Bakar is the President of a mountain climbing association situated in Kampar.

To
encourage and promote the sport of mountain climbing in Kampar, he inserted an
advertisement in the local newspapers dated 15 April 2017. In it, he promised that he would
pay a sum of RM5,000 to the first person who reaches the summit of Mount Kampar. The
race was scheduled to commence on 01 May 2017 at 8.00 a.m. In the morning of the day
of the race, the participants gathered at the foot of Mount Kampar. The race began at 8.00
a.m. Simon Lee was the first person to reach the summit. Thereafter, he approached Bakar
to claim the winning price money of RM5,000 but Bakar refused to pay him stating that it
was merely an advertisement and neither was there any acceptance of participation from
Simon Lee.

Advise Simon Lee.

Would your advice differ if Bakar had used a loudspeaker to inform the climbers that the
mountain climbing event is cancelled after the climbers had started climbing the mountain?

This is merely a guide on how to approach such a problem-based question.

Paragraph and explain each point in sufficient detail.

Identification of issues
Whether the advertisement inserted in the newspapers by B constitutes a proposal or is it
an invitation to treat.
Whether there exist a valid contract between B and SL.
Whether B would be entitled to revoke the proposal once the race had commenced.

Explanation of the law

Define a contract – an agreement enforceable by law - 2(h); s. 2(g)
Explain ‘proposal’ – s. 2(a) – clear and unambiguous words – Ho Ah Kim v. Paya Trubong
Estate SB.
Distinguish a ‘proposal’ from an ‘ITT. Advertisements are generally ITT – Coelho v. PSC;
Eckhardt Marine GMBH v Sheriff, High Court of Malaya, Seremban & Ors;
Explain acceptance – s. 2(b). Must be a mirror image of the proposal. s. 7(a) – absolute &
unequivocal. General rule: Acceptance must be communicated to the proposer - Entores v.
Miles Far East Corporation.
Distinguish between bilateral & unilateral contracts.
Bilateral contract – promise made in exchange of a promise – mutual exchange of promises.
Promises are binding on them. There is liability for non-performance. Position is different
in the case of unilateral contracts – explain ‘unilateral contracts’ – promise made in return
for the performance of an act. S. 8 – acceptance by performing the conditions stipulated in
the proposal. Acceptance by conduct.
Unilateral contracts are also known as ‘executed consideration’- the required act needs to
be performed or executed. The promisee makes no promise. He is under no obligation to
perform the conditions. He incurs no liability for non-performance. Communication of
acceptance is impliedly waived by the promisor.
Discuss the cases of Carlill v. CSB Co; Errington v. Errington; Lefkowitz v. Great
Minneapolis Surplus Store – what were the promises made by the promisors in these cases;
the conditions that were required to be fulfilled; the acts of the promisees that constituted
their acceptance of the proposals.
Revocation is completed when communicated to the person to whom it is addressed – s.
4(3). Revocation of proposal can be done at anytime before acceptance is complete as
against the proposer - s. 5(1) & s. 6(1) and explain. Byrne v. Van Tienhoven; Henthorn v.
Fraser.
In unilateral contracts, the proposer cannot revoke his proposal once it has been accepted.
The acceptor however needs to complete performance of the conditions of the proposal to
be entitled to claim the reward or promise of the promisor.

Application of the law

The advertisement placed by B clearly evinces an intention by B to be bound by its terms
when accepted. There is a certain and definite willingness to be bound - clear and
unequivocal words were used to demonstrate this willingness to be bound. It is clear,
definite, and explicit, and leaves nothing open for negotiation
Here we have a promise by B to pay RM5,000 in return for the completion of an act i.e.
being the first person to climb and reach the summit of Mount Kampar. SL has fulfilled
the conditions as stated in the advertisement being the first person to climb and reach the
summit of the mountain. He has accepted and completed the race as directed.
He is not required to communicate acceptance because in unilateral contracts, the proposer,
B has impliedly waived or dispensed with the need for acceptance to be communicated to
him. His performance or act is sufficient consideration provided in return for B’s promise
to pay RM5,000.
The revocation by B was communicated to SL after acceptance. It is therefore invalid.
There exists a valid and enforceable contract between them.

Concluding advice
SL is advised that the advertisement inserted by Bakar constitutes a proposal and not an
ITT and there exist a valid contract between him and B. He can successfully enforce B’s
promise to pay RM 5,000.
He is further advised that B is not entitled to revoke his proposal once SL had accepted it.
However, SL would not be entitled to claim the reward until he had completed performance
of the required act i.e. he must have been the first to reach the summit of the mountain.