Questions on Business Law

This Maksim nemo dat quod non habet state no one can give possession at something that he did not own. Apart from that too, it also meant if product bought from one who is not owner that is real or he never got truth from owner to sell, so buyer will not get title that is legal. This purpose maxim was to protect true owner product. Most of case that applicable with this maxim was case: Lim Chui Lai v Zeno Ltd (1946) 30 MLJ 314.

In this case agreement was made between Zeno Ltd. with Ahmad which obtains contract from Majlis Perbandaraan Petaling Jaya (MPPJ) for culvert channel construction. Through contract, promises made by second parties and had agreed supply materials to construction culvert. However, agreement between Ahmad and MPPJ was revoked. Ahmad has already sell the said building material that supplied by Zeno Ltd. to Lim Chui Lai that as appellant in this case.

However, Zeno Ltd, submit a claim in court on Lim Chui Lai so that these substances returned or paid at the cost of that should. On claim, court ruled that Lim Chui Lai do not have any rights on material. However, Lim Chui Lai makes appeal to Court that is higher and Federal Court decided that Ahmad only is ‘bailee’ and open owner to the product in his time sell to Lim Chui Lai. Hence, federal court decided that Ahmad has no title on product or power to sell, so he does not could be shifting anything title to appellant.

However, there is some exceptions when happen this maksim nemo dat quod non habet such as, Estoppel, Unauthorized sale by a mercantile agent, Sale by one of joint owners, Sale by person in possession of good under a voidable contract, Sale by a seller in possession of the goods after a sale and also Sales by a buyer who is in possession of goods. 1. Estoppel First Exceptions to this maksim nemo dat quod non habet cited as estoppel is obstacle to owners to deny power of sellers to sell product under the title if he through the act had showed that he does not prevent sale.

Section 27(1) there is explain matter related to Estoppel was " unless the goods owner had elapsed the behavior, stopped from deny power of sellers to buy". Case Sample that applicable with Estoppel was case of Syarikat Batu Sinar Sdn Bhd & Ors. v. UMBC Finance Bhd & Ors 3 MLJ 468 when a company rental had purchased a tractor from one seller. However tractor that actually still unresolved hire purchase payment him with UMBC Finance.

However result UMBC Finance staff's negligence , claim of ownership on tractor that not registered in Road Transport Department (RTD). Supreme Leasing had purchased tractor that without realizing payment hire purchase still unresolved and still tied by under period hire purchase with UMBC Finance. Finally court rules that failure that continued as long as few months by UMBC Finance to enter claim of ownership on tractor that has been deemed as act which caused existence of estoppel that block them from deny Supreme Leasing title.

2. Sale by person in possession of goods under a voidable contract Another exemption to maxim nemo dat quod habet was related to sale by person in possession of goods under a voidable contract under allocate s. 29 states that if goods seller have obtained principal on goods under a voidable contract under s. 19 and s. 20. Contract act 1950 but contract the were no cancel at time sales, buyer get rights legitimately on goods provided he buy good faith and without knowing that seller no upper title product them.

Case sample that applicable with Sale by person in possession of goods under a voidable contract was Car case & Universal Finance Co. Ltd. v Caldwell [1965] 1 QB 525. Caldwell was owner a Jaguar car sold him to A. As payment, A has given Caldwell a different car and a cheque. Caldwell later found cheque that unsalable and directly makes police report and request the police and also Automobile recoups car him. After several times transferred the car purchased by plaintiff (Car & Universal Finance Co. Ltd) good faith. Caldwell retakes car he from plaintiff.

Plaintiff made lawsuit and court decided by monkey Caldwell have cancelled contract the instantly after find out him cheated, so plaintiff have no right on automobiles that although he buy good faith. s. 29 clearly stated in product principal case that obtained through contract may be revoked, if the voidable contract not cancelled so buyer that buy good faith will get the title on goods that. However in this case, car owner will scraps contract before plaintiff buy. So plaintiff do not get title on automobiles that. 3.

Sale by one of joint owner Exemption for maxim nemo dat quod non habet is Sale by one of joint owner. Exemption this fingered by s. 28 namely if one of from owners with product have principal on product the approvingly from owners other, title on goods will move to any people who buy from coowner with honest and do not know in time of the sales contract made that seller has no power to sell. For example that applicable with the third exemption was Mr. Ahmad, Mr. Bala, and Mr. Chew shared buy a boat to be applied to activity fishing that is hobby they with.

Boat that looked after and are kept by Mr. Ahmad in house river nearby base him with truth of two other owners. Mr. Ahmad offers to sell boat that to Mr. Danish. Mr. Danish agree to buy and pay price boat that to Mr. Ahmad without knowing that boat that also owned by Mr. Bala & Mr. Chew. In state purchase by Mr. Danish is legal and he get ownership on boat that because I) Seller him namely Mr. Ahmad is co-owner, II) Mr. Ahmad given permission by two more boat owners to keep product that and II) Mr. Danish makes purchase with honest without knowing Mr.

