"It is assumed that the parties know their own minds, that they are the best judges of their own needs and circumstances, that they will calculate the risks and future contingencies that are relevant, and that all these enter into the bargain. It follows that unfairness of the bargain – gross inadequacy or excess of price – is irrelevant, and that once made, the contract is binding.” This harsh quotation of Atiyah reveals the severity and the power given to contractual agreements by the English law. The English system through its particular tools of creation of the law created two theories softening the rule set by the contractual agreement. Indeed the consent of a contracting party may have been obtained by some form of pressure, which the law regards as improper. The victim of such pressure may be entitled to relief under the common law of duress, and under the equitable rules of undue influence. Treating this issue is a choice that can appear particularly relevant providing the specificity of the concerned concepts and the necessity to point out the differences of the common law and the equity as regards to the French legal system.
[...] Then, the burden of proof is on the dominant party to show that Undue Influence did not occur. Types of Presumption A presumption is a rule of law by which, on proof of a specified fact(s) is taken to exist. English law distinguishes between irrebuttable presumption and rebuttable ones. A rebuttable presumption is a legal presumption subject to valid rebuttal whereas an irrebuttable presumption amounts to inferences which may not be rebutted because evidence will not be admitted to contradict them. [...]
[...] This reasoning is borne out of the remedy offered to duress: the contract is rendered voidable, not void. It is necessary to focus briefly on the meaning of these words. Voidable: capable of being voided, to be set aside; a voidable contract has legal effect until avoided at the option of one of the parties. As opposed to void, which means without force, of no legal effect. A void contract is a paradox, in truth there is no contract at all (Fawcett v Star Car Sales Ltd)[22]. [...]
[...] Kafco could not risk being in breach of their contract with Woolworths, and so agreed to the increased charges, Kafco resisted on the ground of duress. The Court accepted that there was no real option for them, but to agree. An action for damages against Atlas for breach of the original contract would not have been sufficient to counteract the effects of the destruction of their business relationship with Woolworths. Kafco were not obliged to pay the additional carriage costs. However, it would seem to be incorrect to argue that duress is based upon consent being vitiated so that the agreement is not voluntary. [...]
[...] where a person had been forced to enter into the contract under an imminent threat of having his house burnt down, or a valuable picture slashed. The doctrine recognised this way, the duress to property. His view has become authoritative and has been followed in later cases, so that the question is no longer what was threatened, but whether the effect of the threat was to bring about coercion of the will, which vitiates the consent”.[7] The view that consent is “vitiated” has given raise to a great debate and a lot of criticisms and this is left open in Dimskal Shipping Co SA v International Workers Federation, The Evia Luck {No2} But these criticisms seem to be principally based on a simple misinterpretation: what it appears to mean is, not that the consent is negatived, but that it has been improperly obtained. [...]
[...] Conclusion Does the approach of the Courts to the issues of Duress and Undue Influence simply reflect a general reluctance to enforce transactions which are so unfair as to be regarded as “unconscionable”? Is this the underlying principle in these cases? At the root of both the doctrines of duress and undue influence lie considerations of fairness between the parties and a desire to prevent one party taking unfair advantage of the other. Lord Denning attempted to unite the two under a new doctrine of unconscionability or general fairness in Lloyds Bank Ltd v Bundy[78], where he identified this as “inequality of bargaining power”. [...]
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