Tutorial Tu torial Questions Chapter 1 1.
Why do you you thi think nk as as a bus busin ines ess s stu stude dent nt you you nee need d to have have some some kno knowl wled edge ge of of the the law law? ?
2.
What What are are the the maj major sour source ces s of of law law in Si Singap ngapor ore? e?
3.
What What are are som some e of the the mai main n diff differ eren ence ces s betw between een civ civilil and and cri crimi minal nal proc procee eedi ding ngs? s?
.
!n the the fol follo lowi wing ng sit situat uatio ions ns cons consid ider er the the typ type e of pro proce ceed edin ings gs the the par parti ties es may may fac face" e" a.
#lan #lan tak takes es $oe $oe%s %s han hand d phon phone e by pick pickin ing g the the lock lock on on $oe% $oe%s s lock locker er and and sel sells ls itit to &im.
b.
#fte #fterr a nigh nightt of dri drink nks s Shar Sharin in dri drive ves s home home and and whi whils lstt driv drivin ing g knoc knocks ks dow down n a cyclist. Sharin panics and drives home.
c.
' (te &td orders a container ner load oad of roses in anticipation of demand and on )alentine%s *ay. $ohn ordered a large bou+uet of roses for his fianc, to be delivered on )alentine%s *ay. -he roses arrived on the morning of the 1th of /ebruary. ' (te &td could not make the delivery to $ohn%s fianc,0 who promptly called off the engagement. -he rose supplier demands payment and $ohn is furious.
.
What What are are the the some some meth method ods s of of res resol olvi ving ng civi civill dis dispu puttes? es?
.
*isc *iscus uss s what what the the part partie ies s may may do in in civi civill proc procee eedi ding ngs s in the the fol follo lowi wing ng sit situa uati tion ons" s" a.
$ane $ane len lent 10 10 to 4ike 4ike who who prom promiised to re repay pay the the 10 10 wit within hin thre three months. -hree months have lapsed and although $ane demanded payment 4ike has not paid. $ane wants to take legal action.
b.
Simon comm ommenced an action in the *istrict 5ourt against his renovation contractor. -he -he court dismissed the claim. Simon is unhappy with the decision.
c.
$ack $ack com comme menc nced ed an an acti action on in in the the 6igh 6igh 5ou 5ourt rt aga again inst st his his for forme merr part partne nerr. -he -he tri trial al date is three months away. Simon is in two minds about having to testify in court0 cross e7amine his former partner who used to be a close friend and bringing into open court the dealing within the partnership.
d.
$)S $)S &td is a larg arge shi ship8bu p8buiilding ding com company pany.. !t enter entered ed into into a cont contrract act for for the construction of a super tanker0 built and delivered the tanker. -he -he ship8owner now claims the tanker did not meet the specifications stipulated in the contract. $)S &td disagrees. $)S &td feels that if the matter goes to court the court may not appreciate the technical process involved in building a tanker and would have little or no understanding of the meaning and effect of the specifications in the contract.
9.
:ame :ame some some of the the met metho hods ds of enfo enforc rcin ing g civ civil il judg judgem emen ents ts..
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Introduction to Business Law in Singapore: Instructor’s Manual
;.
#li #li was was rece recent ntly ly mad made e a bankr bankrup upt. t. *is *iscu cuss ss som some e of the the rest restri rict ctio ions ns he he may may face face as as a bankrupt and how he can get out of the bankruptcy. bankruptcy.
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Tutorial Questions
Chapter 2 1.
What are the four elements that have to be satisfied so that a contract will become enforceable?
2.
#re there enforceable contracts in the following situations? a.
entering the turnstile at the 4<- station
b.
making an order at the counter at a fast food restaurant
c.
ordering a bowl of noodles at a hawker centre
d.
opening an account in a bank
e.
signing a proposal form for life insurance
f.
attending an interview for a job
g.
taking a course of study at a university
h.
parking your car at an 6*= car park
i.
promising to donate 10 to a charity
j.
your parents promising you a trip to 6awaii0 if you obtain #s in your e7aminations.
3.
&ions (te &td wants to fit all its trucks with satellite tracking devices. !t calls for tenders and #pce &td0 a specialist in such devices0 submitted the lowest bid when the tender closed. Subse+uently &ions (te &td decided not to proceed with the e7ercise and informed #pce &td. #pce &td is furious as it spent nearly 20 on preparing the tender bid. #pce &td wants to take action against &ions (te &td.
.
-an > Sons sent a fa7 to 6ero7 &td and ($ &td to +uote for three copier cum fa7 machines. =oth companies +uoted the same price. -an > Sons then sent a similar fa7 message to each company stating that the other company had offered them a discount and asked if the company could better their offer by offering a more competitive discount and asked it to respond within seven days. 4eanwhile the media reported that the $apanese yen is on the rise. :either company responded. -an > Sons0 fearing that prices may rise0 sent a fa7 to 6ero7 &td agreeing to accept its offer. 6ero7 &td refused to supply. -an > Sons wants to take action against 6ero7. #dvise -an > Sons.
.
4ike and @ill go to #ngelo%s
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Introduction to Business Law in Singapore: Instructor’s Manual
.
Sam sent a letter dated the th of 4arch making an offer to book a room at 6astings 6otel in #laska from the 23rd to the 3th of #pril. -he hotel receives the letter on the ; th of 4arch and the hotel replied accepting the offer on the Ath of 4arch and the letter is received in Singapore on the 13th of 4arch. #s Sam%s mother suddenly became seriously ill0 Sam decided to cancel the trip and sent a letter cancelling his booking on the ;th of 4arch and it reaches the 6otel on the 1th of 4arch. !s Sam obliged to take up the accommodation? What if the communications were by e8mail and Sam sent his offer on the th0 his revocation on the 9th and the hotel sends its acceptance on the th and is received on the same day? Would there by any practical difficulties in enforcing the claim?
9.
4ike offers to sell $ames his 4(83 player for 1 and states that he will keep the offer open for five days. Bn the third day @ina offers 4ike 11 for the 4(83 player and 4ike sells it to @ina and informs $ames of this. *oes $ames have any right to complain? 6ow should $ames have protected himself?
