Kassim is the owner of Pets Loving It, a sole proprietorship business, offering a one

stop convenience centre for services such as pets grooming, pet food & pet
accessories supplies for pet lovers in Kuala Lumpur and Selangor. Kassim intends to
expand his business and is looking for a suitable property in Bandar Sungai Short. He
read the following advertisement in a local newspaper:
Bandar Sg Short Affordable shop
lot
for
rent.
Available
immediately. Approx. 2000 sf.
Contact Mr Lee 012-8888888

Before going into the issue whether Mr.Lee is bounded by the proposal to rent the
shop lot to Kassim, we would rather see at the overview of law. What is law ? The
body of enacted or customary rules recognised by a community as binding; Oxford
English Dictionary. Law is a body of rules which are binding on the society and are
enforced by the State. Law regulates the citizens in their relations with the State and
with one another. Every citizen must abide by the rules. Obedience of and compliance
with the laws are usually secured through penalties and sanctions e.g. fines,
imprisonment, community service. There are classification of law between 1) public
law and private law 2) civil law and criminal law
We have learn throughout the business law including private law- between individuals
e.g. contract, tort, company law. Civil law is also referred as private law. The purpose
is to settle disputes between individuals and to provide remedies (correct wrong done
e.g. provide compensation) it is not concerned with punishment. Civil actions are
brought by the wronged party against the wrong doer. Civil actions may be settled or
abandoned before trial. The person who sues is known as the plaintiff (P) and the
person whom he sues or has a claim against is called the defendant (D). The plaintiff
has to prove his case against the defendant on a balance of probabilities. The normal
remedy is an award of damages i.e. a sum of money paid as compensation by the
wrongdoer. But other possible remedies include specific performance and injunction.
According to the law of contract, sec 2(h)- an agreement enforceable by law is a
contract.
Sec 2(g) - an agreement not enforceable by law is void. (Where the agreement has no
legal effect kosong)
If there is a contract, it is legally binding on the parties and the innocent party can
enforce the agreement in a court of law in the event of a breach by the defaulting
party. According to sec 2(a) - a proposal is made when one person signifies to
another his willingness to do or abstain from doing anything, with a view to obtaining
the assent of that other to the act or abstinence For a proposal, there must be a
definite and certain willingness on the part of the proposer to be bound by terms of the
proposal when accepted. Clear and unambiguous words (means to know the proposer
intends to be bound)must be used to evince such a contractual intention on the part of
the proposer; for the case Ho Ah Kim v. Paya Trubong Estate Sdn. Bhd.1
1 (1987) 1 MLJ 143

Sec 2(b) - The proposal is accepted when the person to whom the proposal is made
signifies his assent thereto. Upon such acceptance, an agreement is created as between
the parties. Based on sec 2(c) - the proposal, when accepted, becomes a promise and
the person making the proposal (proposer or offeror) is called the promisor and the
person accepting the proposal (acceptor or offeree) is called the promisee. An
invitation to treat is different from proposal, because what may look like proposal
could only be an invitation to treat- i.e. where an invitation is made for offers which
would be considered. It is an invitation to receive orders. An invitation to treat is a
sort of preliminary communication which occurs between the parties at the stage of
negotiation. It depends on the intention of the parties, where if the parties are intended
to be bound, there is a proposal. If the parties are not intended to be bound, there is
only an invitation to treat. Again, for a proposal, there must be a definite and certain
willingness on the part of the proposer to be bound by the terms of the proposal. Clear
and unambiguous must be used to evince such intention. If not, there is just an
invitation to treat. For the case such as Pharmaceutical Society of Great Britain v.
Boots Cash Chemist2 - display of goods on the shelves of supermarket
The D displayed a poison drugs on the shelves of self service system. Customers
selected their purchases from the shelves, put them into basket and took them to the
cashier desk.
However, the selling of poison drugs by using the above method is contravened the
law.
The D then was charged for offering to sell poison drug without pharmacist
supervision. (S.18 (1) of the Pharmacy & Poison Act 1933. Sale /contract complete at
the cashier desk (when the payment has been made/the cashier scan) not only by
putting the things in the basket {OFFER}
Court of Appeal laid down the principle: The cashier has the right to accept/ reject.
Thus, The display of goods=Invitation to treat. The shop owner had not made an
unlawful sale.
Fisher v. Bell3 display of goods at shop windows price
Coelho v. The Public Services Commission4 advertisement
Harris v. Nickerson5 advertisement
2 (1953) 2 WLR 427. Goods on a display are invitation not an offer; the customer makes an

