A real estate agent who introduced a buyer for a prize Gold Coast development site has been denied his share of commission because of the way he completed the conjunction agreement.

Scott Westwood secured agreement in October 2019 from the exclusive selling agent Equity 2, to receive one third of the $440k commission on the sale of the iconic Cav’s Steakhouse site in Brett Avenue Labrador.

Westwood completed a pro forma conjunction agreement noting his company Best Price Real Estate Pty Ltd as conjunction agent and E2 as the listing agency.

His prospect, Trevato Pty Ltd – which was specified in the conjunction agreement – signed up for the $8.35mil buy in October 2019 but could not obtain a suitable valuation to secure development finance.

Trevato’s owner then formed a new company and enlisted the support of marina developer Arthur Lowe in a joint venture to acquire and develop the site. It was Lowe’s company Aeone Pty Ltd that signed a new contract for its acquisition at the end of December 2019 at the lower price of $7.5mil.

When that contract duly completed on 16 January 2020, Westwood was skillful enough to have the seller pay $176k of the total $330k GST inclusive commission to Best Price.

Listing Agent E2 promptly demanded those funds be returned to it claiming Best Price had no claim to any part of the commission and had received the funds under duress.

It contended that because Westwood had specified his prospect’s name in a special condition rather than in the space provided for “client”, the agreement pertained only to Trevato as buyer and not – as would have been the usual case – any other buyer he introduced.

Thus, it argued, Best Price did not qualify for payment on the sale to Aeone Pty Ltd even though Westwood had introduced it as the ultimate buyer.

The dispute came Judge David Kent QC in the District Court at Southport in July.

In proceedings that occupied nearly 5 hours “on a busy application day” – much to his Honour’s disapproval – Best Price countered that the agreement “contemplates a situation where the eventual purchaser of the property is not the same entity as the prospective purchaser named in the agreement”.

It further asserted that any inconsistencies were “cured” by a number of implied terms including the parties will act in good faith and cooperate to give business efficacy to the agreed terms.

The court considered it was “not reasonable and equitable that [Best Price] be entitled to commission “simply by virtue of their unfruitful efforts”.

Judge Kent was not prepared to imply any terms into the agreement because they were not necessary to give it business efficacy at all. Neither were the things suggested “so obvious that they went without saying”.

The sale was to a party different to that specified in the conjunction agreement and therefore Best Price was disqualified – on its plain meaning -from receiving any part of the commission.

It was ordered to repay what has received to E2 and pay its costs of the court proceedings.

Equity 2 Pty Ltd v Best Price Real Estate Pty [2020] QDC 180 Kent QC DCJ 3 August 2020


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