TUTORIAL EPPA 2823

LAW OF CONTRACT

QUESTION 1:Mario entered into the following two separate contracts with Paul:

(i) a contract to purchase Paul’s two-acre plot of land at Cameron Highlands for RM3
million, which reflects its fair market price; and
(ii) a contract to sell to Paul, his (Mario’s) motorcar, a Perodua Myvi, for RM50,000.
The market price of the car is RM55,000.

Subsequently Paul, without giving any reason, informed Mario that he did not want to
sell the land to Mario. Mario then told Paul, ‘In that case I refuse to sell you my car. I
will also sue you for breach of contract.’ Paul replied that he too would sue Mario for
breach of contract if Mario did not sell the motorcar to him as agreed.
Required:
Advise Mario regarding –
(a) the most appropriate remedy for him against Paul for breach of contract in
relation to Paul’s land; and
It is rescission cause he cancel the contract without any reasons

(b) the most likely remedy which the court may order against him (Mario) in
favour of Paul for breach of contract in relation to the sale of the motorcar
Injunction , cause he prohibit paul from buying the car after he cancel the contract

QUESTION 2
In relation to contract law explain and distinguish between:
(a) a proposal (offer) and an invitation to treat; and
Offer : it is invitation to trade and and give the offer, while the invitation to treat it is intention
to trade not an offer

(b) an acceptance and a counter-proposal (counter-offer

When the pearson to whom the proposal is made significant , the proposal when accepted
become a promise.
Counter proposal : an offer made in response to another.

QUESTION 3
(i) Explain the facts and principle of law in Carlill v Carbolic Smoke Ball Co. Ltd. (1892).

Facts
The defendant, the Carbolic Smoke Ball Company, placed an
advertisement in a newspaper for their products, stating that any person
who purchased and used their product but still contracted influenza
despite properly following the instructions would be entitled to a £100
reward. The advert further stated that the company had demonstrated its
sincerity by placing £1000 in a bank account to act as the reward. The
claimant, Mrs Carlill, thus purchased some smoke balls and, despite
proper use, contracted influenza and attempted to claim the £100 reward

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 from the defendants. The defendants contended that they could not be
bound by the advert as it was an invitation to treat rather than an offer on
the grounds that the advert was: mere ‘puff’ and lacking true intent; that
an offer could not be made ‘to the world’; the claimant had not technically
provided acceptance; the wording of the advert was insufficiently precise;
and, that there was no consideration, as necessary for the creation of a
binding contract in law.

Held
The Court of Appeal found for the claimant, determining that the advert
amounted to the offer for a unilateral contract by the defendants. In
completing the conditions stipulated by the advert, Mrs Carlill provided
acceptance. The Court further found that: the advert’s own claim to
sincerity negated the company’s assertion of lacking intent; an offer could
indeed be made to the world; wording need only be reasonably clear to
imply terms rather than entirely clear; and consideration was identifiable
in the use of the balls.

QUESTION 4: On 10 April 2017, Ally, who lives in Kuala Lumpur, posted a

letter to his friend Monny, who lives in Pahang, offering to sell to Monny an
antique mirror for RM2,000. The letter reached Monny on 12 April 2017.
Monny accepted the offer by posting his letter of acceptance the very
same day. Due to a postal delay, Monny’s letter of acceptance only
reached Ally two weeks later, i.e. on 26 April 2017. Meanwhile, on 20 April
2017 Ally sold the vase to Lim, a rich businessman, who had offered him
RM10,000 for it. Monny, who has come to know of the sale of the mirror to
Lim, wishes to sue Ally for breach of contract. Discuss whether there
exists a valid contract between Ally and Monny? Support your answer with
TWO (2) statute provisions of Malaysia and ONE (1) case authority
Contracts Act 1950 .section (2)(b) : (b) when the person to whom the
proposal is made signifies his assent thereto, the proposal is said to be
accepted: a proposal, when accepted, becomes a promise;
Contract act s.7(b)be expressed in some usual and reasonable manner,
unless
the proposal prescribes the manner in which it is to be accepted. If the
proposal prescribes a manner in which it is to be accepted, and the
acceptance is not made in that manner, the proposer may, within a
reasonable time after the acceptance is communicated to him, insist that
his proposal shall be accepted in the prescribed manner, and not
otherwise; but, if he fails to do so, he accepts the
Acceptance.

The case authority : national land finance

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 QUESTION 5
Based on one case authority, explain what is quantum meruit.
There is a contract and suddenly the contract expired and you paid money
and you want your service to complete

QUESTION 6 Girlie, aged 15 years, the daughter of a well-known school

headmaster, wanted to attend a birthday party for her friend, Jackie, the
daughter of a glamorous film star. As she did not have a new dress for the
function, she ordered an expensive silk dress from a famous boutique. The
dress cost RM3,000. She used the dress for the function but has not yet
paid the purchase price of the dress. The boutique owner wishes to sue
Girlie for the purchase price.
Required: Advise the owner of the boutique on her prospects of success.
First of all this contract invalid since the girl it is not under capacity which
is she do not had the ability whether if she can keep up to her promise as
she consider as a children.
My advice for the owner of the boutiqe he had to make sure that the
second parties is had the element of capacity.

QUESTION 7 In April 2017 Betty borrowed RM200,000 from Duit and

promised Duit that she would repay the loan before October 2017. Betty
did not keep her promise and Duit has threatened to sue her. Two weeks
ago Betty’s father, Boss, offered to pay RM100,000 to Duit, if Duit would
accept the sum as full settlement of the loan made to Betty, and release
her from her obligation to pay the balance. Duit agreed to this proposal
and Boss paid the sum of RM100,000 to Duit last week. Yesterday Duit’s
solicitor, Mr Claim, contacted Betty and told her that she was still liable to
pay the balance of the loan. Mr Claim stated that Duit’s promise to release
her from the
balance of the loan was not binding on Duit. Betty seeks your advice
whether she is bound to pay the balance of the loan.
Advise Betty

QUESTION 8 Ah Seng, who owned a rare vintage car offered to sell it to

his friend Ramu. The offer was made through a letter dated 1 May 2017,
which was posted on the same day. The letter expressly stated that the
offer was only open until 10 May 2017. Ramu received the letter on 5 May
2017 and immediately posted his letter of acceptance to Ah Seng. Due to
a postal delay, this letter reached Ah Seng only on 12 May 2017.
Meanwhile, on 11 May 2017, Ah Seng, not having heard from Ramu, sold

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 the car to someone else. Advise Ramu: (a) whether he can successfully
sue Ah Seng for breach of contract; and (b) whether he is likely to obtain
the remedy of specific performance, in the event there was a breach of
contract by Ah Seng.

QUESTION 9 Explain the following essential elements of a valid contract:

(a) a proposal (offer); when one person signifies to another his willingness
to do or to abstain from doing anything, with a view to obtaining the
assent of that other to the act or abstinence, he is said to make a
proposal;
(b) acceptance; and when the person to whom the proposal is made
signifies his assent thereto, the proposal is said to be accepted: a
proposal, when accepted, becomes a promise;
(c)consideration. : when, at the desire of the promisor, the promisee or
any other person has done or abstained from doing, or does or abstains
from doing, or promises to do or to abstain from doing, something, such
act or abstinence or promise is called a consideration for the promise;
QUESTION 10 Explain the following remedies for a breach of contract:
(a) injunction;
which is an equitable remedy may be interlocutory, or mandatory. It may
even be prohibitory or restraining in nature

(b) damages.
losses or costs incurred due to anothers wrongful act. Damages are
granted to a party as compensation for the damage, loss or injury he or
she has suffered through a breach of contract

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