;.
&im > Sons enters into a contract with C to buy goods which are lying in C%s warehouse. -he contract price is 2 per kilo. #fter the contract is signed0 and owing to a government control on imports0 there is a shortage of this type of goods in the market. C wants to use this opportunity to ma7imiDe his profits and doubles the price. &im > Sons needs the goods as they are already committed to third8party buyers so they agree to pay the increased price under protest. Bnce the goods are delivered0 &im > Sons only pays C0 2 per kilo. #re they obliged to pay the balance?
A.
/oo employs Cahid as a public relations e7ecutive. -he contract is silent on bonuses. !n *ecember 230 he promises C two months% bonus. !n $anuary 20 /oo tells Cahid that there was an error in the accounts and that the company has suffered loss0 and therefore0 no bonus will not be paid. 5an Cahid sue /oo for the bonus?
1.
5hong entered into a contract with -an to renovate his house. 5hong wants to take a si78 month holiday in 5hina and wants to get his son and another sub8contractor who has been with him for some time to take over the contract. 5an 5hong transfer the contract to his son and his sub8contractor? !f -an does not want the contract to be sub8contracted0 how could he have protected himself?
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Tutorial Questions
Chapter 3 1. &im0 a 4alaysian0 wants to work in Singapore and enters into an employment contract with ( &td. -he working hours are ; a.m. to 1 p.m. daily e7cept for Sundays and public holidays. -he salary is 109 per month with no entitlement to overtime pay. Bther companies in Singapore usually pay 209 for a similar position and their employees generally work only from ; a.m. to p.m. #fter working for si7 months &im feels that he is unfairly treated and he wants to challenge his employment terms. !s he entitled to do so? #fter a few months0 ( &td completely stops paying &im his salary as it is facing financial difficulties. 4ust &im continue working for ( &td? 2. $)' has written a book entitled Students’ Guide to Economics. Seven out of 12 chapters in the book are copied from $ansen%s book called Econs Made Easy . $)'%s book is published by #ppleson (ublishers. $ansen sues #ppleson (ublishers for breach of copyright. 5an #ppleson (ublishers sue $)' for breach of contract? 6ow could #ppleson (ublishers have protected its rights better? 3. -an goes to (iDDa )ille0 which advertised that it would deliver all orders to the table in 2 minutes. 6e orders a large piDDa and some garlic bread and drinks. /orty8five minutes have passed and the food has not arrived. 5an he walk out of the restaurant without paying? .
a.
E is an employee of F 5ompany which specialises in house removals and which has a fleet of vehicles. E0 usually a hardworking employee0 forgot to attend a meeting with an important client on a particular occasion. 5an F 5ompany terminate his services?
b.
E has been using the company%s vehicle to transport goods after office hours without the company%s knowledge. Since E offers cheaper rates than F 5ompany0 he has been diverting business from F 5ompany to himself and has been making huge profits. 5an F 5ompany terminate his services?
. E 5ompany ordered computers from C 5ompany to be delivered on the 1st of $une. C 5ompany arrives two days late to deliver the computers. #dvise E 5ompany. . $ill drives her car to a car park at a shopping centre. She presses for a ticket and a ticket is issued. -he ticket states in Gnglish that the management is not responsible for any loss or theft and injury to customers. #s $ill returns from her shopping another customer steps on $ill%s foot. $ill who was wearing high8heeled shoes stumbles and falls. She picks herself up and limps to her car. #n overhead pipe becomes dislodged and falls on her just as she is about to reach her car and she is injured. When she reaches her car she finds that her car had been broken into and her cash card and stereo have been stolen. 5an she sue the car park management for the injuries suffered and valuables lost? Would
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Introduction to Business Law in Singapore: Instructor’s Manual
your answer be different if there was also a notice at the entrance e7cluding liability in similar terms? Would any of your answers be different if $ill is illiterate or cannot read Gnglish? 9. E is a transport company. F0 another big company0 engages it to transport goods to -hailand. -here is a clause in the contract0 which limits liability for damaged or lost goods to 13 a kilo. F was given an option of agreeing to a larger limit of liability by paying an additional sum of money. F did not take up this option. -he goods are transported and some of the goods are damaged in the process of transportation. !s the limitation clause valid?
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Tutorial Questions
Chapter 4 1. $amie recently won some money on -oto and wants to invest it to get ma7imum returns. 6is friend told him that the easiest way was to lend money to persons who cannot get credit from financial institutions or licensed money lenders as they are prepared to pay substantially higher interest rates and he could easily double his money in no time. $amie decides to try his hand at it although he does not have a money8lending licence. 6e lends #h 6eng 20. #h 6eng does not pay up when the loan becomes due. 5an $amie sue #h 6eng? What if instead of lending money $amie sold #h 6eng pirated 5*s on credit terms and #h 6eng now refuses to pay? 2. *onna has a pet food shop in 6olland )illage selling pet food. She is tired of the hot weather in Singapore and decides to migrate to :ew Cealand. -herefore she sells her business together with all the stock for 0 to Cenna. -here is a clause in the contract of sale which states that *onna will not for a period of ten years after the sale0 set up any other business dealing with pets or pet foods or pet grooming in the 6olland )illage or =ukit -imah vicinity. #fter si7 months *onna is bored of :ew Cealand and decides to come back to Singapore and set up a pet shop in 6olland )illage. #dvise her whether she can do so. 3. $ing joins 5oral 5ompany as a marketing e7ecutive after graduating from a local polytechnic. 6is employment contract provides that $ing is not to work for a similar business anywhere for two years after he leaves 5oral 5ompany. $ing resigns after giving notice and joins Calte7 5ompany as an accounts e7ecutive. 5oral 5ompany is refusing to pay $ing%s last month%s salary because it says $ing breached the terms of the employment contract. #dvise $ing. . #dvise the parties in the following situations" a.
=illy is a 28year8old polytechnic student. 6e bought a hand phone which was advertised to be the latest model with all kinds of new features. 6e thinks it is a great buy and shows it off to all his friends in the polytechnic. -wo weeks later the manufacturer unveils an improved model. =illy is furious and wants to get out of the contract on the ground of his infancy. 5an he do so?
b.
