B bought A’s shares because of A’s threats to kill him and his family if he did not. The Privy Council held by majority that this allowed the contract to be set aside.
Lord Cross: For duress to negate a contract, the duress has to be a reason why the threatened party entered the contract, even if there were “other more weighty causes”. However, if the threat did not affect the threatened party’s decision at all, it cannot cause the contract to be set aside. The burden lies on the threatening party to show that the threat had no bearing on the threatened party’s decision. This is because if one man threatens another, he should bear the risk of the consequences.
McKendrick: NB the majority view that duress renders a contract void contradicts the Pao On view that it merely renders the contract voidable. Also NB the low threshold for the threatened party to overcome.