CONFIDENTIAL LW/SEP 2011/LAW240/231

UNIVERSITI TEKNOLOGI MARA

FINAL EXAMINATION

COURSE INTRODUCTION TO COMMERCIAL LAW /

BUSINESS LAW
COURSE CODE LAW240/231
EXAMINATION SEPTEMBER 2011
TIME 3 HOURS

INSTRUCTIONS TO CANDIDATES

This question paper consists of three (3) parts PART A (20 Questions)
PART B (7 Questions)
PARTC(1 Question)

Answer ALL questions from PART A, PART C and four (4) questions from PART B:

i) Answer PART A in the Objective Answer Sheet.

ii) Answer PART B and PART C in the Answer Booklet. Start each answer on a new
page.

Do not bring any material into the examination room unless permission is given by the
invigilator.

Please check to make sure that this examination pack consists of:

i) the Question Paper

ii) an Answer Booklet - provided by the Faculty
iii) an Objective Answer Sheet - provided by the Faculty

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO

This examination paper consists of 9 printed pages
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PART A

1. Which of the following refers to legislation?

a) Law made by the Yang Di Pertuan Agong during a period of emergency.

b) Law enacted by Parliament and State Legislative Assemblies.
c) The supreme law of the land.
d) Any proclamation, rule, regulation, order, notification, by-law or other
instrument made under any Ordinance, Enactment or other lawful authority
and having legislative effect.

2. Law made by the Sarawak State Legislative Assembly is known as:

a) an Ordinance
b) an Enactment
c) an Act
d) a Subsidiary Legislation

3. Subsidiary legislation exists because laws made by Parliament

a) are not comprehensible to the general public

b) are too general for the public to understand
c) are insufficient to govern everyday matters
d) are not transparent enough for the general public

4. An offer is effective when

a) the offer letter is posted

b) the acceptance letter is posted
c) the offeree accepts it
d) the offeree has knowledge of the offer

5. An executory consideration is

a) a promise made after the performance of an act

b) a promise made in return for the performance of an act
c) a promise made in return for the other party's promise
d) a promise made after the contract is rescinded

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6. A minor can enter into a contract for necessaries. What are "necessaries" would
depend on:

a) the minor's needs and the quality of the goods.

b) the status of the minor's parents and the price of the goods
c) the minor's needs, the nature of the goods and the minor's ability to pay
d) the nature of the goods, the minor's needs and the minor's condition in life

7. Termination of a proposal could be made by

i) Revocation of offer
ii) Counter offer
iii) Request for further information
iv) Rejection of offer

a) i, ii and iii
b) i, ii and iv
c) ii, iii and iv
d) All of the above

8. A party is deemed to be in position to dominate the will of another in the following

circumstances except

a) Where a party holds a real or apparent authority over the other

b) Where a party takes unfair advantage of the subsisting relationship between
him and the other party
c) Where a party makes a contract with a person whose mental capacity is
temporarily or permanently affected by reason of age, illness or mental or
bodily distress
d) Where a party threatens to detain any property to the prejudice of any person
with the intention of causing any person to enter into an agreement.

9. Clara agreed to sing at the Golden Moon Club for four months. She also promised
not to sing at other night clubs during that period. One month later, Clara signed a
contract to sing at the Silver Star Club every weekend. What is the most suitable
remedy which may be taken by Golden Moon Club?

a) Quantum meruit
b) Specific performance
c) Injunction
d) Ratification

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10. The following are the ways to terminate an agency by operation of law EXCEPT:

a) by bankruptcy of the principal

b) by the death of the principal or agent
c) by the insanity of the principal or agent
d) by mutual agreement between the principal and agent

11. Suppose Ady tells Putra in the presence of Putri that Ady is Putri's agent and Putri
does not contradict this statement. Putri cannot later deny that Ady is his agent if
Putra sells goods to Ady believing him to be Putri's agent and later claims for the
price. What is the type of agency created in the above situation?

a) By necessity
b) By express appointment
c) By estoppel
d) By ratification

12. The difference between a 'sale' and 'an agreement to sell' is

a) the price of the goods

b) the quantities of the goods to be supplied
c) the time when property in the goods is transferred to the buyer
d) the qualities of the goods to be supplied

