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duress - contract law - Coggle Diagram
duress - contract law
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duress to teh person
historically the first form of duress reocgnized by contract law. If a person is coeerced to enter intoa contract, that contract would be treated as vooodable at the option of te aprty cooerced, who can et it side with any money paid being recovered
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to avouid the contract for duress, the claiamnt misy sjpw
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duress to property
occurs when there is a threat to seize owners property or damage it. At common law, the courts historically recognized that the onlu form of duress is that which is directed at the person
skeate v beale 1840
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A landlord was owed money by a tenant. He seized goods owned by the tenant and threatened to sell them immediately unless the tenant entered an agreement for repayment of the sums owned. The tenant agreed to the repayment terms but then sought to have the agreement set aside for duress.
Held: Duress to goods will not suffice to render a contract voidable.
Astley v Reynolds 1731
P pawned a plate to D for £20
three years later D refused to allow P to redeem the plate unless £10 was paid of interest. The interest was paiud, P sought relief in courts
The case of Astley v Reynolds (1731) (Court of the King’s Bench) found that money paid to release goods which had been unlawfully detained could be recovered. Here a pawnbroker refused to release the pawned goods until Astley paid back far more than the legal rate of interest. The contract was held to be voidable
overruled at the time by skeate v beale
However, in The Siboen and The Sibotre (1976) (HC) Kerr J refused to follow Skeate v Beale (1840). In The Evia Luck (1992) (HoL) Lord Goff also stated that the finding in Skeate v Beale, that only duress to the person would render a contract voidable, was wrong. Duress to goods can form the basis of a claim and can render the contract voidable.
Maskell v Horner 1915
The defendant demanded money from the claimant by way of a 'toll fee' for his market stall. The defendant had no legal basis for demanding this money. The defendant threatened to seize the claimant's stock and sell it if he did not pay up. The claimant paid the toll fee for a considerable period of time and then brought an action for money had and received to recover the money paid under duress.
Held: The claimant was entitled to recover the sums paid in the law of restitution. This decision is out of line with the law on duress of goods in contract law and is considered by some as demonstrating that the position taken in contract law should be revised.
The Evia Luck 1992
lord goff rejected skeate v beale- detention of antoher eprsons goods could be duress, threat must be a
Threat to property must be a 'significant' cause rather than 'a significant' factor as in duress to the person.
Economic Duress
Until the 1970s, only duress to person/property was accepted.
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The atlantic baron
The defendants agreed to build a ship for the claimants for a certain price specified in US dollars. After entering the contract the US dollar was devalued by 10%. The defendants threatened not to complete unless the claimants paid an additional 10% on the contractually agreed price. The claimants had a valuable charter lined up so agreed to pay the additional sums and did pay them without protest. 8 months after delivery of the ship the claimants brought an action to recover the additional sums paid.
Held: The contract was voidable for duress, however, since the claimants had left it so long in bringing their claim they had affirmed the contract and lost their right to rescind.
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pakistan international airline corp v times travel
tehre are 3 elements which need to be established for econ duresx
1) As the act is lawful, the illegitimacy of the threat is determined by focussing on the justification of the demand
A demand motivated by commercial self-interest is generally justified
Economic duress is essentially concerned with identifying rare exceptional cases where a demand, motivated by commercial self-interest, is nevertheless unjustified
Any claim by C against D must have D deliberately creating or increasing C's vulnerability to their demand, and be acting in bad faith, where they know they're acting illegitimately
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illehotomaye pressire
threat of unlawful act
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Therefore it is important to distingusih between ilegitiamte pressure from legitimate pressure that occurs in everyday commercial dealings
one type of illegitinate pressure or threta is the threat of an unlawufl act such as breach of contract
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The Cenk Kaptanoglu
oHeld- from the authorities, 'illegitimate pressure' could be constituted by conduct which was not in itself unlawful, although it would be an unusual case where that was so, particularly in the commercial context.