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Wells (Respondent) v Devani (Appellant)

Wells (Respondent) v Devani (Appellant)

Case [2019] UKSC 4 13 February 2019

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Hilary Term

[2019] UKSC 4

On appeal from: [2016] EWCA Civ 1106

JUDGMENT

Wells (Respondent) v Devani (Appellant)

before

Lord Wilson

Lord Sumption
Lord Carnwath
Lord Briggs
Lord Kitchin

JUDGMENT GIVEN ON

13 February 2019

Heard on 11 October 2018

Appellant Respondent

Andrew Warnock QC

Andrew Butler QC

David Giles Edward Blakeney
Laura Giachardi

(Instructed under the Bar	(Instructed by Wedlake
Council’s Direct Access	Bell LLP)

Rules)

LORD KITCHIN: (with whom Lord Wilson, Lord Sumption and Lord
Carnwath agree)

1. In this case an estate agent claims that commission became payable to him by the vendor of a number flats on the completion of the sale of those flats to a purchaser which he had introduced to the vendor. It gives rise to two issues. The first, raised on appeal by the agent, concerns the agreement between the agent and the vendor and whether it was complete and enforceable by the agent despite there being no express identification of the event which would trigger the obligation to pay the commission. The second, raised on a cross-appeal by the vendor, concerns the application of section 18 of the Estate Agents Act 1979 and whether, by reason

of the agent’s failure to comply with the requirements imposed by the Act, the trial

judge ought to have dismissed the claim or discharged the vendor’s liability to pay

the commission.

The facts

2. In 2007, the defendant, Mr Wells, a retired stockbroker’s office

administrator, completed the development of a block of flats in Hackney under the terms of a joint venture agreement with Mr White, a builder. By the beginning of 2008 six of the flats had been sold, one was under offer and seven were still on the market. They were being marketed by a local agency, Shaw & Co, under a contract for a sole agency and a commission of 1.75%, or 3% if the properties were sold through another agent.

3. In late January 2008, Mr Wells mentioned to Mr Nicholson, a neighbour in Andorra, where they both lived, that he was having difficulty selling the remaining flats. Mr Nicholson told Mr Wells that he knew of a property investment company in London that might be interested in purchasing the flats and Mr Wells responded that he would be happy for Mr Nicholson to make some enquiries.

4. On 29 January 2008, Mr Nicholson sent an email to the claimant, Mr Devani, who was trading as an estate agent in Kilburn, informing him of the flats and that

seven remained unsold. He also gave him Mr Wells’ and Mr White’s telephone

numbers and explained that Mr Wells would be coming to London very soon.

5. Later that day Mr Devani acknowledged receipt of Mr Nicholson’s email,

thanked him and told him that the information he had been given might well be of interest. He also made a telephone call to Mr Wells in Andorra. The parties at trial gave strikingly different accounts about what was said in the course of this…

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 Wells (Respondent) v Devani (Appellant)

Details

AGLC: Wells (Respondent) v Devani (Appellant) [2019] UKSC 4
Case: [2019] UKSC 4
Decision Date

CaseChat Overview and Summary

In the Supreme Court, Mr Devani appealed against the decision of the Court of Appeal which had dismissed his claim for commission for the sale of a block of flats. Mr Devani had introduced a purchaser who had purchased the flats. The Court of Appeal had found that there was no binding contract between Mr Devani and Mr Wells, the vendor of the flats, because there was no express agreement as to the event which would give rise to the entitlement to commission. The Supreme Court found that, in the absence of an express agreement, it would naturally be understood that payment of commission would become due on completion of the sale and be made from the proceeds of sale. The Supreme Court found that there was a binding contract between Mr Devani and Mr Wells. The Supreme Court also found that it was open to the trial judge to imply a term into the agreement between Mr Devani and Mr Wells to give the contract business efficacy. The Supreme Court found that the trial judge had not erred in finding that the failure of Mr Devani to comply with the Estate Agents Act 1979 did not justify dismissing his claim for commission. Instead, the commission payable to Mr Devani should be reduced by one third. The Supreme Court allowed Mr Devani’s appeal and dismissed Mr Wells’ cross-appeal.

Orders