Offer

The first element in a valid contract would be offer. An offer or a promise or an agreement needs
to be in contract because if there is no offer than there will be no contract. In the Contracts Act,
1950, the first elements in a contract would be offer. It is one of the elements to make sure that the
contract is legally valid or acceptable. In a contract, it is very important that a party would make
an offer. There is a difference of offer between an advertisement and an option. To make an offer,
there should be at least two parties or even more so that it would be legally capable of entering
into a contract. If the offer is accepted than it would constitutes to a legally valid contract. When
an offer is being made, the other party or person would know what is being offer and what the
person or party who made the offer expect to have in return. It is the same when anybody goes on
a holiday, stays at a hotel and so on. For example, a family has made an arrangement with a tour
agency to have a holiday at Hong Kong for a few days. The tour agency would make a contract by
making forms to the family which would have to be filling up. The family member who fills up
the form would have to be clear with the rules and regulations given by the tour agency company.
Once it is fills up, the contract has been made between the family and the tour agency.

Acceptance 1.1.2
After having an offer in the contract, there should be acceptance. For a contract to be made there
should be acceptance from the other party or person. When the other party is clear with the offer,
there would make an acceptance once they are clear with the rules and regulations being offer in
the contract. There will be no contract if the parties are still negotiating or discussing and have not
made accept the offer. The person or party can accept the offer being made in writing or orally
which is made verbally or being spoken out. For example, a tourist writes to hotel K requesting
information about the cost and availability of accommodation for the week commencing on the
15th April 2011. The staff at hotel K answers the inquiry states that the accommodation available
for that week would cost RM 600 and if the tourist responds with the deposit of RM 100 within a
week, then the room will be allocated to him. If the tourist accepts the offer, then the contract has
been made for the tourist and hotel K.
1.1.3 Consideration
Consideration is also a very important element in the contract. Consideration in a contract would
mean the other person would be giving back something in return. It would be consider as an
exchange which would be made between the promisee and promissor. There should be
consideration in a contract so that it would be legally valid. For example, a customer in a fast food
restaurant like McDonalds orders a set lunch which costs RM7.95. By ordering the set lunch, the
customer is agreeing to pay RM7.95 as consideration. However, consideration does not give any
threats to on ' line holiday contracts. Holiday services which are being provided by the on ' line
holiday providers and also the consideration by giving something back in return which would be
the payment money or even the payment made by the holiday makers would eventually follow the
requirements for consideration of a contract.
1.1.4 Intention to Create Legal Relations

It is essential to have this element in a contract. It is a necessity of the intention to create legal
relations although the Contracts Act 1950 is silent on the intention to create legal relations as one
of the requirements of a valid contract. This element would have an agreement which is not a
contract in the strict sense unless it is the common intention of the parties that it should be legally
enforceable. If there is no intention to create legal relations in a contract, the contract could be
subject to a lawsuit. For example, when there is a contract or an agreement made between the
parent and the children. If the parent passes away, the children would have whatever property or
possession which is left by the parent.
1.1.5 Certainty
Another main element in a contract would be certainty. The terms and regulations being made in a
contract should be stated clearly and understood by the parties of the contract. If the agreement is
not certain, it would be no longer valid. For example, if the guest wants to stay in a hotel, , the
guest needs to inform how many days he or she is staying at the hotel, the type of room, and also
the date when he or she are going stay and the number of days he or she is staying.
1.1.6 Capacity
Capacity in a contract is the parties to the contract must have the legal capacity to do so. 18 years
old is stated as the age of a major. Minors who are people below the age of eighteen have no
capacity to enter into contracts. Therefore, insane people or people with unsound minds also
cannot enter into any valid contracts. For example, a person who is at the age of sixteen years old
could not stay at a hotel. The hotel staff would not allow having the person who is sixteen years
old to stay at the hotel since that person is not eighteen years old or above. For the person to stay
at the hotel, he or she must have a guardian who is above eighteen years old or a parent to
accompany him or her to stay in the hotel.

Consideration
Consideration is an essential element for the formation of a contract. It may consist of a promise to
perform a desired act or a promise to refrain from doing an act that one is legally entitled to do. In
a bilateral contract consideration is an agreement by which both parties exchange mutual promise
that each promise is regarded as sufficient consideration for the other. In a unilateral contract, an
agreement by which one party makes a promise in exchange for the other's performance, the
performance is consideration for the promise, while the promise is consideration for the
performance.
Under common law, there can be no binding contract without consideration, which was defined in
an 1875 English decision as "some right, interest, profit or benefit accruing to the one party, or
some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other".
Consideration is simply something of value received by a promisor from a promisee. It can take
the form of a right, interest or benefit accruing to one party, or some forbearance, detriment, loss,
or responsibility, given, suffered or undertaken by the other .
Consideration is not required in contracts made in civil law systems and many common law states
have adopted laws which remove consideration as a prerequisite of a valid contract.

Consideration maybe executory where a promise is given for a promise or it may be executed
where an act or forbearance is given for a promise. For example, if the customer pays upon
booking or ordering, it called executed consideration. If the customers pays the contract price at a
little date agreed by both parties it is called executor consideration. Consideration must be provide
( given) by the offeree (promisee) but need not moved to the promisor. Where the act put forward
by a party to a contract as consideration has perform before any promise of payment was made by
the other promise that can be regarded as past consideration and its effect no consideration at all.
Although consideration is essential for the formation of a contract the doctrim of promissory
equitable esstopped seems to allow a possible exception. At English common law, if party A owe
person B, RM10 and wish discharge his death by paying B RM9. A must obtained the agreement
of B and A must provide B with some consideration for giving up his right to the full payment of
RM10. (unless the release is under seal). Therefore, the payment of the lesser sum is satisfaction
of a greater sum on the day the dept is due is not considered as satisfaction of the whole sum. This
is the rule from Pinnels case that was reaffirmed in the case of Fookes & Beer (1884).

different type of contract : 1-unilateral :

Unilateral

:1.2

contract is a contract in which one of the party (offeror) demands performance from the other
party (offeree), instead of a promise. Since the offeree makes no promise, he can not be sued for
abandoning or failing to carry out his act; only the offeror is bound by the law and, therefore, this
.is a single-sided contract
Example: Richard (offeror) offers a reward of 200 for the safe return of his lost cat. The offeree
has made no promises, so he is not obliged to return Richards lost cat, but if he does, then Richard
.will have to pay 200 to the offeree

Implied-In-Law Contract: This is also known as a Quasi-Contract. It isnt -2

actually a contract; rather, it is a way for the courts to rectify situations in which one party would
.be unfairly enriched, were they not obliged to compensate the other party
Example: At the scene of an accident, a doctor treats an unconscious patient who has not agreed to
pay the doctor for the emergency services. The patient was not required to pay the doctor for his
services; and therefore, the patient would be unfairly enriched by the doctors services

bilateral contract-3

A bilateral contract is formed when the two parties

exchange promise to perform someact in the future. This
is also called two sided contract because it is an
exchange

of p r o m i s e w h e r e b y b o t h p a r t i e s b i n d t h e m s e l v e s
t o u n d e r t a ke s o m e f u t u r e a c t i o n . Example of this
contract includes; Jennifer offers to sell his phone to Jessica
if he willpay her $100. Jessica accepts the off er.
Another example is Fatma off ers to sing atHazims
nightclub next Friday, Saturday, and Sunday if he will
pay her $ 5,000 pernight. He agrees. In these two
examples both parties are obligating themselves to
takesome action in the future. As soon as both of them
accept the off er then it is a validcontr act. If for
instances one party fails to meet the future deman ds
then the otherparty then the other party has a right to sue
.him for the damages

Unbilateral contract :As was seen in the bilateral

contract that both parties exchange promise to each
otherwhile in unilateral contract, one party makes the
promise to the other party that canonly be accepted
by the others performance. This is diff erent from
bilateral where itcomes about when one gives a promise
but in unilateral it begins with the performanceo f t h e
requested act. Example includes;
K e r i p r o m i s e s t o p ay $ 5 0 0 i f A s h l e y w i l l decorate
Harriet house. Ashley goes over to Harriets house and
begins decorating it.She has accepted Keris unilateral
promise by undertaking the desired task. In
thisexample it shows the offeree (the person to whom the
offer is made) is not obligated todo anything but only the
offeror is obligated to do some act

4-Simple Contract.A

simple contract is any

oral or written agreement that is not required to
f o l l o w a specific form or to be signed, witnessed or
sealed. Most of the contracts entered into bybusinesses
and private individuals are simple contracts even
though some may seemrather complex and go on for many
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