Gavin Howe
Duress and undue influence are two legal doctrines that provide grounds for an individual to void or nullify a contract. While similar in nature, they are distinct in their application and treatment by the courts. Duress involves the use of threats or violent action to coerce an individual into a contract against their will, whereas undue influence involves exploiting a relationship or power dynamic to manipulate an individual into a contract. Both concepts are forms of manipulation that can result in unfair agreements and are thus significant considerations in contract law.
| Characteristics | Values |
|---|---|
| Duress | Threat of bodily harm or violence |
| Threat of economic harm | |
| Threat of criminal prosecution or civil suit without legal grounds | |
| Threat to defame or ruin reputation | |
| Physical force | |
| Improper threat | |
| Excessive pressure | |
| Undue Influence | Exploitation of a relationship |
| Isolation from friends and family | |
| Exploitation of a position of power | |
| Unfair persuasion |
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What You'll Learn
Duress defined
Duress is a legal concept in contract law that refers to a situation where a party is forced or coerced into entering a contract against their will. It involves some form of threat, violence, or other action that compels an individual to act against their own interests and intentions. The key element of duress is the presence of a serious threat that leaves the victim with no reasonable alternative but to agree to the contract. This threat can take various forms, including physical harm, economic harm, or legal action. For example, threatening to physically harm an individual, their family, or their property would constitute duress. Similarly, threatening economic harm, such as defamation, ruining one's reputation, or initiating criminal prosecution without legal grounds, can also be considered duress.
There are two main types of duress recognised by law: physical duress and economic duress. Physical duress involves causing or threatening to cause physical harm to an individual, their family, or their possessions. This type of duress renders the contract void as it involves physical compulsion, and the victim cannot be said to have truly consented to the contract. Economic duress, on the other hand, involves threatening economic harm or legal action without valid grounds. This can include threatening to sue or prosecute someone without a legitimate legal basis, as in the example of Roseanna threatening to sue Ryan, the restaurant owner, knowing that her claims were unfounded. In such cases, the contract is typically considered voidable, meaning it can be nullified or revoked by the court.
Economic duress often arises when one party has a stronger bargaining position and uses that power to coerce the other party into agreeing to unfair terms. It is important to note that the threat must be serious and leave the victim with no reasonable alternative for duress to be established. The standard for proving duress can be high, and it may be challenging to demonstrate that an individual's free will was completely overcome by the threat. However, if duress is proven, it provides a powerful remedy for individuals who have been forced into contracts against their will, allowing them to void or rescind the contract and protect their legal rights.
The concept of duress is distinct from undue influence, although they share similarities as manipulation tactics. Undue influence involves exploiting a relationship or power dynamic to manipulate another into a contract. It often involves taking advantage of a vulnerable person's trust or dependence and can include various forms of persuasion or manipulation, such as affection, isolation, or withholding attention or medical care. While both duress and undue influence involve coercion, the key difference lies in the nature of the coercion. Duress is primarily based on explicit threats, while undue influence is more subtle and centred around exploiting relationships or power dynamics.
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Undue influence defined
Undue influence is a form of manipulation that occurs when one party uses their power to coerce another into a contract. This power can be in the form of an attorney manipulating their client into giving them money or an ill person being taken advantage of by a doctor. It is a milder form of duress that does not involve physical harm or explicit threats but rather an abuse of power or trust that deprives a person of their free will.
Undue influence is typically based on a relationship that has been exploited for personal or financial gain. This exploitation can take many forms, such as through affection, isolation, or extreme persuasion. The influencer may also withhold attention, medical care, or advice to pressure their victim into acting against their will. Due to the secretive nature of undue influence, it can be challenging to detect and prove in court.
To prove undue influence, the claimant must demonstrate that their free will to enter a contract was overcome, which can be difficult to establish. In certain categories of relationships, such as those involving a pre-determined presumption of influence, the claimant only needs to prove that the relationship was exploited. However, in other cases, the evidential burden is higher, and the claimant must prove that they had no choice but to enter the contract.
Undue influence is an equitable doctrine, meaning it is based on fairness and justice rather than strict legal rules. It provides a remedy for individuals who have been coerced into contracts through improper pressure, allowing them to void or rescind the contract. The court will assess the specific situation and determine whether the contract should be nullified entirely or revoked under specific terms.
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Proving undue influence
Undue influence is an equitable doctrine that involves one person taking advantage of a position of power over another person. This inequity in power between the parties can vitiate one party's consent as they are unable to freely exercise their independent will. In exerting undue influence, the influencing individual is typically able to take advantage of the weaker party.
