Sale by auction–Property fails to reach reserve price, but sold very shortly afterwards by private treaty–Auctioneer held to have had authority to sell by private treaty in a case in which parties who needed money to clear up debts left the conduct of the sale to solicitors
This was a
claim by Mr Albert Walker Garnier, of 8 Queen Street, London EC4, and Mr
Alastair Hocken Bonar Matthews, of 147 High Road, Loughton, Essex, trustees of
a settlement created by Victor Ernest Farley on September 19 1966, against Mr
Cyril Frank Bruntlett, of Hansard Drive, Wragby, Lincolnshire; Mr John Robert
Bruntlett, of Stainton Lane, Langworth, Lincolnshire; and Mr Norman Sidney
Bruntlett and Mr Geoffrey Arthur Bruntlett, both of Hall Farm, Goltho,
Lincolnshire; for specific performance of a contract made after an auction on
April 28 1972 for sale of Hall Farm for £38,000, alternatively damages. In the
further alternative, the plaintiffs claimed against Mr Richard James Walter
Morris, trading as H H Morris, estate agent, of Market Rasen, Lincolnshire,
damages for breach of warranty of authority.
Mr M Browne QC
and Mr J Child (instructed by Kingsford, Dorman & Co, agents for Attwater
& Liell, of Loughton) appeared for the plaintiffs; Mr M Lloyd (instructed
by Anthony T Clark & Co, of Lincoln) for the first defendant: Mr J W Mills
QC and Mr R Potts (instructed by Collyer-Bristow & Co, agents for Larken
& Co, of Newark) for the second, third and fourth defendants; and Mr J
Parker (instructed by Lee, Bolton & Lee, agents for Roythorne & Co, of
Spalding) for the fifth defendant.
Giving
judgment, WHITFORD J said: The question which arises in this action is whether
or not there was a sale of property, Hall Farm, Goltho, Lincolnshire, or
whether in fact in the circumstances in which the alleged sale took place there
was effectively no sale. The plaintiffs are the trustees of a settlement made
by one Victor Ernest Farley. It emerged in the evidence, though it is of no
direct relevance to the matters in issue, that the trust in question has at one
time or another been concerned with farm property. The trust has farmed certain
property itself, and has had other properties farmed by a company with which Mr
Victor Farley has been associated. The plaintiffs, after consultation with Mr
Victor Farley, having heard that Hall Farm, a property of some 157 acres, was
coming up for sale on April 28 1972, decided that a bid should be made to
purchase this property, and Mr Farley was authorised by the trustees to attend
the sale, which was to be by auction, and to purchase this property if he could
get it for a sum not exceeding £40,000.
Hall Farm is a
farm with which a family by the name of Bruntlett has been associated for a
good many years. The first four defendants, Cyril Bruntlett, John Bruntlett,
Norman Bruntlett and Geoffrey Bruntlett, were trustees of their father’s will,
their father having in fact farmed Hall Farm as a tenant. It appears, though
here again it is of no direct relevance to the matters in issue, that after his
death arrangements were made by which the property was purchased, in part no
doubt with assets from the father’s estate, and in part through a loan provided
by the Agricultural Mortgage Corporation. These transactions were the subject
of discussion among the family, which included, after the father was dead, in
addition to the four brothers who are the first four defendants, the widow,
that is the mother of the first four defendants, another son, Kenneth, and a
daughter. An agreement was reached among the family. It was envisaged that Mr
Norman Bruntlett and Mr Geoffrey Bruntlett would farm Hall Farm after it had
been purchased, but there was provision under which there was a power in the
trustee to sell, and it was envisaged that this should be exercised if Mr
Norman Bruntlett and Mr Geoffrey Bruntlett should give up farming the property.
Regrettably, difficulties arose, and some little time before the events leading
up to the sale occurred, a position had been reached in which it was no longer
possible to meet the outstanding repayments to the Agricultural Mortgage
Corporation. Over and above that it appears that Mr John Bruntlett, known in
the family as Jack, had lent quite a considerable sum of money–something of the
order of £6,000 or £7,000–to try to assist his brothers in their farming the property;
so in the result it emerged that by 1972 it was realised that it was impossible
for matters to continue as they had been going in the past, and that a sale was
inevitable.
