law of contract-010216_094655
TRANSCRIPT
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LAW OF CONTRACT
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LECTURER: LIM ENG HOE
email. [email protected]
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FORMATION OF CONTRACT
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Contract
agreement- notenforceable by lawsocial/domesticcontract-enforceable bylawbusiness/commercial
oral
writingconduct
oer Oeree-s2(c)
oeror-s2(c)
Oer –2(a)
acceptan
ceconsideration-s2(d)
intention to treat
Capacity-
s11
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ContractContract! Act "#$%
Consent-s10
egality-s10
Certaint&!'%
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!"#$%$&$O%
' contract is an agreement
between two or more persons to door abstain from doing an act and itis intended to create a legally
binding relation 2(b) Contracts 'ct 1*+0
,wen te person to wom teproposal (oer) is made signi.esis assent tereto te proposal issaid to be accepted a proposalwen accepted becomes a
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(i!tinction: contract an) a*reement+ ,-* Contract! Act "#$%
/an a*reement not en0orcea1le 1& law i!
!ai) to 1e 2oi)3.
+ ,-h CA "#$%
/an a*reement en0orcea1le 1& law i! a
contract3.
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A contract ma& 1e ma)e:
in writin*orall&
1& con)4ct
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What con!tit4te a 2ali) contract5
A 2ali) contract m4!t ha2e 0ollowin* element!". o00er ,. acce6tance
'. con!i)eration7. intention to create le*al relation$. ca6acit& o0 6er!on!8. le*al9. certain. con!ent
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What i0 )oe! not ha2e an& a1o2e
element!5
Contract i! either:
;oi)
;oi)a1le
4nen0orcea1le
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What i! an o00er< o00eror or o00eree5
+ ,-a CA "#$%
/when one 6er!on !i*ni0ie! to another hi!
willin*ne!! to )o or a1!tain 0rom )oin*
an&thin*< with a 2iew to o1tainin* the a!!ent o0
that other to the act or a1!tinence< he i! !ai) to
ma=e a 6ro6o!al -o00er3.
+ , -c CA "#$%
/the 6er!on ma=in* the 6ro6o!al i! calle) the
6romi!or -o00eror an) the 6er!on acce6tin* the
6ro6o!al i! calle) the 6romi!ee -o00eree
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O00er
M4!t 1e a1!ol4te
M4!t 1e 4n>4ali0ie)
M4!t 1e comm4nicate) to o00eree
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O00er
M4!t 1e a1!ol4te< cannot 1e 2a*4e
(e0inite 6romi!e to 1e 1o4n) 1& !6eci0ic term!
A00in Cre)it -Mala&!ia +)n ?h) 2 a6 4en F4i "#7B"ML "8#
Hel): term! o0 o00er m4!t 1e )i!clo!e) 1e0ore acce6tance can
1e *i2en to concl4)e a contract< 0ailin* which !4ch a*reement
i! 2oi).
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O00er m4!t 1e clear< )e0inite an) certainWhite 2 ?l4ett -"$' L ED '8
+on claime) 0ather a*ree) to )i!char*e him 0rom lia1ilit& in
con!i)eration o0 hi! 6romi!e to cea!e com6lainin*.
Hel): +on3! 6romi!e wa! no more than a 6romi!e not to 1orehi! 0ather an) wa! to 2a*4e to 0orm a con!i)eration
?4t in War) 2 ?&ham #$8B " WLR 7#8
Hel): 6romi!e to ma=e chil) ha66& wa! 6art o0 con!i)eration
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+ '% term! o0 a*reement m4!t 1e certain otherwi!e 2oi)
ar466an Chett& 2 +4ah Thian "#"8B
eld 'greement to grant a lease at 345+ per
mont for as long as e li6ed was 7oid foruncertainty
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M4!t 1e comm4nicate) to o00eree
Ta&lor 2 Lair) -"$8 "$8 ER ",%'
T wa! en*a*e) to wor= on L3! !hi6. He threw 46 hi! o1
14t contin4e) to hel6 on !hi6 witho4t L3! =nowle)*e.
