Claim for commission on the sale of a house made by a person who was not a professional estate agent but described as an ‘entrepreneur’ — Appeal against rejection of this claim by deputy judge — A tangled story full of strange incidents, in one of which the eventual purchaser, an Arabian princess, was being shown round the house in question on the same occasion by representatives of two different agents who were in competition with one another but neither of whom knew the precise identity or status of the princess — Difficult question as to who was the effective cause of the sale — Court of Appeal differ from conclusion reached by trial judge — No evidence, in their view, to support judge’s finding that the effective cause was negotiations which the vendor had been carrying out with another member of the Saudi royal family on behalf of the princess — Effective cause was an introduction made by the ‘entrepreneur’, the plaintiff in the action and appellant in the present appeal — Appeal accordingly allowed
This was an
appeal by Desmond Lawrence Bloom from a decision of Mr Piers Ashworth QC,
sitting as a deputy judge of the Queen’s Bench Division, rejecting his claim
against the defendant, Simon Yefet, for commission in respect of the alleged
introduction of a purchaser of the defendant’s property at 17 Hyde Park
Gardens, London W2. The property was purchased by the Princess Noura Bint
Abdulla Bin Abdulrahman AI Saud at the price of £1.35m.
William R Rose
(instructed by Maxwell & Gouldman) appeared on behalf of the appellant; the
respondent, Simon Yefet, appeared in person.
Giving the
first judgment at the invitation of Stephenson LJ, ACKNER LJ said: In 1976 Mr
Simon Yefet, who is the defendant in the action and the respondent in this
appeal, bought a leasehold interest in 17 Hyde Park Gardens in Bayswater. These
are palatial premises, said to contain some 14 bedrooms, eight bathrooms and,
inevitably, many other spacious rooms as well. He bought the premises as an
investment; he intended to, and in fact he did, spend a large sum of money —
the papers indicate £150,000 or more — on furnishing and decorating the
premises in a manner which would be likely to appeal to likely purchasers,
namely, someone very wealthy from the Middle East.
He converted
his short lease of some 14 years into a long lease. The freehold was owned by
the Church Commissioners and according to the facts, very fully and admirably
set out by Mr Piers Ashworth QC, sitting as a deputy High Court judge, the
figure agreed initially, in 1976, was £300,000 for the long lease, but the
purchase was not effected until three years later, when the asking price had
gone up to £1/2m. So, as I have indicated, Mr Yefet purchased his initial
leasehold interest in 1976, intending to sell the premises, refurbished and
with a longer interest.
He in fact
achieved what he set out to do some three years later, in 1979, when he
effected a sale to Princess Noura Bint Abdulla Bin Abdulrahman Al Saud, the
sister of Prince Khalid, for the sum, not of £2m, which is what he had hoped to
get, but £1,350,000.
The issue
which arises in this case is: Was the plaintiff, Mr Bloom, who is described as
an entrepreneur with substantial contacts in the Middle East, the effective
cause of that sale?
Mr Bloom met
the defendant in 1978; it was a meeting arranged by the defendant’s nephew, Ben
Yefet. There was a dispute as to whether, following or during that meeting, an
agreement was reached between Mr Yefet and Mr Bloom. The judge held that, while
accepting that both witnesses were entirely honest, he preferred the
recollection of the plaintiff, and he was satisfied that that meeting resulted
in an agreement under which the plaintiff was to receive 3% of the sale price
if he introduced a purchaser who purchased the property — in other words, if he
was the effective cause of a sale of the property.
In the summer
of 1978 the defendant, who knew the Saudi royal family, negotiated with Prince
Khalid with a view to the sale to him, or to anyone the prince had in mind, of
the property. Apparently the prince indicated that he was not personally
interested, but that perhaps a brother or a sister of his might be. But the
negotiations got nowhere and between September 1978 and October 1979 they
dragged on and were described by the learned judge as being ‘desultory’.
Meanwhile Mr
Bloom, unsuccessfully but energetically, was trying to find purchasers, and in
his attempt to be successful he got in touch with a firm of estate agents,
Wilson Mordant & Sons, and arranged with them that they would share the
commission if he or that firm were successful in selling the property.