!f =illy had obtained 38day credit terms from the shopkeeper and had not paid for the phone and now refuses to pay can the shopkeeper sue him?
c.
#t about he same time =illy ordered a suit Hhis firstI to be made for his sister%s wedding. 6is sister decides to cancel the wedding and =illy has no use for the suit and decides to cancel the order. -he tailor is furious and wants to sue him. 5an he do so?
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Introduction to Business Law in Singapore: Instructor’s Manual
d.
=illy works part8time as a waiter in #ngelo%s
. *r &ee0 a dental surgeon0 wants to sell his dental practice to *r :g who recently returned to Singapore after spending si7 years in #ustralia. *r &ee tells *r :g that 6*= will be e7tending the satellite town to include several new neighbourhoods in close pro7imity to the clinic and that with new people moving in0 the business would bound to double or even triple. *r &ee asks *r :g to check with 6*= to verify this. *r :g decides to buy the business0 partly because he is sentimental about the area as he had lived there as a child and partly because of *r &ee%s representations about the new developments in the area. #bout nine months later *r :g met a former classmate who is working in 6*= and the classmate tells him that 6*= has no plans to carry out any developments in the area in the near future. *r :g is furious and wants to rescind the contract and get back his money. 5an he do so? !f he waits for two years after he finds out the truth and then decides to take action0 is he likely to be able to rescind the contract? . 5onsider if there are undue influences or mistakes in the following situations" a.
Simon is sued by a creditor. 6e engages &im0 a lawyer0 who successfully defends him and the case against Simon is dismissed. &im attends a party at Simon%s house to celebrate the success. &im%s wife loves Simon%s house and the neighbourhood in general. &im asks Simon if he wants to sell the house to him. Simon agrees to sell the house at 1 million which Simon says is a fair price. -wo weeks later Simon meets his neighbour who tells him that he has just sold his house for 1.2 million. Simon is unhappy and wants to get out of the contract.
b.
#bigail is an old illiterate lady. She relies completely on her favourite niece #ngel for everything. #ngel asks #bigail to sign a document which she states is a survey form on the needs of the elderly which #ngel had filled up for her. #bigail puts her right thumb print on the document. !n fact the document is an application for a loan by #ngel from a bank and a guarantee given by #bigail for the loan as security for the loan. -he form authorises the bank to lodge a caveat on #bigail%s house.
9. -ay orders goods from 5hing > 5o. 5hing > 5o. delivers the goods to -ay%s warehouse and asks #h 4eng0 -ay%s warehouse clerk0 to sign the delivery order. -he delivery order acknowledges that 3 items have been delivered. !n fact0 only 2; items had been delivered. 6owever0 #h 4eng without checking this signs the delivery order. 5an #h 4eng or -ay claim that #h 4eng signed the delivery order by mistake without reading and sue 5hing > 5o for the shortfall?
8
Tutorial Questions
;. 6enry > 5o gets 5hye to transport its goods to a factory in $urong. 5hye +uotes per kilo but once loading commences 5hye slows down and refuses to continue loading unless 6enry > 5o pays 9 per kilo which 5hye says is the market rate. !t is the :ew Fear season and 6enry > 5o needs to deliver the goods urgently to its customer. 6enry > 5o is already late and its customer has threatened to sue unless the goods are delivered within the day. !t would also be difficult to get other transporters at such short notice. So although 6enry > 5o protests vehemently0 it agrees to the new price by signing a deed. 4ust 6enry > 5o pay the new price after the delivery is made?
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Introduction to Business Law in Singapore: Instructor’s Manual
Chapter 5 1.
6arjeet gets -- -rans &td to transport some E8ray machines from Singapore to Shanghai via 6ong 'ong. -he machines are part of a larger consignment and are to be repacked and transshipped in 6ong 'ong. $ane0 an employee of -- -rans &td0 mistakenly inserts the place of delivery as ShenDen. -he goods have arrived in ShenDen and have been seiDed as these are controlled goods and no customs clearance has been applied for. -- -rans &td wants payment before they will arrange for the goods to be collected and sent to Shanghai. !s -- -rans &td entitled to any payment? What if the goods were delivered to an incorrect address in Shanghai instead?
2.
$ack orders wedding cards to be printed. #fter the initial layout work had begun0 $ack cancels the order as he has found a cheaper printer. !s the printer entitled to payment since he has not completely performed his obligations under the contract?
3.
# enters into a contract with =0 under which the latter is to supply 1 tons of rice. #fter the contract is concluded0 # and = agree to cancel the contract. 5an = later change his mind and demand that # accepts the rice?
.
$ames agrees to supply :ick with poultry. $ames% own supplier fails to deliver and $ames is unable to fulfil his contract with :ick. !s $ames liable for breach of contract or can he successfully plead frustration? !f $ames finally gets the poultry from an alternative supplier and is willing to supply :ick on the due date but :ick does not want the poultry as there has been a bird flu scare0 can $ames get out of his contract with the alternative supplier on the grounds that his buyer does not want the poultry any longer and $ames himself does not want the goods?
.
5harlie agreed to supply #ndrew with plastic chairs. #fter the contract was entered into0 the market price of cost of raw materials rose by about 2 and further0 some of 5harlie%s key workers have resigned. !t is unlikely that 5harlie can meet the deadline stated in the contract and he would suffer a loss as a result of increase in the cost of raw materials. 5an 5harlie be e7cused from performing his obligations under the contract?
.
-ing is in the car rental business and has a fleet of cars. 6e agrees to rent a limousine to
9.
W0 an !ndonesian0 agreed to sell goods to C0 a Singaporean. -he goods were to be shipped from (ort $ only. 6owever0 a labour dispute has broken out and there are strikes in (ort $ making it impossible to ship the goods from there. Will W be in breach of contract if he does not ship the goods as a result of this? What if there was a force
10
Tutorial Questions
majeure clause in the contract stating that time for performance will be e7tended if there are custom delays0 strikes0 riots or civil disturbances in (ort $? ;.