+hi6 reache) 6ort an) he claime) rem4neration.
Hel): T co4l) not claim 1eca4!e he )i) not comm4nicatehi! o00er an) L ha) no o66ort4nit& to acce6t hi! o00er.
+ 7 -" /comm4nication o0 6ro6o!al i! com6lete when it
come! to =nowle)*e o0 6er!on to whom it i!
ma)e3.
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O00er: )i!tin*4i!h
In2itation to treat attem6t to in)4ce o00er!(i!6la& o0 *oo)!
Fi!her 2 ?ell "#8%B
harmace4tical +ociet& o0 Great ?ritain 2 ?oot! Ca!h
Chemi!t! "#$,B
A)2erti!ement
Attem6t to in)4ce o00er!
artri)*e 2 Critten)en "#8BA)2erti!ement can !ometime! 1e o00er
Carlill 2 Car1olic +mo=e ?all Co "#'B
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(i!6la& o0 *oo)!
Fi!her 2 ?ell "#8"B
( eDhi1ite) 0lic= =ni0e in hi! !ho6 win)ow. ro!ec4te)
4n)er Re!triction o0 O00en!i2e Wea6on! Act "#$#
Hel): (i!6la& o0 *oo)! in !ho6 win)ow e2en with 6rice
ta* not an o00er 0or !ale 14t an in2itation to treat.
harmace4tical +ociet& o0 G? 2 ?oot! "#$'B
La)& 6ic=e) 46 controlle) me)icine 0rom ?oot!< a !ell
!er2ice !tore. ?oot! wa! 6ro!ec4te) 4n)er harmac& an)
oi!on! Act "#''. Hel): Me)icine! on )i!6la& merel& in2itation to treat onl&
when la)& too= *oo)! to chec= o4t ca!hier !he ma)e
an o00er< which 6harmaci!t at chec= o4t co4l) re04!e.
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A)2erti!ement in2itation to treat
artri)*e 2 Critten)en "#8B
a)2erti!e) 1ram1le0iinch coc=! an) hen! 0or !ale an) wa!
char*e) 0or o00erin* 0or !ale 4n)er rotection o0 ?ir)! Act "#$7.
Hel): when a)2erti!e) he wa! ma=in* in2itation to treat an)
when C re!6on)e) he wa! ma=in* an o00er. I0 3! a)2erti!ementwa! treate) a! o00er then he wo4l) him!el0 contract4all& 1o4n)
to !466l& to all who re!6on)e).
A)2erti!ement o00er
Carlill 2 Car1olic +mo=e ?all Co "#'B
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ometimes in7itation to treat can be oer
ar7ela $n7estment td 7 3oyal &rust Co ofCanada 1*89: 'C 20;
Owner in7ited two bidders for teir sares
and stated tey would accept igest oer#irst bidder submitted .<ed bid and secondbidder submitted referential bid
eld in7itation to tender was an oer of a
unilateral contract to sell to igest bidderecond bid was in7alid because it was areferential bid intended to frustrate te oterbid
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Oer distinguised from supply of information
ar7ey 7 #acey =18*5: 'c ++2
telegraped # , >ill you sell us ?umper all@ &elegrap lowest cas price # telegraped ,owest price for ?A B*00 telegraped # ,>e
agree to buy ?A for B*00 as6ed by you
eld %o contract # merely supplying informationon lowest price acceptable $t was wo made teoer wic was ne7er accepted by #
te7enson 7 4cean (1880) + ?! 5D9eld oeree could still accept oer e7en toug e
ad telegraped to oeror reEuesting informationon credit terms because it did not destroy oer
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Ten)er
In2itation to ten)er i! *enerall& an in2itation to treatan) 1i))er3! ten)er i! an o00er
In2itation to treat attem6t to in)4ce o00er!
Harri! 2 Nic=er!on -"9'
A4ction
In2itation to treat attem6t to in)4ce o00er!
a&ne 2 Ca2e -"9#
?riti!h Car A4ction! 2 Wri*ht "#9,B
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Harri! 2 Nic=er!on -"9'
A4ctioneer a)2erti!e) to hol) a4ction. Harri! tra2elle) toa4ction !ite to 0in) item ha) 1een with)rawn. He !4e) 0or
lo!! o0 eD6en!e! 1eca4!e Nic=er!on wa! in 1reach o0
contract 0or not hol)in* !ale.
