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Contract: Misrepresentation and Economic Duress

Economic duress

  • 3 things to know
  • Components 2 and 3

Overview

Duress in contract law, duress to the person and economic duress.

What you need to know

Answer each one before you reveal it.

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Key term

What is duress in contract law?

Numbers

What is duress to the person?

Key term

Define economic duress.

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    What is duress in contract law?

    Model answer

    Duress is illegitimate pressure that leaves the other party with no realistic alternative but to agree. A contract made under duress is voidable at the victim's choice.

  2. 2

    What is duress to the person?

    Model answer

    Duress to the person is a threat of violence to the contracting party or their family. Barton v Armstrong [1976] held that the threat need only be one reason for agreeing.

  3. 3

    Define economic duress.

    Model answer

    Economic duress is illegitimate commercial pressure that coerces a party into an agreement. The pressure must go beyond ordinary hard bargaining.

  4. 4

    In which case was economic duress first recognised?

    Model answer

    The Siboen and The Sibotre [1976] first recognised that economic pressure could amount to duress. Kerr J accepted that duress was not confined to threats to the person.

  5. 5

    What happened in The Atlantic Baron [1979]?

    Model answer

    The Atlantic Baron [1979] concerned shipbuilders who demanded an extra ten per cent after a currency devaluation. The court found duress but held that the owners had affirmed by delaying their complaint.

  6. 6

    What factors did Pao On v Lau Yiu Long [1980] identify?

    Model answer

    Pao On v Lau Yiu Long [1980] asked whether the victim protested, had an alternative course, and took independent advice. Prompt steps to set the agreement aside also point towards duress.

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