[27] It seems to me arguable that there is no general rule that real estate agents who introduce purchasers to deal directly with a vendor breach fiduciary obligations imposed within the scope of their contract if they fail to communicate information about the purchaser which might be material. It depends on the context. Real estate agents are obliged to pass on offers to vendors, because such obligation is squarely within the scope of what they are engaged to do. affects advice given by the agent (such as advice as to price or terms), nondisclosure may well breach the obligation of loyalty. There will be breach of the obligation of loyalty if non-disclosure amounts to the preference of the interests of the agent or another party33 (as may be the case, for example, if a risk associated with the purchaser material to the sale is not disclosed in order to complete a sale and obtain commission). I have reservations however whether a more general duty to provide material information, such as it is appropriate to impose upon agents who have power to bind their principals, applies in all cases. It may set the standard to be required of a canvassing agent too high.
In contrast Blanchard J held essentially that agents were agents ….
[77] If Kelly v Cooper were to be followed in a like case in New Zealand, a matter which it is unnecessary to resolve in the present case, it would require of real estate agents in this country a lesser standard than is required of other agents. As the editors of Bowstead & Reynolds on Agency say, the implication of a term excluding fiduciary duties, or particular duties, is not easy to justify. It seems to us that in circumstances of this kind an agent should decline to continue to act for the vendor of the second property as regards to the particular purchaser unless released by the vendor of the first property from the obligation of confidentiality as to the fact of the first sale to that person, or unless an adequate disclosure of the existence of a conflict of interest relating to the purchaser has been made and the vendor of the second property has confirmed that he or she nevertheless wishes to receive the offer. The difficulty that a stricter requirement may occasionally produce for agents would not seem to be a sufficient reason for dispensing in their case with the obligation of total loyalty or, as it is sometimes putin this context, the utmost good faith
In terms of damages, the Majority in the Supreme Court restored the High Court decision. The defendant had not displaced the burden created by Brickenden to show that the plaintiffs would have behaved as they in fact did, if they had been properly informed. The Chief Justice, in contrast, preferred the Court of Appeal’s holding that it had been likely that the plaintiff would still have settled for the lesser amount if they had been told of the purchasers’ intention. The Fate of the Real Estate Commission All required Premium to return their Commission. This was not a case where the plaintiff ought to have been required to elect between the obligation to account, and the ability to seek compensation. Rather the Court considered that Premium had so failed in its role that it could keep the commission that it had charged. Fighting words at the end Tipping J’s concurrence tried to put the decision in wider context and had a number of interesting things to say on the role of damages generally. He makes some generally comments about the restorative nature of damages including what might be considered by others to be restitutionary. He draws on Edleman’s Gain-Based Damages: Contract, Tort, Equity and Intellectual Property (2002). Just how convincing his wider view is, time with tell. He ends his judgment with what some, especially in New South Wales, might consider fighting words
[111] I close by saying that I have throughout these reasons used the single unqualified word “damages” without reference to the historical source of the cause of action upon which they are based. I do not regard it as necessary or appropriate to speak any more of common law damages, equitable damages or, indeed, equitable compensation. An understanding of the historical source of the cause of action will often be helpful for substantive purposes but, when monetary relief is being referredGeoff McLay Reader