Economic Duress

Question 1

Economic duress plan

Answer 1

Definition - Threats to coerce/forcing a party into a contract can invalidate a contract

The V must prove:
1) Coercion of the will
- courts will consider 4 factors identified in Pao On v Lau Yiu Long:
1. Did the injured party protest?
2. Was there any other available course of action?
3. Were they independently advised?
4. After entering contract, did they take steps to avoid it?

2) lllegitimate pressure
- depends on circumstances - a threat to a small firm by a larger firm would breach contract - Atlas Express v Kafco
- commercial pressure isn’t always sufficient

Remedies:
- Will make contract voidable and the injured party must seek rescission as soon as possible after

Question 2

Atlas Express v Kafco

Answer 2

Illegitimate pressure

Threat to breach an existing contract between parties can amount to illegitimate pressure

Question 3

Pao On v Lau Yiu Long

Answer 3

4 factors

No economic duress as D did not protest at the time, could’ve enforces the contract through specific performance, and had another avenue of redress available