Hel): a)2erti!ement o0 a4ction an in2itation to treat toin2ite o00er!.
?riti!h Car A4ction! 2 Wri*ht "#9,B
Hel): 1i) i! an o00er an) 1ecome! a contract when
a4ctioneer acce6t! it. Now in ! 7, +ale o0 Goo)! Act "#$9
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Termination o0 o00er
+ $ -" o00er ma& 1e re2o=e) at an& time 1e0orecomm4nication o0 it! acce6tance i!
com6lete
+ 8-a 1& comm4nication o0 notice o0 re2ocation
+ 8-1 1& la6!e o0 time + 8-c 1& 0ail4re o0 o00eree to 04l0ill con)ition
6rece)ent
+ 8-) 1& )eath or mental )i!or)er o0 o00eror i0
0act o0 )eath or mental )i!or)er come! to o00eree3! =nowle)*e 1e0ore acce6tance
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Cross-oer
- two identical oers wic crossed eacoter will not
conclude a contract because eac oer ismade in
ignorant of te oter &inn 7 oman F Co (18;5) 2* & 2;1
On 28 %o7 18;1 wrote to & to sell im800 tons of
iron at 9*s per ton On same day & wrote to to buy
800 tons of iron at same price etters
crossed in
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Counter-oer
- is a purported acceptance wic does not accept all te terms and conditions of te oerG it introduces
new terms and is treated as a new oer
yde >renc (18D0) 5 ?ea7 55D
! oered to sell is land to A for B1000 but A replied to buy for B*+0 ! refused to accept A later oered
to buy for B1000 ! refused
Court eld no contract made because As counter-
oer is a reHection of ! oer wic could not later beaccepted
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'cceptance
; $n order to con7ert an oer into a contract teacceptance
; (a) must be absolute and unEuali.ed
; (b) be e<pressed in some usual and reasonablemanner unless te proposal prescribed te
manner in wic it is to be accepted $f teproposal prescribes a manner in wic it is to beaccepted and te acceptance is not made in sucmanner te proposer may witin a reasonable
time after te acceptance is communicated to iminsist tat is proposal sall be accepted in teprescribed manner and not oterwise but if efails to do so e accepts te acceptance
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owe7er oeror cannot prescribe silence asa manner in wic it is to be accepted
#eltouse 7 ?indley =1892: 1D2 "3 105;
# wrote to is nepew oering to buy isorse adding ,if $ ear no more about im $
sall assume orse mine at BD0 ?indleyauctioneer sold orse by mista6e tougnepew told auctioneer to e<clude it fromauction
eld %epews acceptance ad not beencommunicated to uncle ence orse did notbelong to im
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Con!i)eration
+ ,8 a*reement ma)e witho4t con!i)eration i! 2oi)+ ,-) /when< at )e!ire o0 o00eror< o00eree or an&
other 6er!on ha! )one or )oe! !omethin* J3
A !ort o0 1ar*ain < >4i) 6ro >4o< !omethin* )one in
ret4rn or in eDchan*e 0or !omethin*
+ ,-) a!t con!i)eration i! 2ali) con!i)eration
A)e>4ac& o0 con!i)eration
ED6lanation , o0 + ,8
Con!ent o0 o00eror i! 0reel& *i2en i! not 2oi) merel&
1eca4!e con!i)eration i! ina)e>4ate
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EDec4tor& con!i)eration
Where a contract i! ma)e in ret4rn 0or an o00er< i.e.
m4t4al eDchan*e o0 a m4t4al 6romi!e!
Ill4!tration -a ! ,7 A3! 6romi!e to !ell the ho4!e i! the
con!i)eration 0or ?3! 6romi!e to 6a& K"%<%%% 0or the
ho4!e.
