CoercionKesarmal & Anor v. Valliappa Chettiar & Anor Chin Nam Bee Development Sdn Bhd v Tai Kim Choo & Ors C.M. Naested v. The State of Perak Kanhaya Lal v National Bank of India Ltd C.M. Naested v. The State of Perak The plaintiff‟s application for a grant of 23,000 acres of land was approved by defendant. He then paid a certain sum for survey fees calculated upon the area approved as being one block Yet, the land was cut up into 16 blocks, but plaintiff was not informed. Upon demand made by the District Officer the plaintiff's agents paid a further sum for survey fees, the calculation of the amount being based upon the 16 blocks. The plaintiff sued to recover the sum so paid by the agents. “Under these circumstances, it is impossible to consider the payment as a voluntary one. The parties were not on equal terms. I think that the plaintiff is entitled to recover the money as a payment made without consideration, and under coercion, within the meaning of s. 72 [s.73] of the Contract Enactment.” - Kesarmal & Anor v. Valliappa Chettiar & Anor Invalid a transfer executed under the orders of the Sultan, issued in the ominous presence of 2 Japanese officers during the Japanese Occupation of Malaysia. Since the consent was not given voluntarily/consent was not free, the agreement to be voidable at the instance or the consent of the options available so the requirement or option obtained the consent of such. Held: - Held: - Chin Nam Bee Development Sdn Bhd v Tai Kim Choo & Ors The respondents purchase homes off the plan to be constructed by the appellants. Each of the respondents had signed a sale and purchase agreement to purchase a house at $29,500. Subsequently, the respondent was made to pay an additional payment was made to pay an additional $4,000. The court was asked to determine if the additional payment was made voluntarily or under threat by the appellants to cancel the respondent‟s booking for their houses. The appeal dismissed by the High Court which ruled that there was coercion as defined in section 15 of the Contract Act. It further added that the definition in section 15 should only apply for the purpose contained in section 14, and not for the entire Act. Kanhaya Lal v National Bank of India Ltd the word `coercion' as defined under s. 15 of the Indian Contract Act, (Act IX of 1872) should be confined to the interpretation of the word`coercion' as found under s. 14 of the Indian Act, and that the word `coercion' as found in s. 72 of the Indian Contract Act should be given its ordinary meaning. Held: - Undue influence Morris v Burroughs Cooke v Lamotte Morley v Loughnan Lloyds Bank v Bundy Tate v Williamson Satwath Haneem v Hadjee Abdullah Datuk Jaginder Singh and Ors v Tara Rajaratnam Inche Noriah v Shaik Allie Chait Singh v Budin bin Abdullah Letchemy Arumugan Iwn Annamalay Tan Chye Chew v Anor Iwn Eastern Mining & Metals Co Ltd - medical attendant. D. This is because.Later. the transaction was unconscionable. He had to mortgage her farm three times to the bank as security against overdrafts taken by his company. the contract must be set aside because there is trust between the defendant's relationships with T. of the whole life of the dcsd.The appellants and respondent were in a solicitor-client relationship. spiritual adviser. This is because T has referred to the defendant to obtain counsel and by the defendant was not entitled to buy the property without making the disclosure. the bank is not entitled to exercise its right to such collateral. & the gift were not the result of the dcsd‟s own free will. “and may be said to apply to every case in which two persons are so situated.The Court held. the transaction was set aside. his brothers. the trail court also found that the appellants conduct had been fraudulent and exercised its discretion in awarding damages which was upheld by the appellate court. dependant : Llyods Bank Defendant was an old farmer who had little knowledge of the business world.000. Since thay had not discharged that burden. In addition to undue influence. she bought an action seeking to set aside the agreement and the conveyance. . domination of will Datuk Jaginder Singh and Ors v Tara Rajaratnam .The respondent who was the registered proprietor of land. The plaintiff agreed to the conveyance but after her husband‟s death. Morley v Loughnan - Satwath Haneem v Hadjee Abdullah P –beneficiary. doctor. Cooke v Lamotte being used to cover possibility of improper or misuse of influence by guardian and those in loco parentis. Later defendant has buy property T at 7. the failure of the bank to make sure the defendant to