Date: 19971027 Docket: 24392 Registry: Kamloops IN THE SUPREME COURT OF BRITISH COLUMBIA BETWEEN: JOHN ROY TURNER and PRINCIPLE REALTY LTD. PLAINTIFF AND: JOHN McCLURE and MARIAN McCLURE DEFENDANT REASONS FOR JUDGMENT OF THE HONOURABLE MR. JUSTICE LAMPERSON Counsel for the Plaintiff: Frank R. Scordo Counsel for the Defendant: Robert McDiarmid, Q.C. Place and Date of Hearing: Kamloops, B.C. October 9 and 14, 1997 [1] The plaintiffs seek payment of a real estate commission in the sum of $27,000 plus applicable taxes allegedly owing to them from the sale of the Chase Country Inn, which is a motel that belonged to the defendants. The questions arising from this litigation are: 1. Even though the listing contract had expired at the time of the sale, were the plaintiffs entitled to a commission because they were an effective cause of the sale? 2. If not, were the plaintiffs entitled to compensation on a quantum meruit basis? [2] Principle Realty is the alter ego of Mr. Turner and consequently I will refer to them as either the plaintiff or Mr. Turner. [3] The defendants listed the Chase Country Inn for sale with the plaintiff at a price of $700,000. According to the listing contract the defendants were to pay the plaintiff a commission of 4% upon the sale of the property. That listing expired on June 30, 1996. [4] During the morning of Tuesday, July 2nd, the eventual purchasers, Mr. and Mrs. Kent, stopped at the Chase Country Inn to ask directions to another motel which was listed for sale in the Village of Chase. After looking at that motel they returned to the defendants' motel and asked a chamber maid whether the Chase Country Inn was for sale. She did not know, but in the absence of the defendants, took it upon herself to show the Kents various units and to give them the defendants' business card. The Kents then drove to Radium Hot Springs to look at another motel which they were interested in purchasing. That evening Mr. Kent telephoned the defendant, John McClure, from Radium Hot Springs and inquired whether the Chase Country Inn was for sale. Mr. McClure answered in the affirmative and said that he wanted $700,000 for the property. Mr. Kent then asked for the financial statements for the motel. Because Mr. McClure did not have those statements readily available, he suggested to Mr. Kent that he obtain this information from the plaintiff, who would still have it in his possession. On July 3rd the Kents tried repeatedly to get in touch with Mr. Turner and finally succeeded in doing so in the late afternoon. [5] They told Mr. Turner that they wanted to see the financial statements since they intended to view the property again on the next day. Mr. Turner said that he intended to go to his cottage on Shuswap Lake that day and that since it was on his way he would meet them at the motel around 1:00 p.m. He then telephoned John McClure and told him the same thing. Everyone, save Mrs. McClure, met at the motel on the following day, being Thursday, July 4th. Mr. McClure, accompanied by Mr. Turner, showed the Kents around the motel. Because Mr. Turner had not brought the financial records with him as expected, he was again asked to fax those documents to the Kents. The Kents were left with the impression that this would be done the same afternoon. Nothing further happened until the late evening of Saturday, July 6th when the Kents sent the plaintiffs the following facsimile: July 6, 1996 Attention: J. R. Turner c/o Royal LePage Please be advised due to your slow response to our inquiries on "Chase Country Inn" we do not want your services as the agent on our behalf. Yours truly Linda Kent (Linda Kent) Reg Kent (Reg Kent) [6] That same day Mrs. Kent called Mr. McClure. She told him that she had not received any financial information from Mr. Turner but did not tell Mr. McClure that she had sent a message to Mr. Turner telling him that she no longer wanted to deal with him. Mr. McClure, after several attempts to page Mr. Turner, spoke to him that evening. [7] On July 7th Mr. Turner telephoned Mrs. Kent to see what the problem was. She confirmed that she wanted no more dealings with him. After that Mr. Turner did in fact fax the financial information to the Kents. The information written in by Mr. Turner with respect to the revenue received by the Chase Country Inn during the winter of 1994 and 1995 was incorrect in that it was not as large as he suggested. There is no suggestion that this was done deliberately. He also indicated quite correctly that the actual income of the motel was greater than the financial statements indicated. This was Mr. Turner's last involvement with the transaction. [8] Towards the middle of July the Kents made an offer directly to the McClures to purchase the motel for $650,000. That offer was refused. At this time Mr. McClure telephoned Turner and told him that he had turned down a $650,000 offer from the Kents, that he was very busy and that he did not want any potential purchasers brought to his motel. [9] The Kents visited the motel once more and on July 23rd made an offer of $675,000, which the McClures accepted on August 1st. [10] Mr. Turner alleges that over the years there was an ongoing business relationship between himself and the defendants and that he was involved in all their land transactions. He also says that he played a significant role in advising the defendants that they subdivide off from the motel property certain lands which were being used as a recreational vehicle park. It should be noted that the defendants in each of these instances were the purchasers of property and consequently paid no commission to Mr. Turner. With respect to obtaining different titles to the motel and the recreational park, I accept Mr. McClure's testimony that although he spoke to Mr. Turner, it was he who contacted the surveyors and took care of the actual subdivision, and that Mr. Turner was not involved. I also accept the defence evidence that Mr. Turner indicated to both Mr. Kent and Mr. McClure that he would attend the meeting on July 4th only because he was going to Shuswap Lake in any event. I am satisfied that neither Mr. McClure nor the Kents sought Mr. Turner's attendance, even though they did not object to him being there. It is also clear the Kents came across the Chase Country Inn by happenstance and that Mr. Turner did not introduce them to the property or to the defendants. [11] The burden is upon the plaintiff to demonstrate on the balance of probabilities that he was "an effective cause of the sale" of the motel. He has not discharged this burden. He did not introduce the buyers to the sellers or bring the property to the buyers' attention. As a matter of fact, it is clear that the Kents did not require Mr. Turner's involvement and that after July 6th they wanted nothing more to do with him. I am satisfied that Mr. Turner did not materially contribute to the eventual sale of the motel. Because the listing had expired and Mr. Turner was not the causa causans of the sale, it follows that he is not entitled to a commission. He did nothing after sending the financial information to the Kents on July 8th. [12] Nor do I think that the plaintiff is entitled to compensation on the basis of quantum meruit. Where quantum meruit arises outside of a contract, the following principles of unjust enrichment apply: (a) an enrichment; (b) a corresponding deprivation; (c) the absence of any juristic reason for such enrichment. [13] Thus the efforts and services of a real estate agent may entitle that agent to compensation even though there is no existing listing contract. The plaintiff must, however, establish that the defendants received a benefit as a result of the plaintiff's actions. With regard to the benefit received in the context of real estate transactions, the test in B.C. appears to be "whether the services either caused or materially contributed to the sale". Century 21 Gold Team Realty Ltd. and Pirie v. 443979 B.C. Ltd. (1996), Vanc. A933924. [14] Again, it seems to me that Mr. Turner has failed to establish that he provided services which benefitted the defendants which would entitle him to compensation. [15] Accordingly the plaintiff's case is dismissed with costs. "G.W. Lamperson" LAMPERSON J.