Appendix

Q1 Mr. Hassan accepted an offer for a scholarship made by Public Services Department (JPA) to pursue his higher education study in Civil Engineering at Seoul National University, Korea. Mr. Hassan is required to serve with the Government of Malaysia in any field for seven (7) years after completion of his study. He was 17 years and 11 months old when he signed the contract for scholarship as the recipient. The guarantor for this contract was his father, Mr. Ahmad. JPA clearly stated that either the recipient as promisor or the guarantor must pay back the total amount of fees spent on sponsorship if there is a breach of contract. Upon completion of his study, JPA sued Mr. Hassan for breach of contract because he failed to report for work without any reason or notice after graduation. However, Mr Hassan argued that he was a minor during the time of signing the contract, so that the contract was void due to lack of capacity (Refer to Appendix A on Page 2 of 4 to Page 4 of 4 where applicable) Apply the relevant element(s) of contract involved and discuss briefly the existence of the contract according to the relevant section(s) of Contract Act 1950. (7 marks) (6) Assess the significances of the element(s) of contract identified in Q1(a) above with an example of the relevant case law. (10 marks) (c) Although there are restrictions on minor from contracting due to capacity, list FOUR (4) exceptions to this rule. (8 marks) PART III 11 OF CONTRACTS, VOIDABLE CONTRACTS AND VOID AGREEMENTS What agreements are contracts 10. (1) All agreements are contracts if they are made by the free consent of parties competent to contract for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void. (2) Nothing herein contained shall affect any law by which any contract is required to be made in writing or in the presence of witnesses, or any law relating to the registration of documents. Who are competent to contract Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind, and is not disqualified from contracting by any law to which he is subject. What is a sound mind for the purposes of contracting 12. (1) A person is said to be of sound mind for the purpose of making a contract if at the time when he makes it, he is capable of understanding it and of forming a rational judgment as to its effect upon his interests. (2) A person who is usually of unsound mind, but occasionally of sound mind, may make a contract when he is of sound mind. (3) A person who is usually of sound mind, but occasionally of unsound mind, may not make a contract when he is of unsound mind. ILLUSTRATIONS (a) A patient in a mental hospital, who is at intervals of sound mind, may contract during those intervals. (6) A sane man, who is delirious from fever, or who is so drunk that he cannot understand the terms of a contract, or for a rational judgment as to its effect on his interests, cannot contract whilst such delirium or drunkenness lasts. PART VI OF CERTAIN RELATIONS RESEMBLING THOSE CREATED BY CONTRACT Claim for necessaries supplied to person incapable of contracting, or on his account 69. If a person, incapable of entering into a contract, or anyone whom he is legally bound to support, is supplied by another person with necessaries suited to his condition in life, the person who has furnished such supplies is entitled to be reimbursed from the property of such incapable person. Page 3 of 4 person who has furnished such supplies is entitled to be reimbursed from the property of such incapable person. (a) A supplies B, a mentally disordered person, with necessaries suitable to his condition in life. A is entitled to be reimbursed from B's property. (6) A supplies the wife and children of B, a mentally disordered person, with necessaries suitable to their condition in life. A is entitled to be reimbursed from B's property. Page 4 of 4 Q1 Mr. Hassan accepted an offer for a scholarship made by Public Services Department (JPA) to pursue his higher education study in Civil Engineering at Seoul National University, Korea. Mr. Hassan is required to serve with the Government of Malaysia in any field for seven (7) years after completion of his study. He was 17 years and 11 months old when he signed the contract for scholarship as the recipient. The guarantor for this contract was his father, Mr. Ahmad. JPA clearly stated that either the recipient as promisor or the guarantor must pay back the total amount of fees spent on sponsorship if there is a breach of contract. Upon completion of his study, JPA sued Mr. Hassan for breach of contract because he failed to report for work without any reason or notice after graduation. However, Mr Hassan argued that he was a minor during the time of signing the contract, so that the contract was void due to lack of capacity (Refer to Appendix A on Page 2 of 4 to Page 4 of 4 where applicable) Apply the relevant element(s) of contract involved and discuss briefly the existence of the contract according to the relevant section(s) of Contract Act 1950. (7 marks) (6) Assess the significances of the element(s) of contract identified in Q1(a) above with an example of the relevant case law. (10 marks) (c) Although there are restrictions on minor from contracting due to capacity, list FOUR (4) exceptions to this rule. (8 marks) PART III 11 OF CONTRACTS, VOIDABLE CONTRACTS AND VOID AGREEMENTS What agreements are contracts 10. (1) All agreements are contracts if they are made by the free consent of parties competent to contract for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void. (2) Nothing herein contained shall affect any law by which any contract is required to be made in writing or in the presence of witnesses, or any law relating to the registration of documents. Who are competent to contract Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind, and is not disqualified from contracting by any law to which he is subject. What is a sound mind for the purposes of contracting 12. (1) A person is said to be of sound mind for the purpose of making a contract if at the time when he makes it, he is capable of understanding it and of forming a rational judgment as to its effect upon his interests. (2) A person who is usually of unsound mind, but occasionally of sound mind, may make a contract when he is of sound mind. (3) A person who is usually of sound mind, but occasionally of unsound mind, may not make a contract when he is of unsound mind. ILLUSTRATIONS (a) A patient in a mental hospital, who is at intervals of sound mind, may contract during those intervals. (6) A sane man, who is delirious from fever, or who is so drunk that he cannot understand the terms of a contract, or for a rational judgment as to its effect on his interests, cannot contract whilst such delirium or drunkenness lasts. PART VI OF CERTAIN RELATIONS RESEMBLING THOSE CREATED BY CONTRACT Claim for necessaries supplied to person incapable of contracting, or on his account 69. If a person, incapable of entering into a contract, or anyone whom he is legally bound to support, is supplied by another person with necessaries suited to his condition in life, the person who has furnished such supplies is entitled to be reimbursed from the property of such incapable person. Page 3 of 4 person who has furnished such supplies is entitled to be reimbursed from the property of such incapable person. (a) A supplies B, a mentally disordered person, with necessaries suitable to his condition in life. A is entitled to be reimbursed from B's property. (6) A supplies the wife and children of B, a mentally disordered person, with necessaries suitable to their condition in life. A is entitled to be reimbursed from B's property. Page 4 of 4