&im0 a retired accounts clerk0 is engaged by -an (te &td to draw up the company accounts. -an (te &td paid &im a deposit. Shortly after &im started drawing up the accounts but before completion0 &im dies. #dvise &im%s estate if they have to complete the contract.
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Introduction to Business Law in Singapore: Instructor’s Manual
Chapter 6 1. $enn0 a model0 joins a tour organiDed by @oose -ours and is injured in an accident which is caused by the negligence of @oose -ours% driver. $enn is hospitalised for one week and as a result is unable to take on a modelling assignment. #dvise $enn as to what she can claim for. 2. Bn the 1st of $anuary0 6ui enters into a contract with $in to sell $in his motorcycle. 6ui needs the money urgently as he intends to invest the proceeds of sale in a particular share counter on which his stockbroker friend has given him a tip. 6owever0 on the 3rd of $anuary $in tells 6ui that he can%t buy the motorcycle as he cannot secure the financing. 6ui who has been dreaming about the shares0 gets a heart attack when he hears this. #ssuming the market price of the motorcycle has not changed0 advise 6ui as to his remedies. 3. # building contract provides that for every day of delay in completion of the building0 li+uidated damages of 1 per day is to be paid. -he completion is delayed by 2 days due to the fault of the contractor. 6ow much can the building owner claim if the actual loss suffered is 10? . $ohn agreed to sell a machine to Cinnia at 20. $ohn did not supply the machine to Cinnia as re+uired under the contract. #s a result0 Cinnia could not operate her business and is greatly distressed as this is her first venture. !t is established that Cinnia could have got a similar machine at appro7imately the same price from another supplier within a few days of the breach. What damages would Cinnia be able to claim? . Bn the 1st of 4ay C0 a car dealer0 enters into a contract with E0 under which E agrees to buy a car for 130. Bn the 2nd of 4ay0 E cancels the order as he cannot get financing. -he market price of the car has remained the same. What are C%s remedies? What if C collected a deposit of and the contract provided that all deposits are non8refundable and will be forfeited if the buyer cancels the order? !f C is in breach of contract and does not want to sell the car to E0 what happens to the deposit? . #llen contracts to sell his house to =en0 but later changes his mind as he has been living there for a long time and cannot bear to part with it. -he price of similar houses has gone up by at least 1. What are =en%s remedies? 6ow +uickly must an action be brought? 9. E enters into a lease with C0 the landlord. !t is provided in the contract that E will not sub8let the property. E sub8lets the property. 5an C get an injunction? ;. $im has been unlawfully dismissed by Fen who is his employer. Fen is willing to pay damages for the breach. $im wants Fen to re8employ him. 5an $im so insist? What if $im has unlawfully resigned in breach of the contract and $im is now willing to pay damages but Fen wants $im to come back and work for him?
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Tutorial Questions
A. !n 1A;9 $enny sells William a painting which $enny fraudulently claims is an original (icasso. William buys it0 and then in 20 he tries to sell it at an art auction. -he buyer0 an art e7pert and collector0 tells him that the painting is not an original (icasso but a bad copy. 5an William make any claims against $enny? 1. 4ichael E%son0 an internationally famous pop star0 has been engaged by F (roductions for a concert in Singapore. -hus far0 F (roductions has spent 0 in promotions and all the tickets have been sold out. 4ichael E%son is badly affected by a se7 scandal that has broken out in his home country and cancels the concert. !f the concert had gone on0 F (roductions would have made 20 in net profits. #dvise F (roductions as to the damages they can recover from 4ichael E%son.
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Introduction to Business Law in Singapore: Instructor’s Manual
Chapter 7 1. $im%s car is stolen by =en and sold to Fan. Fan then sells the car to 4ing. $im informs the police and traces the car to 4ing0 who is forced to return it to $im. What can 4ing sue Fan for? 2. E holds a garage sale in her house and sells to = a handbag which she says is made of genuine leather. -his is an untrue statement. E also sells = an electric rice cooker which looks used for 3. When = goes home0 he finds that the rice cooker has some problems but can still be used. = also discovers from a friend who is a leather goods dealer that the handbag is not made of leather. #dvise = as to his remedies. 3. Eina runs a designer bouti+ue at an e7clusive shopping centre. -ai -sai buys a designer outfit for just 20. When she goes back she sees that there is a very slight tear on the collar. #dvise her of her rights. What if the contract stated that goods once sold cannot be returned? What if she goes to the bouti+ue a month later to return the outfit? What if the reason for wanting to return the outfit was that she did not like the colour or siDe? -ai -sai also bought a blouse at a discounted price of 3 from F shop. Bn the blouse there is a tag stating that the blouse must be dry cleaned and not machine washed. :ot reading this0 her maid happily puts the blouse into the washing machine and the blouse is damaged. #dvise -ai -sai. What if there was no such tag and it was not obvious that the blouse could not be machine washed? . $ane wants to buy a stain remover to remove some stains on her wall. She goes to
14
Tutorial Questions
What if the contract provides that goods sold could be refunded if the goods were returned within three days of purchase and -im comes after the th day? What if the contract provides that goods sold could be refunded if the goods were returned within three days of purchase0 but the calculator was not defective and -im comes after three days? 9. -an orders 3 bottles of a drink for his drink stall from &im. -he bottles are sent on a truck to -an%s shop two days later. Bn the way to the shop0 the truck collides with another truck due to the negligence of &im%s driver0 and the bottles are damaged despite the p ackaging. 4ust -an pay for the 3 bottles? ;. E sells =0 a sole proprietor0 jewels on credit terms. !t is stated in the contract that property in the jewels will pass to = only when = has paid for the goods0 but the risk will remain with = from the time of delivery. What happens if =%s shop is robbed and the jewels are stolen or bankruptcy proceedings are commenced against =? A. E0 a retailer0 orders 1 bags of rice from F. -he contract provides that F is to deliver the rice. F delivers 12 bags of rice. What are E%s rights? What if F delivered 11 bags of rice? What if E accepts 1 bags0 but does not pay for it L what are F%s rights assuming E has become insolvent and the contract is silent on the passing of property and intention of the parties in this regard cannot be gathered from the circumstances? 1. E bought a brand new -onica camera from C shop and when he brings it home0 it does not work properly. #dvise him as to his rights against C shop and -onica who are the manufacturers. 11. E who is in $apan ships a cargo of computer parts to C in Singapore. -he contract states that risk passes to C upon shipment. -he goods are completely damaged due to a storm at sea. #dvise C. 6ow could he have protected himself? 12.
