Auction — Entitlement to commission — Commission payable in the event of any sale — Property sold before sale by different agent — Whether commission clause a penalty
The defendant instructed Edwin Evans & Sons to sell his property, and a purchaser introduced by that firm failed to complete the sale. Without withdrawing his instructions to this firm, the defendant in December 1985 then requested the plaintiff auctioneers to sell by auction. The terms of business were signed on the defendant’s behalf by his wife. Clause 1 of the plaintiffs’ terms provided that a commission of 2.2% (reduced to 2% in the instant case by an amendment), subject to a minimum of £150, be payable in the event of any sale between the giving of instructions and the expiration of 28 days after the auction date. Clause 3 provided for a fee of £200 if the property was withdrawn between the giving of instructions and the auction. Clause 15 provided for the auction date, which in fact was left as a blank.
The plaintiff auctioneers did not get the property into their January sale but informed the defendant’s solicitors that it would be in the February sale. On January 15 1986 Edwin Evans & Sons sold the property and received their commission. The plaintiffs sought to recover their commission under clause 1.
Held The county court judge was wrong in holding that clause 1 applied only to the January sale and that, as there had been a constructive withdrawal of the property, the only commission payable was under clause 3. The facts amounted not to a constructive withdrawal but to a new sale which fell within the provisions of clause 1. The provisions of clause 1 were common in auctioneers’ terms and could not be regarded as a penalty.
Bernard Thorpe & Partners v Snook
[1983] EGD 77 considered.
Jeffrey Burke QC and Colin Wynter (instructed by LB Marks & Co) appeared on behalf of the appellants; and R Paul Stewart (instructed by Corsellis Church Rackham) appeared on behalf of the respondent.
