20181020 Refusing to pay commission

20181020 (Sat)

Can my tenant withhold payment of commission to me when I have helped him find a house?

Take for example, you were told to source for a house for this expatriate tenant from overseas. He emailed to you the specifics of the property and provided a sum of money in your client’s account for such booking fee payment.

You saw a perfect property for him and due to urgency to secure the property, you quickly make cash payment to the landlord from your own account. The landlord accepted it and you are so happy that you got it settled. However, your principal (expatriate tenant) refuses the property when you informed him of the good news. Furthermore, he refuses to pay any fee outstanding to you. The Client’s Account money is not sufficient to compensate your booking fee paid (now forfeited).

S.157 Revocation where authority has been partly exercised.

The principal cannot revoke the authority given to his agent after the authority has been partly exercised, so far as regards such acts and obligations as arise from acts already done in the agency.

Based on S.157, Contracts Act 1950, this expatriate tenant (your principal) cannot revoke the authority given to you when you used your own money to pay the booking fee. He can however, refuse to take the property if you have used the Client’s Account money (his money – which was no enough). He of course, can say I compensate the forfeited booking fee, but still refuse the accept the property. If he does NOT do so, he is in breach of agency contract to carry out the authority vested onto you. He cannot revoke the authority which it has been partly carried out.

In order to keep good faith, normally such condition will mean the booking fee being forfeited, and another new property to be sourced for the satisfaction of the principal.

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