Undue Influence Flashcards
What is undue influence?
Undue influence was introduced to deal with cases where a contract was entered into as a result of pressure, but this pressure did not amount to duress
When can undue influence arise
Where there is a relationship between the parties which has been exploited by one party to gain an unfair advantage
What are the three different classes of undue influence set out in Bank of Credit & Commerce International v Aboody
Class 1 - actual undue influence
Class 2.a - presumed undue influence
Class 2.b - presumed undue influence
What is class 1 - actual undue influence
Requires proof that the contract was entered into as a result of the undue influence, e.g. threatening to end a relationship
What is class 2.a presumed undue influence?
No need to prove that improper influence was actually exerted
Must however be shown that there was a relationship in law which gives rise to a presumption of undue influence e.g. parent / child; doctor / patient; solicitor /client
What is class 2.b presumed undue influence
If a relationship does not exist under class 2a but in which it can be shown that someone placed their trust and confidence in another - a presumption of undue influence can still be found
Can you rebut presumed undue influence
A person accused of exerting undue influence can rebut the presumption by showing that the other party entered into the transaction of their own free will and were aware of risks involved
What is the case for parent / child
Lancashire loans v black
What is the case for solicitor / client
Wright v Carter
What is the case for doctor / patient
Mitchell v Homfrey
What is the case for trustee / beneficiary
Penningfield v Baxter
What isn’t included in 2a
Husband / wife
Employer / employee
What is the case for husband / wife
Midland bank v shepherd
What is the case for employer / employee
Matthew v bobbins
