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Duress and Undue Influence Tutorial Notes

Duress and Undue Influence Tutorial Notes

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Published by Adam 'Fez' Ferris
Duress and Undue influence tutorial notes
Duress and Undue influence tutorial notes

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Published by: Adam 'Fez' Ferris on Mar 30, 2010
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Tutorial Notes  Bring statute book to next tutorial! Read the OFT v. Abbey National Bank plc. caseDuress  common law, narrower scope, undue influence  equity, wider scope.Cases:
[1976] AC 104Duress to the person case. Armstrong and Barton are shareholders in a company. Involved in apower struggle. Barton agrees to pay off loan of $400k and pay other large sums for shares. He thenalleges that Armstrong pressured him into doing so with threats to murder him. Court decides thatas duress to the person is A REASON even if it is not the MAIN REASON then this is enough and itconstitutes duress to the person. Contract therefore void. Burden of proof is with the defendant.Royal bank of Scotland v. Etridge.Wife signs over the interest of a house as a security interest for her husbands debts. The bank tryand enforce the charge, the wife claims undue influence from her husband. Judges decide that scopeis wide and that this constitutes undue influence. Once a bank is on enquiry it is necessary for themto do something about the situation or the contract may be deemed voidable. Get the wife to meetthe bank  go through transactions. Or can be advised by lawyer. The court says that a solicitorneeds to: Explain the nature of documents, what will happen if they are signed, discuss theimplications in laymens terms, state that the wife has a choice, then transfer the letter to the bank.The bank cannot proceed until they have reached the letter. If the bank has suspicion of undueinfluence, they must act on this. If one step of this process is missed, then the contract is voidablebecause the bank has not discharged its notice.There was a following case that adhered to these guidelines. This is now good law. Whenever thereis an odd turn of events the bank must follow these guidelines.Economic duress is usually applied by the party with superior economic power. Lord Hoffman: lookat the demand and the nature of the demand. The courts are not keen to implement economicduress, because economic pressure is part of the bargaining process and this could just be used asan excuse for any party to get out of bargains that they do not like.
R v Attorney General for England and Wales  
Look at the nature of the pressure and [anotherfactor, did not hear].It is legal to threaten breach of contract. You may leave a contract so long as expectation loss issatisfied. Courts find it difficult to classify whether or not threatened breach of contract counts asduress. In an obiter statement a judge stated that threatened breach of contract must be coupledwith bad faith for it to count as duress.Stilk v. Myrick  There were other viable options for the captain so it may not be considered asduress. However, if the crew refused to work unless they were paid more money then this could beconsidered as duress as there is no viable alternative if they are on high seas.

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