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  • Unreported Judgment

Urban Property Agents Pty Ltd v Vann & Anor

 

[2020] QDC 226

DISTRICT COURT OF QUEENSLAND

CITATION:

Urban Property Agents Pty Ltd v Vann & Anor [2020] QDC 226

PARTIES:

URBAN PROPERTY AGENTS PTY LTD

(ACN 140 649 225)

(appellant)

v

PHILLIPPA MARY VANN

(first respondent)

AND

NATHANIEL JOHN VANN

(second respondent)

FILE NO/S:

3073/19

DIVISION:

Civil

PROCEEDING:

Appeal

ORIGINATING COURT:

Magistrates Court at Brisbane

DELIVERED ON:

11 September 2020

DELIVERED AT:

District Court at Brisbane

HEARING DATE:

6 April 2020

JUDGE:

Sheridan DCJ

ORDER:

  1. Appeal dismissed.
  2. The appellant to pay the first and second respondents’ indemnity costs in relation to the preparation of the costs appeal, fixed in an amount of $4,490.20.
  3. Otherwise, unless the parties make written submissions as to costs within 14 days of the date of this judgment, the appellant pay the costs of the first and second respondents of the appeal on the standard basis.

CATCHWORDS:

PROFESSIONS AND TRADES – AUCTIONEERS AND AGENTS – REMUNERATION – EFFECTIVE CAUSE OF SALE – where agent for appellant introduced prospective purchasers to property owned by respondents – where agent for the appellant prepared and delivered draft contract of sale to purchasers – where respondents refused to accept contract on terms proposed by agent for appellant – where second agent sold purchasers’ property and prepared contract for sale of respondents’ property – where contract prepared by second agent subsequently executed and settled by respondents and purchasers – where appellant sought payment of commission for sale of property – where trial magistrate found that agent for appellant was not effective cause of sale – whether agent for appellant entitled to commission – whether agent for appellant was effective cause of sale

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – OFFERS OF COMPROMISE, PAYMENTS INTO COURT AND SETTLEMENTS – INFORMAL OFFERS AND CALDERBANK LETTERS – UNREASONABLE REFUSAL OF OFFER – where solicitors for respondents served appellant with offer to settle – where offer to settle sent shortly after claim filed and before defence had been filed – where appellant rejected offer – where trial magistrate found it was unreasonable for appellant to reject offer – where trial magistrate ordered appellant to pay respondents’ costs on indemnity basis – where appellant’s notice of appeal did not raise cost decision – where at hearing of appeal appellant sought leave to read and file amended notice of appeal out of time – where amended notice of appeal contained additional ground of appeal relating to trial magistrate’s cost decision – whether rejection of offer was unreasonable

District Court of Queensland Act 1967 (Qld), s 113

Uniform Civil Procedure Rules 1999 (Qld), r 766, r 785(1)

Allesch v Maunz (2000) 203 CLR 172, cited

Burchell v Gowrie [1910] AC 614, cited

Dwyer v Calco Timbers (2008) 234 CLR 124, cited

Emmons Mount Gambier Pty Ltd v Specialist Solicitors Network Pty Ltd [2005] NSWCA 117, cited

Fox v Percy (2003) 214 CLR 118, cited

Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2) (2005) 13 VR 435, applied

House v The King (1936) 55 CLR 499, cited

J & D Rigging Pty Ltd v AGRI Power Australia Limited [2014] QCA 23, cited

LJ Hooker Ltd v WJ Adams Estates Pty Ltd (1977) 138 CLR 52, applied

Moneywood Pty Limited v Salamon Nominees Pty Limited [2000] 202 CLR 351, cited

Warren v Coombes (1979) 142 CLR 531, cited

COUNSEL:

S W Trewvas for the appellant

M A Taylor for the first and second respondent

SOLICITORS:

