LAW OF CONTRACTS

(OFFER AND ACCEPTANCE)

OUR GROUP

Fisher bell bell

Fatin Nur Aliah Mohd Shahzihan

(1722658)

Fithriyaani Hafzhan Mohd Shaari

(1724014)

Maizatul Akma Mahat

(1723650)

Quote of the day

Work hard in silence. Let your success be your noise.

QUESTION NO 2 (a)

a) State the circumstances in which a proposal will be terminated with references to the
Contract Acts 1950 and decided cases
TERMS OF TERMINATION
Can be divided into 2:
a) Section 5(1), Contract Acts 1950
"A proposal may be revoked at any time before the communication of its acceptance
is complete as against the proposer but not afterwards."
b) Section 5(2), Contract Acts 1950
"An acceptance may be revoked at any time before the communication of its
acceptance is complete as against the proposer but not afterwards."

CIRCUMSTANCES OF TERMINATION
Section 6(a)

By the communication of notice of revocation by the proposer to the party.

A) Defined

offer is made by sending the offer notice by telegram or postage

the acceptance is succeed when only the offeree accepts the notice.

- Example: i) Byrne v Van Tienhoven (1880) 5 CPD 334

Section 6(b)

by the lapse of the time prescribed in the proposal for its acceptance, or, if no time is so
prescribed, by the time lapse of a reasonable time, without communication of the
acceptance;

Defined:

that the proposal may be terminated due to expiration of time prescribed in the proposal

no time is prescribed by the lapse of reasonable time

Example: i) Ramsgate Victoria Hotel Co Ltd v Monteflore (1866) LR 1 Ex 109

Section 6(c)
by the failure of the acceptor to fulfil a condition precedent to acceptance

Defined:

this happens when the acceptor fails to fulfil the condition precedent to acceptance.

Example: i) Finncing Ltd V Simson (1962) 1WLR 1184

Section 6(d)
by the death or mental disorder of the proposer, if the fact of his death or mental disorder
comes to the knowledge of the acceptor before acceptance.

Defined:

it happens when the proposer died or became mentally disordered subsequent to the
communication of proposal.

Example: i) Re Whelan (1897) 11 R 575

Question 2 (b)(i)

Is there a binding agreement in the following case?

CASE 1:

Ali and Baba conclude a verbal agreement for the sale of a house subject to a contract to be
drawn up by their solicitors and signed by both parties

STEP 1: Identify the issues

Is the verbal agreement made between Ali and Baba considered as legally binding?

STEP 2: State the law

> Section 9 of CA 1950: Promises, express and implied.

" So far the proposal or acceptance of any promise is made in words, the promise is said to
be express. So far as the proposal or acceptance is made otherwise than in words, the
promise is said to be implied. "

>DIAMOND PEAK SDN BHD & ANOR v DR TWEEDIE

"As said by Gunn Chit Tuan J in Diamond Peak Sdn Bhd v. Dr Tweedie, under our law, as in
most Commonwealth Countries, an oral contract for the sale of immovable property is valid
and enforceable."

STEP 3: Application of the law

According to Section 9 of CA 1950 and decided case, the oral agreement made by both
parties is considered as a binding agreement.
In other words, the form of a proposal can be made in word (express), oral (implied),
conduct (implied) and combination of all above.

STEP 4: conclusion
An orally concluded agreement is just as binding as a written one and can be enforced in
court as well. The main difference is, though, that when the contract parties are in dispute, it
can be difficult to provide evidence of the content or even the existence of an oral
agreement. Hence, it is always better to put things in a contract and have both parties sign
it. In some cases, the law requires that an agreement is laid down in a written document, a
purchase contract regarding a house being one of them.
Question 2 (b)(ii)

Is there a binding agreement in the following case?

CASE 2: Dollah agrees to buy Comel's car subject Dollah's wife agreeing to the sale

STEP 1: Identify the issues

Whether there is a binding agreement between Dollah and Comel

STEP 2: State the law

Section 8 of CA 1950: Acceptance by performing conditions, or receiving consideration

Section 6(c) of CA 1950: By the failure of the acceptor to fulfil a condition precedent to
acceptance

Section 7(a) of CA 1950: In order to convert a proposal into a promise, the acceptance must
be absolute and unqualified

Vantage Systems v Priolo Corporation

The court found that when the tenant accepted the revised proposal, the parties intended to
be barned immediately by an agreement

STEP 3: Application of the law

The proposal made by Dollah to buy Comel's car will only be accepted through condition as
referred to Section 8 of CA 1950. The condition is that Dollah's wife agreed to sale.

If Dollah failed to fulfil the condition, the contract will be null and void which falls under
Section 6(c) of CA 1950.

According to Section 7(c) of CA 1950, the agreement between Dollah and Comel must not
have any doubt and confusion and both parties must have the right knowledge about the
agreement.

STEP 4: conclusion
A conditional agreement is also considered as a form of contract.
The agreement between Dollah and Comel will be binding between them only when Dollah's
wife agree with the agreement
Dollah's wife is the main character in this situation where she is the authority and the
executive power.