HOSPITALITY AND TOURISM LAW

(DHL2413)

PREPARED BY: RANJINI D/O SAKTHIVEL

MATRIC NO: K1804003

PREPARED FOR: MISS PADMALOSHINI D/O RAVINDRAN

Table of Contents
Discuss the situation where a contract comes under private law 3-4
Elaborate the principal of agency in Malaysia 5-6

References 7

Discuss the situation where a contract comes under private law.

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Private law is a branch of law that deals with the relationship between individuals or
institutions. A contract is a legally binding agreement which recognizes and governs the rights
and duties of the parties to the agreement. An agreement typically involves the exchange of
goods, service, money, or promises of any of those. There are several situations where a
contract comes under private law.

Firstly, contract of business is one of the private law. A contract is a arrangement between two
or more parties that is enforceable by law as binding legal agreement. There are several number
of business relationships involving some type of contractual commitment or obligation such
as, purchaser of goods and services, be a supplier of goods and services, and by having a
partnering agreement with other businesses. Business law consists of many different areas
including the law of corporations and other business organizations, securities law, intellectual
property, employment law and bankruptcy and so on.

Then, contract between family members is also under the private law. Contract between family
members is not enforceable unless the parties intended the contract to create legal relations.
Whether or not the parties intended to create legal relations is determined objectively by
examining the circumstances existing at the time of execution of the contract. However, there
is a general presumption that contracts between family members are not intended to create legal
relations. This presumption derives from experience of life and human nature which shows that
in such circumstances men and women usually do not intend to create legal rights and
obligations, but intend to rely solely on family ties of mutual trust and affection(Jones v
Padavatton,1962).

Furthermore, contract of succession also does falls under the private law. The transfer of rights
and liabilities of a deceased person to his legal representative is called as succession. Law of
succession comprises those legal rules or norms which regulate the devolution of a deceased
person’s estate upon one or more persons. Thus the law of succession is concerned with what
happens to a deceased person’s estate after his/her death. So, the law of succession deals with
the finalization of the debt and assets deceased leaves behind. There are two distinct forms of
contract of succession, the positive contract of succession and the Inheritance renunciation
contract. To make a contract of succession, you should contact an authenticating official such
as a notary. All the parties to a contract of succession must be over the age of majority and the
subsequent amendment or cancellation of a contract of succession requires the consent of all
the parties.

Moreover, commercial contract also under the private law. Commercial law refers to a legally
binding agreement between parties in which they are obligated to do or restrain from doing
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particular things. Commercial contracts can be written, verbal, or implied in a formal or an
informal manner. Commercial contract can include all aspects of a business, such as hiring,
wages, leases, loans and employee safety. A breach of commercial contract takes place when
a contracting party fails to live up to the agreements.

After that, property contract too comes under private law. Property contract are agreements
made during the sale or lease of real estate and other items. Property contract is a real estate
contract between parties for the purchase and sale, exchange, or other conveyance of real
estate. The sale of land is governed by the laws and practices of the jurisdiction in which the
land is located. Property called leasehold estate is actually a rental of real property such as an
apartment, and leases cover such rentals. Freehold real estate are covered by real estate
contracts, including conveying fee simple title, life estates, remainder estates, and
freehold easements. Property contracts are typically bilateral contracts agreed to by two parties
and should have the legal requirements specified by contract law in general and should also
be in writing to be enforceable.

In conclusion, these are the situations where a contract comes under private law and there are
few other situations such as obligations, torts, and so on.

Elaborate the principal of agency in Malaysia

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The concept of an agency is concerned about the relationship between one person, the principal
and another, the agent where a principal entrusts the business to an agent and allows the agent
to act on behalf of the principal in dealing with third parties according to Section 135, Contracts
Act 1950. An agent is defined as a person employed to do any act for another or represent
another in dealings with third person. The person for whom such act is done, or who is so
represented, is called the “principal”. In other words, agency is the relationship which subsists
between the principal and the agent, who has been authorized to act for him or represent him
in dealings with others. The principal must trust that the agent will work according to the terms
of agency agreement and for the benefits of the principal.

The law of agency in Malaysia is governed by Part X of the Contracts Act 1950. section
136,contracts act 1950 any person who is eighteen years old and above and who is of sound
mind may be a principal. As between the principal and third persons, any person may be come
an agent, but persons of unsound mind and who are below 18 years of age are not liable towards
their principal for acts done by them as agents. Like any other contract, a contract of agency
can be expressed or implied for the circumstances and the conduct of the parties. In other words,
the authority of an agent may be expressed given by words spoken or written or implied inferred
from things spoken or written or from the ordinary course of dealings. Not only that, Part X of
Contracts Act 1950 also did not require the appointment of agent or sub-agent to be in
writing.Agency can be created by several ways, firstly by agreement which is express
appointment or by implied agreement. Then an agency can be created by necessity which under
certain circumstances like emergency. Agency can also be done through estoppel by the
principal and by ratification.

The duties of an agency is list down from section 164 to section 178 of the contract act
1950.There are two duties firstly is the duties of an agent towards the principal such as, to obey
principal’s instruction, if there is no instruction, the agent must act according to the customs,
the agent should be careful and diligence and all skills he or she possess in doing the work, to
maintain proper accounts, to communicate with the principal during emergency or difficulty,
and lastly to act in good faith. Secondly, is the duties of the principal towards the agent are
provided in sections 175 to 178 of the contract act. The main duties are, if the agent is guilty
of misconduct, he or she loses right to remuneration, not to willfully prevent or hinder the agent
from earning the commission, and to indemnify and reimburse the agent for lawful acts done
in the exercise of his duties.

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The authority consist of actual authority or apparent or ostensible authority. There is also a
condition where there is a breach of authority by the agent. These can happen in such a way
where there is a named principal, disclosed principal and undisclosed principal. Actual
authority expressly given by the principal orally or in writing or implied from the express
authority given, from the circumstances of the case, custom or usage of trade, and the conduct
of the parties. Apparent authority not expressly given by the principal but which the law
regards the agent as possessing although the principal has not have consented to his exercising
such authority.

Termination of agency can be done in several ways. Firstly, by the act of the parties which is
when the both parties agree that the agency shall be terminated, then the agency shall be
terminated. Secondly, by operation of law which is upon expiry of the period fixed in the
contract, upon the death of either principal or agent, when the agent or principal becomes
insane, when the principal or agent made a bankrupt, when the contract of agency has been
performed and upon the happening of an even which renders the agency unlawful.

It is stated that a law of agency is a relationship created when a person appointed someone else
to act for him as he is not able to act by himself. In a nutshell, these are the principal of agency
in Malaysia and the rules within it.

REFERENCES

Contracts Act 1950

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https://www.lawyerment.com/library/legislation/acts/1950/136/

Termination of agency contract 2012 April

http://www.ybendror.com/NEWS+AND+PUBLICATIONS/Agency+Contract+Law+%28Co
mmercial+Agent+and+Principal%29/

Malaysian Contract Act section 138

http://www.agc.gov.my/agcportal/uploads/files/Publications/LOM/EN/Act%20136.pdf

Contract Act 1950, section 154

http://www.balohpedia.com/2014/04/termination-of-agent.html