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Par   •  29 Mai 2018  •  3 831 Mots (16 Pages)  •  274 Vues

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While both an offer and its acceptance could be made or concluded from the conduct or the words of the parties involved, the conduct or words must obey to some rules that have been laid before the acceptance will be granted its validity. These rules have been established by the courts over the years as an outcome of the several contract issues that arose before them. Nowadays, the main rules for acceptance are well recognized and established. The prime general rule of acceptance in contract where the response is necessary is simply the opposite of the rule for offers. This rule under the section 4.1 states that: “the acceptance of the offer must be made known to the offeror in the way implied or requested by the offeror in the offer.” Such as Adams v Lindsell case whereas, on September 2, the defendants D wrote to the P the plaintiffs offering to sell them some fleeces of wool and demanding an answer in the post. The misdirection of the D of the letter restricting the P to receive it until September 5th; The P sent their acceptance on the same day and it was only received on the 9th of September. Meanwhile on 8th the D not having received the acceptance by the 7th as expected, sold the wool to another party.

Consequently, the acceptance must take the form of certain acts or words in accord with the offer that will signal to the offeror that the offeree has accepted the offer made. These conduct or words do not usually required to be precise, but they ought to express the offeree’s intentions to the offeror in the way intended for acceptance.

- The case law: Empirnall Holdings Pty Ltd vs Machon Paull Partners Pty Ltd (1998)

Empirnall engaged Machon Paull to redevelop a site it owned; prior the commencement of the work, Machon Paull submitted a written contract to Empirnall. Empirnall never signed the contract, nevertheless Machon Paull continued to execute the works and Empirnall continued to make the payments based on the contract that has been submitted. Empirnall went eventually bankrupt owning Machon Paul a huge amount of money.

The verdict of the court: In this present case, Empirnall’s acceptance of the work should be considered as acceptance on the terms offered by Machon Paull, this was not simple silence, but comprised conduct in taking the profit of an offer, knowing its terms.


- The concept

The bargain concept of contract stipulates that a contract is fundamentally an arrangement between entities where each obtains something in exchange for his/her promise, under the section 26 of the Contract Acts. In the circumstance that this is the case, thus every promise made by an offeror to do a particular thing ought to be conditional (Fried, 1981). The promise ought to comprise a provision that the offeree, by accepting the offer, will promise something as well to the offeror. That something that the promisor is meant to receive in exchange for the promise of the promisor is referred to as consideration, which constitutes a vital element of a valid contract. Consideration is something that has worth in the eyes of the law and which in exchange for a promise, a promisee receives.

Consideration can have several forms. It could be a payment through money, the execution of a specific service, the renunciation of right, a promise not to do a specific thing by the promisee, the delivery of property, or else several other things, comprising a promise in exchange of the promise. Nevertheless, in each case, the consideration ought to be something that is done in regard to the promise offered obviously by the promisor (Burrows et al., 2002). Except a promisor obtains something in exchange for her or his promise, the promise in barely without compensation or counter-performance, it is gratuitous. In practice, consideration for a promise ought to exist for a contract to be legally valid and binding.

- The case law: Gilbert Steel Ltd vs. University Construction Ltd. (1976)

The issue before the court regarded the compliance of the oral arrangement to pay the higher US$166 and US$178 per ton prices, since the written arrangements only provided for the payments of steel at the prices of US$156 and US$165 per ton.

The verdict of the court: the court held that no consideration existed for the promise to pay the higher price per ton and that the oral arrangement must therefore fail on that basis.

- Exception

Exception enables a contract to be made without any consideration. There are three types of exceptions, but in this report only one will be examined; the section 26 (a) states that there is a contract on account of natural affection and love.

Example: Tan Soh Sim, Chan Law Keong & Ors Iwn Tan Saw Keow & Ors (1951)

Prior to the death of Tan Soh Sim, she express her will to hand over her property to 4 child she has adopted. All other ten heirs signed a document refusing all claims to Tan’s properties in favor of those four adopted child.

The agreement was unenforceable due to the fact that there was no consideration considering the position of the heirs who are not having close relationship with the adopted children.


- The concept

Capacity represents the ability at law to link or bind an individual in contract. It is not everyone who is allowed to enter into contracts that would bind them at law. Some classes of promisors ought to be protected as a manner of public policy, either for reasons of their immaturity and inexperience or because of their incapability to appreciate the nature of their actions and acts in making complying or enforceable promises, under the section 11. There are three instances where the capacity to contract is questioned; the minors, the bankrupts and the mentally impaired and drunken.

- Minors

This class, the set of individuals of tender age known as minors, represents the most obvious one to be protected. A minor based on Malaysian Law is an individual under the age of 18 years. Nevertheless, minors represent a highly and significantly desirable segment of the business marketplace with a purchasing power because of the support of their parents. Therefore, businesses always seek their business activity but ought to be conscious of the unique dangers of doing business with this segment of the marketplace. The public policy stipulates that minors ought not to be bound by their promises, and therefore,


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