When buying or selling property in Queensland, it is common for parties to communicate directly with a real estate agent throughout the transaction.
However, an important distinction exists between an agent facilitating a property sale and having legal authority to change the terms of a binding contract.
A buyer may assume that an assurance from the selling agent is sufficient to extend a contractual deadline. That assumption can have serious financial consequences if the seller has not authorised the change.
The Queensland Supreme Court decision in Evans v Jan [2025] QSC 31 demonstrates the importance of understanding the limits of a real estate agent’s authority and the consequences of failing to comply with contractual obligations.
Background to the Dispute
In January 2024, Stephen Evans entered into a contract to purchase a residential property at Shailer Park, Queensland, from Yea Lan Jan.
The purchase price was $985,000, with a deposit of $98,500 payable when both parties had signed the contract.
The parties signed the contract electronically on 22 January 2024, and the contract was formed the following day.
The deposit was therefore required to be paid on 23 January 2024.
However, the buyer encountered difficulties transferring the funds because his bank imposed a daily transfer limit of $50,000.
The buyer did not make any payment towards the deposit on the required date.
On 24 January 2024, the buyer transferred $45,000 and informed the real estate agent that he intended to pay the remaining balance the following day.
The agent responded by text message:
“Ok. As long as I let seller know. Two deposits today and tmr”
The buyer understood this communication to mean that the seller had agreed to the proposed payment arrangement.
On 25 January 2024, the buyer completed payment of the remaining deposit through several transfers, bringing the total amount paid to $98,500.
Despite receiving the full deposit, the seller subsequently terminated the contract on 29 January 2024 because the deposit had not been paid by the contractual deadline.
The buyer commenced proceedings in the Supreme Court of Queensland seeking an order requiring the seller to complete the sale.
What Did the Court Decide?
The central issue before the Court was whether the real estate agent had authority to agree to the late payment of the deposit on behalf of the seller.
The buyer argued that the agent’s communications had effectively confirmed an extension of time.
He also argued that the seller had affirmed the contract or was prevented from terminating it because of the agent’s representations.
The Court rejected those arguments.
Did the Agent Have Authority to Extend the Deadline?
The Court examined whether the agent had actual authority or ostensible authority to agree to the payment arrangement.
Actual authority arises where a person has been authorised to act on behalf of another.
Ostensible authority may arise where the principal’s representations or conduct lead another party to reasonably believe that the agent has authority to act.
In this case, the Court found that the agent had neither form of authority to approve the delayed payment.
Under the relevant REIQ contract, the selling agent was appointed to introduce a buyer, while the deposit was required to be paid in accordance with the contract.
The agent’s involvement in negotiating the sale did not automatically authorise her to alter the deposit arrangements.
Importantly, the seller had not instructed the agent to extend the deadline and was unaware of the communications relied upon by the buyer.
The Court also found that the buyer had not established that he acted in reliance on any representation that the agent had authority to approve the revised payment arrangements.
Notably, the buyer had already begun transferring funds before receiving the agent’s reply, so he was effectively setting his own payment schedule rather than acting in reliance on the agent’s text message.
Had the Seller Accepted the Late Payment?
The buyer further argued that the seller had affirmed the contract by allowing the deposit to be paid after the deadline.
However, the Court found that the agent’s text messages did not amount to an unequivocal decision by the seller to continue with the contract despite the breach.
Even an apparently reassuring message from an agent will not constitute an affirmation of the contract unless it is an unequivocal representation made with the seller’s authority.
The seller had not been aware of the missed payment deadline at the relevant time and had not authorised the agent to accept an extension.
The Court therefore rejected the argument that the seller had elected to affirm the contract.
The buyer’s alternative argument based on promissory estoppel was also unsuccessful because the relevant representations could not be attributed to the seller.
The Consequences for the Buyer
On 27 February 2025, the Supreme Court ruled in favour of the seller.
The Court dismissed the buyer’s claim for specific performance and ordered that the $98,500 deposit be forfeited to the seller, together with interest at the applicable contract rate.
The outcome is significant because the buyer had ultimately paid the entire deposit before the seller terminated the contract.
However, the subsequent payment did not remedy the earlier breach of an essential contractual obligation or prevent the seller from exercising her termination rights.
The decision demonstrates that a buyer cannot assume that a late payment has been accepted simply because the deposit holder receives the funds.
What Does This Mean for Queensland Property Transactions?
The decision in Evans v Jan provides an important reminder that real estate agents do not necessarily have authority to vary contractual obligations on behalf of their clients.
While an agent may be authorised to negotiate a sale or receive a deposit, that authority does not automatically extend to changing contractual deadlines.
If a buyer requires additional time to satisfy an obligation, the proposed extension should be referred to the parties’ solicitors and formally agreed upon before the deadline expires.
This is particularly important where time is of the essence under the contract.
For sellers, the decision also demonstrates the importance of maintaining clear communication with their agents regarding contractual matters.
An agent should not assume that an extension has been approved without obtaining the seller’s instructions.
Similarly, buyers should not rely on informal assurances where the proposed arrangement differs from the terms of the signed contract.
The Importance of Obtaining Legal Advice
Property transactions often involve strict deadlines, and even seemingly minor departures from the contractual requirements can have substantial consequences.
The decision in Evans v Jan demonstrates that informal communications with an agent may not provide the legal protection a buyer expects.
Before agreeing to an extension or relying on a proposed variation, the parties should ensure that the arrangement is properly authorised and documented.
Obtaining legal advice at an early stage can help avoid uncertainty and reduce the risk of a contractual dispute.
How Vojdani Lawyers Can Assist
Vojdani Lawyers advises buyers and sellers on residential and commercial property transactions throughout Queensland.
Our property lawyers assist clients with reviewing contracts and negotiating contractual variations, including extensions of time and deposit arrangements.
We work closely with our clients to ensure that their contractual obligations are clearly understood and that appropriate protections are in place throughout the transaction.
Contact Vojdani Lawyers for advice on your next property transaction.