There were
further discussions in the family. In substance, at this stage, there were two
alternative possibilities open. The first of these was that Mr Jack Bruntlett
should see if he could secure the finance to purchase the farm. I should say in
passing that so far as the farming side of the matter is concerned he seems to
have been the more effective member of the family. The other alternative was
that the property should be sold on the open market for such a sum as would
cover the outstanding liability by way of mortgage and the loan made by Mr Jack
Bruntlett, and it was hoped that some money would be in hand. I think it is
plain that these family discussions, as is not altogether uncommon, were
inevitably discussions in which there had to be some degree of compromise,
because the views of different members of the family as to what was the best
course to adopt were at variance. I think it is plain that Mr Jack Bruntlett,
Mr Norman Bruntlett and Mr Geoffrey Bruntlett were most anxious, if it were
possible, that the property should be retained within the family. Mr Cyril
Bruntlett, the first defendant, who was I think the eldest of the family,
thinking no doubt in particular of the interests of his other brother, his
sister and his mother, was desirous that whatever happened the matter should be
cleared up so that the estate was no longer encumbered with a property which
was just
it is plain that by February 18, following a discussion which had taken place
among the members of the family, a decision had been reached to seek advice as
to what price it might be expected Hall Farm would make on the open market. The
question also arose at this time as to whether or not another adjacent property
and other buildings should be sold. In fact, it does not appear that any steps
were taken to dispose of this additional property, but in any event a letter
was sent on February 18 1972 to a Mr R J W Morris, an estate agent, who is the
fifth defendant, asking him to give valuations for the farm and this other
property so that the family might then consider their position yet again and
come to some conclusion as to what had best be done. On February 23 Mr Morris
wrote back. He had not been asked to carry out a detailed valuation. He had
been asked to give some sort of estimate, which he did reasonably promptly, and
he assessed the current value of the 157-odd acres comprising Hall Farm as
being in the order of £37,000. This estimate having been received, there was a
further meeting of the family. Again, I think they may not have been in
complete accord, but I have no doubt whatsoever that this decision was reached,
namely that the property must be sold.
The letter of
inquiry which was sent to Mr Morris was sent by a firm of solicitors, Langleys,
who had been advising the trustees and the family generally; I think they had
been solicitors to the Bruntletts for a good many years. At the time when the
decision was reached that there must be a sale it appears to have been
considered that as there was perhaps some division of interest within the
family, for it will be recalled that it was Mr Cyril Bruntlett, acting as
trustee and considering the interests of his youngest brother and sister and
mother, who had been pressing for a sale, it was thought right that that side
of the family should be separately represented, and they in fact instructed
another firm of Lincoln solicitors, Anthony T Clark & Co. Following this
further discussion, letters were sent by Langleys and Anthony T Clark to Mr
Morris, giving him joint instructions to sell by public auction. Particulars
were prepared of the property in question, which involved a certain amount of
discussion between Mr Morris and the second defendant, Mr Jack Bruntlett. A
date was fixed for the sale, April 28 at 2.30 at the Corn Exchange in Lincoln.
One question which had not been considered, apparently, at the meeting when the
decision was taken by the family to put the property up for sale was what the
reserve price should be. A Mr Childs of Langleys had always had this in mind,
that if the property was to be sold it should only be sold for such sum as
would effectively discharge the outstanding obligations, something in excess of
£35,000. Mr Morris had advised that its value was of the order of £37,000 on
the then existing values for land. And there is no doubt, because there is no
dispute upon the evidence about this, that on the day of the sale, at a meeting
at Langleys which was attended by a Mr Phillips and a Mrs Wellman, also of
Langleys, and Mr Morris, and a Mr Clark or at least by a representative of
Anthony T Clark & Co, a decision was taken that the reserve price should be
fixed at £38,000.
I must now
relate certain of the circumstances of the sale, and the account which I shall
give of the sale is that which was given by Mr Victor Farley, who was called on
behalf of the plaintiffs. In substance, the evidence that he gave relating to
the circumstances of the sale was confirmed by all the other witnesses in the
respects which I shall now relate. In so far as there are aspects of the case
which are the subject of dispute upon the evidence, I shall return to deal with
those later. Mr Farley went to the sale. Mr Morris read out certain detailed
particulars of the property, and indicated certain amendments which as a result
of subsequent events had come to light. Mr Phillips, of Langleys, read out the
conditions upon which the sale would be made. Mr Morris then opened the
bidding. Mr Farley took the view, and all the other witnesses agreed with him,
that there appeared to be no genuine bids. Mr Morris did what he could, but
having taken the property up to £37,500, and there being no genuine bid and
that being below the reserve, he withdrew it from the sale. He then invited any
interested person who was present and who might wish to make further inquiries
about the property to make an approach to him, indicating that he would remain
behind for a short period for this purpose. Those present at the sale, and the
numbers present varied according to the evidence of the witnesses from about 50
to I think about 80, then dispersed. The sale had in fact taken place in a room
which was known as the ‘far end room’ in the Corn Exchange. To reach this room
you had to go through the main body of the Corn Exchange, which is apparently
busy on Fridays–that being a market day–and in which a number of surveyors and
auctioneers have stands. Mr Farley went outside and discussed the auction with
another auctioneer, whom he knew and with whom he had previously done business,
with a view I think to ascertaining, if he could, what price the property might
be purchased for. This was a Mr Moore, who also gave evidence confirming Mr
Farley’s account of what next took place. What apparently happened was that an
approach was made to Mr Morris with an offer of £37,000. Mr Morris indicated
that he would be prepared to accept £38,000. This was within the limit which Mr
Farley had agreed with the plaintiff trustees, and he decided to close at this
figure. He told Mr Morris that he was prepared to purchase for £38,000. They went
back into the far end room, from which Mr Morris had emerged during the
discussions. A form of contract was produced, and it is one of the agreed
documents in the case, being no 2 document. It was a form prepared for the
purpose of the auction. The agreed purchase price of £38,000 was filled in, and
Mr Farley indicated that he was prepared to provide a cheque for the deposit in
the sum of £3,800, which he did. Mr Morris informed him that it should be made
out in the name of Langleys, the solicitors to the trustees, and this was done.