F sells goods to 40 a sole proprietor0 on credit terms and the contract provides that property would pass to 4 only when 4 pays the purchase price. -he contract also provides that if 4 sells the goods0 4 must hold the sale proceeds on trust for F. 4 then sells the goods to C. 6owever0 before paying F0 4 becomes bankrupt. *oes C get good title to the goods? What if the goods were stolen from 4Ms shop by ( and sold to C instead?
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Introduction to Business Law in Singapore: Instructor’s Manual
Chapter 8 1.
*iscuss if 4ark is an employee in the following situations" a.
4ark is asked to attend at a construction site from A a.m. each day till the construction is completed for the day and take over the carpentry work for the building being constructed. 6e is to be paid a salary of 1 per day and is allowed to hire others to help him but he must pay the workers from his salary.
b.
4ark is given an assignment to write a book by E (te &td. 6e is to be paid per day and the work is to be completed within days. -he company agrees to make 5(/ contributions.
c.
4ark works in a night club as an escort. -he night club pays him of the tips he receives for services rendered to the customers at the nightclub. 6e has to take instructions from the supervisor at the night club.
2.
$ames is employed by #<5 &td. 6is job title is Jadministrative officerK. 6e was told at the job interview that he would have to ensure the smooth running of the office. $enny0 the receptionist0 is suddenly taken ill and given medical leave for seven days. -he general manager instructs $ames to assume the duties of the receptionist. $ames is angry and says that the job is beneath the scope of duties of an Jadministrative officerK and refuses to carry out those duties. #dvise #<5 &td.
3.
-im works for *ingo =ank &td. 6is job is to verify all signatures for che+ues and ensure that the signatures conform to the specimen signature provided by the customers. !t is :ew Fear%s Gve and the bank receives a large +uantity of che+ues and -im is tired and wants to leave for the office party. 6e passes a few che+ues without checking. !t turns out that one of the che+ues was forged and the bank was sued by the account holder. #dvise the =ank.
.
4eng has worked as a delivery clerk for -S: > Sons for the past 2 years. -he employer has not revised 4eng%s salary for the past 1 years0 but gives him an ang pow of every 5hinese :ew Fear. 4eng finds it difficult to make ends meet. 6e takes on the duties of a junior delivery clerk with a neighbour of -S: > Sons. 6e is able to deliver for both organisations within his normal working hours. -S: > Sons is annoyed when they discover what 4eng is doing and seeks your advice.
.
&im works for #lbright !ntellectual Services (te &td as accounts e7ecutive. -he company provides head hunting services. 6is contract states that he cannot work for a competitor or set up a competing business in Singapore for a period of five years if he leaves his employment. &im resigns and sets up a business. =efore leaving he made copies of #lbright%s client list and their computations of market salaries for certain categories of
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Tutorial Questions
workers. When his former employers find out that he is setting up a business they threaten to enforce the restraint clause. &im seeks your advice. .
!n the following situations consider the duties of the employer" a.
$inny worked as a housekeeper in 4r Wong%s house for the last 12 years and recently retired. She recently found out that 4r Wong never paid 5(/ contributions for her.
b.
4ike works the night shift at a factory. 6e usually works on weekdays and gets Saturday and Sunday off. -he factory has an unusually large order to fulfil and the supervisor asks him to work on Saturday and take Sunday and 4onday off. 4ike is angry as Saturday is the day he plays football and then goes for drinks.
c.
4ark has worked with the same company for seven years. 6is contract makes no mention of annual leave. 6e wants 21 days but the company says he is only entitled to 1 days.
d.
4artia joined -F< &td as secretary si7 months ago. She now discovers that she is pregnant. She wants maternity leave but her employer is reluctant to let her go as they need her services.
e.
'ay is years old and is the oldest person in the company. 6er boss is half her age and thinks older works are inefficient and urges her to resign as otherwise the conse+uences will be bad for her. 'ay is distressed.
9.
-he hobby of #nthony0 a dentist0 is to make jewellery. Some of his patients have similar interests and he decides to get four of them to spend their evenings in a back room making jewellery. 6e pays them 1 per hour and they have a lot of fun together. #nthony usually sells the jewellery made to a hobby shop at Suntec 5ity. Bne of the patients is slightly injured whilst welding some jewellery. -he patient%s son complains to the authorities that #nthony did not provide a safe place for work. #dvise #nthony.
;.
4ani is a foreign worker working at a construction site. 6e starts work at 9 a.m. and has an hour%s lunch break between 12.3 and 1.3 p.m. 6e has a +uick lunch and joins his friends for a game of cards in one of the sheds at the site. # concrete slab strut falls off the building and onto the shed0 injuring 4ani. 4ani loses two fingers as a result of this accident. 5an he get any compensation for his injuries?
17
Introduction to Business Law in Singapore: Instructor’s Manual
Chapter 9 1.
&im orders goods on behalf of Cero (te &td. #dvise the company whether it is bound to honour the contracts entered into by &im if
2.
a.
&im is the managing director of the companyN
b.
&im is a non8e7ecutive director of the companyN and
c.
&im is an accounts e7ecutive in the company.
$oan runs a small hotel which is named $oan%s 6otel. FF &td purchased $oan%s business but retained the name of the hotel. FF &td also retains $oan as its manager. 6owever0 FF &td strongly believes that tobacco is detrimental to health and prohibits the hotel and $oan from selling cigarettes in the hotel. $oan who used to sell cigarettes when she was the owner of the hotel continues to buy cigarettes on credit terms and sell them without the knowledge of FF &td. 5an the supplier of the cigarettes sue FF &td for the price of the cigarettes purchased by $oan as manager of the hotel?
