Name(s)

SHALINI A/P ANNATHURAI (AM 1901005034)

MUHAMMAD ALIFF HAIKAL BIN SALMAN (AM 1901005107)
ATHIRAH IZWIN BINTI IDRIS (AM 1909007134)
MUHAMMAD SYAFIQ BIN ESA (AM 1901005069)

Lecturer Lab group / Tutorial group /

SIR MAIZUDIN

Course and Course Code Submission Date:

BUSINESS LAW / LAW 201 9 OCTOBER 2020

Assignment No. / Title Extension & Late submission:

WRITTEN REPORT Allowed / Disallowed

Assignment type: % of Assignment Returning Date:

GROUPING Mark
Penalties:
1. 10% of the original mark will be deducted for every one-week period after the submission
date
2. No work will be accepted after two weeks of the deadline
3. If you were unable to submit the coursework on time due to extenuating circumstances you
may be eligible for an extension
4. Extension will not exceed one week

Declaration: I/we the undersigned confirm that I/we have read and agree to abide by these
regulations on plagiarism and cheating. I/we confirm that this piece of work is my/our own. I/we
consent to appropriate storage of our work for checking to ensure that there is no plagiarism/
academic cheating.

This section may be used for feedback or other information

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PART A

QUESTION 2

Ali is a dealer in second-hand goods. He seeks your legal advice on the following matters. Ali entered
into a contract with Ben for the purchase of an old grandfather clock from Ben for RM200. Ben has
since refused to sell the clock to Ali, stating that the price is too low and that the actual value of the
clock is RM2,000. Besides that, Ali contracted with Ashley, aged 16, to sell him a vase for RM15,000.
Ashley has refused to honour the contract, stating that it is void.

Explain whether Ali has the right to purchase the clock at the agreed price of RM200 and whether the
contract between Ali and Ashley is void. (Confine your answers to the law of contract).

(20 marks)

ANSWER

Issue

The issue in this case is whether there is valid consideration for the contract between Ali and Ben. Ben
claims that the consideration of RM200 is too low. Under the law of contract, consideration must be
sufficient but need not be adequate.

Law

1) Section 11, Person is competent to contract if he is of the age of majority.

2) Age 18 years of sound mind not disqualified from contracting by any law.
3) Person are not competent is minors, insane or drunken during making a contract.
4) MOHORI BIBEE V DHURMODAS GHASE
5) Held: Contract is void- sect 10 & sec 11 Contract Act.
6) Consideration must be lawful.
7) Consideration must be sufficient/it need not be adequate.
8) S26 e.g.: X promises to sell his car for RM2.000, it is the amount sufficient consideration for the
promise.
9) Phang Swee Kim v Beh I Hock

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Application

1) This case is whether or not there's a valid consideration for the contract between Ali and Ben.
Ben claims that the concern of RM200 is just too low.
2) Under the law of contract, care must be sufficient but needn't be adequate. Sufficiency of
consideration means it must have some value, and it needn't necessarily be of equal value.
3) Thus, Ali may be advised that there's a legitimate contract between him and Ben and he has the
proper to get the clock at the agreed price of RM200.

Conclusion

It can be conclude that Ali has the right to purchase the clock at the agreed price of RM200 because
there is a valid contract between him and Ben. And for other case, it can be concluded that the contract
entered into with Ashley is void. If a minor, i.e. a person under the age of 18 years, enters into a contract,
the contract is void, unless it falls within certain exceptions.

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PART B

QUESTION 2

Geremy owns a shop in Kuala Lumpur. The shop sells various types of internet mobile phones. Last
week, new stocks of internet mobile phones arrived from the United States (US) and an East Asia
country (East Asia). The internet mobile phones from US were the original “Orange Phone" product,
while the ones from East Asia were not, though the features looked alike.

Iris, another customer, visited Geremy’s shop, looking for a white “Orange Phone V.4”. Geremy told her
that the shop had run out of the white version, but he (Geremy) had one last new unit of white
“Orange Phone V.4” in his house. Iris agreed to buy that unit. However, unknown to Geremy, his house
was burgled two hours before that and the Orange Phone was stolen.

Explain whether there was a valid contract formed between Iris and Geremy. (Confine your answers to
the law of contract).

(20 marks)

ANSWER

Issue

The issue in this case is that there is acceptance for the contract between Geremy and Iris. Geremy
claims that the Orange phone V4 unit is at home and Iris have agreed to it. Under the law of contract,
acceptance Geremy give hope to Iris that he has the Orange phone V4 white unit at his home which
have requested by Iris but Geremy doesn’t know that Geremy’s house had been burgled two hours
before and the Orange phone V4 white unit have been stolen.

Law

1) Sales of goods under section 2: A contract of sales of goods is a contract whereby the seller
transfers or agrees to transfer the property in goods to the buyer for a price.
2) There may be a contract sale between one part-owner and another.
3) Goods means every kind of moveable property other than actionable claims and money.
4) “Price” means the money consideration for a sales of goods.
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5) Rowland v Divall

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Application

1) In this case, Geremy is making a legitimate contract formed.

2) It's an effort to induce an offer, and during this situation, Iris is that the offeror.
3) By applying the laws above, Iris has the proper not to accept the request made by Geremy's
shop.

Conclusion

It can be conclude that there was a valid contract formed between Iris and Geremy as acceptance
Geremy give hope to Iris that he has the Orange phone V4 white unit at his home which have requested
by Iris

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