13. Ahsus Sdn Bhd is a well known computer company. The company sold and delivered
35 computers on 14 days' credit to Jamal, who operated a cyber cafe. Jamal failed to
pay after the credit period ended. The company's cause of action is

a) stopping the goods in transit

b) right of lien
c) sue for damages for non acceptance
d) claim for unpaid price

14. Before the owner can repossess the hire-purchase goods from the hirer, the owner
must

a) serve a 2nd Schedule notice after 2 successive defaults of the monthly

instalments
b) serve a 4th Schedule notice after 3 successive defaults of the monthly
instalments
c) serve a 5th Schedule notice after the default of the last instalment
d) serve a 4th Schedule notice after 2 successive defaults of the monthly
instalments

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15. Which of the following statements is TRUE regarding a hire purchase agreement?

a) A hire purchase agreement must be in writing

b) A hire purchase agreement can be made orally
c) A hire purchase agreement can either be in writing or made orally
d) A hire purchase agreement is not void merely because the handwriting is not
clear and legible

16. An employer can take disciplinary action in which of the following situations?

i) When a worker fails to perform his job to the required standard

ii) When the employer needs an experience and skilled worker
iii) When a worker disobeys the rules set by the employer
iv) When the employer claims that the company was financially weak

a) ,ii and iv
b) , iii and iv
c) i and iii
d) and iii

17. An employee's sick leave entitlement, like his annual leave and other benefits,
depends on his length of service. If he has less than two years of service, he is
entitled to sick leave per year.

a) 12 days
b) 13 days
c) 14 days
d) 18 days

18. Abu indorses a cheque to Bob as a blank indorsement, but the cheque falls into the
hands of Bakar. So now Bakar is the

a) Bearer
b) Drawer
c) Indorser
d) Indorsee

19. The following are types of indorsements EXCEPT:

a) Blank Indorsement
b) Necessity Indorsement
c) Special Indorsement
d) Restrictive Indorsement

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20. One of the concepts used in Takaful is Tabarru'. What is Tabarru7

a) Agreement by a participant to share profits and losses

b) Agreement by a participant to relinquish as donation a certain proportion of
the Takaful contribution
c) Agreement by a participant to guarantee each other against a defined loss or
damage
d) Agreement by a participant to take part in the business activities of the
Takaful operator.
(30 marks)

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PARTB

QUESTION 1

Briefly explain the hierarchy and composition of the subordinate courts in Malaysia.

(10 marks)

QUESTION 2

Explain the following exceptions to the nemo dat quod non habet rule:

a) Sale by a mercantile agent

b) Sale under a voidable contract

(10 marks)

QUESTION 3

What are the characteristics of Al IjarahThumma al Bay?

(10 marks)

QUESTION 4

Adam requested Aidil to purchase some shares for Adam. Aidil bought 1000 shares from a
female holder named Aliya for RM100, 000. The shares were registered in favour of Adam.
Soon after the transaction, Adam found that Aliya is Aidil's wife and the shares were sold to
Adam at a price higher than the current market value. Adam is furious about it and seeks
your advice.

Advise Adam accordingly with reference to statutory provisions and decided case.
(10 marks)

QUESTION 5

Explain the differences between a contract of service and a contract for service.

(10 marks)

QUESTION 6

Write short notes on any two (2) of the following:

a) Bay' bithamil ajil (deferred instalment sales)

b) Bay' al-salam (immediate payment/deferred delivery)

c) Bay' al-istisna (sale on order)

(10 marks)
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QUESTION 7

Distinguish between conventional insurance and Takaful.

(10 marks)

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PARTC

QUESTION 1

a) Siew Lim was bed-ridden for two years. Before he died he told his wife to transfer all
his property to their foster child Ah Kiong without any consideration.

Discuss how the contract can be made valid based on natural love and affection.

(20 marks)

b) Explain the presumption made by the courts in domestic agreements in determining

the "intention to create legal relations".
(10 marks)

END OF QUESTION PAPER

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