The Doctrine of Unconscionability in Malaysia: Undue Influence

Topics: Contract, Contract law, Contractual term / Pages: 11 (2677 words) / Published: Apr 10th, 2014
THE DOCTRINE OF UNCONSCIONABILITY:
IS IT APPROPRIATE FOR IT TO BECOME THE UNDERLYING PRINCIPLE FOR A CLAIM OF VOIDABLE CONTRACTS ON THE GROUNDS OF UNDUE INFLUENCE?

Table of Contents
1.0 Introduction 3
2.0 Concept of undue influence 3
3.0 Doctrine of unconscionability 4
4.0 Correlation and distinction of the two doctrines 5
5.0 Unconscionability within the meaning of section 16(3) (a) of the 7
Contracts Act.
6.0 The link between the doctrine of unconscionability and the Consumer 7-8
Protection (Amendment) Act 2010
7.0 Conclusion 8
Bibliography 9-10

1.0 Introduction (Application In Malaysia)
A voidable contract is one that gives the aggrieved party the right to choose whether or not to proceed or terminate its performance. Thus, voidable contracts shall have the meaning allocated to it as per section 2(i) of the Act.
To analyze the similarities and differences between the two doctrine of undue influence and unconscionability, it is pertinent to evaluate the development and progression of law governing these doctrines in specific countries. Through a trend analysis, the law in countries such as Malaysia, Australia and United Kingdom have seen to be significantly developed. For an instance, in Australia, the classic decision in the case of Commercial Bank of Australia v Amadio1 is in line with the Common Law position regarding the doctrine of unconscionability. Similarly, in Saad Marwi v Chan Hwan Hua & Anor2 the court’s decision shows that the doctrine of unconscionability which was



Bibliography: 2. Fong, C. M. (2005). A Doctrine of Inequality of Bargaining Power and Unconscionability After Saad Marwi? Malayan Law Journal, 4, i-xii. 3 4. Willett, C. (2007). Fairness of Consumer Contracts—the Case of Unfair Terms. 6. Yee, T. (2008). The Etridge Influence on Undue Influence: Attempts at Fussion with Duress and Unconscionability. (Masters of Law), University of Caterbury. 2. Dato’ Seri Sinnandurai, V. (2011). Law of Contract (Vol. 4). Malaysia: Lexis Nexis. 3. Argawal, V. k. (2001). Law of Contract: Principles and Practice. Kuala Lumpur: International Law Book Services. 1. Commercial Bank of Australia v Amadio (1983) 151 CLR 447 2

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