There were
other agents also instructed, not through Mr Bloom but by Mr Yefet, but we are
not concerned with them. We are concerned with one other firm, Chestertons; I
shall seek to explain how they came into the story in a moment.
So early in
1979 Wilson Mordant & Sons came on the scene. In October 1979 Princess
Noura came to England. She had previously been married to Prince Turkey, but
that marriage had been dissolved.
I now come to
the important dates. On October 9 a Mr Shbeeb, a Jordanian, got in touch with
Wilson Mordant, and the judge accepted that he asked them whether they had any
particularly luxurious properties on their books because he knew of someone who
was interested. Among other properties, they mentioned 17 Hyde Park Gardens,
and an appointment was made through Mr Bloom to view those premises on October
12. On that day Mr Shbeeb met Mr Bloom at the offices of Wilson Mordant &
Sons; he also took with him Mr Alami, who was the financial adviser either to
Princess Noura or to her erstwhile husband, Prince Turkey, or both. They
collected from the Grosvenor House Hotel, where the princess was staying, the
princess and her two daughters. They went to the properties which the agents had
mentioned, ultimately arriving at 17 Hyde Park Gardens. Also at 17 Hyde Park
Gardens was Mr Cunliffe-Lister of Chestertons. He was there as a result of
being instructed by Colonel Ishmail, who was the military attache to the Saudi
Embassy. The learned judge asked himself, understandably, how this came about,
and he came to the conclusion, although there was no precise evidence about it,
that the princess or someone on her behalf had arranged the appointment.
The learned
judge made a surprising finding, but one which is in no way criticised by
either party. It was that both agents — that is,
other — both, independently of each other, showed the party round, and that the
princess was effectively in the company of both agents on that day. He also
said that neither agent knew the precise identity, nature or status of the
princess, although they thought that she may well have been a princess from
Saudi Arabia. The defendant himself was not in the premises; he was outside and
he did not recognise her, not having met her, apparently, before. It seems to
have been the general impression at that time and shortly thereafter that
nothing would come of this particular occasion.
But they were
wrong. Either on the night of October 12 or 13 Mr Shbeeb, whose honesty made no
impact upon the learned judge to put it mildly, met the defendant and pretended
that he was the sole person responsible for the princess having been introduced
to the property, and as a result of his assurances to the defendant the
defendant agreed to give him, and in fact gave him, £10,000. The defendant then
discovered who in fact the princess was; knowing then that she was the sister
of Prince Khalid; he approached the prince and negotiated with him a price,
having of course established that the princess was wishing to purchase the
property as her home. As a result of his negotiations the price was fixed at
the figure I have mentioned, £1,350,000. As I have indicated, Princess Noura
was not known to the defendant before the sale, so the learned judge found, and
they had never met.
The judge
therefore had to ask himself, and quite correctly did ask himself, was Mr Bloom
the effective cause of the sale having, together with the agents with whom he
acted and to whom he would owe half the amount he claims if he were successful,
introduced the princess to the property, and if so, was that introduction the
effective cause of the sale?
The learned
judge, having posed the question, said:
It is
submitted by Mr Ellis on behalf of the defendant that whatever the position be
generally where there are two agents, this was not an introduction by the
plaintiff . . . of the princess to Mr Yefet, because the princess’s existence
was already known to Mr Yefet, and Mr Yefet was negotiating with Prince Khalid
on her behalf, and that at the very highest what Mr Bloom did was to bring to
the property of Mr Yefet, through yet another agent, Mr Shbeeb on this
occasion, the princess, a person with whom Mr Yefet was already in negotiation
That long
sentence needs to be split into at least two sections.
The learned
judge said in that sentence that the princess’s existence was already known to
Mr Yefet. If he merely meant by that, as I think he must, that Mr Yefet knew
that Prince Khalid had a sister, in my judgment it does not advance the matter
to any degree. I think that is all he meant to say, because he had made the
earlier finding in these terms:
The person to
whom the house was sold, Princess Noura, had not been personally known to Mr
Yefet and had never met Mr Yefet before the sale. As far as I know, she has
never met him now.