EDec4te) con!i)eration
Where a 6romi!e i! ma)e in ret4rn 0or the 6er0ormance o0
an act
e.*. A ha! lo!t her 64r!e. +he o00er! to 6a& K"%% to an&onewho can 0in)! an) ret4rn! her 64r!e. ? 0in)! her 64r!e an)
ret4rn! it to her. A ha! to 6a& ? 0or her eDec4te) act
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Con!i)eration m4!t 1e law04l
+ ,7 an a*reement o0 which the o1ect or con!i)eration i! 4nlaw04l i! 2oi)
+ ,7-a it i! 0or1i))en 1& law
+ ,7-1 it wo4l) )e0eat an& law
+ ,7-c it i! 0ra4)4lent
+ ,7-) it in2ol2e! or im6lie) in4r& to the 6er!on
or 6ro6ert& o0 another
+ ,7-e co4rt re*ar)! it a! immoral or o66o!e) to
641lic 6olic&
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?ilateral contract
M4t4al eDchan*e o0 6romi!e! 1etween 6artie!
Unilateral contract
There i! onl& a 6romi!e 1& the o00eror. The o00eree
ma=e! no 6romi!e. He 6er0orm! the act to concl4)e
the contract. U!4all& an o00er 0or 6er0ormance o0 act
e.*. Carlill 2 Car1olic +mo=e ?all Co "#'B
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a!t con!i)eration
A 6romi!e i! ma)e !41!e>4ent to an) in ret4rn 0or anact that ha! alrea)& 1een 6er0orme)
+ ,8 Ill4!tration -c A 0in)! ?3! 64r!e an) *i2e! it to
her. ? 6romi!e! to 6a& A K"%%. It i! a contract
e.*.e6on* ro!6ectin* Lt) + a*athe!an Or! 2 A
E +chmi)t Maorie +chmi)t "#8$B
A*reement 1& com6an& to 6a& +chmi)t a0ter it!incor6oration i! le*all& 1in)in*
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A)e>4ac& o0 con!i)eration+ ,8 ED6lanation ,
A*reement to which con!ent o0 o00eror i! 0reel& *i2en
i! not 2oi) merel& 1eca4!e con!i)eration i! ina)e>4ate
Tho4*h ina)e>4ac& o0 con!i)eration ma& 1e ta=en
into 1& co4rt in )eterminin* whether con!ent i! 0reel&
*i2en
e.*. han* +wee im 2 ?eh I Hoc= "#87B ML ''
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EDce6tion to *eneral r4le o0 con!i)eration+ ,8 a*reement witho4t con!i)eration i! 2oi)
EDce6tion
+ ,8-a a*reement ma)e 0or nat4ral lo2e an)
a00ection with con)ition! m4!t 1e ma)e in writin*<
re*i!tere)< i0 re*i!tera1le an) 6artie! in near relation
+ ,8-1 a*reement to com6en!ate a 6er!on 0or 6a!t
2ol4ntar& act or 0or which o00eror i! le*all& com6el to)o
+ ,8-c 6romi!e to 6a& )e1t 1arre) 1& limitation law
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Con!i)eration nee) not mo2e 0rom o00eree+ ,-) when at )e!ire o0 o00eror< o00eree or an&
other 6er!on ha! )one J..!omethin*< !4ch act i! a
con!i)eration
e.*. ;en=ata Chinna&a 2 ;eri=atara Ma&a -""
Mother *a2e lan) to !i!ter in con!i)eration !i!ter
wo4l) *i2e 1rother! an ann4it& !4m hel) to 1e 2ali)
con!i)eration tho4*h 1rother! )i) not *i2e an&con!i)eration
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Wai2er o0 6er0ormance
+ 87 o00eree ma& )i!6en!e with the 6er0ormance o0
a 6romi!e ma)e to him< or eDten) the time 0or !4ch
6er0ormance< or ma& acce6t in!tea) o0 it an&
!ati!0action which he thin=! 0it+ 87 Ill4!tration -1
A owe! ? K$%%%. A 6a&! to ?< an) ? acce6t!< in
!ati!0action o0 whole )e1t< K,%%%. Whole )e1t i!
