Case LawGhana
CYRIL ROBERT HALM VRS MULTICHOICE GHANA LTD & ANOR (J4/70/2023) [2024] GHASC 18 (29 May 2024)
Supreme Court of Ghana
29 May 2024
Judgment
IN THE SUPERIOR COURT OF JUDICATURE
IN THE SUPREME COURT
ACCRA – A.D. 2024
CORAM: BAFFOE -BONNIE JSC (PRESIDING)
PROF. MENSA-BONSU (MRS.) JSC
KULENDI JSC
ASIEDU JSC
DARKO ASARE JSC
CIVIL APPEAL
NO. J4/70/2023
29TH MAY, 2024
CYRIL ROBERT HALM ……… PLAINTIFF/RESPONDENT/RESPONDENT
VRS
1. MULTICHOICE GHANA LTD. …… 1ST DEFENDANT/APPELLANT/APPELLANT
2. NANA BOADU AYEBOAFO … 2ND DEFENDANT
JUDGMENT
DARKO ASARE JSC:
1. My Lords, this is an appeal from a judgment of the Court of Appeal in an action
brought by the Respondent, against the Appellant, for remuneration for services
in connection with his trade as an estate agent. The Court of Appeal had
affirmed the findings and conclusions by the trial court which made an award
of 5% commission in the Respondent’s favour. This followed what was
determined by the Court to be a successful brokerage of a transaction that
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concluded with the Appellant’s purchase of the land in question at a price of
USD$2.5m.
2. The facts germane to this appeal have been adequately set out in the judgment
of the Court of Appeal, and we would only highlight the salient points necessary
for the determination of the issues raised in this appeal.
3. The Respondent at all material times was an estate agent, whilst the Appellant,
was a limited liability company, engaged in the business of providing multi-
channel pay television platforms to its subscribers. According to the Respondent
he was approached by Officials from the Appellant company sometime in July
2012, who were desirous of engaging his services to assist the Appellant acquire
land along the N1 Ablemkpe Interchange for purposes of constructing
Appellant’s office premises.
4. Before the trial court, the Respondent asserted that through his diligent efforts,
he succeeded in identifying a suitable land at the Abelempke Interchange
suitable for the Appellant’s purposes. After conducting an official search to
satisfy himself that the land was not emcumbered, he prepared a site plan on
the land for the Appellant. Following the Appellant’s confirmation that it was
interested in acquiring the land in question, the Parties settled on an agreed
commission. Thereafter the Respondent arranged a meeting with the owner of
the land, the 2nd Defendant in the suit, who agreed, after negotiations, to sell
the land at USD$3m and further agreed to pay Respondent a commission of 5%
of the purchase price. According to the Respondent, he subsequently handed
over the 2nd Defendant’s telephone number to the Appellant’s General Manager
to enable one Yaw Boakye who knew the 2nd Defendant very well, to intervene
in the transaction and convince the 2nd Defendant to reduce the purchase price
of the land. Respondent claimed that even though he did not have a written
contract with the Appellant he gave out the number out of good faith, and this
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enabled the said Yaw Boakye to negotiate with the 2nd Defendant to reduce the
purchase price from USD$3m to USD$2.5m. Contending that the Appellant was
unwilling to pay him the agreed commission of 5% even though the transaction
had been concluded, the Respondent instituted this instant action for redress.
The prayer for relief follows on from the particulars of the claim. This seeks an
order for recovery of the sum of One Hundred and Twenty Five Thousand United
States Dollars (USD$125,000.00) being 5% commission of the value of the land
in question, interest, and costs.
5. On the 7th of April 2017, the Appellant delivered an amended defence which
essentially set out a factual narrative. In the main it asserts that it was rather
the Respondent who approached the Appellant about the sale of the land in
question. The Appellant not only denied entering into any agency contract with
the Respondent, but also denied agreeing to pay any commission to the
Respondent as alleged or at all. Appellant further denied that the Respondent
played any role in brokering the purchase of the land from the 2nd Defendant,
and that it was after the transaction had been concluded that he started making
demands on the Appellant’s General Manager for finder’s fees, which was
refused.
6. The 2nd Defendant on his part denied having had any business dealings with the
Respondent, contending that even though he had been contacted by many
estate agents with regards to the sale of the land in question, he had not
entered into any agreement with them.
7. At the end of the trial, the learned trial judge expressed himself as having found
favour with the Respondent’s case, and held that he was entitled to have his
remuneration assessed at a commission of 5% of the value of the property in
question which worked out to the tune of USD$125,000.00.
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8. Regarding the 2nd Defendant however, the trial court reached the significant
conclusion that the Plaintiff had failed to prove that he had been engaged by
the 2nd Defendant, nor had he rendered any services for the 2nd Defendant.
9. The Court of Appeal affirmed the decision of the trial court, reasoning that
sufficient evidence existed on the record to justify those findings of fact.
