Defective Products

Link: http://www.articlesonline.org/article/law/defective-products--by-anna-henningsgaard/id/5875/

From the article above, who is liable for the defective product? what legal action can we take to sue the company when there is someone get injured by the defective product?

Consumer Protection Act 1999 is a statutes enacted to safeguard consumer rights by (1) enforcing or enhancing product safety standards, (2) increasing the availability of consumer interest related information, and avoiding the use of deceptive marketing approach as explained in BusinessDictionary.com.

In Consumer Protection Act 1999 (CPA), Section 67 defined the meaning of "defect". As for Section 68, it stated the liability for defective products.

1) Where any damage is caused wholly or partly by a defect in a product, the following persons shall be liable for the damage:

a) the producer of the product;

b) the person who, by putting his name on the product or using a trade mark or other distinguishing mark in relation to the product, has held himself out to be the producer of the product; and

c)the person who has, in the course of his business, imported the product into Malaysia in order to supply it to another person.

Other that CPA, common law, under duty of care also can be referred. One of the cases is Donoghue v. Stevenson (1932). This case is about the customer get poisoned by drinking the drinking contents where the ginger beer contained dead snail. He sued the producer for negligence. The producers owed a duty of care for the customer.

Basic requirement for a valid insurance

The basic requirement to a valid insurance is provided in the case of Prudential Insurance.In the case, the court has ruled out three basic requirements which must be fulfilled in order to have a valid insurance. First and for most, the policy must provide some benefit or legal entitlement for the insured on the occurrence of some event. In other words, if the insured items were damage, the insured are bound to benefit from the policy in either getting the goods replaced or monetary compensation.

Secondly, the occurrence must involve some element of uncertainty and the occurrence must be one of which outside the control of the insured. However, there are exceptions to the rule. Firstly, certain events are not able to be insured for example the deterioration of perishable goods or wear and tear. Secondly, Insurance recovered must not be his own wrong unless it is a negligent act. For example, if the insured has recklessly kicked a ball and injured his leg, he will still entitle to an insurance claim although he had deliberately kicked the ball. However, the recklessness can served as a form of negligent and thus allows him to claim for compensation. (not happy think of a better example)

Finally, the occurrence must be one which is prima facie adverse to the interest of the insured. It must be something which the insured wish to protect and also, the insured must have sufficient interest to the subject matter. For example, in the case of Macaura v Northern Assurance. In the case, the insured owned a company, Irish Canadian Sawmills ltd. However, he had insured the timbers in his own name with the respondent company. Unfortunately, a fire broke out and destroyed all the timbers. Macaura then claim for compensation but the court reject the claim and ruled out his interest in the timber. Apparently he had created an insurance in his own name but the timbers belong to the company. Therefore, he has no legal or equitable interest to the timber at all and thus, there is no sufficient interest in allowing a valid claim.

These are the requirements which used to identify a valid insurance. Failure to comply with one of them might make the insurance void.

What is soft law instrument?

Definition for soft law can get tricky. It sometimes defines as a non-binding agreement and it is not readily enforceable per se. Based on Wikipedia.com, quasi-legal instruments which do not have any legally binding force, or whose binding force is somewhat "weaker" than the binding force of traditional law is referred as the term "soft law". On contrary, "hard law" is those that often contrasted with soft law. However, it can take many forms such as declarations, general norms or legal principles.

Theoretically, soft law is a non binding instrument and it is often treated as a piece of agreement with no actual substance. It does not have an immediate effect on the agreement and further ratification is needed in order for the soft law to be a binding rule for a state. The lack of binding effect often relates the rule as merely a form of ethnic which is not enforceable. Aside from being not binding, soft law instrument is often treated as a form of political or moral commitment among state to build up a healthy international relationship. However, this is inaccurate. An agreement is a binding contract; nevertheless, it will contain at least some enforceable legal effect.

Income Tax Act 1967

Issue: Lee Corporation decided to pay a bonus to all employees who have been with the company for more than 6 years. The directors passed the resolution on 10 December 2007 to the effect that all employees who had been with the company for 6 years or more were to be paid a bonus of RM 2,500. The money was actually received by the employees on 5 January 2008.

