UNIVERSITY TECHNOLOGY OF MARA

FACULTY OF CHEMICAL ENGINEERING

BUSINESS LAW
(LAW 299)

TUTORIAL 2

Students Name:

AHMAD ISMI ZULFADLI BIN ISHAK (2013642178)

NORSURIANI BINTI ISMAIL (2013868906)

NUR ATHIRAH NAJWA BINTI MOHD SHUKRI (2013264598)

NUR FARAH YUMNI BINTI MOHD NASIR (2013298498)

Group:

EH 220 8C

Date submitted:

25TH APRIL 2017

Lecturers Name:

MR MUIZ RAZAK
(1) ISSUE

Based on Lela and Daniel case, it can be said that it is an offer instead of ITT
since Daniel is accepted the contract not accepted the offer. When one person
signifies to another his willingness to do or to abstain from doing anything with a view
to obtaining the assent of that other such act or abstinence, he is said to make a
proposal. From this case, a proposal can be accepted if only the proposal is
communicated to the acceptor and the person who accepted the contract is
knowledge about the offer or in other words it can be said that the Daniel is already
know about the offer that Lela had given in local newspaper that whoever finds
Amirul and return him back to Lela, she would give that person RM 10,000 as a
reward. Hence, Daniel is entitled to the reward due to the offer is in his mind before
he sent Amirul back to Lela. Besides, from the Lelas side, the offer is valid since
Daniel knows about the offer early before he had found the Amirul. The offer is said
to invalid if the offer is not in Daniel minds at all after he returned Amirul to Lela.

(2) LAW

Lela and Daniel case refers to the law of contract and the surrounding issues
relating to the offer and acceptance. Section 2(a) of the Contract Act 1950 states that
proposal is made when one signifies to another his willingness to do or to abstain
from the doing anything, with a view to obtaining the assent of the other to such act
or abstinence. Section 2(b) of Contract Act 1950 states that when the person to
whom the proposal signifies his assent thereto, the proposal is said to be accepted.
The legal recognition of an agreement, in the area of contract law, is only given
where a contract can be said to have been established between the parties to an
agreement. In other word, a proposal or offer which is something that capable of
being converted into an agreement by its acceptance. In Section 2(c) of Contract Act
1950, the person making the offer is called a promisor or offeror meanwhile the
person accepting the offer is called a promisee. The promisor must have declared
his readiness to undertake an obligation upon certain terms, leaving the option of its
acceptance or refusal to the promise. The advertisement which was placed by Lela
on the local newspaper is capable of being construed as an offer (Carlill v Carbolic
Smoke Ball Co [1893] 1 QB), which is binding on Lela. The acceptance of this offer
made by Lela, in the form of returning Lelas son, Amirul is a valid acceptance, but
only if the conditions set out by Lela is met.

The Section 4 (1) states that the communication of offer is complete when it
comes to the knowledge of the person to whom it is made. A proposal is said to have
been communicated only if the party who accepts it knew about the proposal. If a
party accepting the proposal is not aware about the proposal, then there is no
contract. In case of R v Clarke [1940] 40 CLR 227, the Australian Government
offered a reward for information regarding murder of police officers. When X and
Clarke were arrested later, Clarke gave information to the police which lead to the
arrest of Y. Clarke was released for not guilty, after that he found out about the
reward and he claimed. The claim was failed as when Clarke gave the information to
the police, he did not have the knowledge that there was a reward for giving
information. Ignorance of offer is similar to never hearing it or forgetting the offer
hearing it.

Meanwhile, in case of Carlill v Carblic Smoke Ball Co Ltd [1893] 1 QB, the
defendant advertised that they would offer to offer to pay $1000 to anyone who still
suffer from influenza after using their medicine. The offer was made to the general
public. So when plaintiff used the medicine and still caught influenza, plaintiff was
entitled to the $1000 as promised.

(3) APPLICATION

According to section 2 (a) of the Contracts Act, Lela has made an offer
instead of the invitation to treat (ITT) as she signifies to the public her willingness to
give to whoever that finds her missing son, Amirul RM 10 000 as a reward. It means
that the proposal is already exist, different from ITT that only happens whenever
someone actually inviting you to make the proposal. The offer can be void if the offer
is lacking such as in the case of Affin Credit (Msia) v Yap Yuen Fui. But, as for Lelas
proposal, it is valid as the proposal obeys the section 2 (a) of the Contracts Act.
Next, according to section 2 (c), Lela is a promisor as she is the one who making the
offer and Daniel as the promisee because he is the one who accept the offer. In this
case, Lela offering the reward to the general public whenever she advertised in the
local newspaper about the reward. This is quite similar with the case of Carlill v
Carblic Smoke Ball Co Ltd (1893) 1 QB, that the offer is made to the general public.

Next, Daniel who had read the newspaper and seen the advertisement about
the reward that Lela offering has found Lelas son and returns him to Lela. From this
situation, we can say that the proposal has been communicated as Daniel who
accepts it knew about the proposal. This obeys the section 4 (1) as the
communication of offer is complete when it comes to the knowledge of the person to
whom it is made. This step is important as a proposal must be communicated to the
acceptor (Daniel) before it can be accepted. The contact is not valid if Daniel is not
aware about the proposal such in the case R v Clarke (1940) 40 CLR 227. In that
case, Clarke who gave the information to the police regarding murder of police
officers, resulting in the arrest of Y, does not know about the reward at that time.
Thus, he failed to claim the reward.

Besides that, the acceptance has its own rule. The acceptance of a proposal
must be communicated to the promisor in order to create a binding contract between
parties. Daniel accepts the proposer whenever he returns Amirul to Lela,
acknowledged about the reward. Once proposal is accepted, it becomes a promise.
This obeys the section 2 (b) of the Contract Act. The acceptance is only effective
when it has been communicated either via mouth, letters, telex, facsimile or by
recorded message. The acceptance for case Lela and Daniel is valid as Daniel
accepts the exact proposal by Lela without any modification or variation. As they are
not negotiating, the agreement is already formed hence it obeys the section 7 (a).
The proposal can be invalid if Lela and Daniel are still negotiating such in the case of
Lau Bros v China Pacific Navigation Ltd (1965). In the case, no contract exists but
only negotiation. The acceptance can be not absolute if Daniel introduces a new
term of offer meaning he is making a counter offer. The counter offer can destroy the
original offer. As an additional, Daniel who found Amirul returns him to Lela in three
days. Thus, the acceptance is valid according to the section 6 (b) that states that an
acceptance must be made within a reasonable time.
(4) CONCLUSION

So, offer made by Lela is valid based on Contract Act 1950, Section 2(a), whereby
Lela made an offer to general public, then Amirul accepted the offer based on
Section 2(b) and Section 2(c) whereby the promise or Lela has to reward Amirul as
he already met the requirement by returning Lelas son. Section 4(1) also indicate
that the offer is valid as the offer is already in the mind of the acceptor or Amirul. The
communication is complete. Therefore, Lela need to pay RM 10 000 to Amirul as a
reward of returning her Son.