10. Against the Court of Appeal’s decision, the Appellant has lodged this appeal and
has invited us to say that the decision was erroneous. He formulates two main
grounds of appeal.
i) The judgment is against the weight of the evidence
ii) The Court of Appeal erred by ordering payment of the sum claimed
by the Plaintiff/Respondent/Respondent since there was no
agreement between the Parties and the
Plaintiff/Respondent/Respondent neither claimed on quantum meruit
nor led any evidence to establish the value of the work actually
rendered by him.
CONSIDERATION OF MERITS OF APPEAL BY THIS COURT
11. The Appellant herein having attacked the judgment of the Court of appeal as
being against the weight of the evidence on the record, we must commence
this delivery by reminding ourselves that an appeal is by way of re-hearing and
the task assumed by this Court, is to analyse the whole record of appeal, take
into account the testimonies and all documentary evidence adduced at the trial,
so as to satisfy ourselves that on the preponderance of probabilities, the
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conclusions of the court below was reasonable or amply supported by the
evidence. See Tuakwa v. Bosom [2001-2002] SCGLR 61.
12. Before us learned Counsel for the Appellant advanced a number of arguments
in his bid to impeach the judgment of the Court of Appeal. We will however
subsume his submissions under two major points. His principal submission was
that in the absence of an agreed consideration, there was no valid contract
between the Appellant and the Respondent to warrant the award of the 5%
commission. According to learned Counsel the evidence on record showed
clearly that there was no agreed remuneration for the services rendered by the
Respondent and that a critical aspect of the agreement having been left
undetermined, no valid contract could be said to have been proved. In urging
us to interfere with the decision of the Court of Appeal on this point, learned
Counsel concluded his submissions as follows:-
“It is clear from the authorities that for there to be a valid contract there
ought to be a concluded bargain with no essential terms outstanding. And
from the amended statement of claim to the last correspondence between
the Parties, i.e. Exhibit “B”, it is clear that a fundamental element of
consideration had not been agreed upon”
13. Learned Counsel for the Appellant next argued that having played only a limited
role in the transaction and without a valid contract, the Respondent could only
claim on quantum meruit but failed to do so. On this point, learned Counsel
contended that, having failed to sue in quantum meruit and proved the value of
the work done, the award of 5% commission made in his favour by the Court
of Appeal was in the circumstances of this case, aberrant. Learned Counsel
concluded by inviting this Court to interfere with the entire decision delivered
by Court of Appeal.
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14. Learned Counsel for the Respondent countered by saying that sufficient
evidence existed on the record to support the trial court as well as Court of
Appeal’s finding that an enforceable contract existed between the Parties.
According to learned Counsel, having successfully brokered the sale transaction
between the Appellant and the 2nd Defendant, the Respondent was entitled to
be paid his agreed commission of 5% of the value of the land in question. On
the issue as to whether or not the Respondent was entitled to recover on
quantum meruit basis, learned Counsel invites this Court to reject Appellant’s
contentions. This is because, so the argument run, the issue of quantum meruit
was not raised at the trial, since the gravamen of the Appellant’s defence at the
trial was mainly that it had not entered into any contract with the Respondent.
In the end learned Counsel for the Respondent contended that no valid reasons
existed for interfering with the concurrent findings by the trial court and the
Court of Appeal. He concluded by urging us to dismiss the appeal in its entirety.
CONSIDERATION OF ISSUES
15. In our considered view, the fundamental issues to be resolved in this appeal,
after a careful examination of the grounds of appeal, alongside the record of
appeal as well as the submissions filed by learned Counsels for the Parties
herein, can be stated thus:—
i) Whether there was no binding contract as the Respondent failed to
prove consideration
ii) Whether the Court of Appeal erred by affirming the trial court’s
award of 5% commission in favour of the Respondent
iii) Whether in the absence of an endorsed claim for quantum meruit,
the Respondent was not entitled to any award for work done.
The focal point of this delivery will therefore be directed at answering the central question
whether the Appellant is liable to pay the Respondent any agreed commission for services
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rendered for the benefit of the Appellant, and if not whether a claim could lie in quantum
meruit for such services.
WHETHER THE RESPONDENT FURNISHED VALUABLE CONSIDERATION TO
SUPPORT A VALID CONTRACT BETWEEN THE PARTIES
16. It cannot be disputed that the evidence on record did indicate that sometime in
July 2012, the Appellant, through its Architect, one Andrew Prah, and one
Edward Owusu, contacted the Respondent and engaged his services to find the
Appellant a suitable land along the N1 Ablemkpe Interchange to purchase
17. Unfortunately the Parties did not reduce the nature of their agreement into
writing. Accordingly there was no written document from which the express
terms of their engagement could be determined.
18. The duty of this Court is therefore to peruse the record of appeal, and as far as
possible, to identify from the established evidence, exactly what was the nature
of the relationship between the Parties and the terms and other conditions
thereof.
19. At this re-hearing, Learned Counsel for the Appellant presses on this Court the
argument that there was no contract because of the absence of consideration
in the form of agreed remuneration for the services to be rendered by the
Respondent.
