Explain the law of duress as a vitiating factor in respect of a contract.

Contracts signed under duress are said to be voidable and the contract is able to be completely set aside. Duress only relates to duress to the person, requiring actual or threat of violence, and making them feel they must enter an agreement.

Grade: A-C | £0.00.

 

The plea of duress has been widened in recent years but originally the plea of duress was understood to consist of a real threat of intimidation if it were to have the effect of vitiating consent. Consent is treated as one of the prerequisites to the formation of a contract and the discovery that such consent of one or more of the parties was undermined by duress is sufficient to enable the contract to be avoided.

 

In recent years the courts have been willing to accept a claim for economic duress but this answer is concerned with duress by threats of violence.

 

We are concerned here with the plea of duress as applied to contract law and not to the defence of duress by threats that exists in criminal law.

 

The presence of duress is therefore to destroy the legal effect of the contract. The reason being that the consent can no longer be considered satisfactory in the sense that it was not freely given – the intimidation is seen as perverting or corrupting consent as it can no longer be considered reliable. Consent is one of the elements necessary for the formation of a contract and if it is vitiated in this way, the consequences are dramatic and fatal so far as the contract is concerned.

 

The principle that duress needed to consist of a real threat of intimidation was illustrated in the case of Cumming v Ince (1847) which involved an inmate in a private mental asylum. The inmate was coerced into signing away the ownership of all her property having been threatened that her committal order would remain in place and not be lifted. Clearly the threat to declare someone mentally unstable and face a future in a mental asylum with no chance of being allowed out, is extreme and sufficient to allow the agreement to be set aside.

 

What amounts to threats and intimidation sufficient to corrupt consent needs consideration as not all threats might be thought to amount to duress of a kind so as to vitiate consent.

 

In Barton v Armstrong (1973) the Privy Council took the view that threats of physical violence would have the effect of avoiding a contract. In the case in question two shareholders had fallen out and Mr Barton had signed a contract to buy Armstrong out. The terms were not in any way favourable to Mr Barton. Barton had signed after he had been threatened by Armstrong that he (Barton) would be killed if he did not enter into the transaction. It seems that there was a suggestion that Barton would have entered into the contract anyway but the Privy council decided that the threats did not have to be the only factor contributing to the signing of the contract.

 

 

They considered that the responsibility was on Armstrong and others like him, who may have used threats, to prove that any pressure they had used had not caused the disadvantaged party to sign the contract. If the threats had an effect then, regardless of whether the other party would have signed or not, duress would be proven.

 

It is not enough to show that the threat amounted to an unlawful act – there must be some threat which perverts the consent or free will of the party in question. In R v Att General of England and Wales (2003) which involved materials written and published about activities of the SAS and the infamous Patrol Bravo Two Zero. The MOD subsequently introduced a requirement that confidentiality agreements be entered into to prevent further difficulties of the same sort in the future. R was told that he had to sign the agreement if he wished to remain with the regiment (a form of punishment). This may have caused pressure but the view was taken that R still had a choice and that the MOD's actions were both lawful and justified and did not operate to vitiate R's consent.

 

It is generally recognised that the threat must be made against the person as opposed to objects or goods In the case of Skeate v Beale (1840), the court had decided that since the threat had been directed towards property, this did not constitute duress. The situation has not been helped by the case of Maskell v Horner (1915) which seems to suggest that restitution may be available in the case of threats to goods. In this case the defendant insisted that he was entitled to a toll from the claimant for the use of a market stall. There was no legal basis for such a threat but the defendant threatened to seize the claimant's goods if he did not pay. The claimant paid up under protest and sued for the recovery of the payment claiming duress and the claim was allowed. However the case raises the issue of whether the ruling is inconsistent with the normal understanding that the threats complained of must be directed at the individual.

 

It seems that duress had developed from the notion that the duress or threat amounted to a threat to life or limb. In modern times it is now accepted that the threat must be real and amount to some unlawful act and that 'some illegitimate means of persuasion was used.'

 

In Williams v Bayley (1866) a son had forged his father's signature on some promissory notes and then gave them to a bank and the bank lost money because of the forgery. The bank later held a meeting with the father and the son when it was intimated that the authorities may have to be advised as a criminal offence had been committed. The bank said they would not prosecute the son if a satisfactory arrangement could be reached. With the threat of possible transportation for life having been mentioned the father proceeded to give security for the debt of his son and entered into an agreement to mortgage his property to pay for the promissory notes. In a subsequent action by the father the agreement was avoided. The House of Lords set aside the agreement on the grounds of undue influence. The threat to report the forgery was not unlawful but the bank's actions in effect amounted to a form of undue influence negating the consent.

 

In this case ‘pressure’ had been placed on a party in a similar way as occurs with duress. As the type of threats now considered as possibly giving rise to duress has grown it is likely that this would now be classed as duress.



In reality the plea of duress is rarely made. This is not to say that a claimant is deprived of any basis for an action as an alternative claim may be made on the basis of undue influence where unfair pressure may be present but not covered by the concept of duress.

 

If a claimant succeeds in their claim for duress the contract is voidable rather than void and can be set aside by one party.

 

 

 

(Word count 1164)

 

Barton v Armstrong & Ors [1973] UKPC 2 (05 December 1973)

[2003] UKPC 22 - British and Irish Legal Information Institute

Can I cancel a contract? | Money | theguardian.com

Prenuptial deals could be made legally binding | Law | The Guardian

This essay looks at duress as applied to contract law. It looks at how the presence of duress is able to destroy the legal effect of a contract. Cases examined include:

Cumming v Ince (1847)

 

Barton v Armstrong (1973)

 

Williams v Bayley (1866)

 

R v Att General of England and Wales (2003)

 

Skeate v Beale (1840)

 

Maskell v Horner (1915)



Related Items

The items below list this Essay as being related in some way.

Tags

There are no related tags.

Amazon's recommended Books

RSS Feeds