UNIVERSITY OF MALAWI

SCHOOL OF LAW, ECONOMICS AND GOVERNMENT

DEPARTMENT OF PRIVATE LAW

END OF SECOND SEMESTER EXAMINATION

LLB 223: LAW OF CONTRACT II

DATE: TIME: 8:30am – 12:00pm

INSTRUCTIONS:

1. Ensure that there are Six (6) questions in your question paper.

2. Answer 2 questions from Section A and 2 questions from Section B

3. All questions carry 25 marks

4. All your answers must be supported by relevant legal authorities.

5. Begin your answer to each question on a separate answer sheet, clearly marking on
each sheet your examination or student identification number

6. Time allowed for this examination is 3 hours and 30 minutes only.

Question 2
a) Discuss the instances in which a court will refuse to rescind a contract.
(10 marks)
b) Critically analyse whether the legal position on mistake as to one party’s identity is in the
aligns with the interest of justice.
(15 marks)

Question 3
Critically examine the extent to which silence can amount to a misrepresentation.
(25 marks)

SECTION B

Question 4
Martin Luso (“Luso”) is an engineer who runs a business that manufactures hooded hair dryers,
hair straighteners and hair steamers. Chifundo Zeze (“Zeze”) owns a chain of high-end salons in
Lilongwe and engages Luso to procure two hooded dryers and one hair steamer from him. Under
their contract, delivery is agreed to be three months from the date of contracting with payment
being made immediately after delivery.

Luso begins constructing the machine but the production hits a snag when the parties fail to agree
on certain cosmetic specifications due to the fact that Zeze kept changing her mind. Knowing that
the machine could technically be used even if it didn’t satisfy Zeze’s wishes on appearance, Luso
delivers the machine at the end of ten weeks. Zeze refuses to accept delivery. Luso takes it back
but does not work on it any further. In fact, he informs Zeze that he has taken on other contracts
and he will work on those instead and leave her machine be.

Zeze has no choice but to take the machine though she considers his actions amount to repudiation.
She immediately commences proceedings on the basis of repudiation. Luso disputes repudiation
and counters with the fact that he tendered performance and, in any case, he should be paid for his
substantial performance of the contract. Zeze disagrees that his actions could amount to tender or
substantial performance. After both parties file their statements of case, Zeze also discovers that
one of the dryers does not reach the temperature required to properly dry hair and accordingly
amends the statement of claim to include this aspect.

You are a judge who has been assigned this matter. Please write a judgement on your stance on
each of the issues in this matter.
(25 marks)
Question 5
Chisomo owns a shop in Blantyre in which he mainly sells and repairs John Deere lawnmowers.
His is the only shop in Blantyre that deals in this type of lawnmower. Chisomo works with a
delivery company called Smart Deliveries which picks up lawnmowers from Chisomo’s shop and
drops them off at his customer’s premises and vice versa. He has been working with the company
for years and is used to working with the same delivery guy. However, a few weeks ago, Smart
Deliveries replaces Chisomo’s usual delivery with a new guy by the name of Mari. Over the course
of the next several months Chisomo and Mari build a rapport and Mari confides in Chisomo and
tells him of the fact he a Burundi national who fled turmoil in his country and was smuggled into
Malawi. As such, he is an illegal immigrant in Malawi and he states that Smart Deliveries was the
only work that he could find.

Though alarmed, Chisomo is also sympathetic and continues doing business with Smart
Deliveries. However, two weeks after his confession, Mari picks up a brand-new lawn mower from
Chisomo’s shop which is never delivered to the customer. Follow ups with Smart Deliveries prove
fruitless as they also state that they have also not heard from Mari in days. Chisomo threatens to
sue Smart Deliveries for breach of contract but Smart Deliveries indicates that he cannot enforce
it as he knowingly participated in a contract tainted with illegality. Smart Deliveries also states
that, in any case, this situation simply amounts to a blameless frustrating event.

On top of all of this, Chisomo has been considering opening another shop in Zomba, where he
lives, and selling his shop in Blantyre. The prospective purchaser is Greengrass PLC, a national
firm that owns a chain of shops and which specialises in John Deere lawnmowers. This firm wants
Chisomo to agree not to open another shop and the proposed contract has a clause stopping
Chisomo from selling ‘John Deere lawnmowers, or any other make other lawnmower, or any other
garden equipment, anywhere in Malawi’ for the next four years. Greengrass PLC gives Chisomo
two weeks to consider their offer. Chisomo has now approached you for legal advice as to whether
he has an action against Smart Deliveries and whether he should agree to the condition attached to
Greengrass PLC’s offer.
Write a legal opinion:
a) Advising him on his right of action against Smart Deliveries
 (15 marks)
b) Advising him on the legality of the condition attached to Greengrass PLC’s offer
(10 marks)
Question 6
Mtendere runs a dry- cleaning business and one of her cleaning machines has needed regular
repairs over the past two years. On the latest occasion on which it breaks down, she phones
Mayamiko, who has mended the machine on previous occasions. He agrees to come out on the
basis of an ‘all inclusive’ charge of MK45,000. When he has repaired the machine, he asks
Mtendere to sign a form stating that all work has been completed satisfactorily, that Mayamiko
will replace any parts that break down within three months, but that otherwise Mayamiko accepts
no liability for loss or damage caused by his work. Mtendere signs the form. The next time that
Mtendere uses the machine, it squirts chemicals from around a defective seal, which Mayamiko
should have replaced as part of the repair. The chemical causes burns on Mtendere’s neck and
chest, and ruins one of Mtendere’s own dresses, worth MK100,000 which she was holding, about
to put it into the machine. When she brings this up to Mayamiko he points to the form she signed
and states that he cannot be responsible for any of the damage.

Further, Mtendere is expanding her business and is renovating her business premises. She engages
a firm of architects, Dyson & Co, to draw up plans for the renovation of the building. The contract
price was to be MK5million, with a deposit of 7.5 per cent payable immediately. Her accountant
incorrectly calculated the deposit as MK750,000 instead of MK375,000 and paid the larger amount
to Dyson & Co. She also bought 20,000 used bricks from Layers Ltd, at MK100 per brick, and
paid a total of MK2million. Several hundred of the bricks were used immediately to repair the
original building structure and the rest were to be used for the expansion project. In April, Dyson
& Co, whose business was in difficulties, terminated its contract with Mtendere, having produced
only an outline sketch of the expansion. Worse still, the bricks turned out to have been stolen
(although Layers Ltd was ignorant of this) and were reclaimed by the true owner. The market price
of such bricks is now MK80 per brick.

Mtendere has approached you for advice as to whether she has any claim against Mayamiko and
whether she can reclaim any money from Dyson & Co and Layers Ltd.
Please write a legal opinion:
a) Advising her on her claim against Mayamiko.
(15 marks)
b) Advising her whether she can reclaim money from Dyson & Co and Layers Ltd.
(10 marks)