ON APPEAL FROM THE SUPREME COURT OF Principal and Agent-Authority to sell land for net sum-Right to retain excess over
that sum-Authority in writing to sell for certain sum and to retain excess -Signature obtained by misrepresentationPrincipal not able to read without MELBOURNE,
glasses-Non est factum-Action for money had and received-Money paid May 19, 20,
away by solicitor under mistake of fact-Recovery from payee-Ratification. 21; June 10.
An authority to an agent to sell property for a certain sum net does not, in the event of a sale being effected for a larger sum, entitle the agent to retain any sum in excess of the amount of his commission calculated on the usual scale.
Where money is, without the authority of the principal, paid by his agent to a third party under a mistake of fact, the money may be recovered by the principal from the third party in an action for money had and received.
Holt v. Ely, (1853) 1 El. &Bl. 795, followed. The respondent, who owned a certain property, signed a document in which it was stated that he gave to the appellant the sole offer of the property for a certain sum and that he agreed to allow to the appellant as bonus or commission any excess over that sum which might be obtained by the appellant from the purchaser. At the time of signing the respondent had not his reading glasses, without which he was unable to read, and he was induced to sign it by the representation that it was a mere authority to sell.
Held, that the respondent was not bound by the document.
A sum of money having, without the respondent's authority, been paid by the respondent's solicitor to the appellant under the erroneous belief that the respondent had agreed to pay it to the appellant,
Held, by Knox C.J., Higgins, Rich and Starke JJ. (Isaacs J. dissenting), that in the circumstances of the case the respondent had not ratified the payment, and might recover the sum from the appellant.
Decision of the Supreme Court of Victoria (Full Court): Taylor v. Smith, (1926) V.L.R. 100 47 A.L.T. 122, affirmed.
APPEAL from the Supreme Court of Victoria.
An action was brought in the County Court at Melbourne by Henry Norbert Taylor against Sydney Wentworth Smith in which the defendant, by counterclaim, claimed, (inter alia) as money had and received to the use of the defendant, the sum of £387 10s., being the difference between £500, part of a sum of £4,500, the price of certain flats of the defendant which had been sold through the agency of the plaintiff, and £112 10s., the usual commission on a sale for that amount. The County Court Judge found for the defendant on the counterclaim, and, on appeal to the Supreme Court, the Full Court upheld his decision: Taylor v. Smith 1.
From the decision of the Full Court the plaintiff now appealed to the High Court.
The material…
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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AGLC
Taylor v Smith [1926] HCA 16
Case
[1926] HCA 16
Decision Date
CaseChat Overview and Summary
The appeal concerned Henry Norbert Taylor (appellant) and Sydney Wentworth Smith (respondent), arising from a property sale where Taylor acted as the respondent's agent. The dispute centred on a sum of £500, which the appellant retained from the sale proceeds of £4,500, significantly exceeding the usual commission. The respondent counterclaimed for this amount, arguing it was money had and received by the appellant to his use. The case was heard in the County Court, appealed to the Supreme Court of Victoria, and subsequently appealed to the High Court of Australia.
The High Court was required to determine two primary legal issues. Firstly, whether the respondent was bound by a written document authorising the appellant to retain any excess over £4,000 as bonus or commission, given the respondent's claim of misrepresentation and inability to read the document without his glasses. Secondly, the Court had to consider whether, even if the payment of the £500 was unauthorised, the respondent had subsequently ratified this payment, thereby precluding recovery.
A majority of the High Court, comprising Knox C.J., Higgins, Rich, and Starke JJ., affirmed the decision of the Supreme Court of Victoria. They held that the respondent was not bound by the written document due to the circumstances of its signing, which supported a plea of *non est factum*. The Court found that the respondent was induced to sign by a misrepresentation that it was a mere authority to sell, and he was unable to read it without his spectacles. Furthermore, the majority concluded that the respondent had not ratified the payment of £500 by his solicitor, Mr. Serle, to the appellant. They reasoned that the respondent lacked full knowledge of the material circumstances surrounding the payment, particularly the fact that Serle made the payment under a mistake of fact. Consequently, the respondent could recover the sum from the appellant in an action for money had and received, following the principle in *Holt v. Ely*. Isaacs J. dissented, finding that the respondent's conduct, including his response to the solicitor's account and subsequent actions, constituted ratification of the payment.
The appeal was dismissed with costs. The High Court upheld the Supreme Court's decision, meaning the respondent was entitled to recover the £500 from the appellant.