Group Assignment

Case Study 2a
Business Law (MKK-1223)
Introduction
The law of contract is the basic law that governs and relates to most aspects of
human life.
It governs human daily activities in almost all aspects, which is may vary from
simple contracts entered by individuals in order to get daily supplies to contracts
of marriage and others.
Contract provides the means for individuals and businesses to sell or transfer
property, services and other rights.
The common law of contracts developed in England around the thirteenth
century. Malaysian contract law evolved from English common law. In Malaysia,
the Contract Act 1950 (CA 1950) governs the law of contract.
Content of Contract Act 1950
(a) 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 to the act or abstinence, he is said to make a
proposal.
(b) When the person to whom the proposal is made signifies his assent thereto, the proposal is said
to be accepted: a proposal, when accepted, becomes a promise.
(c) The person making the proposal is called the promisor and the person accepting the
proposal is called the promisee.
(d) When, at the desire of the promisor, the promisee or any other person has done or abstained
from doing, or does or abstains from doing, or promises to do or to abstain from doing,
something, such act or abstinence or promise is called a consideration for the promise.
(e) Every promise and every set of promises, forming the consideration for each other, is an
agreement.
(f) Promises which form the consideration or part of the consideration for each other are called
reciprocal promises.
Content of Contract Act 1950
(g) An agreement not enforceable by law is said to be void.
(h) An agreement enforceable by law is a contract.
(i) An agreement which is enforceable by law at the option of one or more of the parties
thereto, but not at the option of the other or others, is a voidable contract.
(j) A contract which ceases to be enforceable by law becomes void when it ceases to
be enforceable.
Exception
It is in writing and registered
(a) It is expressed in writing and registered under the law (if any) for the time being in force for
the registration of such documents, and is made on account of natural love and affection
between parties standing in a near relation to each other.
Or is a promise to compensate for something done
(b) It is a promise to compensate, wholly or in part, a person who has already voluntarily
done something for the promisor, or something which the promisor was legally compellable
to do or
Or is a promise to pay a debt barred by limitation law
(c) It is a promise, made in writing and signed by the person to be charged therewith, or by
his agent generally or specially authorized in that behalf, to pay wholly or in part a debt of
which the creditor might have enforced payment but for the law for the limitation of suits.
Case Study
Pak Man wants to give his land to his daughter Jusnita, for her 21st birthday.
As Jusnita will not be paying any money to her father. Her father is worried
that since there is no consideration for the transfer of his land to Jusnita, the
transfer may be void by virtue of section 26 of the Contracts Act 1950. Advise
Pak Man.
Recommendation
A contract based on natural love and affection - fall under exception of Section
26(a) of the Contacts Act 1950.
Although the said Act does not define the near relation, the courts is actually
accepts the members of immediate family will ordinary constitute as near
relation as an example father and son or daughter and mother and son or
daughter.
Full filled the condition as follows:
i) It is expressed in writing
ii) It is registered (if applicable) and
iii) The parties stand in a near relation to each other.
Conclusion
The condition precedent of Section 26 (a) of the Contracts Act has been fulfilled
then the transfer of the property made between both of them deem to be valid
in accordance with Malaysian Law.
The strong and close proximity of relationship between Pak Man and Jusnita as
father and daughter.