WARISAN AKADEMI PENDIDIKAN

Assignment Cover Sheet

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PROGRAMME : EXECUTIVE BACHELOR’S IN BUSINES MANAGEMENT

STUDENT INTAKE : APRIL 2022

MODULE : BUSINESS LAW FOR EXEC BACHELOR (GROUP 5)

DUE DATE : 14-02-2024

DATE CLASSED : 13-02-2024 & 14-02-2024

DATE SUBMITTED : 21-01-2024

FACILITATORS NAME : MISS PADMALOSHINI

STUDENT NAME : NUR AINI BINTI ABD RAZAK

STUDENT NUMBER : WBPN22284

IC/NO : 930812-01-6106

CENTRE : WARISAN AKADEMI PENDIDIKAN (IPOH)

QUESTION MARK
1
2
3
4

TOTAL

FINAL MARKS
 Index

Question 1 : Page 1 - 1

Question 2 : Page 2 – 3

Question 3 : Page 4 – 4

Question 4 : Page 5 – 6

Reference : Page I - II
Question 1: Legal Status of an Advertisement made by Jessie

A contract is an agreement made by two or more parties that enforceable by law. In

order for a contract to be enforceable by law, there must be an intention to create legal relations

and it must fulfil three important elements which there must be an offer, an acceptance has been

made and there is a consideration involve.

In my opinion, the legal status of the advertisement made by Jessie is not a valid and

enforceable contract. This is because the advertisement is only an invitation to treat and not an

offer. In the case of Partridge v Crittenden, it was held by the court that an advertisement is

usually an invitation to treat and not a valid contract. It was only invitations to make an offer

and a starting point of negotiations with anyone reading it and responding to it.

To apply this case, on 1st March 2018, Jessie advertised in the newspaper that she needs

someone to do the interior designer for her new house. This advertisement is merely an

invitation to offer and a starting point of negotiations to anyone who reading it. Thus, in my

opinion the advertisement made by Jessie is only an invitation to treat and not a valid contract.

Example: Invitation to treat

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Question 2: How many offers involved in this case?

An offer is a promise to do something or not to do something. Section 2 (a) of Contracts

Act 1950 defines that offers is when a person signifies to another his willingness to do or abstain

from doing anything.

An offer is made when one party makes it clear either by words or by actions that he is

prepared to be bound as soon as the offer is accepted by the person to whom it is made. Only

when the offer is accepted, the contract is formed.

In addition to being accepted, an offer may be rejected or a counter offer may be made.

Hence, in my opinion, there were two offers made in this case but there was only one

acceptance being made.

The first offer has been made by Victor on 3rd March 2018 by his letter to Jessie stating

his willingness to do the interior design for her new house as being advertised in the local

newspaper. This is a clear offer as Victor also attached to the Letter his terms which are

important to the job. The attachments of terms by Victor in his letter to Jessie is a clear action

that he was prepared to be bound as soon as the offer is accepted by Jessie.

The second offer was made by Jessie by letter dated 5th March 2018 stated that she

agreed with all terms mentioned by Victor except the price. She replied in the letter dated 5th

March 2018 that she can only afford to pay RM40, 000.00 and Victor must reply to her letter

via post. This was a clear action of a counter offer by Jessie.

A counter offer is an offer made in response to a previous offer by the other party during

negotiations. Making a counter offer automatically rejects the previous offer and requires

acceptance under the terms stated in the counter offer.

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 In the case of Hyde v Wrench, Wrench offered to sell an estate of 1000 pounds and

Hyde replied that he can only pay 950 pounds for purchase. Court decided in this case that the

response made by Hyde was a counter offer.

Thus, the letter dated 5th March 2018 by Jessie to Victor was a clear action of counter

offer as being decided by court in the case of Hyde v Wrench and this counter offer has revoked

the first offer made by Victor on 3rd March 2018.

Example: Hyde vs Wrench

Example: Counter offer

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Question 3: When was the contract formed?

A counter offer is other form of rejection of offer. The offeree introduces a new offer to

offeror and the counter offer revokes the original offer which is no longer being accepted. After

making a counter offer, original offeree becomes offeror and the original offeree becomes

offeror.

In this case, Jessie by her letter dated 5th March 2018 stating that she agreed with other

terms except that she only affords to pay RM40,000.00. This action known as a counter offer

as being held in the case of Hyde v Wrench. This counter offer has revoked the offer made by

Victor and Jessie has become the offeror.

The acceptance has been made completely by Victor when he posted the Letter of Reply

on 7th March 2018 as requested by Jessie in her Letter of Offer.

