1) LAW OF AGENCY

a) Formation of agency

Express
appoinmen
t
Implied
appoinment

Doctrine of
estoppel

FORMATI
ON OF
AGENCY
Necessity

Ratification

b) 9 duties of agent toward principle

Oooo
Dini
Cukup
Sempurna
Pada
Ali

Agent must obey principals instruction

Agent cannot delegate his authority to other
person
In absence of instructions, agent must act
according to customs

Sampai

Agent not to make secret profit (3R D Sue)

Fatin

Agent duty to pay all sum received to principal

Cemburu

Agent must render proper account when required

Agent must use all skills he possess in carrying
out work

Remedies for Principal if the agent receives secret profit

3R

The principal may repudiate the contract

which was made on his behalf by the agent
with a 3rd party.
The principal may recover the amount of the
secret profit
The principal may refuse to pay the agents
commission or other remuneration.

Di

TERMINATION BY THE OPERATION

The principal may dismiss or terminate the
OF LAW
agents authority for the beach of duty.

By the performance of the

contract of agency.
By the expiration of the
period fixed or implied in the
contract of agency.
By the death of either the
principal
or thethe
agent.
The principal may
sue both
agent and the
TERMINATION BY THE ACT OF
rd
- Exceptions:
3 party who
gave the bribe for the losses
THE PARTIES
i) The
agency would not
suffered.
Mutual consent
terminate if the agent has an
- Principal and agent may
interest in the property
ii) Death of principal is only
terminate their agency
effective upon the agent having
relationship by mutual consent
notice of the principals death.
between them
iii) The agent must take
By unilateral revocation by the
reasonable steps to protect and
principal
- Agency may be terminated by
preserve the interest of the
the act of the principal revoking
principal.
By the subsequent insanity of
the agents authority at any
either the principal or the agent.
time before the agent has
On termination due to the
exercised the authority.
insanity of the principal, the
- The principal must give a
agent is bound to take all
reasonable notice to the agent
- Exceptions:
reasonable steps to protect and
i) Agent himself has an interest
preserve the principals interest.
in the property
By the bankruptcy or insolvency
ii) After the authority has been
of the principal
c) Termination of agency
partly exercised by the agent
- When principal being declared
By unilateral renunciation by
bankrupt, his right and liabilities
Termination of are vested in the official
the agent
- Must be express or implied Agency
assignee.
- The agent must give a
By the happening event which
reasonable notice
renders the agency unlawful.
MNEMONIC
- This falls within the doctrine of
frustration in contract.
UUM & PEDIBU

Sue

2) LAW OF HIRE PURCHASE

a) Statutory rights of hirer

Coffee

Right to copy statement relating to

financial position
Right to appropriation of
payment
Right to apply goods to be
removed
Right to assign

3A
Operation
Early
Time
b) Formation of hirer purchase

Right by operation of
law
Right to early completion of
agreement
Right to termination of
agreement

Noris
Wati
Signed

Duty to give 2nd Schedule notice before entering HP

agreement.
HP agreement must be in writing.

Detail
Supaya
Nanti

HP agreement must be signed.

HP agreement must contain certain details.
3. Repossession

Cerita

Separate
agreement
itemrepossession
of goods. must has
S 17A
Person for
to every
undertake

Menarik

Hooligan or
if not penalty under
No alterations
or gangster
additionsnot
to allowed,
the agreement.

written permit issued by Controller/Ministry

S 46

Repossession
done certificate.
lawfully and according to the
Motor vehicles
registration
manner prescribed by regulations
Control
Person who apply permit should:
Altered or modified motor vehicles.
- 21 years and above
- Malaysian citizen
BF
Declaration
secondby
hand
- Noton
convicted
any motor
offencevehicles.
Any
other
requirement
determine by controller
Demand

Permit
valid
for
2
years
Copy of the agreement must be served to hirer and
May revoked/cancel permit of involved in any offence
guarantor.
Repossession agent must show permit, identity and
authority card
c) Procedure of repossession
Booking
fee.
No
forces or criminal act
After repossession, served document to hirer
immediately (by hand)
Document contain date, time, place
Time repossess can be done 9.00 am 9.00 pm

Dapat

1. Default in payment
Right of repossess - S16(1)
Amount payment <75%
2 successive default in payments
Cannot repossess - S16(1A)
Amount payment >75%
2 successive default in payment
But can repossess if get order from the court
If hirer death, repossess if 4 successive default in pay

2. Service of 4th Schedule Notice

Duty on the owner to give 4th Schedule notice within 21 days bef
Repossess before 21 days are void Pang Brothers Motors Sdn B
Give second notice (reminder) after 14 days
If hirer abscond/conceal, notice need not to be served
Returns the goods Not liable to pay cost of repossession, storag
No repossession if pays the default within 21 days

