Complete Notes on Undue Influence and Duress for Ulaw PgDL

Duress and Undue Influence


March 19, 2023


1 Duress
• As parties are free to contract on the terms that they wish, a party cannot
generally complain about ordinary commercial pressure or mere inequality
of bargaining power.
• It is only where there has been duress or undue influence that a contract
will be voidable, thus giving the innocent party the option to rescind it.

• Duress may take the form of violence or illegitimate threats or pressure
which coerce a party into entering a contract or varying a contract.
• Illegitimate pressure includes unlawful threats, such as a threat to commit
a crime or a tort or a threat to break a contract.

• The burden of proving duress is on the party who alleges it.
• Duress figures in with issues surrounding consideration.
• Following Roffey, obtaining a practical benefit can be good consideration
for a promise.

• However, if that promise is obtained through duress, then the practical
benefit is nullified such that there is no longer good consideration for that
promise.
• So, with a question regarding duress, always consider the issue of consid-
eration first as this will then lead to a discussion of duress.


2 Threats of Physical Violence & Economic Duress
• Threats of physical violence can constitute duress.
• In Barton v Armstrong [1975] AC 104, the court found that the claimant
was not bound by the contract as the defendant had threatened to kill the
claimant.



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, • Notice that, in Barton, the claimant thought that the contract itself was
beneficial to them.
• However, despite the contract being beneficial to the claimant, the court
still held that the contract was not binding on them.
• Indeed, Lord Cross of Chelsea made it clear that duress need not be the
only reason why the innocent party entered the contract.
• ‘... if Armstrong’s threats were ‘a’ reason for Barton [entering the contract]
he is entitled to relief even though he might well have entered into the
contract if Armstrong had uttered no threats to induce him to do so...
It was for Armstrong to establish, if he could, that the threats he was
making... in fact contributed nothing to Barton’s decision to sign.’
• Economic duress is the more common form of duress.
• Now, to amount to economic duress, the threat must be an improper or
illegitimate threat (such as a threat to breach a contract or commit a tort).
• It can be hard to distinguish between ordinary negotiation tactics and
economic duress.
• In Atlas Express v Kafco [1989] 1 All ER 641, the court found that eco-
nomic duress had occurred because the claimants had threatened to break
the contract if the defendant did not pay them £400 per load and defen-
dant no bargaining power.
• Notice also that in Atlas Express the court found that the claimants had
given no consideration to the defendant’s promise to pay them £400 per
load as they were merely performing a contractual obligation.
• Moreover, the claimants could not argue that, following Roffey Bros, they
had provided consideration for the defendant’s promise because the defen-
dant had obtained a practical benefit as the promise itself was obtained
through duress.


3 More on Duress
• The early cases on economic duress emphasised that there must be coer-
cion of the will so as to vitiate consent (Pao On v Lau Yiu Long [1980]
AC 614 ).
• However, to view duress as a matter of vitiated consent is not strictly
correct; for the problem with the contract is not the lack of consent but
rather the fact that the consent was obtained by improper pressure.
• Courts are no longer emphasising consent being vitiated as the key aspect
of duress; rather, more attention may have to be paid to the nature of the
pressure to determine whether this pressure is illegitimate.

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