Agency Agreement in UK Law

In his submissions, Mr Thomas QC placed great emphasis on this point, saying that, in the real world, any valuation would take account of the fact that the agency was terminable after twelve months. However, I agree with Mr Segal QC that this is a heterodox approach.

The true position, as it seems to me, in a case in which an agency agreement has been wrongfully terminated without notice, is that the valuation of the amount of the goodwill payable as compensation under Regulation 17(6) includes, so far as appropriate (and it may well be that it is not appropriate to adjust the calculation in any way), the period which would otherwise have been covered by a notice.

For instance, if the negotiations between the vendor and the purchaser have been duly concluded and a binding executory agreement has been achieved, different considerations may arise. If he refuses to complete he would be guilty of a breach of agreement vis-à-vis the purchaser. I think as at present advised that it ought then to be held that he is also in breach of his contract with the commission agent, that is, of some term which can properly be implied.

The whole purpose and intent of the agency agreement was that the parties should enter into contracts for the purchase and sale of the plaintiffs' goods. In those circumstances the claim and the counterclaim are sufficiently closely connected to make it unjust to allow the plaintiffs to claim the price of goods sold and delivered without taking account of the defendants' counterclaim for damages for breach of the agency agreement.

So far as any general principle is deducible from the authorities, their effect may, I think, be thus summarised: The question depends on the construction of each particular contract, but prima facie the intention of the parties to a transaction of this type is likely to be that the commission stipulated for should only be payable in the event of an actual sale resulting.

The condition precedent in the first limb of clause 4.1 and the payment obligation imposed by clause 3.1(c) are not inter-dependent. Although there may be practical considerations – and some obvious convenience – in having the same time limit in both clauses 4.1 and 3.1(c) , the fact that the time limit is the same in the two clauses is of no legal relevance.

If any such application is made in the latter respect, it may be Genworth will give consideration to whether to seek to join FICL/FACL and/or Santander as additional defendants for that limited purpose, although the same effect might be achieved by other means, for example a simple agreement by FICL/FACL and Santander to be bound by the result.