Kelly v Cooper and Another: PC 25 Nov 1992

There was a dispute between a client and an estate agent in Bermuda. The client sued the estate agent for damages for breach of duty in failing to disclose material information to him and for putting himself in a position where his duty and his self-interest conflicted.
Held: It was appropriate to imply a term into the contract to the effect that the agent was entitled to act for other principals selling competing properties and to keep confidential the information obtained from each of those principals, even though that information might well have been material to the client. Estate agents have no general duty to disclose the details of another sale to their client. The existence and scope of the duties of an agent, fiduciary and otherwise, depend on the terms on which they are acting. The court was able to imply into an express contract of agency a term entitling an estate agent to act for numerous other competing principals selling similar properties and to keep confidential information received from each principal. It was known to the principal that the estate agent would be so acting in the course of its business. The effect of the implied term was to modify the normally strict fiduciary duties owed by an agent to the principal not to put himself into a position where his duty and interest conflicted, not to profit from his position (for example, by earning commissions from selling properties for rival principals) and to make disclosure of confidential information to the principal.
Lord Browne-Wilkinson said: ‘In a case where a principal instructs as selling agent for his property or goods a person who to his knowledge acts and intends to act for other principals selling property or goods of the same description, the terms to be implied into such agency contract must differ from those where an agent is not carrying on such general agency business. In the case of estate agents, it is their business to act for numerous principals: where properties are of a similar description, there will be a conflict of interest between the principals each of whom will be concerned to attract potential purchasers to their property rather than that of another. Yet, despite this conflict of interest, estate agents must be free to act for several competing principals otherwise they will be unable to perform their function . . The scope of the fiduciary duties owed by the [estate agent] to the [client] (in particular the alleged duty not to put themselves in a position where their duty and their interest conflicted) are to be defined by the terms of the contract of agency.’
References: Gazette 25-Nov-1992, [1993] AC 205, [1992] 3 WLR 936, [1993] ANZ Conv R 138
Judges: Lord Browne-Wilkinson
This case cites:

  • Approved – Hospital Products Ltd v United States Surgical Corporation 25-Oct-1984
    High Court of Australia – A solicitor’s duty of loyalty to his client’s interest, and his duty to respect his client’s confidences, have their roots in the fiduciary nature of the solicitor-client relationship, but may have to be moulded and . .
    ((1984) 156 CLR 41, (1984) 55 ALR 417, (1984) 58 ALJR 587, 4 IPR 291, [1984] HCA 64, )

This case is cited by:

  • Cited – Silven Properties Limited, Chart Enterprises Incorporated v Royal Bank of Scotland Plc, Vooght, Harris CA 21-Oct-2003
    The claimants sought damages from mortgagees who had sold their charged properties as receivers. They said they had failed to sell at a proper value. They asked whether the express appointment in the mortgage of receivers as agents of the mortgagor . .
    (, [2003] EWCA Civ 1409, Times 27-Oct-03, Gazette 20-Nov-03, [2004] 1 WLR 997, [2004] 4 All ER 484)
  • Cited – DEG-Deutsche Investitions und Entwicklungsgesellschaft mbH v Koshy and Other (No 3); Gwembe Valley Development Co Ltd (in receivership) v Same (No 3) CA 28-Jul-2003
    The company sought to recover damages from a director who had acted dishonestly, by concealing a financial interest in a different company which had made loans to the claimant company. He replied that the claim was out of time. At first instance the . .
    (, [2003] EWCA Civ 1048, Times 09-Sep-03, [2004] 1 BCLC 131)
  • Cited – Parker v Parker ChD 24-Jul-2003
    Lord Macclesfield claimed a right to occupy a castle. The owners claimed that he had only a mere tenancy at will. The exact rooms in the castle which had been occupied had varied over time.
    Held: The applicant was entitled to reasonable . .
    (, [2003] EWHC 1846 (Ch))
  • Cited – Prince Jefri Bolkiah v KPMG (A Firm) HL 16-Dec-1998
    Conflicts of Duty with former Client
    The House was asked as to the duties of the respondent accountants (KPMG). KPMG had information confidential to a former client, the appellant, which might be relevant to instructions which they then accepted from the Brunei Investment Agency, of . .
    (Times 20-Apr-99, , , [1998] UKHL 52, [1999] 2 AC 222, [1999] 1 All ER 517, [1999] 2 WLR 215)
  • Cited – Hilton v Barker Booth and Eastwood HL 3-Feb-2005
    The claimant had instructed the defendant solicitors to act for him, where he was to contract with another client of the same solicitor in a land development. The solicitor failed to disclose that the other client had convictions for dishonesty, and . .
    (, , [2005] UKHL 8, Times 04-Feb-05, [2005] 1 WLR 567, [2005] 1 All ER 651, [2007] Lloyds Rep PN 1)
  • Cited – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
    The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
    (, [2005] EWHC 1638 (Ch))
  • Cited – Burkle Holdings Ltd v Laing TCC 23-Mar-2005
    The parties had each instructed the same solicitor, but now disputed the entitlement of the other to see documents held by the solicitor. . .
    (, [2005] EWHC 638 (TCC))
  • Cited – Ratiu, Karmel, Regent House Properties Ltd v Conway CA 22-Nov-2005
    The claimant sought damages for defamation. The defendant through their company had accused him acting in such a way as to allow a conflict of interest to arise. They said that he had been invited to act on a proposed purchase but had used the . .
    (, [2005] EWCA Civ 1302, Times 29-Nov-05, [2006] 1 All ER 571)
  • Cited – Imageview Management Ltd v Jack CA 13-Feb-2009
    The appellant company acted for the respondent footballer in placing him with a football club. The respondent said that he had also taken a payment from the club, nominally for arranging a work permit. The respondent said this was improper. The . .
    (, [2009] EWCA Civ 63, , [2009] WLR (D) 56, , [2009] 1 All ER (Comm) 921, [2009] 2 All ER 666, [2009] 1 BCLC 724, [2009] 1 Lloyd’s Rep 436, [2009] Bus LR 1034)
  • Cited – Rossetti Marketing Ltd v Diamond Sofa Company Ltd and Another QBD 3-Oct-2011
    Rossetti_diamondQBD2011
    The claimants sought compensation under the 1993 Rules. The defendants denied that the claimants were agents within the rules, since they also acted as agents for other furniture makers.
    Held: Whether a party is a commercial agent within the . .
    (, [2011] EWHC 2482 (QB))

These lists may be incomplete.
Last Update: 21 November 2020; Ref: scu.82715