective purpose of the terms is apparent enough.  The measure was designed to encourage the person entitled to commission in respect of a particular sale to provide relevant services through to completion and, in default, to allow Property Direct to adjust the commission payable.  Relevant circumstances included:

• Property Direct expected to receive its commission on sales of apartments in Aurora in two stages - half at the time a contact became unconditional and half at settlement.[13]  If the contract did not go to completion the amount received earlier must be remitted to the developer.

• The anticipated size of the development was about 450 apartments.[14]
• Construction was expected to take two years and would not commence until the required “pre-sales” target had been reached.[15]

• The expected period from sale to completion was about 4 years.[16]
• Aurora was twice as big as any other similar project Property Direct had been involved in marketing.[17]

[13] 3-16.40

[14] 3-12.10

[15] 3-12.20

[16] 3-21.25

[17] 3-12.30

1. While agreeing that the real estate business was “quite a transient industry”, Mr Beard spoke of putting “policies and integrity in place” to encourage employees to stay longer with the company.[18]

[18] 3-39.25-40

Surrounding circumstances

1. The surrounding circumstances known to the parties included the employment agreement signed in September 1991, their common experiences in marketing other similar projects; the generation of “re-sales” pending completion of the original sale; the nature of the relationship developed between real estate agent and buyer and a meeting between Mr Beard and Mr Royle in May 2002.  I will consider each of these in turn.

1. The employment agreement of September 1991 provided the essential context to the remuneration agreements.  The portion referred to earlier includes requirements that the employee not place himself in a position of conflict with the employer and an acknowledgement that certain information, obtainable by an employee, was confidential to the employer.

1. Mr Royle, who considered himself a specialist off-the-plan sales person, joined Property Direct in either 1998 or 1999. At that time, a development called Petrie Point was under construction.  Mr Royle became sales manager of that project.  That involved his selecting and training staff, attending to all aspects of the sales display and reporting to the company’s head office. 

1. Broadly speaking, the witnesses identified three phases in the marketing of off-the-plan apartments: first, achieving an unconditional contract in respect of an apartment; second, a long period of little activity but for occasional contact with buyers; and third, between six and three months of increasing activity culminating in settlement.

1. The Petrie Point development was already under construction when Mr Royle was engaged in its marketing.[19]  The project involved building about 180 apartments.[20] The pre-settlement activities, which occurred over a several months, included liaison with purchasers and bank valuers as well as some involvement in the pre-settlement inspections.  As Mr Royle said in this context, “Property Direct has some work to do for their commission.”[21]  He made the point, however, that the pre-settlement tasks may vary according to the directions of the developer.[22]

   [19] 1-58.50

   [20] 1-69.20; 2-119.10

   [21] 1-71.20

   [22] 1-72.20

1. Mr Royle was also engaged in the marketing, by Property Direct, of other projects called Felix, Frisco, Emporium and Metropole.  These were not as large as Petrie Point.

1. Ann Walker, who was employed by Property Direct as a sales person on the Frisco and Aurora projects, became sales manager of Aurora in November 2002.  She was presented with a three page document setting out the roles and responsibilities of the project supervisor.[23]  The points included ranged from broad injunctions, for example, to “Act in Property Direct’s best interests at all times”, through numerous detailed leadership activities to reporting requirements.  Ms Walker had observed Mr Royle in the role of sales manager on the Frisco project.  She agreed he had been passionate and active in the role and that he was “hands on with the project that was settling at the time”.[24]  She commented that the role she observed was similar to the list she was given as project manager.[25]

   [23] Exhibit 30

   [24] 2-26.40

   [25] 2-26 - 27

1. Adam Foote, who at relevant times (but not in the pre-settlement period of the Aurora building) was the general manager at Property Direct, gave further evidence about the role of sales staff pre-settlement.  He described it as a co-ordinating role - making sure buyers had obtained funds to settle, that solicitors and banks were aware of the settlement date.[26] He agreed sales staff could be involved in attending to defect issues regarding apartments, supplying information to valuers, attending opening functions, introducing buyers to onsite managers.[27]  He accepted as fair comment the proposition that the longer the period between sale and settlement the more potential there was for matters to arise requiring attention pre-settlement.[28]