Macpherson Kelly for the appellant

Wheldon & Associates for the first and second respondent

Introduction

  1. [1]
    The appellant sued the first and second respondents (the respondents) for commission alleged to be owing pursuant to an agency agreement with the respondents.  The agreement related to the sale of the private home owned by the respondents at 10 Vista Street, Bardon (the Property).  The Agreement provided relevantly that if the appellant was the effective cause of the sale of the Property the appellant was entitled to commission.
  1. [2]
    On 30 July 2019, there was a finding made in the Magistrates Court that the appellant was not entitled to commission in connection with the sale of the Property. The learned magistrate held that the agent for the appellant was not the effective cause of sale of the Property.
  1. [3]
    The appellant appeals the decision of the magistrate, in respect of both the effective cause of sale finding and the decision on costs.

Facts

  1. [4]
    The facts found by the magistrate were not in dispute. Indeed, the main facts were not seriously in dispute at the trial. To the extent that there were differences, the magistrate preferred the evidence of the respondents and their witnesses to that of the principal witness for the appellant. This makes the recitation of facts relatively simple.
  1. [5]
    The respondents first marketed the Property exclusively through ‘Calibre Real Estate Pty Ltd’ (Calibre) for the period from 21 May 2017 to 11 September 2017.  Mr Keogh acted as the agent of the Property for Calibre.  During the period of Calibre’s exclusive agency, Mr Keogh had presented the respondents with signed contracts; albeit the contracts did not complete.
  1. [6]
    The appellant was appointed as the exclusive agent of the Property on 11 September 2017. Mr Mitchell executed the agreement on behalf of the appellant and acted as the agent for the appellant. The exclusive agency ended on 23 October 2017.
  1. [7]
    The agreement provided that at the end of the sole or exclusive agency, the appointment of the appellant will continue as an open listing. The open listing commenced on 24 October 2017.
  1. [8]
    The agreement provided that where there was an open listing, the agent is entitled to the agreed commission where the agent is the effective cause of sale. The agreement stated that, under the terms of the open listing, the client did not have to pay the agent:

“If the client sells the property privately and the agent is not the effective cause of sale i.e.: purchaser did not contact the agent, did not attend open house inspections etc.”

