BBBL2023 Commercial Law Tutorial 8

TUNKU ABDUL RAHMAN UNIVERSITY OF MANAGEMENT AND TECHNOLOGY

BBBL2023 COMMERCIAL LAW

Law of Agency

TUTORIAL 8 WEEK 9

1. Chun Hau owns a retail shop in Kuala Lumpur selling various designer clothes. He
appointed Jonathan as the manager of his shop as well as his personal assistant. Chun Hau
is currently staying in Penang to manage his new retail shop in Georgetown. In his absence,
Chun Hau gives the following instructions to Jonathan:

 To collect monthly rent of RM1,200 from Chun Hau’s tenant, John, who is renting
Chun Hau’s apartment in Taman Melati, Kuala Lumpur.

 To prepare a job vacancy advertisement on JobStreet.com for a manager position for

Chun Hau’s retail shop in Penang. Jonathan is also authorised to short list and arrange
any potential candidate to be interviewed by Chun Hau.

 To purchase three new steamers for ironing clothes costing not more than RM1,000
each.

On 30 April 2020, Jonathan sent a letter of demand to John requesting RM1,500 for April
2020 rental payment. In his letter, Jonathan explained to John that the rent has increased
due to the increasing cost of maintenance of the apartment, which was completely untrue.
Jonathan deposited RM1,200 into Chun Hau’s account and kept the remainder.

Meanwhile, Jonathan worries that he is unable to find any qualified candidate for the
manager position. He then called Aishah, who worked at a recruitment agency to help him
find some job seekers.

In May 2020, Jonathan ordered 3 steamers from Nancy, Jonathan’s sister for the price of
RM1,200 each.

When Chun Hau returned to Kuala Lumpur, he was upset with Jonathan’s acts and refused
to pay his salary. With reference to the Contracts Act 1950 and/or any case law, consider
the following questions:

(a) Advise Chun Hau whether Jonathan has breached his duties as an agent.

(b) Chun Hau is considering terminating Jonathan’s service as his agent. Elaborate how
an agency relationship can be terminated by Chun Hau.

(c) Recommend TWO (2) most appropriate remedies for Chun Hau? Support your
answer with reasons. (May 2021 Exam)

2. What are the various forms of authority of an agent?

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BBBL2023 Commercial Law Tutorial 8

3. Patrick appoints Adi as his agent, instructing Adi to buy a car on his behalf costing not
more than RM100,000. Adi met Chandran, a car dealer, and informed him that he wanted
to buy a car for Patrick, his principal. Then, Chandran sold a car for RM150,000 to Adi.
Chandran demanded the payment of RM150,000 from Patrick, he refused to pay him.
Advise Chandran whether he could claim the amount from Adi instead.

4. Jagan, who operates his own delivery service, was instructed by Max, a fresh vegetable
supplier, to deliver a consignment of high quality fresh salad vegetables from Cameron
Highlands to a luxurious hotel in Singapore. He was told that the goods must reach its
destination not later than 5.00am in the morning. He took the highway heading south and
after about 2 hours he encountered a massive traffic jam due to an overturned truck carrying
highly inflammable products. The highway crew diverted all traffic to use the old road.
This would have prolonged his journey by another 6 hours by which time the vegetables
would have perished under the hot sun. He was also unable to contact Max. Jagan then
decided to sell the vegetables to a local vegetable seller in a nearby town at a very much
lower price. When Max discovered what had happened he was very angry and refused to
pay Jagan’s delivery fees. Advise Jagan under the law of agency as to whether his actions
were correct and whether he can claim his delivery fees.

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