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Introduction

Contract

An agreement having a lawful object entered into voluntarily by two or more

parties, each of whom intends to create one or more legal obligations between

them.

The elements of a contract are:

- Offer

- Acceptance

- Competent persons

- Consideration

- Mutuality of obligation.

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Warranty

An agreement with reference to goods which are the subject of a

contract of sale, but collateral to the main purpose of contract, the

breach of which gives rise to a claim for damages but not a

right to reject the goods and treat the contract as repudiated.

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Damages

An award, typically of money, to be paid to a person as compensation for

loss or injury. The rules for damages can and frequently do vary based on the

type of claim which is presented and the jurisdiction.

Damages can be classified into :

- General Damages

- Special Damages

- Nominal Damages

- Substantial Damages

- Exemplary Damages

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Repudiation

Act, intention, or threat of disowning or rejection of an agreement

already accepted or agreed to. Repudiation amounts to a breach of

contract where the refusal to perform is clear or patent, and where it

goes to the heart of the contract

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I want to baketwo hundred

cake at atime.. But!!!

Where I can

buy it??

ISSUE

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Hey jamal.. U can buyit from me.. It can

reach atemperature of at least

2,000F. And Imselling it to you.. Hurm It sound

great.. Should Ibuy it? I think it agood product.

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OK then Halim.. Iwill buy it from u..

Thank you for

selling me a goodproduct..

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I try to bake the cake..But the oven never reach

the requisitetemperature.

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I am very angry and Iwill filed a suit againstHalim and claimingfor Repudiation of the

contract and Damages.I am sure I will winthe case!!!!!

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FACT OF THE ISSUE

Jamal bought the oven from Halim for

commercial purpose but the oven did not reach

the requisite temperature which is 2000-F.

Based on this issue, Jamal as the innocent party can

treat the issue as repudiated and he also can sue

Halim for the damages because Halim breach the

contract.

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THE LAWS OF ISSUE

Malaysian Laws:

Section 40 Contracts Act 1950

Section 74(3) Contracts Act 1950

Section 76 Contracts Act 1950

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Section 74(3) Contracts Act 1950

Compensation for failure to discharge obligation

resembling those created by contract.

Any person injured by the failure to discharge it, is

entitled to receive the same compensation from the

party in default.

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Section 40 Contracts Act 1950

Effect of refusal of party to perform promise wholly.

When a party to a contract has refused to perform,

or disabled himself from performing, his promise in

its entirety, the promise may put an end to the

contract, unless he has signified, by words or

conduct, his acquiescence in its continuance.

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Section 76 Contracts Act 1950

Party rightfully rescinding contract entitled to

compensation

A person who rightly rescinds a contract is entitled

to compensation for any damage which he has

sustained through the non-fulfillment of the

contract.

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APPLICATION OF LAW

JAMAL HAD EXPRESSLY MADE KNOWN BEFORE

PURCHASING THE OVEN THAT IT SHOULD REACH

A TEMPERATURE OF AT LEAST 2000-F

Section 40 Contracts Act 1950 Jamal gives the condition in their contract.

Halim should be known about the condition because Jamalmade he know.

Halim perform his promise and it cannot fulfill the conditionthat Jamal gives in their contract.

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THE OVEN DID NOT REACH THE REQUISITE

TEMPERATURE WHICH IS 2000-F

Section 74(3) Contracts Act 1950Jamal also have a right to receive

compensation from Halim because of thedamages of the oven and his business.

Jamal is the person injured by Halims failureto fulfill the condition of the contract.

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Section 76 Contracts Act 1950

Jamal has the right to repudiate the contractand receive the compensation of his damages

from Halim.Jamal can filed a suit against Halim claim

about the repudiation of the contract anddamages.

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Conclusion

Jamal as the innocent party have a right to terminate a contract.

Halim cannot fulfill his obligation in the contract. So, Jamal can repudiate the

contract and entitled to compensation.

Jamals damage specific as special damages. Special damages are damages of a

kind which the law will not presume in the innocent partys (plaintiffs) favour,

but which must be specifically pleaded and proved at the trial or arbitration

hearing.

In this case, Jamal loss in his money and he lost his profit because of that

situation. As the conclusion of this case, Jamal can filed a suit against Halim claiming

about the repudiation of the contract and the damages that he sustained

because of the breach of the contract.