To prove undue influence in court, the claimant must show that there is a special relationship that gives rise to a presumption of undue influence. These relationships include parent and child, medical adviser and patient, solicitor and client, and religious advisor and disciple. The presumption does not apply between husband and wife. If one party in a cohabiting relationship is a solicitor, the presumption is likely to arise even if they do not consider themselves to be in a solicitor/client relationship.
In other cases, the claimant must establish that there was a sufficient degree of trust and confidence in the wrongdoer in relation to financial matters. The courts will then assess whether the conduct amounts to undue influence. The claimant must prove that their free will to enter a particular contract was overcome, which is not easy to establish.
There are two forms of undue influence: actual undue influence and presumed undue influence. Actual undue influence requires proof that the transaction was entered into as a result of actual influence exerted, such as unlawful threats. Presumed undue influence arises from the existence of a relationship between the two parties, where one has acquired a measure of influence or ascendancy over the other.
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Types of duress
Duress in contract law refers to a situation where a party uses threats or coercion to force another party to enter into a contract against their will or where the contract terms are unfavourable to them. There are several types of duress, including physical, economic, and duress of goods.
Physical duress involves causing or threatening to cause physical harm to an individual, their family, or their property. For instance, in Barton v Armstrong (1976), the plaintiff threatened to kill the defendant if he did not sell his interest in their shared company. The court ruled that the defendant could plead duress as the threat of violence constituted a reason for agreeing to the contract.
Economic duress, a newer concept in English common law, involves threatening another party with economic harm. An example is threatening legal action without legal grounds unless a demand is met. In Atlas Express v Kafco (1989), the court found economic duress as a small business was threatened with a breach of contract.
Duress of goods occurs when a party threatens to destroy, damage, seize, or detain another party's goods, effectively holding them to ransom while demanding a change to the contract terms. While English law treats these threats less seriously than threats to a person, they can still constitute duress if they significantly caused the entry into the contract and there was no effective alternative remedy.
In addition to these types, duress can also be categorised as "duress of the person", which involves actual or threatened violence or imprisonment directed at the contracting party, their spouse, or other near relations. Threats to employees may also constitute duress of the person.
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Duress and undue influence remedies
Duress and undue influence are two legal doctrines that provide a means for an individual to avoid an already concluded contract. Duress involves some kind of threat, violent action, or other coercive behaviour that forces an individual to act against their will. On the other hand, undue influence involves exploiting a relationship to gain an advantage, often through manipulation or unreasonable pressure. While similar, these two doctrines are treated differently by the courts.
Duress Remedies
In cases of duress, the contract is typically considered voidable, allowing the aggrieved party to set aside or revoke the contract. For example, if one party threatens physical harm or economic harm to the other party or their family, the contract can be voided as it was not signed voluntarily. Economic duress, such as threatening to sue without legal grounds, can also make a contract voidable.
Undue Influence Remedies
The primary remedy for undue influence is that the court will refuse to enforce the agreement, setting aside the contract. This is because undue influence involves improper pressure or exploitation of a relationship, which is considered unacceptable. However, proving undue influence can be challenging, as it requires demonstrating that the claimant's free will to enter the contract was overcome. In some jurisdictions, there may be additional remedies, such as "unconscionable bargains," but these are rarely used.
Similarities and Differences
Both duress and undue influence provide grounds for contesting or voiding a contract, transfer of property, or gift. They are often difficult to distinguish, as they both involve manipulation tactics and can result in similar outcomes. However, duress is based on explicit threats, while undue influence is based on exploiting a relationship. Additionally, duress is a common law doctrine, while undue influence is an equitable doctrine.
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Frequently asked questions
Duress is defined as some kind of threat, violent or other action that is used to coerce someone into doing something against their will. In contract law, this refers to when a party uses duress against another party to enter into a contract that they either do not want to or where the terms are unfavourable to them. Duress can be physical, referring to causing or threatening to cause physical harm to an individual, their family, or their goods. It can also be economic, referring to threatening another with economic harm. A contract induced by duress is voidable and can be revoked by the court.
Undue influence involves using one's power to manipulate another into a contract. This can include using one's power as an attorney to get money or free work out of their client or manipulating a vulnerable person. Undue influence is an equitable doctrine, unlike duress, which is based on common law. It is a milder form of duress and is usually based on a relationship that has been exploited for unfair gain. Undue influence can be difficult to detect as it often involves isolating the victim. The primary remedy in a finding of undue influence is that the court will refuse to enforce the agreement.
Duress is based on a threat, whereas undue influence is based on exploiting a relationship. Duress is a common-law response to pressure in the contractual process, while undue influence is an equity court response. Duress is easier to prove than undue influence, which requires evidence of the exploitation of a relationship.
