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Law of contract
Q.44(a)
Tariq Bin Mostafiz
1317711
“Don't judge each day by the harvest you reap but by the seeds that you
plant.”
Facts
• Saleem is a student from Bangladesh studying at the International Islamic
University, Malaysia. He sought a loan from Krishnamoorthy for the
purpose of helping his family who had suffered untold damage caused by
the recent floods in Bangladesh. At the time of the loan, Krishnamoorthy
asked him whether he is over 18 years old. Saleem replied that he
believed that he is over 18 years old. Thereupon, Krishnamoorthy lends
saleem RM5,000. Saleem was happy to send the money to his family.
• In fact, Saleem had not yet reached 18 years of age at the time of the loan
as he had calculated his age according to the Islamic calendar. Later, when
Krishnamoorty asked for the payment of the loan, Saleem could not repay
since he was penniless. Saleem thereupon seeks legal advice.
• The issue is, Whether Saleem (minor) is enforceable to pay the
loan
Capacity to Contract
• Capacity is the legal ability to enter into a contract.
• Sec 10 of Ca: “All agreements are contracts if they are made by the free
consent of parties competent to contract”
• Sec 11 of CA provides that “a person is said competent to contract, who
is of the age of majority according to the law to which he is subject……
• Sec 2 of the age of Majority says “all persons in Malaysia attain the age
of majority at 18”
• In Malaysia the general rule is that contract or agreement entered into
by a minor is void. A minor can not sue or be sued in contract
• Majority: The age at which parental responsibility for support ends—
usually at age 18.
Exceptions
• Yet, some contracts cannot be voided. Specifically, a minor remains
liable for certain contractual obligations:
1. Taxes
2. Penalties
3. Bank regulations
4. Military
5. Necessaries
Case: Bowling v. Sperry
• Facts: Sixteen year old Larry Bowling (P) purchased a used car from
Sperry (D) for $140. Bowling attempted to return the car to Sperry
after discovering that the main bearing was defective and was
informed that repairs would cost $45-$95. P left the car with D and
mailed a letter disaffirming the contract. P sued D for the return of his
money and the trial court entered judgment for D on the grounds
that the contract was not voidable, because P’s aunt and
grandmother accompanied P when he purchased the car and gave
him the money to purchase it. P appealed.
Issue: Is a purchase contract by a minor
voidable despite the participation of an adult
in the transaction?
• Holding and Rule: Yes. A purchase contract by a minor is voidable despite
the participation of an adult in the transaction.
Others cases of minor:- Mohori Bibee, Tan Hee Juan, Gov. of Malaysia v
Gurcharan Singh
Misrepresentation of age
• Under the Malaysian law, even misrepresentation of age by a minor
will not make a valid contract. The other party can not enforce the
contract.
• In case of Mohamad Syedol Arifin court held: As the
misrepresentation was not fraudulent and even if it was, no action
could be enforced against the respondent as he is still a minor.
• Similar case: Natasan
Conclusion
• Minors lack legal capacity. Therefore, they can create only voidable
contracts.
• The contract between Saleem & Krishnamoorty is void.

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Law of Contract

  • 1. Law of contract Q.44(a) Tariq Bin Mostafiz 1317711 “Don't judge each day by the harvest you reap but by the seeds that you plant.”
  • 2. Facts • Saleem is a student from Bangladesh studying at the International Islamic University, Malaysia. He sought a loan from Krishnamoorthy for the purpose of helping his family who had suffered untold damage caused by the recent floods in Bangladesh. At the time of the loan, Krishnamoorthy asked him whether he is over 18 years old. Saleem replied that he believed that he is over 18 years old. Thereupon, Krishnamoorthy lends saleem RM5,000. Saleem was happy to send the money to his family. • In fact, Saleem had not yet reached 18 years of age at the time of the loan as he had calculated his age according to the Islamic calendar. Later, when Krishnamoorty asked for the payment of the loan, Saleem could not repay since he was penniless. Saleem thereupon seeks legal advice. • The issue is, Whether Saleem (minor) is enforceable to pay the loan
  • 3. Capacity to Contract • Capacity is the legal ability to enter into a contract. • Sec 10 of Ca: “All agreements are contracts if they are made by the free consent of parties competent to contract” • Sec 11 of CA provides that “a person is said competent to contract, who is of the age of majority according to the law to which he is subject…… • Sec 2 of the age of Majority says “all persons in Malaysia attain the age of majority at 18” • In Malaysia the general rule is that contract or agreement entered into by a minor is void. A minor can not sue or be sued in contract • Majority: The age at which parental responsibility for support ends— usually at age 18.
  • 4. Exceptions • Yet, some contracts cannot be voided. Specifically, a minor remains liable for certain contractual obligations: 1. Taxes 2. Penalties 3. Bank regulations 4. Military 5. Necessaries
  • 5. Case: Bowling v. Sperry • Facts: Sixteen year old Larry Bowling (P) purchased a used car from Sperry (D) for $140. Bowling attempted to return the car to Sperry after discovering that the main bearing was defective and was informed that repairs would cost $45-$95. P left the car with D and mailed a letter disaffirming the contract. P sued D for the return of his money and the trial court entered judgment for D on the grounds that the contract was not voidable, because P’s aunt and grandmother accompanied P when he purchased the car and gave him the money to purchase it. P appealed.
  • 6. Issue: Is a purchase contract by a minor voidable despite the participation of an adult in the transaction? • Holding and Rule: Yes. A purchase contract by a minor is voidable despite the participation of an adult in the transaction. Others cases of minor:- Mohori Bibee, Tan Hee Juan, Gov. of Malaysia v Gurcharan Singh
  • 7. Misrepresentation of age • Under the Malaysian law, even misrepresentation of age by a minor will not make a valid contract. The other party can not enforce the contract. • In case of Mohamad Syedol Arifin court held: As the misrepresentation was not fraudulent and even if it was, no action could be enforced against the respondent as he is still a minor. • Similar case: Natasan
  • 8. Conclusion • Minors lack legal capacity. Therefore, they can create only voidable contracts. • The contract between Saleem & Krishnamoorty is void.