The Inland Revenue Board (IRB)

Prior to March 1996, known as the Department of Inland Revenue Malaysia which is under the Ministry of Finance currently. Besides that, it became a Statutory Board on the 1st of March, 1996. Generally speaking the Inland Revenue Board (IRB) is responsible for formulation of new tax policies for both the private and public sectors, tax collection, and compliance enforcement. Inland Revenue Board Malaysia (IRBM) was established in accordance with the Inland Revenue Board of Malaysia Act 1995 to give it more autonomy especially in financial and personnel management as well as to improve the quality and effectiveness of tax administration. The agency is responsible for the overall administration of direct taxes under the following Acts:

a. Income Tax Act 1967

b. Petroleum (Income Tax) Act 1967

c. Real Property Gains Tax Act 1967

d. Promotion of Investments Act 1986

e. Stamp Act 1949

f. Labuan Offshore Business Activity Tax Act 1990

Is there any difference between contingency and indemnity insurance policy?

From above the topic mentioned, all insurance policies are policies of indemnification, whereby the insurer agrees to compensate the insured for a loss covered by the policy. A contingency policy is a specialty policy that is used in the entertainment business that covers a promoter, production company. For instance, should a show or event be canceled by certain perils. Basically is a fancy form of business interruption coverage that includes perils that usually aren't covered by normal business interruption coverage. A Contingency Endorsement is also used on Marine insurance policies to cover a seller in the event the purchaser refuses a shipment that is received at the buyer's destination and refuses to place a claim on the buyer's insurance.

Uberrimae Fidei

The term of uberrimae fidei describes that a class of contracts whereby one party has a duty to disclose material facts relevant to the subject matter of the contract to other party. This is term applied in insurance contracts such that the insured legal person must disclose any relevant particular that may affect the insurer's decision to grant the insured a policy of insurance. In the event that a relevant disclosure does not take place, the contract is voidable at the option of the insurer. The duty may also apply to contracts for the shares, land and partnership. The terms is also used in the context of fiduciary duties. By the way, the uberrimae fidei on Latin terms is defined as of the utmost good faith.

Uberrimae Fidei of Chitty on Contracts

"Mere non-disclosure of fact, material or not, does not ordinarily amount to misrepresentation, and the general rule is that in order to be actionable a representation must take an active form". But in certain cases a stricter rule is enforced.

"The most important of these are the contracts uberrimae fidei, in which knowledge og the material facts generally lies with one party alone, that party is under a duty to make a full disclosure of these facts, and failure to do so makes the contract voidable...The duty varies in its extent from one type of contract to another.

Contracts of insurance of every kind form the main group of contracts uberrimae fidei. Other examples generally included, though these are probably not all uberrimae fidei in the strict sense, are contracts to subcribe for shares in a company, family settlements, contract, for the sale of the land, contracts of suretyship, and partnerships. Contracts of service are not uberrimae fidei, are not contracts of sale of goods.

Doctrine of Utmost good Faith

According to the notes of business law, the Doctrine of Utmost Good Faith under the insurance law refers to each party to a proposed contracts is under a duty to disclose to the other all information which would influence his decision to enter into the contract, whether such information is requested or not.

Insurance is a contract governed by the doctrine of utmost good faith

Most contracts are governed by the maxim 'caveat emptor' or 'let the buyer beware'. However, insurance is governed by the doctrine of utmost good faith, both at common law and by reason of section. 17 of the Marine Insurance Ordinance which applies both to marine and non-marine insurance policies.

One of the reasons for this is the natural imbalance between the insurer and the insured in terms of knowledge. For example, before the pre-contractual process of disclosure is commenced, the proposer for insurance is in position to know all about his state of health, family history and his habit such as smoking. If that person is not obliged to make full disclosure, insurance could not work from either insured's point of view. The insurer initially would only consider offering a policy based on an average person's life expectation, the premium for which would tend to be too high for the healthy person to contemplate.

Caveat emptor

According from wikipedia, caveat emptor refers to the property law doctrine that controls the sale of real property after the date closing.Furthermore, under the doctrine of caveat emptor, the buyer could not recover from the seller for defects on the property that rendered the property unfit for ordinary perposes. The only exception was id the seller actively concealed latent defects or otherwise made material misrepresentations amounting to fraud. Before statury law, the buyer had no warranty of the quality of goods. In many jurisdictions now, the law requires that goods must be of 'merchantable quality'. However, this applied warranty can be difficult to enforce and may not apply to all products. Hence, buyers are still advised to be cautious.

