NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

LAW OF CONTRACT

1) INTENTION TO CREATE LEGAL RELATION

(DOMESTIC/MARRIAGE/FAMILY)

In the case of Balfour v. Balfour, Mr. Balfour promised to pay his wife £30 per month while she
stayed in England due to illness, whilst he worked in Ceylon (Sri Lanka). Later, he decided to
remain separated and stopped the payments. Mrs. Balfour sued, claiming his promise was a
binding contract. The court held that agreements between spouses are presumed not to be
legally enforceable unless proven otherwise.

In the case of Pettitt v. Pettitt, a woman bought a house for herself and her husband to live in
and put the property in her name. The husband made improvements to the house and claimed
that his contributions gave him a right to part of the property after their divorce. The court held
that his voluntary improvements did not give him a right to the property.

In the case of Merritt v. Merritt, the husband left his wife to live with another woman. The wife
asked him to make arrangements, and he made oral promises, then wrote and signed an
agreement stating that if she paid the mortgage, he would transfer the house to her. She paid
the mortgage, but he didn’t transfer the house. The court held that she was the sole owner of
the house.

(COMMERCIAL/BUSINESS)

In the case of Carlill v Carbolic Smoke Ball, the company advertised that their smoke ball could
prevent influenza and promised to pay £100 to anyone who used it but still got sick. To show
they were serious, they deposited £1000 in a bank. Carlill bought the product, used it, and still
caught influenza. The company argued that their advertisement was just marketing and not a
real promise. The court held that there is intention to create legal relations between them when
the money has been deposited. Therefore, there was a binding contract between the company
and Carlill.
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

In the case of Rose & Frank Co, an American company signed an agreement with an English
company to be their sole agent in the U.S. However, the document clearly stated that it was
not a formal or legal agreement, so the American company sued for breach of contract. The
court held that there was no intention to create legal relations. Although commercial
agreements are usually presumed to be legally binding, this presumption was rebutted by the
clear wording in the document.

In the case of Winn v Bull, both parties agreed to lease a house, but it depended on a formal
contract being prepared and approved. Since no formal contract was made, the court held that
there was no enforceable contract.

2) CERTAINTY

In the case of Karuppan Chetty, the requirement of certainty was not met when the parties
agreed upon the granting of a lease "at RM35 per month for as long as he likes." The use of
the term ‘for as long as he likes’ had risen the ambiguity. The court held that the agreement
was invalid because the language used by the party is not specific and too vague.

In the case of Idris Meon, the plaintiff transferred two lots of land to the defendant and it was
duly registered, but the land was not developed. The plaintiff asked the court to cancel the
agreement because it was unclear. The court held that the agreement was uncertain as it
lacked clear terms on building plan's submission.

In the case of Phiong Khon, a Chinese woman and an appellant lived together after her
husband died. The appellant said she signed a paper giving him land, but the paper wasn't
clear about the details. The court held that the contract was invalid as the agreement was too
vague and uncertain, so the appellant's claim was rejected.

3) CONSIDERATION

In the case of Re Tan Soh Sim, she was dying and too ill to make a will. Her siblings signed a
document giving up their rights to her property in favour of her adopted children. The court
held that the document was invalid because the phrase 'natural love and affection' under
section 26(a) requires real emotional closeness. Therefore, there was no valid contract.
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

In the case of Henry Agency House, an English company (Plaintiff) sued a Malaysian company
(Defendant) for unpaid payments from Malaysian buyers. The court found that the Defendant
promised to cover the Plaintiff’s losses, but the promise wasn't valid because there was no
proper exchange (consideration) between them. Since the Plaintiff supplied goods based on
the Defendant's suggestion, the court held that the action wasn’t voluntary, making the
Defendant’s promise unenforceable under section 26(b).

In the case of Venkata Chinnaya, a sister promised to pay her brothers Rs 653 annually, even
though they didn’t offer anything in return. However, their mother gave her land on the
condition that she must pay the annuity to her brothers, and the brothers sued the sister when
she didn’t pay. The court held that she was obligated to pay because the land from their mother
counted as valid consideration for her promise.

4) CAPACITY

(NECESSARIES)

In the case of Nash v Inman, a tailor sued an undergraduate student for 11 fancy waistcoats.
The court held that the tailor couldn’t claim payment from the student because he couldn’t
prove that the contract he made with the minor was for necessities.

In the case of Scarborough v Sturzaker, a minor (Sturzaker) rode his bike 15 km to work. He
bought a new bike and traded in his old one, but later tried to cancel the contract. The court
held that the bike was necessary because it was important for his daily commute. Therefore,
the contract was valid.