20. As earlier pointed out, the Court of Appeal had affirmed the findings made by
the trial court, and had come to the following conclusion:-
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“We find from the above that there is credible evidence to indicate that the
Appellant and the Respondent had a contract and therefore the learned
High Court Judge did not err in so holding”
21. The evidence on which the Court of Appeal found the existence of a valid
contract between the Parties, was based on the fact that the Appellant had
engaged the services of the Respondent to find a suitable land for the Appellant
to purchase; pursuant to Appellant’s express request, Respondent had used his
services as an estate agent to identify the land in question for the Appellant;
Respondent had also conducted appropriate due diligence to ensure that the
land was free from encumberances; Respondent had thereafter prepared a site
plan on the land for the Appellant; and Respondent had also pointed out the
owner of the said land to the Appellant.
22. We have for ourselves carefully reviewed the findings and conclusions of the
Court of Appeal and tested them against the established evidence on the record
in this appeal. We are satisfied that sufficient evidence exists on the record to
justify the above findings of fact. We have also reminded ourselves that being
concurrent findings of fact made by both the trial court as well as the
intermediate appellant court, we must be slow to interfere with such findings
unless they are perverse, which we have not found to be so in this case. See
cases like Obeng & Others v Assemblies of God Church, Ghana [2010]
SCGLR 300 at 409; Ntiri v Essien [2001-2002] SCGLR 459; Sarkodie v
F K A Co Ltd [2009] SCGLR 79; Awuku-Sao v Ghana Supply Co Ltd
[2009] SCGLR 713; Gregory v Tandoh IV [2010] SCGLR 971].
23. Beyond the fact that the findings and conclusions by the Court of Appeal on this
issue are well borne out by the evidence on record, we are also persuaded that
the Court of Appeal’s conclusions are sanctioned by well settled principles of
contract law.
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24. Proceeding even by the most rudimentary principles of contract law, we fail to
appreciate learned Counsel’s submissions that the agreement between the
Parties in this case was devoid of valuable consideration.
25. From the pleadings and evidence adduced at the trial, it was common ground
that the nature of the transaction sued on is one of agency, with the Appellant
engaging the services of the Respondent to use his best endeavours to prospect
for suitable property for the Appellant to purchase for use as its office premises.
26. Of course like all ordinary contracts, a contract of agency, acquires its validity
from satisfying certain essential legal requirements, ie, offer, acceptance,
consideration and not least important, an intention to create legal relations.
Again, like every other contract it can come into being either orally or in writing
or it can even be implied from the conduct of the Parties.
27. As to whether or not the agency contract between the Parties herein was
supported by valuable consideration, we need no more than refer to perhaps
one of the basic definitions of the concept of consideration, by the learned
authors J. C. Smith & J. A. C. Thomas (citing an article by C. J. Hamson (1938)
54 L. Q. R. 233) in their book “A Casebook on Contract” (Sweet & Maxwell) at
page 143, thus:-
“Indeed consideration may conveniently be explained as merely the
acceptance viewed from the offeror’s side. Acceptance is defined to be the
doing of that act (which may be the giving of a promise or the rendering of
a performance) which is requested by the offeror in exchange for his
promise; it is the response to the offer. An act done at the request of the
offeror in response to his promise is consideration; and consideration in its
essence is nothing else but response to such a request.”
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28. A valuable consideration in the sense of the law:-
“…….. may consist either in some right, interest, profit or benefit accruing
to one party, or some forbearance detriment, loss or responsibility given
suffered or undertaken by the other” See Currie v Misa [1875] L. R. 10
Ex. at 162
29. It would therefore appear that an act or forbearance of the one party or the
promise thereof, is the price for which the promise of the other is bought; and
the promise thus given for value is enforceable. See the views of Lord Dunedin
in Dunlop v Selfridge [1915] A. C. 847 H.L.
30. Relating the principles deducible from the above authorities to the facts on
record in this instant suit, there was clear evidence of an agreement between
the Parties whereby the Respondent was to act as an estate agent for the
Appellant and prospect for suitable property for the Appellant’s use as its offices.
This agreement of course incorporated an implied promise by the Appellant,
which was accepted, that the Respondent was to be remunerated for the
services to be rendered under the agency contract
31. Based on this agreement, the Respondent did apply his efforts to identify and
locate the land in question. Not only that, he took steps to ensure that the land
was not encumbered; he proceeded further to procure a site plan of the land
which he handed over to the Appellant; and also ensured that the identity of
the owner of the land was disclosed to the Appellant.
32. Going therefore by the quite simple definition of consideration by the learned
authors J. C. Smith & J. A. C. Thomas in their book “A Casebook on Contract”
(Sweet & Maxwell) referred to above, the Court of Appeal could hardly have
been mistaken, when based on all the evidence on record it came to the
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conclusion that an enforceable agreement, satisfying all the basic elements of a
valid contract, existed between the Parties in this case.
33. In reaching the conclusion that there existed a valid contract between the
Parties, the Court of Appeal further took account of the contents of Exhibit “B”
which was an e-mail exchange dated the 14th of September 2012, between the
Respondent and the Appellant’s General Manager.
