North Sea Shipping Co v Hyundai Construction, The Atlantic Baron [1979] QB 705

• Defendant was contracted to build a tanker for Plaintiff for a price in dollars that was not to change.

• When the dollar devalued, Defendant demanded that a higher price be paid to compensate and threatened to terminate unless Plaintiff agreed. Plaintiff paid and then tried to reclaim the money due to economic duress.

• Mocatta J held that there was duress, BUT that Plaintiff couldn’t reclaim the money because, in paying the final instalments later on without protest and in making a big delay in their claim for payments, they had actually affirmed the contract. 

Mocatta J

• The approach to economic duress is to see if the principles fit, NOT to reason by analogy or see if the case falls within previously established categories.

• A threat to break a contract MAY = economic duress in the right circumstances.

• Generally money paid under economic duress can be recovered and contracts voided (provided no affirmation).