   [26] 2-71

   [27] 2-92 - 93

   [28] 2-98.20

1. Mr Foote said the sales manager’s role was “to handle all facets of the sales agents from start through to getting the contract unconditional through to settlement.”[29]

   [29] 2-97.10

1. Speaking of the Petrie Point experience, Mr Beard detailed many activities required from about six months prior to settlement, including contacting buyers and “building their enthusiasm for settlement”[30] and co-ordinating “what’s happening on site”[31].  He said staff were involved in some pre-settlement activities from about four months out[32] and were engaged full time for about four weeks before settlement.[33] 

   [30] 2-122 - 123

   [31] 3-4.35

   [32] 3-5.20

   [33] 3-3.10

1. Mr Beard testified that, in May 2002, about the time of the signing of the remuneration agreements, he discussed with Mr Royle the importance of the sales manager’s presence “on site taking care of all settlement matters” and of a “four year commitment” from the sales manager.[34] Mr Royle accepted there had been a discussion but did not recall the details of what was said at the meeting.[35] 

   [34] 3-22.35

   [35] 1-74

1. Mr Royle accepted the proposition that he would gain a substantial amount of confidential information as an employee of Property Direct.[36]  This extended to learning when a buyer wished to re-sell a unit before settlement.  As an employee, he would take the listing on behalf of Property Direct.

   [36] 1-55.5

1. Mr Royle recognised that so-called re-sales were an important part of the business of project selling.[37] He spoke of the importance of controlling the project, “for keeping the value of the properties up, for keeping the valuers online”.[38]

   [37] 1-28.40

   [38] 1-29.20

1. Mr Foote agreed that information a sales agent obtained about a buyer’s intention to re-sell was important to Property Direct “from the potential earnings point of view”.[39]

   [39] 2-97.30

1. Mr Beard testified[40] that the importance of controlling re-sales was not just a matter of keeping income-producing sales within the business.  Explaining the point made by Mr Royle, he said that a discounted sale by an unconnected agent may affect the valuations of unsold apartments, to the developer’s detriment, and, as I understand the point, the values of sold apartments, to the potential detriment of buyers seeking finance. A further reason for controlling re-sales was to preserve the property management rights sold by the developer to the on-site manager.[41]

[40] 3-53

[41] 3-67.20-35

Discussion

1. There is ultimately little dispute between the parties as to the nature of pre-settlement activities that would have been apprehended at the time of the remuneration agreements.  The common experience of the Petrie Point project and the anticipation of so many Aurora contracts settling at around the same time suggested considerable work would need to be done in the pre-settlement period.  So much was discussed by Mr Beard and Mr Royle in May 2002.

1. The agreements required Mr Royle to be available in the future – at a time not precisely known but ascertainable in due course – to perform pre-settlement tasks.  The precise nature of the tasks would not be known until the time came to perform them.  The agreements must be read as requiring Mr Royle to be available in the future to perform whatever tasks were reasonably required to be done to fulfil the two roles named in the remuneration agreements – sales manager and sales person.

1. Whether he was available to perform those roles must be assessed having regard to what was in the contemplation of the parties at the time of the agreements and in the knowledge of what was actually required to be done when the time came.

1. Relevant in this respect is the circumstance that an agency called handovers.com was appointed to carry out the pre-settlement inspections.  One object of that exercise was to identify defects in the building and bring them to the builder’s notice for rectification.  To some degree, the engagement of handovers.com reduced the burden on Property Direct staff.

1. Luke Best, a sales agent for Property Direct, gave evidence that he and another employee, Melanie Graham, undertook duties relating to Aurora over a long period leading up to settlement.  About 12 months before settlement they started contacting the buyers to ensure records were correct and to answer questions.  From about six months before settlement, they “really needed to knuckle down” to making sure buyers would be ready for settlement.[42]  Melanie Graham became the manager of the Aurora process as settlement approached.[43]  Mr Best said that from about six months before settlement he would deal with a matter related to Aurora about once a week.  Melanie Graham would be engaged every second day in an Aurora matter.[44]