The second
part of the sentence contains the statement that Mr Yefet was negotiating with
Prince Khalid on her behalf. There is no evidence in this case that establishes
that fact. I have every sympathy with Mr Yefet in his difficulties in getting
to court evidence from the royal family. No doubt it is more difficult,
assuming it is possible, to get the evidence of Prince Khalid to court than
perhaps the princess; but there are means of putting in written statements from
persons, particularly when they are not parties, where the situation is such
that there are great difficulties in getting them personally to court. Whether
or not that approach was explored, we know not. We have to decide this case on
the evidence which was before the learned judge and there was, as I understand
the case, no evidence that Mr Yefet was negotiating with Prince Khalid on
behalf of the princess, before the princess came and visited the house. He had
negotiated with Prince Khalid, who had indicated that he himself was not
personally interested, but that a member of his family, unidentified, might be,
and those negotiations had by October 1979 dwindled into nothing.
Shortly then,
the situation was this: the evidence before the learned judge was that Mr Bloom
and his estate agent colleagues had been asked by someone on behalf of the
princess to provide particulars of luxurious premises on their books, and they provided
17 Hyde Park Gardens. Secondly, that having provided 17 Hyde Park Gardens, they
took the princess to the premises and showed her round; that very shortly
thereafter the sale took place to the princess despite the history of
unsuccessful negotiations with her brother extending over more than a year. In
the absence of any evidence as to the princess’s prior knowledge of these
premises, what is the proper inference that can be drawn from that simple
situation?
In my judgment
it is that the property suggested to the princess to be viewed by her, namely,
17 Hyde Park Gardens, found sufficient favour in her eyes when she went round
the premises to make her willing for them to be acquired for her as her house.
Accordingly, when the defendant knew her identity and therefore knew that the
person who would be dealing with the financial side was likely to be her
brother, he had little difficulty in concluding a contract on her behalf,
although he had to bargain, no doubt effectively and efficiently, as to what was
the price which should be fixed. In those circumstances, with respect to the
learned deputy judge’s decision, I cannot accept that Mr Bloom and his
colleagues were not the effective cause of that sale. In my judgment they
provided a strong prima facie case on the basis of the material which I have
just summarised, and there was no evidence to contradict it.
In those
circumstances I consider that they have discharged the onus which is upon them
and accordingly I would allow this appeal, taking the view that Mr Bloom is
entitled to the sum which he claims, although (and this is common ground) one
half thereof is owing, or will be owing, to his estate agent colleagues.
Accordingly, I
would allow this appeal:
Agreeing, SIR
SEBAG SHAW said: I add a few observations in deference to the learned judge. He
dealt with a difficult situation with the greatest of care. He has indicated in
clear terms his views as to the credibility of the individual witnesses and as
to the weight and effect of their evidence.
His primary
findings of fact have not been attacked; indeed, they were immune from any
criticism. The basic difficulty was the absence of what, in a case of this
kind, would normally be the critical evidence to support or to defeat the
plaintiff’s claim. The principal party concerned, namely, Princess Noura,
through nobody’s fault, was not available to give evidence at the trial.
Starting with
the learned judge’s findings of primary fact, it seems to me that in what was a
very tentative situation the right conclusion is that the plaintiff did
discharge the onus upon him of showing that it was his activity in this matter
which in the end brought about the sale to the princess.
Even though
Prince Khalid had been negotiating ostensibly on behalf of the princess with Mr
Yefet, no result appears to have been achieved. The negotiations, according to
the learned judge, had been pursued in a desultory fashion for a long time.
Once the learned judge rejected the evidence of Mr Shbeeb virtually in its
entirety the way was clear for the inference that, but for Mr Bloom, the visit
to the premises would not have come about. That, on the basic findings of the
learned judge, was the decisive factor in bringing about the selling of the
property to the princess.
Mr Yefet, who
in this court has put his case succinctly but effectively, may well be under
the sincere belief that the ‘runners’ clustered round in large numbers seeking
reward. It may have been very difficult to see which, if any of them, was
entitled to a share of the booty. However, what does emerge, as it seems to me
clearly enough from the picture described by the learned judge, was that Mr
Bloom’s intervention brought about the sale.
I, too, would
allow this appeal.
STEPHENSON LJ:
I agree with both judgments that have been delivered, and that the appeal
should be allowed.
The appeal
was allowed with costs in the Court of Appeal and below.