Mr Morris then signed this document on the face of the document as agent for
the vendors, and Mr Farley signed the document. So far as Mr Farley was
concerned the transaction was then at an end, and he left the auction room confident
that he had in fact purchased this property for the sum of £38,000.
There are
certain other matters which are not in dispute on the evidence. Among them is
this, that the first four defendants were all present at the auction, and they
confirmed the account of events which I have given up to the time when Mr
Morris withdrew the propery and invited persons interested to come to him while
he was still present in the Corn Exchange. At this stage it appears that they
left. The solicitors were also present, and they too stayed for a short time
after the auction. I shall have to come in more detail to the account of what
it is said took place between Mr Morris and the solicitors, but at any rate
they were not there when the contract was actually signed. Mr Farley, as I have
said, was quite certain that he had purchased this property. Mr Morris was
equally certain that he had sold it. And there is no doubt, though there is
some dispute as to the terms in which the disclosure was made and as to what
subsequently ensued, that Mr Morris informed both Langleys and Mr Jack
Bruntlett that evening of what had transpired. I think it is quite plain that
Mr Jack Bruntlett, Mr Norman Bruntlett and Mr Geoffrey Bruntlett were not
altogether happy with the result of the sale. In fact, their evidence as to
their immediate reaction as to the way in which the news was conveyed to them
was not wholly consistent in these respects, as in other respects. What it
amounted to, however, was this. Again I think Mr
Hall Farm should have fetched £40,000. At some stage it is quite plain that
these three defendants, relatively shortly after the alleged sale had taken
place, came to the conclusion that they were minded to challenge the sale if
this were possible. One of the reasons why they were so minded was that, as
appeared from his evidence, Mr Jack Bruntlett had always been most anxious to
farm the property. Mr Jack Bruntlett took the view, according to his evidence,
that it might be possible for him to raise a sum of £40,000; and in effect, he
having taken this view of what he might possibly do, I think he had come to the
conclusion that the farm, if it were not going to him for this price, at least
should not go to anybody else for any smaller sum.
So far as the
correspondence is concerned, the first thing that we learn from the agreed
bundle after the sale is that the solicitors acting for Mr Farley, no doubt
taking the view that the sale had been concluded, wrote on May 1 making some
inquiries as to title and so on. It appears that at some stage shortly
thereafter, within a week or so, there must have been some telephone
conversations between Langleys and Mr Farley’s solicitors indicating that there
might be some difficulty; but on May 9 Langleys did send certain documents
relating to this property to Mr Farley’s solicitors, in particular a copy of
the contract. On May 11 Mr Farley’s solicitors made their position quite plain,
which was that they took the view that there had been a binding contract for
sale and that they expected the searches to go forward. Nothing more appears on
the correspondence until May 19, when the plaintiffs’ solicitors were again
pressing for some action in this matter, which they did not get. On May 23
1972, however, Langleys wrote to Mr Farley’s solicitors replying to their
inquiries and saying that they felt that at this stage they must write without
prejudice, for the reason that two members of the Bruntlett family, being two
of the trustees concerned in the sale of the farm, had consulted Calthrop &
Leopold Harvey of Spalding about the sale, and that Langleys had had some
discussion with Calthrop & Leopold Harvey, as a result of which they
understood that the sale was to proceed, but they were unable to take any steps
in this matter until Langleys had received official confirmation that the sale
should proceed. They had at this time had, of course, the cheque for the
deposit which Mr Farley had made out, but they had merely been holding this,
and had never taken any action to cash the cheque. One of the strange features
of this case is that in the period immediately subsequent to the sale, when
doubts had in fact arisen, little was said to the plaintiffs’ solicitors, still
less to Mr Morris. Now there is some dispute upon the evidence as to what may
have taken place between Mr Morris and Mr Jack Bruntlett. Mr Morris in his
evidence stated that in the week immediately following the sale he had received
some inquiry by telephone as to who had authorised the sale price at £38,000,
to which he gave the reply, ‘Langleys.’
But thereafter nobody seems to have told him anything, and we find that
he is writing letters of inquiry as to exactly what is causing the delay in
completion of the sale until the autumn of that year, throughout a period in
which it must in fact have been known, one would have thought, if a decision
had in fact been reached to challenge his authority in this matter, that his
authority was going to be challenged. This fact, however, was never disclosed
to Mr Morris until it emerged upon the pleadings.
The defence in
the action, which was originally only the defence of the second, third and
fourth defendants, because the first defendant was not concerned until
immediately before the trial of this action to join with the three others,
recites in terms, and the matter is not entirely without significance, although
it is of no direct relevance to the final result as events have turned out,
that Mr Morris was employed as auctioneer to sell Hall Farm subject to a
reserve price of £38,000; that the property was offered for sale on April 28
and as no bids were received it was withdrawn from the auction; that some
thirty minutes afterwards (and the exact period of time is not I think in the
result of any relevance) Mr Morris purported to agree with Mr Farley for the
sale of the property as agents for and on behalf of the defendants; that Mr
Morris was employed on terms only to sell by auction and possessed no
authority, express or implied, to sell the property otherwise than by way of
public auction; coupled with a denial that the contract in question was signed
by Mr Morris as agent for and on behalf of the defendants. There is also an
incidental denial that a deposit was paid to Mr Morris as agent for the
defendants or had ever been accepted by them. In the face of this defence, the
plaintiffs amended their statement of claim to join Mr Morris as defendant–they
having started this action to procure specific performance of the agreement–alleging
by their amended pleading that in entering into and executing the said
agreement he purported to act as agent for and on behalf of the remaining
defendants. And as an alternative to their claim for relief by way of specific
performance the plaintiffs, claim against Mr Morris, damages for breach of
warranty of authority.
