Can my landlord find his own tenant and reject mine despite appointing me as an agent? Part 1.
There are two aspects of agency contract here. First is type of appointment, and second is with regards to termination of appointment.
The appointment was not written. It was presumed that you are appointed to source for tenant. You have done the advertising, and three days later you found a good tenant for him. Your tenant saw the house and paid the booking fee straight away.
Happy and excited, you announced the news to the landlord. Disappointingly, he said he had already rented it out yesterday, and regrettably he canNOT accept your tenant’s offer. Is he in the wrong?
In situation like this, the appointment can be exclusive and yet he does NOT have to accept the offer by your tenant. If it is an ad hoc appointment, he does NOT even need to inform and it is 100% fine he does NOT pay you any commission! In fact, when he himself got a tenant, he has implied termination of the agency. This is because:
S.160 Revocation and renunciation may be expressed or implied.
Revocation and renunciation may be expressed or may be implied in the conduct of the principal or agent, respectively.
A empowers B to let A’s house. Afterwards A lets it himself. This is an implied revocation of B’s authority.
The moment that he got his tenant, it is implied that the agency contract between him and the agent is terminated.
So, there is nothing wrong that he rejects the offer of your tenant, and thus there is no deal. The implied term of appointment is that he can close deal himself without having to inform you. In other words, it is implied that your appointment is terminated upon his successful sourcing of tenant himself.
How then is this fair to you? Well, it is not about being fair or not… It is about who is the principal and who is an agent. The principal is the originator of the whole deal. Without principal, there is no agency in the first place. Even if you were appointed as his agent, there is no guarantee that agent can close the deal. The risk and liability of the property is the responsibility of its owner – not the agent. Thus, the owner has the full ownership and responsibility to cover that risk. Part of that risk is the delay in getting a tenant. If he could get tenant himself to cover that risk earlier, it is only fair that it is done earlier than later.