contract issue
TRANSCRIPT
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Introduction
Contract
An agreement having a lawful object entered into voluntarily by two or more
parties, each of whom intends to create one or more legal obligations between
them.
The elements of a contract are:
- Offer
- Acceptance
- Competent persons
- Consideration
- Mutuality of obligation.
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Warranty
An agreement with reference to goods which are the subject of a
contract of sale, but collateral to the main purpose of contract, the
breach of which gives rise to a claim for damages but not a
right to reject the goods and treat the contract as repudiated.
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Damages
An award, typically of money, to be paid to a person as compensation for
loss or injury. The rules for damages can and frequently do vary based on the
type of claim which is presented and the jurisdiction.
Damages can be classified into :
- General Damages
- Special Damages
- Nominal Damages
- Substantial Damages
- Exemplary Damages
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Repudiation
Act, intention, or threat of disowning or rejection of an agreement
already accepted or agreed to. Repudiation amounts to a breach of
contract where the refusal to perform is clear or patent, and where it
goes to the heart of the contract
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I want to baketwo hundred
cake at atime.. But!!!
Where I can
buy it??
ISSUE
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Hey jamal.. U can buyit from me.. It can
reach atemperature of at least
2,000F. And Imselling it to you.. Hurm It sound
great.. Should Ibuy it? I think it agood product.
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OK then Halim.. Iwill buy it from u..
Thank you for
selling me a goodproduct..
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I try to bake the cake..But the oven never reach
the requisitetemperature.
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I am very angry and Iwill filed a suit againstHalim and claimingfor Repudiation of the
contract and Damages.I am sure I will winthe case!!!!!
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FACT OF THE ISSUE
Jamal bought the oven from Halim for
commercial purpose but the oven did not reach
the requisite temperature which is 2000-F.
Based on this issue, Jamal as the innocent party can
treat the issue as repudiated and he also can sue
Halim for the damages because Halim breach the
contract.
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THE LAWS OF ISSUE
Malaysian Laws:
Section 40 Contracts Act 1950
Section 74(3) Contracts Act 1950
Section 76 Contracts Act 1950
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Section 74(3) Contracts Act 1950
Compensation for failure to discharge obligation
resembling those created by contract.
Any person injured by the failure to discharge it, is
entitled to receive the same compensation from the
party in default.
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Section 40 Contracts Act 1950
Effect of refusal of party to perform promise wholly.
When a party to a contract has refused to perform,
or disabled himself from performing, his promise in
its entirety, the promise may put an end to the
contract, unless he has signified, by words or
conduct, his acquiescence in its continuance.
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Section 76 Contracts Act 1950
Party rightfully rescinding contract entitled to
compensation
A person who rightly rescinds a contract is entitled
to compensation for any damage which he has
sustained through the non-fulfillment of the
contract.
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APPLICATION OF LAW
JAMAL HAD EXPRESSLY MADE KNOWN BEFORE
PURCHASING THE OVEN THAT IT SHOULD REACH
A TEMPERATURE OF AT LEAST 2000-F
Section 40 Contracts Act 1950 Jamal gives the condition in their contract.
Halim should be known about the condition because Jamalmade he know.
Halim perform his promise and it cannot fulfill the conditionthat Jamal gives in their contract.
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THE OVEN DID NOT REACH THE REQUISITE
TEMPERATURE WHICH IS 2000-F
Section 74(3) Contracts Act 1950Jamal also have a right to receive
compensation from Halim because of thedamages of the oven and his business.
Jamal is the person injured by Halims failureto fulfill the condition of the contract.
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Section 76 Contracts Act 1950
Jamal has the right to repudiate the contractand receive the compensation of his damages
from Halim.Jamal can filed a suit against Halim claim
about the repudiation of the contract anddamages.
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Conclusion
Jamal as the innocent party have a right to terminate a contract.
Halim cannot fulfill his obligation in the contract. So, Jamal can repudiate the
contract and entitled to compensation.
Jamals damage specific as special damages. Special damages are damages of a
kind which the law will not presume in the innocent partys (plaintiffs) favour,
but which must be specifically pleaded and proved at the trial or arbitration
hearing.
In this case, Jamal loss in his money and he lost his profit because of that
situation. As the conclusion of this case, Jamal can filed a suit against Halim claiming
about the repudiation of the contract and the damages that he sustained
because of the breach of the contract.