FORMATION OF CONTRACT (合约)

Stanley Phang

4 days ago

4 min read

Updated: 2 hours ago

We often hear about the term “Contract”, but do you know how is a contract formed?

A contract can be made either orally or in writing. According to Malaysian law, a valid contract must contain four crucial elements, namely:-

(1) Offer / Proposal;

(2) Acceptance of the offer;

(3) Consideration; and

(4) An intention to create legal relation.

OFFER

An offer is made when the offeror (the one who makes offer) signifies to the offeree (the one whom the offer is made to) his willingness “to do” or “to abstain from doing something”.

An offer may be made to an individual, a group of people, a company, or the entire world.

Example: In a supermarket. When a customer takes the goods from the shelves to the cashier's counter, such action is considered as an offer made to the supermarket to buy said goods.

ACCEPTANCE

After Party A has made an offer to Party B, Party B must accept such offer to form a contract. In which event, Party B’s acceptance MUST BE COMMUNICATED to Party A (such acceptance can be done by a simple gesture or by a formal written response), and such acceptance must be unconditional.

Example: In a supermarket, the cashier’s action in collecting the money from the customer is an indication that the supermarket has accepted the offer made by the customer to buy the goods.

However, if Party B changes Party A's offer before such acceptance, there is no acceptance made, but a counter-offer made to Party A instead. Once the counter-offer is made by Party B, Party A's original offer no longer stands. In which event, Party B can no longer accept Party A's original offer, and it position of the parties will switch, whereby it is now up to Party A to whether to accept Party B’s counter-offer.

Example: The cashier in the supermarket discovered that an incorrect price tag was labelled on certain goods, the action in telling the customer that the goods are actually RM10.00 instead of RM8.00 is a counter-offer made to the customer, at which point, it is up to the customer to decide whether he wants to accept such item.

CONSIDERATION

The Consideration, to put in plain and simple term, is the promise made by the contracting parties to one another.

Example: In a sale and purchase transaction in the supermarket. The customer’s consideration is the money that he is paying, while the supermarket’s consideration is the goods to be sold to the customer.

Both contracting parties must provide Consideration to each other, otherwise a contract without Consideration is not a binding contract and is void.

In addition, the Consideration given by both contracting parties may not have to have the equal value, an inadequate Consideration is sufficient to form a Contract.

Example: The purchase price of RM1.00 to buy a car is a good Consideration as long as the seller of the car agrees to it.

INTENTION TO CREATE LEGAL RELATION

If the contracting parties have no legal intent to make a contract, the contract will be non-binding. Generally, there is no legal intent to make a contract in a family. In these cases, the intent of the parties to make a legal contract should be expressly and clearly established.

Example: A brother promised his sister for a scrumptious dinner, but at the end the sister is stood up by the brother, the sister may not be able to pursue in law to enforce her brother’s promises.

As a conclusion, the formation and configuration of the contract is ever-changing, depending on each unique situation. Therefore, if you want to safeguard that your interests are legally protected, we would advise that consultation be sought to ensure that a valid contract is entered between the parties concerned.

我们常常都会听说到“合约”“合约”，但是你知道一份合约是怎么样组成的吗？

合约，可以是由口头或书面形式的。根据大马的法律, 一份有效的合约必须含有四种元素，分别是（1）要约 (OFFER/PROPOSAL), （2）接納 (ACCEPTANCE), （3）代價 (CONSIDERATION)和（4）受法律約束的意圖(INTENTION TO CREATE LEGAL RELATIONS)。

1) 要约 (OFFER)

要約(OFFER)是当甲方向乙方列出的交易條件，要約可以是向个人，一群人，一家公司或整个世界提出的。

例子: 一位顧客在一家超級市場。当他把貨架上的貨品拿到收銀員的柜檯上，这一个动作就是向超級市場作出要約(OFFER)。

2）接納 (ACCEPTANCE)

甲方向乙方發出要約(OFFER)後，乙方若要接納(ACCEPT)要約(OFFER)，以構成合約，乙方必須要让甲方知道(ACCEPTANCE MUST BE COMMUNICATED)（可以是一个简单的动作或正式书面回应），而且其接納(ACCEPTANCE)必須是無條件性的﹙UNCONDITIONAL﹚。

例子: 在超級市場，当收銀員向顧客收钱时，超級市場已接納了顧客作出的要约。

但是若乙方在接納的同時，要求加入或改變甲方的要約，在法律上而言，乙方並不是接納，而是向甲方發出一個反要約﹙COUNTER-OFFER﹚。一旦發出反要約﹙COUNTER-OFFER﹚，甲方原來所發出的要約 ﹙OFFER﹚就会即時摧毀，在此之後，乙方已经不可以接納甲方原來的要約了。

例子: 超級市場的收銀員发现货品标错价钱，因此“反要約”(COUNTER-OFFER)告诉顧客其实那货品是RM10.00 而不是RM8.00，这时那是由顧客决定他要不要接納（ACCEPT）该货品。

接納(ACCEPTANCE)一般可以用語言或文字作出，最好当然是要有纪录。

3）代價﹙CONSIDERATION﹚

代價是任何一方作出的承諾或承擔責任。

例子: 在超級市場的那一宗买卖的合约。顧客的代價就是他将会付的钱，而超級市場的代價就是它将会出售给顧客的货品。

除此之外，代價只需‘有償’而無需‘等價’

例子：一零吉买一辆汽车的合约都是有法律效应的。

4）受法律約束的意圖﹙INTENTION TO CREATE LEGAL RELATIONS﹚

若被證實立約一方並無立約的法律意圖，有關協議將無約束力。一般情況下社交或家庭式協議中有關人等並無立約的法律意圖，在此等情況下需要將立約的法律意圖清晰建立。

例子：哥哥答应请妹妹吃丰富的西餐，但是哥哥爽约了，妹妹不能向哥哥在法律上追究。