offer when they take the goods to the register.The cashier is under the shopkeeper's
authority to make acceptance, hence a contract has not been made until the cashier
accepts the purchase.
3 [1960] 3 All ER 731. A shopkeeper displayed a flick-knife in his window. The Restriction of
Offensive Weapons Act 1959 made it an offence to offer such a knife for sale. The
defendant argued that a display of anything in a show window is simply an offer to treat
and this means that, under contract law, it is the customer who makes the offer to buy the
knife. Here the court considered that Parliament knew the technical law, at Common Law,
of the term 'offer'.
4 (1964) M.L.J.12. In this case, the applicant, a Health Inspector under the Town Board,
Tanjong Malim, applied for the post of Assistant Passport Officer in the Federation of Malaya
Government Oversea Missions advertised in the Malay Mail dated 19 February 1957.
Consequently, the applicant was informed that he was accepted and, after undergoing
training, he was posted to the Immigration Office, Kuala Lumpur, where he remained until
December 1958 when he was transferred to the Immigration Office at Johor Bahru.
5 (1893) L.R. 8 Q.B. 286. The defendant advertised that an auction of certain goods would
take place at a stated time and place. The plaintiff travelled to the auction only to find that

The D advertised a sale of certain goods including certain office accessories of a

certain date at a particular place.
The P then travelled to the said location and he discovered that the office accessories
had been withdrawn from the sale.
The P sought damages because the D had breached the contract based on the argument
that the advertisement was an offer and his presence at the sale was an acceptance.
The Court has rejected his claim, because the advertisement is merely an invitation to
treat.
Partridge v. Crittenden6 advertisement
Preston Corp. Sdn Bhd v. Edward Leong & Ors7 request for price quotations
It is also apply to auction sales, based on sec10 Auction sales Act Cap. 81 Federated
Malay States. When the auctioneer calls for bid during an auction sale is an invitation
to treat, because it is for the interested person to make their bid, but the bid becomes
the proposal once the subsequent fall of the hammer by the auctioneer signifies the
acceptance of the bid. When we look at the first paragraph, we know Kassim is the
owner of Pets Loving It, a sole proprietorship business, offering a one stop
convenience centre for services such as pets grooming, pet food & pet accessories
supplies for pet lovers in Kuala Lumpur and Selangor. He intends to expand his
business and is looking for a suitable property in Bandar Sungai Short. He read the
following advertisement in a local newspaper, where there is a shop lot with
approximate 2000 sf. is affordable for rent in Bandar Sungai Short, for those who are
interested can contact with Mr.Lee and the contact number has been given. In this
situation we know that Mr.Lee is advertising his shop lot where it is available for rent
through the local newspaper, in other words he is making the advertisement to a group
of people or the general public or world at large for those who had read the
newspaper, anyone whose interested can rent the shop lot from Mr. Lee. Besides that,
in the advertisement there is only little information about the shop lot such as the
square feet of the shop lot, the location of the shop lot and the contact number of the
shop owner. For the condition of an offer, there must be certain, clear, complete, final
and detail to avoid any doubt. Thus it is merely an invitation from one party to
another party to make an offer. There is no element of offer as sec 2(a) - .with a
view of obtaining the assents of act/ abstinence.

items that he was interested in had been withdrawn. He claimed compensation for breach
of contract, arguing that the advertisement constituted an offer, and his travelling to the
auction, an acceptance by conduct.
6 2 All ER 421. The defendant placed an advert in a classified section of a magazine
offering some bramble finches for sale. S.6 of the Protection of Birds Act 1954 made it an
offence to offer such birds for sale. He was charged and convicted of the offence and
appealed against his conviction.
7 (1982) 2 MLJ 22. This case signifies one of the principles in contract law which is to distinguish offer
frominvitation to treat (ITT) in order to identify existence of a contract between two parties. Asthe quotations
stated by the respondents are merely a supply of information for appellants inthe inquiries of the price of printed
books and their delivery dates. Thus, there was nocontract formed at the time but only was concluded with an
effective communication throughoffer of printing orders by the appellants and acceptance of confirmation by
respondents.

