Duress Flashcards
What is the general idea behind duress and what is its consequence?
As full and proper consent of both parties needed, courts will carefully guard against any illegitimate pressure to enter the contract or agree to certain terms. Common law remedy.
Consequences of Duress Contract entered under duress is voidable as opposed to void. As a voidable contract, victim must avoid the contract quickly or he’ll be taken to have affirmed it.
Forms of Duress - Threats, Violence etc.
Barton v Armstrong [1976]
B MD of a co in which A was chairman. Held controlling interest in share capital of co bw them.
Relations were poor and in course of negotiations bw them for B to buy out A’s share in the co, A made threats against B and his family (apparently A hired a hit-man to kill B).
As a result, B signed deed agreeing to make certain payments to A. Held made under duress.
Forms of Duress - Threats, Violence etc.
Lessee of Blackwood v Gregg [1831]
Old man signed deed in favour of relatives who abducted him. Held made on basis of duress.
Forms of Duress - Threats, Violence etc.
Griffith v Griffith [1944]
Lesser forms of coercion may be duress, such as the threat of disgrace or legal proceedings:
X sought to have marriage annulled. Met W when 19 and 16. Had sex and 3 mths later her family told him she was pregnant and he’d have to marry her. Threatened with disgrace and prison.
Held his consent had been vitiated by duress and found the marriage invalid.
Forms of Duress - Threats, Violence etc.
Kaufman v Gerson [1904]:
G agreed to pay off debt incurred by her H through his fraudulent
behaviour in return for promise her H wouldn’t be prosecuted. Unenforceable on grounds of duress.
Forms of Duress - Economic Duress
D&C Builders v Rees [1966] Recognised in
R owed D around £480. Knowing that D had srs financial issues, R offered to pay £300 in full satisfaction of the debt. D accepted. Court held contract could be avoided on basis of duress.
Forms of Duress - Economic Duress
North Ocean Shipping v Hyundai Construction [1979]
Demand of an extra 10% on agreed price held to be a form of economic duress where the
shipbuilder knew the other party needed the construction of ship to fulfil a lucrative contract.
Forms of Duress - Economic Duress
DSDN Subsea [2000])
To qualify as economic duress, pressure must be (1) illegitimate and (2) amount to something more
than the rough and tumble of normal bargaining
Forms of Duress - Economic Duress
R v AG for England and Wales [2003]
For pressure to be illegitimate, held you must consider:
The nature of the pressure
The nature of the demand accompanying the pressure
Forms of Duress - Economic Duress
The Universe Sentinel [1982]
A union threatened to blacklist P’s vessel unless it agreed to sign a collective agreement with a particular trade union federation and paid out a lump sum to workings.
Held the threat of blacklisting the vessel amounted to illegitimate pressure.
Forms of Duress - Economic Duress
CTN Cash & Carry v Gallagher Ltd [1990]
A party’s good faith in making the demand will be critical to determine whether it was legitimate:
G refused to continue extending credit facilities to C unless they agreed to settle an outstanding sum which the G’s genuinely (but mistakenly) believed was owing to them.
C disputed the payment and then claimed it was made under duress and G’s demand was illegitimate.
Held while the threat was coercive, it wasn’t unlawful as it was issued in good faith. No duress.
Forms of Duress - Economic Duress
Atlas Express v Kafco [1989]
K contracted w A to deliver cartons on behalf of K. Due to a miscalculation, the contract as agreed proved uneconomic. A negotiated a new higher rate for delivery w K.
K agreed bc it was v dependent on delivery of the cargo + unlikely to find another at short notice
Held the agreement was vitiated on the basis of duress.
Forms of Duress - Economic Duress
Wamsley v Christchurch CC [1990]
W engaged to design and print a programme for an air show event organised by C.
The programme produced didn’t meet the standards of C and was rejected
C agreed a new programme at agreed standard. W made new one and agreed to pay for extra printing costs. D later argued the new agreement was obtained by duress (threat of breach of c)
Rejected claim: W had the benefit of independent advice before accepting new agreement.
Also there was some delay involved and W didn’t attempt to reject until after air show!
Causation
Pao On v Lau Yiu Long [1980]
The victim must show that the pressure in question was a significant factor in their decision to enter the contract under those particular terms.
Scarman L set out factors as indicators as see if the will of the V was unduly interfered with:
Did the person protest?
Was there an alternative course of action open to him, such as a legal remedy?
Was he independently advised?
After entering the contract did he take steps to avoid it?
