MULTIMEDIA oO) UNIVERSITY STUDENT ID NO MULTIMEDIA UNIVERSITY FINAL EXAMINATION TRIMESTER 1, 2013/2014 UNL 1612 - CONTRACT LAWI {All Sections/Groups) 24” SEPTEMBER 2013 Reading Time: 9.00 a.m.-9.15 am. (15 Minutes) Answering Time : 9.15 am.—12.15p.n. (3 Hours) INSTRUCTIONS TO STUDENT BED Students will have fifteen minutes during which they may read the paper and make rough notes. ONLY in their question paper. Students then have the remaining THREE HOURS in which to answer the question. This Question paper consists of 5 Pages and 5 Questions only. Answer FOUR (4) Questions Only. Students are allowed to bring into the examination hall CLEAN and ORIGINAL copies of: i Contracts Act 1950 (Act 136) ii. Specific Relief Act 1950 (Act 137) iii, Civil Law Act 1956 (Act 67) Please write all your answers in the Answer Booklet provided.uti CONTRACT LAW _28° SEPTEMBER 2013, QUESTION 1 fa) (b) A contract, negotiated by telephone, telex or other forms of instantaneous communication, is not complete until the acceptance is actually received by the proposer, Discuss with reference to the Contracts Act 1950 and decided cases. (15 Marks) Sally wanted to sell her Exora, and put an advertisement in the The Star on Ist March 2012, which read: “Exora for sale, good condition, new tyres with sport rim, Best offer secures.” Sally included her phone number and e-mail address in the advertisement. Jane called Sally on the same day and asked her to quote lowest price. Sally answered: “RM15,000/-.” Jane wanted to think further and put down the phone. On the same day, Anne tried calling Sally but the line was busy. She e- mailed Sally, offering to buy the car for RM16,000/-. In the morning of 2nd March 2012, Jane called Sally again but could not speak to her, and upon being asked to leave a message by the answering machine, she said: “I'm buying the car for RM15,000/-.” Sally viewed her e-mail message on 2 March 2012, and saw the message by Anne. Sally replied the e-mail by saying that she accepted the offer of RM 16,000/-. Then Sally listened to her voice messages and heard Jane's message, Sally secks your advice regarding both communications with Jane and Anne, and whether she is bound by any contract with the two persons. Advise Sally on the relevant principles of contract law, with adequate support from statutory provisions and case law (10 Marks) (Total: 25 Marks) Continued... ‘warinwa pau TofSUNL 1612 CONTRACT LAW | 2 SEPTEMBI 2013 QUESTION 2 (a) “A basic rule in the law of contract is that only those who are parties to the contract can sue and be sued on Explain the above statement in relation to the law on privity of contract in Malaysia and England. (15 Marks) (b) In June 2010, Kamal borrowed RM15,000/- from Tan repayable (without interest) on demand. In June 2011, Kamal sent a cheque of RM5,000/- as part payment of the debt. In November 2011, Tan wrote a letter to Kamal demanding that he has to settle the balance of the debt. Kamal then wrote to Tan, enclosing a cheque for RM1,000/- stating “Enclosed herewith is my cheque for RM1000/- in full settlement of the debt.” In December 2011, Tan sent a letter to Kamal asking him to settle the whole payment before February 2012; otherwise he will proceed with legal action. Knowing this, Muthi, the son of Kamal negotiated with Tan. They then reached an agreement that Tan will accept RM2,000/- from Muthi as a full and final satisfaction of the debt. Discuss whether the whole debt is discharged under the Contracts Act 1950. Support your answer with reference to the relevant statutory provisions and case laws. (10 Marks) (Total: 25 Marks) MIAHLIMMA page 20fUN 1612 CONTRACT IAW 284 SEPTEMBER 2013 @ (b) Intention to create legal relations has been accepted as a requirement for the offer to be legally accepted so as to bind the parties into an enforceable contract. However it is not easy to determine the element of intention in all cases by using the common yardstick, Explain in the light of judicial decisions with special reference to social and domestic agreements. (15 Marks) The Multipurpose College granted John, aged 16, a scholarship for a diploma in automotive engineering at its Automotive School (AS). As per the conditions in the scholarship agreement John had to serve the college as a trainer for five years after the completion of the training course. Prior to his joining the AS, John met Mary and promised to marry her. Upon completion of the training course, John decided not to serve the college as a trainer. He also refused to marry Mary. Advise John on his legal liabi es arising from the above facts. (10 Marks) (Total: 25 Marks) Continued... MIAWIMA page 3 of 5UNL 1612 CONTRACT LAW! 248 SEPTEMBER 2013, QUESTION 4 (a) (b) ‘No consideration is required in case of agreements made on account of natural love and affection. Nevertheless, there are certain requirements, which need to be strictly complied with before such agreements stand the test of validity in law Explain with the help of statutory provisions and the decided cases. (15 Marks) Peter, the owner of a land measuring 500 acres at Sungai Buloh, made an offer to sell it to Star Developers Sdn. Bhd, (SD) for RM10 million, 10% payable on the signing of the Sale & Purchase Agreement (SPA) and the balance on registration of the transfer, to be done within one week. The offer was made on 20th December 2011, valid for ten days. SD was interested to buy the land as it was a profitable investment but was suffering from shortage of funds. On 27th December, SD sent a fax asking Peter whether it was possible for them to pay 50% of the balance price on registration and the remaining balance within one month thereafter. Peter treating the inquiry as a rejection of the offer sold the land to Eskay Developers Sdn. Bhd. (ED) for a price of RM11 million. Not hearing from Peter, SD sent a fax to him on the moming of 30th December 2011 accepting the original offer and requesting him to prepare the SPA. In reply, Peter informed SD on Ist March 2012 that the land had already been sold to ED for RMI1 million. SD is proposing to file a claim against him for the loss of RMI million suffered due to what SD claims is a breach of promise by Peter. Advise Peter. (10 Marks) (Total: 25 Marks) Continued... MIAHIMA page 4 of 5UNL 612 CONTRACTLAWI oa 248 SEPTEMBER 2013 QUESTION 5 (a) Explain the doctrine of promissory estoppel. Are there any limitations for the application of this doctrine? (15 Marks) (b) Ali, a medical practitioner, has been renting an office space on the second floor of a building belonging to Camel. The monthly rent for the room is RMSO0/- and the contract of lease is for a period of five years. Camel encourages Ali to improve his clinic and also tells him that as long as he pays the rent regularly and so long as he carries on his medical profession, he will not ask Ali to leave. In reliance on the assurance given by Camel, Ali buys an electro- cardiogram and an X-Ray machine for use at his clinic. A few months later when Ali’s practice improves and his income increases, Camel increases the rental fee by RM200/-. Ali refused to pay the new rental other than what was stipulated under the contract. Camel serves a notice upon Ali to quit. Ali files a suit praying for an injunction to restrain Camel from serving him the notice to quit. Advise Ali. (10 Marks) (Total: 25 Marks) End of Page MIAWIMA