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Faculty of Law
UiTM Shah Alam.
November 2016
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Federal & State Constitutions
CONTRACT =
Proposal +
Acceptance +
Consideration +
Intention to Create Legal Relations +
Capacity +
Legality +
Certainty
norliza abdul hamid / november 2016 6
ELEMENT (i) :
PROPOSAL / OFFER (Tawaran)
Section 2(1) Contracts Act 1950: 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
s.2 (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.
Presumptions
i. Family arrangements : Balfour v Balfour (1919)
ii. Commercial arrangements
iii. Exceptions
= valid contracts
Examples:
i. forbidden by law
ii. involves injury to person / property of another
iii. immoral purposes
Section 22
A contract is not voidable because it was caused by a mistake
as to any law in force in Malaysia ie. may be valid
Illustration : A and B make a contract grounded on the
erroneous belief that a particular debt is barred by limitation:
the contract is not voidable.
Issue:
Despite having seen the car, the court held that there was a breach and
granted damages to the buyer since the buyer relied on the description
given by the seller.
4 ways
i. Performance
ii. Agreement
iii. Breach
iv. Frustration
46
I. BY PERFORMANCE
47
WHO MUST PERFORM? SECTION 41
48
II. BY AGREEMENT
49
III. BY BREACH
50
ILLUSTRATION
51
EFFECT
A breach of contract
The other party may take legal action for breach
52
REMEDIES FOR BREACH
DAMAGES compensation for loss and damage.
SPECIFIC PERFORMANCE a court order to
53
IV. BY FRUSTRATION
when there is a change in circumstances which
renders contract legally / physically impossible to
perform.
54
2 CATEGORIES
55
SECTION 57(1) CONTRACTS ACT 1950
56
CONTRACT TO DO AN ACT WHICH
AFTERWARDS BECOMES IMPOSSIBLE OR
UNLAWFUL.
57
EXAMPLE : DESTRUCTION OF SUBJECT
MATTER
58
EXAMPLE : PERFORMANCE BECOMES
UNLAWFUL
59
EXAMPLE OF SUPERVENING EVENT
WHICH DEFEATS THE WHOLE
PURPOSE OF CONTRACT
Krell v Henry (1903)
60
EFFECT OF FRUSTRATION
Contract becomes void.
Section 66 : Any person who has received any benefit /
advantage, is bound to restore it, or to compensate for
it to the person whom he received it from.
61
HOWEVER:
One party may not sue the other, because
contract is not breached.
The frustrating event was not due to anybody's
62
ADDITIONAL POINTS
A contract may be governed by other law and/or in addition
to the Contracts Act 1950
Examples :
Sale of goods Sale of Goods Act 1957
Consumer goods & services : Consumer Protection Act 1999
Partnership : Partnership Act 1961
Hire purchase : Hire Purchase Act 1967
64 22 September 2016
64
Palace of Justice, Putrajaya
65
65 22 September 2016
The End Thank You.