gary chua (finished)

7/27/2019 Gary Chua (Finished)

1/3

iNDIVIDUAL ASSIGNMENT

TOTAL: 20 MARKS(a)On the 1stAugust 2013, Mary received a letter fr om James off er ing to sell Mary hi s

Samsung Tablet I I for the sum of RM1000. In his letter, James stated that i f he did not

hear from Mary by letter or otherwise, with in two(2) weeks, James would presume that

Mary had accepted his offer. Mary did not reply. 3 marks

Under S.3 of the Civil Law Act 1956, common laws and rules of equity as administered on the 7th

ofApril 1956 are applicable within Malaysian jurisdiction unless there are any other provisions outlinedunder Malaysian law. English law after 1956 are not binding, however where the Contracts Act 1950have remained silent, Malaysian courts have been known to resort to English law.

S.10 of the Contracts Act 1950 states that the ingredients of a contract are fourfolds: there must befree consent, parties must be competent to contract, there must be lawful consideration with a lawfulobject and are not hereby expressly declared to be void.

Here, James has made an offer to Mary for the sale of a Samsung Tablet II. In the case ofPrestonCorp Sdn Bhd v Edward Leong [1982] 2 MLJ 22, the federal court proposed that an offer is an

intimation of willingness by an offeror to enter into a legally binding contract. Its terms eitherexpressly or impliedly must indicate that it is to become binding on the offeror as soon as it has been

accepted by the offeree. This view seems to have been adopted from the philosophy propounded byTreitel in para 2-002 of the 13

thedition of the Law of Contract, which the federal court has chosen to

adopt.

The crux of the issue here lies in Marys silence. Does silence amount to acceptance? This requires

analysis upon S.3 of the Contracts Act 1950, which states acceptance of proposalsto be made by

any act or omission of the party accepting. As a general rule, silence does not amount to

acceptance, however there are exceptions. The High Court of Malaysia has applied an objective test to

this rule in the case ofNai Yau Juu v Pasadec Corp Sdn Bhd [2005] 3 MLJ 431 and the case of Ayer

Hitam Tin Dredging Malaysia Bhd v YC Chin Enterprise Sdn Bhd [1994] 2 MLJ 754, which states

that the offeror may be bound if a reasonable man would believe that the offeror intends to be bound.

Omission can be a form of acceptance, but there is no case law to directly illustrate this.

Nevertheless, the proposer(offeror) cannot, without the promisees consent, put a condition in his

proposal that the promisees silence shall amount to acceptance. In fact, silence on the part of the

offeror cannot impute acceptance and no binding contract. Hence, the offeror cannot unilaterally

impose the condition that the offerree is bound by the agreement upon his failure to act or accept the

offer. This follows the English case of Felthouse v Bindley.

As such. No clear acceptance has been made on the part of Mary and James may not impose upon

Mary for the performance of the contract, and no binding contract existed.


2/3

(a)(ii) On the 2nd August 2013, Mary went out shopping at Giza Mega Mall and saw

a designer handbag displayed in a shop window and marked at RM30. Mary was

very excited and quickly went into the shop, took the handbag and went to the

counter to pay for it. However, she was told by Rachel, the shop owner that the

handbag had been tagged wrongly and the price of the handbag was actually

RM3000. Mary was very angry with Rachel. Mary felt that since the designerhandbag was 'offered' at RM30, Rachel should honour the 'offer'.. Mary did not

want to buy the designer handbag anymore. 7 marks

An invitation to treat is a statement that, unlike an offer, is not intended to be binding. The test for

this is objective, and an invitation to treat merely suggests a willingness to negotiate on terms

proposed. The general rule for a display of goods for sale in a shop is that it is an invitation to

treat, and not an offer. This follows the famed case of Fisher v Bell [1961] 1 QB 394, where it

was contended that a shopkeepers display in his shop window offlick knives was an offer for

sale contrary to the Restriction of Offensive Weapons Act 1959. It was held that the display of an

article in a shop window is merely an invitation to treat, and has been cited with approval in local

jurisdiction within the case of Sulisen Sdn Bhd v Kerajaan Malaysia [2006] MLJ 341. As such,

Rachel had the right to vary the terms of the price of the article being the designer handbag, as the

display in the shop window was a mere invitation to treat, and no binding contract has been made.