34. In the said exhibit, the Respondent recounted the antecedents leading to the
engagement of his services as an estate agent and reiterated his demand for
confirmation of payment for his services. In response the Appellant through its
General Manager stated as follows:-
“I mentioned we will meet sometime after next Tuesday and negotiate a
suitable rate as I did mention some constraints for your services. I also have
to consider what Nana gives since he had assured me he would handle all
the agents finder but please lets know what happens next week”
35. The relevance of Exhibit “B” lies in the fact that it stipulates an
acknowledgement and an undertaking by the Appellant to pay the Respondent
reasonable remuneration for the services he rendered as an estate agent.
36. In the case of Re Casey’s Patents; Stewart v Casey [1892] 1 Ch. 104,
Bowen LJ explained the legal effect of a similar undertaking to pay for past
services in the following manner:-
“Now the fact of a past service raises an implication that at the time it was
rendered it was to be paid for, and if it was a service which was to be paid
for, when you get in the subsequent document a promise to pay, that
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promise may be treated either as an admission which evidences or as a
positive bargain which fixes the amount of that reasonable remuneration
on the faith of which the service was originally rendered…”
37. We are satisfied that the above proposition of the law articulated by Bowen LJ,
furnishes adequate authority to buttress the conclusions reached by the Court
of Appeal that there existed between the Parties, a valid contract satisfying all
basic elements of the law.
38. With the above exposition of the facts and the law, there is no doubt that the
resolution of the issue as to whether the agency contract between the Parties
failed for lack of consideration must be resolved against the Appellant.
39. This means that the Appellant’s bid to avoid payment for services rendered by
the Respondent on the ground solely that there existed no valid enforceable
contract between the Parties lacks merit and must be rejected.
40. The result of our conclusions above is that the first point raised by learned
Counsel for the Appellant fails.
41. We will now turn to address the next leg of the Appellant’s appeal which
complains that the Court of Appeal fell into error when it affirmed the award of
5% commission in favour of the Respondent.
WHETHER THE COURT OF APPEAL ERRED BY AFFIRMING THE AWARD OF 5%
COMMISSION IN FAVOUR OF THE RESPONDENT
42. In order to adequately address the Appellant’s complaints under this leg of the
appeal, it may perhaps be worthwhile to conduct a cursory examination into the
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rights of an estate agent to recovery of remuneration for work done under an
agency contract.
43. The general attitude of the courts is that there is ordinarily a duty imposed on
a principal to pay his agent any remuneration or commission, contractually
agreed upon in the agency contract.
44. Even where there exists no express term as to remuneration, it is generally
accepted that there is an implied agreement to pay remuneration whenever a
person is employed to act as an agent under circumstances which raise a
presumption that he would, to the knowledge of the Principal, have expected to
be paid.
45. The above principle was lucidly explained by Lord Atkin in the case of Way v
Latilla [1937] 3 All ER 759, at 763, in the following manner:-
“But, while there is, therefore, no concluded contract as to the
remuneration, it is plain that there existed between the parties a
contract of employment under which Mr Way was engaged to do
work for Mr Latilla in circumstances which clearly indicated that
the work was not to be gratuitous. Mr Way, therefore, is entitled
to a reasonable remuneration on the implied contract to pay him
quantum meruit.”
See also the case of L. J. Hooker Ltd v W. J. Adams Estates Ltd [1977] 138 C.L.R.
52, 74-74.
46. The amount of payment for work done by the agent, and the conditions under
which payment would be effected would depend on the circumstances of each
case.
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47. If there is a custom or usage of a particular trade regulating payment of
remuneration, it may be presumed in the absence of any express agreement to
the contrary, that the Parties contracted for the payment of remuneration in
accordance with this custom or usage. See Re Wolfe; Heller v Wolfe [1952]
2 All ER 545; Hugh v Allen [1968] 1 Lloyds Rep. 348.
48. It may however be instructive to observe that the existence of such a custom
or usage is not easily proven. To establish custom or usage, there must be
positive and cogent evidence on the record that it is reasonable, certain and
notorious. In fact the evidence must establish that it was so well recognized
that it ought to have been known to both Parties. See Wilkie v Scottish
Aviation [1956] S.C. 198; Debenham v King College, Cambridge
[1884] 1 T.L.R. 170; Drew v Josolyne [1888] 4 T.L.R. 717 See also Chitty
on Contracts Vol. II; Specific Contracts page. 92
49. It follows therefore that in the absence of proof of such a custom or usage and
in the absence of express agreement, then a reasonable remuneration is
payable. See Brown v Nairne [1839] 9 C.&P 204; 205.
