BAILEY V ANGOVE'S PTY LTD

[2016] UKSC 47, Supreme Court, Lord Neuberger, Lord Clarke, Lord Sumption, Lord Carnwath and Lord Hodge, 27 July 2016

Agency - Authority - When authority of agent irrevocable - Receipt of money by agent imminently insolvent - Constructive trust

Angove's was an Australian winemaker. D&D Wines, an English company, was its agent and distributor in the United Kingdom. D&D bought wines from Angove's and sold wines on Angove's behalf to UK customers, generally retailers. The Agency and Distribution Agreement (ADA) between the parties, dated 1 December 2011, was, by clause 34 terminable by either side on six months' notice, or, under clause 36, by notice with immediate effect in a number of events, including the appointment of an administrator or liquidator. On 21 April 2012 D&D went into administration. At that time there were outstanding invoices for AUS$874,928.81, representing the price of wine which D&D had sold to two UK retailers. On 23 April 2012 Angove's gave written notice terminating the ADA and withdrawing the authority of D&D to collect the price from these two customers. The notice declared that Angove's proposed to collect the price directly from the customers and would account separately to D&D for their commission. D&D's liquidators claimed that they were entitled to collect on the outstanding invoices, deduct commission due to D&D, and leave Angove's to prove in the winding up for the rest of the price.