But there is a special case for Carlill v. Carbolic Smoke Ball & Co.8 where the
defendant company advertised in newspaper offering an award of 100 to anyone who
caught influenza after using their smoke ball inhalant as per directions for 2 weeks. It
was stated in the advertisement that the defendant had deposited 1000 with its bank
to show its sincerity. Relying upon this advertisement, the plaintiff bought a smoke
ball, used it as directed but still caught influenza. The plaintiff sued the defendant for
100 and won. The English Court of Appeal decided, inter alia that: - by depositing
1000 with Alliance Bank, the Co. had demonstrated their intention to be legally
bound by the terms of the offer. It was a general offer made to the world at large and
the plaintiff, by using the smoke balls twice daily for over a period of 3 weeks and
still having contracted with influenza, had accepted the offer. The acceptance of the
offer was by conduct a promise made in return for the performance of an act. a
unilateral contract (which mean a one sided agreement whereby you promise to do or
refrain from doing something in return for a performance [not a promise] ) The
requirement for acceptance to be communicated was impliedly waived by the Co.
once you have perform the act, the proposal is accepted (implied)
It applies also in reward cases e.g. an advertisement for the payment of a reward for
the return of lost property or for information leading to arrest and conviction of
certain persons R v Clarke9 Australian government offered a reward for information
leading arrest of persons responsible for the murder of two policeman. X and Clarke
were arrested and charged with murder. During investigation, Clarke gave information
which lead to the arrest of Y (the real culprit). X and Y later convicted for murder and
Clarke was discharged. Clarke then Claimed for the reward. Clarkes claim was
rejected by the court because he has no knowledge with regard to the offer by
Australian government. He gave the info not because he knows about the reward but
to release himself.

8 (1893) 1 Q.B. 256 (C.A.).

9 (1927) 40 C.L.R

After reading the advertisement, he contacted Mr Lee to make an appointment to view

the shop lot. Kassim was satisfied with the shop lot and asked Mr Lee the montly
rental for it. Mr Lee replied that the rental was RM 5,000 per month. Kassim thought
that the rental was too high and asked Mr Lee whether the rental can be reduced. Mr
Lee replied in the negative. After much persuasion from Kassim, Mr Lee finally said,
Since you are so interested in this shop lot, this is my last offer to you, RM 4,800 per
month. Kassim was hesitant to agree with Mr Lee on the rental and he told Mr Lee
that he would think about it. Mr Lee promised to give Kassim one week to decide
whether he wants to rent the shop lot or otherwise.
Whether there is a complete communication of proposal between Kassim and Mr Lee.
According to s4(1) of the Contacts Acts 1950 (CA 1950), the communication of a
proposal is complete when it comes to the knowledge of the person to whom it is
made. In the case of R v. Clarke10, The Australian Government offered a reward for
information leading to an arrest and conviction of persons responsible for the murder
of Two Police officers. X and Clarke were arrested and charged with murder but later
Clarke gave information leading to arrest of Y. X & Y were later convicted and Clarke
claimed for the reward. Clarke failed to claim the reward as the information he gave
was to clear himself and not in reliance of the offer to reward. Unless there is a
communication of the proposal there can be no acceptance to form an agreement.
Therefore, the communication of proposal between Kassim and Mr Lee is complete.
Whether there is a valid contract between Kassim and Mr Lee. S2(h) of the Contacts
Acts 1950 (CA 1950) states that an agreement enforceable by law is a contract. S2(a)
of CA1950 defines proposal as when one person signifies to another his willingness
to do or to abstain from doing anything, with a view to obtaining the assent of that
other to the act of abstinence, he is said to make a proposal. Clear and unambiguous
words must be used to evince such contractual intention on the part of proposer. S2(b)
also state that, when the person to whom the proposal is made signifies his assent
thereto, the proposal is said to be accepted: a proposal, when accepted, becomes a
promise. Upon such acceptance, an agreement is created as between Kassim and Mr
Lee. At first, Mr Lee offered to rent his shop lot at RM5000 per month. Kassim asked
Mr. Lee whether the rental can be reduced. Based on the case of Hyde v. Wrench11,
defendant offer to sell his farm for 1000, plaintiff made an offer of 950 and defendant
did not accept. Plaintiff then accept the 1000 offer but defendant sell it to third party.
Plaintiff sue the defendant because plaintiff think that there is a valid contract between
them but failed. A counter-proposal amounts to a rejection of the original proposal. It
destroys the original proposal which cannot subsequently be revived and accepted.
Hence there is no valid contract between Mr lee and Kassim because Kassim did not
accept the offer. Kassim was hesitant to agree with Mr Lee on the rental and he told
Mr Lee that he would think about it. Mr Lee promised to give Kassim one week to
decide whether he wants to rent the shop lot or otherwise. According to s.6(b), by the
lapse of the time prescribed in the proposal for its acceptance, or, if no time is so
10 (1927) 40 CLR 227
11 (1840) 3 Beav. 334