50. The Court of Appeal in rejecting the Appellant’s attack against the trial court’s
award of 5% commission in favour of the Respondent, had stated as follows:-
“Also DW1 testified that he suggested a commission of 5% to10% of the
sale value of the property from the perspective of an architect when the
Appellant nd the Defendant called him to confirm a suitable commission for
the Plaintiff (pages 207, 208, and 210 of the record of appeal. This is further
buttressed at page 199 of the record of appeal where the Appellant’s
representative when asked whether the Plaintiff proposed a fee of 5% he
replied in the affirmative and when asked whether he gave a counter
proposal his response was that he did not mention a figure because he
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wanted the whole transaction concluded since they did not have a formal
arrangement and they also had to look at the cost of the transaction. From
the above there is no merit in these grounds of appeal and we accordingly
dismiss them”
51. Learned Counsel for the Appellant viscerally assails the above conclusions
reached by the learned Justices of the Appeal. He contests the decision from a
number of standpoints but the major grounds on which we think this appeal
essentially turn, are mainly threefold.
52. In the first place the Appellant contends that having acted as a double agent
both for the Appellant as well as the 2nd Defendant, the Respondent was not
entitled to any recovery. The Appellant next argues that since the Respondent
failed to fully complete the services required of him as an estate agent in this
case, he could not be entitled to any commission, at all, whether agreed upon
or not. Thirdly learned Counsel contends that since the Respondent did not also
sue in quantum meruit, he stood to recover nothing for any of the services
rendered under the agency contract for the benefit of the Appellant.
Allegation that Respondent acted as a double agent.
53. In his Statement of Case, learned Counsel for the Appellant argued that the
Respondent’s claim in this case sinned against well established rules of agency
law which frown on an agent acting as a double agent both for his Principal and
other third parties involved in the transaction.
54. Having however thoughtfully examined the reasoning behind learned Counsel’s
arguments on this point, our respectful opinion is that those submissions
represent an insular view of the facts on record.
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55. To begin with, both in his pleadings and evidence adduced at the trial, the 2nd
Defendant vehemently contended that he never had any dealings with the
Respondent, neither did he pay any commission to him. This is how the 2nd
Defendant testified at the trial under cross examination:-
Q: It was agreed in those series of meetings that the 1st Defendant was
to bear the cost or payment of the taxes on the sale transaction
whiles you were to be responsible for payment of commission or
finder’s fee or other charges?
A: That is not correct. There wasn’t any agent involved in this
transaction. In cross examination you made mention of one Mr Yaw
Boakye that man was the only person I know about this transaction.
He came to me and asked me whether I will sell the said property to
Multi Choice but he did not come as an agent because I know this
Nana Yaw Boakye for a long time and has been my friend for so
many years. He came as a (sic) request whether I will sell the
property to Multi Choice but not as an agent
Q: So Yaw Boakye was not paid any commission
A: No.
56. Strikingly the trial Judge himself, and justifiably so, found no evidence that there
was any agreement between the Respondent and the 2nd Defendant. This
finding of fact was made very clear in his judgment, when he stated as follows:-
“On the totality of the evidence on record, I find that there is no record of
any agreement between the Plaintiff and the 2nd Defendant”
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57. It may be useful to observe that no appeal had been lodged against the above
finding.
58. That being the case it is not clear which evidence on record informed the
Appellant’s assertion that the Respondent was a double agent both for the
Appellant, as well as the 2nd Defendant the owner of the land in question. It
would seem therefore that the Appellant’s complaint that the Respondent acted
as a double agent has been made at large, not supported by any credible
evidence on the record.
59. The point was taken before us in argument by Learned Counsel for the Appellant
that the arrangement between the Appellant and the 2nd Defendant for the latter
to pay for finder’s fees, whilst the former paid for withholding taxes, proved that
the Respondent acted as a double agent. We do not agree with this submission.
60. In the first place, it is doubtful whether the existence (if at all) of any such
arrangement between the Appellant and the 2nd Defendant, is alone sufficient
to justify the conclusion that the Respondent acted as a double agent for the
two of them, especially in the absence of any other credible evidence to prove
the precise steps, taken by the Respondent in that direction.
61. More significantly, inherent in the argument of learned Counsel, if it is accepted,
is the proposition that both Appellant and the 2nd Defendant were aware of the
role played by the Respondent as a double agent and had therefore agreed to
split the payment of his remuneration between themselves. This would also
mean that the Respondent’s role as a double agent had been disclosed to both
Appellant and the 2nd Defendant.
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62. This would then bring the facts of this case clearly within the four corners of the
legal principle which permits an agent to work for both his Principal as well as
other third parties so long as full disclosure is made by that an agent.
63. In the case of Anglo-African Merchants Ltd and another v Bayley
[1969] 2 All ER 421 at page 429, Megaw J. cited with approval the clear and
precise statement of the above proposition by Scrutton LJ in Fullwood v
Hurley ([1928] 1 KB 498 at p 502 [1927] All ER Rep 610 at p 611 thus:-
“No agent who has accepted an employment from one principal
can in law accept an engagement inconsistent with his duty to the
first principal, from a second principal, unless he makes the fullest
disclosure to each principal of his interest, and obtains the consent
of each principal to the double employment.”