4. Service of 5th Schedule Notice

2 options:
- Resume possession within 21 days, pay
all default and penalty
- Terminate contract and pay the balance
sum payable
If owner fail to serve notice, he will losses all
rights

5. Selling of
Public auction: owner must serve hirer copy of
auction sale notice less than 14 days
Non-public auction: owner given an option to
hirer to buy the goods
If proceed, hirer need to pay the outstanding
amount due and bear the auction expenses

3) NEGOTIABLE INSTRUMENT
a) Characteristic of cheque

We

Say

DaeBak

Pada

Specified person

It must be an
unconditional order in
writing
The cheque must be
signed

It is drawn in banker

It orders the banker to

pay a sum of money on
demand

The cheque is drawn for a

specified person or in
favour of a bearer

a) A contract without consideration is void. Discuss.

QUESTION 2
Ante dated and post-dated cheques
Overdue or stale cheques
hich is dated may be ante dated, post- dated or Sunday dated.
- S. 36(3) A cheque is overdue if it has been in circulation for unreasonable length of time, nor
is a cheque which bears a date before the date of issue
- Unreasonable depends on the facts of case.
s one which bears a date in future.

Types of
cheques

- S.3(4)(a) -A cheque which is not dated is a

valid cheque.
Undated cheque
b) Types of cheque and types of crossing cheque

Under the law of contract, consideration is one of the elements

which necessary to form a valid contract. This is provided by section 26 of
the Contracts Act 1950. According to section 2(d) consideration means
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 as act or
abstinence or promise. Consideration is something which has value in the
eyes of law and it becomes the basis of the contract. It is a price which is
paid by one party in return to a promise or act done by another party.
General rule under consideration is that an agreement without
consideration is void. Even though consideration is an essential element is
a valid contact, there are several exceptions which allow certain contracts
to exist without the element of consideration. These exceptions are
provided in sections 26(a), (b) and (c) of the Contracts Act 1950.
Section 26 (a) provided that an agreement made on account of
natural love and affection. There are three conditions that must be fulfilled
by parties who made agreement. First is the agreement must be
expressed in writing which may be in any reasonable form. Second, the
agreement must be registered. Last but not least, agreement must be
made on account love and affection between parties standing in near
relation to each other. The relevant case for this exception is Re Tan Soh
Sim. In this case, the contract was not valid since there was no
consideration from the part of the 4 adopted children for the promise
made by the legal next-of-kin of TSS.
The provision under Section 26(b) explains that when there is a
promise to compensate someone who has done a voluntary act. There are
two conditions must be fulfilled that are it is a promise to compensate the
promise and the promise has voluntarily done something for the promisor.
This is refers to the case J.M. Wotherspoon & Co Ltd v Henry Agency
House that held that the promise made by the D to compensate the P was
not an enforceable contract within this exception. Section 26 (b) is also
concerned that agreement to compensate an act which the promisor was
legally compellable to do. The condition for this exception that must be
fulfilled are the promise has voluntarily done an act, the act is one of the
promisor was legally compellable to do and an agreement to compensate
the promisee for the act.

Section 26(c) provided an agreement to pay statute-barred debt. A

statute-barred debt refers to a debt which cannot be recovered through

legal action because of lapse of time fixed by law which is within six
years.. For agreement to become a valid contract even without
consideration, two conditions need to be fulfilled; the debtor made a fresh
promise and promise is in writing and signed by the promisor.

b)
The issue is whether there is a contract between Ali and Ani. The
second issue is whether the agreement which made between family
members are valid or not. Lastly, the issue is whether Ali has the right
refused to transfer the house to Ani or not.
Intention to create legal relations is one of the basic elements of
contract. In view that the Contracts Act 1950 does not contain any
provision with regards to this principle, English common law is applicable.
The law divides agreements into two classes, first is commercial or
business agreement and second is social, domestic or family agreement.
Social, domestic and family agreements are agreements which are made
between friends and family or social arrangements. In such an agreement
the law presumes that there is no intention to create legal relation
between the parties. However, the presumption may be rebutted by
giving evidence. The relevant case is Merrit v Merrit. In this case, it was
held there is a binding contract between the husband and wife because
the parties had intended to create legal relations by making their
agreement in writing and signed by the husband. Accordingly the house
must be transferred to the wife.
In Anis case, her husband promised to transfer the house to her by
made a writing agreement on piece of paper and signed it. By referring to
the case Merrit v Merrit, Ani can claim the house from her husband by
rebut it with the evidences which the agreement they have been made. In
addition, since Ani has performed the obligations to continue the payment
of the house, the contract between them is valid.
In conclusion, there is a binding contract because Ani had intended
to create legal relation by making their agreement in writing and signed
by Ali. So, Ali has no right to refused transfer the house to Ani. Accordingly
the house must be transferred to Ani.