ASSIGNMENT QUESTIONS

A 191 ASSIGNMENT GLUL 2023 BUSINESS LAW 20%

Format: Language: English; Font Types: Times New Roman, Font size; 12 and 1.5 line spacing.

Question One
Discuss the following situations and advise accordingly based on the relevant provision of the
Contracts Act 1950 and ONE (1) decided case

a. Charlotte is a partner of Medic Care Centre (MCC) with the principal place of business at
No. 6, Jalan Pasar Central, Alor Setar, Kedah. The said business has a branch at No. 15,
Jalan Setapak, Jitra, Kedah. Meanwhile, Louis is a registered medical practitioner,
residing at No. 7, Jalan SS 7, Alor Setar, Kedah. On 21 November 2016 an agreement
entered into between Charlotte and Louis, where Louis had agreed to join Charlotte as a
partner commencing on 21 November 2016 for 3 years from the said date. There was an
express term of the said agreement that Louis as a partner shall not practice as a medical
practitioner by setting up any medical practice himself or as a partner or as an employee
within the radius of 15 km from any of Charlotte’s branches within 3 years after the
Louis has ceased to be a partner of MCC. Later, Louis had stopped working at MCC
since early of September, 2018. In fact, Louis had been practised as a medical
practitioner at Berjaya Klinik situated at No. 10, Jalan Sena, Jitra, Kedah which is of 8
km from Charlotte’s branch of business. Now, Charlotte wants to take legal action
against Louis to restrain him from practised as a medical practitioner at Berjaya Klinik.

Advise Louis.
(10 marks)
b. Leman entered into an agreement on 18 February 2017 to purchase a bungalow double
storey house with a developer, Famous Developer Sdn. Bhd. (FDSB), for RM1 million.
To finance the purchase of the said bungalow house, Leman had applied for and was
granted a term loan facility of RM1 million by Bank Kaya-Raya (BKR). The terms of the
loan were set out, whereby BKR was obligated under the Loan Agreement to make direct
payments, on a progressive basis against an architect’s certificate of completion, to the
FDSB on behalf of Leman. Under Clause 12 of the Loan Agreement stated as follows:
“Notwithstanding anything to the contrary, in no event will the measure of damages
payable by the Bank to the Borrower for any loss or damage incurred by the Borrower
include, nor will the Bank be liable for, any amounts for loss of income or profit or
savings, or any indirect, incidental consequential exemplary punitive or special damages
of the Borrower, even if the Bank had been advised of the possibility of such loss or
damages in advance, and all such loss and damages are expressly disclaimed. However,
either the Bank or the Borrower may refer disputes which may arise to the arbitrator.”

Unfortunately, on 1 February 2019 the purchase of the said bungalow house was
terminated due to the failure of the BKR as the bank to pay one of the progressive
payments to FDSD, the developer under the Sales and Purchase Agreement. Now, Leman
seeks your advice as to the claim for damages suffered as a result of the termination of
the purchase transaction. As for BKR, they are relying on Clause 12 of the Loan
Agreement as an absolute exclusion clause to absolve the bank of all liability for any
damage suffered by Leman.

Advise Leman.
(10 marks)