Megat Mohd Shauqi bin Megat YahyaNur Hidayahtul Nabihah binti Manas

Neem entered into an agreement with Mid (Importers) Sdn Bhd to purchase 100 tons of cotton on board a ship, The Nasaq. The purchase price was

RM 250 000.00 and Neem paid RM25 000.00 as a deposit. The next day, following a collision at sea,

The Nasaq sank along with the cotton. Neem intends to sue Mid (Importers) Sdn Bhd for breach

of contract and recover the deposit of RM 25000.00.

Type of Agreement:

Sale and purchase of goods (100 tons of cotton)

Parties:

Neem [Purchaser]Mid (Importers) Sdn Bhd [Vendor]

Issue:

Whether Neem, the purchaser can sue Mid (Importers) Sdn Bhd, the

vendor for breach of contract under sale and purchase of goods

agreement.

Terms of Contract:

-Purchase 100 tons of cotton on board a ship, The Nasaq

-Purchase price is RM 250 000.00-Deposit RM 25 000.00

Express or Implied:

-Section 9 of Contract Act 1950Promises are made in words is said to

be express,Promises made other than in words is

said to be implied.

Express Term

• Term or Representation

• Condition or Warranty

Implied Term

• Business Efficacy

Term or Representation:

-Importance of the statementImportance=Term

Less importance=RepresentationBannerman v White

-Special skills/knowledgeMaker of the statement had special knowledge than

other party, the statement=TermEsso Petroleum Co Ltd v Mardon

Condition or Warranty:

-Section 12 (2) of SOGA 1957Condition=Major term which is vital to

the main purpose of the contractPoussard v Spiers

-Section 12 (3) of SOGA 1957Warranty=A less important term.

Bettini v Gye

Terms Implied by Courts:

-Business EfficacyTerm sought to be implied is necessary to give business efficacy to the transaction, that is, to enable the transaction to be

efficient or to produce the effect that was intended.

The Moorcock

Breach:

-Breach of conditionThe vendor, Mid (Importers) Sdn Bhd failed to deliver 100 tons of cotton to Neem as the ship,

The Nasaq sank due to collision at the sea.

Remedy:

-Rescind the contract-Damages