Was there a concluded contract for the appointment of a real estate agent even though the letter of appointment was unsigned?

ZERIN PROPERTIES V NAZA TTDI SDN BHD [2020] 1 MLRA 362

• Zerin Properties was a licensed real estate agency (“Agent”).

• Naza TTDI Sdn Bhd was a property development company (“Developer”).

• The Agent claimed that it had been approached by the Developer to market the sale of various plots of development land.

• The Agent claimed that its endeavours and work led to the conclusion of a joint venture between the Developer and Hap Seng Land Sdn Bhd (“Hap Seng”) in respect of one (1) plot of development land (“Development Land 1”).

• A letter of acceptance was sent by the Agent in respect of Development Land 1 which was unsigned by the Developer (“LOA 1”). A subsequent letter of acceptance was signed but concerned a different piece of land (“LOA 2”).

• The Developer later denied approaching the Agent and denied that any amount was due and owing to the Agent.

• The Agent sued the Developer in the High Court to recover its professional fees for work done and services rendered.

• The High Court judge dismissed the Agent’s claim on the grounds that (i) the Agent was not validly appointed by the Developer to sell Development Land 1; (ii) the Agent was not the effective cause of the sale or that the joint venture did not amount to a sale; (iii) LOA 1 was unenforceable because it was unsigned; and (iv) LOA 2 was in respect of a different piece of land.

• The Agent appealed to the Court of Appeal.

The Court of Appeal held that there was a valid contract in respect of LOA 1 even though it was unsigned. The LOA 1 must be construed in its entirety. Based on the dealings between the Agent and the Developer taken in its proper context and in totality there was a concluded contract as to the Agent’s appointment as the Developer’s agent, although LOA 1 was not signed. There was a concluded contract as the parties had conducted themselves as if there was a contract afoot, i.e. a contract by estoppel.