(SCHOLARSHIP)

In the case of Gurcharan Singh, the Government of Malaysia sued a minor for breaking a
contract to work as a teacher for five years after spending money on his education. The court
held that minors can’t be held to contracts, so the government lost the case. Later, the
Contracts (Amendment) Act 1976 was passed, providing that scholarship agreements with
minors are valid, even if they’re under the age of majority, as stated in Section 4(a).
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

(APPRENTICE)

In the case of Clements, a minor working as a railway porter joined an insurance scheme
where his employers contributed, giving up his right to claim for injury. The court held that the
contract was fair, so it was valid for the minor. However, if the contract is unfair, the minor is
not bound by it.

In the case of Doyle White City Stadium, an underage professional boxer was bound by his
license from the British Boxing Board of Control, which let him earn money from boxing but
required him to follow the rules. The court held that the minor was bound by the contract
because it was fair to him. Similarly, a minor’s contract with a publisher for a ghostwritten
biography was also considered valid.

(MARRIAGE)

In the case of Rajeswary v Balakrishnan, the defendant (a man) promised to marry the plaintiff
but later refused. He argued that the plaintiff, being a minor, couldn’t make such a contract.
However, the court held that marriage contracts are an exception to the general rule, allowing
the plaintiff to sue for the broken promise under Section 4(a) of the Age of Majority Act 1971.
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

LAW OF AGENCY

(DUTIES: A > P)

In the case of Wong Mun Wai, the court held that the defendant failed in his duty as the
plaintiff's agent in two ways. He sold the plaintiff's half-share of land for much less than its
market value and did not inform the plaintiff that he had sold it to his wife. The court held that
the defendant had a duty to act in good faith and protect the plaintiff's interests, not use his
position for personal gain.

(AGENT: MINOR, IMPLIED APPOINTMENT: CONDUCT)

In the case of Chan Yin Tee v. William Jacks, the appellant and Yong (a minor) were registered
as partners. The appellant told the company that he was Yong’s partner. The company
supplied goods to Yong, but they were not paid for. The court held that the appellant was
responsible for Yong’s actions because he had presented Yong as his agent.

(IMPLIED APPOINTMENT: HUSBAND & WIFE)

In the case of Miss Gray v. Cathcart, a wife bought clothes on her husband's credit, but he
refused to pay for them. When the seller sued, the husband showed that he gave his wife an
annual allowance. The court held that the husband was not liable for the bill.

(IMPLIED APPOINTMENT: PARTNERSHIP)

In Rosembaun v. Belson, the court held that when an owner tells an agent to sell their property,
it gives the agent the authority to make a binding contract, which includes the power to sign
the sale agreement.

(CONDITION: AGENT BY RATIFICATION)

In Kelner v Baxter, promoters signed a contract for a company that didn't exist yet. After the
company was formed, it accepted the contract. The court held that the company couldn’t be
held liable because it wasn’t created when the contract was signed. Instead, the promoters
were personally liable because they made the contract before the company existed. Even
though the company accepted it later, the promoters had to take the responsibility.
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

(AGENT BY NECESSITY, NOT FULFILLING THE ELEMENTS OF NECESSITY,

DUTIES P > A)
In the case of Springer, the plaintiff’s tomatoes were delayed due to bad weather and a strike.
Some went bad, and the defendant sold them without communicate with the plaintiff. The court
held that the plaintiff was entitled to damages and there was no agency of necessity because
the defendant failed to do so.

(AGENT BY NECESSITY, FULFILLING THE ELEMENTS OF NECESSITY)

In the case of Swaffield, a railway company delivered the defendant’s horse, but no one was
there to receive it. Unable to contact the defendant, they put the horse in a stable and later
asked him to pay the charges, but he refused. The court held that they acted as an agent of
necessity, so the defendant had to pay for the charges.

(AGENT BY ESTOPPEL)

In the case of Freeman & Lockyer, Mr. Kapoor was appointed to handle a land sale and acted
as the managing director with the board's approval. He hired architects (Mr. Freeman and Mr.
Lockyer) to get planning permission, even though he didn’t have actual authority. The
architects sued for unpaid fees. The court held that the company had to pay because Mr.
Kapoor had apparent authority as managing director.

(TERMINATION BY LAW: FRUSTRATION)

In the case of Stevenson, the court held that the agency was terminated because the principal
became an enemy alien due to war. Once the agency is terminated, the agent can no longer
bind the principal in deals with others and will be personally liable for any contracts made with
third parties.

(TERMINATION BY ACT OF PARTIES: REVOCATION BY P)

In Read v. Anderson, the court held that the defendant could not cancel the plaintiff’s authority
after losing a bet because the bet was placed as instructed. Since the defendant had agreed
to it, he had to reimburse the plaintiff. This case shows that a principal cannot take back
authority to avoid payment once an agent has acted.
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

LAW OF TORTS

1. DEFINITION OF NEGLIGENCE

In the case of Blyth v. Birmingham, the court held that negligence is the omission to do
something that a reasonable man would do, or doing something that a reasonable man would
not do.