prescribed, by the lapse of a reasonable time, without communication of the

acceptance. Acceptance must be made within a reasonable time. In the case Fraser v
Everett12, the court held that acceptance for sale of shares had to be made within
reasonable time, taking into view the nature of the mining shares involved, which
fluctuates the nature. Hence there is a valid contract between Kassim and Mr Lee in
this reasonable time. However, if refer back to the counter-proposal, there is no valid
contract between Kassim and Mr Lee.

12 (1889) 4 Ky 512

After two days, Kassim decided to rent the shop lot. He called Mr Lee several times
but no one picked up his calls. He tried to sms (short message service) but there was
no reply by Mr Lee. Unknown to Kassim, Mr Lee had travelled to China for a
business trip. Kassim then decided to write a letter to Mr Lee indicating his intention
to rent the shop lot. He posted his letter to the address stated in the name card given
by Mr Lee. After Mr Lee returned from his trip from China (five days after Kassim
viewed the shop lot), he called Kassim to inform him that he has decided to occupy
the shop lot for his own business. Mr Lee denied having received any letter from
Kassim. But he did admit that he received Kassims sms.
Whether there is a communication of proposal and communication of acceptance
between Kassim and Mr Lee. After 2 days, Kassim decided to rent the shop lot from
Mr Lee. Based on s.4(1), the communication of proposal is complete when it comes to
the knowledge of the person to whom it is made. This means that communication of
proposal of Kassim is complete. He called Mr Lee several times but no one picked up
his calls. He tried to sms (short message service) but there was no reply by Mr Lee.
Mr Lee was having a business trip in China. He denied having received any letter
from Kassim, but he did admit that he received Kassims sms. According to s.4(2)(a),
the communication of an acceptance is complete as against the proposal, when it is
put in a course of transmission to him, so as to be out of the power of the acceptor. In
the case of Ignatius v. Bell13, plaintiff sued for specific performance over his rights to
purchase defendants land. The option was to be exercised on or before 20th August
1912. The parties had contemplated the use of post as means of communication.
Plaintiff sent a notice of acceptance by registered post in Klang on 16th August 1912
but was not delivered until 25th August 1912 because plaintiff was away. The letter
was at the Post Office until picked up by defendant. The court applied Section 4
Contracts Act and held that the option was duly exercised by the plaintiff when the
letter was posted on 16th August 1912. On the other hand, acceptance is complete as
against the acceptor, when it comes to the knowledge of the proposer. While the
proposer is bound upon dispatch of acceptance by the acceptor, the acceptor is not
bound until it was actually received by the proposer. Hence, there is a complete
communication of acceptance between Kassim and Mr Lee since Mr Lee received
Kassims sms about renting his shop lot. Kassim then write a letter to Mr Lee
indicating his intention to rent the shop lot. After Mr Lee returned from his trip from
China (five days after Kassim viewed the shop lot), he called Kassim to inform him
that he has decided to occupy the shop lot for his own business. Mr Lee denied having
received any letter from Kassim. According to Section 4(2)(a), when a
communication is completed by a telegram or a post, states that as against the
proposer, when it is put a course of transmission to him, so as to be out of the power
of the acceptor. Illustration (b) of section 4 stated that B accept As proposal by a letter
sent by post. The communication of acceptance is completed-as against A, when the
letter is posted; as against B, when the letter is received by A. This is also called
13 (1913) 2 FMSLR 115

postal rule. In the case of Entores Ltd v. Miles Far East Corp 14, The proposer is
bound when the offeree posts the letter even though the proposer has no knowledge of
the acceptance. When the letter is posted the acceptor has put in a course of
transmission in such a way that he no longer has any control over it. The transaction
becomes binding irrespective of any delay or disappearance in the course of transit.
Mr Lee is bound when Kassim posted the letter to him, hence the communication of
acceptance is made between them. Another issue of this case is that whether the
revocation by Mr Lee is effective. S6(a) states that a proposal is revoked by the
communication of notice of revocation by the proposer to the other party. S.5(1) also
state that a proposal may be revoked at any time before the communication of its
acceptance is complete as against the proposer, but not afterwards. In the case of
Byrne v Van Tienhoven15, D offered to sell 1000 boxes of tinplates to P. upon receipt
of the offer letter, P sent his acceptance by telegram on 11th October. On 8th October
D wrote to P revoking his offer made on 1st October. The letter of revocation by D
was no effect because at the time the P received the letter and he had already made an
acceptance. Therefore, the revocation by Mr Lee is not effective when the letter of
acceptance by Kassim is posted.