See also Halsbury 3rd Ed Vol 1 para 442 citing the case of Harolds v Lemon
[1931] 2 K.B. 157 CA.; again see para 446 and cases cited there – Baring v
Stanton [1876] 3 Ch. D. 502; Norreys v Hodgson [1897] 13 TL.R. 421;
Green v Tughan [1913} 30 T.L.R. 64
64. It follows therefore, from an examination of the above authorities that the
Appellant clearly proceeds from a faulty legal premise when he complains that
the Respondent was not entitled to any commission because he acted as a
double agent. That argument lacks force and we would reject it.
65. We will now turn to consider the Appellant’s next line of attack which alleges
that the Respondent did not completely broker the transaction for the purchase
of the land in question and must therefore not be entitled to any recovery at all.
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Allegation that having failed to conclude the transaction, the
Respondent was not entitled to recover commission
66. Both from the pleadings and the evidence adduced at the trial, it was undisputed
that notwithstanding the substantial efforts put in by the Respondent in finding
the land in question, he was not involved in the final negotiations which led to
the purchase of the land at a price of USD$2.5m. Rather, it was one Yaw Boakye
who successfully negotiated that price for the Appellant.
67. Indeed the learned trial Judge arrived at this same conclusion, and rightly so,
when he found as follows:-
“…..even though the Plaintiff did not complete the negotiation, he had
facilitated the negotiation by providing the exact details for the 1st
Defendant’s Yaw Boakye to negotiate for a reduction. In that case the
plaintiff would thus not be deemed as a broker as he never negotiated for
the final price.” (page 452 of the record).
68. The above emphatic conclusion drawn by the trial court notwithstanding, the
Court of Appeal took a contrary view of the facts and held that “… we find that
he (Respondent) brokered the transaction”
69. Significantly, the learned Justices of Appeal did not specifically indicate that they
were reversing the primary finding of fact made by the trial court on this
particular issue, nor did they assign any precise reasons for departing from the
conclusions drawn by the trial court. This we find to be rather striking.
70. We think that in this respect, the learned Justices of Appeal, with all due
deference, failed to address themselves properly to the relevant issue for
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consideration, and this Court, on the authority of such cases as Koglex Ltd
(No 2) v Field [2000] SCGLR 175 and Jass Co Ltd v Appau [2009]
SCGLR 265, should be entitled to interfere with the conclusions reached by
them.
71. The result is that the trial court’s primary finding that the Respondent failed to
conclude the negotiations for the final price of the land, which we think accords
more with the established evidence on the record, would be restored.
72. Now, what is the position of the law where an agent fails to conclude the
transaction for which he has been engaged?
73. In the case of Adisi v. Construction & Furniture Co. (W.A.) Ltd. of Accra
[1963] 2 GLR 42 the Supreme Court speaking with unanimity through Crabbe
JSC examined in a rather thorough manner a number of English authorities,
which had considered the circumstances under which a commissioned agent
was entitled to earn his commission.
74. In the end the Supreme Court preferred the House of Lords’ decision in the case
of Luxor (Eastbourne), Ltd. v. Cooper [1941] 1 All E.R 33, H.L., which
authority Crabbe JSC considered to be decisive in addressing questions relating
to recovery where an agent fails to conclude the transaction for which he had
been engaged.
75. In that case the agent was employed by the principal to sell a certain property,
the agreement being that the agent should receive a commission on the
completion of sale to any purchaser whom he could introduce. He introduced
a suitable purchaser, but the principal refused to sell. The agent therefore sued
the principal for breach of contract, his contention being that in law there was
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an implied term in the agreement that the principal would not without just cause
prevent the agent from earning his commission. The House of Lords, reversing
the decision of the Court of Appeal, held that when a contract provides that a
commission payable to house agents is to be payable "on the completion of
purchase" then it is not earned until the purchase is in fact completed, and there
is no implied term that the employer will not dispose of the property himself or
otherwise act so as to prevent the agent earning his commission.
76. At page 141 of the Report, the following salutary statement of the law was
attributed to Lord Wright:-
"In the case of the commission agent, to whom payment is
dependent on completion or the like condition, the principal does
not promise that he will complete the contract for reasons which
I have explained. His only promise is that he will pay commission
if the contract is completed. There is no promise to pay a
reasonable remuneration if the principal revokes the authority to
the agent. And it is a further objection to a claim on a quantum
meruit that the employer has not obtained any benefit. The agent
has earned nothing until the event materializes. It may seem hard
that an agent who has introduced a potential purchaser, able and
willing to complete, should get nothing for what he has done, if,
during the negotiations, the principal decides not to complete,
according to his own pleasure and without any reason which
quoad the agent is a sufficient excuse. But such is the express
contract . . . The agent in practice takes what is a business risk."
77. From the authorities above cited, there appears to be consistency of judicial
opinion on the point that until an agent concludes the transaction in question,
he stood to earn no commission at all. This is regardless of whether or not his
Page 21 of 30
failure to complete was due to his fault or not, unless there was an implied
prohibition against the Principal frustrating the agency agreement, which we
have not found to be so in this case.
