Flashcards
Contract Law: Duress
Cards in this deck (6)
- 1What is DURESS?- Illegitimate physical threats:
Illegitimate threats to goods/economic threats:
The Atlantic Baron [1979]
Delays in bringing action for duress may indicate affirmation of contract - party under duress must protest immediately and indicate reluctance to enter into contract. - 2DuressDuress in contract law relates to where a person enters an agreement as a result of threats. Where a party enters a contract because of duress they may have the contract set aside. Originally, the common law only recognised threats of unlawful physical violence, however, in more recent times the courts have recognised economic duress as giving rise to a valid claim. Where the threat is to goods, the courts have been less willing to intervene, although analogous claims in restitution suggest that this position of the law may change. The basis of the duress as a vitiating factor in contract law is that there is an absence of free consent. Duress operates at common law. Pressure not amounting to duress may give rise to an action for undue influence in equity. The effect of a finding of duress and undue influence is that the contract is voidable. The innocent party may rescind the contract and claim damages. The normal bars to rescission operate (see misrep lecture).
- 3Duress to the personWhere a person enters a contract as a result of threats of physical violence, the contract may be set aside providing the threat was a cause of entering the contract. There is no need to establish that they would not have entered the contract but for the threat:
Barton v Armstrong [1976]
For duress, there must be an illegitimate form of pressure or threat to the person constituting a significant cause for them to enter into the contract. - 4Duress to goodsDuress to goods is not recognised as giving rise to grounds for having the contract set aside:
Skeate v Beale [1840]
However, this decision has received widespread criticism and is out of line with restitutionary claims:
Maskell v Horner [1915]:
Maskell v Horner [1915]; The Evia Luck (No 2) [1992]
Threats to seize another's property or to damage it will justify a claim in duress and result in the ensuing contract being set aside.
It is thought that the position in relation to duress to goods is unlikely to survive if it is tested in the higher courts, particularly given the more liberal position that has taken hold in response to claims for economic duress. - 5Economic duressThe doctrine of economic duress was first canvassed by Kerr J in Sibeon and Sibotre [1976]
To amount to economic duress there has to be a coercion of the will so as to vitiate consent. Commercial pressure is insufficient.
Pao On v Lau Yiu Long [1980]
For there to be economic duress, there must be coercion of the will that vitiates consent; and the pressure/threat must be illegitimate.
The Privy Council identified 4 factors to consider in assessing whether economic duress was present:
1. Did the person claiming to be coerced protest?
2. Did that person have any other available course of action?
3. Were they independently advised?
4. After entering into the contract, did they take steps to avoid it?
The requirement of vitiation of consent was replaced in The Universe Sentinel [1983] with the absence of choice. - 6What is wrong with duress?Stilk v Myrick (1809); Atlas Express Ltd v Kafco [1989]
Changes to a contract achieved by means of unfair pressure or extortion could be resisted on the grounds of absence of consideration.
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- Law (Contract Law) Flashcards on Contract Law: Duress, created by thierry fasnacht on 19/01/2018.
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- Created by a deleted user · May 21, 2013
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