   [42] 3-115.10

   [43] 3-116.10

   [44] 3-117

1. About 12 to 14 weeks out from settlement they operated from the builder’s site office.[45]  They were, during this period, committed to the Aurora settlement full-time.[46] Although handovers.com conducted the defect inspections, Property Direct employees would be present during the inspections.[47]  Mr Best and Ms Graham assisted the handovers.com person in contacting buyers and arranging inspection times.[48]

   [45] 3-116.30; this was consistent with Mr Beard’s evidence that Mr Best and Ms Graham were engaged

   “effectively full-time” in the settlement of Aurora “three to four months prior to settlement”: 3-10.5

   [46] 3-118.20

   [47] 3-118.40 – 3-120; 3-28.40

   [48] 3-61.25; 3-120.45  

1. Ann Walker, who succeeded Mr Royle as sales manager of Aurora in about November 2002, bought a unit in Aurora.  She gave evidence, for Mr Royle, that Luke Best and Melanie Graham attended the inspection without having any apparent substantial role in the process.[49] By this time, she no longer worked for Property Direct.[50] Her opinion that the Aurora pre-settlement process was different from that of earlier projects was based on her experience not as an employee but as a purchaser.

[49] 2-16 – 2-17

[50] 2-25.35

Was Mr Royle available?

1. I have referred earlier in these reasons to Mr Royle’s departure from Property Direct and his activities thereafter.  I accept Mr Beard’s evidence that Mr Royle’s company, BCQ, was effectively in competition with Property Direct.  There was no real challenge to that position.  Mr Royle agreed, as set out earlier, that his own business was similar in nature to that conducted by Property Direct.  He had left Property Direct at least 2½ years before the Aurora apartments settled.  He had been replaced as manager in late 2002, about 3½ years before settlement. 

1. The manager’s override commission was in consideration of his taking “complete responsibility for all facets in the sales display and attending to settlements of these sales.”  The sales referred to were the sales he made personally “and all sales from your Property Direct Sales Team …….”  The manager’s override was to be a payment in consideration of certain work to be done, from sale to settlement, quantified by reference to an event, namely, a sale giving rise to an agent’s commission.

1. I am satisfied on the balance of probabilities that Mr Royle was not available to fulfil the role of sales manager in the pre-settlement period.  It is clear that a deal of work was required to be done well before Mr Best and Ms Graham were committed full-time to the settlement process. That work was not supervised by Mr Royle.  He was not there.  He had not made any attempt to place himself in a position whereby he could conduct the role of sales manager before the letter of 21 February 2006 -  about three months out from settlement - prompted him into action.  His solicitor’s response dated 24 February 2006[51] asserts his availability “to attend settlement”.  It is open to infer that he considered he need do little or nothing to receive the remainder of the commission.  Indeed, that is the nature of the claim as pleaded. 

   [51] Exhibit 19

1. More than this, as proprietor of a business engaged in similar affairs to that of Property Direct, it is unrealistic to assert that Mr Royle could simply resume the manager’s role.  It is more reasonable to conclude that he had placed himself in such a position of conflict with the interests of Property Direct that he would be unable to conduct the manager’s role according to terms even remotely resembling those of the employment agreement.  He had, thus, made himself unavailable to conduct that role.

1. To consider these matters in assessing the meaning of the contractual terms and whether Mr Royle was relevantly available is not to “disregard clear words under the guise of interpreting the contract”.[52]  It is to read the agreements in accordance with the considerations referred to in Pacific Carriers Ltd v BNP Paribas.

   [52]Kooee Communications Pty Ltd v Primus Telecommunications Pty Ltd [2008] NSWCA 5, referred to by counsel for the plaintiff.

1. In the circumstances it was open to Property Direct to adjust the commission to be paid as manager’s over-ride.

1. I have reached a different conclusion with respect to the commission to be paid under the sales agent’s remuneration agreement, there being such a substantial distinction in the roles and the nature of the entitlement.  The evidence adduced as to the tasks required of an individual sales agent to carry a sale to completion does not compel a conclusion that Mr Royle was unavailable, within the meaning of the terms in the sales agent’s remuneration agreement, to perform them.