  1. [9]
    During the period of the exclusive agency, Mr Mitchell did not present the respondents with any written or verbal offers capable of acceptance.
  1. [10]
    Ms Lansky and Mr Addison, the eventual purchasers of the Property (the Purchasers), viewed the Property on 28 October 2017, at an open home organised by Mr Mitchell.
  1. [11]
    On 29 October 2017, the Purchasers contacted Mr Keogh (the previous agent of the Property) to discuss, among other things, the renovation or sale of the Purchasers’ own property, and the merits of the Property itself. The Purchasers had a pre-existing relationship with Mr Keogh, by virtue of being in the same neighbourhood and having social contact.
  1. [12]
    On 30 October 2017, the Purchasers undertook a private inspection of the Property, organised by Mr Mitchell at the request of the Purchasers. In the text message to Mr Mitchell requesting the further inspection, Ms Lanskey referred to “…mak[ing] a decision re offer.” At that inspection, it was accepted that the Purchasers told Mr Mitchell, in making an offer, they would need to sell their own property and would need a clause to that effect. Mr Mitchell offered to prepare and deliver a contract to them the next day.
  1. [13]
    On 31 October 2017, a draft contract was delivered by the appellant to the Purchasers for the purchase of the Property for $1,200,000 subject to sale of the Purchasers’ property. The contract was never executed by the Purchasers and the Purchasers never gave Mr Mitchell instructions to make an offer in those terms.
  1. [14]
    On the same day, 31 October 2017, one of the Purchasers (Ms Lanskey), sent a text message to Mr Keogh confirming that the Purchasers had decided to put in an offer on the Property, enquiring whether Mr Keogh had a recommended conveyancer, requesting a copy of the building and pest report for the Property and indicating that she needed to speak with Mr Keogh further about selling the Purchasers’ own property.
  1. [15]
    Mr Keogh subsequently provided the Purchasers with a copy of the pest and building report from his file on the Property as well as a panel of names of conveyancers. The Purchasers signed an open listing for the sale of their property with Calibre, with Mr Keogh to act as agent, on 31 October 2017.
  1. [16]
    The appellant, acting through Mr Mitchell, had conversations with the respondents on 31 October 2017 and again on 1 November 2017, in which he indicated to the respondents that he may have some purchasers who were interested in making an offer of $1,200,000 but the offer would be subject to the sale of their own property. In the conversation on 1 November 2017, Ms Vann (on behalf of the respondents) told Mr Mitchell that they would absolutely not accept a contract subject to sale because they could not afford to wait three months for a sale; the property had already been on the market for three months and they were paying a bridging loan in relation to another property they had purchased. At this time, the respondents did not know the name of the purchasers.
  1. [17]
    On 1 November 2017, Mr Keogh became aware from a discussion with Ms Vann (on behalf of the respondents) that the agency agreement between the respondents and the appellant was no longer exclusive and that he could bring forward purchasers.
  1. [18]
    In discussions between Mr Keogh and the Purchasers around this time, Ms Lanskey said that Mr Keogh advised the Purchasers that the sale of their property could happen quickly, and if so, they would be in a better position for the purchase of the Property. Ms Lanskey (on behalf of the Purchasers) said she understood that if they would wait until then, whatever offer they made would be more attractive.
  1. [19]
    On 3 November 2017, the respondents signed an open listing agency agreement with Mr Keogh for the sale of the Property and Mr Keogh reached a heads of agreement with a buyer of the Purchasers’ property.
  1. [20]
    On 4 November 2017, Ms Lanskey sent a text message to Mr Keogh, asking if they needed to do anything to put an offer in on the Property.
  1. [21]
    On 6 November 2017, Mr Keogh secured a conditional sale of the Purchasers’ property.
  1. [22]
    Following this, Mr Keogh arranged for the respondents and the Purchasers to execute a contract for the purchase of the Property. This contract was subject to the Purchasers’ sale of their own property becoming unconditional within 14 days, and thereafter settling within 30 days, of the contract date. The eventual agreed sale price was $1,225,000.
  1. [23]
    On 9 November 2017, Mr Vann (on behalf of the respondents) sent a text message to Mr Mitchell requesting the open home for the Property, which was scheduled for that weekend, be cancelled.
  1. [24]
    On 30 November 2017, Ms Vann (on behalf of the respondents) sent a text message to Mr Mitchell, requesting that Mr Mitchell remove the appellant’s sign tomorrow, saying that Calibre would be putting out their “sold” sign tomorrow.
  1. [25]
    On 29 January 2018, the Purchasers were registered as owners of the Property.
  1. [26]
    On 13 April 2018, the appellant commenced proceedings in the Brisbane Magistrates Court claiming $42,565 for commission for the sale of the Property, plus interest, plus costs.

Decision at First Instance

  1. [27]
    It was accepted by the learned magistrate that the appellant’s agent, Mr Mitchell, had introduced the Purchasers to the Property by conducting an open home on 28 October 2017 and arranging a second private inspection on 30 October 2017. Further, the magistrate accepted that, while the Purchasers did not leave the second inspection with a contract prepared by Mr Mitchell, he had in fact prepared a contract of sale and had it delivered to the Purchasers on 31 October 2017. Those actions, however, in the magistrate’s view, did not flow through to the actual sale of the Property.
  1. [28]
    A factor highly relevant to the magistrate’s ultimate conclusion was the fact that Mr Mitchell and the respondents had reached a critical impasse when the respondents refused to enter a contract subject to the sale of a purchaser’s property. Further, by Mr Mitchell’s own admission, he did nothing to make the sale of the Property unconditional by finding a buyer for the Purchasers’ property.
  1. [29]
    The magistrate found that the causal connection, between Mr Mitchell’s efforts in introducing the Purchasers to the Property and in preparing a contract of sale and the ultimate sale of the Property, was broken. Therefore the appellant was held not to have been the effective cause of the sale of the Property and commission was not payable.
  1. [30]
    The learned magistrate found that the evidence established that Mr Keogh was the effective cause of sale of the Property. The magistrate found that Mr Keogh intervened at the impasse between the appellant and the respondents, realising that a buyer had to be found for the Purchaser’s property before the respondents would be willing to accept a contract for sale, obtained an agency agreement with the Purchasers to sell their property and in a matter of days found and secured a buyer for the Purchasers’ own property. The magistrate found that Mr Keogh then negotiated with the Purchasers and the respondents about the settlement date and the purchase price for the Property which was ultimately accepted.

