SEMESTER FINAL EXAMINATION

DIPLOMA IN BUSINESS MANAGEMENT

MODULE : BUSINESS LAW

EXAM DATE : 15 / 07 / 2011

EXAM TIME : 8:30 – 11:30a.m.

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 Read the instructions carefully before answering any questions.

INSTRUCTIONS TO CANDIDATES

Answer any FIVE questions. ( Total 100 marks )

This paper consists of THREE printed pages only.

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Cheating is a serious offence. Any candidates found cheating will be given an

automatic “F” for all subjects enrolled for the semester.

Reg No. : ___________________________

Name : ________________________

(LHL/S1/2011)

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 Answer any FIVE questions .

1. Explain the following

(a) Discharge a contract (5 marks)

(b) Unilateral contract (5 marks)

(c) Express and implied terms (5 marks)

(d) Past consideration is not a good consideration (5 marks)

2. Jack, a self employed tax consultant, arranged to give his car for servicing to Quick
Garage Ltd on Wednesday. On Wednesday afternoon, Jack took his car and went to
meet his client. Due to a problem in the engine, Jack had an accident and he was
severely injured. After proper inspection of the car, a problem in the engine was
discovered. This was due to the carelessness of the company mechanic during
servicing of the car.

As a result of the accident, Jack could not work for four months and suffered a loss of
$20,000. He also did not manage to meet his clients, suffering a further loss of
$50,000.

Advise Quick Garage Ltd as to their liability in the contract. (20 marks)

3. (a) Offer can be terminated by revocation and rejection of the original offer.
Explain when an offer may be terminated by revocation. (5 marks)

(b) Consideration must be sufficient that it must be something the law recognizes
as consideration. Explain. (15 marks)

4. (a) Zainal gets on a train without a ticket. He buys one on the train and the
conductor informs him that the train has had to change destinations. At the
back of the ticket, there is an exclusion clause excluding the Malaysia Rail
from liability for any resulting breach of the contract. These can be seen at
any railway station.
(i) What is an exclusion clause? (5 marks)

(ii) What are the conditions for an exclusion clause to be effective in a

unsigned document? (5 marks)

(iii) Is the exclusion clause effectively excluding the Malaysia Rail from
liability for any resulting breach of the contract? (10 marks)

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5. There are different remedies available to the injured party when the contract is
breached. State and explain the remedies available for breach of contract.
(20 marks)

6. (a) A contract is discharged by performance only when both parties have

compiled fully and exactly with the terms of the contract. Explain the
exceptions to this general rule of discharging a contract by performance.
(15 marks)

(b) Sony Music Records, a famous music company has engaged JJ to sing in
series of concerts in conjunction with Merdeka day celebration. Before the
concert begins, JJ was ill and was incapable of appearing in the series of
concert. Will the contract be discharged by frustration? (5 marks)

7. (a) The general rule for transfer of title (nemo dat rule) is governed under S21.
Explain nemo dat rule. (10 marks)

(b) What is sale by description What are the implied conditions as to sale by
description? (10 marks)