1. The entitlement to the sales commission accrued upon a contract becoming unconditional. The ‘right’ to vary it depended on the agent’s availability at settlement. 

1. The defendant’s case - that because of his position of conflict Mr Royle was unavailable to carry out settlement duties with respect the individual contracts he achieved as a seller - reduces to an assertion that he could not honour the confidence required regarding information he might gain from a buyer during pre-settlement contact or that he would steer away from Property Direct any re-sale that might arise.  Even if (which it is not necessary to find) Property Direct did not trust Mr Royle in these respects for good reason that did not make him relevantly unavailable as a sales agent.

1. Property Direct paid several former sales employees commissions. Mr Beard explained that each met with him and came to an arrangement.[53] These were individual sales persons, each in different circumstances. Whereas the evidence of these arrangements does not influence my conclusion as to whether Mr Royle was relevantly available to undertake the duties required as sales manager, it does demonstrate the practical possibility that a sales agent’s pre-settlement tasks could be performed by former employees.

   [53] 3-71

1. In the result, this part of the plaintiff’s claim succeeds.

Was the adjustment reasonable?

1. The agreement does not prescribe criteria for quantifying any adjustment. Both parties submit the contractual right to adjust the commissions carries a requirement that the adjustment be reasonable. 

1. Mr Beard said the substantial pre-settlement activity associated with the Aurora project commenced six months before settlement. The work was done by employees of Property Direct, Luke Best and Melanie Graham. They were committed, full-time, to the settlement of Aurora for about three or four months prior to settlement.  They received support from the head office of Property Direct.[54] Their engagement in Aurora matters commenced more than 12 months before settlement. 

   [54] 3-30.10

1. Mr Best and Ms Graham were paid about $14,000 in total, as Mr Beard recalled,[55] although Mr Best said he was paid about $10,000 “plus tax and super”.[56] Although this is relevant to the assessment of the reasonableness of the adjustment it is not the only criterion for judgment.

   [55] 3-36.20

   [56] 3-122.1

1. Mr Beard said also that the commitment of Mr Best and Ms Graham to the Aurora settlement caused loss of revenue on other projects.[57] He and other employees spent time, on Aurora pre-settlement tasks, which would otherwise have “been absorbed had the sales person been doing it”.[58]

   [57] 3-36.20

   [58] 3-106.55

1. Counsel for Mr Royle, noting the absence of evidence from Ms Graham, argues that in the absence of any other evidence of the cost of replacing Mr Royle, Property Direct has not established that the adjustment was reasonable. I do not draw any inference from the absence of Ms Graham as a witness. The evidence of Mr Beard and Mr Best adequately dealt with her involvement and was not in issue. Counsel for Property Direct argues that given the substantial evidence of the effort involved in the pre-settlement activities, the adjustment was reasonable.

1. It was not contested that Mr Royle capably assembled, trained and managed the sales team which numbered up to ten sales agents. The pre-settlement activities were essentially undertaken by two staff. I infer from all of the evidence that the degree of activity required to achieve the end of the first stage – unconditional contracts – was greater than that involved in settlement. Mr Foote, whom I regard as a neutral witness at least in this regard, twice proferred the opinion that the greater part of the work is done “getting a person to go to contract”.[59]

   [59] 2-94.20; 2-65.40

1. In view of all these matters, I consider the adjustment of the override commission by 50% was unreasonable and the reduction should have been limited to 35% of the amount owing. If $76,715, the amount in dispute, represents 50% of the amount that was due to Mr Royle, a further 15% of that amount would be $23,014.50. 

1. Having reached these conclusions I consider it unnecessary to deal with certain issues raised in the amended reply, namely the assertions that the adjustment made by the defendant amounted to unjust enrichment and a penalty.

1. The amended statement of claim does not plainly seek the alternative relief of an order adjusting the amount withheld by Property Direct. As set out above, this was sought at the hearing and both parties have made submissions on the point. I have proceeded on the basis that there is no opposition to the raising of the alternative claim and that there would be no opposition to an amendment to include it. As I have stated, I am minded to order an amount be paid to the plaintiff on the basis that the adjustment to the override commission was unreasonable.  I will hear from the parties before making final orders in this regard and with respect to interest and costs.