A case summary written by Danisha Naidu and checked by Heather Hepburn
Background
Mr Pather (the “Appellant”) was successfully sued in the court a quo by Wakefields Real Estate (Pty) Ltd (the “Respondent”) which was duly represented by its employee, Ms Gunpath. The Appellant was sued for the payment of the estate agent’s commission as a result of the sale of his property.
The Appellant and Ms Gunpath lived on the same road as one another and knew each other in passing. The Appellant was aware of the fact that Ms Gunpath was an estate agent as he had witnessed her marketing and introducing prospective purchasers to the property next door to his own.
On or about August 2012, the Appellant and Ms Gunpath (acting in her capacity as an employee of the Respondent) entered into an oral agreement, in terms of which, the Appellant requested Ms Gunpath to find a buyer for his property situated at 162 Damarosa Crescent, Moorton, Chatsworth (‘the Appellant’s property);
Pursuant to the above oral mandate, Ms Gunpath introduced Mr and Mrs Gajraj (the “Purchasers”) to the Appellant’s property. The couple was looking to purchase a home for their son. Ms Gunpath alleged that the Purchasers were interested in the Appellant’s property, but found that his asking price of between R900 000.00 – R950 000.00 was out of their budget.
On or about January 2013, Ms Gunpath noticed that car of the Purchasers’ son was parked outside the Appellant’s property. She soon found out that the Purchasers had purchased the Appellant’s property without informing her of the sale. In an effort to obtain the commission that was entitled to the Respondent in terms of the oral mandate, Ms Gunpath was advised by her employer (Mr Lomax) to have the Purchasers sign letters confirming that Ms Gunpath introduced them to the Appellant’s property and that they subsequently purchased the property for R785 000.00 (Seven Hundred and Eighty-Five Thousand Rand) on or about the 14th of August 2012 and without having informed Ms Gunpath of the sale thereof. The Purchasers signed the letters and they served as evidence when the Respondent successfully sued the Appellant for R67 117.50 (Sixty Seven Thousand One Hundred and Seventeen Rand Fifty Cents), being the estate agent commission of 7.5% plus VAT of the purchase price of the Appellant’s property, being the recommended tariff of estate agents in performing their functions as such
The Appellant appealed the decision of the court a quo, alleging that the Respondent was not entitled to estate agents commission on account of there being no written mandate between himself and the Respondent to sell his property.
Legal Question
Will an oral mandate to sell a property entitle an estate agent to earn commission?
Judgment
The Court held that the Appellant’s misconception that the Respondent would only be entitled to a commission if the mandate was in writing, was “ill-conceived” and that the Appellant’s communications with Ms Gunpath, in relation to the sale of his property, were tantamount to an oral mandate.
The Court held further that Ms Gunpath had duly discharged her mandate by introducing the willing and able Purchasers to the Appellant’s property and was accordingly entitled to the payments of the amounts referred to in the judgment of the court a quo.
The Appeal was accordingly dismissed with costs.
Value
The successful sale of a property resulting from an oral mandate, does entitle the estate agent to earn a commission, provided that there is sufficient proof that the estate agent is the effective cause of the sale of the property and has discharged their mandate.
