Jun Hew owns a cyber cafe, which is managed by his nephew, Chin Chai. Jun Hew had gone mountain trekking in Nepal and was not in contact with Chin Chai for a month.
business
Description
Problematic Questions
Assessment (by group)
Jun Hew owns a cyber cafe, which is managed by his nephew, Chin Chai.
Jun Hew had gone mountain trekking in Nepal and was not in contact with Chin
Chai for a month. As there were a number of robberies nearby, Chin Chai decided
to install a security system in the cafe using closed circuit cameras. He had
desperately tried to contact Jun Hew about his fears over the robberies but
could not get him.
Chin Chai contacted Safe and Sound Security Systems (SSSS), a local
security firm that specializes in using the latest security systems. Chin Chai
was so impressed with the security systems available, that he ordered the
latest security cameras worth RM20.000.
In the meantime, Chin Chai decided to update the computers in the cyber
cafe as they have become outdated and the customers had asked him to install
the latest computers or they will go to other cyber cafes which offer better
graphics. He contacted a number of local computer suppliers including
Cyberworks, for quotations on new computers. Cyberworks, had the best quotation
as they provided ongoing service for repairs and maintenance of computers sold.
Chin Chai placed an order for 80 new computers with them. Chin Chai signed the
contract to purchase the computers in his own name but actually intending to
buy the computers for Jun Hew. Jun Hew returned from Nepal last week.
Yesterday, the workers from SSSS came to install the security system. However,
Jun Hew refused to let them install the security cameras claiming that he had
not authorised Chin Chai to order such an expensive security system. Further,
he was surprised when Cyberwork's representative telephoned to confirm the
order for the new computers. Jun Hew refused to confirm the order. However, the
next day, his friend Alan informed him that the computers from Cyberworks were
worth buying as he had been given a good deal. When Jun Hew called Cyberworks
to ask them to deliver the computers, he was informed that the company had sold
the computers to another buyer.
Advise Jun Hew on his rights and liabilities under the law of agency as
to whether:
a)He is bound to the contract Chin Chai made with SSSS.
b)He can insist that Cyberworks deliver the computers under the contract
made on his behalf by Chin Chai