78. Indeed, on the undisputed facts of this case it does appear that it was the
Respondent who took himself out of the transaction, after freely handing over
the contact details of the land owner to the Appellant to enable the Appellant
(through one Yaw Boakye) make direct contact with the land owner and
negotiate a final figure of USD$2.5m, for the purchase of the land in question.
79. To the extent then that learned Counsel for the Appellant sought to say that the
Respondent stood to recover no commission at all for failing to complete the full
terms of his engagement, we think he was only restating the correct position of
the law as held by the House of Lords in Luxor (Eastbourne), Ltd. v. Cooper
(supra)
80. Does the view we have held above then mean that the Respondent should be
entitled to no recovery at all, for services rendered under the agency agreement,
not even in quantum meruit? That is the conclusion urged on us by learned
Counsel for the Appellant. He contends that having failed to sue in quantum
meruit, the Respondent should not be entitled to any recovery, either on
commission or quantum meruit basis.
81. The question then raised for our determination, is whether this failure to sue in
quantum meruit is fatal to the Respondent’s claim for remuneration for work
done under the agency contract? Our answer to this question will dispose of the
second leg upon which the instant appeal has been anchored.
Page 22 of 30
WHETHER FAILURE TO SUE IN QUANTUM MERUIT FATAL
82. A quantum meruit action may be contractual or quasi-contractual. It is
contractual where an actual contract exists but no price has been fixed for the
Plaintiff’s services. Yet some services have been rendered under that contract
and the Defendant has taken the benefit of those services. It is quasi-
contractual where the Plaintiff, not relying on a contract, claims the value of a
benefit conferred by him on Defendant, who had an option to accept or reject
it. See the views of Collins L.J. in the case of Sumpter v Hedges [1898] 1
Q.B. 673.
83. The above principle was lucidly articulated by Abban J (as he then was) in the
case of Hammond v. Ainooson [1974] 1 GLR 176 at page 183 which we
fully endorse, as follows:-
“The principle is that where a person rendered services in
pursuance of a transaction, supposed by him to be a contract, but
which in truth, is without legal validity, he can recover for the
value of his services in quantum meruit”.
84. From the facts on record, it cannot be disputed that the Respondent was not a
gratuitous agent and that the Appellant expected the Respondent to be
remunerated for the services he rendered under the agency agreement between
the Parties. Secondly it is also not in doubt that the Appellant actually
acknowledged as per the contents of Exhibit “B”, some liability to pay for the
services rendered by the Respondent.
Page 23 of 30
85. It is against the backdrop of the above undisputed facts, that we are unable to
agree with learned Counsel for the Appellant when he argues that the
Respondent should not be entitled to any remuneration at all, on the mere
ground that he had failed to sue in quantum meruit?
86. To be clear, it seems to us too extravagant to dispose of such important issues
raised in this appeal, on grounds so mechanical and so fastidious.
87. As was famously said by Sowah JSC in the oft-cited case of Darke IX v Darke
IV [1984-86] 1 GLR 481, thus:-
“To decide a substantial and important litigation on technicalities
is in my view, the very negation of the justification of this court’s
existence. It has been said that the very first charge of a judge
should be the discovery of truth and justice not legalism,
formalism, and technical perfectionism, what Lord Denning has
described as costly nonsense. I would add monumental to that
noun.”
88. Beyond the above laudable pronouncements by Sowah JSC in the Darke IX v
Darke IV cited above, we also hold the firm view that, as a Court sitting in law
as in equity, our decisions must be guided by a dual focus on the failure of
justice and the prevention of unjust enrichment, as both factors are crucial in
determining a quantum meruit award.
89. An identity of reasoning informed the decision of Lord Clarke SCJ in the recent
English case of Benedetti v Sawiris [2013] 4 All E.R. 253 at 259, when he
stated thus:-
Page 24 of 30
“It is common ground that the correct approach to the amount to
be paid by way of quantum meruit where there is no valid and
subsisting contract between the Parties is to ask whether the
Defendant has been unjustly enriched and if so, to what extent”
90. Then at page 260, Lord Clarke proceeded to explain further as follows:-
“It is now well established that a Court must first ask itself four
questions when faced with a claim for unjust enrichment as
follows: (1) Has the defendant been enriched? (2) Was the
enrichment at the Claimant’s expense? (3) Was the enrichment
unjust? (4) Are there any defences available to the Defendant?
91. From the record in this instant case, there is very little doubt that the first three
questions must easily be answered in the affirmative. Not only did the
Respondent render services for the Appellant which conferred a benefit on the
Appellant and thus enriched it, but that the enrichment was at the Respondent’s
expense and was unjust or would be unjust if the Appellant fails to pay for the
services rendered.
92. Applying the correct position of the law then to the facts of this instant case,
we are convinced that even in the absence of an express claim in quantum
meruit, sufficient evidence existed on the record to support an award of
reasonable remuneration for the Respondent.
