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Contract- Agency-Estate broker-Authority to 'negotiate a sale' and 'secure purchaser· '-Whether empowers broker to conclude contract -Construction of contract-Broker finding out purchaser ready and willing to buy for price fixed by principal-Principal concluding contract with same purchaser for lower price-Broker's right to commission-Powers of estate agents.The appellant, an estate broker, was employed by the respondent by a letter dated 5th May, 1943, to negotiate a sale of a certain property on the terms mentioned in a commission note which ran as follows: "I ...... do hereby authorize you to negotiate the sale of my property 27, Amratolla Street, free from all encumbrances at a price not less than Rs. 1,00,000. I shall make out a good title to the property. If you succeed in securing a buyer for Rs. 1,00,000, I shall pay you Rs. 1,000 as your remuneration. If the price exceeds Rs. 1,05,000 and does not exceed Rs. 1,10,000, I shall pay you the whole of the excess over Rs. 1,05,000 in addition to your remuneration of Rs. 1,000 as stated above. In case you can secure a buyer at a price exceeding Rs. 1,10,000 I shall pay you twenty-five percent of the excess amount over Rs. 1,10,000 in addition to Rs. 6,000 as stated above. This authority will remain in force for one month from date." In pursuance of this contract the appellant found two persons ready and willing to purchase the property for Rs. 1,10,000 on the 2nd June and by letters exchanged with them he purported to conclude the contract for the sale of the property, and on the 3rd June communicated the same to the respondent. The respondent, however, cancelled the authority or the appellant on the 9th June and on the same date entered into an agreement with a nominee of the said persons for a •ale of the property for Rs. 1,05,000 and eventually executed a conveyance in their favour for Rs. 1,05,000. The appellant instituted a suit against the respondent for Rs. 6,000. Held, per KANIA C.J., FAZL ALI, PATANJALI SASTRI and DAS .JJ.-(i) that a house or estate agent is in a different position from a broker at the Stock Exchange owing to the peculiarities or the property with which he has to deal, and an owner employing an estate agent should not, in the absence of clear words to that effect, be taken to have authorized him to conclude a contract or sale; but the lack of such authority is not inconsistent with an understanding that the agent is not to be entitled to his commission unless the owner and the purchaser introduced by the agent carried the transaction to completion; (ii) that even if the commission note in the present case were to be construed as making payment of commission conditional on the completion of the transaction, the appellant having "negotiated the sale" and "secured buyers" who made a firm offer to buy for Rs. 1,10,000, acquired. the right to the payment of commission on the basis of that price subject only to the condition that the buyers should • complete the transaction of purchase and sale ; and as this condition was fulfilled when the buyers eventually purchased the property in question; the appellant's right to commission on that basis became absolute, and could not be affected by the circumstance that the respondent for some reason of his own sold the property at a lower price. MAHAJAN J.-Under the terms of the commission note in the present case the appellant had authority to enter into a binding contract on behalf of the defendant, and, as he had entered into such a contract he was entitled to the commission of Rs. 6,000 according to the terms of the commission note. Even conceding that he had no such authority, under the terms of the commission note the agent was entitled to his remuneration as soon as he introduced a buyer ready and willing to purchase for the price fixed by the owner, whether the owner completed the transaction or not. |
