Offer and acceptance – consideration – estate agent sending unsolicited letter – liability for fee on sale

L, an estate agent, sent an unsolicited letter, informing F of a property offered for sale by another estate agent who had been retained by the vendor. The letter stated that a fee would be payable to L if the information led to a purchase by F. F believed that L was the vendor’s agent and asked its own agent to make arrangements to view the property, following which F made an offer and subsequently purchased the property. L claimed the fee set out in the letter, contending that the letter constituted an offer to provide further information in return for a fee payable on completion. L’s claim was refused at first instance and L appealed. Held, dismissing the appeal, that the information given in the letter did not entitle L to claim a fee as there was no agreement in existence between L and F at the time the letter was sent. To find otherwise would allow L to impose a contract on F, contrary to the principle of willing assent by contracting parties, Falcke v. Scottish Imperial Insurance Co (1887) L.R. 34 Ch. D. 234 followed. Although a contract could have been made after L had provided F with the initial information, that information only amounted to past consideration which could not support the contract contended for by L. Further information given by L at F’s request would have been valid consideration, but this had not been sought by F. On the facts, therefore, L’s letter did not constitute an offer to provide further information in return for a fee, so that no contract had been made and no fee was payable to L by F. LADY MANOR LTD v. FAT CAT CAFÉ BARS (NO. 2) [2001] 33 E.G.88, Judge Cowell, CC (West London).

Current Law January 2002