Armstrong Martin Realty Ltd v Acton Grange Properties Ltd et Al
| Jurisdiction | Barbados |
| Judge | Belgrave, J. |
| Judgment Date | 24 June 1992 |
| Neutral Citation | BB 1992 HC 29 |
| Docket Number | No. 501 of 1990 |
| Court | High Court (Barbados) |
| Date | 24 June 1992 |
High Court (Civil Jurisdiction)
Belgrave, J.
No. 501 of 1990
Mr. Ernest Jackman for the plaintiff.
Mr. Peter Williams, Q.C., for the defendants.
Contract - Breach — Agreement by chairman of first defendant company to pay plaintiff a finder's fee to locate a suitable property — Vendor and purchaser made supplemental agreement to postpone completion of sale by six years after plaintiff found property — Whether plaintiff still entitled to fee.
The first defendant, Acton Grange Properties Limited, (Acton Grange) is a company, registered in England and its registered office is in that country. It is a company, which as its name suggests, invests in real estate. In 1988, Acton Grange became interested in acquiring a property in Barbados. Its Chairman and Managing Director, Mr. Keith J. Wheeler, engaged the plaintiff company, Armstrong Martin Realty Limited (Armstrong Martin) to find for his company a suitable property in Barbados which was for sale. Armstrong Martin located a property in Saint James, Barbados and introduced Mr. Wheeler to the owners of that property. It was agreed between Mr. Wheeler and Mr. Richard Armstrong, a director of Armstrong Martin that Acton Grange would pay Armstrong Martin, for its services, a finder's fee of $175,000.00 as commission. The agreement to this effect is contained in a letter dated March 13, 1988 from Mr. Richard Armstrong to Acton Grange. It was signed on the same date by Mr. Keith J. Wheeler on behalf of Acton Grange. It reads thus:–
“Dear Sirs,
This is to confirm our previous discussions and agreement regarding the payment to our company of a Finders' Fee by Acton Grange Properties Limited, or its nominee, for arranging the purchase of Golden Anchorage Limited, Caribbean Resorts Limited, and Sunset Resorts Limited, at Sunset Crest, Barbados, by the said Acton Grange Properties Limited or its nominee. In this regard, it is hereby agreed that our fee will be Barbados $175,000.00 (one hundred and seventy-five thousand Barbados dollars) payable in full on the closing of the sale and purchase by yourselves.
Please indicate your agreement with the foregoing terms by countersigning in the space provided below. Thanks again for choosing the services of Armstrong Martin Realty Limited.”
The fee of $175,000.00 has not yet been paid by Acton Grange despite several demands by the plaintiff for settlement.
As a consequence a writ was filed in the High Court by the plaintiff company on May 11, 1990 in which the plaintiff is claiming damages for breach of contract by Acton Grange for its refusal to pay the fee of $175,000.00.
The relevant parts of the Statement of Claim are as follows:–
“4. By agreement partly oral and partly in writing made on or before March 13, 1988 with the plaintiff, the defendant agreed either by itself or its nominee to pay to the plaintiff, a finder's fee of $175,000.00 to locate and introduce to it, to purchase, a desirable property in this Island. It was a further term of the said agreement that the said finder's fee would be paid on completion of the sale and purchase of any property located in accordance with the terms of the said agreement set out herewith.
The plaintiff pursuant to the said agreement found for and introduced to the first defendant or its nominee the properties known as Golden Anchorage Limited, Caribbean Resorts Limited and Sunset Crest Resorts Limited all situate in the parish of Saint James in this Island.
The plaintiff further commissioned and paid for feasibility study and financial proposal for the purchase of the said property and advised the first defendant and/or its nominee on the bid to place on the said property.
5. The sale and purchase of the said property was completed on/or about the month of March, 1989.
6. …
7. The first defendant and/or its nominee has refused and continues to refuse when called upon by the plaintiff to pay to the plaintiff or its attorneys-at-law, the said finder's fee of $175.000.00.