14 (1955) 2 QB 327
15 (1880) 5 CPD 334

Meanwhile, Kassim has purchased a huge consignment of rabbit food for his pet shop
business from Best Pet Food Sdn Bhd (Best Pet Food) at a much lower price
compared to the price offered by the other suppliers. The contract signed by Kassim
and Best Pet Food contained the following clause:
Best Pet Food accepts no legal liability for any damage however caused by any
product supplied by us
Issue : Whether there is consistence course of dealing between Kassim and Best Pet
Food Sdn. Bhd.
Based on case Hollier v Rambler Motors16 where Walter Hollier took his Rambler
car for garage repairs. He had been to this garage on three or four occasions in the
past five years before, and he had usually signed an invoice said the company is not
responsible for damaged cause by fire to customers cars on the premises. He did not
sign the form on this occasion. Unfortunately, some wiring in the garage was faulty.
Rambler Motor Ltd had negligently failed to inspect or maintain it. A fire broke out
and burnt down the garage, with Mr. Holliers car in it. Mr. Hollier sued Rambler
Motors Ltd for the cost of his car. But Rambler claimed that the clause was
incorporated by previous dealings: where Mr. Hollier had read the invoice he would
have seen the terms of business. It was decided that three or four dealings in the past
five years was insufficient to establish a course of dealings, and that the garage was
therefore liable. Same goes to the situation between Kassim and Best Pet Food, where
Kassim has purchased a huge consignment of rabbit food for his pet shop business
from Best Pet Food Sdn Bhd at a much lower price compared to the price offered by
the other suppliers. Based on the first requirement of consistent course of dealing,
there must be a regular course of dealings and a degree of consistency. The situation
has state Kassim buy a huge consignment form Best Pet Food, where it shows Kassim
doesnt had a regular course of dealings and a degree of consistency with Best Pet
Food, if he had regular course of dealings with Best Pet Food, he doesnt have to buy
a huge consignment of rabbit food from Best Pet Food. He will buy such huge
consignment of rabbit from Best Pet Food is because the company has offered at a
much lower price compared to the price offered by the other suppliers. Next, there is
only once that the particular transaction in dispute is entered into by Kassim, and the
situation does not show any previous dealings that are made as same manner as the
particular transaction made by Kassim. It is not as the second requirement stated in
the consistent course of dealing which is the particular transaction in dispute is
entered into the same manner as previous dealings. Even though the contract signed
by Kassim and Best Pet Food contained the following clause: Best Pet Food accepts
no legal liability for any damage however caused by any product supplied by us, but
since it was only once dealings between Kassim and Best Pet Food was in insufficient
to establish a course of dealings and the Best Pet Food there liable. Under the rules of
construction, if the clause is ambiguous the court will use the contra proferentem rule.
Where the clause must be clear and unambiguous. Contra proferentem rule means
16 (1972) 2 QB 71.

