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 Page 1 of 9 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 Page 2 of 9 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 Page 3 of 9 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 Page 4 of 9 advised that Chloe, Alya and Sabrina may highly likely all succeed to claim compensation against Mayang Sari Hotel for the loss of their valuables. ****************************************************************************** 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 Page 5 of 9 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 Page 6 of 9 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. Page 7 of 9 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 Page 8 of 9 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. ***************************************************************************** Page 9 of 9