The Supreme Court considered whether an oral agreement between vendor and estate agent was sufficiently certain as to be binding.
An estate agent brought proceedings against his client for non-payment of commission. Following a telephone call between them, the agent had successfully found a purchaser for the client’s flats. In that call the parties had agreed that the agent’s commission of 2% plus VAT but the trigger event for payment had not been discussed.
The vendor argued that the absence of this information made the relationship too uncertain for the obligation to pay commission to be binding.
The Supreme Court held that as a matter of interpretation the commission was payable on completion of the sale. Although interpretation disputes usually turn upon drafting the context and conduct of the parties could also be relevant. In this case a reasonable person would have understood the parties to have meant for completion to trigger the right to payment with the amount due would be paid out of the proceeds of sale. The contract was sufficiently certain and complete to be enforceable.
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