Question 2(b).

b
Explain whether the transaction constitue a valid contract, and what are the right
parties concerned if any:
Baba, a 16 years old student of computer technology contract at sita technology
college made the following transaction and failed to paid for:

A high speed motorbike which cost RM12,500.00 bought from carat motor

Based on the situation above, the transaction for the motorbike no valid because
baba not obey the hire purchase agreement between him as the hirrer and the owner.
One of the details that stated in the In the hirrer purchase agreement contract, time
of each installement to be paid. Based on the details, it see that baba as the hirrer
failed to paid to the owner in the time that been stated. Firstly, under the section 11,
Baba as the hirrer has right to remove the the goods based on the section which he
can apply to the court for the removal of the goods. Secondly in the section 7(2), the
goods under the hire purcahse agreement must be merchantable quality to the hirrer.
It means the good is benefit to baba as the as a student. Take a look in the case Lau
Hee Tiah vs Hargill Engineering Sdn Bhd(1980), which court decided to prove the
goo it is not merchantable quality, the hirrer must show that the goods is no use for
him in any purpose during that situation. In the terms of the owner when the hirrer
had breached the Hire Purchase agreement, the owner of the goods has right to
recover or get back their goods. Section 16(1) stated as the Form Fourth Schedule,
if the hirrer had not paid 2 installemnt in the time and after the 21 days notice been
given for the hirrer to paid the installemnt, the owner can right to recover back the
goods. In case between Phang Brothers Motor Sdn Bhd vs Lee Aik Seng(1978),
state 2 days before 21 days is considered as the possesison was not valid and under
the section17(1) the owner that had already recover the possesion the good cannot
sell th goods to other people without the written consent from the hirrer until
expired of 21 days.