Decision at First Instance on Costs

  1. [31]
    At the conclusion of the learned magistrate’s reasons, the parties were directed to file and serve written submissions and material on the issue of costs within 21 days of publication of the written reasons, unless otherwise agreed.
  1. [32]
    In making submissions as directed, the following matters were revealed:
  1. On 4 May 2018, soon after the appellant had filed and served its claim, the solicitors for the respondents sent correspondence to the solicitors for the appellant on a ‘without prejudice, save as to costs’ basis, offering to pay the appellant $10,000 in full and final settlement of the matter;
  1. On or about 8 May 2018, the appellant rejected this offer;
  1. On 8 May 2018, the appellant served on the solicitors for the respondents an offer to settle, requesting payment of $35,000 in full and final satisfaction of the matter; and
  1. The respondents rejected the appellant’s offer.
  1. [33]
    The respondents made submissions that the appellant’s rejection of the offer was unreasonable and consequently that the appellant should be ordered to pay indemnity costs. The respondents sought indemnity costs in the sum of $49,446.27, or alternatively standard costs in the sum of $13,017.
  1. [34]
    The appellant made submissions that indemnity costs should not be ordered to be paid by it, as the respondents had not established that it was unreasonable for the appellant to reject the offer at the time it was made. This argument was made on the basis that a defence had not, as at the date of the offer, been filed and the appellant was unaware of any of the relevant circumstances which would enable it to properly assess whether it ought to accept the offer, and the offer was only open for six days.
  1. [35]
    The learned magistrate found that it is ‘uncontroversial’ that the terms of the offer were clear, and clearly foreshadowed an application for indemnity costs in the event that the offer was not accepted by the appellant.
  1. [36]
    While it was accepted that the respondents’ offer was made before the respondents had filed a defence, the magistrate found that, at the time that the offer was made, the appellant was sufficiently aware of all the relevant facts such that the appellant was in a position to assess its prospects of success. Relevantly, the magistrate found that Mr Mitchell knew as much as Mr Keogh knew, namely, that the respondents were repaying two mortgages and were not interested in entering a contract subject to the sale of a potential Purchaser’s property in circumstances where a buyer had not yet been found. As the magistrate found, the appellant knew that Mr Mitchell was not the agent who secured the contract for the sale of the Purchasers’ property, and it did not matter that they did not know it was Mr Keogh who was the agent on the sale of that property.
  1. [37]
    As such, the magistrate found that it was unreasonable for the appellant to reject the respondents’ offer.
  1. [38]
    The appellant was ordered to pay the respondents’ costs on an indemnity basis to be agreed or, in the absence of an agreement, to be assessed.