)i!char*e)
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Wai2er o0 6er0ormance thir) 6art&
+ 87 Ill4!tration -c A owe! ? K$%%%. C 6a&! to ?
K"%%%< an) ? acce6t! them in !ati!0action o0 hi! claim
on A. Thi! 6a&ment )i!char*e! whole claim.
e.*. er6a +in*h 2 ?aram +in*h "#88B " ML '
? owe) K<8#.87 in 4)*ment )e1t. ?3! !on<G4r1a=ha!h wrote to o00erin* to 6a& K7%%% in 04ll
!ati!0action o0 hi! 0ather3! )e1t. 3! law&er! ca!he)
che>4e an) retaine) mone&. The& then 6rocee)e) to
!4e 0or 1alance. Co4rt hel) acce6tance o0 6a&ment
6recl4)e them 0rom claimin* 1alance
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INTENION TO CREATION LEGAL RELATION+
Reco*ni!e 4n)er common law a! an element 0oreDi!tence o0 contract
Mala&!ian contract law tho4*h !ilence reco*ni!e! 4n)er
common law !4ch element a! e!!ential 0or contract to 1e
en0orcea1le+ocial an) )ome!tic a*reement
re!4m6tion that there i! no intention to create le*al
relation!< tho4*h re14tta1le
e.*. ?al0o4r 2 ?al0o4r "#"#B
one! 2 a)a2atton "#8"B
Merritt 2 Merritt "#9%B
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CAACIT
artie! m4!t ha2e le*al ca6acit& to enter intocontract
+ "% all a*reement! are contract! i0 ma)e 1&:
". 0ree con!ent o0 6artie! ,. 6artie! are com6etent
'. con!i)eration an) o1ect are law04l
7< a*reement not )eclare) 2oi)
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+ "" tho!e com6etent to enter into contract are:
". 6er!on! o0 !o4n) min),. reache) a*e o0 maorit& -" &ear! ol)
A*e o0 Maorit& Act "#9"
'. 6er!on! not )i!>4ali0& 1& law
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Tho4*h minor< can< 6ro2i)e) 0or !cholar!hi6 or !=ill trainin* -Contract!
-Amen)ment Act "#98 0ollowin* Go2t o0
Mala&!ia 2 G4rcharan +in*h Or! "#9"B0or nece!!arie! Na!h 2 Inman "#%B wai!t
coat
In!4rance In!4rance Act "#8' -Re2. "#9, can
enter into contract 0or in!4rance 1elow "8 &r! 14t
with con!ent o0 6arent!*4ar)ian
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CERTAINT
Term! o0 contract m4!t 1e certain+ '% a*reement< meanin* o0 which i! not
certain< or ca6a1le o0 1ein* certain i! 2oi)
e.*. ar466an Chett& 2 +4ah Thian "#"8B
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RI;IT OF CONTRACT
Onl& 6artie! to contract can !4e or 1e !4e)Onl& 6artie! to contract ha2e ri*ht! an)
o1li*ation! 4n)er contract.
(4nlo6 ne4matic T&re 2 +el0ri)*e "#"$BAC79
( !ol) t&re! to + with 6rice re!triction< i0 !ol)
1elow 6rice wo4l) 6a& ( $ each t&re. + !ol) to
c4!tomer 1elow re!tricte) 6rice. ( !4e) +.
Hel): ( )i) not 6ro2i)e con!i)eration to + an) (
not 6art& to contract 1etween + an) c4!tomer.
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ac=!on 2 Horion Holi)a&! Lt) B"#9$B ' All ER #,
1o4*ht holi)a& 0or 0amil&. Holi)a& 0ell !hort o0 what ha)
1een 6romi!e). claime) )ama*e! 0or all.
Hel): entitle) to claim 0or him!el0 an) 0amil&. Famil& a!
1ene0iciarie! were entitle) to the claim.
Woo)ar In2e!tment 2 Wim6e& Con!tr4ction "#%B " All ER
$9"
Woo)ar contracte) to !ell lan) to Wim6e& 0or "$%<%%% on
1ehal0 o0 thir) 6art&. Wim6e& 1reache) contract. Woo)ar !4e)
0or 1oth !4m!.
