Vitiating factors represent some sort of defect in the formation of the contract. Examples of this are that the contract is based. Do both categories together amount to a law against unconscionable contracts? It is of great importance that parties to a contract enter into the agreement voluntarily rather than as a result of pressure which is called duress or manipulation which is called undue influence. The basis of a contract, a legally binding contract is founded upon the parties giving their free consent to be bound by the terms of the agreement.
In other words, the contract is made within the context of some pressure or obstruction. Equally, there are significant differences between them that will make it harder to regard them as simply aspects of a wider legal framework prohibiting unconscionable bargains.
A contract made in such a way will be voidable. There is no actual agreement just force, and so the person being threatened should not be held to the contract. Unlawful threats of physical violence however are clearly going to have this effect, but, in recent years, courts have extended the concept far beyond this.
Usually the fact pattern involves the victim being isolated from receiving advice except from the persuader. Falling within this rule are situations where, for example, a child takes advantage of an infirm parent, a doctor takes advantage of an ill patient, or a lawyer takes advantage of an unknowledgeable client. If there has been undue influence, the contract is voidable by the party who has been unfairly persuaded. Whether the relationship is one of domination and the persuasion is unfair is a factual question.
See Section A contract induced by physical duress—threat of bodily harm—is void; a contract induced by improper threats—another type of duress—is voidable. Voidable also are contracts induced by undue influence, where a weak will is overborne by a stronger one. Previous Section. Table of Contents.
Next Section. Understand what undue influence is and what the typical circumstances are when it arises to make a contract voidable. Duress When a person is forced to do something against his or her will, that person is said to have been the victim of duress A threat of improper action to induce a person to make a contract. At the conclusion of this podcast you should be able to 1 distinguish between duress an improper threat and undue influence unfair persuasion ; 2 identify which types of threats are improper and distinguish between cases of duress involving physical compulsion making a contract void and other cases where the threat makes a contract voidable; 3 identify relationships that might lead to a claim of undue influence; and 4 describe how and when these defenses can be used to enable a party to rescind a contract otherwise validly entered into or where the contract might be void as a result of duress resulting from physical compulsion.
Skip to main content. Search form Search. In Barton v Armstrong the plaintiff threatened to kill the defendant if he did not sell his interest in the company they were both major shareholders in. The trial judge ruled that duress could not be pleaded since it was not established that the agreement would not have been entered into without the threats being made.
The Privy Council, however, later ruled that a plea of duress should stand even if the death threat was not the only reason for entering into a contract. In Cummings v Ince , an elderly lady was told to sign over all her property or face not ever having a committal order to a mental asylum lifted. The contract was found to be void. In Skeate v Beale , the court decided that since the threat had been directed towards property, this did not constitute duress.
However, in The Siboen and the Sibotre , the court decided that serious threats that constituted burning a house or damaging expensive paintings should be considered as duress.
Therefore, duress also covered property in the most serious circumstances. In Atlas Express v Kafco , the court decided that because there was a threat made to a small business for them to breach the rules of a contract it had entered into, this would be considered economic duress.
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