Wakefields Real Estate (Pty) Ltd v Gavin Wayne Attree and Others

The Attrees owned a house at 37 Monteith Place, Durban North, which they wished to sell while building a new house at Mount Edgcombe. Multiple estate agents were involved in marketing the property. Wakefields Real Estate, through agent Phoulla Walker, introduced prospective purchaser Mrs Howard to the property in March 2005. Howard loved the house but told Walker she could not afford it and stopped looking for a new house. Fortuitously, Howard met De Marigny (from Pam Golding Properties) who phoned her when the Attrees reduced the price in April 2005. De Marigny facilitated the sale and the Attrees paid commission to Pam Golding Properties, which shared it with Remax (who had a sole mandate at the time). The sale price was R3,400,000. Wakefields claimed commission of R232,560 (6% of purchase price) arguing they were the effective cause of the sale through Walker's initial introduction.

• Whether Wakefields had a mandate from the Attrees to sell the property
• Whether Wakefields, through Walker's introduction of Howard to the property, was the effective cause of the sale and thus entitled to commission
• What factors determine which estate agent is the effective cause when multiple agents are involved in a property sale
• Whether intervening factors (price reduction, De Marigny's efforts, financial circumstances) displaced Walker's initial introduction as the effective cause

The appeal was upheld with costs and the cross-appeal was dismissed with costs. Paragraphs (a) and (b) of the high court order were set aside and replaced with: 'The defendants are ordered to pay the plaintiff the sum of R232,560 plus interest at the rate of 15.5 per cent per annum from 11 October 2005 to date of payment, and costs of suit.' Paragraphs (c) and (d) regarding Howard's costs remained undisturbed.

An estate agent who introduces a prospective purchaser to a property is the effective cause of a subsequent sale to that purchaser, even where another agent later facilitates the actual transaction, provided that the initial introduction was the but-for cause that brought the willing purchaser and the property together. The test is one of causation applying common sense standards, not degrees of effort expended. Where an agent introduces a purchaser to a property and the purchaser expresses strong interest but is prevented from purchasing by factors such as price or financial constraints that later fall away, and the purchaser subsequently purchases through another agent, the initial introducing agent remains the effective cause. Estate agents are remunerated by results, not by intentions or hard work. A seller who engages multiple agents without protection bears the risk of liability to more than one agent for commission.

Van den Heever JA's observation in Webranchek was endorsed: situations are conceivable where it is impossible to distinguish between agents' efforts in terms of causality, and in such situations a principal may owe commission to both agents and 'has only himself to blame for his predicament; for he should protect himself against that risk.' The court also noted that the evidence of De Marigny was 'far from satisfactory' and that the Howards, who had allegedly indemnified the Attrees against commission claims by other agents, were not disinterested witnesses, though nothing turned on credibility since undisputed facts were sufficient to determine the matter. The court observed that De Marigny 'reaped where she had not sown.'

This case clarifies the test for determining which estate agent is the 'effective cause' of a sale when multiple agents are involved. It confirms that the initial introduction of a willing purchaser to a property can be the effective cause even where another agent later facilitates the actual transaction. The case reaffirms that estate agents are paid by results, not effort, and that subsequent involvement by other agents does not necessarily displace an earlier introduction as the effective cause. It serves as a warning to property sellers who engage multiple agents that they may find themselves liable to pay commission to more than one agent. The decision reinforces the principles in Aida Real Estate Ltd v Lipschitz and demonstrates the court's application of common sense standards rather than metaphysical notions of causation in determining effective cause, as stated in Webranchek v L K Jacobs & Co Ltd.