against the person who insert the clause. The term will be interpreted in a manner
which is of least advantage of the party who rely on the clause. Base on the case
Wallis, Son and Wells v Pratt and Haynes 17 where Pratt & Haynes (Pratt) sold to
Wallis, Son and Wells (Wallis) a quantity of seed under the description common
English sainfoin The contract provided: sellers give no warranty express or implied
as to growth, description or any other matter Wallis on sold the seeds to others as
common English sainfoin The plants produced by the seed were giant sainfoin ,
an inferior variety. Wallis paid damages to the people to whom he had sold the seeds,
the amount being the difference in value between two crops. Wallis sought to recover
that sum from Pratt as damages for breach of the contract of the seed. It was held that
Pratt-seller could not rely on the exclusion clause which applied to warranties only.
The term breached was a condition that had not been excluded by the exclusion
clause. Effect: clear and unambiguous words are necessary to exclude liability. For
example: however cause, under any circumstances, arising from whatever cause
whatsoever. If Pratt has put the this kind of words (from example) which is
considered as clear and unambiguous into the exclusion clause which is required
under the rules of construction where he had included in the contract, he was not held
liable to the breach of term of the contract.
Whether there is a breach condition or warranty between Kassim and Best Pet Food.
Based on the case of Parker v. South Eastern Railway 18, plaintiff received a paper
ticket which said on its face See back and on the back were a number of printed
conditions, including a clause limiting liability for any package to 10. For the
situation of Kassim and customers, Kassim has put up a notice behind every cash
counter table of his shops, and this is similar to the case Parker v. South Eastern
Railway (1877). The Court held the case of Parker v. South Eastern Railway that even
though P had not read the exemption clause, he was bound by it, as the defendants had
done what was reasonably sufficient to give him notice of its existence. For a normal
condition, a reasonable person would not read the notice behind the counter table,
same as the case of Parker v. South Eastern Railways condition. So, customers who
bought this pet food from Kassims shop can sue Kassim for their losses.
WHAT IS UNFAIR TERM? Unfair Term can defined as a term in a consumer
contract which with regard to all the circumstances causes a significant imbalances in
the rights and obligations of the parties arising under the contract to the detriment of
the consumer.
UNFAIR TERM IN COMSUMER CONTRACT
CONSUMER PROTECTION (AMENDMENT) ACT 2010 has amended the law on
unfair terms in consumer contracts. It took effect in 24 th Feb 2011. Subject to other
laws such as CA 1950, SRA 1950 and SGA 1957; s. 24B CPA 1999.
Section 3. consumer means a person who (a) acquires or uses goods or services of a
kind ordinarily acquired for personal, domestic or household purpose, use or
consumption; and (b) does not require or use the goods or services, or hold himself
17 (1911) AC 394
18 (1877) 2 CPD 416

out as acquiring or using the goods or services, primarily for the purpose of (1)
resupplying them in trade (2) consuming them in the course of a manufacturing
process; or (3) in the case of goods, repairing or treating, in trade, other goods or
fixture or land.
goods means goods which are primarily purchased, used or consumed for personal,
domestic or household purposes, and includes (a) goods attached to, or incorporated
in, any real or personal property; (b) animals, including fish; (c) vessels and vehicles;
(d) utilities; and (e) trees, plants and crops whether on, under or attached to land or
not but does not include choses in action, including negotiable instruments, shares,
debentures and money.
supplier means a person who, in trade(a) supplies goods to a consumer by
transferring the ownership or the possession of the goods under a contract of sale,
exchange, lease, hire or hire-purchase to which that person is a party; or (b) supplies
services to a consumer, and includes (1) where the rights of the supplier have been
transferred by assignment or by operation of law, the person for the time being
entitled to those rights; (2) a financier who has lent money on the security of goods
supplied to a consumer, if the whole of ant part of the price of the goods is to be paid
out of the proceeds of the loan and if the loan was arranged by a person who, in trade,
supplied the goods; (3) a person who , in trade, assigns or procures the assignment of
the goods to a financier to enable the financier to supply those goods, or goods of that
kind , to the consumer; and (4) a person who, in trade, is acting as a agent for another
person where that other person is not supplying in trade.
There are two categories of unfair terms: 1) general procedural unfairness
2) general substantive unfairness
1) GENERAL PROCEDURAL UNFAIRNESS
What happened before the contract, in the conduct of the supplier before the party has
come into the contract. Dealing with unfair terms of contract on the manner in which
the contract is created. Look at the considerations the courts take into account in
determined whether a particular term is procedurally unfair. Based on section 24C(2),
foe the purposes of this section, a court or the Tribunal may take into account the
following circumstances: (a)the knowledge and understanding of the consumer in
relation to the meaning of the terms of the court or their effect; (b) the bargaining
strength of the parties to the contract relative to each other; (c) reasonable standards of
fair dealing; (d) whether or not, prior to or at the time of entering into the contract, the
terms of the contract were subject to negotiation or were part of a standard form
contract; (e) whether or not it was reasonably practicable for the consumer to
negotiate for the alteration of the contract or a term of the contract or to reject the
contract or a term of the contract; (f) whether expressions contained in the contract are
in fine print or are difficult to read or understand; (g)whether or not, even if the
consumer had the competency to enter into the contract based on his or her capacity
and soundness of mind, the consumer g(1)was not reasonably able to protect his or
her own interests or of those whom he or she represented at the time the contract was
entered; or g(2) suffered serious disadvantages in relation to other parties because the
consumer was unable to appreciate adequately the contract or a term of the contract or

