1. The case: Cassation, en banc, 2 August 2017, No. 19161.
In order to obtain the payment of the commission allegedly due to it by reason of the brokerage activity carried out, the owner of a consulting firm in the industrial sector sued a corporation. The defendant replied objecting in the first place that the agreement on consideration was invalid since the plaintiff was not enrolled in the list of brokers provided for by Law No. 39/1989.
In the first instance proceeding the Court of Verona ordered the company to pay, classifying the activity carried out by the owner of the consulting firm as mere procurement of business and, as such, not subject to the provisions of Law No. 39/1989. In the appeal proceeding, the Court of Venice overturned the decision due to the plaintiff’s failure to prove its registration with the register of professional brokers, which the Court considered as an essential requirement in order to obtain the right to commission.
Following the plaintiff’s appeal to the Supreme Court, the second division of the Supreme Court, in light of the case-law conflict on atypical brokerage activity, deemed it necessary for the Court to sit en banc to consider the possibility to apply the rules and regulations governing brokerage also to business procurement, thus deciding whether or not those carrying out said activity need to be registered in the specific registers or lists in order to claim payment for their services.
2. Brokerage, business procurement and agency relationships: introductory references
In order to properly understand the issue under examination, one should briefly refer, as introduction, to the main key points of the rules and regulations on brokerage, the so-called atypical (or unilateral) brokerage and business procurement, in other words all type of contracts – with the exclusion of agency agreements – having as their subject-matter the provision of services aimed at the conclusion of contracts between the parties.
- Brokerage, governed by Articles 1754 and the following of the Italian civil code, is characterised by the duty of impartiality imposed on the broker in the carrying out of his/her activity and by the obligation to register in the specific Register of enterprises or in the Economic and Administrative Index (R.E.A.), which is an essential element to give rise to the right to receive a commission for the activity carried out.
- The so-called atypical brokerage is, instead, that particular type of brokerage resulting in the setting up of relationships with only one of the party, whose interests are looked after by the broker.
- Business procurement is a contractual scheme not governed by the Italian civil code partially similar to both brokerage and agency relationships. The business developer undertakes, in exchange for a consideration, to promote the conclusion of businesses between the entity which appointed him/her and in whose interest he/she acts, and third parties. Contrary to agency relationships, business procurement is characterised by the absence of subordination and lack of stability.
3. Positions adopted in case law on business procurement
As mentioned above, the decision submitted to the Supreme Court in the case at issue concerned the possibility to include business procurement within the rules and regulations positively established on brokerage, in particular with regard to the invalidity of the agreement on commission should the persons acting as brokers not be registered in the register of enterprises or in the Economic and Administrative Index (R.E.A.).
Previous positions adopted by case law on the mater follow two main trends.
According to the first view, the essential core of brokerage is represented by the duty of impartiality: a business developer, who is not subject to said duty, would consequently not be subject to the application of Article 6 of Law No. 39/1989. The registration in the specific registers or lists does not represent, for this category of professionals, a requisite to give rise to the right to commission.
According to the second view, the real essential core of brokerage is represented by the activity aimed at bringing two or more parties together for doing business. In this perspective, for the purpose of fighting the performance of unregulated activities by morally and professionally unqualified persons, business procurement is classified as a form of atypical brokerage and therefore included within the scope of applicability of Law 39/1989.
4. The decision of the Supreme Court en banc of 2 August 2017
The Supreme Court en banc, which was required to settle the case-law conflict, deemed that the second position should be adopted.
The reasoning of the Supreme Court is based on the observation that the so-called intermediaries’ role is divided in four sections, respectively dedicated to: (i) real estate brokers; (ii) commodities brokers; (iii) brokers with an agreement for valuable consideration (encompassing atypical brokers); (iv) brokers for various services.
Article 2, fourth paragraph, of Law No. 39/1989 establishes that the registration in the so-called roll of brokers with an agreement for valuable consideration must be requested by those carrying out – even on an occasional or discontinuous basis – activities for the conclusion of transactions concerning real estate or companies: hence excluding atypical brokerage activities carried out occasionally in relation to movable property.
Committing to the aforesaid second position, and thus considering business procurement as a form of atypical brokerage, the Court ruled that a business developer who (i) professionally performs his/her activity or (ii) performs his/her activity on an occasional basis in relation to real estate or companies, has the obligation to register with the register of enterprises or the Economic and Administrative Index (R.E.A.).
In summary, in the light of such considerations the Supreme Court established that, should the activity be carried out on a professional basis, irrespective of the form of brokerage, and regardless of its subject-matter, typical or atypical brokers (and hence also business developers) must register in the register of enterprises or the Economic and Administrative Index (R.E.A.) with all consequences arising from the failure to register with respect to the right to commission.