Economic duress Flashcards
What is economic duress?
When someone enters a contract due to financial threats
Pressure which goes beyond usual business dealings
What is the core case and held for economic duress?
Atlas Express v Kafco- ED as no consideration for additional term
What is the 3 part test for economic duress?
Pressure forced you into the contract or leave a lack of practical choice for the victim
Pressure must be illegitimate
The illegitimate pressure is the significant cause of making the contract
What does ‘force into contract/ lack of practical choice’ mean?
There was no choice but to agree
What is the case for force into the contract?
Universe Tankships v ITW federation
What does the case of Pao On v Lau Yiu Long say?
Establishes test for illegitimate pressure
What is the test for illegitimate pressure? (4 elements)
Did the person claiming economic duress protest? (illegitimate)
Was there another reasonable course of action available? (legitimateWas he independently advised before taking action? (legitimate)
After entering contract, did they take steps to avoid thing in question? (illegitimate)
What does the case of CTN cash v Gallagher say about ED?
If the action threatened is lawful, it may not be ED
Claim failed
What does it mean if ‘illegitimate pressure is a significant cause of making contract’?
C wouldn’t have entered int the contract if it wasn’t for the pressure and depends on circumstances of the case
What is the case for significant cause?
Progress Bulk Carriers v Tube city- only agreed as no alternative, not ED
What does the case of Atlantic Baron say?
ED may be lost due to lapse of time
What are the remedies for economic duress?
Restitution of money or property
What is restitution?
Can order the money gained through ED can be returned to innocent party