seek advice from an independent party cannot deny the assumption that the collateral contract entered into on the basis of the influence not affordable.when the company went bankrupt.Unfair advantages.Bundy claim bek the land n stating he is under influenced. solicitor. the burden was on the appellants to rebut the presumption of undue influence. He has found a defendant who is a lawyer for advice on the sale. for he has took possession. The burden of proof therefore lay on B and C to show that the plaintiff fully understood the transaction and executed the conveyance freely and without being subject to undue influence. Held: - - Held : . Since both B and C failed to discharge the burdem Lloyds Bank v Bundy Plaintiff : Bundry. this situation is not explained to the defendant was completely dependent on advice from the bank. Mr. Inche Noriah v Shaik Allie . Even if the bank knows that the company is experiencing financial difficulties. so to speak . .. A confidential relationship existed between the plaintiff and B and C. claimed that she was induced by the fraud and under influence of the 1st and 2nd appellant to transfer her land to the 2nd appellant. but the effect of that influence and domination‟.Point to be proved is that the other party has to act independently without any influence and fully understand the thing done by him.Morris v Burroughs as a reminder to parents to watch their exercise of authority over their children Tate v Williamson T is a student intends to sell some property to settle the tuition fees. Held : .000 without informing that the actual value of the property is 20. Held: .trustee of the family The plaintiff‟s husband executed a conveyance of property belonging to himself and the plaintiff to B and C. the court to decide. . that one may obtain considerable influence over another” „unnecessary to show existance of special r/ship between dcsd and D. Thus.Defendant claimed that the agreement was signed was witnessed by a lawyer who has explained everything to the plaintiff. He asked the seller how many sheep the land would hold. . The Court held evidence clearly shows that the defendant has committed a fraud on plaintiff. Letchemy Arumugan Iwn Annamalay .Farmer borrowed money from P.According to plaintiff. Life Insurance Corp Tan Chye Chew v Anor Iwn Eastern Mining & Metals Co Ltd although the geological experts have been brought by the respondent to check a second appellant land not included in the contract.Plaintiff who is a female rubber tappers are illiterate request to cancel the sale and purchase agreement has been entered by the defendant who was a developer. Mothoolal v. not opinion 2) Addressed to innocent party 3) Induce the other party to enter into contract Duty of disclosure Keates Iwn Lord Cadogen Goh Chooi Leong v Public Life Assurance Co. the defendant with the help of his solicitor has taken advantage of his ignorance by calling on him to sign some documents in English. In reliance of this statement the claimant purchased the land. The claimant's action was therefore unsuccessful. Plaintiff signed the documents without knowing and realizing that in fact he signed an agreement to sell its land in Port Dickson. the appellant not do any indirection. because the respondent has adequate facilities to conduct its own investigation to determine whether the land is examined. Held: . including in the contract. Life Insurance Corp the Indian Supreme Court in reference to the Explanation to section 19 of the Indian Contract Act stated that “a false representation.Defendant was an illiterate. The seller had not used it as a sheep farm but estimated that it would carry 2. The estimate turned out to be wrong and the claimant brought an action for misrepresentation.Land of D was mortgage and a high interest of 63% is charged. The Privy Council held that the statement was only a statement of opinion and not a statement of fact and therefore not an actionable misrepresentation.Bargain is unconscious bargain therefore contract is voidable. . Held: . whether fraudulent or innocent. not opinion Chait Singh v Budin bin Abdullah . the painted is entitled to cancel the agreement. Representation 1) Representation of certain fact. the court ruled. Ltd.1) Representation of certain fact. Bisset v Wilkinson Bisset v Wilkinson The claimant purchased a piece of farm land to use as a sheep farm. Held: - 2) Induce the other party to enter into contract 3) Induce the other party to enter into contract Mothoolal v. is irrelevant if it has not induced the party to whom it is made to act upon it by entering into the contract”. . a financial