3.
.
$immy asks his stockbroker to buy four lots of *=S =ank shares. -he broker0 who has a very busy trading day0 forgot to e7ecute the order b efore the close of the trading day. -hat evening *=S =ank announced a major deal and the price of the shares went up by at least when trading opened the ne7t day. #dvise $immy.
.
4ark engages Simon0 a lawyer0 to represent him in a suit. Simon is heavily committed to several other cases and gets $ames0 another lawyer from another firm0 to represent 4ark at a hearing in court without seeking 4ark%s permission. $ames does a good job and wins the case. 6owever0 4ark is unhappy that he was not consulted before $ames was appointed and seeks your advice if he should pay the b ill presented by Simon.
.
&im has recently entered into a partnership with 5hing. &im buys some stationery and a printer for use by the firm at a warehouse sale of his former employer where he was able to get a further discount on the price which is not available to other customers as he was a former staff member. &im charges the firm the same amount ordinary customers would have paid for the goods at the warehouse sale. #dvise 5hing who subse+uently discovered the true price &im had paid.
9.
'ien appoints an auctioneer to put up for auction an original painting by a renowned painter. -he contract provides that the auctioneer will receive 2 of the gross sale proceeds as commission. -he auctioneer then goes about advertising the painting and the auction0 and incurs considerable e7pense. $ane0 who is secretly interested in the painting and not knowing that 'ien has appointed the auctioneer0 approaches 'ien to sell
18
Tutorial Questions
the painting to her. 'ien0 who is interested in getting to know $ane better0 thinks this would be a good opportunity to get closer to $ane and agrees to sell the painting to $ane at a price 1 below the reserve price at the auction and promptly calls off the auction. #dvise the auctioneer. ;.
4rs -an appoints #le7 an estate agent to sell her semi8detached house. #le7 has not made any sale for the last si7 months as the property market has been depressed and he is very keen to make a sale this time. 6e0 without the knowledge of 4rs -an0 tells a potential buyer that the property is 30 s+ feet and that it faces east when in effect it is only 20 s+ feet and faces north8west. -he buyer0 after inspecting the property0 enters into the contract to purchase. -he buyer discovers that the property is only 20 s+ feet when his lawyers carries out a search on the property. 6e is annoyed. -he price of the property has meanwhile dropped by 1. #dvise the buyer.
A.
$ames lives in @ermany. 6e owns a unit at =ayshore (ark 5ondominium in Singapore. 6e leaves it to Fuppie (roperty 5onsultants to manage the property which is tenanted out. -he property is in need of some minor repairs and Fuppie (roperty 5onsultants gets contractors to repair it for . Fuppie (roperty 5onsultants receives a commission of 2 of the invoice amount from the contractors for this job. !n the accounts rendered to $ames the cost of the repairs is stated as . #dvise $ames.
1.
@ill is the personal secretary of the managing director of EFC (te &td. @ill has been ordering the stationery on 8day credit on behalf of the company for the past seven years and the company has always paid the bill. Sometimes @ill slips into the orders some small items of stationery which her school8going sons need. -he managing director resigns and a new one is appointed. @ill cannot get along with the new managing director who is female. @ill resigns but just before she leaves she places an unusually large order of stationery and also places an order for fruits with #h &eng0 the brother of the stationer0 whom she got to know when visiting the stationery shop. -he fruits are for her personal consumption and she instructs #h &eng to send the fruits to her home. -he stationer and #h &eng send their bills to EFC (te &-* after the e7piry of the days. #dvise the stationer and #h &eng of their rights against @ill and EFC (te &td.
19
Introduction to Business Law in Singapore: Instructor’s Manual
Chapter 10 1.
-homas0 a Singapore resident0 is the sole proprietor of a provision shop. -he shop is rented. 6e owns a car which is used for both business and private purposes. 6e also owns a
2.
-an and Sim are in partnership running an audit firm. Sim carelessly audits accounts of ((S (te. &td. Sim also orders goods from C 5ompany which -an does not think is necessary for the business of the audit firm and so -an does not want to pay for them. Sim also uses some of the partnership%s e+uipment and stationery for his own company secretarial services company which is not disclosed to -an. Sim%s company secretarial services company makes a profit of 0 that year. #dvise -an.
3.
-homas takes some goods in JhisK shop for his personal use. What would be the conse+uences if"
.
a.
he was a sole proprietorN
b.
the shop was operated by partnership between him and EenoN or
c.
the shop was operated by an incorporated company?
-he directors of -elco (te &td have misappropriated funds belonging to the company. What can the shareholders do?
.
-he members HshareholdersI and only directors of Salem (te &td are (ang and -eo. =oth of them have substantial personal assets. -he company has incurred a debt of 10 and is unable to pay the same. #dvise the creditors. What if (ang and -eo when they set up the company knew that as shareholders they have no personal liability and thus ordered goods and services with no intention of paying for them?
.
(ierre and -erry intend to set up an art and craft shop. -hey anticipate running a small business with a small capital and they think the risk involved or the turnover will not be large. Should they set up a partnership or a company? What if after several years of operation0 the business prospers and there are huge opportunities for e7pansion?
9.
)isit #5<#%s website at www.acra.gov.sg and consider the following" a.
if you wish to give private tuition0 must you register it as a business?
b.
if you wish to set up a fish farm0 must you register it as a business?
20
Tutorial Questions
c.
!f you wish to set up a private school0 do you need approvals from other agencies?
d.
!f you are not a citiDen or permanent resident can you register a business in Singapore?
e.
!f you wish to set up a society or fan club0 must you register that society or club with #5<#? O#lso visit the website of the 4inistry of 6ome #ffairs and look for the
f.
!f you want to set up a hotel0 in addition to registration under <5=0 do you need any licences?
