Question 1

Annie wanted to sell her collection of books and hence, placed the following online advertisement:

"Are you interested in expanding your book collection? Novels, textbooks and non-fiction books are available for sale at $10 each. The entire collection is available at a special price of $200! First one to call me at 9123-4567 will get a bonus discount. Call me for more details."

Bob saw the advertisement and was the first to call Annie. Over the phone, he told Annie that he wanted to buy the entire collection and could meet her that very day to pass her the money. However, the call quality was very poor and Annie could only discern that he wanted to meet. Nonetheless, she agreed to meet and gave details for the meeting.

Before Annie could meet Bob, she received a call from Charles who stated that he wanted to meet her and buy all the books available for sale. She agreed to meet with him, and gave him the same details for the date, time and venue as those which she has given to Bob.

As Annie was in a rush, she decided to ask David to meet Bob and Charles on her behalf. She told David that he should meet with Bob and Charles and "just negotiate and sell to whoever is willing to pay the higher price".

At the meeting, David told Bob and Charles that the books will be sold to whoever offered the higher price. Charles immediately offered to pay $400 for the entire collection. David agreed but Bob was very upset and claimed that David has no right to change the terms of the offer in the online advertisement.

Explain and discuss whether the agreement entered into by David is valid and binding on Annie. In your analysis, analyse whether David is empowered to act on Annie's behalf at the meeting and whether the four (4) elements of a valid contract are present.

Support your analysis with reasons and relevant case law. (30 marks)

Question 2

Johnson purchased a plot of freehold land and decided to build a three-storey bungalow on it. He engaged HouseProud Pte Ltd ("HouseProud") as the contractor to lay the foundations and build the bungalow.

Johnson wanted to move into the house no later than 1 June, as his whole family was relocating back to Singapore and arriving on 1 June. He stressed the date to Marcus, the general manager of HouseProud as they were negotiating the contract. Hence, the final signed contract stated the completion and hand-over date as "1 June".

By 15 May, it was becoming obvious to Johnson that the bungalow would not be completed by 1 June. When questioned by Johnson, Marcus from HouseProud shrugged his shoulders and stated that it was "impossible to finish by 1 June" and that "it can't be helped". Johnson is so angry that he is thinking of terminating the contract before 1 June.

Analyse the facts above and discuss the most likely basis on which Johnson can discharge the contract. Conclude with your recommendation on what Johnson could do, based on your analysis.

Support your analysis with reasons and relevant case law. (25 marks)

Question 3

Moodz Pte Ltd ("Moodz") is a Singapore-based company that designs, manufactures and sells clothing and accessories incorporating wearable technology. Its products are specifically designed to capture fluctuating stress levels of the wearer and recommend appropriate stress-relieving activities.

Given its success in the Singapore market, Moodz is considering an expansion of its business to Malaysia, China and the United States and has already commenced preliminary discussions with potential distributors in those countries. It is also proposing to include the following clause in its employment contract with its senior management such as the Chief Executive Officer, Head of Sales & Marketing, and Vice-President, Research & Development:

Upon leaving the Company, the Employee will not seek to damage or injure the Company's reputation or to canvass, solicit or procure any of the Company's customers for himself or any other parties.

In the event that the Employee leaves the Company (whether due to his resignation or dismissal), the Employee shall not join any another company or business that is or may be competing with the Company in the field of wearable technology in Singapore or elsewhere.

1.(a)Identify and state the key issue relating to the above clause. Briefly describe two (2) types of contracts in which such a clause is typically found. (6 marks)

2.(b)Analyse the above clause and state your views on whether it is valid and enforceable. Support your analysis with reasons and relevant case law. (19 marks)

Question 4

1.(a)Describe a real-life situation where parties would enter into a contract that includes a liquidated damages clause. (5 marks)

2.(b)Examine the relevant guidelines and factors which the courts would take into consideration when assessing whether a liquidated damages clause would be enforceable. In your answer, you are expected to cite relevant case law. Based on these guidelines and factors, explain the circumstances in which the liquidated damages clause described in the situation in (a) above would be enforceable. (15 marks)