I think it is
necessary to consider the evidence relating to two major issues in this case,
and the first is the question of the reserve price. If I do not go into this in
any very great detail, that is for this reason: the evidence of Mr Morris and
Mr Childs is in complete agreement to this extent, that they decided, at the
meeting at Langleys at which Langleys and A T Clark and Mr Morris were present,
that £38,000 was fixed as the reserve. The evidence of Mr Jack Bruntlett is, or
was at one stage, that he in fact never agreed to a reserve price of £38,000
but was only prepared to agree to a reserve price of £40,000; and his evidence
on this point was echoed, if I may say so somewhat faintly, by Mr Norman
Bruntlett and Mr Geoffrey Bruntlett. In fact, it was the evidence of Mr Morris
that he informed Mr Jack Bruntlett as to what he was proposing on the morning
of the sale. On his way to the meeting at Langleys’ office at which the reserve
price was to be fixed he called on Mr Jack Bruntlett, and at this point the
evidence of Mr Jack Bruntlett and Mr Morris is in conflict. In
examination-in-chief Mr Jack Bruntlett said that when he was told by Mr Morris
that there was to be a meeting at the offices of Langleys to fix the reserve
price he, Mr Jack Bruntlett, told Mr Morris that he required a reserve of
£40,000. He said that when he went to the auction, as he had told Mr Morris he
would, he was never in fact informed what decision had been reached with regard
to the reserve price. In cross-examination he said initially of paragraph 4 of
the defence: ‘It is not right so far as I am concerned. If Mr Phillips fixed
it, it was without my authority. I had only one price in mind, and that was £40,000.
If the hammer had gone down at £40,000 I would have been content, but not at a
lower price. £38,000 was not authorised by me.’
Mr Norman
Bruntlett, when he was dealing with this particular issue, said in
examination-in-chief that he did not know what the reserve price was but that
he understood that Jack (that is his brother, Mr Jack Bruntlett) had told Mr
Morris that it was to be £40,000 and nothing less. Mr Norman Bruntlett was at
the auction. He cannot recall that any information was given to him at the
auction as to what reserve price had been fixed, though he accepted that a Mr
Daniel, who attended on behalf of A T Clark, and who undoubtedly spoke to him,
may have mentioned the reserve price. There is no doubt that Mr Daniel did tell
Mr Cyril Bruntlett what the reserve price which had been fixed was, because Mr
Cyril Bruntlett gave evidence to that effect. I have not, however, had the
advantage of the evidence of Mr Daniel, for he has not been called to give
evidence. Mr Geoffrey Bruntlett’s evidence was very much to the same
effect as Mr Norman Bruntlett’s evidence so far as his examination-in-chief was
concerned. He, too, ventured the opinion that so far as he was concerned if it
had been sold at £40,000 by auction it would have been satisfactory, but that a
sale at £38,000 was as far as he was concerned no sale. Mr Cyril Bruntlett’s
version of the events is somewhat different. As I have said, the other three
brothers who were trustees are basically concerned with the farming world. Mr
Cyril Bruntlett is in the building trade, working under contract as (I think) a
bricklayer. He struck me as being very much more of a man of affairs, if I can
so put it, than either of his three co-trustees. He struck me as being a man
who was very sensible of his duties as trustee. He was at the auction and he
said in chief that he was advised by A T Clark (meaning thereby Mr Daniel, who
was their representative at the auction) that the reserve price was £38,000. He
also said it was probably discussed among them before. I think what he may have
had in mind was possibly some discussion after the letter had been received
from Mr Morris indicating that the current market value for the farm was
£37,000, but it does not readily emerge from any other evidence that any firm decision
had been taken as to a reserve price at that earlier meeting.
So there at
any rate is the evidence which is given by the first four defendants, coupled
perhaps with what Mr Cyril Bruntlett said, that ‘from the outset,’ as he put
it, ‘I pressed for a sale at a reserve price to cover our immediate debts. I
agreed with the issue of instructions for the sale. I accepted the date of the
sale.’ He then went on to deal with
another question which had arisen in relation to yet another abortive attempt
to secure a family arrangement, under which it had been suggested that Mr Jack
Bruntlett should be released so as to be able to bid at the sale. What he said
was: ‘It was never agreed that Jack should be open to bid. We all knew the
property was going on sale subject to a reserve. I thought at the sale that a
price that would cover our debts would be OK.’
