CERTAINTYCERTAINTYGeneral rule: uncertainty destroys the General rule: uncertainty destroys the

agreement/contract.agreement/contract.Type of uncertainty:Type of uncertainty:

Language used Language used too vaguetoo vague – so no – so no concluded contractconcluded contract

Fail for incompleteness-Fail for incompleteness- failure to reach failure to reach agreement on a vital or fundamental term agreement on a vital or fundamental term of an agreement.of an agreement.

Karuppan Chetty v Suah Thian (1916)Karuppan Chetty v Suah Thian (1916)

- The contract was allowed one of the The contract was allowed one of the parties to rent a premise for $35 a month parties to rent a premise for $35 a month

““as long as he likes”.as long as he likes”. The contract was The contract was held void because there was no certainty held void because there was no certainty as to how long be as to how long be “as long as he likes”“as long as he likes”

LEGAL CAPACITYLEGAL CAPACITY

Gen rule: contract must be entered into by Gen rule: contract must be entered into by person who has person who has full capacity/competentfull capacity/competent to to do so.do so.

Not competent : the contract void.Not competent : the contract void.

age of majorityage of majority

sound mindsound mind

not disqualified from contracting by not disqualified from contracting by

any law to which he is subject.any law to which he is subject.

Minor…………………….Minor…………………….DefDef: do not reach the age of majority : do not reach the age of majority

(below 18)(below 18)

Gen ruleGen rule: All contract entered by minor are : All contract entered by minor are void, bcoz to protect the minor. void, bcoz to protect the minor.

Tan Hee Juan v The Boon Keat(1934)Tan Hee Juan v The Boon Keat(1934) The Pf (infant) executed transfers of land in favor of The Pf (infant) executed transfers of land in favor of

the Df. Then the Pf applied to the court for an order to the Df. Then the Pf applied to the court for an order to set aside the transfer. The court held that the transfer set aside the transfer. The court held that the transfer is void & order the restoration of property to minor.is void & order the restoration of property to minor.

Void contracts entered by a minorVoid contracts entered by a minor

AgencyA minor cannot

be an agent

LandA minor cannot be registered

as transferee, chargee or registered holder

of a lease.

Exceptions……Exceptions……

1.1. The capacity of any person to act in matters The capacity of any person to act in matters relating to marriage, divorce, dower and adoption.relating to marriage, divorce, dower and adoption.

- A promise of marriage entered into by minors or their A promise of marriage entered into by minors or their parents on their behalf is valid.parents on their behalf is valid.

- Rajeswary v Balakrishnan(1958)Rajeswary v Balakrishnan(1958) Both parties were Ceylonese Hindus. After the marriage Both parties were Ceylonese Hindus. After the marriage

ceremony, 1ceremony, 1stst df send letter to 2 df send letter to 2ndnd pf (father of 1 pf (father of 1stst pf) repudiated pf) repudiated the promise of marriage to the 1the promise of marriage to the 1stst pf bcoz she (1 pf bcoz she (1stst pf being a pf being a minor) so incapacity to enter into the contract of marriage. Court minor) so incapacity to enter into the contract of marriage. Court held that the age of majority for entering into a marriage contract held that the age of majority for entering into a marriage contract is different from other contracts entered into by a minor. is different from other contracts entered into by a minor. Therefore marriage contracts were not affected by the general Therefore marriage contracts were not affected by the general rule of minor (capacity).rule of minor (capacity).

2. Religion and religious rites and usage of 2. Religion and religious rites and usage of any class of person within Malaysia.any class of person within Malaysia.

3.Any other written law fixing the age of 3.Any other written law fixing the age of majority.majority.

-eg: AOM for workers who want to join a -eg: AOM for workers who want to join a trade union is 16 yrs old.trade union is 16 yrs old.

