ILL T1.docx - Tutorial 1 1(a Ben makes an offer to sell his entire collection of his Cahflow Board Game to Jess for RM100 and his offer shall expire

ILL T1.docx - Tutorial 1 1(a Ben makes an offer to sell his...

This preview shows page 1 - 3 out of 6 pages.

Tutorial 1 1. (a) Ben makes an offer to sell his entire collection of his Cahflow Board Game to Jess for RM100 and his offer shall expire after 7 days. On the 5th day, Ben revokes his offer and informs Jess about his decision. Discuss. Answer : Issue: whether the revocation of Ben offer is lawful or unlawful/ whether Ben can revoke his offer before 7 days. Ben wants to revoke his offer before 7 days. Revocation can be established in two conditions. According to the Contract Act 1950, section 5(1) offer can be revoke at any time before acceptance, lapse or revoke and there must be reasonable notice by the proposer to the other party under section 6(a). This means revocation can be made by Ben at any time before acceptance. Ben has informed Jess on the fifth, so long the offer has not been accepted by Jess. In other words, for the notice of revocation to be effective it must come to the knowledge of the offeree before his acceptance of the offer. Therefore, the revocation of the proposal is valid which means Ben can revoke his offer before Jess accepts the offer although it is before 7 days. On the other hand, if Jess has accepted the offer before the notice of revocation, the revocation is not effective because the agreement is formed. (b) Would your answer be different if Ben has accepted from Jess a RM5 deposit to keep his offer open? Answer: Yes, the answer will be different. Ben cannot revoke his offer due to he has accepted RM5 of deposit from Jess, this becomes a valid option. Besides, it does not fulfil any condition of revocation of proposal. Therefore, the revocation will not be valid in this situation. Option means if the RM5 has been paid by Jess to Ben. An option is a promise to keep the offer open until 7 days. Ben cannot revoke his offer until expiry date.
Image of page 1
2. Consider the following facts:- 1st May – Ali in Alor Setar writes to Muthu in Johor and offers to sell his superbike RX100 for RM15,000 to him. 3rd May – Muthu receives Ali’s letter of offer. In the afternoon of the same day, Muthu posts his acceptance letter together with his cheque for RM15,000 at the Johor post office. 6th May – Thinking that Muthu is not interested, he posts his revocation of his earlier offer to Muthu and on the same day Ali sold his superbike to Ah Chong. 7th May – In the afternoon, Ali receives Muthu’s letter of acceptance together with the said cheque.
Image of page 2
Image of page 3

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture