Taylor v Smith
[1926] HCA 16(Decision by: Starke J)
Taylor
vSmith
Judges:
Knox CJ
Isaacs J
Higgins J
Rich J
Starke J
Subject References:
Principal and Agent
Authority to sell land for net sum
Right to retain excess over that sum
Authority in writing to sell for certain sum and to retain excess
Signature obtained by misrepresentation
Principal not able to read without glasses
Non est factum
Action for money had and received
Money paid away by solicitor under mistake of fact
Recovery from payee
Ratification
Judgment date: 10 June 1926
Melbourne
Decision by:
Starke J
The appellant Taylor was employed by the respondent Smith as his agent to sell certain property for him. Taylor met with an accident, and procured one Colbert to assist him in negotiating the sale of the property. Colbert saw the respondent and induced him to sign a document on the appellant's note-paper as follows:-"I hereby give to you the sole offer of my property situated at 43 Chapel Street, St. Kilda, consisting of 5 self-contained flats with frontage of 50 ft. by 195 ft. 4 in. for the sum of £4,000. Any moneys secured by you from the purchaser in excess of this amount I agree to allow to you as bonus or commission."
The learned County Court Judge who tried the action found, in substance, that the respondent was tricked into signing this document by a representation of Colbert's that it was an authority to sell the respondent's property, and that the respondent was unable to read the document because he had not with him his spectacles or glasses. I agree with the learned Judges of the Supreme Court that this finding cannot be disturbed. Colbert did not deny the respondent's evidence; in fact he was not even called as a witness, and the commission claimed pursuant to the arrangement which the document purports to record was nearly £400 in excess of the usual agent's commission on a sale such as was effected for the respondent. It would be impossible in such circumstances for Colbert to vouch the document as an authority for the payment to him of £500, and Taylor stands in no better position. In my opinion the case of Refuge Assurance Co. v. Kettlewell(1) completely covers the facts of this case.
It was argued in this Court, however, that the respondent had ratified the payment by Serle, his solicitor, of the sum of £500 to the appellant. No such contention appears to have been made before the learned County Court Judge. It is true that he considered whether the respondent's conduct amounted to a waiver disentitling him to recover the amount in dispute; but that rather suggests that the appellant was treating the authority, for the purpose of argument, as induced by fraud or misrepresentation, and contending that the respondent had not elected to repudiate it. It is clear that the argument now relied upon was never presented in the Supreme Court. I do not think that we ought to entertain it now; but in deference to the argument addressed to us I will add that it ought not, in my opinion, to succeed.
The onus of proof is here upon the appellant. The argument involves, of course, the adoption of a payment made by Serle on behalf of the respondent but without his authority. Serle, it must be observed, acted generally for the appellant as his solicitor, but, at the instance of the appellant, acted for the respondent in connection with the sale of this property and the purchase of another. Serle, so far as the evidence goes, had no instructions from the respondent as to the commission payable to Taylor and Colbert, and such information as he had must have proceeded from one or other of the latter, for it is inconceivable that he would make a payment to either without some information upon the subject. I think it probable that he acted upon the information of his client Taylor, and that he did so without any reference to or confirmation by his client the respondent.
The amount of the commission in itself called for some inquiry by Serle, but he was in a somewhat embarrassing position owing to the fact that he was Taylor's solicitor. At all events, he made no inquiry from the respondent, and paid over £500 to Taylor and Colbert on account of the respondent. He forwarded an account to the respondent showing a payment of £500 to Taylor and Colbert, but without any explanation of the basis upon which this amount was paid or any intimation that it was largely in excess of the commission ordinarily payable to agents on a sale such as is before us.
We are asked to conclude that the respondent adopted the payment "with full knowledge of the character of the act," or "with intention to adopt" it in any event (Phosphate of Lime Co. v. Green(1)); and to so conclude, in face of the facts that the respondent was a dull business man, that he was under no obligation, either legal or moral, to pay an unfair charge, that his rights were never explained to him, and that his circumstances were such that he needed all the money he could raise. My view is that he relied upon Serle to protect him, and really knew nothing of the material circumstances relating to the payment. The evidence wholly fails to satisfy me that the respondent ever ratified the unauthorized payment of £500 to Taylor and Colbert, and, in fact, I do not think he ever did ratify it.
Lastly it was argued that the sum claimed by the respondent was not recoverable from Taylor upon a count for money had and received. If Serle, however, were induced, as upon the evidence I conclude he was, to pay over the sum of £500 to Taylor on his assurance that the respondent had arranged to pay him and Colbert that amount for commission, then, admittedly, no difficulty arises. Serle might recover the money on the footing that he paid it under a mistake of fact, and so, I apprehend, may the person on whose behalf he paid it (Holt v. Ely (2); Colonial Bank v. Exchange Bank of Yarmouth, Nova Scotia(3)).
The appeal ought, in my opinion, to be dismissed.