company .000 sheep. but in the absence of any evidence that the defendants believed the statement in the prospectus to be untrue Held : .Plaintiff claim for compensation has been denied because the court did not regard this as an indirection in the defendant.Viscount Haldane LC for the House of Lords held that despite Derry v Peek (which had disallowed any claim for misstatements apart from in the tort of deceit) Mr Nocton was liable for his bad advice given the fiduciary relationship between the solicitor and client. Held: - Datuk Jaginder Singh v Tara Rajaratnam The respondent who was the registered proprietor of land.. Kensington. Ltd. This was a bad idea. Mr Nocton advised Lord Ashburton to release part of the mortgage security. has led to the plaintiff that nearly destroyed a house without telling the condition of the plaintiff. because as Mr Nocton in fact knew. had obtained shares in the company. Ltd.000 on Church Street. Lau Hee Teah v Hargill Engineering Sdn Bhd Held: The plaintiff-appellant attempted to rescind an agreement to take a loader on hire-purchase alleging fraudulent misrepresentation. this meant that the security would become insufficient. held that the appellant had failed to discharge the burden of proof required of him on the question of fraud. His solicitor was Mr Nocton. the assured had failed to disclose that he had previously suffered from Tuberculosis. which was authorised by statute to run tramways by animal power. The defendant-appellant had made the alleged misrepresentation falsely and fraudulently and that it had caused the plaintiffrespondent to acquire and subsequently to exercise the rights to purchase. . by steam power. or with the consent of the Board of Trade. which right he transferred for valuable consideration to the former. - Goh Chooi Leong v Public Life Assurance Co. In addition to undue influence. Derry v Peek The defendants were directors of the Plymouth. The number of trees represented was in excess of the number which actually existed on the estate. The plaintiffs. Appellants and respondent were in a solicitor-client relationship. Devonport and District Tramways Co.Lord Ashburton was buying a property for £60. The prospectus issued by the company indicated that steam power would be used. on the strength of the representation in the prospectus. Held: - - . London. Plaintiff-respondent sued the defendant-appellant for damages in respect of an alleged false and fraudulent misrepresentation relating to the number of rubber trees on an estate over which the latter had the right of purchase. the transaction was set aside. Since they had not discharged that burden. Weber v Brown Nocton v Lord Ashburton *is a leading English tort law case concerning professional negligence and the conditions under which a person will be taken to have assumed responsibility for the welfare of another. „It is trite law that a contract of insurance is a contract uberrimae fidei which can be voided for non-disclose of material facts. Held: .The House of Lords that they had not committed the tort of deceit.Keates Iwn Lord Cadogen Plaintiff knew defendant in desperate need of homes. Lord Ashburton alleged the advice was not given in good faith. but the Board of Trade refused its consent. The high Court ruled that there was a deliberate non-disclose when in a life insurance contract. the trial court also found that the appellants conduct had been fraudulent and exercised its discretion in awarding damages which was upheld by the appellate court. and in therefore. the burden was on the appellants to rebut the presumption of undue influence. the transaction was unconscionable. but rather in Mr Nocton's self interest. claimed that she was induced by the fraud and undue influence of the 1st and 2nd appellant to transfer her land to the 2nd appellant. Held : . In dismissing the appeal. and held that the sale agreement was good but had become impossible to perform so that the plaintiff was entitled to recover the purchase money. A then disallowed R to till the land & R claimed the return of the $. Held: - - Hee Cheng v Krishnan Plaintiff entered into a contract with defendantto purchase a house built by the defendant on the ground temporary occupation license. Ahmad b. The defendant and the plaintiff claiming breach of promise of specific performance. Held: - . it would be detrimental to the interests of the children and therefore. The court decides. Udoh & Anor v Ng Aik Chong . in 1930that temporary occupation licenses shall not be transferred. Held: . Illegal promise could be severed from other provisions.3(1) of PCO. or opposed to