Mode of Appeal

  1. [39]
    Pursuant to s 45(1)(a) of the Magistrates Court Act 1921 (Qld), any party who is dissatisfied with a judgment or order of a Magistrates Court, in an action in which the amount involved is more than the minor civil dispute limit,[1] may appeal to the District Court as prescribed by the rules.  It is accepted that, as this appeal involves an action for an amount of more than the minor civil dispute limit, the appellant is entitled to appeal to this court as of right.
  1. [40]
    On an appeal from the Magistrates Court, the District Court has the same powers as the Court of Appeal has to hear the appeal.[2]  Pursuant to r 765(1) of the Uniform Civil Procedure Rules 1999 (Qld) (UCPR), the appeal is by way of rehearing.
  1. [41]
    For an appeal by way of rehearing:

"…the powers of the appellate court are exercisable only where the appellant can demonstrate that, having regard to all the evidence now before the appellate court, the order that is the subject of the appeal is the result of some legal, factual or discretionary error.”[3]

  1. [42]
    The rehearing requires this Court to conduct a real review of the record of proceedings below, rather than a complete fresh hearing.[4]  The appeal court is required to review the evidence and make up its own mind about the case.[5] 
  1. [43]
    Its function is to consider each of the grounds of appeal having regard to the evidence and determine for itself the facts of the case and the legal consequences that follow from such findings. In doing so, it ought to pay due regard to the advantage that the magistrate had in observing the witnesses and the conduct of the trial generally, and attach a good deal of weight to the magistrate’s view.[6]

Grounds of Appeal

  1. [44]
    The appellant, in its Notice of Appeal filed 27 August 2019, appealed against the whole of the decision of the learned magistrate. By the time of the hearing, the grounds of appeal relied upon in the Notice of Appeal were as follows:
  1. The magistrate erred in fact and in law in finding that the appellant was not the effective cause of sale;
  1. The magistrate erred in failing to find that, on the weight of the evidence, the appellant was not the effective cause of sale; and
  1. The magistrate erred in fact and in law by failing to consider the evidence of the Purchasers when finding that the appellant was not the effective cause of sale.
  1. [45]
    The appellant’s Notice of Appeal filed 27 August 2019 did not raise the finding of the learned magistrate in the cost decision as a ground of appeal. However, at the hearing of the appeal, the appellant sought leave to read and file an amended notice of appeal (Amended Notice of Appeal) out of time.  This Amended Notice of Appeal sought to raise the learned magistrate’s finding that the appellant’s rejection of the offer of settlement was unreasonable, as a new ground appeal. 

Effective Cause of Sale

  1. [46]
    The legal principles relevant to this dispute are not in issue. To establish that the agent was the effective cause, it is necessary for the agent to prove that there was a causal connection between the agents’ efforts and the completion of the transaction.[7]  In LJ Hooker Ltd v WJ Adams Estates Pty Ltd,[8] Jacobs J said:

““Effective cause” means more than simply “cause”.  The inquiry is whether the actions of the agent really brought about the relation of buyer and seller and it is seldom conclusive that there were other events which could each be described as a cause of the ensuing sale.  The factual inquiry is whether a sale is really brought about by the act of the agent.”