(b)As she walked out of Giza MegaMall, Mary bumped into her friend Michael.Michael immediately apologised to Mary for not repaying a loan of RM2000 which

was given to Michael by Mary seven(7) years ago. Michael promised to repay Mary

the RM2000 if Mary came to his house the next day. 5 marks

This scenario must first provoke an explanation of the intricacy that is inherently interwoven into

the doctrine of consideration. The definition of consideration is expounded in the English case

Dunlop Pneumatic Tyre Co Ltd v Selfridge & Co Ltdby Lord Dunedin, which states thatconsideration is an act or forbearance of one party, or the promise thereof, [which] is the price for

which the promise of the other is bought, and the promise thus given for value is enforceable.

Consideration is a creature of law which takes two forms: that of an executory form: which is an

exchange of promises to do something in the future, or an executed form: which is the act

constituting consideration is completed. Currie v Misa further expands the doctrine of

consideration, stating that a valuable consideration in the eye of the law may consist in either

some right, interest, profit or benefit accruing to one party, or some forbearance, detriment, loss

or responsibility given, suffered or undertaken by another. Sufficiency of consideration is

notable: consideration may be sufficient but need not be adequate. Sufficiency is considered

within legal dimensions: it must be legally sufficient as opposed to manifestations of a physical

value. Malaysian law differs from this: The inadequacy of the consideration is a fact which thecourt should take into account in considering whether or not one partys consent was freely given.

UnderS.26(C) of the Contracts Act 1950, an agreement made without consideration is void

unless it is in writing and registered; if it is a promise made in writing and signed, the creditor

might be able to enforce payment but for the law for the limitation of suits. The cases upon this

matter within local jurisdiction is scarce, but reference may be made to the illustrations provided

under the Act of Parliament. The situation of Mary and Michael emulates that of explanation (e)

of the same section of the act, which states that A owes B RM 1,000, but the debt is barred by

limitation. A signs a written promise to pay B RM 500 on account of the debt. This is a contract.

Under the authority ofS.6 of the Limitation Act 1953, the limitation period for contractual matters

is 6 years.


3/3

As a result of this, Mary may not be able to enforce the recovery of the sum of RM 2,000 unless

she solidifies Michaels promise to that of a written manifestation.

When she went home, Mary found her ex-husband Donny waiting for her. He immediately

took out a knife and threatened to kill her if she did not sign a transfer of the house to him.Mary was so scared that she immediately signed the transfer. 5 marks

ii. whether the transfer in favour of Donny is valid since she was forced to sign it.

Duress is a form of pressure regarded as improper and developed by English common law. There

are 3 principal forms of duress, and the form highlighted here is that of duress of persons. The

effect of duress is that the innocent party may choose to either affirm or rescind the contract. As

such, contracts made are valid until set aside.

Duress to the person covers that of actual or threatened physical violence or unlawful constraint

directed at contracting party or family members. The scenario referred to in Mary and Donny is

similar to that of the English caseBarton v Armstrong [1976] AC 104, wherein A threatened tokill B and his wife if B did not sign a deed. B went on to sign the deed based on 2 rationales:

firstly, that he was threatened, and secondly, for sound commercial reasons. The significance of

the case highlights that there must exist a causal link between duress and entry into contract, and

it was held that duress needs only to be a cause and not the sole cause of entry into contract. It

was held that it must first be identified that the pressure is one of which the law does not regard

as legitimate, such as that of the threat of murder.

The first step lies in that Mary must show that an illegitimate means of persuasion was used, and

then establish the relationship between the illegitimate means used and the actions consequently

taken.

In light of the case of Barton v Armstrong, analysis into the Contracts Act 1950 must be taken.

Duress has not been explicitly referred to within the act. However, coercion has been taken for a

similar meaning within S.15 and S.73 of the Contracts Act 1950. S.15states that Coercion is the

committing, or threatening to commit any act forbidden by the Penal Code, or the unlawful

detaining or threatening to detain, any property, to the prejudice of any person whatever, with

the intention of causing any person to enter into an agreement. In this case, Donnys threat to kill

Mary would amount to extortion underS. 383 of the Penal Code, which states that whoever

intentionally puts any person in fear of any injury to that person or to any other, and thereby

dishonestly induces the person so put in fear to deliver to any person any property or valuablesecurity, or anything signed or sealed which may be converted into a valuable security, commits

extortion. As such, this satisfies the requirement laid out in S.15 of the Contracts Act 1950 and

Mary, being the innocent party, will be allowed to either affirm or rescind the contract.

Furthermore, Donny is required to return the house to her under the authority of S.73 of the

Contracts Act 1950, which states that a person to whom money has been paid, or anything

delivered,by mistake or under coercion, must repay or return it.

gary chua (finished)

Documents