QUESTION 1

Ella went to Modern Home Enterprise (MHE) which sells various household

products. She wanted to get a dining table, a bedroom set, a washing machine, and

a refrigerator. The sales manager of MHE suggested that she pays for the goods by

instalments and for that purpose, signs a hire-purchase agreement. MHE asked Ella

to sign a blank hire-purchase agreement and told her that the details will be filled in

later. When she asked how much she has to pay for the instalments every month

and the duration of the hire-purchase agreement, the sales manager explained to

her verbally. She was asked to pay a minimum deposit of 20% for all the goods. She

signed the agreement and was told that the goods will be delivered the next day. On

the next day, Ella received the goods with a copy of the agreement. She was

surprised to see the amount she has to pay for the monthly instalments and the

duration of hire-purchase stated in the hire-purchase agreement are different than

that explained to her before she signed the agreement. Ella is uncertain as to the

validity of the hire-purchase agreement.

Advise Ella on the above situation by applying the Hire-Purchase Act 1967 and

relevant cases.

(20 marks)

QUESTION 2

Lim and Loh are the only shareholders and directors in Amazing Builders Co

("ABC"), a construction company. ABC contracted with Splendid Supplier Bhd

("SSB"), a supplier of construction materials for the supply of bricks, cement, tiles,

and glass blocks to be used in an upcoming building project. SSB delivered the

goods worth RM500,000 but ABC failed to pay. A week later, Lim received a letter

from SSB demanding payment of RM500,000 to be made, failing which Lim will be

sued for the debt. Meanwhile, Loh has been sued by Bank Pertama to pay a

personal loan which he borrowed. Loh wants to sell off a land which belongs to ABC

to repay his personal loan to the bank. Lim is concerned whether he can be made

personally liable for the debt owing to SSB. He is also upset that Loh wants to sell

the land which belongs to ABC.

Advise Lim on the above situations by applying the Companies Act 2016 and

relevant cases.

(20 marks)