  1. [47]
    In appropriate circumstances, agents will be entitled to commission by virtue of an “initial introduction” of a prospective buyer to the property where the initial introduction of the prospective buyer has “led quite directly led to the sale.”[9]
  1. [48]
    If the first agent is wishing to establish that its actions amount to the effective cause of sale, it must establish that its initial efforts flowed through such that it was, in a real sense, the cause of the ultimate sale or that its efforts, in spite of the intervening actions of the second agent, continued to influence the purchaser in its eventual decision to purchase the property in question.[10]
  1. [49]
    The appellant submitted that the efforts of the first agent, Mr Mitchell, continued to influence the Purchasers in their decision to purchase the Property as:
  1. (a)
    The time between the private inspection (i.e. second inspection) and the date of contract execution was less than a week;
  1. (b)
    The Purchasers requested the private inspection to “make a decision re offer”;
  1. (c)
    Mr Addison gave evidence at the hearing to the effect that the decision to pay the purchase price was independent of anything Mr Keogh said or did;
  1. (d)
    The Purchasers in their evidence indicated that Mr Keogh was not chosen to make the offer to purchase the Property for any other reason than convenience;
  1. (e)
    The Purchasers gave evidence that they would not have bought the Property without viewing it and Mr Keogh never showed the Purchasers the Property;
  1. (f)
    On 31 October 2017, the Purchasers sent a text message to Mr Keogh informing him that they had decided to put an offer on the Property, however Mr Keogh was not an appointed agent for the Property at that stage;
  1. (g)
    The appellant was “shut out” of negotiations with the Purchasers on the suggestion of Mr Keogh; and
  1. (h)
    The amendments to the conditions of the contract were because the Purchasers executed a sale contract for their house, which was simply a matter of timing rather than of any efforts made by Mr Keogh.
  1. [50]
    The learned magistrate found that the introduction to the Property, and preparation of the contract, by Mr Mitchell for the appellant, on its own, was insufficient to secure the actual sale of the Property. The magistrate found that Mr Mitchell, by his own admission, did nothing to make the sale of the Property unconditional by finding a buyer for the Purchasers’ property. The magistrate considered that the evidence established that the causal connection, between introduction to the Property by Mr Mitchell and ultimate sale of it to the Purchasers, was broken.
  1. [51]
    Further the magistrate found that:
  1. (a)
    It was Mr Keogh who realised that a buyer had to be found for the Purchasers’ property before there was any real chance that the respondents would consider a contract;
  1. (b)
    It was Mr Keogh who negotiated with the Purchasers and the respondents about the settlement date and the price which was ultimately accepted; and
  1. (c)
    There was “no break in the causal connection” between Mr Keogh’s efforts and the sale of the Property.
  1. [52]
    The magistrate therefore came to the conclusion that the appellant was not the effective cause of the sale of the Property. I agree.
  1. [53]
    It cannot be said that the initial actions of the appellant, through Mr Mitchell, flowed through such that it could be considered to be the ultimate cause of the sale. Rather, it appears that when Mr Mitchell informed the respondents of the potential contract as a result of his discussions with the Purchasers, the respondents openly refused a contract on the terms proposed (i.e. “subject to sale”). This event effectively broke the causal connection between the efforts of Mr Mitchell and the eventual sale.
  1. [54]
    It was the intervening actions and subsequent efforts of Mr Keogh that resulted in the actual sale, on terms acceptable to the Purchasers and respondents.

The Purchasers’ Evidence

  1. [55]
    Apart from the challenge to the learned magistrate’s conclusion, the only complaint about the judgment of the magistrate is that several parts of the oral evidence of the Purchasers was not included in the reasons of the magistrate, leading to an inference that the evidence was not considered by the magistrate.
  1. [56]
    The appellant submitted that the magistrate was obliged to take this evidence into account as the evidence of the Purchasers was the only evidence by which a court can assess whether the efforts of the first agent continued to influence the Purchasers in the eventual decision to purchase the Property. It was submitted that the Purchasers were the only independent witnesses who had no interest in the outcome of the litigation.
  1. [57]
    The evidence of the Purchasers relied upon by the appellant was their evidence that they would not have purchased the Property unless they had inspected it, and that Mr Keogh did not factor into their decision-making process in relation to the purchase or the price.
  1. [58]
    Contrary to this submission, however, the magistrate did refer to the fact that Mr Mitchell had organised the open house and the subsequent private inspection. The magistrate simply found that neither this, nor the fact that Mr Mitchell prepared and organised delivery of a contract to the Purchasers flowed through to the actual sale.
  1. [59]
    Further, it was not suggested by the Purchasers that Mr Mitchell had any input into the decision to purchase or the sale price either.
  1. [60]
    It was the actions of Mr Keogh which influenced and enabled the respondents and the Purchasers to conclude the sale.

