Agent Gaile Huskins agreed to a discounted $5,500 commission per townhouse sold in a sole agency arrangement for a small townhouse development in Zillmere, Brisbane.
By June 2007, after the sole agency agreement had expired, the developer decided to consider an open listing for the remaining apartments at the standard commission rate.
He signed a form 22A relating to the agent’s appointment in an open listing that provided for payment of standard commission. However the developer alleged he did so on the understanding reached in a discussion with the agent that she only be entitled to commission at the higher rate, if he did in fact appoint other agents.
Huskins made a further sale before any other agents were appointed. The developer paid the discounted commission of $5,500 but the agent claimed a balance of $4,500 to make up the difference to the standard commission rate.
The developer resisted payment of the additional commission and the agent sued him in the Magistrates Court. Naturally enough, the developer sought in his defence, to rely on PAMDA compliance hurdles.
The magistrate ruled against Huskins on the PAMDA points saying that because:-
- the form 22A appointment did not state, both as a percentage and as an amount, the commission that would have been payable in the event of a sale; and
- no copy of the signed 22A was given to the developer
she was not entitled to recover any commission.
On appeal to the District Court*, the agent sucessfully overturned these rulings.
The failure to state the amount of the commission in circumstances where the percentage only was stated, was held to be a breach of PAMDA section 133 (3) but at the same time, amounted to “substantial compliance” within the requirements of section 49 of the Acts Interpretation Act. This decision conforms with two earlier District Court decisions to the same effect on the very same point – so she was not disentitled to commission on this ground.
Further, non-compliance with section133 (8) i.e. failure to provide a copy of the 22A to a seller, was held not to affect the validity of the appointment even though the failure is also subject to a penalty.
So far the appeal was going the agent’s way.
However the court upheld the evidence of the developer over that of the agent over what had been agreed: The oral qualification for payment of standard commission, only in the event that other agents were appointed, was upheld. As none had in fact been appointed, the court ruled that the only commission payable was that at the discounted rate.
The peak of the mountain is very high indeed!
* Huskins v Mid North Developments Pty Ltd  QDC 493