2. DOC

In the case of Donoghue v. Stevenson, a woman bought ginger beer from a retailer, but inside
the bottle was a dead snail. After drinking it, her friend became very sick and sued the
manufacturer for negligence. The court held that even though there was no direct contract
between them, the manufacturer still had a duty to ensure the drink was free from harmful
substances, and she is entitled to damages because the manufacturer failed to do so.

(CRITERIA TO FULFIL: REASONABLE FORESEEABILITY)

In the case of Brahma v. Dubb, a caterer was found responsible for a guest’s death at a Sikh
wedding due to an egg allergy. The court held that the caterer was in breach of his duty of
care because he failed to ensure the food did not contain egg, which was forbidden by Sikhism
for the wedding, and some guests could be allergic to it.

(CRITERIA TO FULFIL: SUFFICIENT PROXIMITY)

In the case of Osman v. Ferguson, a teacher became obsessed with a 14-year-old student,
stalking and harassing him despite police reports. He later shot the student and his father; the
student survived, but his father died. The family sued the police for not protecting them. The
court held that while the danger was clear and there was sufficient proximity between the
police and the victims, the police had immunity and could not be sued for failing to prevent the
crime.
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

(CRITERIA TO FULFIL: FAIR, JUST AND REASONABLE)

In the case of McFarlane v. Tayside, a man had a vasectomy, believing it would prevent
pregnancy. However, his wife later became pregnant due to a medical error, and they sued for
the costs of raising the child. The court held that while the pregnancy was unexpected, the joy
of having a healthy child outweighed the financial burden, so they were not entitled to
compensation for raising the child.

3. BODOC

(FACTOR: MAGNITUDE OF RISK)

In the case of Hilder, a man was riding his motorcycle on a road next to an open field where
the defendants allowed children to play football. A ball was kicked into the road, causing the
man to crash. The court held that the defendants were responsible because they did not take
safety measures to protect people passing by.

(FACTOR: IMPORTANCE OF OBJECTIVE TO BE ATTAINED)

In the case of Watt, a fireman was injured when a heavy jack moved while being carried in a
lorry not made for it. The jack was urgently needed to save a trapped woman. The court held
that the fire authorities were not negligent because the risk to Watt was not too high compared
to the need to save a life.

(FACTOR: PRACTICABILITY OF PRECAUTION)

In the case of Latimer v. A.E.C, a factory floor became slippery after a flood. The owners tried
to make it safe, but a worker still got hurt and said that the factory should have closed. The
court held that the risk was not big enough to shut it down and that safety measures should
be reasonable.

(TO PROVE BREACH: RES IPSA LOQUITOR)

In Ward v. Tesco Stores, a customer slipped on spilled yogurt in a Tesco supermarket and got
injured. The court held that Tesco was responsible because they had a duty to keep the store
safe for customers. Since the spill was on the floor and Tesco did not prove they took
reasonable steps to clean it up, they were found negligent and liable for the injury.
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

4. DAMAGE

(CAUSATION)

In the case of Barnett v. Chelsea, a man went to the hospital feeling sick, but the doctor
wrongly sent him home without proper checks. Later, the man died from arsenic poisoning and
his family sued the hospital. The court held that the hospital wasn’t held responsible because
while the hospital was negligent, it didn’t cause his death, and he would have died even with
the right treatment.

(REMOTENESS)

In Chin Keow v. Government of Malaya, a woman with breathing problems went to a

government clinic. The doctor checked her briefly and sent her home without proper treatment.
She later died from respiratory failure, and her family sued for negligence. The court held that
the government responsible because the doctor failed in his duty of care, which directly caused
her death.

(NOVUS ACTOS INTERVENIENS: NATURAL EVENT)

In the case of Carslogie, a Norwegian ship was damaged in a collision caused by Carslogie.
While it was being repaired, a storm caused further damage and delays. The court held that
Carslogie was only responsible for the collision damage, not the extra delays from the storm,
as it was a natural event.

(NOVUS ACTOS INTERVENIENS: 3rd PART ACT)

In the case of Highland Properties, Highland Properties were sued after a landslide caused
the Highland Towers to collapse in 1993, killing residents. The court held that Highland
Properties were at fault because they failed in their duty of care to ensure the buildings' safety.

(NOVUS ACTOS INTERVENIENS: PLAINTIFF ACT)

In the case of McKew, McKew was injured by a faulty staircase built by the company. However,
after the injury, he tried to use the staircase on his own, worsening the injury. The court held
NUR IZZATI NADHIRAH BINTI MUHAMAD SHARIF | 2023655522 | AC1103I

that while the company was negligent, McKew's actions were a new cause of his injury, so the
company was not fully liable.

(PROFESSIONAL NEGLIGENCE: ACCOUNTANT)

In the case of Caparo v. Dickman, Caparo Industries bought shares in Fidelity, thinking Fidelity
was making a profit of £1.3 million, but the accounts were wrong. They actually had lost
£400,000, and Caparo sued for negligence. The court held that Dickman (the accountant) did
not owe them a duty of care due to insufficient proximity between them.