Section 2 (b) of Contract Act 1950 provides that when the person to whom the proposal

is made signifies his assent thereto, the proposal is said to have been accepted. The acceptance

has been made completely by Victor when he posted the Letter of Reply on 7thMarch 2018 as

requested by Jessie in her Letter of Offer.

Section 4 (2) (a) of Contract Act 1950 stated that communication of an acceptance is

complete when it is put in a course of transmission.

Under the postal rule decided by court in the case of Adams v Lindsell, if there is a

condition that the acceptance must be made by post, the acceptance of an offer is complete as

it is posted.

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Question 4: When can Jessie revoke the offer if she is no more interested to do the interior

design for her house?

Revocations mean an offer is withdrawn by the offeror. Section 5 (1) of the Contracts

Act 1950 stated that an offer may be revoked at any time before the communication of its

acceptance is complete but not afterward. The general rule was established in Payne v Cave

that an offer can be revoked at any time before the acceptance takes place. However, the

revocation must be directly or indirectly communicated to the offeree before acceptance is

complete.

In this case, the acceptance was made completely by Victor through postage of the

Letter of Reply stating that he agreed with the counteroffer made by Jessie which is the price

of RM40, 000.00. Therefore, Jessie can only revoke the offer before Victor sends the Letter of

Reply to her by post.

In Errington v Errington Woods, a father-in-law purchased a house for his son and

daughter-in-law to live in. The house was put in the father’s name alone. He paid the deposit

as a wedding gift and promised the couple that if they paid the mortgage instalments, he will

transfer the house to them. The father then became ill and died. The mother inherited the house.

The daughter-in-law continued to pay the mortgage instalments but refuse to stay in the house

with the mother. The mother brought an action to remove the daughter-in-law from the house.

It was then held by the court that the daughter-in-law was entitled to the house. The father had

made the couple a unilateral offer. The daughter-in-law was in course of performing the

acceptance by continuing to meet the mortgage payments. It was also decided by the court that

under contract principles an offer may be revoked at any time before acceptance takes place.

Lord Denning held that once acceptance has been completed, the mother cannot revoke the

offer made.

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 In the case of Byrne & Co v Van Tien Hoven & Co, Van Tien Hoven sent Byrne a letter

in which he offered to sell him some tinplate. He quickly had a change of heart and sent a

second letter shortly afterward that he revoked the first offer. However, Byrne had already

accepted the offer. The courts ruled that the revocation was not effective because it had not

been communicated directly to Byrne. If Van Tien Hoven had communicated his revocation to

Byrne before he had accepted the offer, it might have been valid.

In conclusion, as mentioned in this case, Jessie sent the Letter of Offer on 5th March

2018 and Victor received the Letter of Offer on 7th March 2018. He then replied to the letter

and posted the Letter of Reply on the same evening he received the letter from Jessie. Thus, if

she is no more interested to do the interior design for her new house, Jessie can only revoke

the offer starting from 5th March 2018 until 7th March 2018 before Victor posted the Letter of

Reply to her which is before the acceptance is complete. The revocation must be communicated

to Victor for it to be valid. In this case, Jessie did not send any revocation notice to Victor

before acceptance was completed, therefore Jessie is unable to revoke the offer as the

acceptance has been completed.

Example: Errington v Errington Wood Example: Byrne & Co v Van Tien Hoven & Co

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 Reference

Translation phase: https://www.deepl.com/translator

https://www.academia.edu/19132636/SAMPLE_QUESTION_LAW_419

https://lawexplores.com/the-company-as-a-distinct-and-legal-person/

https://www.upcounsel.com/essentials-of-contract-of-sale-in-business-law#google_vignette

https://www.gannons.co.uk/insights/dissolution-of-a-partnership/

https://www.nolo.com/legal-encyclopedia/lack-capacity-to-contract-32647.html

https://sprintlaw.com.au/articles/invitation-to-treat-vs-offer/

https://carlilandcarbolic.com/contract-law/formation-of-a-contract/offers-invitations-to-treat/

https://prezi.com/tva5hm1pycx2/1603-a-law-hyde-vs-wrench/

https://www.simplekanoon.com/contract-law/hyde-v-wrench-625/

https://discover.hubpages.com/education/Adams-v-Lindsell

https://www.australiancontractlaw.info/cases/database/errington-v-errington

https://uollb.com/blog/cases/byrne-v-leon-van-tien-hoven-1880-contract-law

https://www.lawteacher.net/free-law-essays/company-law/a-company-is-a-legal-entity-

company-law-essay.php#