BB103

BUSINESS LAW

TUTORIAL 1 Essay Question 1.1 ABC Sdn. Bhd. advertises in the New Strait Times that there is a vacancy for the post of customer service executive. Is this advertisement an offer to contract? Give reasons for your answer. (10 marks) Suggested solutions: The issue in the given situation is whether the advertisement is an offer to contract. Section 2(h) of the Contracts Act 1950 defines contract as an agreement enforceable by law. In order for an agreement to be enforceable by law, it must consist of six essential elements which are offer, acceptance, consideration, intention to create legal relation, capacity and certainty. Offer is defined in Section 2(a) of the Contracts Act as something which is capable of being converted into an agreement by its acceptance. An offer is to be distinguished from an invitation to treat. Examples of invitation to treat, among other, are display of goods, auction and advertisements. An advertisement is only an invitation to applicants to make offer and not an offer itself. In the case of Coelho v. The Public Services Commission, the applicant had applied for a position in response to a newspaper advertisement. He was later informed that his application had been accepted. Subsequently, the Public Service Commission attempted to terminate his employment on the basis that he was appointed on probation. The applicant then applied to the court for an order to quash the decision. It was held by the court that the advertisement was an invitation to qualified persons to apply and the resulting application were offers. Therefore, termination of the applicant was invalid. Thus, the job vacancy advertisement in the New Strait Times advertised by ABC Sdn. Bhd. is only an attempt to induce offer. An offer only constituted when applicants write in to ABC Sdn. Bhd. applying for the customer service executive post. In conclusion, the advertisement is not an offer to contract.

KHOLYN RURAN JONATHAN / UCSI UNIVERSITY

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