I may perhaps add, just in passing, that Mr Cyril Bruntlett in his
evidence made it quite clear that he initially would have been prepared to
accept the sale and not to contest it. And it was only at a very late stage
indeed that he joined in the defence which had been put in by his three
co-trustees. Now the evidence of Mr Morris is to this effect. First, so far as
the discussion which admittedly took place between himself and Mr Jack
Bruntlett is concerned, his evidence is that he told Mr Jack Bruntlett when he
rang him on the morning of the sale on his way to Langleys that he would
recommend a reserve of £38,000. His evidence also was that Mr Jack Bruntlett made
no reply to this, and in effect told him to go to the solicitors and get
instructions. He also said that he told Mr Jack Bruntlett that he would see him
at the auction and would tell him what decision had been reached with regard to
the question of the reserve. As to the meeting at Langleys with Mr Phillips and
Mr Daniel and Mrs Wellman, it was Mr Morris’s evidence that he recommended a
reserve of £37,000. Mr Phillips thought a larger sum would be appropriate. I
should add that in Mr Phillips’s evidence he said that Mr Morris had indicated
that a sum as large as £40,000 might be reached, but Mr Morris was never
cross-examined with regard to this. It may or may not be that the discussion
had ranged around figures from £37,000 to £40,000. At any rate, the sum of
£38,000 was fixed when Mr Morris went to the meeting. He saw Mr Jack Bruntlett
and told him that this sum had been fixed as the reserve. Now it is quite plain
even at this stage that there is an acute conflict of evidence as between Mr
Morris and Mr Jack Bruntlett.
Having both
seen and heard the witnesses, it is right that I should say this at the outset.
There are two witnesses whose evidence I would accept without any reservation:
those are Mr Farley and Mr Morris. I cannot but feel that Mr Jack Bruntlett, Mr
Norman Bruntlett and Mr Geoffrey Bruntlett were somewhat confused in their
recollection as to exactly what took place, and have perhaps at times persuaded
themselves that that which they might have liked to have taken place, but which
did not in fact take place, did take place. I think Mr Cyril Bruntlett was a
reliable witness, even taking into account the fact that he has changed his
position in relation to this action. I am a little less happy with the evidence
of Mr Phillips, in which there were certain slight inconsistencies, and I
confess that he did not make a very favourable impression upon me. But in
general I think his evidence in regard to actual factual matters can be
depended upon, though if there were any conflict between his recollection and
that of Mr Morris–or indeed of Mr Farley, and there is no conflict there–I
would prefer the evidence of Mr Morris. I entertain no doubt at all, so far as
the question of the reserve price is concerned, that the position was that the
family, having agreed to the sale, had, as Mr Cyril Bruntlett put it, really
left the details of the matter to the solicitors, acting no doubt in
conjunction with Mr Morris, desiring only that whatever was arranged should be
arranged with a view to securing that the outstanding indebtedness could be
met. Acting upon these instructions from the family, which I have no doubt were
instructions which admitted of no doubt and were well understood by Mr Phillips
of Langleys, by A T Clark and by Mr Morris, the sum of £38,000 was agreed. I do
not accept Mr Jack Bruntlett’s evidence that he suggested £40,000 to Mr Morris
when they met on the morning before the auction. I think that £40,000 is a
figure which has crept into his mind subsequent to the event. I accept Mr
Morris’s evidence that he told Mr Jack Bruntlett that £38,000 had been agreed
when Mr Jack Bruntlett went to the auction, and that Mr Jack Bruntlett made no
protest. As I have said, I do not know that in the end all this matters a very
great deal, except that it is one of the matters which reflects upon the
credibility of the witnesses.
At any rate,
the auction took place. The first four defendants were present. Langleys were
present in the persons of Mr Phillips and Mrs Wellman. A T Clark were present
in the person of Mr Daniel, sitting at the solicitors’ table, as is customary,
I understand, immediately on the left of Mr Morris. There were no bids. The
property was withdrawn. There was the invitation from the rostrum followed by
the dispersal. Now I have already given some account of Mr Farley’s evidence as
to what transpired. I should just say a brief word about Mr Morris’s evidence
touching the events immediately subsequent to the conclusion of the bidding. It
appears that immediately after the bidding, when he came down from the rostrum,
he had a few words with Mr Phillips and some other auctioneers who were
present, and that he was then approached by Mr Farley, who asked him whether
the property was available and if so what the price was, and he told him that
the price was £38,000, at which Mr Farley walked away. He (Mr Morris) then left
the ‘far end room’ and went out into the main body of the Corn Exchange, where
he saw Mr Moore talking to Mr Farley, and he went back into the sale room. Mr
Phillips, Mrs Wellman and Mr Daniel were still present. At this stage he told
Mrs Wellman that he thought there was a prospect of a sale. At this stage he
also told Mr Daniel that he thought there was a prospect of a sale in the sum
of £38,000. He asked Mr Daniel if he had a contract, and Mr Daniel said that
Mrs Wellman had the contract. He communicated his view about the possibility of
the sale to Mr Phillips, and it is agreed on all hands that there was a
discussion about whether a form of contract was available, and Mrs Wellman had
it, and according to Mr Morris, and I accept his evidence completely, he went
to her. But before he went to her, Mr Moore had offered a sum of £37,000. When
he went to see Mrs Wellman he told her that he could sell the farm and asked
her if she would like to
Morris asked her to let him have a contract. She did this, but before Mr Moore
returned the solicitors all left. At this stage I am quite clear that they were
aware that approaches were being made; that Mr Morris was of the opinion that
he could make a sale; and that to this end Mr Morris was desirous of having a
form of contract. It was in fact the evidence of Mr Phillips, in chief, that he
knew Mr Morris was expecting to sell. He was hoping that Mr Morris (I use his
words) was going to conclude a sale, and the contract was left with Mr Morris
for this purpose. That is, as I understand it, the plain effect of the evidence
given by Mr Phillips in cross-examination.
