The claim was made by an area sales agent who was responsible for recruiting, supervising and training several double glazing sales agents for the effective marketing and selling of Zenith’s products. As such Mr Hunter did not directly undertake representative activities himself. Zenith argued that Mr Hunter’s activities were secondary and so Mr Hunter was not entitled to the rights and protections granted by the Regulations.

The Regulations do not apply to agents whose activities as commercial agents are to be considered secondary. The Regulations set out a non-exhaustive list of criteria that will indicate whether a person’s activities as commercial agents are to be considered secondary.

Surprisingly the judge considered that substantially the whole of Mr Hunter’s time was given over to representative activities. In doing this the judge made it clear that he considered that “in appropriate circumstances” an agent has to be able to act through servants or agents. Despite arriving at this decision, the judge decided that Mr Hunter was nevertheless not a commercial agent within the meaning of the Regulations. This was on the basis that one of the criteria in the Regulations which would indicate that the activities were not secondary did not apply.

The criterion concerned requires that a transaction procured by the agent on one occasion is likely to lead to further transactions in those goods with the same customers or in the same area on future occasions. The judge accepted that this could possibly be the case in the long term, but for double glazing products it was unlikely to be so in the short term.

In arriving at this decision the judge ignored other equally valid tests in the Schedule the application of which would have been likely to have been in Mr Hunter’s favour. Ironically, the court arrived at the right decision for the wrong reason!

This briefing note is for general information. For advice in applying this general information to your specific circumstances, please contact Jane Elliot or any member of the Fox Williams’ agentlaw team.(www.agentlaw.co.uk)

Written by Jane Elliot

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