SAMPLE OF SOME GOOD ANSWERS
SAMPLE 1
The first issue in this question is whether Chloe would succeed if she were to claim compensation
against Mayang Sari Hotel for the loss of her valuables, as a customer who booked their room
online. The second issue in this question is whether Alya would succeed if she were to claim
compensation against Mayang Sari Hotel for the loss of her valuables, as a customer who made
their room booking through a travel agent. The third issue in this question whether Sabrina would
succeed if she were to claim compensation against Mayang Sari Hotel for the loss of her valuables,
as a walk-in customer with no prior booking.
A contract is defined as “an agreement enforceable by law” according to s 2(h) Contracts Act 1950.
The necessary elements for a legally binding contract include offer and acceptance, as well as
consideration, intention to create legal relations, capacity and certainty. Offer is defined by s 2(a)
Contracts Act 1950 as an assurance by one person to another to do or to not do something. The
first requirement of an offer is that it must be accepted only by the person(s) that the offer was
made to, such as in Carlill v Carbolic Smoke Ball Company (1892) EWCA Civ 1, where the offer
was made to “anyone”, and therefore anyone performing the terms could be deemed as accepting
it. The second requirement of an offer is that there must be clear communication and awareness of
the offer to the person(s) it was made to, such as in Carlill v Carbolic Smoke Ball Company, where
the advertisement was clear in writing that there would be £100 compensation if anyone were to
catch influenza after using Carbolic Smoke Ball. The third requirement of offer is that it must be
written in words or implied as mentioned in s 9 Contracts Act 1950. The fourth requirement is that
an offer must be certain. If it is too vague, it may not be enforceable, such as in Ahmad Meah &
Anor v. Nacodah Merican (1890) 4 Ky 583 where a man was promised “a house which must be a
suitable building” by his father-in-law for marrying his daughter. Lastly, an offer must be legal.
Acceptance is defined as agreement of the offer by the person(s) the offer was made to according
to s 2(b) Contracts Act 1950. According to s 7 Contracts Act 1950, the requirements of acceptance
are that it must have been accepted on the current terms of the offer, without the switch or creation
of new terms, and acceptance must be communicated in a normal manner. In this question, the
hotel made the offer to Chloe of completing the booking with the condition of accepting the terms
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and conditions. As Chloe clicked to accept the terms and conditions, she expressed her agreement
with the offer. Therefore, Chloe does have a legally binding contract with the hotel. For Alya, the
offer for booking the hotel room was made through a travel agent. There is no information provided
of Alya’s acceptance of the offer, however as it is known that Alya got her hotel room, it can be
said that she accepted the offer. Therefore, Alya has a legally binding contract with the travel
agent. However, according to s 179 Contracts Act 1950, entering into contracts through an agent
will have the same legal consequences as if entering with the party the agent is representing.
Therefore, it can also be said that Alya has a legally binding contract with the hotel. For Sabrina,
she was able to get a room as a walk-in guest, which means she accepted the hotel’s offer for a
room at the reception desk and therefore she also has a legally binding contract with the hotel.
