Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Professor Gary recently inherited a 20-acre tract of land from his grandfather in Rawang, Selangor. Unknown to Gary, who had never visited Rawang, the

image text in transcribed

image text in transcribed

1. Professor Gary recently inherited a 20-acre tract of land from his grandfather in Rawang, Selangor. Unknown to Gary, who had never visited Rawang, the land contained valuable coal deposits worth RM3,000,000. The BadCoal Company, who knew about the coal deposits, and had made many unsuccessful attempts to purchase the land from Gary's grandfather. One of the agents, Allan, approach Gary and offer to purchase his property for RM1,500,000. Gary explained to Allan that he really had no need for this land, but that he did not want to sell it until he knew the land's market value. At this point, the Allan produced documentation previously prepared by the BadCoal Company showing that 20 acres of land in this portion of Rawang for about RM900,000. This information was generally accurate for tracts of land that did not contain coal or other mineral deposits. When Gary asked Allan why he was willing to pay RM1500,000 for land only worth up to RM900,000, Allan explained that he always fancied this particular piece of land, thought it was very beautiful, and that the additional RM600,000 represented the sentimental value he attached to the land. The following conversation then took place: Gary: Is there anything else about the land I should know about? Allan: Like what? Gary: Well, if the land had gold under it, for example, you'd tell me, right? Allan: Of course I'd tell you if the land had gold under it. In fact, I promise you, if the land turns out to have gold on it, I'll sell it back to you for the amount / paid Convinced with Allan answers, Gary had shook hands to seal the deal. Allan then took Gary to a local restaurant "to celebrate their deal," where Allan purchased numerous alcoholic beverages for Gary, getting him quite drunk at one point, and finally brought Gary home around 4:00 a.m. One hour later, 20 representatives from the BadCoal Company showed up at Gary's house, at 5:00 a.m., and asked him to sign the following contract: "The BadCoal Company hereby agrees to pay to Professor Gary RM1,500,000 for his recently-inherited 20-acre tract of land in Rawang, and Professor Gary hereby agrees to convey all of his land to the BadCoal Company". Although Gary was not intoxicated, he did have a bad hangover, was perplexed and confused as to the identity of the 20 representatives in his house, and had como difficulty concentrating and generally making sense of the situation. He told BadCoal Company that he already agreed to sell his land to someone named Allan, at which time the BadCoal Company told him that Allan was one of its agents. Surprised by this revelation, Gary said he would need more time to think before signing the contract. He also thought the fact that Allan really worked for a coal company was suspicious, and briefly considered the fact that the BadCoal Company might be purchasing his property for natural resources, but then felt somewhat reassured when he hazily recalled his conversation with Allan about obtaining a refund if the land proved to have natural resources buried beneath its soil. Because Gary was taking a long time to make his decision, all of the 20 representatives for the BadCoal Company began to pressure him, telling him that a deal is a deal, that he had already agreed to sell his property, that he did not want to be known in the community as someone who broke his promises, and that should he refuse to sign the papers, he would be taken to court and sued for breach of contract. Gary did not know what to do, and told the representatives that he would like to get some advice from his attomey first, and began to pick up his phone. One representative from the BadCoal Company then slammed down the phone and said 1 wouldn't do that if I were you." Another representative immediately said "If you know what's best for you. I'd sign it," and opened his blazer to grab a pen from his inside pocket, which he shoved in Gary's direction. When the representative opened his blazer, Gary thought he saw a sharp metal object tucked into the representative's belt. A bit frightened at this point, and still confused by the entire situation, Gary signed the contract, and the representatives from BadCoal Company handed Gary a bank check for RM1,500,000, and left Gary's home. Gary went back to bed and, after catching up on his sleep and waking up around 5:00 p.m., he fully realized what had previously transpired. He immediately emailed Allan and told him to tell the BadCoal Company that our deal is off." Allan told him that this would not be acceptable. You are an associate at a law firm, and Gary comes to you to seek your advice. Please advice TWO (2) claims that will be raised should Gary