Mr Morris was,
I thought, a very frank and very straightforward witness. He was very properly
cross-examined on a number of relevant points, and he made it quite plain that
he was not suggesting that the sale that was concluded was a sale at auction:
it was a sale by private treaty after the auction. Mr Morris, for better or for
worse, was quite plainly, to my mind, never at any time disposed to try to
shelter behind any conceivable legal fence. He was in no doubt as to what had
in fact taken place. He thought, rightly or wrongly, that he had authority to
sell this property for the sum of £38,000 to Mr Farley, and acting in that
belief he proceeded to sell the property. The only question, in substance, to
be decided is whether he had in fact got the authority which he thought he had.
I am now going to deal with some of the events which took place shortly after
the sale, not because they have any direct relevance to the question which I
have to decide, but because they have some indirect relevance to it, as will, I
hope, emerge. Mr Morris, having as he thought concluded the sale, and having
got the cheque, proceeded to the offices of Langleys to leave them the contract
and the cheque for the deposit. Mr Phillips was engaged. Mr Morris’s evidence
was that he told Mrs Wellman that he had effected the sale. She expressed no
doubt as to the validity of the transaction at all; she appears to have been
relieved. Mr Daniel was informed, and he appears to have accepted the
transaction without question and again appears to have been relieved. The four
brothers had taken very little part in the proceedings in the sale room. Mr
Norman Bruntlett was not even sufficiently interested to pick up a copy of the
sale particulars, and they all left fairly shortly after the conclusion of the abortive
auction. Mr Cyril Bruntlett, however, was sufficiently interested to approach
Mr Daniel, and his evidence is that he asked Mr Daniel whether he ought to
remain. Mr Daniel told him that there was no need for him to remain, but that
perhaps he might telephone him, Mr Daniel, about five five o’clock that
evening. I apprehend that Mr Daniel told Mr Cyril Bruntlett this possibly in
anticipation of there being some news for him. At any rate, Mr Cyril Bruntlett
did telephone Mr Daniel. He was told that the sale had taken place at £38,000,
and he very frankly said that so far as he personally was concerned, at that
stage this was a relief to him.
On his way
home Mr Morris understandably, for apparently he passed nearby, called upon Mr
Jack Bruntlett and told him that the sale had taken place. Mr Jack Bruntlett’s
account of the event is in these terms, that having been told by Mr Morris that
the sale had taken place, and having asked Mr Morris about the price and having
been told it was £38,000, he next asked Mr Morris what authority he had had to
sell at this price. Mr Morris, according to Mr Jack Bruntlett, indicated to him
that he did not need any authority, in terms which I do not think Mr Morris
would ever be likely to employ. Mr Morris’s account is at complete variance
with that of Mr Jack Bruntlett. He said he told Mr Jack Bruntlett about the
sale. He did not seem particularly pleased with the result, but he at that time
made no protest of any sort or kind. I entirely accept Mr Morris’s version of
this. Mr Jack Bruntlett’s evidence then went on to this effect, that he
telephoned Mr Norman Bruntlett and Mr Geoffrey Bruntlett to let them know what
had taken place. He cannot have telephoned his brothers, because they were not
on the telephone, but be that as it may–it is only a minor discrepancy–it does
appear that they all had some discussion that evening; they lived not far from
one another. In fact, Mr Cyril Bruntlett had telephoned his mother to let her
know the result after he had been told it on the telephone by Mr Daniel, and Mr
Norman Bruntlett and Mr Geoffrey Bruntlett gave evidence that they learned what
had happened in discussion with their mother, who is on the telephone, and not
by way of any telephone call from Mr Jack Bruntlett. After that, as I have
said, the second, third and fourth defendants, being dissatisfied with the
results, started to consider the question as to whether there had been a valid
sale or not. Having seen them and heard them in the witness-box, I entertain no
doubt whatsoever that at this stage they had no idea as to the legal niceties
that might be involved. I do not think the question of the possibility of some
challenge to the authority of Mr Morris, or anything of that kind, was formed
as a reality in their minds. Although Mr Jack Bruntlett appears to have been
the person most disgruntled by the events, curiously enough when the question
arose as to obtaining further legal advice, what he did was to persuade his
brothers, Norman and Geoffrey, to approach yet another firm of solicitors in
Lincoln, which they did. They do not appear to have been altogether satisfied
with the result, and eventually they came to the solicitors now acting for
them.