Costs Appeal

  1. [61]
    Counsel for the respondents opposed leave being granted to the appellant to appeal the costs decision on the basis that the addition of the proposed ground was an attempt by the appellant to introduce what is, in essence, a fresh appeal against the final judgment, constituted by the costs orders made on 18 October 2019, out of time.
  1. [62]
    The appellant had provided the Amended Notice of Appeal to the respondents’ solicitors on 4 December 2019; albeit with a covering letter which said no more than that the appellant intended to seek leave at the hearing of the appeal to file the amended notice. There was no application for leave to appeal out of time in regard to the costs decision, nor was there an application for leave to amend the initial Notice of Appeal.
  1. [63]
    The appellant was permitted to make submissions with respect to costs on the basis that:
  1. (a)
    The appellant delivered their oral submissions at the hearing of the appeal;
  1. (b)
    The respondents were entitled to make written submissions in reply within 14 days’ of the date of hearing; and
  1. (c)
    The appellant would pay the respondents’ costs of the preparation of those submissions on an indemnity basis, with an affidavit to be provided as to the costs.
  1. [64]
    Subsequently, on behalf of the respondents submissions as to costs were made and an affidavit of David Matthew Carrick sworn 20 April 2020 was filed deposing to the costs incurred by his client in relation to those submissions, being an amount of $4990.20.

Unreasonable to Reject Offer

  1. [65]
    The test for unreasonableness of rejection of an offer of settlement was outlined by the Victorian Court of Appeal in Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2) (Hazeldene’s):

“The critical question is whether the rejection of the offer was unreasonable in the circumstances. We see no justification for a more stringent test such as “manifestly” or “plainly” unreasonable.[11]

  1. [66]
    In J & D Rigging Pty Ltd v AGRI Power Australia Limited[12] the Court of Appeal, in following Hazeldene, held that ordinarily a court considering the issue of unreasonableness of rejection of a Calderbank offer should have regard to at least the following matters:
  1. (a)
    the stage of the proceeding at which the offer was received;
  1. (b)
    the time allowed to the offeree to consider the offer;
  1. (c)
    the extent of the compromise offered;
  1. (d)
    the offeree’s prospects of success, assessed as at the date of the offer;
  1. (e)
    the clarity with which the terms of the offer were expressed; and
  1. (f)
    whether the offer foreshadowed an application for indemnity costs in the event of the offeree’s rejecting it.

Analysis

  1. [67]
    Deciding whether conduct is or is not reasonable involves matters of judgment and impression, and different judges might properly arrive at different conclusions.[13]
  1. [68]
    The test for unreasonableness is a matter “entirely appropriate to the exercise of a discretion”[14] and in an appeal against the exercise of a discretion, the appellant must be able to establish an appellable error.[15]  It is not enough that the appellate court would have taken a different course; what is required is that an error had been made in the exercise of discretion, in that the judge had acted upon a wrong principle, considered extraneous or irrelevant matters or had made a mistake of fact.[16]
  1. [69]
    It is accepted by both parties that the test and considerations as stated in Hazeldene’s are applicable, and there was no suggestion by the appellant that the learned magistrate had failed to correctly identify and apply the law in this regard, failed to take into account relevant considerations or took into account irrelevant considerations. 
  1. [70]
    The submissions made by the appellant were that, because the offer was made before a defence was filed, it was impossible to properly ascertain the strength of each party’s respective cases. It was submitted that it was an error for the magistrate to find that the appellant was sufficiently aware of all relevant factors to adequately assess its prospects of success at the time the offer was made.
  1. [71]
    The learned magistrate found that the appellant was aware of the following essential relevant facts:
  1. (a)
    That Mr Keogh had a previous agency of the Property, and the consequent competition amongst agents (Mr Keogh and Mr Mitchell) for the sale;
  1. (b)
    That the respondents did not want to enter a contract subject to the sale of the prospective Purchaser’s property;
  1. (c)
    that from 24 October 2017 the appointment was an open listing;
  1. (d)
    That Mr Mitchell did nothing to find a buyer who already had a contract for sale on their property and was willing and able to enter a contract to purchase the Property; and
  1. (e)
    That Mr Mitchell was not the agent who secured the eventual executed contract of sale of the Property.
  1. [72]
    There was no identification in the submissions, either in this court or below, as to what essential fact was said to be unknown to the appellant at the time of receipt of the offer. The only factual matter addressed in written submissions to the magistrate was that the case turned on the oral evidence of the respondents, their intentions and the conduct of third parties unknown to the appellant.
  1. [73]
    It is not known what information passed between the parties prior to the initiation of proceedings. The statement of claim alleges two letters of demand were sent in March 2018. They were not tendered. There was no evidence as to whether they elicited any response from the respondents. The letter of offer, perhaps unfortunately, does not state why the offer should be accepted.
  1. [74]
    On the available evidence, the inference is that the appellant sued for its commission purely on the basis it was entitled to it as the Purchasers had attended its open house, it had facilitated a private inspection of the Property by the Purchasers and it had prepared a draft contract which it had delivered to the Purchasers.
  1. [75]
    Against that, the appellant knew that the Purchasers wanted any purchase contract to be subject to the sale of their own property and the respondents would not accept such an arrangement. The appellant must be taken to be aware that somehow that impasse was resolved, and probably by Mr Keogh with whom both the respondents and the Purchasers had communicated with at the relevant time.
  1. [76]
    It has not been shown that the learned magistrate was not entitled to find that the appellant had all the essential facts to adequately assess its prospects. It is uncontroversial that the learned magistrate applied the correct test and in her reasons went to considerable lengths to consider each of the relevant factors. I find that the decision to order the appellant to pay indemnity costs was within a sound discretionary judgment.