Case study - Insurance Law

Car stolen from driveway - whether firm was right to reject complaint on the grounds of customer's 'carelessness'

Scenario:

Micky's car was stolen from the driveway of her home while she was inside the house. She neither saw nor heard the theft. When she put in a claim to the firm, it asked her to send it her car keys. However, she was only able to produce the spare ignition key. Taking this as evidence that the key had been in the car when it was stolen. She had lost the key a month earlier and had been using the spare. She was adamant that she had not been 'careless', as the firm had suggested. After the firm rejected her complaint, she came to us.

Opinion:

I agreed with Micky that she had not been 'reckless'. Someone is reckless if they recognize a risk, but deliberately 'court' it. Micky had not done this, so the firm was wrong to say that she had breached the 'reasonable care' condition. However, the firm had specifically highlighted this clause when it sold Micky the policy. And as i not satisfied with Micky's explanation that she had lost the original car key, i concluded on balance that it was likely that she had left the key in the car. I satisfied that circumstances of this theft did fall within the scope of that exclusion. She could be said to have 'left' the keys in the car because she had gone into the house, and was too far from the car to be able to prevent it being stolen. Furthermore, the fact that the car was parked so close to the road meant it was relatively vulnerable to an opportunistic thief. Therefore, in my opinion, i rejected the complaint.

Case study - Sale of Goods Law

Case Question:

The case under consideration today concerns Micky, who is a self-employed painter and decoraot and a painting firm known as "Paintplus". Micky had bought a cottage in a coastal area and had bought help from an assistant at the Paintplus store in recommending a heavy duty masonry paint that would withstand the harsh climate changes evident on a coastal area, and a brand of wipe-clean paint that would be suitable for interior use in a wet area (the bathroom). The assistant at Paintplus recommended their own brand of masonry paint (Everlast) because it was the cheapest available. Micky checked the description on the tin and agrees that the paint appeared to be suited to her requirements. When asked about the bathroom paint the sales assistant told Micky that internal paints were not his speciality, but he had heard other customers comment favourably about a product known as "Cleaneasy". The store had some tins of Cleaneasy going at half price because the written description about the product had become detached from the tins some time previously so the tins were being sold without this documentation. Micky that might have been written on the leaflet and the sales assistant said, [quote] "its standard paint so just slap it on". Over time Micky had problems with both paint types she had purchased from Paintplus. The masonry paint was easy to apply and withstood the harsh climate of winter, but over the summer months the temperatures were "unprecedented" and the paint stated peel from the walls. The render under the paint was damaged through this and Micky had to employ a building professional to knock of the remaining render and paint, and then renderer and repaint the entire outside of the cottage. Micky did not have much luck with the Cleaneasy paint either. While she was applying the apint some of it dropped on her skin and she suffered an allergic reaction to the paint. She needed medical treatment and was off work for three weeks because of this reaction. She also lost a major decorating contract because of her illness. Later investigations about the description that should have been on the tin when she bought it declared that if [quote] "any person suffering from skin complaints or sensitivities should refrain from using this product".

Opinion:

The first question considered is whether or not Micky could claim a breach of contract against Paintplus, and if so on what grounds. Briefly a contract can be said to occur when an offer is made to one party by another, and that offer is accepted. Having goods for sale in a shop is not considered an offer as such, but rather an invitation to treat although a bilateral contract can be said to occur in that the buyer agrees to pay a certain price for goods, which the seller promises to deliver. The essential parts of a contract include the offer and acceptance, the consideration elements of the contract (sellers gets the money, buyer gets the paint), the acceptance that the contract concerned a business rather than social or domestic matter, capacity for both parties had to be able to enter a contractual agreement, an the contract has to be based on a legal transaction legality.

Relevant cases: Display of Goods in shops

Fisher v. Bell

Fact: The defendant displayed flick knives in his shop windows. He was then convicted of a criminal offence of offering such knives for sale.

Held: Display of any goods with a price tag on it in s shop window was not an offer but rather it was an invitation to treat.

Case of Company Law

Salomon v A Salomon and Co Ltd [1897] AC 22: Corporate separate personality

Salomon conducted his business as a sole trader. he sold it to a company incorporated for the purpose called A Salomon and Co Ltd. The only members were Mr Salomon, his wife, and their five children. Each member took one pound share each. The company bought the business for 40, 000 pound. Mr Salomon subscribed for 20, 000 pound further shares. However, 10, 000 pound was not paid by the company, which instead issued Salomon with series of debentures and gave him a floating charge on its assets. When the company failed the company's liquidator contended that the floating charge should not be honored, and Salomon should be made responsible for the company's debts.

Lord Halsbury LC stated (at 30-31):

"...it seems to me impossible to dispute that once the company is legally incorporated it must be treated like any other independent person with its rights and liabilities appropriate to itself, and that the motives of those who look part in the promotion of the company are absolutely irrelevant in discussing what those rights and liabilities are."

From this case, comes the fundamental concept that a company has a legal personality or identity separate from its members. A company is thus a legal 'person'.