4. Capacity of parties.

The parties to an agreement must be competent to

contract. The criteria of competent is contracting parties must be of the
age of majority and of sound mind and must not be disqualified by any
law to which they are subject. If any of the parties to the agreement
suffers from minority, idiocy or lunacy. The agreement is not a contracts
due to not enforceable by law. There are exceptions for the case of the
capacity of person which are marriage contract, scholarship agreement
and employment contract. One good example is the case of Government
of Malaysia v Gurcharan Singh & Ors [1971].

5. Consent. Consent of all the parties to an agreement is another essential

element. This concept has two aspects. Consent means that the parties
must have agreed upon the same thing in the same sense. Consent
should be made and it should be free of any pressure, coercion or
misunderstanding.

6. Legal. For the formation of a valid contract it is also necessary that the
parties to an agreement must agree for a lawful object. The object for
which the agreement has been entered into must not be fraudulent or
illegal or immoral or opposed to public policy or must not imply injury to
the person or the other of the reasons mentioned above the agreement is
void. Thus, when a landlord knowingly lets a house to a prostitute to carry
on prostitution, he cannot recover the rent through a court of law or a
contract for committing a murder is a void contract and unenforceable by
law.

7. Certainty. Section 30 of the contract Act provides that Agreements, the

meaning of which is not certain or capable of being made certain, are
void." In order to give rise to a valid contract the terms of the agreement
must not be vague or uncertain. It must be possible to ascertain the
meaning of the agreement, for otherwise, it cannot be enforced

Illustration.

A, agrees to sell to B a hundred ton of oil" there is nothing whatever to

show what kind of oil was intended. The agreement is void for uncertainly.
"An agreement to do an act impossible in itself is void". If the act is
impossible in itself, physically or legally, the agreement cannot be
enforced at law.

A, agrees to sell to B all the grain in my granary at Ipoh. There is no

uncertainty here to make the agreement void.

In conclusion, an agreement is only a promise that is made by two

parties with the consideration of others without the intention to create a
legally binding relation. For an agreement to be considered as contract, it
must be enforceable by law as per Section 2(h) states that an agreement
that is enforced by law is a contract. In order to do so, the agreement
must fulfill the requirements for a valid contract. In the situation where an
agreement does not fulfill other requirements such as it is being made
with mere consideration and without intention to create legal relation or
the parties of the contract are not competent, it is not enforceable. Thus,
it is why not all agreement can be considered as a contract.

Books

1. Cheong May Fong, Contract Law in Malaysia.

Articles and Reports

1. http://www.lawnotes.in/Malaysian_Contracts_Act,_1950#Part_I:_Preli
minary.