Force and Fear (L11) Flashcards
What is force and fear?
Force and fear = metus, or vis ac metus.
- Coercion or pressure is applied to secure consent.
- Sufficient to annul consent.
CONTRACT IS VOID traditionally.
- If fear prevents consent = void.
If consent if reluctantly given, but not annulled, could be a different ground of challenge e.g. undue influence = voidable.
What is force?
Hislop v Dickson Motors (Forres) Ltd.
- Futile or empty threats are not enough.
- The threat must be unlawful.
- If lawful, it will not be f&f.
- E.g. threat of court action for a debt that is due.
- Earl of Orkney v Vinfra (1606).
- Induced to sign a contract with a sword at their throat.
Threats can come from a third party.
- Trustee Savings Bank v Balloch 1983.
Or can be directed at a third party.
- Children/close family.
What is fear?
Hislop.
- “The pressure must be such as would overpower the mind of a person of ordinary firmness”.
- Subjective element to the test.
- E.g. someone’s age may play a role, or their physical health.
Hunter v Bradford Property Trust Ltd 1970.
- Fear cannot be “vain or foolish”.
What is facility and circumvention?
Abuse of one party’s “weakness” by the other.
3 requirements.
- Facility.
- Lesion or disadvantage.
- Circumvention.
What is facility (f&c)?
Examples: Age, may be incapacity. Physical weakness. Mental weakness. Other vulnerability e.g. bereavement.
McGilvary v Gilmarton 1986.
- Had stated that she was going to give her house to her son, when her husband died, her daughter persuaded her to visit a solicitor and sign a document signing ownership to her daughter.
What is legion or disadvantage (f&c)?
Usually financial.
Disadvantage to the weaker person.
Advantage to the stronger person.
What amounts to circumvention (f&c)?
Actual deceit is not required.
Anderson v Beacon Fellowship 1992.
- “Renounce your worldly possessions”. Anderson had depression, they told him the only way to recover from his depression was to renounce his possessions, he gave large sums to them.
- “The concept of fraud in this context is not necessarily confined to the use of deliberate deceit by the use of false pretences in order to trick a person into doing that which he would not otherwise do”.
What type of persuasion applies (f&c)?
Look at circumstances.
Would the person have done the same thing with no pressure?
Look at relationship.
Easier to show in relationship of trust.
Harder to show in arms’ length transaction.
- Mackay v Campbell 1967.
The more facile, the less circumvention required.
Leads to voidable contract is restitutio in integrum is possible.
What is undue influence?
Abuse of a relationship of influence or trust.
Established by Gray v Binny 1879.
- Man was persuaded by mother to transfer control of inheritance.
Fiduciary or quasi-fiduciary element.
What type of relationships apply for undue influence?
Relationship does not automatically create a presumption, must be proved (McBryde).
Honeyman’s Exrs v Sharp 1978.
- Woman’s husband died, she inherited his fine art collection. She ended up changing her will to give the collection to the other man.
Gaul v Deerey 2000.
- Taxi driver became close with old woman. He gave her frequent financial advice. She ended up bequething him in her will.
What is involved in undue influence?
Actual deceit not required.
Personal benefit gained through abuse of trust.
- “What is involved is some kind of abuse of the position of trust for the benefit of the person in whom the trust is confided”.
- Does not need to be “direct benefit” although that will usually be the case (Forbes v Knox & Ors 1957).
Voidable if restitutio in integrum is possible.
What is an abuse of good faith?
Cautionary obligation (guarantee by third party).
Smith v Bank of Scotland 1997.
- Loan contract (between debtor (husband) and lender (bank)).
- Contract of caution (between cautioner (wife) and creditor (bank)).
- Husband given wife false pretences about consequences of contract.
- Bank under a duty to act in “good faith”.
- “The broad principle in the field of contract law of fair dealing in good faith” (Lord Clyde).
- Should have warned of consequences.
- Should have given her advice to seek independent legal advice.
Application of Smith.
Applied restrictively by Scottish courts.
- Braithwaite v Bank of Scotland 1999.
- Royal Bank of Scotland v Wilson 2004.
- Bank only under obligation where there has been an “actionable wrong” by husband - misrepresentation or undue influence.
Cooper v Bank of Scotland 2014.
- BANK WAS NOT IN GOOD FAITH.
- Misrepresentation by husband.
- Took no steps to warn.
- Did not advise to seek legal advice.