And so the
case has come on, and it really comes down to one very small point: had Mr
Morris authority, express or implied, to contract for the sale of the property
otherwise than by way of auction? Quite
plainly he had no written authority. The letters which were written are letters
written authorising him to sell by auction and to sell by auction alone. I was
referred by counsel to a number of authorities, most of them of some
considerable antiquity, dealing with questions of sale by auction. I do not
know that I need to go into all those authorities, because for the purposes of
the present proceedings counsel on all sides appear to agree with, and were
prepared to assent to, this general proposition which one can find voiced in
more than one textbook, that an authority to sell by auction does not authorise
a sale by private treaty. I do not go into the history of the authorities which
form the basis for this textbook proposition. Of all the authorities which were
cited, the only one which appears to me to be very much of assistance, so far
as the case before me is concerned, is Bousfield v Hodges (1863)
33 Beav 90. This was a case where a sale had been authorised as part of a
compromise, and one of the terms of the compromise was that the sale should be
a sale by public auction. It was also agreed that a Mr Simpson, the executor
and trustee, should have the conduct of the sale. That was in fact a case where
it was first agreed that all parties should be at liberty to bid. The property
was put up for sale, as Hall Farm was. It was bought in, as Hall Farm was. At a
later date, exactly how much later is not established (there is no suggestion
it was in the auction rooms–not that it would have mattered if it had been), Mr
Simpson sold the property by private treaty at the reserve price. Bousfield
v Hodges is a case, however, which differs from the present case in this
way, that it was a case where the purchaser was trying to get out of the
contract and not the vendors. It does bear certain similarities to the present
case, and I do find some assistance from a passage in the judgment of the
Master of the Rolls at page 92. He has been referring to the fact that Mr
Simpson had the conduct of the sale but failed to get any bid at auction, and
he refers also to the subsequent offer at the reserved price which was accepted
by
it would have been competent for him to accept at auction, and said:
I do not
dispute that where an agent or a trustee is authorised to sell any property in
a particular manner the authority is limited to that particular mode of
selling, and that he cannot exceed the scope of his authority. But that is not
the case here. It was an agreement by all parties that the property should be
sold at all events for the purposes of division, and that it should be sold by
public auction. If it could not be sold at all by public auction, is there to
be an end to the compromise? I think
not. As soon as Mr Simpson attempted to sell by auction he found that he could
not sell it by that mode and he then accepted an offer to purchase the property
upon the conditions of sale and at the reserved price previously agreed to be
accepted for it. I think that this is a perfectly good sale and that the
defendant is bound to complete.
The comment
made by counsel on behalf of the first four defendants is that this differed
from the present case in that this was a case of a sale by a person to whom an
express authority had been given to sell. I would only comment that so far as
any question of express authority is concerned upon the facts as disclosed in
the report, Bousfield v Hodges was a case in which the only
express authority which Mr Simpson received was authority to sell by public
auction. Counsel for the first four defendants points out, quite rightly, that
this is a sale by private treaty which had not been expressly authorised by the
letters of instruction. He points out, quite rightly, that Mr Morris expressly
disclaimed any suggestion of adoption of the sale by the first four defendants.
And he asks the question as to whether there was any authority, express or
implied, for what was here done by Mr Morris. He asks from what can authority
be implied. He suggests that the mere fact that £38,000 was agreed as the
reserve cannot of itself give an authority to sell at that figure subsequent to
the auction. He says that the mere fact that Mr Morris issued a general
invitation, albeit in the presence of the first four defendants, to interested
persons to come and see him cannot of itself give him any implied authority to
close with any prospective purchaser who did come to see him. The case on
behalf of Mr Morris is put quite simply in this way, that the question that I have
to decide is a question of fact, and that on the facts only one conclusion can
be reached, namely that Mr Morris did in fact have authority to sell this
property in the way which he did for this particular sum. Counsel for Mr Morris
starts off by saying that one must accept the position that the Bruntlett
family, and the whole of the trustees in particular, had accepted–and indeed
they were sufficiently interested to inquire, and knew when they went to the
auction–that a reserve of £38,000 had been fixed. Counsel for Mr Morris points
to the strange fact that so far as the documents in the case go, so far as any
evidence in the case can be relied upon, the question of lack of authority was
never taken up with Mr Phillips. Indeed, he went so far as to assert that the
whole of the defence in this action based upon Mr Morris’s lack of authority is
a feature which must be considered as being the creation of the legal advisers
to the first four defendants.