A term is an important statement made before or at the time of entering into a contract that forms
part of the contract. An exclusion clause is a term that has been put into the contract to restrict or
fully exclude the liability of the party that has put it in. For an exclusion clause to be valid, the
other party must be aware of it before or during the time of the contract, and reasonable steps must
be taken to reach this awareness. For example, in the cases of Parker v Sth. Eastern Railway Co
(1877) 2 CPD 416 and Thompson v London, Midland and Scottish Railway Co Ltd (1930) 1 KB
41, the ‘see back’ printed on the front of the train tickets and the printed conditions at the back
were reasonable attempts of bringing the exclusion clause to the plaintiff’s attention. Therefore,
the exclusion clauses were valid in both cases. Whereas in the case of, Sugar v London, Midland,
and Scottish Railway Co Ltd (1941), the ‘see back’ words were blocked by a stamp, therefore the
courts ruled that attempt to bring awareness was insufficient, therefore the exclusion clause was
invalid. Similarly, in the case of Thornton v Shoe Lane Parking Ltd (1971) 2 QB 163, the court
also ruled the exclusion clause invalid. This was because it was posted on a notice outside the
building and not included in the parking ticket contract. Therefore, there the steps taken to bring
the clause to the plaintiff’s awareness was not sufficient. If the other party was made aware of it
after the contract, the exclusion clause is generally deemed invalid, except in the case that there
was constant communication between the parties that may suggest implied notice by the court. For
example, in the case of Olley v Marlborough Court Hotel (1949) 1 KB 532, the plaintiff was made
aware of the exclusion clause when in the hotel room, after the contract was made in the check in
counter, therefore the exclusion clause was invalid and the hotel had to compensate for the
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plaintiff’s stolen items. If it is included in a written document that the other party signs, regardless
of whether they have read it or not, it is automatically binding, in the event that there is no fraud
or misrepresentation. For example, in the case of L'Estrange v Graucob (1934) 2 KB 394, the
exclusion clause was included in the document which the plaintiff had signed, therefore the
plaintiff was bound by the terms regardless of whether they had read it or not. Exclusion clauses
must also be clear and transparent in their construction and expression, clearly excluding what the
party wants to exclude liability over, otherwise they will be considered invalid. For example, in
the case of Playing Cards (M) Sdn Bhd v China Navigation Co Ltd (1980) 2 MLJ 182, the
exclusion clause clearly stated that the carrier would not be liable for damage or loss due to
“delayed or early arrival of the goods”. Therefore, the exclusion clause was valid against the delay
of shipment and judgment was given to the respondents. In the case of Premier Hotel Sdn Bhd v
Tang Ling Seng (1995) 4 MLJ 229, exclusion of liability due to negligence was not explicitly
stated, and thus the courts ruled the hotel liable. Another example is in White v John Warwick
(1953) 1 WLR 1285, where it was not specifically stated in the exclusion clause that liability due
to negligence would be excluded, and thus the defendants would be liable for negligence.
However, the fairness of the exclusion clause can be called into question. According to s 24A
Consumer Protection Act 1999, an “unfair term” refers to “a term in a consumer contract” which
gives the party an a “significant imbalance” at the consumers’ disadvantage in regards to their
rights and obligations. A consumer is defined by s 3 Consumer Protection Act 1999 as a person
who “acquires goods or services” normally purchased “for personal, domestic or household
purpose use or consumption”. In the event that the defendant is a consumer and the term is unfair,
the exclusion clause is deemed void in accordance to s 24G (1) Consumer Protection Act 1999.
In Chloe’s case, by having the webpage with the option to agree to the terms and conditions which
included the exclusion clause, the hotel has made a sufficient attempt to make Chloe aware of the
clause. By accepting the hotel’s terms and conditions, Chloe is bound to the terms of the contract
including the exclusion clause, even if she had not read it as shown in L'Estrange v Graucob,
Parker v Sth. Eastern Railway Co, and Thompson v London, Midland and Scottish Railway Co
Ltd. However, the exclusion clause only states that it excludes liability “howsoever caused”. The
term “howsoever caused” is too broad and the clause does not specifically mention the word theft,
unlike how delayed arrival was specifically mentioned in Playing Cards (M) Sdn Bhd v China
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Navigation Co Ltd. Thus, the exclusion clause would be considered invalid and the hotel would be
liable to compensate Chloe, such as in Premier Hotel Sdn Bhd v Tang Ling Seng and White v John
Warwick with negligence. In Alya’s case, the travel agent she booked her room through only made
her aware of the terms and conditions of the travel agency, not the hotel’s. Alya was only made
aware of the exclusion clause when she entered her hotel room, as there was a copy put behind the
door. Since there was not a reasonable attempt to bring the hotel’s terms and conditions to her
attention before or during the time of entering the contract, the exclusion clause is not valid, such
as in Olley v Marlborough Court Hotel. In Sabrina’s case, since she was a walk-in guest, she would
have made her booking at the reception desk, where the notice of the exclusion clause would have
been on the reception counter and wall. However, the exclusion clause was put on the notice and
not included in the contract, and there was no mention of the staff orally communicating the clause
to her. Therefore, it can be said that the exclusion clause is invalid because there was an insufficient
attempt to bring the exclusion clause to her attention, such as in Thornton v Shoe Lane Parking
Ltd. Additionally, the terms stated in Mayang Sari Hotel’s exclusion clause can be considered as
unfair, as defined by s 24A Consumer Protection Act 1999, because they place a greater
responsibility on the consumer. As all three friends, Chloe, Alya and Sabrina can be defined as
consumers under s 3 Consumer Protection Act 1999, and the term including the exclusion clause
can be defined as unfair, therefore the exclusion clause can also be considered void under s 24G
(1) Consumer Protection Act 1999.
