LAND AGENTS’ CHARGES

Sun (Auckland), Volume II, Issue 445, 29 August 1928, Page 6

LAND AGENTS’ CHARGES

BASIS OF COMPUTATION “MONSTROUS,” fAYS LAWYER That the practice of land auctioneers of basing commission charges on the gross proceeds of the sale of a mortgaged property was monstrous was the contention of Mr. R. McVeagh during the hearing of a dispute in the Supreme Court yesterday. Counsel held that the rightful charge should be on the equity only. Several land agents replied t!%it such a basis would at once put them through the Bankruptcy Court. A witness, Hubert Earle Vaile, managing director of Samuel Vaile and Sons, said that proof that charges were by no means too high was that so few people in his line of business ever made money.

Alfred Ernest Bagnall (Mr. McVeagh) asked that accounts be taken of the proceeds of the realisation of a mortgage to Hubert Thomas Clemente (Mr. Richmond), and that inquiries be made by the court as to what amounts were properly chargeable by the defendant against such proceeds. Plaintiff also sought judgment for the balance of the proceeds due to him as a result of the taking of the accounts. Defendant denied that moneys* were owing to plaintiff. Mr. McVeagh said the question at issue was actually whether a commission of £7OO charged by Mandeno Jackson, Ltd., auctioneers, at the instance of the defendant as second was reasonable. He contended it was monstrous. Plaintiff had owned two sections in Anzac Avenue and ‘‘-Bagnall’s Building” had been erected thereon. The land was subject to a first mortgage of £20,000. Bagnall later raised a second mortgage of £5,600. Plaintiff got into default under this second mortgage and the second mortgagee sold the property through Messrs. Jackson. The price realised totalled £28,000. The firm charged £7OO, being commission at the rate of 2£ per cent. Mr. Richmond contended that plaintiff should be non-suited as defendant did not in fact employ the auctioneers, but they were employed by the registrar of the Supreme Court in the ordinary course of law. There was no means of recovering the commission paid, for that reason. After hearing Mr. Richmond, his Honour adjourned the case until tomorrow morning, when Mr. McVeagh’s argument will be heard.