Section A

Please state your opinion in respect of the following statements, with a brief explanation in 200 words or less: –

1. “A contract must always be in writing in order to be valid and enforceable at law, even if the elements of a contract are present.” Is this statement correct?

2. “For a contract to be binding at law, there MUST be consideration in cash only, and it does not matter WHEN the consideration was promised.”

3. “If I picked up an item from the shelves of a supermarket, I would have accepted the store owner’s offer to sell that item to me at the price on the price tag.”

4. “When a husband offers a job to his wife, there can never be a binding contract between them ever because of their marital relationship.”

5. “A newspaper advertisement can never be an offer.”

Section B

Please read the facts carefully and answer all questions that follow.

6. David wished to sell his condominium unit. He called Michelle who was then looking to buy a condominium unit for herself. They met and spoke over coffee. David then agreed to sell to Michelle his flat at the Tandra Condominium, and they shook hands on their deal.

Michelle went to a nearby bank ATM, withdrew some cash and gave it to David as a token of her verbal agreement to purchase David’s unit. She then started sourcing for a bank to finance her purchase. In the meantime, the market prices of units at the Tandra Condominium shot up unexpectedly. David refused to go through with the sale to Michelle. Michelle sued David.

[NOTE: Please read each of the questions below separately, and DO NOT relate your answers in one part to the other parts – each of the following scenarios are independent of each other.]

a) Assuming that the agreement was made orally, and that there was no written agreement made between David and Michelle, please explain whether Michelle can prove a case of breach of contract against David.

b) Assume that there was a valid agreement between David and Michelle, and that David has obviously breached his agreement for sale with Michelle. Applying the law of contract, what would be a sufficient remedy for Michelle?

c) Assume that there was a valid agreement between David and Michelle, and it was Michelle who is unable to go through with the purchase of the unit because she cannot obtain a housing loan. David wants Michelle to complete the contract. Applying the law of contract, what remedy can Michelle ask the Court?

7. Terry walked into a curio shop owned by Jenny. She found many interesting and strange items which were on the shelves with price tags laid out below the items. As she walked about, she came across a lovely necklace that was embedded with shiny yellow stones. It was very bright and sparkling, and was sitting on top of a label that read “$10.00”. Since it was a small amount, and she was very attracted to the glittery item, Terry took the necklace to Jenny and extended a $10 note to pay for the item.

Jenny gasped at the sight of the necklace, and quickly took it away, saying that it was not for sale. Terry was amazed. She asked Jenny what had happened. Jenny said that the item was her real yellow diamond necklace, and that it was worth more than $100,000. Jenny said that her daughter must have put the necklace on the shelf to annoy her, because she refused her an outing with her friends to Malaysia.

Terry insisted that Jenny must sell her the item, because the display was an offer, and her tender of $10 at the cashier was her acceptance. She argued that since there was already acceptance of a valid offer, Jenny must hand over the necklace to her at $10.

Jenny flatly refused to do so. Terry is upset. She wants to have your opinion on the following matters, so that she may consider whether to sue Jenny:-

a) Terry says that the display of the necklace on the shelf with a price tag of $10 below the item was an offer by Julie to sell the necklace at $10. Do you agree with this? Please explain what the nature of the display will be, according to the law of contract.

b) What was the legal effect of Terry’s act of extending a $10 note to Jenny at the cashier? Please explain in your own words, applying the law of contract principles.

c) Did Jenny have the right to reject Terry’s act of extending the $10 note in payment of the price stated on the tag? Please explain why you think so, referring to the contract law principles that you know, and discuss whether, by doing so, Jenny would be breaching any laws.

8. Kaira wanted to surprise her aunt, who always complained that she had no time to bring her car in for a quick wash because of her busy schedule. Kaira washed her aunt’s car after her aunt had gone to bed. The next morning, Kaira’s aunt is pleasantly surprised.

Her aunt was extremely happy, and promised to take her to Disneyland in Tokyo during her next school holidays. Kaira was very excited, as she never expected that her aunt should give her anything for her surprise services. Kaira went ahead to buy the necessary warm clothes for the trip as the weather was expected to be very cold in Tokyo.

a) What is the nature of Kaira’s aunt’s promise to take her on the holiday? Citing the principles of the law of contract, explain your answer in brief (~100 words). Please assume that intention to create legal relation is not an issue, and will be present.

b) Applying the law of contract principles, state whether there is a valid and
enforceable contract made between Kaira and her aunt.

c) If her aunt later changed her mind and refused to take Kaira to Tokyo Disneyland, state whether Kaira can sue her aunt for breach of contract.