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(A) According to S11 of CA, that one who is a sound mind is competent to enter into a contract.
S12(1) CA provides a person is said to be sound mind for the purpose of making a contract, when
he makes it, he is capable of understanding it and of forming a rational judgement. From this
situation, even though Seow Seow is already 30 years old, because he is suffering from rare
disease, thus he can’t make the logical choices and think logically due to his behavior like a child
so this contract is revoked because of mental disorder of the offeror, Seow Seow.

(B) According to S30 of CA, the term of an agreement must be certain. An agreement which is
uncertain is void. The Karuppan Chetty v Suah Thian shows there is no contract available while
the requirement of certainty is not met. In this following situation, the lessor and lessee did mention
properly and clearly in the contract that period of the lease. This shows the contract is legal.

(C) According to S7 (b) CA, the acceptance must be expressed in some usual and reasonable
manner, unless Woody prescribes the manner in which it is to be accepted. In addition, according
to Fraser v Everett, Woody cannot prescribe silence as a manner of acceptance.

(D) A contract to purchase a piece of land from Kiam Siap at the price of RM 400,000 when the
market price is RM 500,000. This question is on consideration need not be adequate. In explanation
2 to S26 of CA, provides that agreement is not void merely because the consideration is inadequate.
It is similar to illustration (f) to S26 CA – A agrees to sell a horse worth RM1000 for RM10. The
agreement is a contract although the consideration is inadequate.

(E) 1. Discharge by agreement. The general rule is that parties to a contract must perform it in
accordance with its terms. However, the contracting parties may, by agreement, terminate the
contract. By Section 63 of Contracts Act 1950 that the original contract need not be performed if
the parties to the contract agree to substitute a new contract for it or rescind it or alter it. Then, by
Section 64 of Contract Act 1950 says it allows every promise to dispense with or remit, either

wholly or in part, the performance of the promise made to him. Also, it extends the time for its
performance or to accept, instead of its performance, any satisfaction he thinks fit.
2. Discharge by breach. Contracts may be terminated as a result of the offeror or offeree’s failure
to fulfil his obligations. The innocent party is discharged from further obligations. The promisor
must perform or tender performance of his promise. Where he has failed to do so, the promise may
be entitled to be discharged from future obligations under the contract.

(F) According S2(a), when a person signifies to his willingness to do or to abstain from doing
anything, with a view to obtaining the assent of that other to act or abstinence, she is said to make
a proposal. In the question, Demi offered to sell her car to Bruce for RM180,000 this situation is
an offer. Hyde v Wrench shows that when an acceptance which is a new term can become counter
offer, and counter offer will destroy the original offer like Bruce asked Demi whether she can sell
the car for RM160,000, then he destroyed Demi’s original offer.

(G) A contract is frustrated when there is a charge in the circumstances., which a contract is legally
or physically impossible of performance. This is S57(1) CA because an agreement to do an act
impossible itself is void. It is similar to illustration (a) A agrees with B to discover treasure by
magic. The agreement is void.

(H) In this question is on accord and satisfaction. It is a part payment may discharge an obligation.
Payment of a smaller sum is a satisfaction of an obligation to pay a larger sum. Illustration (b) to
S64 CA 1950 – A owes B $5000, A pays B $2000, and B accepts in satisfaction of his claims on
A. The whole debts are discharged. So. Azmin agreed Bakar can only pay RM5,000 as full
settlement of whole debt.

(I) The first remedies that are available to innocent party for breach of contract is damages
(Monetary compensation). In S74 (1) CA, it naturally arose or within parties’ knowledge. S75 CA,
reasonable compensation regardless of whether there is a penalty clause or not. According to

Wearne Brothers v Jackson, plaintiff is required to prove actual loss. Kebatasan Timber v Chong
Fah Shing – the party seeking damages is under a duty to mitigate the losses. The second remedies
is injunction that an order of the court that prevents/ stops the defendant from doing or continuing
to do something. There are 2 types of injuction: temporary or interlocutory injuction or perpetual
injucton. Temporary injuction and perpetual injuction can be in the form of mandatory or
prohibitory injuction. Injuction is an equitable remedy. It can be varied or dissolved by the court

(J) This question is on past consideration is good consideration, S2(d)CA. According to Illustration
(c) to S26CA, A finds B’s purse and gives it to him. B promises to give A RM50. This is a contract.
The act done at the request of Michelle, Rachel made subsequent to the doing of that act like
rewarded. But Rachel haven’t done her agree, Michelle dissatisfied and he can sue her.