93. In line with the view we have held above, we have adverted our minds to the
fact that on the principle of doing substantial justice, the Court may in some
circumstances grant a Party, reliefs it did not ask for, provided the grant of that
or those reliefs are supported by credible evidence on record, and will help
Page 25 of 30
achieve substantial justice to the case and bring litigation to an end between
the Parties.
94. See for instance such landmark cases as Hanna Assi (No. 2) v GIHOC
Refrigeration & Household Products Ltd (No. 2) [2007-2008] SC GLR
16 and Muller Vs. Home Finance Ltd. [2012] SCGLR 1234, where in
ensuring substantial justice, the Supreme Court granted reliefs not specifically
claimed and endorsed. See also the case of Republic v. High Court Kumasi
Ex-parte Boateng [2007-2008] SCGLR 404.
95. Having thus satisfied ourselves that sufficient evidence exists on the record to
support an award of reasonable remuneration for the Respondent, the next
issue to address is how to assess the value of work done by the Respondent in
this case.
Basis for assessing value of work done by respondent.
96. It becomes a question of circumstances on what basis claims in quantum meruit
fall to be calculated. Such calculations are usually based on what might
reasonably be expected to be paid and into that computation many factors may
enter.
97. One of the factors that may be considered in this regard is evidence of the
bargaining negotiations between the Parties, which is relevant for purposes of
establishing the value put upon the agent’s services by the Parties. On this point
see Chitty On Contracts Vol. II Special Contracts at page 92
98. The above principle received some attention in the case of Way v Latilla
(supra) where Lord Atkin said at page 764:-
Page 26 of 30
“In such cases, if the amount of the commission has not been
finally agreed, the quantum meruit would be fixed after taking into
account what would be a reasonable commission, in the
circumstances, and fixing a sum accordingly. This has been an
everyday practice in the courts for years. But, if no trade usage
assists the court as to the amount of the commission, it appears
to me clear that the court may take into account the bargainings
between the parties, not with a view to completing the bargain for
them, but as evidence of the value which each of them puts upon
the services .”
99. In this suit, there is unchallenged evidence on record that the Respondent made
it clear to the Appellant at the bargaining stage, that his services would attract
a commission ranging between 5% to 10% of the purchase price of the land.
100. This critical fact, was admitted by the Appellant’s General Manager, Cecil
Sunkwa-Mills, under cross examination as follows:-
Q. So in all you will agree with me that the 1st and 2nd Defendants
recognized that the Plaintiff had done some work for which you had
to compensate him for. Am I correct?
A: Yes
Q: And it was after you had signed and executed the purchase and sale
agreement for the land that you decided to be unsure of what rate
to use to pay the Plaintiff, isn’t it?
A: No there had never been any agreed rate and there had never been
any clear terms to the Plaintiff for the job to be done
Q: I am putting it to you that the very beginning of your working
relationship with the Plaintiff he made it clear that his fees would be
5 to 10% of the purchase price
Page 27 of 30
A: Yes, he did mention the fee
101. Bearing in mind therefore that a rate of 5% - 10% commission was used as a
bargaining chip in the Parties’ negotiations, and having taken due cognizance
of the substantial albeit incomplete services rendered by the Respondent for the
benefit of the Appellant, we would by way of reasonable remuneration, award
the Respondent an amount equivalent to 2.5% of USD$2.5m., being the value
of the property; this works out to the cedi equivalent of USD$62,500.00.
CONCLUSION
102. We have carefully analysed all the evidence on the record in the light of
applicable well established legal principles, and we are unable to disagree with
the concurrent findings by the trial court and the Court of Appeal that the
Respondent is entitled to be remunerated for the services he had rendered for
the benefit of the Appellant. For the reasons afore-stated however, we would
substitute the award of 5% made in favour of the Respondent by the Court of
Appeal, with an award in quantum meruit assessed at 2.5% of the value of the
land in question.
103. Save for the above variation in the judgment of the Court of Appeal, we find no
merit in this appeal, which is accordingly dismissed.
(SGD) Y. DARKO ASARE
(JUSTICE OF THE SUPREME COURT)
Page 28 of 30
(SGD) P. BAFFOE-BONNIE
(JUSTICE OF THE SUPREME COURT)
(SGD) PROF. H.J.A.N. MENSA-BONSU (MRS.)
(JUSTICE OF THE SUPREME COURT)
(SGD) E. YONNY KULENDI
(JUSTICE OF THE SUPREME COURT)
(SGD) S. K. A. ASIEDU
(JUSTICE OF THE SUPREME COURT)
COUNSEL
ANTHONY FORSON JNR. ESQ. FOR THE 1ST DEFENDANT/APPELLANT/
APPELLANT WITH HIM, SUSANNA NYAMPONG, DENNIS ARMAH & ABIGAIL
AWUAH.
AKOSUA GYAMFI DUAMROH ESQ. FOR THE PLAINTIFF/RESPONDENT
/RESPONDENT WITH HER, DELALI KUSHITOR.
Page 29 of 30
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