4. Necessities4. Necessities-minor is liable in contract for necessaries-minor is liable in contract for necessaries--

Government of Malaysia v Gurcharan Singh Government of Malaysia v Gurcharan Singh (1971)(1971)

--Pf claim $11500 i.e the sum actually Pf claim $11500 i.e the sum actually spent by the government in educating the df. spent by the government in educating the df. At At that time of the contract, df was a minor. that time of the contract, df was a minor. The court held that education was necessary The court held that education was necessary thus, the df was liable for the repayment of thus, the df was liable for the repayment of reasonable sum spent on him.reasonable sum spent on him.

-necessaries depends on minor situation of life. -necessaries depends on minor situation of life. Eg: clothes could well be ‘necessaries’ but if the Eg: clothes could well be ‘necessaries’ but if the minor is already adequately stocked, they may minor is already adequately stocked, they may be treated as mere luxury.be treated as mere luxury.

Minor’s liability include necessaries Minor’s liability include necessaries supplied to anyone whom he is legally supplied to anyone whom he is legally bound to support eg: wife & children.bound to support eg: wife & children.

False representation that he was of full False representation that he was of full age:age: Natesan v Thanaletchumi(1952)Natesan v Thanaletchumi(1952)

When an infant has induced a person to contract When an infant has induced a person to contract with her by means of a false representation that with her by means of a false representation that she was of full age, she is she was of full age, she is not estopped from not estopped from pleading her infancypleading her infancy in avoidance of the contract. in avoidance of the contract.

5. Scholarship 5. Scholarship

-a scholarship entered by a minor is a -a scholarship entered by a minor is a valid contract.valid contract.

loanloan

sponsorshipsponsorship

appointment to the course of appointment to the course of studystudy

any other facility for the purpose any other facility for the purpose

of education and learning.of education and learning.

6. Insurance6. Insurance

- a minor above 10 may enter a - a minor above 10 may enter a contract of insurance but if below contract of insurance but if below 16,must have written consent from his 16,must have written consent from his parent/guardian.parent/guardian.

7. Apprenticeship7. Apprenticeship- the - the Children and Young Person Children and Young Person (Employment) Act 1966:(Employment) Act 1966: “ “minor (below 14) and young person minor (below 14) and young person (btw 14 and 16) may enter into a contract (btw 14 and 16) may enter into a contract of apprenticeship”of apprenticeship”

- they may sue or defend under such - they may sue or defend under such contracts of service, but no damages or contracts of service, but no damages or indemnity can be recovered from him for indemnity can be recovered from him for breach.breach.

8. Guarantee 8. Guarantee

guarantee S69CAguarantee S69CA: if the contract between : if the contract between principal debtor and creditor is invalid principal debtor and creditor is invalid because of minority, the guarantee is void because of minority, the guarantee is void so the guarantor is not liable.so the guarantor is not liable.

““validity of main contract is a pre-condition validity of main contract is a pre-condition for the guarantee” for the guarantee”

PERFORMANCE &RECOVERY PERFORMANCE &RECOVERY OF BENEFIT FROM MINOROF BENEFIT FROM MINOR

sec 66 CA: when an agreement is sec 66 CA: when an agreement is discovered to be void, any person who has discovered to be void, any person who has receive any advantage under the agreement or receive any advantage under the agreement or contract is bound to restore it, or to make contract is bound to restore it, or to make compensation for it, to the person from whom compensation for it, to the person from whom he receive it.he receive it.

if contract voidif contract void restorerestore

compensationcompensation

Soundmind…….Soundmind…….

Sec 12 CA: sound mind= at the time when Sec 12 CA: sound mind= at the time when a person makes a contract, he is a person makes a contract, he is capable capable of understandingof understanding it and of forming a it and of forming a rational judgment as to the contract effectrational judgment as to the contract effect on his interest.on his interest.

Person of mentally disorder, and person Person of mentally disorder, and person incapacitated through sickness, alcohol or incapacitated through sickness, alcohol or drugs are drugs are not competentnot competent to contract. to contract.

Effect: Effect: voidablevoidable at the option of the person at the option of the person of unsound mind but must proveof unsound mind but must prove

Must prove unsound

or intoxication condition

Must prove other parties knows of his condition