TOPIC 2: LAW OF CONTRACT: ELEMENT 7-FREE CONSENT

By virtue of section 14 of Contracts Act 1950, there is a free consent when a contract is made without an element of...

I. Fraud

II. Coercion

III. Undue Influence

IV. Misrepresentation

• I, II

• I, II, III

• I, II, IV

• I, II, III, IV

In Kesarmal s/o Letchuman Dass v. Valiappa Chettiar [1954] 20 MLJ 119, the court held that a contract executed under the orders of the Sultan, issued in the ominous presence of two Japanese officers during the Japanese Occupation of Malaya was invalid.

From the above case law, the court decided that the consent was not freely given because the consent was caused by…

• fraud

• coercion

• undue influence

• misrepresentation

When a person threat to detain any property to the prejudice of any person whatsoever with the intention of causing any person into an agreement, he is committing a.…

• Fraud

• Mistake

• Coercion

• Misrepresentation

Siti Aliza, a famous singer, has been forced to sing at the Elite Night Club for 12 hours per day. What is the legal effect of the contract ?

• Void

• Valid

• Voidable

• Acceptable

- There is a relation subsisting between the parties.

- One of the parties is in a position to dominate the will of the other.

- One of the parties uses that position to obtain advantages over the other.

From the above statement, the consent is said NOT to be free and the contract between the parties becomes…

• null and void.

• valid and binding contract.

• voidable at the option of default party.

• voidable at the option of innocent party.

Iskandar, a man who suffered from a dangerous disease, was induced by Solomon who was his medical assistant, to agree to pay him RM200,000 for his professional services. Later, Iskandar realized that the sum was unreasonable.

Under the Contracts Act 1950, the contract entered into between Iskandar and Solomon is said to be...

• valid and enforceable by law.

• void and not enforceable by law..

• voidable at the option of Solomon.

• voidable at the option of Iskandar

The following acts are considered as fraud by virtue of section 17, EXCEPT…

• When a proposer concealed a fact he believes to be true.

• When a proposer commits any other act fitted to deceive.

• When a proposer suggests a fact which he knows not true.

• When a proposer made a promise with an intention to perform it.

Airil knows that the house he wants to buy from Borhan is to be expensive in the near future because it is situated at a place where to be developed by the government. Airil did not disclose the fact from Borhan and bought the house in a cheaper price.

From the situation above, Airil has committed an act considered as fraud under section 17 which is …

• acts with the intention to deceit.

• suggest as to a fact which he knows not true.

• conceals a fact which he believes to be true.

• made a promise without intention of performing it.

Poon successfully bid an offer for the purchase of a house in an auction believing that the sale of house is inclusive of a land. What is the effect of the contract made by Poon?

• The contract is not voidable due to the mistake made by Poon.

• The contract is not voidable due to the auctioneer’s mistake of fact.

• The contract is void due to the mistake made by Poon and the auctioneer.

• The contract made by Poon is not voidable due to Poon’s mistake as to the fact.

Ah Chong agrees to buy from Ah Meng a few of buffaloes. It turns out that one of the buffaloes died at the time of the bargain, though neither Ah Chong nor Ah Meng was aware of the fact.

What is the legal effect of the agreement between Ah Chong and Ah Meng?

• The agreement is void because it is a mistake of fact.

• The agreement is not voidable because it is a mistake of law.

• The agreement is voidable at the option of the innocent party.

• The agreement is enforceable by law and legally binding the parties.