Ahmad has no power to sell the boat. 4. Sale by a seller possession of the goods after a sale Which states if a person after selling product, but continue to hold or hold document of title product that, then if he or agent him sell, pledge or make allocation form other on product that to any people who receiving goods the with honest without knowing on sale earlier should have effect that same as if people who make delivery or transfer the apparently authorized by goods owner to be doing same subject matter.

Section this is related to seller that sold product to shoppers first but still yet hold product that and subsequently sold to shoppers second. Second buyer do not know about existence of sales on goods that by seller to shoppers first. In this situation, second buyer which made purchase good faith and do not know for transaction earlier will get title legitimately on goods that. Apart from sales, s. 30 is also including business collateral, to bank for example and also other provisions such as pawn and so on. For example say Siti calls on night market with children her.

Siti met seller which sells ornamental tree. Siti buys two plant pot orchid flowers and after paying price her Siti asks seller keep trees that because he wishes to buy other goods. Sellers that forget that two orchid flower plant that were being sold to Siti past sell to other buyer who is also are intrigued by two orchid flowers plant that. When Siti comes again to take flower plant that it has been taken by second buyer. Seller apologies to Siti. In case sample this, second buyer gets property ownership on goods that bought her because he brazens that it were being sold to Siti.

What Siti doing was ask seller that reinstating money that she pay to price of two orchid flowers plant that. Siti cannot ask second buyer restore orchid flower plant that to Siti because he has possession legitimately on her. QUESTION 1 (b) Partnerships are one of the more common modes of business operation in Malaysia. Partnership is one of the types of business organizations that involve two or more individual’s pool money, skills, and other resources, and share profits and losses in accordance with the terms of the partnership agreement. The law of partnership is governed by the Partnership Act, 1961 (Revised 1974).

This is similar to the English Partnership Act, 1890. A number of principles of law arising from the English Partnership Act apply in Malaysia. The rules of equity and common law applicable in partnership will continue in force except in so far as they are inconsistent with the express provisions of the Act by virtue of section 4791) of the Act. The partnership agreement is a document written clearly and in detail the relationship between business partners and also roles and responsibility should be borne by each partner and contributed to a partnership.

The partnership agreement is covering all business situations where it can be during the life of the partnership, the documents are often complicated legal advisor in drafting and reviewing the completed contract is usually recommended. Referring to a group of five friends P, Q, R, S, and T would like to open a business exporting Malaysian handicrafts and ensure every partners should able to bring in a share amounting to RM25,000 means that the capital will amounting RM150,000. Here is some advice to form a partnership agreement and register written their firm.

There are several advantages of the smart partnership arrangements which involve a formal agreement with your partners. Through a partnership agreement it can outline specific details about the organization of the written format and are also very beneficial to create these documents well before the start of business activities for several reasons. Moreover, the benefit to the partnership is the formation of partnerships is very easy to set up as only an agreement among partners in the spoken or written word can bring the partnership already exists.

Additionally, clarifying the roles of several business partners get so caught up in the idea of starting a business that they do not take time to discuss what role each party will play in the successful launch of the company. A partnership agreement outlines the role, task list and the position of each partner to the arrangement. This helps reduce confusion and debate among members of what each person has to contribute. Partnership delivers an opportunity for suggestion of persons with diverse skills and expertise.

Partners consuming expertise and skills in changed functional areas of business can accomplish the business professionally. However, there are several disadvantages in the form of business partnerships still it is not the only best option available to entrepreneurs. There are several disadvantages in the form of partnership organizations such as there is a limit to the maximum number of partners in the partnership due to the capital that can be raised from limited partners.

Large-scale business requires substantial capital and not sharing the right shape to meet the requirements. In addition, the weakness of doing business as a general partnership is that all partners are generally liable for the debts and liabilities of such a judgment in a business suit. However court is concern in many small businesses claim can be reduced by practicing good insurance policy. Additionally, through literacy does not have debt problems, it is also true that businesses face significant risks in either of these areas may have to organize themselves as corporations.

In addition, when the Partnership Agreement established it may lose the advantages of informal if which if violated would be problematic to claim a breach of contract by the other partners. Furthermore, there is no legal personality separate to business and otherwise it will be personally liable for the debt and any losses incurred. Through the partnership, dissolved can be done anytime you want and not be subject to a period of time and it also can cause a sense of insecurity and instability to the remaining partners.

Overall partnership could end if termination finished and normally there is a transformation of opinion of the remaining partners are not in a position to purchase shares of the partners going out of business. QUESTION 2 (a) Agency was a link between principal and a third-party through involvement agent as you can see agent critical of so many business and commercial transaction. It also relationship that usual, very important and legal where emerge interstitially in many area law such as employment law, partnership law, corporate law, trade land features and item, and solicitor of a customer relationship.