21
Introduction to Business Law in Singapore: Instructor’s Manual
Chapter 11 1. -ravis (te &td has adopted -able # of the /ourth Schedule of the 5ompanies #ct. -he directors appoint -an as their personnel manager. -an has a conflict with the majority shareholders0 and at a re+uisitioned meeting of the members0 they pass a resolution directing the directors to dismiss -an. -he directors refuse to obey. -he shareholders are also unhappy that one of the director%s mistresses has been appointed production manager of the company%s factory. She was the director%s personal secretary and has no previous management e7perience. -he directors also decide to increase their remuneration at a meeting of directors as they feel they are underpaid. #dvise the shareholders. 2. #aron0 =enny and 5harlie are directors of #=5 (te &td. Since 1AA;0 all three directors have failed to submit to the
Bng0 (ang and 5hew are directors of -echno &td0 a public company. -echno &td enters into a contract for the purchase of 10 tons of steel bars from F &td. Bng is a majority shareholder in F &td. -echno &td also gives a guarantee to a personal loan advanced by #=S =ank to (ang. #t a board of directors meeting0 it is revealed that the company is under investigation by the 5ommercial #ffairs *epartment. -his information is confidential and is likely to affect the price of the shares. 5hew0 on hearing this0 +uickly sells off half his shareholding in -echno &td. /eeling uneasy Bng0 (ang and 5hew seek your advice.
. Section 1 provides that a person0 who is persistently in default in filing documents0 would be dis+ualified from acting as a director. =esides the annual returns0 what are some of the other documentsQformsQnotices that the company has to file with #5<#? HSee www.acra.gov.sg forms and guides.I
22
Tutorial Questions
Chapter 12 1.
State if the following statements are true or false" a.
the members of a company may by special resolution resolve to wind up the company.
b.
the company is unable to pay its debts so the members may by special resolution resolve to wind up the company.
c.
the *irector of #5<# may present a petition to court to wind up a company.
d.
that the company has not commenced business within a year of incorporation and that it has suspended its business for a whole year are grounds to wind up the company.
e.
where directors have misappropriated the company%s funds the shareholders may seek to wind up the company.
f.
where the minority shareholders have been unfairly treated the court may wind up the company.
g0
where a petition has been presented for winding up on the ground that the company is unable to pay its debts the company must demonstrate to the court that it has the means to settle all debts.
h.
!f there is a serious deadlock between the shareholders and directors the court may wind up the company on the ground that it is just and e+uitable to do so.
i.
a winding8up order generally commences0 not on the date on which it is made0 but on the date on which the petition is presented.
2.
EFC (te &td has run into debts with several creditors. #=5 > Sons has obtained judgement and has issued writ of seiDure and sale against the assets of EFC (te &td. EFC (te &td presents a petition on the ground that the company is unable to pay its debts. Bn the presentation of the petition the bailiff tells #=5 > Sons that he is unable to proceed with the writ of seiDure and sale. #dvise #=5 > Sons.
3.
#*S (te &td is in financial difficulties and owes considerable sums to several creditors. Bne of its creditors is pressing very hard for immediate payment. -o appease the creditor the managing director offers the creditor some of the goods of the company presently lying in the warehouse. -he creditor takes possession of the goods and sells them to setoff the amount owing. #bout a year ago the company bought an office unit from one of its directors at about 2 above the mortgagee bank%s valuation. -he court has now made a winding order against the company and a li+uidator has been appointed. #dvise the li+uidator.
23
Introduction to Business Law in Singapore: Instructor’s Manual
.
.
/ollowing a winding up0 the following parties have lodged proof of debts" a.
5(/ =oard for 5(/ contributions for the last 12 months which were not paid by the companyN
b.
#hmad0 an employee0 for compensation due under the Workman%s compensation #ct amounting to 190N
c.
/iona0 an employee0 claiming vacation leave pay mounting to 20N
d.
$ames0 a former employee0 for two months salary amounting to 20N
e.
# > S &&50 for legal costs incurred in the winding upN and
f.
@oon0 for retrenchment benefits amounting to 0 which he forgot to collect when he was retrenched eight months ago.
#dvise the &i+uidator on order of priority of these claims. .
What is the main difference between receivership and judicial management?
9.
#S* (te &td has several creditors who are pressing for payment. -he company is on the verge of completing a large project in 4alaysia and e7pects substantial payment in a few months. With this payment the company would be able to pay off about 9 of its current debts. Sam0 to whom the company owes about . million is aware of the project in 4alaysia but is not prepared to wait. 6e feels that if he issues a winding8up petition the directors will use their personal funds to pay him off. -he directors seek your advice.
24
Tutorial Questions
Chapter 13 1. Garnest > #nderson are auditors for Gmrose &td. /or the years ended 31st *ec 22 to 2 the audited accounts presented at the company%s general meeting show that the company has made profitsN when in fact the company has made losses. Several banks rely on the accounts and e7tend Gmrose &td large credit facilities. -he banks eventually suffer huge losses and want to sue Garnest > #nderson. #dvise the banks. 2. # contractor while doing some e7cavation work carelessly damaged an underground pipe as a result of which water supply is cut off to some chemical factories in the -uas region. -he business of these factories comes to a standstill for about five hours and they suffer large financial losses. #dvise the contractor0 assuming there is no property damage or personal injury. 3. Bn the 1st of $anuary 2 at about 3 a.m. $ack was driving home after a party along -homson
25
Introduction to Business Law in Singapore: Instructor’s Manual
procedure is carried out by *r Who is an employee of the hospital. Caint dies during the procedure owing to complications. -his is +uite unusual in this type of surgery. Statistically only 1 in 1 persons suffers from the type of complications that Caint did. #dvise his estate. *o you think Caint consented to the the risk of the surgery? 9. Eanti0 an !ndonesian maid0 was instructed by her employer to stand on a window ledge and clean the outside of the window. Whilst cleaning0 Eanti leaned forward0 lost her balance0 fell 1 storeys and died. #dvise her parents. *o you think Eanti would have consented to the risk? !nstead of suing for negligence0 can Eanti%s family make any other claims or claim under the Workmen%s 5ompensation #ct? ;. Simon0 a stockbroker0 tells his long8time client Fang to invest in EFC &td knowing very well that Fang will act according to his suggestions. Simon believes that the company will do well financially. -he company suffers a loss and the price of its shares tumbles. Fang suffers a great financial loss and has to sell his house to settle the debts. #dvise Fang. A. -an brings his son to play in a public playground. While playing a wooden bar drops off and -an%s son fractures his hand. -here is a sign in the playground that states that the :ational (arks =oard will not be liable for any injuries or losses. #dvise -an. 1. #dvise on the employer%s civil liability for the employee%s following acts" a.