Answer: : Under Section25(1) of ITA 1967, where gross income from an employment is not receivable in respect of any particular period; and first becomes receivable in the relevant period, it shall when received be treated as gross income of the relevant person for the relevant period; the bonus was not payable in respect of any particular period and therefore, when received by the employee, must be taken into account as gross income for the basis period in which the income was first receivable. The amount was first receivable when it was voted by the directors on 10 December 2007 and is, therefore, to be taken into account in calculating gross income for the year ended 31 December 2007.

Distinction between will and a secret trust

All will must be drafted in writing, approved in signature and witnessed by two witnesses is clearly stated in Section 9 of the Wills Act 1837. Failure in doing so will render the will void. In short, a will can be treated as a contract for inheritance of property. However, the creation of secret trust has created a breakthrough in the area.

Secret trust allows trust to be created without going through all the formalities but a simple oral agreement is valid. A secret trust is a trust which is not disclosed of any information and often made in secrecy. There are basically two types, fully secret trust and half secret trust. Half secret trust is one which is written in a will but the terms of the trusts are not disclosed. Such creation has help to smoothen the harsh law and furthermore, under the landmark case of secret trust, the case of McCormick v. Grogan had further developed the law.

Difference between Fraud and Misrepresentation

As written in the note, Fraud operates whenever a person causes another to act on a false representation that he himself does not believe to be true under section 17 Contract Act. As for Misrepresentation, it said that is a false statement made by one party which induces the other to enter into a contract, but the person who made such presentation thought it was true under section 18 Contract Act. There are few types of fraud such as insurance fraud, welfare fraud, election fraud and so on. Misrepresentation included innocent misrepresentation, negligent misrepresentation and fraudulent misrepresentation. What is the difference between fraud and misrepresentation?

According to Bench & Bar, it said that the difference between fraud and misrepresentation is that not all misrepresentation is fraud, but almost all fraud involves misrepresentation. Fraud is always done intentionally whereas misrepresentation can be done intentionally or negligently. Based on Wikipedia.com, it said that fraud always have malicious intent; misrepresentation may not have malicious intent to deceive if it happens negligently through a misstatement and/or omission to have material act(s).

One of the example for fraud: If the plaintiff wishes the buy a house from the defendant, the defendant know that the house is infested with termites. But the defendant's actual representation that the house is free from termites coupled with the plaintiff's reliance upon that representation might support a subsequent action by the plaintiff for fraud. In this case, the defendant is making fraud as he has the intention to hide the actual facts from the plaintiff about the termites. Therefore, the plaintiff can sue the defendant under section 17 Contract Act.

Another example for silent fraud: A defendant is selling a car to the plaintiff where the defendant knows that the odometer had been rolled back. The defendant knows that most of the people will rely on the odometer to decide whether to purchase the car or not. Therefore, the defendant did not tell the plaintiff about the odometer is not accurate. It is likely that the defendant's silent under these circumstances would support a subsequent action for silent fraud. Silent fraud can be occur when defendant failed to disclose material facts. From the example above, it shows that the defendant is hiding some information from the plaintiff. The defendant assume that since the plaintiff didn't ask the defendant about the odometer, then the defendant can just ignore it and continue hide it from the plaintiff. To prove that the defendant is against the law of Contract Act, the plaintiff has get some convincing evidence such as

-the defendant has actual knowledge about the fact(s)

-the defendant failed to disclose one or more material fact(s) about the subject matters

-the defendant failed to disclose the material fact(s) that cause the plaintiff to have false impression

-when the defendant failed to disclose the material fact(s), the defendant knew that the failure would create false impression

- the plaintiff relied on the false impression

Did J&J Plan to Break Rules?

Here is the link of the article:

http://www.businessweek.com/magazine/content/10_12/b4171068582130.htm?chan=magazine+channel_what's+next

In my opinion, this is one of the case study of unilateral offer. As we know, there is two type of offer which are bilateral offer and unilateral offer. Bilateral offer is made for two or group of persons. There is always requires acceptance. As for Unilateral offer, it is said to be "capable of being made to the world as a whole". Carlill v. The Carbolic Smoke Ball Company Ltd. is one of the case study on Unilateral offer. In the article above, the producer owns a contractual duty to all his consumers. This related to the case mentioned above. The producers give unilateral offer to his consumers. As a result, he was sued by his consumers. To make an unilateral offer to be binding, the terms of offer must be clear and offer must be made with intention of being binding.