public policy (a) It is forbidden by law (b) It is of such a nature that if permitted. it would defeat the provisions of relevant laws. P claimed the return of money paid. Udoh & Anor v Ng Aik Chong Murugesan v Krishnasamy & Anor P bought TOL land from dependant who had applied for permanent title. Contract was discovered „vopid‟ only after the proceedings had been started. it would defeat any law Hee Cheng v Krishnan Menaka v Lum Kum Chum Murugesan v Krishnasamy & Anor Ahmad b. the contract is contrary to Rule 41 rules the land. the court ruled that the transaction is void. Therefore. This agreement contravened s. If the purchase is allowed. (d) It involves or implies injury to the person or property of another Syed Ahamed Alhabshee v Puteh binte Sabtu Mohd Ali Jahn b Yusop Sahibjahn & Anor v Zaleha bt Mat Zin & Anor Held: - Syed Ahamed Alhabshee v Puteh binte Sabtu Trustee of the land belonging to a child has agreed to sell the land to the plaintiff. When application was unsuccessful. s. The promise to allow the purchaser to enter the lands and occupy it was an attempt to transfer to him a part of the promisor‟s rights under the TOL and therefore void. They entered into an agreement with the plaintiff as soon as titles were issued. the contact is an attempt to sell and purchase the defendant's rights under temporary occupation license. if the contract is allowed. it would defeat any law (c) It is fraudulent (d) It involves or implies injury to the person or property of another (e) Courts regards it as immoral.66 would apply. Menaka v Lum Kum Chum: The appellant was a registered moneylender and through her attorney she lent money to the respondent on the security of a charge of certain lands belonging to the respondent.R leased padi land from A for 6 years & $1500 was paid therein.S24 Unlawful agreement (a) It is forbidden by law (b) It is of such a nature that if permitted.both were ignorant of the illegality at the time of executing the agreement. Former employer to apply for an injunction from the courts to prevent the defendants from doing so. The plaintiffs-respondents might have breached the by-laws of the Stock Exchange by dealing with an unregistered remisier but such dealing did not make the contract illegal as being opposed to public policy. Held: - (e) Courts regards it as immoral. as guardian failed to seek leave of a Court or a Judge in order to deal with the land. court will protect minor‟s interest. Quit rent was paid by the purchaser's family until 1990 and by the plaintiffs as well since 1984. the defendant opened his firm in the Kota Bahru. The defendants-vendors refused to complete. started and continued to occupy the land until this day. S.The failure to apply for approval was not a breach that went to the root of the contract and the parties had in fact expressly provided fir that in the agreement. whose family. Aroomogum Chitty v Lim Ah Hang Whom the plaintiff to claim back money lent to the defendant to operate a brothel. .I. who were minors then. Held . However. merely entitles them to a claim for damages.The defendants-vendors were therefore not entitled to consider themselves discharged from their obligations under the contract because if the purchaser‟s breach. Theresa Chong v. the plaintiffs‟ father.C had not been sought.Mohd Ali Jahn b Yusop Sahibjahn & Anor v Zaleha bt Mat Zin & Anor In 1948.28 Wrigglesworth v Anthony Wilson P & D agreed that D was restrained from practicing as advocate & solicitor within 5 miles of Kota Bahru town for period of 2 years after the termination of his service contract with P.A contract for the sale of all shares of a company owning land contained a clause to the effect that the purchaser would apply to Foreign Investment Committee for approval of the transaction and should approval within three (3) months from the date of agreement. sold the said land to the defendants‟ father By this agreement the plaintiffs‟ father guaranteed that the plaintiffs. contrary to what was promised after the service. Title to the land and possession thereof were then given to the purchaser. or opposed to public policy Pearce v Brooks Aroomogum Chitty v Lim Ah Hang MAA Holdings v Ng Siew Wah Pearce v Brooks Contract of hire of vichicle for purpose of prostitution MAA Holdings v Ng Siew Wah . would execute the transfer of the land to the purchaser when they attained the age of majority. . court decides a sum of money loaned to conduct business of prostitution cannot be claimed back for the real purpose of the contract is immoral Held : . which at best. the sale is void & the agreement therefore is