8. And the plaintiff claims
(i) …
(a) …
(b …
(ii) Damages
(iii) Interests
(iv) Costs.”
The defence to the plaintiff's claim is that the plaintiff is not entitled to be paid the agreed finder's fee of $175,000.00 prior to the closing of the sale and purchase as agreed and that the sale and purchase has not yet been closed because the shares have not been transferred and registered in the name of the purchaser. The matter is set out in the defence as follows:–
“4. The defendant Acton Grange Properties Limited, will refer to the plaintiff's letter dated March, 13 1988 to it whereby it was agreed that the plaintiff's fee of Barbados $175,000.00 payable in full on the closing of the sale and purchase of the assets owned by Caribbean Resorts Limited, Sunset Crest Resorts Limited and Golden Anchorage Limited.
5. …
6. …
7. The said defendant denies paragraph 7 of the Statement of Claim and says that the plaintiff is not entitled to its finder's fee prior to the closing of the sale and purchase as agreed.
8. The defendants deny that the plaintiff is entitled to the claims made in paragraph 8 of the Statement of Claim.”
Philip Nigel Martin and Richard Armstrong who were the two directors of the plaintiff company in 1988 gave evidence in support of the claim.
Their evidence is that the plaintiff company is entitled to be paid the agreed finder's fee of $175,000.00 because the deal has been satisfactorily completed in as much as Acton Grange has been in occupation and possession of the property since September, 1988. The vendors of the property have been paid a substantial portion of the purchase price and will be paid the remainder in accordance with an agreement made between the vendors and Acton Grange (Barbados) Limited the second defendant, a company owned by the first defendant. All the shares in the companies which owned the property purchased have been transferred to Acton Grange or its nominees.
Acton Grange has subdivided part of the property since taking possession and has sold some of the condominiums as well as the vacant parcel of land which adjoined the Golden Anchorage Hotel.
Mr. Basil Ashcroft Giles, attorney-at-law for Acton Grange, was the only witness called on behalf of the defendants. His evidence is that the sale and purchase of the property has not yet been completed in as much as the shares in the companies which owned the properties which Acton Grange has agreed to purchase have not yet been registered. Mr. Giles said that shares to be transferred have been valued by the Commissioner of Valuations at a price which is higher than the selling price of the property sold to Acton Grange. This valuation, if accepted, would result in the purchaser and the vendors having to pay sums of money as property transfer tax which are higher than the sums contemplated by them. As a result of this unexpected development, the vendors and the purchaser on July 7, 1989 entered into a supplementary agreement in which they had agreed that the date for the completion of the sale and purchase be extended to December 31, 1994. It further provided that the date set out for the payment of the remainder of the purchase price as provided for be the new date stated in the supplementary agreement. A bundle of documents has been admitted by agreement and only those relevant to the one issue in the case will be referred to here.
The one issue in the case is not whether the plaintiff is entitled to be paid the finder's fee of $175,000.00 for the services rendered to Acton Grange as real estate agents at the request of Acton Grange; the question is what is the date on which the said payment is due. The plaintiff says that the payment became due on the closing of the sale of the property to Acton Grange.
Acton Grange's case is that due to the extension of the date of completion of the sale and purchase to December 31, 1994 pursuant to the supplemental agreement signed by the vendors and Acton Grange on July 7, 1989, the plaintiff is not entitled to be paid the finder's fee until December 31, 1994.
Mr. Philip Martin, the director of the plaintiff company who was handling the matter on behalf of his company said in evidence that he had negotiated the finder's fee of $175,000.00 with Mr. Keith J. Wheeler and that he had suggested to Mr. Wheeler that the said sum be paid in two instalments, namely, $100.000.00 should be paid by Acton Grange to the plaintiff on the signing of the contract by Acton Grange and the vendors. The remaining $75,000.00 to be paid three months after the said contract was signed.
Mr. Martin said that he had discussed this matter with Mr. Wheeler and had prepared a letter to that effect for Mr. Wheeler to...
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