bring suit against the BadCoal Company [40 Marks) 1. Professor Gary recently inherited a 20-acre tract of land from his grandfather in Rawang, Selangor. Unknown to Gary, who had never visited Rawang, the land contained valuable coal deposits worth RM3,000,000. The BadCoal Company, who knew about the coal deposits, and had made many unsuccessful attempts to purchase the land from Gary's grandfather. One of the agents, Allan, approach Gary and offer to purchase his property for RM1,500,000. Gary explained to Allan that he really had no need for this land, but that he did not want to sell it until he knew the land's market value. At this point, the Allan produced documentation previously prepared by the BadCoal Company showing that 20 acres of land in this portion of Rawang for about RM900,000. This information was generally accurate for tracts of land that did not contain coal or other mineral deposits. When Gary asked Allan why he was willing to pay RM1500,000 for land only worth up to RM900,000, Allan explained that he always fancied this particular piece of land, thought it was very beautiful, and that the additional RM600,000 represented the sentimental value he attached to the land. The following conversation then took place: Gary: Is there anything else about the land I should know about? Allan: Like what? Gary: Well, if the land had gold under it, for example, you'd tell me, right? Allan: Of course I'd tell you if the land had gold under it. In fact, I promise you, if the land turns out to have gold on it, I'll sell it back to you for the amount / paid Convinced with Allan answers, Gary had shook hands to seal the deal. Allan then took Gary to a local restaurant "to celebrate their deal," where Allan purchased numerous alcoholic beverages for Gary, getting him quite drunk at one point, and finally brought Gary home around 4:00 a.m. One hour later, 20 representatives from the BadCoal Company showed up at Gary's house, at 5:00 a.m., and asked him to sign the following contract: "The BadCoal Company hereby agrees to pay to Professor Gary RM1,500,000 for his recently-inherited 20-acre tract of land in Rawang, and Professor Gary hereby agrees to convey all of his land to the BadCoal Company". Although Gary was not intoxicated, he did have a bad hangover, was perplexed and confused as to the identity of the 20 representatives in his house, and had como difficulty concentrating and generally making sense of the situation. He told BadCoal Company that he already agreed to sell his land to someone named Allan, at which time the BadCoal Company told him that Allan was one of its agents. Surprised by this revelation, Gary said he would need more time to think before signing the contract. He also thought the fact that Allan really worked for a coal company was suspicious, and briefly considered the fact that the BadCoal Company might be purchasing his property for natural resources, but then felt somewhat reassured when he hazily recalled his conversation with Allan about obtaining a refund if the land proved to have natural resources buried beneath its soil. Because Gary was taking a long time to make his decision, all of the 20 representatives for the BadCoal Company began to pressure him, telling him that a deal is a deal, that he had already agreed to sell his property, that he did not want to be known in the community as someone who broke his promises, and that should he refuse to sign the papers, he would be taken to court and sued for breach of contract. Gary did not know what to do, and told the representatives that he would like to get some advice from his attomey first, and began to pick up his phone. One representative from the BadCoal Company then slammed down the phone and said 1 wouldn't do that if I were you." Another representative immediately said "If you know what's best for you. I'd sign it," and opened his blazer to grab a pen from his inside pocket, which he shoved in Gary's direction. When the representative opened his blazer, Gary thought he saw a sharp metal object tucked into the representative's belt. A bit frightened at this point, and still confused by the entire situation, Gary signed the contract, and the representatives from BadCoal Company handed Gary a bank check for RM1,500,000, and left Gary's home. Gary went back to bed and, after catching up on his sleep and waking up around 5:00 p.m., he fully realized what had previously transpired. He immediately emailed Allan and told him to tell the BadCoal Company that our deal is off." Allan told him that this would not be acceptable. You are an associate at a law firm, and Gary comes to you to seek your advice. Please advice TWO (2) claims that will be raised should Gary bring suit against the BadCoal Company [40 Marks)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik

10th edition

0-07-794127-6, 978-0-07-79412, 978-0077431808

Students also viewed these Accounting questions