L & D Associates (A Firm) v. Wu Siu Keung

IN THE COURT OF APPEAL

1987, No. 59
(Civil)

BETWEEN

Coram : Hon. Yang, Ag. C.J., Clough & Power, JJ.A.

Dates of Hearing : 24^th July 1987

Date of Judgment: 24^th July 1987

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JUDGMENT

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Power. J .A.:

1. This is an appeal from a decision of His Honour Judge Scriven in the District Court.  The Plaintiff/Respondent, L & D Associates, are a firm of real estate agents who took action against the appellant, Mr. WU Siu-keung to recover commission to which they claimed entitlement upon the purchase by Mr. Wu of Flat B, 11/F, Primrose Mansion, Harbour View Gardens, Taikooshing to which they had introduced him.  The claim is for $10,300 being commission of 1% on a purchase price of 1.03 million dollars.

2. The plaintiff having been approached by Mr. Wu, took him to inspect several properties. Each time he inspected a property he signed a standard form, which the plaintiffs present to all their clients, headed “Inspection Record". This form bears certain words in both English and Chinese, which are relevant to these proceedings. The relevant notation in English reads:

"I hereby agree to engage your service for introducing premises listed above to be purchased/rented by me and in consideration thereof I agree to pay your agency fee in the sum of 1% of the purchase price/ ½ of the monthly rental in respect of the premises in question. I further agree that this agreement shall be binding on my family members, nominees or agents who subsequent to the said introduction purchase/rent the said premises."

3. Mr. Wu does not speak English but there was clear evidence from an employee of the plaintiff, Miss Stella Ho, which was accepted by the trial judge that she had explained this provision to him.  She said:

Before inspecting I showed him the record and asked him to sign before doing so. I said after taking him to inspect if successfully purchased 1% of price of premises whether he or his relative bought.”

The form also contained a notation in Chinese. No certified translation of this notation was produced but it was interpreted at the trial by the court interpreter, without objection by either party, as follows:

"The above premises are viewed by L & D Associates and if successfully purchased or rented the tenant/buyer should pay this company ½ rental or 1% on purchase price."

4. The defendant having viewed the premises allowed the plaintiff to negotiate for him.  This negotiation resulted in the vendor lowering his asking price from $1,080,000.00 to $1,040,000.00. The defendant offered $1,030,000.00 which the vendor was not prepared to accept. An impasse having been reached Miss Ho admits that she said to the defendant on the telephone “I am sorry, I cannot assist any more.”  The defendant himself gave evidence as to that conversation saying "Miss Ho telephoned me and asked me to increase my offer. I did not. Then she said she could not help as the vendor accepted nothing less than $1,040,000.00."

5. On the very day of this telephone call, which appears to have been 26th May, the defendant, having been told by his son that an agent known as Kam Lung had premises available in Primrose Mansion, went with that agent to the premises and found that they were the same premises as had been offered to him by the plaintiff. Kam Lung offered $1,020,000.00 on his behalf and he eventually purchased the premises through Kam Lung at $1,030,000.00. This purchase was agreed to at 8 p.m. on the 26th.

6. On the following day Hiss Ro again telephoned the defendant asking him how he felt about the premises. He told her that he had purchased them through Kam Lung and the plaintiff in consequence, has brought this action to recover its commission.

7. It is common ground that the defendant acted throughout the negotiations with the plaintiff as agent for an disclosed principal who was in fact, his son and it is common ground that he continued so to act when dealing with Kam Lung up until the signing of the agreement for sale and purchase on 27th May 1986.  We are satisfied that by so acting he made himself personally liable upon any agreement that he entered into with the plaintiff.

8. The pleadings in this matter were unsatisfactory in that they failed to crystallize the real issues between the parties.  No point has been taken in that regards in this appeal.

9. The primary argument of Mr. Chan, for the appellant, is that Miss Ho, by saying the words, "I am sorry.   I cannot assist any more", rescinded and abandoned the contract that had come into existence between the plaintiff and the defendant and abandoned any right the plaintiff would otherwise have had to receive commission thereunder.  He suggests that these words were a clear indication to the defendant that the plaintiff no longer considered either party bound by anything that had been agreed to in their negotiations.

10. This suggestion is, to an extent, undermined by the evidence of the appellant himself for he says that Miss Ho telephoned him on the 27th May to enquire whether he intended to pursue his attempt to purchase the property.  We have no doubt, applying our commonsense to the facts, both that Miss Ho had no intention of conveying that she was bringing the contractual relationship between the parties to an end and that no reasonable person would have been led to believe that she was conveying any such intention.

11.We are satisfied that right to commission arose if the defendant succeeded in purchasing a property after an introduction to it by the plaintiff. Indeed it is difficult to see how it could sensibly be suggested that an estate agent having introduced a client to a property on the understanding that if the client bought it he would pay commission would, for no apparent reason, take it upon himself to abandon his commission.  We do not consider that there is any merit in this argument and turn to the second argument relied on by Mr. Chan.

12.It is his contention that the words used in the "Inspection Record” to which reference has been made entitle the plaintiff to a commission only if he concludes the bargain on behalf of the purchaser.  We cannot agree.  The words, when set in the context of a situation such as obtained here, clearly mean what they say which is that, if after introduction the property is successfully purchased… the buyer should pay …. 1% on purchase price". Purchase did follow upon the introduction by the plaintiff and the defendant did therefore become liable to pay commission. It was Mr. Chan's argument that such a clause surely could not be said irrevocably to bind a buyer who, perhaps at some time far in the future, purchases the property. This may be so. Efflux ion of time or material change in circumstances may well relieve the purchaser of his liability to pay commission. There was, however, nothing of that kind in the present case. This latter argument also fails and the appeal must be dismissed.

13.This judgment is the judgment of the court.

Mr. Louis K.Y. Chan (Messrs. Poon & Cheung) for the Appellant.

Mr. Bernard Yuen (Messrs. Joseph C.T. Lee & Co.) for the Respondent.