economic duresss

• economic duress- when someone enters into a contract as a result of financial threats.
• undue influence- there is a relationship between the parties which has been exploited by one party to gain an unfair advantage.
• Pao On case identified the following factors to help decide whether economic duress was present:

  • did the person claiming to be coerced protest about the pressure
  • did that person have any other available course of action that was reasonable
  • were they advised before taking the action
  • after entering into the contract, did they take steps to make the contract void
• CTN Cash V Gallagher- decided that the duress was not available when the action threatened was lawful.

  Progress Bulk - decided pressure could be illegitimate even if it was lawful.
• with economic duress there is no consideration because the passing of what would otherwise be consideration is not done voluntarily as a part of a freely negotiated contract.
• effect of finding economic duress:

  makes the contract voidable
• remedies of economic duress:

  • restitution
  • recission
• Universe Sentinel - demonstrated the requirements to show that there must be pressure.