Guidance to law of contract for F4 MYS

The purpose of this article is not to cover the whole contract law, obviously, but to give a guidance on how to apply the contract knowledge to the application-based question since that is one of the problem areas.

Studying law of contract
This should not have any problem because the things listed in Contract Act 1950 are quite straightforward and there are many cases to illustrate the points. However it is a big topic and it requires a time of at least 2 days to cover the whole contract law relevant to F4 syllabus. What you have to focus is to understand everything, for example in consideration, you know that it is a price that one party (A) paid to another party (B) in order to secure the promise, this promise is made by B and A wants that promise to be legally recognised, therefore he will have to give consideration. You have to strengthen your understanding on the concepts before you are able to tackle the application-based question.

Law of contract covered in F4 MYS
Basically your contract knowledge must cover:
(a) Essential elements of contract.
(b) Terms of the contract including exclusion clause.
(c) Breach of contract and the remedies available including the one provided under Specific Relief Act 1950.

What to write
In the application-based question, you have to write the relevant laws based on the scenario. An example is as follow:
Ali sends a letter to Bali on 30.4.2011 to make offer to buy a car, the letter reached Bali on 1.4.2011. Bali immediately send a letter of acceptance on that day but then Bali received a letter from Ali on 2.4.2011 saying that Bali is an April fool and that the offer is just to trick. Bali wishes to know whether there is a valid contract.
Tips: In this question, immediately you should know that acceptance is being tested (knowing what is being tested is essential, by looking at the story of some cases, you may be familiar). This is an easy question but when you faced a harder question, you should put yourself in the scenario and think what rules apply.
Answer:
The issue here is whether the revocation by Ali is valid.

According to Contract Act 1950, acceptance is when one party who is being offered by another party signifies his assent to the offer. The communication of the acceptance must be complete before the offer is regarded as accepted. Generally there are two ways to complete the communication, either instant (by telephone, orally agree) or by postal.

For the instant method, the communication of acceptance is complete when the promisor hears about the acceptance from the promisee. In postal rule, the acceptance is complete at the moment when promisee posts the letter, revocation received after that time is void, the communication of the acceptance will be completed when the promisor received the letter, then both party is binding to the contract.

In this case, Ali's revocation is received by Bali on 2.4.2011 but the letter of acceptance is sent on 1.4.2011, ie. the date the acceptance is complete. Therefore, Ali's revocation is not valid as he is bound by the agreement at 1.4.2011.

In conclusion, Bali is advised that the agreement will complete when the letter of acceptance reached Ali and both party is bound to the contract thereafter.

The length of answer depends on how much marks the examiner will give, this answer should worth around 6-8 marks, you should always think that at least 1 point is needed for 1 mark. The important points and explanations must be there in order to get good marks in exam.

Cases
There are a number of cases in contract law, it is quite useful to remember some of them because quoting case in the answer of the question can really help you to gain about 1 mark. You only need to remember the case name, not the story, so try to remember some easy names such as Fisher v Bell, Felthouse v Bindley, Hyde v Wrench and so on, although the more you remember, the more you are in an advantage.

Conclusion
Law of contract is actually an interesting topic, I will suggest you not to remember the section numbers if you have tried because there will be no mark given for section numbers. Understand the rules, the deepest the understanding, the more question you can answer.