Introduction

We enter into contracts every day. These contracts are made orally e.g boarding a bus buying a coffee at a shop, buying a reload phone card. However sometimes written contracts are required, such as when buying a house a car. A contract means that there is an agreement between two parties which is enforceable by law. Offer and acceptance analysis is a traditional approach in consideration and intention to create legal relationship between the parties. The others are consideration and intention to create legal relationship between the parties in forming a contract. The Law of Contract in Malaysia is governed by the Contract Act 1950. Section 2(h) states that an agreement enforcement by law is a contract.In this assignment need to required an agreement, and hire purchase agreement have been chosen to be discuss on. This hire purchase agreement is about Tan Siok Ching as a buyer and Mohamad Amran Bin Mohamad Mazuan as a seller car Nissan Teana 2.0L XE CVT and to implement the five element of valid contract in this agreement is Proposal/Offer , Acceptance , Intention to Create Legal Relation , Consideration , Capacity and Free Concent.

ELEMENT OF A VALID CONTRACT

PROPOSAL OR OFFER AND ACCEPTANCE

Where the agreement is reduced to writing there is usually little doubt about the existence and content of the agreement. On other occasions, there may be doubt whether , when and , if so , agreement was reach. In order to investigate such a situation , the law uses two-stage analysis proposal(offer) and acceptance.

Proposal is made when one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence.

When the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted.

The first step towards creating a contract is that one person shall signify or make a proposal or offer to the other, with a view to obtaining the acceptance of that another person to whom the offer is made. A proposal when accepted become a promise.

When the person to whom the proposal is made signifies his assent there of the proposal is said to be accepted. A proposal is when accepted becomes a promise. When there is a proposal and acceptance, there is an agreement made between these parties

The Offer Must be communicated Must be definition/clear statement Can be revoked at any time prior to acceptance. Can be individual or all people. Must be reach to other person. Must be distinguished from an invitation to treat which is where a party communicates that it is prepared to enter negotiations with a view to forming a contract. The Acceptance Must be communicate Unconditional and absolute The process made with reasonable time The process made with reasonable time Must be the offer made , otherwise it could be a counter offer.