Orders

  1. [77]
    For these reasons, I make the following orders:
  1. Appeal dismissed.
  2. The appellant to pay the first and second respondents’ indemnity costs in relation to the preparation of the costs appeal, fixed in an amount of $4,490.20.
  3. Otherwise, unless the parties make written submissions as to costs within 14 days of the date of this judgment, the appellant pay the costs of the first and second respondents of the appeal on the standard basis.

Footnotes

[1] The minor civil dispute limit is $25,000. See Magistrates Court Act 1921 (Qld), s 45(5); Queensland Administrative Tribunal Act 2009 (Qld), sch 3.

[2] See District Court of Queensland Act 1967 (Qld), s 113; Uniform Civil Procedure Rules 1999 (Qld), r 766, r 785(1).

[3] Allesch v Maunz (2000) 203 CLR 172, [23].

[4] Fox v Percy (2003) 214 CLR 118, 126.

[5] Fox v Percy (2003) 214 CLR 118; Warren v Coombes (1979) 142 CLR 531; Dwyer v Calco Timbers (2008) 234 CLR 124.

[6] Fox v Percy (2003) 214 CLR 118, 126-127.

[7] Emmons Mount Gambier Pty Ltd v Specialist Solicitors Network Pty Ltd [2005] NSWCA 117, [39] citing Burchell v Gowrie [1910] AC 614.

[8] (1977) 138 CLR 52, 86 (LJ Hooker).

[9] See LJ Hooker, 76.

[10] Moneywood Pty Limited v Salamon Nominees Pty Limited [2000] 202 CLR 351, 361; referred to in Emmons Mount Gambier Pty Ltd v Specialist Solicitors Network Pty Ltd [2005] NSWCA 117, [39].

[11] (2005) 13 VR 435, 441 [23].

[12] [2014] QCA 23, [6].

[13] Hazeldene’s, [24].

[14] bid.

[15]House v The King (1936) 55 CLR 499, 504-505.

[16] Ibid.

Close

Editorial Notes

  • Published Case Name:

    Urban Property Agents Pty Ltd v Vann & Anor

  • Shortened Case Name:

    Urban Property Agents Pty Ltd v Vann & Anor

  • MNC:

    [2020] QDC 226

  • Court:

    QDC

  • Judge(s):

    Sheridan DCJ

  • Date:

    11 Sep 2020

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.
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