It may be concluded that in Chloe’s case, the exclusion clause may be considered invalid because
exclusion of liability due to theft was not specifically stated. Thus, it may be advised that Chloe
may succeed to claim compensation against Mayang Sari Hotel for the loss of her valuables. It
may be concluded that in Alya’s case, the exclusion clause may be considered invalid because she
was made aware of it after the contract was made. Thus, it may be advised that Alya may succeed
to claim compensation against Mayang Sari Hotel for the loss of her valuables. It may be concluded
that in Sabrina’s case, the exclusion clause may be considered invalid due to not enough reasonable
steps to make her aware of it. Thus, it may be advised that Sabrina may succeed to claim
compensation against Mayang Sari Hotel for the loss of her valuables. The rule for unfair terms
from s 24A and s 24G (1) Consumer Protection Act 1999 may also be applied, it may also be
concluded that the exclusion clause is unfair and therefore void in all three cases. Thus, it may be
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advised that Chloe, Alya and Sabrina may highly likely all succeed to claim compensation against
Mayang Sari Hotel for the loss of their valuables.
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SAMPLE 2
Issue
In the case of Chloe, Alya, and Sabrina, the issue in this case is whether they are eligible to claim
the damages of their stolen goods caused by the negligence of Mayang Sari Hotel in spite of
allegedly being protected by the terms they have implemented. It is also whether to determine if
they are in a legally enforceable contract with the hotel.
Law & Application
According to the Contracts Acts 1950, Section 2(h), which states that a contract is merely defined
as a legally enforceable statement that binds two or more parties into performing a service. An
example of a legally enforceable contract is hiring someone to do electrical work in a house. There
are elements that should be taken into account to make a legally enforceable contract in accordance
with the statute in which it will be explained. The general rule when getting into a contract is that
every party shall be competent, meaning that all parties shall be sound of mind and above the age
of minority as stated in Section 11 of the Contracts Act 1950. The general rule also states that
contracts are void if there is no consideration, implying that all parties involved in a contract will
have to give something to the other respective parties, as stated in Section 26. Section 10(1) states
that all contracts are valid with the free consent of all parties, implying that no parties shall be
coerced or forced to be in a legally binding contract. A contract is enforceable when an offer and
acceptance has been made between the offeror and offeree as stated by Section 2(a) and 2(b),
implying that the communication within the parties involved must be direct. Section 30 states that
all contract agreements shall have certainty to make it enforceable, as seen at the case of Karuppan
Chetty v. Suah Tian (1916) 1 F.M.S.L.R 300 where the court ruled that the contract is unenforceable
as there was lack of certainty of the agreement which affirms that all contracts should be
unambiguous by their terms. Lastly, contracts are required to establish legal relations with one or
more parties which includes written agreements, speech agreements or any evidence of the parties
setting an agreement. Comparing the cases of Merritt v Merritt [1970] 1 WLR 1211 and Balfour v
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Balfour [1919] 2 KB 571, the difference between the cases was that the Merritt case had a written
agreement and the Balfour case did not. Which signifies that the parties are willing to create a legal
relation by documenting their agreement which will then create a legally binding contract. Linking
back to the issue, it is certain that all of the plaintiffs had a legally binding contract with the hotel
as they have met the criteria to make an enforceable contract.
