Lecture Notes on Duress and Undue Influence in Contracts

Key Points

• Duress and Contract Law: Discussion on factors to determine if duress existed in a complaint.
  • Alternative Course: Did the complainant have options other than yielding to duress?
  • Protest: Was there any protest by the party claiming duress?
  • Independent Advice: If the party had independent advice, the claim of duress is weakened.
  • Avoidance Steps: Actions taken to avoid the contract post-pressure removal are considered.

Contract Modification

• Case study: William and Rafael Brades.
• Main contractors may promise incentives to subcontractors to ensure satisfactory work pace.
• Illegitimate Pressure: Must be present for duress to be claimed, e.g., a threat to breach a contract.

Economic Duress

• Atlas Express v. Kafco: Demonstrates economic duress and lack of consideration.
• In Ghana, lack of consideration is mitigated by Acts 25.

Legitimate vs. Illegitimate Threats

• Legitimate Threats: Not entering into a contract or legal threats like suing are legitimate.
• Illegitimate Threats: Force or coercion that affects free will in agreements.

Undue Influence in Contracts

• Definition: Occurs when one party's free will is dominated by another, often due to a fiduciary or dominant-subordinate relationship.
• Examples of Relationships:
  • Parent and child
  • Trustee and beneficiary
  • Solicitor and client
  • Doctor and patient
  • Religious advisor and follower

Presumed Undue Influence

• Presumption: Exists in fiduciary relationships where the influence of a dominant party is presumed.
• Rebuttal: Stronger party must show full disclosure, adequate consideration, and independent advice for the weaker party.

Actual Undue Influence

• Evidence Required: Must be proven with evidence of actual undue influence.
• Burden of Proof: Lies with the claimant of undue influence.

Cases Discussed

• Heman v. Kofi: Demonstrates how undue influence can lead to setting aside transactions.
• Barclays Bank v. O'Brien: Highlights the importance of independent advice for parties in a fiduciary relationship.
• Lancaster Limited v. Black: Presumed undue influence and the way it can be rebutted.

Remedies for Duress and Undue Influence

• Contracts affected by undue influence or duress are voidable.
• Remedy involves applying for rescission to set aside the contract.

Upcoming Topics

• Illegality and Public Policy
• Deciding Contracts
• Planned to be covered before end of the semester.

Administrative Notes

• Upcoming Zoom classes on Friday evening and the weekend.
• A seminar with a set of questions for semester revision.
• Class reps to organize groups for question assignments.