Agency also lives between principal and agent , that was allowed cocky to principal in business with third party. QUESTION 2 (b) Three ways agency can be created such as Agency with appointment, Agency by Estoppel and Agency by Ratification. Agency with appointment appointment when principal appoint is an agent by express agency created by express agreement with agent. Express agreement this maybe is one agreement written or oral between principal and agent. Law of contract principles apply consideration to an to impetuous. General rule was agency the can be created orally and have no which to a agency the agreement.

An other hand, an agent can agree to act in award. On agency free if agent agree boast formality to creation agency by express discussed under. General rule this agreement, except about although to case one state appointing agent to sign agreement to sales and purchase of fixed asset, whether on behalf of vendor or buyer. An exception was where an agent appointed to carry a deed to principal. In this case, agent needs to be elected by deed, which called a warrant. Agency by estoppel floats when.

B A makes a and picture to one third party A party, whether by as word or behavior, was agent him, then third the face B an agent in dependence in representation such. become permitted to deny existence agency if normally finance) to the do so will will not damage (loss which party. cause third Then people who make representation such ("A" in paragraph (a) above)are treated as create one agency relationship between himself as principal and another person ("B" in paragraph (a) above) as agent him, although there was really no agreement between two parties ("A" and "B" in paragraph above) as to creation agency relationship. Agency by estoppel sometimes called appointment implied agent.

In agency by estoppel, agent's authority portrayed as only apparent or ostensibly but not real, when principal have, actually, not granted agent power such implement to principal. Point apparent authority or apparent agent in an agency by estoppels depends mostly on content representation made by principal to third party wishful and act in representation. Principal said to be reaching a person as agent him forcefully such as principal might be motivating third party believe and was estopped from deny existence agency.

Agency by ratification arise when a person confirm (that, approve and take) an act which has been done in his name and in on behalf of him by people the rest which actually, has no real power (whether state or propose) implement on behalf of him when action the was done. Ratification by itself only hold a agency relationship between principal and agent related to action the ratified by principal, but not related to any other act, whether after or future. People who confirm another action person must be comprised well off in existence and had capacity law to carry out the done and at that act himself both at that.

A time when action the was not be time ratification. person may devoid capacity law in reason bankruptcy, infancy or mental disability. QUESTION 2 (c) In these cases, liability can be avoided by Nathan if this can pointed that there is agency by necessity (s142 Contract Act 1950). In other words, Nathan plays as a agent to his employer and he becomes as agent by necessity. Agent of necessity is happened when a person or agent faced by one emergency where property person the rest in danger or will damage and it becomes necessary.

In other words, agency by necessity was a agency created by an emergency produced from one situation make need or lend itself to agent boast without receiving restriction or truth principal, so one responsibility imposed on a that avoid injury to principal. behalf of It floats when another apart person boast on from contract and prevents injury irreparable. Agency relationship such known by court. Due to time constraint, Nathan makes a decision to sell all the vegetables to the villagers at half the Agency by necessity arise only when it practically price. impossible to agent.

This will be communicate with principal before agent difficult to create with telecommunication acts to principal. system developed today and was reason why agency need not often arise. Nathan failed contact his employer because there was no telecommunication coverage in Kampung Dagong. Authority to act in case of emergency are not typically overcome over fast instruction to the opposite given by the principal or the agent of necessity must have acted in good faith. This clearly describe that Nathan is fulfill the condition to claim under agency by necessity and avoid liability.

Second situation on the other hand will happen if employers Nathan want him to repay again compensation on what had happened in failureNathan to carry vegetable to specified destination. this is because is remedy to breach of contract sales of goods which will probably imposed on employer Nathan that fail to bring product that has been ordered or are sold by customer him at a shop in Pekan, Pahang. If there is either party to contract sales of goods whether seller or buyer breaching of contract that were made, so party that promise him violated has the right to make claim on party that breaching of contract.

Remedy to default mean action that could be adopted by party that suffer losses to get compensation or compensation in connection breach of contract which is done by party that another. Method remedy to contract violation sales of goods allotted by VI s. 55 chapter to 59 AJB 1957. To case this, remedy to contract violation to damages claim on failure seller submit product that mentioned under allocate s. 57. If seller mistakenly, neglect or refused to hand over product to shoppers, buyer may summon seller to get substitute loss has no delivery that.

Principle which became court procedure in granting damages resulting product delivery failure made based on court decision in case of Popular Industries Ltd v Eastern Garment Manufacturing Sdn. Bhd. In this case court fix compensation is price differential commodity market that with price that sanctioned in contract. This enable buyer that violated delivery product the buy goods in market without having to suffer losses due to contract violation which made by seller. If no market price to product that, total compensation is based on loss that can expect as contract possibility effe.