Assignment 2 BGN352

FACULTY OF ARCHITECTURE, PLANNING AND SURVEYING
DEPARTMENT OF BUILDING SURVEYING
BGN 352 – BUILDING LAW

ASSIGNMENT 2
AP116 6B
PREPARED BY:
NUR NATASYA BINTI MOHD ISA (2019288898)
NUR FARZANA AYINA BINTI RAHIMIE (2019412798)
ANISYA SABILLA BINTI MOHD TAUFIQ EDWARD (2019446184)
NURUL SYAMIMI HANA BT NGAINI (2019250968)
PREPARED FOR:
SIR AZHAN BIN JALALUDIN
SUBMISSION DATE:
1st JULY 2022
QUESTION
Dato’ Herman, a well-known contractor, wants to give his son a parcel of land situated in
Petaling Jaya worth RM800,000 for his coming birthday. As his son will not be paying any
money to him, Dato’ Herman is worried that the contract may be void by virtue of section 26
of the Contracts Act 1950 which states that an agreement made without consideration is void.
Dato’ Herman seeks your explanation on the validity of the agreement.
(100 marks)
ANSWER
The first question that arises in response to the aforementioned query is whether the contracts
between Dato' Herman and his son are legitimate. Secondly, does natural love and affection
have an impact on the contract’s legality? The Malaysian Contracts Act 1950, which governs
Malaysian contract law, is statutory legislation that has various provisions that may be
considered while deciding legal issues. One of the most crucial components of a binding and
enforceable contract is a consideration. Every legally binding contract must include
consideration. Basically, it is payment for the promisor's pledge. A contract without
compensation is generally invalid, according to both the Contract Act of 1950 and English
common law. Consideration also can be defined as in Section 2(d) as when something is done
or not done at the request of the promisor, or when someone else pledges to do or refrain
from doing something, such as acting or abstaining from acting.
According to the Law of Contracts, consideration can be divided into three categories,
executory consideration, executed consideration and past consideration. In contrast to
executed consideration, which occurs when the promise and the act are both essential and
linked components of the same transaction, executory consideration is defined as a promise to
act, to refrain from acting, or to suffer. However, past consideration is defined as the act
following the promise and vice versa. Moreover, unlike Section 2(d), common law does not
recognize past consideration, except in limited circumstances. However, the 1950 Act's
notion of consideration differs from that of the common law. There are exceptions to the
general rules both under the 1950 Act and the common law.
According to Section 26 of the Contract Acts, an agreement established without consideration
is void, unless it falls within one of the kinds of agreements that are stated there as being
excluded from the rule.
The case of Re Tan Soh Sim may be relevant to this matter. Tan Soh Sim married but had no
problem adopting four kids. In her last illness, the late Tan Soh Sim indicated a desire for her
fortune to be split equally between her two adopted sons and her two adopted daughters.
Respecting her wishes, the legal next-of-kin drafted the agreement, waiving all rights in favor
of four adopted children who were their nephews and nieces. Tan Soh Sim died without
regaining consciousness. The validity of the instrument signed by Tan emerged during the
division of his inheritance. The instrument was argued to be a contract under Section 26(a) of
the Contracts (Malay States) Ordinance 1950.
Furthermore, this relevant case inspired the issue of what "close relations" in the context of
section 26(a) of the Ordinance actually meant. The phrases "connection" and "close" must be
applied and construed in each situation in accordance with the customs of the group to which
the parties belong and considering the circumstances of the family in question, according to
the Court of Appeal. According to Chinese tradition, someone who has been adopted is a
related, and whether or not he qualifies as a "close" relative for the purposes of section 26 of
the Contracts Ordinance depends on the other person's status. Agreements between an
adopted child and his adoptive parents or brothers are very certainly backed by the affection
that exists between them. The court determined that the document did not comply with
section 26(a) of the Contracts Act as a result.
The court determined that the document did not comply with section 26(a) of the Contracts
Act as a result. The court went on to say that the word "natural" in the term "natural love and
affection" must be given full effect since it not only implies "fairly to be anticipated," but also
"clearly to be expected, having respect to the typical emotional sentiments of human beings."
This clearly shows how these terms relate to the last sentence, "standing in a near relation."
This statement implies that the "emotional sentiments" necessary are of a particular kind, i.e.,
they are the kinds of emotions that one would often anticipate resulting from the existence of
a "close relation." "The section does not apply if either the relation or the sentiments are
absent."
As trying to help Dato’ Herman decides if he has the right to give his son the property since
their biological ties, as father and son, are too close to justify the land transfer without
payment. Furthermore, it is clear that if an agreement made between Dato’ Herman and his
son had been fulfilled at the outset, as required by Section 26(a) of the Contracts Act, which
refers to an agreement based on natural love and affection, then the transfer of the property
made between the two of them would have been considered valid under Malaysian law.
In a nutshell, by all the explanation that have stated above with relevant cases prove that the
result of Dato' Herman may, without fear and in light of the case law ruled in favor of his
position to offer his son the use of his land without receiving any compensation from the son,
is allowed by Section 26 of the Contracts Act 1950, solely out of "natural love and
compassion." Hence, in Contracts Act 1950 which states that an agreement made without
consideration is void, Dato' Herman and his son still have a valid contract if the conditions of
Section 26(a) of the Contracts Act are satisfied. Even without consideration, the following
agreements are not void by the requirements that it needs to be expressed in writing, that it be
registered (if necessary), and that the parties be in close proximity to one another then will it
be enforceable.

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FACULTY OF ARCHITECTURE, PLANNING AND SURVEYING

DEPARTMENT OF BUILDING SURVEYING

BGN 352 – BUILDING LAW

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