Business Law

2. Alila is 75 years old. She wishes to transfer the ownership of new house to her only daughter. Athena, she does not expect any payment from Athena, for the transfer of the house. Advise Alila to whether the transfer can be done under the law.

The issue is whether the transfer of house to her daughter can be done under the law.

Under section 26 Contract Act 1950, (‘’CA’’) provides that as general rule, an agreement without consideration is void.

Section 2 (D) of CA provides the definition of consideration as “When, at the desire of promisor, the promise or any other person has done or abstains from doing something such act or abstinence or promise is called a consideration for the promise.’’

Section 26 (a) of CA provide that an agreement without consideration is void. However, there is an exception to this general rule. Which is by natural love and affection. There are three requirements of the exception for this general rule. Firstly, It had to be in writing. Secondly, the agreement must be registered under law. Lastly, the parties stand in a near relation to other. In the case of Tan Soh Sim, Chan Kaw Keong & Ors v Tan Saw Keow & Ors, the court held that the meaning of the words ‘near relation’ various from one social group to another as it depends on customs and practices of such group.

Applying the principle of law above, it is clear that Alila may transfer its ownership of new house to Athena if she fullfill the three requirements of the exception of the general rule. Alila has to proof that the agreement is in writing, registered under relevant law which is the Sabah Land Ordinance. Lastly, as Alila and Athena relations are mother and daughter.

Conclusion, the transfer of the ownership of house between Alila and Athena can be done under law.