unenforceable. Restraints of Trade. Kin Khoon & Co The court ruled that the appellant-defendant must settle on a contract though made in contravention of the by-laws of the Stock Exchange which imposed a penalty on the plaintiffs respondents. Minors‟ contract is void. who was registered as guardian in the title of a piece of land. including the defendants. pleading among other things that they were not bound by the agreement as approval of the F. the application for an injunction denied.The Court held. because the agreement is null. Consequently of illegality Ahmad b. she only can recover her money (innocently depositing $). Udoh & Anor v Ng Aik Chong R leased padi land from A for 6 years & $1500 was paid therein. both were ignorant of the illegality at the time of executing the agreement. This agreement contravened s. contract was discovered „void‟ only after the proceedings had been started.3(1) of PCO. only one party unaware of illegality.66 would apply. Held: - Menaka v Lum Kum Chum - Yeap Mooi v Chu Chin Chua & Ors - . A then disallowed R to till the land & R claimed the return of the $. s. Lam Seng Trading Wong Kup Sing v Jeram Rubber Estate Ltd Louinder v Leis Wong Kup Sing v Jeram Rubber Estate Ltd . the contract exists but time cease to be of the essence and become at large. Court stated that a contract will not be released solely on the basis of the influence of frustration itself ("self-induced frustration") - Taylor v.The claimant's action failed. He had performed just over half of the contract. the innocent arty has the right either to rescind the contract.A contract may be rescinded if a key provision in the contract becomes impossible to perform due to no fault of either party. It was agreed that £565 would be payable on completion. Neither party was at fault in the fire.Defendants had failed to give reasonable notice to the plaintiff that intended to terminate the contract after having agreed to n extension of time for performance in a contract for the purchase of a rubber estate. the defendant had thereby accepted partial performance and prevented the claimant from completing the contract. not caused by one of them Ramli Zakaria & Ors v Government of Malaysia Ramli Zakaria & Ors v Government of Malaysia Court held that an agreement containing the provisions of a specific salary is not to be disappointed when the salary is then removed and replaced with a new salary scale.‟ The respondent had wavied his right to rescind the contract and consequently was deemed to have opted tto treat the contract as subsiting.If a person signs a contract to act as a servant of another. the contract contained no reference to the coronation processions. The claimant commenced performance and then ran out of money and was unable to complete. The claimant sought to recover £333 representing the value of the work he had completed. Caldwell P entered into a contract with D where P would pay D 100 pounds/day to use D's music hall to give a concert. The court held that the defendant had no choice but to accept partial performance as he was left with a half completed house on his land. D's music hall was destroyed by fire. D had no option but to accept the building partly erected on his land. Frustration There is Frustration if: a) The essence of frustration is that the extraneous event is outside the control of the parties. but they were .contract rescinded.The claimant agreed to build two houses and stables for the defendant. . the executors of the servant's estate are not liable when the servant dies. He argued that in completing the work himself. or to treat as still subsiting. Held: . If he treats it either expressly or by cobduct as still continuing. a party fails to perform it by the stipulated time. The defendant completed the work himself. After making the agreement but before the first performance. Yeow Kim Pong v Ng Kim Pong Eng Mee Yong & Ors v Letchumanan Sy. Object of contract destroyed/ non-occurrence of a particular event Held: - Krell v Henry D agreed to hire a flat from P for June 26 &27.Discharge of contract Sumpter v Hedges . 