Hel): E2en i0 Wim6e& wa! in 1reach Woo)ar co4l) onl&!4ccee) in claim 0or them!el2e! 14t not 0or thir) 6art& a! the&
were not 6ri2& to the contract. Woo)ar ha) not !400ere) in
re!6ect o0 that lo!! o0 thir) 6art&
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TERM+ OF CONTRACT
Contract contain! term! an) con)ition! a*ree) 1&
6artie! to contract
Can 1e eD6re!! or im6lie)
ED6re!! Term!The!e are term! an) con)ition! a*ree) to in
writin* or orall& 1& 6artie!
Im6lie) Term!
artie! ma& not ha2e eD6re!!l& a*ree) to the
term! an) con)ition! 14t !tat4te 6ro2i)e! 0or each
term! an) con)ition! to 1e im6lie) into contract
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e.*. +ale o0 Goo)! Act "#$9
!eller ha! ri*ht to !ell -con)ition Hire 4rcha!e Act "#89
*oo)! !hall 1e o0 merchanta1le >4alit&
C4!tom< U!a*e an) Co4rtTerm!< tho4*h not eD6re!! !ometime! im6lie)
into contract
a!t (ealin*o64lar In)4!trie! 2 Ea!tern Garment
Man40act4rin* +)n ?h) "##B
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Co4rt
Co4rt im6lie! term! into 6artie!3 contract to *i2e
04ll e00ect to 6artie!3 intention an) 14!ine!!
e00icac&
on* Un* ai 2 Entin* "#8$B
Co4rt im6lie! into contract that !ale o0 tim1er
re>4ire licence. E entitle) to re04n)
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Con)ition
maor term or e!!ence o0 contracti0 1reache)< innocent 6art& can re64)iate an)
terminate contract an) claim )ama*e!
Warrant&minor term which i! collateral to main 64r6o!e o0
contract.
i0 1reache)< innocent 6art& cannot re64)iate or
terminate contract 14t onl& !ee= )ama*e!
e.*. A!!ociate) Metal +melter! Lt) 2 Tham Cheow
Toh "#9"B
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EPEMTIONEPCLU+ION CLAU+E+
Contract ma& contain eDcl4!ion cla4!e eDem6tin*or limitin* one 6art& 0rom lia1ilit& 0or 0a4lt )one
to another 6art&
+IGNE( AGREEMENT
I0 6artie! !i*ne) contract containin* eDcl4!ion
cla4!e! then the& are 1o4n)
e.*. L3E!tran*ee 2 F3Gra4co1 Lt) "#'7B
UN+IGNE(
(e6en) whether contract4al or noncontract4al
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Contract4al
M4!t *i2e rea!ona1le notice< e.*. !i*n1oar) whichi! clear an) 4nam1i*4o4!
e.*. Thom6!on 2 Lon)on< Mi)lan) an) +cotti!h
Railwa& Co
I0 4nam1i*4o4! contra 6ro0eren)4m r4le a66lie!
Timin* o0 notice
M4!t 1e *i2en 1e0ore contract ma)e
e.*. Thornton 2 +hoe Lane ar=in* Lt) "#9"B
Olle& 2 Marl1oro4*h Co4rt Lt) "#7#B
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rior )ealin*e.*.?almain New Ferr& Co 2 Ro1ert!on "#%8B
M4!t not 1e&on) 7 corner!