Now if Mr
Morris had authority, he could only have got that authority from Langleys, who
were acting as solicitors to the trustees, and possibly from A T Clark, because
he does not himself suggest that he ever dealt directly with members of the
Bruntlett family. So the first question which no doubt has to be considered is
whether in fact Langleys had any authority to sell. So far as that is
concerned, the evidence of Mr Norman Bruntlett was to my mind undoubtedly
conclusive as to this, that so far as he was concerned, the trustees had agreed
that this property should be sold. They had left the details of the sale to
Langleys and Clark & Co. So far as Mr Geoffrey Bruntlett is concerned, his
position appears to have been that he took very little part in any actual
decision. He said, not once but more than once, that he was content to follow
the head trustees, by which I think he meant Mr Cyril Bruntlett and Mr Jack
Bruntlett. So far as Mr Cyril Bruntlett is concerned, I have already dealt with
his evidence upon this particular point. He was at all times concerned to urge
a sale. He, too, was content to leave the details both as to the sale and price
to the solicitors, and did leave it to the solicitors. So far as Mr Jack
Bruntlett is concerned, I think it is fair to say that he never in terms
committed himself to this proposition, that he handed the whole conduct of the
sale and the details of particulars over to Langleys. He was in fact at one
time prepared to go this far, that he might in certain circumstances go so far
as to accuse Langleys of negligence if they had in fact been a party to any
consent to a sale at a price which he, Mr Jack Bruntlett, had not agreed was a
proper price. I think myself that to some extent Mr Jack Bruntlett has perhaps
misconceived the realities of his situation. I do not know how far he may ever
have been in a position where it would have been possible for him to raise a
sum of the order of £40,000 for the purchase of this farm; if he was in fact in
the position to raise a sum of that sort at the time, I should have thought
that he would have been urging upon Mr Phillips of Langleys, or somebody else
amongst the solicitors, the absolute necessity for securing a reserve of at
least the amount for which he thought he could purchase. Mr Morris’s account of
the events after the sale, which I accept, undoubtedly indicates that after the
sale, when the property had gone for a price which Jack, Norman and Geoffrey
Bruntlett undoubtedly considered was too low, Mr Jack Bruntlett did challenge
Mr Morris as to on whose authority it had been sold on. When he received the
answer that it was on the solicitors’ authority, if he thought the solicitors
had had no authority he must at that stage inevitably, I should have imagined,
have got in touch with them. Mr Jack Bruntlett’s imaginary telephone conversations,
because he undoubtedly had no telephone conversations with Norman and Geoffrey,
went further than this, for he said that in the week immediately following the
sale he telephoned to Mr Phillips, I think he put it, hundreds of times. Even
allowing for the fact that I do not suppose he intended to indicate by that
more than that he had phoned a great many times, the reality of the situation
on Mr Phillips’s evidence (which, as I have said, I accept on strict matters of
fact) appears to have been this: that he may have telephoned once, but it
certainly did not appear (it was not put to Mr Phillips) that on this occasion
he, Mr Jack Bruntlett, was challenging the authority of Langleys to effect the
sale, and at this stage, on Mr Morris’s evidence, that would be what he ought
in fact to have been doing.
So in the end
I come back to the position as it was put in Mr Phillips’s evidence initially,
which is that by the end of February the decision had been taken to sell. The
details of the sale were left to the solicitors. They had been instructed to
have in mind some minimum sum which would clear the debts on the property, a
sum of the order of £35,000 at least. They were proceeding upon the basis that
a valuation of £37,000 had been made. Against that valuation the reserve of
£38,000 was fixed. By the time Mr Morris in fact signed the contract, I have no
doubt, upon the evidence as it emerged, that he must be taken to have had
authority from Langleys, and from A T Clark if needed, to complete this
contract; and they in their turn had full and sufficient authority from the
first four defendants to sell the property at such a price. I have related the
evidence concerning this transaction already. By the time Mr Phillips left the
auction room he expected Mr Morris to effect a sale. He hoped that Mr Morris
would effect a sale. Mrs Wellman and Mr Daniel were in like position. When all
these people were informed that a sale had taken place, it never crossed the
minds of any of them that Mr Morris had not sufficient
of any of the Bruntletts that Mr Morris had no authority to conclude the
agreement. I think that Mr Jack Bruntlett, and possibly Mr Norman and Mr
Geoffrey Bruntlett, once they were minded if they could to challenge the sale,
did start making inquiries, and their minds may have been turned, as a result
of the inquiries that they made, to the possibility of a challenge to
authority; but initially they were not even quite sure whose authority should
be challenged. I certainly, as I have said, dismiss altogether Mr Jack
Bruntlett’s version that he challenged Mr Morris’s authority that same night.
In the time which then elapsed until the pleadings in this action were entered,
I think that inquiries were being made; and of course the first four defendants
had every right to see whether effectively there was some flaw in this
agreement, but for the reasons which I have endeavoured to advance, I do not
think there ever was any flaw. The family had in fact reached the conclusion,
no doubt a sensible conclusion in all the circumstances, that the sale of this
property was necessary. They authorised the solicitors to effect a sale for a
sum that would be adequate to clear their indebtedness. Initially it was
considered that the sale should be by auction. When that proved abortive it was
at once apparent, no doubt to the first four defendants but undoubtedly to the
solicitors, that something might yet be done on that same afternoon. The
authority of the solicitors was, as far as I can see, in no way terminated
because the auction had proved abortive. Indeed, it was not suggested that it
had been terminated, and one fact which did emerge was that so far as any
argument addressed to me was concerned it was never suggested that the
solicitors had not in fact had authority to sell at such price as might be
sufficient. I have not had the benefit of the evidence of Mrs Wellman and Mr
Daniel. I dare say that if their evidence might have established that the account
given by Mr Morris was wholly unacceptable, they might have been called by one
of the interested parties. I can only go on the evidence of Mr Morris and Mr
Phillips, and that all goes to one point, which is that the solicitors knew
that Mr Morris thought he could conclude a sale, they wanted him to conclude
it, and they by the action which they took effectively encouraged him to
conclude it. In the result, the defence of the first four defendants fails, but
that of the fifth defendant succeeds.
An order was
made for specific performance, the costs of the plaintiffs and of the fifth
defendant to be paid by the first four defendants.