1902. . Eastern Plastic Industry v Sy. . Yeow Kim Pong v Ng Kim Pong His lordship stated that if „in a contract in which time is of the essence. P sued D for breach of contract.The excuse that a contract does not have to be enforced upon the destruction of a person or thing is implied by law though it may not be explicit in the contract. Held : . Not frustration if a) Void from the very beginning b) Can be expected to happen / foreseeable c) Collateral object achievable d) Becomes more onerous or costly c) Collateral object achievable Herne Bay Steam Boat v Hutton - Held： . The contract had not been deprived of its sole commercial purpose as it was still possible to perform the days cruise. Berney v Tronoh Mines Ltd Employment contract released by the disappointment when the Japanese invaded Malaya at that time.000 after deduction of all reasonable expenses incurred by the appellants. The defendants were also offering a day‟s cruise for the passengers. The defendant did not use the steamship and the claimant brought an action for the agreed contract price.000 was paid by the respondent to the appellants as earnest money. - Held: . It was found that. In his action the respondent claimed the return of the sum of $5. but the defendant refused to pay damages on the grounds that the natural disasters that have occurred that caused the contract to be frustrated. famous pianist. Khoo Than Sui v Chan Chiau Hee The defendant has contracted to recuse logs from the river Sugut plaintiff to Sandakan. Plaintiff has made a claim for damages for any loss of logs wood. The sum of $5. The Naval Review was not the only commercial purpose of the contract. The Naval Review was cancelled as the King was ill. The processions were cancelled. Robinson v Davison: .Wife D. The defendant argued the contract had become frustrated due to the cancellation of the Naval Review. but could not implement it because of dangerous diseases - The contract was not frustrated. there was not sufficient area to construct the buildings according to the plans. The purpose of the contract was to take paying passengers to view the Naval Review which was part of King Edward VII's coronation celebrations.000 as money paid for a consideration which had failed. b) Can be expected to happen / Foreseeable Khoo Than Sui v Chan Chiau Hee Herne Bay Steam Boat v Hutton The defendant hired out the claimant's steamship. This means that the events that lead to frustration must be something that cannot be expected to be reasonable by both parties. Lee Kin Suan Eng v Chan 5-year lease renewal at all frustrated with the existence of the new enactment that sets the annual renewal. owing to the encroachment of a neighbor‟s house into the lot.The respondent was entitled to the balance of the deposit of $5. Death or incapacitating illness: contract for personal services. for the presentation promised for the concert. but only eleven arrived safely only because of strong riut at sea. Defendants are required to attract eighty two logs.to take place on those days and to pass the flat. 2/3 of the rent had not been paid and the COA held that the P cannot recover it. a) Void from the very beginning Goh Yew Chew v Soh Kian Tee The appellant contractor had undertaken to construct two buildings on land belonging to the respondent employer.The Court held that a construction contract not to be disappointed just because of shortage of labor and construction work becomes more difficult. d) Becomes more onerous or costly Davis Contractor v Fareham UDC Davis Contractor v Fareham UDC . The doctrine of frustration addresses the problem of the frustrating arising after formation.not going to look for an implied term. there is a performance obligation more onerous than conceived to be. There was a labor shortage at the time. since: a) There was adequate labour b) The contract would be frustrated if there was a labour shortage . the contract was not binding. c) Becomes more onerous or costly Davis Contractor v Fareham UDC Davis Contractor v Fareham UDC Davis were contractors . . instead there were two facts to be considered: 1) Nature of the contract itself 2) Circumstances surrounding the contract at the time of its formation. Held : . as is illustrated in the following case: *The Court held that a construction contract not to be disappointed just because of shortage of labor and construction work becomes more difficult. Davis claimed a larger sum of money on a Quantum Mires basis. The distinction may turn on the question of timing.No . the defendant should take precautions to face all eventualities.to build 78 houses over 8 months.Was the contract still a binding one? House of Lords said is this contract frustrated? Due to extraneous events? Originally. Merely. delayed completion of contract – actually nearly 22 months.Held: - The defendants reason that natural disasters that cause the contract to be disappointed not acceptable due tempest that occurred have not reached the stage of natural disasters and should be in such weather conditions. Lord Reed said that the doctrine of frustration was not based on - an implied term notion. no frustration. .