e.*.Co4ncil o0 Cit& o0 +&)ne& 2 We!t "#8$B Noncontract4al
M4!t 1rin* act4al notice to other 6art&
e.*. Ca4!er 2 ?rowne "#$,B
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Le*al< 2oi) an) 2oi)a1le contract
Le*al: ! ,-h CA
;oi): ! ,-* CA
! "% 4nlaw04l o1ect or con!i)eration
! "" a*reement 1& minor< 6er!on o0 4n!o4n) min)
! ," a*reement entere) into 4n)er mi!ta=e
!,8 witho4t con!i)eration
! '% a*reement meanin* o0 which i! 4ncertain
;oi)a1le: ! ,-i
! "$ coercion ! "8 4n)4e in0l4ence
! "9 0ra4)
! " mi!re6re!entation
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;OI(A?LE CONTRACT
+ ,-i an a*reement which i! en0orcea1le 1& law
at o6tion o0 one 14t not at o6tion o0 the other i! a
2oi)a1le contract
+ "% all a*reement! are contract! i0 the& are ma)e
1& 0ree con!ent o0 6artie! com6etent to contract 0or alaw04l con!i)eration an) with a law04l 64r6o!e are
not 2oi)
+ "#-" when con!ent to a*reement i! ca4!e) 1&coercion< 0ra4)< or mi!re6re!entation< a*reement i! a
contract 2oi)a1le at o6tion o0 6art& who!e con!ent
wa! !o ca4!e)
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+ "#-, a 6art& to a contract who!e con!ent wa!ca4!e) 1& 0ra4) or mi!re6re!entation ma&< i0 he
thin=! 0it< in!i!t that contract !hall 1e 6er0orme)
an) he !hall 1e 64t in 6o!ition in which he wo4l)
ha2e 1een a! i0 re6re!entation wa! tr4ee.*. A inten)in* to )ecei2e ?< 0al!el& re6re!ent!
hi! com6an& wa! ma=in* RM$ M a &ear an)
here1& in)4ce! ? to 14& com6an&. Contract i!2oi)a1le at o6tion o0 ?
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EDce6tion
I0 con!ent i! ca4!e) 1& mi!re6re!entation or 1&!ilence or 1& 0ra4)4lent act within ! "9 contract i!
not 2oi)a1le i0 6art& who!e con!ent i! !o ca4!e)
ha! meanin* o0 )i!co2erin* tr4th with or)inar&
)ili*ence
e.*. A< 1& mi!re6re!entation o0 ?< lea)! ?
erroneo4!l& to 1elie2e hi! com6an& i! ma=in*
RM$ M a &ear. ? eDamine! acco4nt an) )i!co2er!com6an& i! onl& ma=in* RM7 M a &ear. ? 1o4*ht
com6an&. Contract i! not 2oi)a1le
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Where contract i! 2oi)a1le a**rie2e) 6art& ha!
ri*ht to either contin4e with contract or re64)iate it
+ "7 con!ent i! !ai) to 1e 0ree when not ca4!e)
1&:
+ "$ coercion commit or threaten to commit
an& act 0or1i))en 1& law or 4nlaw04l )etainin* orthreaten to )etain an& 6ro6ert& to 6re4)ice o0 an&
6er!on
+ "8 4n)4e in0l4ence 6er!on in 6o!ition to)ominate will o0 the other 4!e that 6o!ition to
o1tain 4n0air a)2anta*e
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+ "9 0ra4) inten) to )ecei2e another 6er!on or
to in)4ce another to enter into contract
+ " mi!re6re!entation
-a 6o!iti2e a!!ertion which i! not tr4e 1&
6er!on tho4*h he 1elie2e! to 1e tr4e
-1 an& 1reach o0 )4t&< witho4t intention to
)ecei2e *i2e! an a)2anta*e to 6er!on committin*
it
-c ca4!in* howe2er innocentl& 6art& toa*reement to ma=e mi!ta=e a! to !41!tance o0
thin*
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(I+CHARGE OF CONTRACT
". 1& 6er0ormance
artie! ha2e 6er0orme) their o1li*ation! 4n)er the
contract
+ 7% i0 a 6art& re04!e! to 6er0orm or )i!a1le)
him!el0 0rom 6er0ormin* the other 6art& can 64t en)to contract
,. 1& a*reement
artie! ma& con!ent to m4t4all& a*ree to en)contract
+ 8' ! 87 6ro2i)e 0or to en) contract 1& con!ent
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'. 1& 0r4!tration
+ $9 -, contract 1ecome! im6o!!i1le or ille*al to
6er0orm !41!e>4ent to the ma=in* 1ecome! 2oi)<
e.*. Ta&lor 2 Cal)well "8'B )e!tr4ction o0 !41ect
matter rell 2 Henr& "#%'B !46er2enin* e2ent
ca4!e) contract im6o!!i1le to 6er0orm+el0 in)4ce) 0r4!tration )oe! not )i!char*e contract<
e.*. Ramli 1in Qa=aria Or! 2 Go2t o0 Mala&!ia
"#,B
Fr4!tration )oe! not a66l& merel& 6er0ormance
1ecome! more )i00ic4lt< e.*. ha4 (aw a4 2 im
Nam Realt& (e2elo6ment +)n ?h) "#7B
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Fr4!tration
+ 88 an& a)2anta*e recei2e) m4!t 1e re!tore)
7. 1& 1reach
Either 6art& to contract 0ail to 6er0orm hi!o1li*ation! 4n)er contract
+ 7% where one 6art& 0ail! to 6er0orm the other
6art& can re!cin) or en) contract an) claim
)ama*e!
