GROUP ASSIGNMENT

TECHNOLOGY PARK MALAYSIA

ABUS011-4-2-LFBUS

LEGAL FRAMEWORK OF BUSINESS

UCDF1805BSA/BIT

HAND OUT DATE: 23 OCTOBER 2019

HAND IN DATE: 18 NOVEMBER 2019

WEIGHTAGE: 40%

INSTRUCTIONS TO CANDIDATES:

1 Submit your assignment at the administrative counter.

2 Students are advised to underpin their answers with the use of references (cited
using the Harvard Name System of Referencing).

3 Late submission will be awarded zero (0) unless Extenuating Circumstances (EC)
are upheld.

4 Cases of plagiarism will be penalized.

5 The assignment should be bound in an appropriate style (comb bound or

stapled).

6 Where the assignment should be submitted in both hardcopy and softcopy, the
softcopy of the written assignment and source code (where appropriate) should
be on a CD in an envelope / CD cover and attached to the hardcopy.

7 You must obtain 50% overall to pass this module.

     
Issue
Identification of the case under frustration and revocation and whether Chris may effectively
claim against Anna under frustration acceptance by concerned the revocation of the offer in
which postal rule.. Under the postal rule, although an acceptance if effective upon posting. A
revocation is only effective upon receipt. (Netk.net.au, 2019)

Law References and Previous cases

Postal Rule
According to Duhaime’s, a rule of contract law that makes an exception to the general rule
that an acceptance is only created when communicated directly to the offeror.

1. In Byrne & Co v Leon Van Tienhoven & Co (1880) 5 CPD 344 is a leading English
contract law case on the issue of revocation in relation to the postal rule.
Facts
On October 1st, Van Tienhoven mailed a proposal to sell 1000 boxes of tin plates to
Byrne at a fixed price. On October 8th, Van Tienhoven mailed a revocation of offer,
however that revocation was not received until the 20th. In the interim, on October
11th, Byrne received the original offer and accepted by telegram and turned around
and resold the merchandise to a third party on the 15th. Byrne brought an action for
non-performance.

Held
The plaintiff has won the case

2. In Adams V Lindsell (1818) 106 ER 250,

Facts
The defendant wrote to the claimant offering to sell them some wool and asking for a
reply 'in the course of post'. The letter was delayed in the post. On receiving the letter
the claimant posted a letter of acceptance the same day. However, due to the delay the
defendant's had assumed the claimant was not interested in the wool and sold it on to
a third party. The claimant sued for breach of contract.

Held
There was a valid contract which came in to existence the moment the letter acceptance was
place in the post box (E-lawresources.co.uk, 2019)
Frustration

Case Related

The case of Paradine v Jane[1647]EWHC KB J5

Facts

This case shows the authentic line that the courts took towards a disappointment of direction
in contract ; here, the courts held that where land under rent to the respondent had been
attacked by Royalist powers, he was still under commitment to pay lease to the land
proprietor. It was not until the situation of Taylor v Caldwell that a teaching of
disappointment was officially perceived, mitigating the potential cruelty of past choices.
Here, two parties contracted on the contract of a music corridor, for the exhibition of shows.
Resulting to contracting, yet preceding the dates of contract, the music corridor burned to the
ground. It was held the agreement was difficult to perform; Judge Blackburn expressed that
the outright risk set out in Paradine v Jane would not make a difference in the moment case,
as there was an inferred condition that the music corridor would be in presence at the date of
the arranged shows. This hosted the impact of pardoning the gatherings from the agreement.

Held

As being held in the contract law this had the effect of excusing both parties from the test .
Application of law

Acceptance And revocation

In the current open Chris V Anna case, which had a issue of whether the contract formed
between Chris (Plaintiff) and Anna (Defendant) is valid or Null.

In accordance to the contract act of 1950 under section 4 (2) (b). Since according to the postal
rule once you hand over the letter to the proper Postal authorities the offer made by in this
case Chris to Anna was accepted by Anna, at this point a contract has been created between
both parties since both accept the conditions. However, in this case since a tragedy befell
Anna due to which her house burnt down. This gives Anna the defendant the right to send
another letter to Chris with a receipt from the postal office showing that the letter of
termination has already been forwarded. Since their seems to be a valid reason for the
cancellation of the contract and Chris receives two letters from Anna at the same time, then
Chris must take the Latest issued letter into account. Which is this case seems to be the letter
of termination of the contract and to act upon it accordingly. According to this the contract
can be proven as Null. (Netk.net.au, 2019)

However, in the of chance that the letters sent by Anna are received by Chris at different
times and he starts to make immediate preparation. This could mean that the contract might
be void but he might have the right to sue the postal company itself since they were supposed
to deliver both letters at the same time.
Claim & Discharge by frustration

The doctrine of frustration is set in Sec 57(2) where a contract to do an act which after the
contract is made becomes impossible, or by some reason event which the promisor could not
prevent, becomes void when the act becomes impossible or unlawful. Such as the case of
Paradine v Jane[1647]EWHC KB J5 as a reference of similar case.