The terms of a contract can be in the form of expressed and implied terms, expressed terms
are merely defined as terms that were documented directly to the contract with the consent of the
parties involved which would then be used as evidence. Whereas implied are terms indirectly
documented to the contract without the acknowledgement of the parties involved. Exclusion
clauses are terms that exclude a party from compensating damages when a breach of contract or
negligence occurs, a common example of an exclusion clause can be a sign board that states “Park
at your own risk” at an illegal parking space. Exclusion clauses can be in the form of a signed and
unsigned document and must have certain elements to incorporate to make it valid. Signed
documents with exclusion clauses often come with Terms and conditions, looking at the case of
L'Estrange v Graucob [1934] 2 KB 394 where the court held that the exclusion clauses are still
valid even if the party has not read the terms thoroughly as the plaintiff has already consented to
the terms by default. Unsigned exclusion clauses often come in the form of signs and tickets, it is
only effective when the clauses are reasonable and of the awareness of the consumer. As seen in
the cases of Parker v Sth. Eastern Railway Co (1877) 2 CPD416 and Sugar v London Midland
and ScottishRailway [1903] 1 KB 41, the contrast between these cases was that the Parker’s case
the clauses notice was detailed for the consumer to be aware of whereas the Sugar’s case the
clauses were not made clear for consumers to see. Exclusion clauses should also be informed prior
as well as during the period of the contract, as seen in the case of Olley v Marlborough Court Hotel
[1949] 1 KB 532 where the court held that the defendant will be held liable to the damages due to
the fact that the plaintiff was not informed of the clauses prior to entering the contract. It also goes
by assumption that if the consumer has had previous dealings with the defendant, it implies that
the consumer was already aware of the exclusion clauses with the numerous times the consumer
had entered the contract citing the case of J Spurling Ltd v. Bradshaw (1956) EWCA CVA 3 where
the court ruled that the plaintiff was bound by the exclusion clause due to previous dealings with
the defendant. Exclusion clauses should also not be misinterpreted to the customer as it may not
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be effective, citing case Curtis v Chemical Cleaning Co [1995] 1 KB 805 where the court stated
that the interpretation by the defendant was not the same as to what was interpreted on the
exclusion clause, implying that the clauses should remain absolute to its meaning. The general rule
for exclusion clauses is that the clause should be unambiguous and adequately detailed for
consumers to take into account, otherwise it may be deemed as valid to exclude from liability. As
seen in case of Wallis Son & Wells v Pratt & Haynes (1911) AC 394 where the court states that
the exclusion clause is of ambiguous nature for the plaintiff to be aware of, thus it may not be valid
for the defendant to use. The case of Causer v Brown [1952] VLR 1 determines whether if
exclusion clauses contain any means of contractual terms, the court ruled that the reasonable
person would not consider the ticket given by the defendant as a contract to execute the clause,
hence it may not be valid due to the fact that it lacks the elements of the ticket being a contract.
Chloe’s case
Onto the context of Chloe’s case, she has entered a legally binding contract with the hotel as she
had the intentions to create legal relations to proceed with an agreement. It can be an assumption
that the terms of the contract are expressed due to having consensual agreements that were
documented. In terms of the effectiveness of the terms implemented by the hotel, Chloe had signed
a contractual term prior to booking the hotel. As per the scenario involving Chloe, it was
understood that Chloe had not read the terms and condition thoroughly or in an explicit manner, it
goes by assumption that she had consented to the terms as per the case of L'Estrange v Graucob
[1934] 2 KB 394 where the court held that the terms were valid due to the consent given by the
plaintiff. Therefore, the terms that protect the hotel are effective against Chloe’s claim due to her
consent to it. However, upon further scrutinising,it can be deemed that the terms implemented by
the Hotel can be said to be unjust. As per S.24(a) Consumers Protection act 1999, terms can be
unfair depending on the severity of the damages caused by negligence towards the consumer.
