FOB 2014 Multimedia University

Tutorial 2

Elements of Contract

1. What are the elements of a valid contract?

2. P enters a sundry shop, picks up a loaf of bread priced at RM2.60, shows it to the
shopkeeper (Q) silently puts RM2.60 on the counter. If Q without uttering a word, picks
the cash and puts it in his till.

(a) Is there any elements of a valid contract?

(b) Does the shopkeeper silent amount to acceptance?

(c) What is the consideration?

3. What is the distinguish elements between an offer and the invitation to treat?

4. Why in the case of carlill v carbolic smoke ball co. (1892) the court held that it is an offer
rather than an invitation to treat?

5. W offered to sell a pen to H for RM4.50. H replied by offering to buy for RM4.00 and W
refused. H then claimed to accept the original offer of RM4.50. W again refused. H then
sued W claiming that there was a binding contract made between him and W.

(a) Is H claims valid?

(b) If not, why H claims would not be successful?

6. A by letter offered to buy his nephew’s horse for RM500. He wrote “If I hear no more, I
consider the horse to be mine at RM500”. The nephew did not reply, but ordered the
auctioneer, who was engaged to sell the horse to withdraw the horse from sale. By error,
the auctioneer included the horse in the sale and the horse was auctioned. A sued the
nephew for the loss.
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(a) Does A had a valid claims? Reason

7. The parties signed a memorandum drawn up by the Vendor’s agent, which contained a
clause to the effect that” this agreement is made subject to the preparation of a formal
contract of sale which shall be acceptable to my solicitors on the above terms and
conditions”. The Purchasers wanted to withdraw from the agreement.

(a) Whether the agreement is finalized or not?

8. A gave an option to the agent of B to buy a piece of land subject to (a) a formal contract
to be drawn up and agreed upon by the parties and (b) approval of the sale and of the said
contract by the High Court of Kuala Lumpur . B’s agent duly exercised the option and, on
the A’s failing to sign the agreement of sale, B instituted the present proceedings for
specific performance or damages for breach of contract.

(a) Is there a valid contract? Why?

10. When will an offer be terminated?

11. M applied for shares on 8 June but he was not told until 23 November that his offer had
been accepted and that the shares had been allotted to him and that the balance owing on
the shares was now due. M refused to pay and the company threatened to sue, alleging
breach of contract.

(a) Is the offer still valid ?

(b) If not , why the offer is not valid ?

12. The husband went to work in Ceylon and agreed to pay his wife RM30.00 per month. E
did not pay the money and the wife sued. It was held that there was not contract.

(a) Why the court held that there was no contract?

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13. If A told B that he would sell his new Mercedes to her for RM5, and B agreed to accept
the offer.

(a) Is there a binding contract? Why?

14. A wrote to B on 2 September, offering to sell them some wool and requested that B
reply in course of post. The letter which contained the offer was wrongly addressed and
therefore B did not receive it until 5 September. As a result of this delay, the letter of
acceptance was not received until 9 September by A, and this was two days later than A
would have expected to receive it. On 8 September , A had sold the wool to a third person.

(a) Whether the contract had been entered on 8 September? Why?

15. A, in its newspaper advertisement, promised to give RM1000.00 to anyone who

purchased their smoke ball remedy for influenza, and caught illness within 14 days. To
show good faith, the A deposited RM1000 with a bank to meet any claims.

(a) Is the advertisement an offer or invitation to treat? Why?

16. Who are competent to contract?

17. Can an infant enter into any contract?