QUESTION 2

On 4 March 2014, Samad, an antique collector, entered a contract for the purchase of an antique watch, which was described in good faith, by Khuzairi, the seller, as more than 100 years of age. Samad paid the deposit of RM10 000 out of the total price of RM 50000 and promised to pay the balance within one week. On 6 March 2014, while attending an auction for antiques, Samad met Leha, who told him that she was the person who sold the antique watch which she inherited from her father to Khuzairi. Leha told Samad that the watch is not very old as her father bought the watch on the day that Malaysia got its independence, i.e. on 31 August 1957. Samad was very disappointed with what Leha told him and immediately sent an e-mail to Khuzairi which stated that he intended to terminate the contract which he entered with Khuzairi on the ground that there was a misrepresentation of fact. Samad also wanted to claim back the RM 10 000 of deposit which he has already paid to Khuzairi.

REQUIRED: (The answer must be supported with the relevant cases and act)

i. Identify the validity of the contract between Khuzairi and Samad.