its implications by reason of age, sickness, or physical, mental, educational or

linguistic disability, or emotional distress or ignorance of business affairs; (h) whether
or not independent legal or other expert advice was obtained by the consumer who
entered into the contract; (i) the extent, if any, to which the provisions of the contract
or a term of the contract or its legal or practical effect was accurately explained by
any person to the consumer who entered into contract; (j) the conduct of parties who
entered into the contract in relation to similar contracts or courses of dealing between
them; and (k) whether the consumer relied on the skilled, care or advice of the
supplier or a person connected with the supplier in entering into the contract.
2) GENERAL SUBSTANTIVE UNFAIRNESS
After the contract, term that u find inside the contract and looking at the term itself. A
contract or a term of a contract is substantively unfair if the contract or the term of the
contract. Based on section 24D (a) is in itself harsh (unpleasantly severe; stern; cruel);
(b) is oppressive; (burdensome, unjustly harsh, or tyrannical); (c)is unconscionable
(not in accordance with what is just or reasonable) ; (d) excludes or restricts liability
for negligence; or (e) excludes or restricts liability for breach of express or implied
terms of the contract without adequate justification.
Consumer Protection Act (CPA) is an act to provide for the protection of consumers,
the establishment of the National Consumer Advisory Council and the Tribunal for
Consumer Claims, and for matters connected therewith.
Look at the considerations the courts take into account in determined whether a
particular term is substantively unfair. Based on the section 24D(2)(e), whether the
contract or a term of the contract has resulted in a substantially unequal exchange of
monetary values or in a substantive imbalance between the parties. Under CPA it must
be proportion atc (equal and substantial). In section 24D(2)(f), whether the benefits to
be received by the consumer who entered into the contract are manifestly
disproportionate or inappropriate, to his or her circumstances. Supplier must provide
more benefit to consumer because can had done too much of work.
In section 24G(1), In this part, where a court or the Tribunal comes to the
conclusion, having regards to section 24C and 24D that a contract or a term of a
contract is either procedurally or substantively unfair or both, the court or the Tribunal
may declare the contract or the term of the contract as unenforceable or void and the
court may grant judgment, and the Tribunal may make an award as provided for under
section 112 of this Act.
In section 25(1), any person who contravenes any of the provisions of Part 2 and 3
commits an offence and shall on conviction be liable-(a) if such person is not a body
corporate, to a fine not exceeding one hundred thousand ringgit or to imprisonment
for a term not exceeding three years or to both, and for a second or subsequent
offence, to a fine not exceeding two hundred and fifty thousand ringgit or to
imprisonment for a term not exceeding six years or to both.
The difference Between Section 24C and 24D is section 24C deals with the manner
and circumstances in which the contract is created whereas section 24D deals with the
unfairness caused by the term itself disregard on the manner or circumstances in
which the contract is created.

UNFAIR TERMS IN CONSUMER CONTRACTS

If a contract or a term of a contract excludes or restricts liabilities, it is for the
supplier relying on such exclusion or restriction to prove that is not without adequate
justification.
EFFECTS OF UNFAIR TERMS(S.24G)
The court of Consumer Tribunal may declare:
1. That the contract or the term as unenforceable or void, (which provide
simple, speedy and inexpensive justice.)
2.

Sever(separate) the unfair term from the remaining contract so that the
remaining contract is enforceable, lawyer cannot appears in the Consumer
Tribunal.

Based on section 85(Establishment of the Tribunal for Consumer Claims), there shall
be established a tribunal to be known as the Tribunal for Consumer Claims. In
section 97, a consumer may lodge with the Tribunal a claim in the prescribed form
together with the prescribed fee claiming for any loss suffered on any matter
concerning his interests as a consumer under this Act. It only can claim for loss
suffered max claim RM25000.in section 98(1), subject to sections 99 and 100, the
Tribunal shall have jurisdiction to hear consumer claims within the ambit of this Act
including claims in respect of all goods and services for which no redress mechanism
is provided for under any other law and where the total amount in respect of which
an award of the Tribunal is sought does not exceed twenty-five thousand ringgit.
Based on the award of Tribunal, section 112(1) , The Tribunal shall make its award
without delay and where practicable, within sixty days from the first day the hearing
before the Tribunal commences. In 60 days chairman of Tribunal must make
decision, if not within 14 days supplier must comply with an award, otherwise
comment an offence.