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REME(IE+
Ro1in!on 2 Harman "7B " ED $$Hel): O1ect o0 )ama*e! i! to 64t in4re) 6art& in
6o!ition the& wo4l) ha2e 1een in ha) contract 1een
6er0orme) in a! 0ar a! mone& i! a1le to )o thi!.
An*lia Tele2i!ion 2 Ree) "#9,B " ? 8%R entere) into contract with A to 6ro)4ce 0ilm 14t
a1an)one) it.
Hel): A can claim 0or reliance lo!! or lo!! o0 eD6en!e!
14t not eD6ectation lo!! a! that wo4l) 1e !6ec4lati2e.
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Re!ci!!ion an) )ama*e!
+ 98 6art& that ri*ht04ll& re!cin) can claim )ama*e!
+ 97 6art& not in 1reach can 0rom 6art& in 1reach
lo!! or )ama*e! which nat4rall& aro!e in the 4!4al
co4r!e o0 thin* 0rom 1reach
or which 6artie! =new when the& ma)e contract tolo!! or )ama*e! li=el& to re!4lt 0rom 1reach< i.e.<
14t not 0or an& remote or in)irect lo!! !4!taine) < e.*.
Tham Cheow Toh 2 A!!ociate) Metal +melter!
"#9,B Ha)le& 2 ?aDen)ale "$7B
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Ha)le& 2 ?aDen)ale -"$7 # EDch '7"
H3! mill !to6 wor=in* 1eca4!e o0 1ro=en cran=!ha0t. No !6are
!o !ent a! 6attern to man40act4rer to ma=e new !ha0t. H
en*a*e) ? to tran!6ort !ha0t to man40act4rer 14t ? wa!
ne*li*ent 0or late )eli2er& to man40act4rer. A! re!4lt H3! mill
ha) to !h4t )own lon*er than nece!!ar&.
Hel): ? co4l) not claim 0or lo!! o0 6ro0it a! it wa! not withinthe contem6lation o0 the 6artie! a! H co4l) ha2e a !6are !ha0t.
;ictoria La4n)r& 2 Newman In)4!trie! "#7#B , ?$,
; wante) to eD6an) 14!ine!! an) 1o4*ht !econ)han) 1oiler.
While )i!mantlin* N ne*li*entl& )ama*e) it re!4lte) in )ela&o0 ,, wee=! to 0iD 1oiler.
Hel): ; co4l) claim 0or lo!! o0 6ro0it 1oiler co4l) 6ro)4ce)
14t not the eDtra 6ro0it ? ha) ma)e 0rom another contract.
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E>4ita1le reme)&
In4nction i! an or)er 1& co4rt to )e0a4ltin* 6art&to !to6 )oin* an act
+6eci0ic 6er0ormance i! an or)er 1& co4rt to
)e0a4ltin* 6art& to 6er0orm contract a! a*ree)
+ "-" +6eci0ic Relie0 Act "#$% !tate! when
co4rt ma& *rant !6eci0ic 6er0ormance
Miti*ation
art& not in 1reach m4!t miti*ate hi! lo!!