Consumers are merely defined as an individual who consumes or uses goods and services for
personal use rather than commercial use, as per Section 3. If the terms of both of these sections are
satisfied, the terms implemented by the defendant will be voided under section 24G (1) as proven
by the case of White v John Warwick [1953] 1 WLR1285 where a breach in negligence will make
the terms ineffective. Hence with that, the terms may not be effective against Chloe.
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Alya’s case
Applying the laws to Alya’s case, she has entered into a legally binding contract with the hotel
given the fact that she had the intentions to create legal relations to proceed with the agreement.
The terms of Alya’s contract can be assumed to be implied given the fact that there was no
documentation of the terms directly from the hotel, nor were there consensual agreements to the
terms of the contract. In determining whether the exclusion clause implemented by the hotel was
valid, it is required to see how Alya got into the contract in the first place. As stated before, she
entered the contract through a travelling agency, the travel agent informed her in detail that the
agency would not be held liable to any inconveniences from the hotel. However, the agent never
mentioned the terms and clauses implemented by the hotel. To which she was not well informed
of the terms of the hotel prior to entering the contract. Although it is certain that the hotel did take
reasonable measures into implementing detailed terms in the reception desk, walls, and in the hotel
rooms, the exclusion clause was valid for consumers to be well informed of. However, it may not
apply to Alya as she was not well informed of the terms prior to entering a contract due to the
negligence of the travel agent. Given that one of the requirements to make an effective exclusion
clause was that clients should be well informed of the terms prior and during the period of the
contract, which was justified in the case of Olley v Marlborough Court Hotel [1949] 1 KB 532.
Where the court concluded that the plaintiff was eligible to claim damages as she was not well
informed of the terms prior to entering an enforceable contract. Therefore, the terms may not be
valid against Alya.
Sabrina’s case
Onto Sabrina’s case, she has entered into a legally binding contract with the hotel as she had the
intentions to create legal relations to proceed with an agreement. It can be assumed that the terms
Sabrina are implied due to having no consensual agreements. To determine whether the exclusion
clause implemented by the hotel was valid, it is required to see how Sabrina got into the contract
in the first place. As stated before, she managed to create a contract with the hotel as a walk-in
guest and only saw the sign behind the door. However, one may argue that the exclusion clauses
may still be valid. Given the fact that the hotel took reasonable measures to implement the terms
at the reception desk in a detailed manner, a reasonable person would be able to see the terms from
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the clauses and acknowledge it. Therefore, it goes by assumption that Sabrina did in fact see the
signs at the reception desk prior to making a reservation with the hotel. Therefore, the terms
implemented by the hotel are still effective against Sabrina’s claim. Upon further examination, the
terms that the hotel implemented can be deemed as unfair. As defined by S.24(a) of the Consumers
Protection act 1999 that terms can be unfair depending on the severity of the damages caused by
negligence towards the consumer. Consumers are merely defined as a person who consumes goods
and services for personal use rather than trading, as seen on Section 3. If both sections are proven
right, the terms implemented by the defendant will be nullified under section 24G (1) as proven
by the case of White v John Warwick [1953] 1 WLR1285 where a breach in negligence will nullify
the terms. Thus, the terms may not be effective against Sabrina.
Conclusion
In essence, despite the exclusion clause being effective against Chloe and Sabrina, it can be
nullified as per the Consumers Protect Act 1999 due to the fact that the terms may not cover injurybased negligence. With that in mind, they are more likely to be given the mentioned damages. As
for Alya, she has the upper hand in receiving damages as she was not well informed of the terms
of the hotel due to the negligence of the travel agency.
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