Burney v The London Mews Company Ltd. Rev 1

An estate agent may introduce a purchaser to the sale transaction by supplying property particulars. The purchaser’s later direct approach to, and negotiations with, the vendor do not necessarily break the causal chain or defeat commission. The relevant question is not always which act was the effective cause of the bargain. Where the agent lawfully prepared and supplied the particulars, unauthorised conduct by an intermediary does not make the claim depend on the agent’s own wrongful conduct. The reasoning in McCann v Pow [1975] 1 All ER 129 is confined to reliance on an unauthorised subagent and unauthorised conduct. Alternatively, “another agent” may include an estate agent not instructed by the vendor.

London Mews appointed itself as the sole estate agent for the sale of the defendant’s property. The agreement provided for commission where a purchaser was introduced by London Mews or by another agent during the sole-agency period. London Mews prepared and circulated property particulars and advertised the property. Kaye & Co obtained the particulars, altered them and circulated them to a prospective purchaser, who later contacted the vendor directly and purchased the property.

A District Judge refused to set aside London Mews’s default judgment for commission. His Honour Judge Richardson dismissed the defendant’s appeal on 4 December 2002. The Court of Appeal considered whether London Mews had introduced the purchaser and, alternatively, whether the purchaser had been introduced by another agent within the agreement.

The appeal was dismissed unanimously as to the result. Lord Justice Waller gave the leading judgment, and Lord Justice Kay agreed with his conclusion and reasons. Mr Justice Lindsay agreed in the result but relied on an alternative contractual analysis.

1. Introduction of a purchaser. The agreement was concerned with introduction to the transaction, rather than merely the first personal contact between purchaser and property. The supply of particulars could therefore amount to an introduction even where the purchaser later approached the vendor directly and conducted the negotiations without the estate agent’s involvement. The fact that later negotiations were an effective, or even the effective, cause of the bargain did not necessarily displace the original introduction.
2. Effect of Kaye & Co’s conduct. London Mews had lawfully prepared the particulars, advertised the property and supplied the particulars to Kaye & Co. Kaye & Co’s unauthorised alteration and wider circulation of the particulars did not break the chain of causation. London Mews was not relying on its own wrongful appointment of an unauthorised subagent, so the reasoning in McCann v Pow [1975] 1 All ER 129 was distinguishable.
3. John D Wood v Dantata. The guidance in that case on introduction and effective cause had to be viewed in its factual context. It did not justify the broader submission that later negotiations necessarily defeated an earlier introduction. The original supply of the particulars was sufficient on the facts.
4. Alternative ground. Mr Justice Lindsay considered that the phrase by another agent was wide enough to include another estate agent who was not instructed by the vendor. Commercial good sense supported that construction, since otherwise commission could too easily be avoided after substantial work by the first agent.

The appeal was dismissed. Costs were summarily assessed at £3,450.97, payable by the appellant within 14 days from the sum in court, with interest.

1. Court of Appeal (Civil Division) — [2003] EWCA Civ 766, 7 May 2003: dismissed the appeal and upheld the commission judgment.
2. Ilford County Court — His Honour Judge Richardson, 4 December 2002: dismissed the defendant’s appeal from the District Judge.
3. Ilford County Court — District Judge Sherratte, 5 September 2002: refused to set aside London Mews’s default judgment for commission.