#n employee who has been provided with a company car visits his friend in hospital during his lunch break and whilst there injures a pedestrian in the hospital car parkN
b.
#n employee working in a petrol station0 throws down a cigarette he has been smoking which comes into contact with some petrol on the floor causing a huge e7plosion which damages the plaintiff%s carN and
c.
#n employee working in a laundry negligently damages a customer%s e7pensive suit.
11.
Fao%s *rinks% brand drink called
26
Tutorial Questions
Chapter 14 1. *r :o works as a researcher with @la7i &td0 a pharmaceutical company. !n 2 after years of research0 he develops a new wonder drug which could be used to treat dengue. 5an @la7i &td patent the invention? Shortly thereafter0 *r Feah0 another researcher0 also came up with a similar chemical compound after years of research. 5an *r Feah also apply for patent rights or make use of the compound to do research to see if it cures other types of insect8borne diseases? 2. =arker is a sole proprietor and has just started a bakery. She is unsure of what to call it. She comes to you for advise on registration of her trade name with the following alternatives L aI Singapore 5ake ShopN bI 5hu &ian 5ake Shop0 5hu &ian being her first nameN cI *elight 5ake ShopN dI -raD 5ake ShopN eI =angawan Silo =ake ShopN fI -5& 5ake shop. #dvise her. What if she finally chooses the name -raD and her business is a success L can some one set up aI a -ras =ake ShopN bI a -raD #rts > 5rafts shop in Singapore? What if =arker had not registered the trade name in the first place? =esides the trade name0 what else can the bakery register as a trade mark? 3. Cia writes several songs Hin GnglishI and the music composition for them. 6e gets Foyo 5ompany to record the songs and assigns the copyrights in them to Foyo 5ompany. Foyo 5ompany then releases 5*s containing the songs. 4ossade pirates these 5*s and sells them at a cheaper price. Bolala 5ompany using the same tunes produces a similar 5*0 but the lyrics are in 4andarin. 'lass :il0 a broadcast station0 plays the Gnglish version of the song on radio and 5harlie tapes it for his own private use. Ginstin 5ompany uses a song from the Gnglish version of the 5* in its advertisements as background music. *iscuss the rights and liabilities that arise. . #=5 &td is the authorised Singapore agents for =4W cars made in @ermany. -hey have the consent of the owner of trademark to use the trademark in Singapore in respect of the said cars. -eo is an eager businessman who imports =4Ws from the authorised agent in $apan. =y doing so -eo is able to sell the cars cheaper than #=5 &td. #=5 &td is unhappy and seeks your advice. . E7tra &td cuts out a photograph of model 5indy 5rawford from an advertisement in a magaDine and superimposes it on its own advertisement so that it appears that she is endorsing their products. *iscuss. What if E7tra &td took a picture of her during a public function and tried to use that picture instead in its advertisements? What if she came to their shop and the company took a picture of that and used it for advertising purposes? . #dvise whether there would be a copyright infringement in the following events" a.
Fou download a page from a websiteN
b.
Fou scan a picture into your web pageN
27
Introduction to Business Law in Singapore: Instructor’s Manual
9.
c.
Fou forward an e8mail to your friendN
d.
Fou play a 5* you bought in your roomN
e.
Fou play a 5* you bought in your house during a birthday partyN
f.
Fou play a 5* in a pubQbar you ownN
g.
Fou buy a book and make a copy of some pages for your friendN
h.
Fou buy a pirated software from a shop for your own usageN
i.
Fou video tape your brother who is playing in a football match0 and
j.
Fou video tape your brother who is acting in a professional theatre production.
$une E sets up a shop buying and selling second8hand jewellery. !t is the first of its kind in Singapore and it is a big hit. !nspired0 Fen subse+uently sets up a similar shop. 6owever0 the nameQget8up of FenMs shop is totally different. #dvise Fen whether he has breached copyright laws.
28
Tutorial Questions
Chapter 15 1.
G7plain briefly the difference between loans and overdrafts.
2.
What is the ma7imum rate of interest chargeable and can compound interest be charged on loans and overdrafts?
3.
Simon mortgages his house to a bank to secure facilities granted to
.
What type of charges can a company create? =riefly e7plain the difference between the types of charges the company may create.
.
Bther than assets such as land0 machinery0 e+uipment and stock8in8trade what other properties of a company can form the subject matter of a charge?
.
<-F (te &td has metric tonnes of rice which is due to be delivered to a customer in ten days% time. 4eanwhile0 <-F (te &td needs some funds to cover a trust receipt which has fallen due. #dvise <-F (te &td how they can use the goods in their warehouse to raise the necessary funds.
9.
$ason sent his sports car Ha (orscheI for some minor repair. -he repairer told $ason to come back within two hours to collect his car. $ason came back after two hours and saw that the repairer had completed the job and he was very pleased. -he repairer then presented $ason with a bill for . $ason reached into his pocket for his wallet and found that it was missing. 6e told the repairer that he will drive the car home0 get the money and come back and pay him. -he repairer told $ason that he will not release the car unless he is paid. $ason is angry that the repairer is holding on to his 10 car over a bill and calls you for advice.
;.
4ichael took a loan from *5S =ank to pay for his university tuition fees. -he bank re+uired two guarantors for the loan and the loan officer who was a good friend of 4ichael gave 4ichael the bank%s standard form guarantee and told him to get the guarantors to sign the documents and return them to the bank thereafter. $ason approaches his grandmother0 who is A years old and suffering from advanced #lDheimer%s disease and his nephew who is 2 years old to sign the guarantees and returned the documents to the bank. 4ichael collected the loan monies and took off on a holiday to -hailand where he fell in love with a local beauty and decided not to return to Singapore. -he bank has sent letters of demand to the two guarantors and 4ichael%s nephew seeks your advice on what to do.
29
