MyCERT 3rd Quarter 2011 Summary Report - CyberSAFE Malaysia

14deciding if software is considered “goods”or a “service”. According to [6] MalaysiaConsumer Protection Act 1999, the definitionof “product” means any goods and, subjectto subsection (2), includes a product whichis comprised in another product, whetherby virtue of being a component part, rawmaterial or otherwise. Under Section 3 of the[7] Malaysia Sale of Goods Act 1957 “goods”means every kind of movable property otherthan actionable claims and money; andincludes stock and shares, growing crops,grass and things attached to or forming partof the land which are agreed to be severedbefore sale or under the contract of sale.Whereas under the [6] Malaysia ConsumerProtection Act 1999, “products” meansproducts which are primarily purchased,used or consumed for personal, domestic orhousehold purposes and includes productsattached to or incorporated in, any real orpersonal property, animals, including fish,vessels and vehicles, utilities and trees, plantsand crop whether on, under or attached toland or not, but does not include choosesin action, including negotiable instruments,shares, debentures and money.In Section 6 under [8] Malaysia Civil LawAct 1956 “fault” means negligence, breachof statutory duty or other act or omissionwhich gives rise to a liability in tort or would,apart from this Act, give rise to the defenceof contributory negligence. The liability of aperson under this Part to a person who hassuffered damage caused wholly or partly bya defect in a product. Moreover, [7] Section62 of the Sale of Goods Act 1957: Exclusionof implied terms and condition as to whereany right, duty or liability would arise undera contract of sale by implication of law, it maybe negatived or varied by express agreementor by the course of dealing between theparties, or by usage, if the usage is such asto bind both parties to the contract, it givestwo conflicting views on the part of theliability of the software programmer.Software can be defined as goods orservices, whichever conforms to the userand the manufacturer. Software productliability can be defined as any liability,negligence, malfunction, warranty issues andsubsequence negative effect that arise fromthe usage of the software, which can affecte-Security | Cyber Security Malaysia | Vol: 28-(Q3/2011)© CyberSecurity Malaysia 2011 - All Rights Reservedthe users’ environment such as incidents,losses, fraud and other negative impacts,and can be penalised under the respectivecountry laws. The responsible parties are theowner of the software, the manufacturer, theprogrammer, the salesman and anyone whowere directly involved in selling or providingthe software to the user.Manufacturer responsibilityTo protect their products, softwaremanufacturers use disclaimers andagreements between users and themselves.Users are forced to sign or click a buttonagreeing to the terms stated beforeproceeding to install and use the software.Many times, users are too lazy to read thefine print and continue the transaction byclicking the ‘Agree’ button without fullyunderstanding the legal terms and conditionsstated by the manufacturers. According to[3] Levy et al, in US, there are several casestudies where manufacturers are facing legalaction on faulty software related incidents.A construction company alleged that a bugin a spread sheet programme caused thecompany to underbid a $3 million contract.The company sued the manufacturer ofthe programme for $245,000, claimingit had lost that amount as a result of theincorrect bid. To date, in Malaysia, wedo not have similar cases being broughtinto our courts, even though we legalgrounds with regards to faulty software.There are provisions under ConsumerProtection Act, section 71 that states clearlyabout the responsibilities of manufacturersin Malaysia, where any damage causedwholly or partly by a defect in a product,the producer of the product whose using hisname on the product or using a trade markor other distinguishing mark in relation tothe product, has held himself out to be theproducer of the product persons and in thecourse of his business, imported the productinto Malaysia in order to supply it to anotherperson shall be liable for the damage.Users can also apply tort law and torttheory in both countries when dealing withmanufacturers of defect software. Courtjudgments normally requires the losingparty to compensate the victim financially.In principle, compensation in the form ofdamages and expenses will legally shiftlegally to the defendant. Since the software