FC FEDERAL COURT (JOHORE BAHRU)
RAJA AZLAN SHAH, CJ (MALAYA), ABDUL HAMID, FJ & YUSOFF MOHAMED, J
CHEW TENG CHEONG
versus
PANG CHOON KONG
CIVIL APPEAL NO 13 OF 1980
Decided On : 10-12-80
(delivering the judgment of the Court): The subject matter of this appeal is an area of some 18,000 acres of timber-land in Pahang. The profits to be made were enormous - they were said to be $18,000,000. So when it was noised about that one Au Ah Wah had the rights to this area, his acquaintance was eagerly sought. Those who did not know him personally sought therefore introductions from those who knew and were prepared to pay considerable sums for the introduction.
The appellants and one Lin Wyen Pang who was one of the plaintiffs in the action but chose not to appeal from the dismissal of their claims introduced the respondent to Au Ah Wah. Arising from that introduction, an agreement was drawn up between the respondent and Au Ah Wah on March 20, 1973 (the March 20 agreement) for the transfer of all his rights in the timber-land to the respondent. We shall refer more fully to the terms of this agreement later. The obligation of the respondent to the introducers was incorporated in another agreement between them on March 31, 1973 (the March 31 agreement). On this agreement, the appellants and Lin Wyen Pang sued for the $900,000 promised to them therein. The High Court dismissed their claim and they now appeal to this court.
The law to be applied is therefore the law of estate agents. Where the agency contract provides that the agent earns his remuneration upon bringing about a certain transaction, he will be entitled to such remuneration if he is the effective, not necessarily the immediate cause of the transaction being brought about. Whether there is a sufficient connection between his act and the ultimate transaction must be ascertained from the facts of the case. "The effectiveness of the agent's work is a matter of inference from the evidence" per McGregor J. in Sushames v Cumming [1962] NZLR 920, 925. Where the agent can show that some act of his was the causa causans of the transaction Tribe v Taylor (1876) 1 CPD 505, 510 or was an efficient cause of the sale Millar v Radfordia [1903] 19 TLR 575, he is entified to his agreed remuneration. Both of these cases were approved in the Privy Council in Burchell v Gowrie and Blockhouse Collieries Limited [1910] AC 614, which itself is a case where the broker was held entitled to recover because he had brought the company into relation with the actual purchaser, although the company had sold be hind his back. See also Symons v Callil [1923] VLR 49 (Full Court of Victoria). So where the property was eventually bought not by the lady introduced by the agent but by her husband as part of a property settlement then being negotiated and on the intimation by the wife that she desired that property, it was held that the husband's action in obtaining the property for his wife had the same effect as a direct approach by the lady to the owners would have had: Hansen Real Estate v Jones & Jones [1980] NZLR 284. We need to refer to only two more cases. In Green v Bartlett (1863) 14 CB (NS) 681, a potential buyer had asked the auctioneer, after the auction sale had not reached the reserved price, for the name of the owner and with the knowledge had purchased the property directly from him. The auctioneer was held entitled to his commission. In Tong Lee Hue v Yong Kak Chin [1979] 1 MLJ 233 this court considered the case as one of strict construction of the contract between the parties.
It is clear that the claim of the appellants depends on the proper construction to be given to this March 31 agreement. It recited that they were responsible for the March 20 agreement and then said that they were relinquishing their rights to the timberland upon certain terms. By all accounts it was a rather curiously drawn up document. But the consideration was stated in the following terms:
"1. In consideration of the Second, Third and Fourth Parties relinquishing the rights to the 18,000 acres of forest land the subject matter of the said contract between the First Party and A
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