We may use this statement to identify that the case between Chris and Anna is indeed a
plausible case of frustration in which Chris seeks to claim compensation from Anna.
Logically we may also assume Chris has sustained some form of cost to pursue the contract
to resort to litigation.

In relation to the case, we may apply Sec 57(3) which provides the doctrine for compensation
through non performance of act known to be impossible or unlawful, which is where one
person has promised to do something which he knew, or, with reasonable diligence, might
have known, and which the promisee did not know, to be impossible or unlawful, the
promisor must make compensation to the promisee for any loss which the promisee sustains
through the non-performance of the promise. In this we may only presume that Chris may
claim against Anna for compensation.

In relation to this, due to inadequacies and vagueness in this. Malaysia adhered to

developments on English Law on frustration by re-enacting substantially the 1943 Act in
Sections 15 & 16 of the Civil Law Act 1956.

The sections basically clarify any party that has spent some money in pursuance of
contractual obligations may claim these expenses from the other side, if the court thinks it’s
fair. 

Through this we may identify if in pursuance of fulfilling the contract Chris does indeed have
a right to claim against Anna.
Conclusion
In conclusion, Chris sues Anna to claim monetary compensation or specific performance for
sudden discharge and impossibility when he received a letter of acceptance and revocation. In
this case, Chris may claim against and Anna in pursuance of the contract under claims against
frustration. Before claiming compensation, Chris must state the cost incurred and the
judiciary will decide upon the appropriate amount based on the cost incurred. Thus, Chris
may claim but the amount will be deemed by the judge.

(1154 words)
References

Asklegal.my. (2018). If a freak accident makes you break a contract, can you get sued under
M'sian law?. [online] Available at: https://asklegal.my/p/frustrated-contracts-law-malaysia-
events-performance-impossible-illegal [Accessed 1 Nov. 2019].
Duhaime.org. (2019). Postal Rule Definition. [online] Available at:
http://www.duhaime.org/LegalDictionary/P/PostalRule.aspx [Accessed 2 Nov. 2019].

E-lawresources.co.uk. (2019). Adams v Lindsell. [online] Available at: http://www.e-

lawresources.co.uk/Adams-v-Lindsell.php [Accessed 2 Nov. 2019].

LawTeacher. November 2013. Unforeseen Events May Occur Which Create Obstacles.
[online]. Available from:
https://www.lawteacher.net/free-law-essays/contract-law/unforeseen-events-may-occur-
which-create-obstacles-contract-law-essay.php?vref=1 [Accessed 1 November 2019].

Murthi, M., Yang, P., Ibrahim bin K. Moideen., Yap, T. and Thuraisingham, M.
(1986). Contracts Act 1950 (Act 136) ; Contracts (Amendment) Act 1976 (Act A 329) with
respect to scholarship agreements. Kuala Lumpur: Professional Law Book Publishers.

Netk.net.au. (2019). Contract Law lecture - Termination of Offer. [online] Available at:
http://netk.net.au/Contract/06Termination.asp [Accessed 2 Nov. 2019].

O'Sullivan, J. and Hilliard, J. (n.d.). The law of contract.

 PEER ASSESSMENT FORM

Name of Group Member :

Name of Assessor :

Criteria Very Poor Average Good Excellent

Poor
1 Well-prepared for group
discussion/meetings

2 Contribute effectively to group

discussion/meetings

3 Involvement in research and

information gathering

4 Collaboration with other team

members

5 Acts in a professional manner

6 Attendance at meetings

Assessors’ remarks:
Note:
1- One assessment form will represent one group member. In a group of 4 members, 4
assessment forms must be completed, one for each member.
2- The assessor must make some remarks regarding the team member’s performance,
especially if the member’s contribution is marked “Excellent” across all criteria.

GROUP ACTIVITY REPORT

Date Brief details of activity Team members involved

23 Oct First meeting to delegate tasks & discuss ALL
2019 preliminary legal issues
2 Nov 2019 Research references & present previous cases ALL
3 Nov 2019 First Submission of everyone’s part & ALL
Checking
4 Nov 2019 Developed first draft of answer ALL
16 Nov Research carried out on “revocation of offer”, Vung Yi Wei
2019 and previous case on Frustration
16 Nov Developed final compilation Brendan, Firda
2019
 Brendan Nur Vung Muhammad Firda
Wong Najmah
Name Yi Wei Sheraz
TP05175 TP050617
TP051348 TP051027 TP050409
3
Activities
Issue, Law & Previous
cases on Revocation and
√
Postal Rule
Law & Previous Case on
Frustration
√
Application of law on
Revocation and Postal
√
Rule
Application of law on
Frustration
√
Conclusion
√
Research on topics on
Revocation & Postal rule
√ √ √
Research on topics on
Frustration
√
Compilation of legal
arguments
√ √